Chinese Oil Company assures of funding Nigeria’s AKK project
China National Petroleum Corporation, CNPC, has assured Nigeria of its unflinching commitment towards securing funding for the Ajaokuta-Kaduna-Kano, AKK, gas pipeline project.
The state-run oil company gave the assurance during a high level meeting between the Nigerian National Petroleum Corporation, NNPC, and CNPC Management on the sidelines of the Forum on China-Africa Cooperation, FOCAC, in Beijing, China.
Group General Manager Group Public Affairs Division of NNPC, Mr. Ndu Ughamadu, said in a statement that the AKK gas pipeline would enable connectivity between the East, West and North that is currently non-existent.
“It would also enable gas supply and utilization to key commercial centres in the Northern corridor of Nigeria with the attendant positive spin-off on power generation and industrial growth.
“Financing for the 40-inch x 614km AKK gas pipeline is expected to cost about $2.8bn, for the project described as the single biggest gas pipeline in the history of oil and gas operations in Nigeria.
“While 85% of the money is expected to be funded by the financiers which include Industrial and Commercial Bank of China (ICBC), Bank of China, and Infrastructure Bank of China with Sinosure, China’s Export Credit Agency (ECA) providing insurance cover, the remaining 15% will be provided by the contractors which include Oilserve/Oando consortium, as well as Brentex/China Petroleum Pipeline (CPP) Bureau consortium,” he noted.
Speaking on behalf of over six CNPC subsidiaries at the meeting, the Assistant President and Board Member of the CNPC, Mr. Wang Shihong, said his company placed a very high premium on the AKK Project, describing it as the beginning of several collaborations between both corporations.
“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,” Shihong stated.
Shihong, who said that the CNPC cherished its relationship with the NNPC, also pledged to fully support his company’s subsidiary, CPP Bureau, partner in the AKK Project, to ensure success of the initiative.
Responding, the Group Managing Director of NNPC, Dr. Maikanti Baru, stated that the AKK Project was dear to Nigeria, adding that while at the FOCAC Summit, President Buhari reiterated the potentials of the project to strengthen Nigeria-China relations.
Baru added that the NNPC was looking forward to a successful close-out of the project’s financing towards official groundbreaking ceremony in October, this year.
“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,” he said.
Also speaking, Executive Vice Chairman of Brentex, one of the contractors handling Lot 3 of the project, Mr. Sani Abubakar, said since signing the Engineering, Procurement and Construction, EPC, Contract, tremendous progress had been made towards securing financing for the project.
Abubakar commended Baru for driving the project, adding that following his leadership, some of the elements that were not part of the process were brought in, including providing financing for early works.