Golar LNG and NNPC Sign Agreement for FLNG Facility in Niger Delta

The African Energy Chamber (AEC) commended the milestone, stating that projects like the FLNG facility are crucial for scaling up gas commercialization in Nigeria and fostering industrialization across Africa.

Marine LNG infrastructure developer Golar LNG has signed a Project Development Agreement (PDA) with the Nigerian National Petroleum Corporation (NNPC) to deploy a Floating Liquefied Natural Gas (FLNG) facility offshore Niger Delta. The facility, with a capacity of 400-500 million standard cubic feet per day (MMscf/d), will produce LNG, LPG, and condensate. The companies aim to reach a final investment decision (FID) by the end of 2024, with first gas production expected by 2027.

The African Energy Chamber (AEC) commended the milestone, stating that projects like the FLNG facility are crucial for scaling up gas commercialization in Nigeria and fostering industrialization across Africa.

The FLNG project will monetize proven gas reserves in Nigeria's shallow waters and aligns with Nigerian President Bola Ahmed Tinubu’s mandate to leverage gas for sustained economic growth. The project is part of a broader agenda to commercialize the country’s offshore natural gas resources.

In May 2024, Nigeria inaugurated three new gas projects: the expanded AHL Gas Processing Plant, the ANOH Gas Processing Plant, and the 23.3-km ANOH to Obiafu-Obrikom-Oben Custody Transfer Metering Station Gas Pipeline. These projects will collectively supply 500 MMscf/d to the domestic market. Additionally, the Nigeria-Morocco Gas Pipeline development is progressing, with feasibility studies for the first section nearing completion.

In 2023, NNPC signed a Heads of Terms agreement with UTM Offshore for Nigeria’s first indigenous FLNG project, now advancing to the Engineering, Procurement, Construction, Installation, and Commissioning phase. Shell plans to invest up to $1 billion over the next decade to develop Nigeria's natural gas resources, reflecting global interest in the country's gas market potential.

Nigeria’s gas projects are supported by policies incentivizing foreign investment and project development, including the “Decade of Gas” initiative and the Petroleum Industry Act (2021). These policies position gas as a key driver of economic growth and investment.

“With over 200 trillion cubic feet of proven gas reserves, Nigeria is poised to become a global hub for sustainable energy,” said NJ Ayuk, Executive Chairman of the AEC. “The FLNG project by NNPC and Golar LNG is a crucial step towards enhancing gas commercialization, unlocking economic opportunities, job creation, and infrastructure development.”

The agreement precedes the Africa Energy Week (AEW) conference, scheduled for November 4-8 in Cape Town, where the FLNG facility will be showcased. The event will highlight investment opportunities in Nigeria’s energy sector, emphasizing the significant potential of the country’s gas market.