China National Petroleum Corporation (CNPC) has promised that it would secure funding to finance and execute the Ajaokuta-Kaduna-Kano (AKK) pipeline project.
The Assistant President and Board member of the CNPC, Mr Wang Shihong, who disclosed this during a high-level meeting between the NNPC and CNPC management on the sidelines of the Forum on China-Africa Cooperation (FOCAC) Summit in Beijing, China, described the project as the beginning of several collaborations between both corporations.
The AKK gas pipeline would enable connectivity between the East, West and North parts of the country, which is currently non-existent.
This is even as the planned investment is expected to have a positive spin-off on power generation and industrial growth in the country.
Financing for the 40-inch x 614km AKK gas pipeline is expected to cost about $2.8 billion with 85 per cent of the funding expected to be provided by the Industrial and Commercial Bank of China (ICBC), Bank of China, Infrastructure Bank of China with Sinosure, China’s Export Credit Agency (ECA) providing insurance cover, while the remaining 15 per cent will be provided by the contractors which include Oilserve/Oando consortium, as well as Brentex/China Petroleum Pipeline (CPP) Bureau consortium.
Shihong assured: “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.”
Responding, NNPC Group Managing Director, Dr Maikanti Baru, pointed out that the project was dear to Nigeria, adding that while at the FOCAC Summit, President Buhari reiterated the potential of the project to strengthen Nigeria-China relations.
He explained further that the Corporation was looking forward to a successful close-out of the project’s financing towards official groundbreaking ceremony in October, this year.
He said: “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.”
In his remarks at the meeting, Executive Vice Chairman of Brentex, one of the contractors handling Lot 3 of the project, Sani Abubakar, noted that tremendous progress had been made towards securing financing since the Engineering, Procurement & Construction (EPC) Contract was signed.
He particularly commended the GMD 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.
Similarly, the Chairman of Oilserve, one of the contractors handling Lot 1 of the project, Dr Emeka Okwuosa, hinted that his company had already gone into some agreements with Brentex/CPP consortium on financing, which in the end, will bring the project under a single financing arrangement.