US, NNPC sign $1m grant for 1,350mw Abuja power plant
The United States Government, through its Trade Development Agency, USTDA, has offered a grant of $1 million to Nigeria for the construction of a 1,350 megawatts gas-fired power plant in Gwagwalada, Abuja.
USTDA and the Nigeria National Petroleum Corporation, NNPC, signed the project’s agreement at the 2020 Nigeria International Petroleum Summit, NIPS, in Abuja, with the theme: “Widening the Integration Circle: Technology, Knowledge, Sustainability, Partnership.”
US Ambassador to Nigeria, Mary Beth Leonard, who witnessed the signing, said the project will be handled by a US company, General Electric, GE, adding that when completed, the power plant would take advantage of the domestic gas resources and help address Nigeria's existing critical energy needs.
Leonard stressed that the United States has deep expertise in the gas sector and offers unequal expertise in conducting analytical studies, adding that there was no better partner to develop the new power plant than general electric.
"Today, the US Trade and Development Agency and NNPC's gas and power investment company are signing a grant that will provide the in-depth technical, economic and financial analysis necessary to develop a major new source of energy, an exciting 1,350 megawatts natural gas power plant here in Abuja," she said.
According to her, the project demonstrates the US Government's commitment to strengthen Nigeria's energy sector and its enduring partnership with the government of Nigeria, and will join other high profile energy sector projects that the US TDA is supporting across the country.
Speaking further on the benefits of the project, she expressed excitement about what its successful completion would mean for the greater prosperity of Nigeria, adding that Nigeria's huge gas reserve has remained largely untapped creating an incredible opportunity for additional production, increased domestic utilization and eventually export to the global market place.
Leonard said USTDA has funded a diverse array of studies that are building Nigeria's energy capacity, which includes the expansion and deployment of the gas gathering processing project in the Niger Delta that focuses on decreasing the negative environmental, social and economic impact of gas flaring and reinjection.
“USTDA has also funded visibility studies for the development of a virtual pipeline gas transportation link that can process gas and transport it by a truck to customers for power and feedstock, thereby diversifying the country's energy industry," she said.
Also speaking, the Acting Director of USTDA, Tom Hardy, who signed the grant on behalf of the US Government, said the $1.16 million project will utilize indigenous gas resources to address the growing demand for power in Abuja.
Tom said since 1992 USTDA has funded more than 65 activities in Nigeria, which have leveraged nearly $13 billion in financing, adding that the project advances the US' Power Africa, Prosper Africa and Doing Business in Africa Initiatives.
He said a USTDA feasibility study will be carried out to provide informed analysis needed to address critical energy generation in Nigeria, adding that it will also build upon USTDA's commitment to working with their Nigerian partners to develop and expand the nation's domestic gas sector.
In his remarks, the Group Managing Director of NNPC, Mallam Mele Kyari, who signed the grant on behalf of Nigeria, said the grant would provide technical, economic and financial analyses necessary for the development of the combined cycle natural gas-fired power plant to be sited in Gwagwalada, Abuja.
Kyari stated that the power plant, when completed, would deliver power to the national grid for onward transmission to Nigerians to facilitate industrial growth and reduce poverty in the country.
“We all know that there must be a framework. We all know that there are so many delayed projects in this Industry that have to do with delivering gas to the domestic market for so many reasons. One of them is inability to secure financing and other fiscal issues that we are all familiar with and they have to be resolved. What we have to do is to create infrastructure that will deliver gas to the domestic market and we are already doing that,” he assured.
The NNPC boss said the corporation had already delivered the Oben-Obrikun and Obiafu, OB3, gas pipelines, expanded the Escravos-Lagos Pipeline System 2, ELPS 2, with her partners and about constructing the Ajaokuta-Kaduna-Kano, AKK, pipeline which would deliver gas from the OB3 line to Kano.
According to him, along that corridor, the plan is for the NNPC to build three independent power plants in Abuja, Kaduna and Kano, stressing that the strategy would enable the debottlenecking of power into the grid to ensure stable power supply.