China’s CNPC Guarantees Funding for $2.8bn AKK Pipeline Project in Nigeria

China National Petroleum (CNPC) has agreed to help secure funds for the Nigerian National Petroleum Corporation’s (NNPC) $2.8bn Ajaokuta-Kaduna-Kano (AKK) pipeline project.

The AKK gas pipeline, which will enable connectivity between the East, West and North, would enable gas supply and utilization to key commercial centers in the Northern corridor of Nigeria.

The project, which forms phase one of the Trans-Nigeria Gas Pipeline (TNGP) project, is claimed to be the single biggest gas pipeline of oil and gas operations in Nigeria.

CNPC assistant president and board member Wang Shihong said: “We are in full support of Nigeria’s quest to deliver the AKK project. We are working relentlessly towards securing funding for the project based on regulations and policies of Chinese financial institutions.”

About 85% of the capital cost for the project will be funded by the financiers including Industrial and Commercial Bank of China (ICBC), Bank of China, and Infrastructure Bank of China while Sinosure, China’s Export Credit Agency (ECA) will provide insurance cover.

The remaining 15% for project cost is planned to be funded by the contractors which include Oilserve/Oando consortium, as well as Brentex/China Petroleum Pipeline (CPP) Bureau consortium.

Shihong said that CNPC will fully support its subsidiary, CPP Bureau, which is partner in the AKK Project, to ensure success of the initiative.

NNPC plans to commence construction of the project in October this year. It will originate from Ajaokuta and pass through Abuja and Kaduna, before ending at a terminal gas station in Kano.

NNPC group managing director Dr Maikanti Baru said: “We want to maximize the construction work before the end of the year. We are hoping for the quick resolution of the financing agreements so that we will kick-start the project in October, when the dry season begins.”

The pipeline project will have capacity to transport 3,500 million metric standard cubic feet per day (Mmscfd) of dehydrated wet gas from several gas gathering projects located in southern Nigeria.

 

Source: Compelo Energy

 

 

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