- Says project to drive energy transition in Nigeria
- Facility provided byconsortium of 7 banks
- Cost optimisation puts AGPC construction cost at $650m inclusive taxes, down from initial $700m
Seplat Petroleum Development Company Plc, a leading Nigerian independent energy company listed on both The Nigerian and London stock exchanges, on Monday announced that its incorporated joint venture (IJV), the ANOH Gas Processing Company (AGPC), has successfully raised $260million in debt to fund completion of its ANOH Gas Processing Plant (AGPC).
The 300 million standard cubic feet (mmscfd) capacity plant, located on OML 53 in Assa, Ohaji local council of Imo State, is being built by AGPC, which is an IJV owned equally between Seplat and the Nigerian Gas Company (NGC), a subsidiary of the Nigerian National Petroleum Corporation (NNPC).
Seplat and NGC have previously provided a combined $420m in equity funding, with the $260million new facility making the project to now be fully funded.
According to ChiomaNwachuku, general manager, external affairs and communications at Seplat, in a statement to Business A.M., the latest $260million funding was provided by a consortium of seven banks, including Stanbic IBTC Bank (which is the advisor), United Bank for Africa, Zenith Bank, FirstRand Bank Limited (London Branch) / RMB Nigeria Limited, the Mauritius Commercial Bank Limited, Union Bank of Nigeria Plc and FCMB Capital Markets Limited.
Roger Brown, chief executive officer of Seplat, said completing the funding of ANOH is an important milestone for AGPC.
“The ANOH development is one of the government’s seven critical gas development projects; and our involvement provides a clear path towards strengthening Seplat’s position as Nigeria’s leading indigenous diversified energy producer. It will help us drive, alongside our government partners, Nigeria’s transition to cleaner, less-expensive power generation,” Brown said.
He said they, at Seplat, were extremely proud to partner with the Nigerian Gas Company in this strategically important project, which will create jobs and prosperity in the Nigerian economy. Seplat will continue to diversify its business and invest in gas to help Nigeria develop its own natural resources, which in turn will drive more sustainable social and economic growth for a young, rapidly growing population, he said further.
On his part, Okechukwu Mba, managing director of AGPC, said, “successfully closing the $260 million debt facility means that the ANOH project is now fully funded.”
He said, once operational, the AGPC will be a significant supplier of gas to Nigeria’s power sector, supporting local employment and the cleaner generation of power for Nigerian homes and businesses.
“We conservatively estimate that the gas from AGPC will be enough to generate electricity for more than 5 million people,” Mba said at the signing of the $260million funding facility.
The facility also allows for an additional $60million at the time of completion to fund an equity rebalancing payment at that time, if considered appropriate.
Funding commitments of more than $450million were received by the company, which is a significant oversubscription and a strong sign of confidence in the project.
Following a cost optimisationprogramme, the AGPC construction cost is now expected to be no more than $650million, inclusive of financing costs and taxes, significantly lower than the original projected cost of $700million.
ANOH is one of Nigeria’s most strategic gas projects. It will help the country to accelerate its transition away from small-scale diesel generators to cleaner, less-expensive fuels such as natural gas for power generation.
Seplat is a leading provider of natural gas to Nigeria’s power sector, supplying around 30 per cent of gas used for electricity generation.