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BUSINESS

Shell Signs Agreement to Build Gas Pipelines in Òyó

May 3, 2024 • 3 min read

3rd May 2024

Shell Nigeria Gas and the Oyo State Government have signed an agreement to develop a gas supply and distribution infrastructure that will deliver gas to industrial and commercial users in the state.

A statement released on Friday by Shell Nigeria’s Media Relations Manager, Abimbola Essien-Nelson, disclosed that SNG would build and operate the gas distribution network which would serve customers across Oyo State for 20 years.

According to the statement, the project would start with the construction of gas distribution infrastructure along a 15km pipeline route, adding that it would grow to deliver up to 60 million standard cubic feet of gas per day across the state.

Our correspondent learnt that the first gas was expected in the fourth quarter of 2025.

Speaking at the signing ceremony, the Òyó State Governor, Seyi Makinde, described the project as a catalyst for development in the state.

Makinde said, “This project fits into our plan to drive innovation and industrialisation in Oyo State and we’re ready to partner with more companies and other organisations to enhance the delivery of relevant projects”.

Speaking, the Managing Director of SNG, Ralph Gbobo, noted that the agreement was “a significant milestone for SNG and Oyo State to boost economic activities in Nigeria by supplying industries and manufacturers with natural gas, a more reliable, cost-efficient and environmentally friendly source of energy”.

He explained, “The gas distribution project will be a game-changer in the industrialisation drive of the Oyo State Government and help boost internally generated revenue and result in more job opportunities.

“For SNG, the project is a milestone in our effort to continue growing the energy supply to businesses in Nigeria in line with Nigeria’s ambition to drive progress on the back of natural gas availability across Nigeria under the Decade of Gas initiative”.

The Managing Director of The Shell Petroleum Development Company of Nigeria Limited and Chairman, Shell Companies in Nigeria, Osagie Okunbor, remarked that the event pointed to the value of partnership as “Shell continues to power progress” in Nigeria through more and cleaner energy solutions for commercial and industrial customers.

“Building on our presence in the country since the 1960s and the wide marketing and trading reach of Shell Energy, we are excited about developing gas distribution solutions and delivering competitive and reliable energy for power generation and industrial use across Nigeria.”

SNG was incorporated in 1998 as a fully Shell-owned company. Over the years, the company has become a supplier of gas and now serves over 150 clients in Abia, Bayelsa, Ogun and Rivers states.

The PUNCH reports that the Federal Government said it would stop granting licences to gas companies with no capacity to build pipelines for gas distribution.

This, the government said became necessary to discourage the transportation of compressed natural gas through the roads.

The Minister of State for Petroleum (Gas), Ekperikpe Ekpo, made this disclosure when he was in Abeokuta, the Ogun State capital on Wednesday.

While saying the country must transit from fossil fuel to CNG, Ekpo revealed that he had directed the Chief Executive of the Nigerian Midstream and Downstream Regulatory Authority, Farouk Ahmed, not to issue licences to anyone who could not pipe CNG to the end users.