The Nigeria Liquefied Natural Gas Limited (NLNG) has appointed one of Japan's leading banks and the core unit of Sumitomo Mitsui Financial Group - Sumitomo Mitsui Banking Corporation (SMBC) and one of Nigeria's leading banks - Guaranty Trust Bank Plc, as financial advisers for Train 7 project estimated to cost between $10 billion and $12 billion.

This is contained in the NLNG's Train 7 fact sheet sighted by The Nation. According to the document, the Train 7 project will be financed partly from NLNG balance sheet. It will also be partly financed through third party corporate loans from Export Credit Agencies and a number of key International and local banks. Discussions on these financial deals are ongoing between the NLNG's management and those of these financial institutions, The Nation learnt.

However, the document categorically stated that Sumitomo Mitsui Banking Corporation (SMBC) and Guaranty Trust Bank Plc of Nigeria were appointed as financial advisers on transactions for the project.

The Company also stated that the present cost of the Train 7 project is an estimation, adding that the actual cost will be established after the Engineering, Procurement and Construction (EPC) contracts signings are completed, which are expected to follow the Final Investment Decision (FID) which was taken on December 27, 2019.

'The Engineering, Procurement and Construction (EPC) phase is expected to commence after the FID. Letter of Intent for EPC Contracts was issued to SCD JV Consortium in September 2019. SCD JV Consortium comprises Saipem of Italy, Japan's Chiyoda and Daewoo of South Korea. SCD JV will be constructing one complete train and one common liquefaction unit with a total capacity of approximately 8 MTPA, as well as associated utilities and infrastructure,' the company said in the fact sheet.

Barring unforeseen circumstances, Train 7 is expected to be completed within five years from start of construction. On completion, it will increase the company's production capacity at its plant on Bonny Island, Finima, Rivers State from 22 million metric tonnes to 30 million metric tonnes per annum.

As part of the projects considered for the mitigation of the impact of workers influx into Bonny Island, NLNG plans to construct a new 'Workers Village' on about 31 hectares of land and is considering an upgraded 'Joint Venture Village' to accommodate construction workers.

Train 7 is expected to create over 12,000 jobs at construction and on completion will generate more revenue to the government in dividends, taxes and feed gas purchases and will further reduce the level of gas flaring in Nigeria. Also it will boost foreign direct investment for Nigeria's upstream and other associated projects coming on stream as well as stimulate local economy.

'Significantly, over 70 per cent of NLNG's profit goes to Nigeria, via the Nigerian National Petroleum Corporation (NNPC) through dividends, and Federal Inland Revenue Service (FIRS), through Company Income Tax. Other applicable taxes include VAT and Education Tax. NNPC also gets 55-60 per cent of the feed gas revenues through its participating interest in the upstream Joint Ventures.

'In addition, personal income tax of over N7 billion yearly accrues to the Rivers State Government through the Company's PAYE scheme. Among other things, NLNG also pays about N140 million and N2.5 million annually in tenement rates to Bonny and Port-Harcourt Area Local Governments respectively.

'NLNG remains one of Nigeria's best investments to-date with about $36 billion paid as dividends to shareholders over the years,' the document said.

Nigeria LNG is owned by four shareholders - the Federal Government represented by NNPC (49 per cent); Shell (25.6 per cent); Total Gaz Electricite Holdings France (15 per cent) and Eni International N.A. N.V. S.àr.l (10.4 per cent).

© Pakistan Press International, source Asianet-Pakistan