Viathan to boost productivity with new gas plant
Viathan has completed the construction of its Compressed Natural Gas (CNG) plant, operated by GasCo Marine, a member of the Viathan Group, located in Oke-Sokori, Abeokuta, Ogun State.
The plant, which has an installed capacity of 144,000 standard cubic meters (SCM) per day extends virtual pipeline for gas supply to emerging corporate in one of the fast-growing industrial hubs in the South-West region, to enhance productivity and ease the cost of doing business for the small medium scale enterprises (SMEs).
Backed by InfraCredit’s guarantee, Viathan Group successfully accessed the local debt capital markets for the first time in 2017, issuing a debut of 10 year N10 billion corporate infrastructure bond, with part of the proceeds utilised to finance the construction of the CNG plant.
GasCo Marine, to which 21 per cent of Viathan’s bond proceeds were dedicated, has been able to backward integrate.
In a statement made available to The Guardian, the bonds were largely subscribed by Nigerian pension funds (which accounted for 75 per cent of the bonds subscription), thus affirming the appetite and commitment of the fund to providing domestic credit to the private sector to finance long term, impactful infrastructure projects.
The successful financing of this plant from the debt capital markets also affirms InfraCredit and pension funds’ commitment to supporting new infrastructure that will provide access to cleaner and affordable energy supply for commercial, industrial, and households. This is in line with the Nigerian Government’s aspiration of reducing environmental pollution, and conserving foreign exchange utilisation on imported fossil fuels.
The plant is expected to increase the utilisation of natural gas as feedstock to power and manufacturing plants, by providing gas to areas without pipeline infrastructure (virtual pipeline). This will reduce gas flaring and Green House Gas (GHG) emissions, thereby promoting environmental sustainability, as companies and vehicles switch from expensive diesel to cleaner and affordable gas. GasCo aims to target up to one million vehicles/trucks to switch to natural gas from diesel and petrol thus increasing its market share, whilst the mother station will account for 15 per cent of established plant capacity in the Southern region.
With GasCo Marine’s will continue to deepen its delivery of gas to various manufacturing concerns and power plants, offering at least 40 per cent savings over diesel generators. This is in addition to the notable reduction in capital expenditure (CAPEX) and maintenance cost, as gas usage reduces the frequency of turnaround maintenance/service and enhances the life span of the equipment. Interestingly, gas price is relatively stable, compared to the volatile price of diesel, thus enhancing budgeting and planning for companies.
With stable gas supply from GasCo Marine, medium scale enterprises and Independent Power Plants (IPPSs in the South West are assured of enhanced energy supply, which is expected to improve manufacturing capacity utilisation, enhance cost efficiency, and promote the growth of captive embedded power plants.
The project has resulted in the creation of direct and indirect employment through the creation of 137 new jobs during the construction phase of the CNG plant, as well as 20 skilled workers and 80 unskilled workers, including 40 male and 40 female workers were employed.Post construction, 37 permanent jobs were directly created across various management levels within the organisation. This is line with InfraCredit’s mandate to enable efficient capital allocation and productive investment of domestic pension fund assets into supporting new infrastructure development that will create jobs, protect the environment, reduce poverty, and promote local economic growth.
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