BUSINESS
Bayelsa Gas Deal With US Firm Could Exceed $3bn Guyana Project – Fulcrum CEO
The Bayelsa State Government may have just sealed a far bigger deal than the $100 million being reported, after a US energy firm hinted that its planned gas project in the state could exceed its $3 billion project in Guyana.
The deal was struck on Wednesday in Sugar Land, Texas, at the close of the two-day inaugural US-Nigeria Governors G2B Forum on Energy, Mining and Infrastructure.
Governor Douye Diri met behind closed doors with Mr. Jesus Bronchalo, Chief Executive Officer of US-based Fulcrum LNG Incorporated, after the governor’s presentation at the roundtable sparked the firm’s interest.
Fulcrum will now begin a comprehensive field study of Bayelsa’s flare sites to determine the appropriate technology and gathering infrastructure.
Bronchalo said a similar project the company is executing in Guyana is valued at about $3 billion, adding that the investment size for Bayelsa would be determined after the feasibility study and is likely to exceed the scale of its South American operations.
“From FID to commissioning will take about 12 months,” Bronchalo said.
“First, we need to understand the problem on the ground – where those facilities are and why gas is being flared. We will come to Bayelsa to understand the magnitude.”
“Some flares may be so remote or uneconomic that gathering may not be viable. The key question is whether the flaring is due to lack of infrastructure to move the gas or lack of re-injection capacity.”
“The way we do it, we invest 100 percent. If government wants equity, then it brings capital for that portion.”
Governor Diri, who has about 15 months left in office, described the deal as a win-win and assured of immediate commencement.
“Our interest is how this project will reduce the effects of environmental pollution on our people and boost our industrialisation drive,” Diri said.
The project will be executed in phases, beginning with gathering and commercialising flared gas to power the state’s Independent Power Plant and emerging industrial clusters.
This will be followed by a comprehensive integrated gas monetisation plan to harness the state’s vast reserves.
During his presentation, Diri noted that Bayelsa holds an estimated 15-20 per cent of Nigeria’s proven gas reserves and supplies about 60 per cent of the gas utilised by NLNG in Bonny, Rivers State.
He also marketed the state’s 203km Atlantic coastline – the longest in Nigeria – and the Agge Deep Seaport, which he described as Nigeria’s deepest natural port that requires no dredging.
The Forum, facilitated by Westpaq International in collaboration with the US Department of Commerce and US Commercial Service, Houston, brought together Bayelsa, Nasarawa, Ogun and Ondo States alongside over 15 American firms including Honeywell, KBR, Worley, Lummus Technology and VGas.
Daniel Alabrah, Chief Press Secretary to Governor of Bayelsa State, in a statement, said the facilitator of the Forum and CEO of Westpaq International, Mr. Samuel Diminas, expressed delight at the outcome, commending Senator Ben Murray-Bruce for his role in ensuring the Forum’s success.
Diminas affirmed that Westpaq would continue to interface with all parties to ensure prompt commencement, adding that the project holds immense economic opportunities for Bayelsa and Nigeria.
On Governor Diri’s delegation were the Honourary Adviser on Oil and Gas, Dr. Daru Owei, Managing Director of Bayelsa State Electricity Company Limited, Engr. Olice Kemenanabo, Director-General, Bayelsa Investment Promotion Agency, Patience Abah, former Secretary to Bayelsa State Government, Mr. Kemela Okara, and the Chief Executive Officer, Century Energy Group, Chief Ken Etete.
