FG Flags-off Nsik Oil and Gas CNG Mother Station in Akwa Ibom
By Ekemini Simon
The Federal Government of Nigeria has flagged off the construction of a 10 million standard cubic feet per day (MMSCF/D) Compressed Natural Gas (CNG) Mother Station at Esit Eket Local Government Area of Akwa Ibom State.
The project which will be operated by Nsik Oil and Gas Limited is a Joint Venture business between Nsik Oil and Gas and the Federal Government.
Background
The federal government through the Federal Ministry of State Petroleum Resources (Gas), on September 30, 2024, had signed a contract with six companies on September 30, 2024 for gas expansion projects.
The contract which witnessed the disbursement of N122 billion to the business organisations in a bid to ramp up the Federal government gas penetration efforts nationwide had beneficial companies to include Nsik Oil and Gas Limited; Asiko Energy Holdings Limited (AEHL); FEMADEC Energy Limited; Ibile Oil and Gas Corporation (IOGC); Rolling Energy Limited and Topline Limited. The Minister for State Petroleum Resources (Gas), Mr. Ekperikpe Ekpo has however said that the amount released so far is N222bn.
The move is in line with the Petroleum Industry Act (PIA) 2021, which provided for the establishment of the Midstream and Downstream Gas Infrastructure Fund (MDGIF).
According to the law, the initiative is expected to help bridge the huge gas infrastructure deficit which has been a major hindrance towards gas distribution and utilisation in the country
The MDGIF is generated from a pool of 0.5 per cent paid by oil marketing companies on every litre of petroleum products imported into the country as well as through fines paid by oil and gas producing firms as penalties for flaring gas.
For the uptake of the CNG, President Bola Tinubu had directed that one million vehicles must have been converted to CNG by 2027.
Flag-off of Nsik’s CNG Mother Station
Representing President Bola Tinubu, the Minister of State for Petroleum Resources (Gas), Mr. Ekperikpe Ekpo who undertook the groundbreaking ceremony of the project on Thursday at Uquo Isi Edoho, Esit Eket said the project is aimed at reducing carbon emissions through utilisation of gas, limit dependence on premium motor spirit and diesel especially in the face of their high cost by making gas more accessible as cost-effective alternative.
While noting that in two months’ time, the federal government will release N400 billion as a continuation of the gas utilisation initiative, Ekpo called on entrepreneurs to take advantage of the gas resources within their domain by gaining expertise in the gas field thus having credible grounds to apply for approval to do business.
“The time has come for Akwa Ibom people to wake up and take ownership in the oil and gas sector. Nsik has foresight and I call on others in the private sector to go to him and learn so that they can take advantage in this sector”.
The Minister applauded Nsik Oil and Gas Limited for a bold and creative initiative in investing in a sector which he said will become one of the most sought after as Nigeria sees gas as a transiting fuel.
He added ” This project is not about the money. A peaceful environment and bold initiative is key. The Federal Government is taking equity in this project and I thank Nsik oil and Gas for siting this project in Esit Eket”.
In his welcome address, the Chairman and Chief Executive Officer of Nsik Oil and Gas Ltd, Mr. Nsikan Johnny thanked the Federal Government for its support and partnership and the government of Akwa Ibom State for creating an enabling environment towards the realization of the project.
Johnny said through the project, the company looks forward to a future where the CNG Mother Station will power industries, drive the transport sector, and power homes, while reducing carbon footprint and promoting sustainable development.
He added “This project is not just about building a facility; it’s about creating opportunities, stimulating economic growth, and enhancing the quality of life for the people of Nigeria and Akwa Ibom State.
“We are committed to ensuring that this project benefits the local community and contributes to the nation’s economic development.”
In her remarks, Chairman Esit Eket local government area, Mrs. Inemesit Ikot called on the company to deploy effective community and public relations strategy in its policy making in order to succeed.
She expressed optimism that the company will expand its business in a way that will create more employment opportunities for the people, especially the youths.
Ikot said Esit Eket has qualified and competent hands in any area of the company’s human resources hence the company should prioritize employing indigenes of the area.
The Chairman assured that in reciprocation of community relations, the government of Esit Eket will sustain peace needed for the business to thrive thus creating a conducive environment for more investment.
Nsuduok Etudo Ikot, the representative of the Paramount Ruler of Esit Eket, said the company has adhered to both legal and community demands such as the conduct of Environmental Impact Assessment which he said they were involved before siting the company.
He said the Traditional Rulers Council is happy over the investment and assured of the community’s cooperation with the project.
In her goodwill message, the non-executive director on the Board of the Nigerian National Petroleum Company Limited (NNPCL), Dr. Eunice Thomas, commended the Chairman/CEO of Nsik Oil and Gas Company Limited for siting the project in Esit Eket local government area.
She recommended the training of the youths to embrace investment opportunities that will stem from the mother station and other gas facilities as Nigeria focuses on gas as a transiting fuel.
Senator Effiong Bob, the Political Leader of Uyo Senatorial District and Emmanuel Enoidem, the Former Legal Adviser of Peoples Democratic Party in their respective remarks commended Nsik Oil and Gas for the investment. They called on other entrepreneurs to embrace the opportunities the value chain offers.
Earlier, the consultant for the project, Mr. Mkposong Asuquo of Inter Africa Global Consultants Ltd noted that the CNG Mother Station is sited in an economic viable location particularly as they are sandwiched between gas producing companies; Frontier Oil (500 metres to the wellhead) and Savannah Energy (2.8 metres to their facility).
He noted that they already have offtakers from the Nigerian Gas Marketing who have indicated interest to harness the economics of the investment.
According to Asuquo, at completion of the project, the mother station will operate with four reciprocating compressors, delivering CNG into specialized tube trailers for transportation to customers.
The facility, he assured, will serve multiple states, including Akwa Ibom, Rivers, Delta, Cross River, and parts of Abia.