MORE than $9.4billion will be spent by the Nigeria Liquefied Natural Gas (NLNG) to finance the construction of Trains 7&8. The trains would be used to export Liquefied Natural Gas (LNG) to interested buyers/nations, its former Managing Director, Mr Godswill Ihetu, hinted.
He said the firm was awaiting Financial Investment Destination (FID), with a view to building the LNG plant, where the gas would be kept for exportation.
In a telephone interview with The Nation at the weekend, he said building the two trains require significant funding and technical expertise. He said as a result, it would be difficult for the company to give unreliable figures on the cost of the projects.
He said the NLNG’s shareholders, mainly the Nigerian National Petroleum Corporation (NNPC), Shell, Total and Eni, are expected to approve the FID in line with laid down principles of the firm, before the building of the trains begins.
Ihetu said: “The cost of each of the trains is huge, as it runs into billion of dollars, which only multinational oil firms and foreign financial institutions that are credit worthy can provide to finance transactions such as the building of LNG export plants.”
He said fund would be spent on the trains in view of the fact that the six trains earlier built by the NLNG cost $9.4billion.
“ Why would Trains 7&8 not cost more money? Mind you, the country has experienced rise in inflationary rates, foreign exchange rates and among other economic indices, which when factored into the cost of providing the plants is a lot of money. When one calculates the cost of inflation and exchange rates over a period of time, especially when the trains are built and compare the rates with those that are available, one needs not be told that more money is required for the project.” he said.
According to him, the Federal Government removed the pioneer status of NLNG years ago, and as a result, the company started paying taxes.
“Ever since the time the government removed the pioneer status granted NLNG and further granted it exemptions in the area of payment of taxes, the firm has paid taxes, which run into billions of naira to the government.
“This is aside billions of naira earmarked and judiciously spent on Corporate Social Responsibility( CSR) every year, as part of efforts to give back to the society, in which it operates, that is the Niger- Delta,” he added.
SOURCE: THE NATION