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No better time than now to make multi-billion dollar gas investment – Omotowa, NLNG MD; as firm scoops 2016 CSR Excellence Award
According to a statement by Kudo Eresia-Eke, the General Manager, External Relations Division, of the NLNG, this is the view of Managing Director of Nigeria LNG Limited (NLNG),Babs Omotowa, as expressed in his keynote address, Tuesday, at the sixth African Petroleum Producers Association Conference and Exhibition (CAPE IV) holding in Abuja.
Drawing a parallel between energy intensity and pattern of global gross domestic product (GDP), Omotowa who referred the audience to the unfortunate statistic that a vast majority of African countries still have more than 50% of their populations left without access to electricity and have correspondingly low per capita GDP of below $3,000 had this to say:
“It is on record for my company NLNG, that final investment decision was taken on an oil price level of $20 and the cost of steel is now at the same level it was 13 years ago when Train 3 FID was taken. The same applies to the cost of iron. Indeed with the cyclic movement of oil prices, there is no better time to invest in oil and gas projects as construction periods takes the best part of 4-5 years and it is the forecast oil price during production phase that goes into the economics, but the lower prices for input materials and lower construction costs now means that now is the better time to attract needed foreign and local investments and build the oil and gas projects that will enable us solve Africa’s energy crisis and bring Africa from darkness to light. ”.
Omotowa acknowledged that Africa has huge human and natural resources which sadly remain unutilised, 50 years after independence. He noted that Africa today is significant as a primary source of the energy which powers other continents from its huge reserve base, despite the reality that there is a gaping energy gap right here on the same continent. With energy demand in Africa poised to rise significantly with population growth over the coming 20 years, he fingers gas as a unique area of opportunity and an avenue to sustainable revenues, economic growth and manageable levels of poverty.
He predicates this forecast on the global energy demand pattern, where gas is seen growing at 2.7% per year, three times faster than oil, and LNG demand which is growing even quicker, at 7.6% – nearly three times faster than gas.
According to Omotowa, the African Development Bank estimates that Africa requires annual investments in energy infrastructure of some $42 billion over the next decade to catch up with the developed world.
Omotowa also reflected on some bright spots in Africa’s development, mostly initiated by governments over the last 40 years or so.
These include action to end armed conflict, improvement of democracies, security, macro-economic reform and a comparatively better business climate which together have seen foreign direct investment on the continent grow from $1.26bn to $54 bn in 2015.
He fronted NLNG, whose plant at Bonny Island Rivers State is the fourth largest such facility in the world, as an inspirational Nigerian business success story. He lined up political risk stability, corporate structure, technical depth, governance and financial capacity among factors critical to the company’s continuing success while referencing plans to build additional trains and add 40% to current production capacity as part of a corporate growth programme.
He said “NLNG is a great example of how to build a successful model to overcome the unique challenges associated with doing business in Africa. We need similar type of intervention for our gas projects and power generation so we can light up the continent, improve our GDP per capita and take Africa’s teeming population out of extreme poverty”.
Meanwhile, the NLNG has bagged the 2016 Corporate Social Responsibility, CSR, Excellence Award by the Abuja Chamber of Commerce and Industry.
The award is in recognition of the impact of the company’s $12 million pan-Nigeria University Support Programme (USP).
The award is given to companies which CSR projects impacts society without direct benefit to the company.
In a ceremony in Abuja, the Abuja Chamber of Commerce and Industry, ACCI, said after research and comprehensive analysis from a highly professional team of business intelligence experts, NLNG was selected for the award for its CSR work especially its pan-Nigeria University Support Programme (USP).
Receiving the award on behalf of the Managing Director and Chief Executive Officer of NLNG, the General Manager for External Relations, Kudo Eresia-Eke, said, “We are very pleased to receive the Excellence Award for CSR from the Abuja Chamber of Commerce. There are different dimensions to this award.
“Firstly, this is a testament to our core values which guide our work. We stand on the values of integrity, teamwork, excellence and caring. It is great to see that these values have worked for us in our behaviour and interaction with our stakeholders, our operations, our CSR projects and in fulfilling our vision of helping to build a better Nigeria.
“On the other hand, our success and award will inspire other companies to emulate us and even do it better than we have done. The award reminds us of the need for companies to think broadly in CSR terms for purposes of moderation and balance in the nation. Balance is what ensures durability”.
In his welcome address, the President of ACCI, Mr. Tony Ejinkeonye, said neither integrity nor excellence was compromised in choosing Nigeria LNG Limited for the award.
NLNG is owned by four shareholders, namely, the Federal Government of Nigeria, represented by the Nigerian National Petroleum Corporation, NNPC (49%), Shell Gas BV, SGBV, (25.6%), Total LNG Nigeria Limited (15%), and Eni International (N.A,) N. V. S. a. r. l (10.4%).
