The Federal Government has approved a landmark gas supply deal for the $3.3 billion Brass Fertilizer and Petrochemical Company’s methanol plant.
Abuja, NIGERIA- This agreement, reached through the Nigerian National Petroleum Company Limited (NNPCL), marks a significant milestone in Nigeria’s efforts to leverage its vast gas resources for industrialization. The deal, signed with industry giants Shell, TotalEnergies, and Agip, took place at the Ministry of Petroleum Resources in Abuja, nine years after the project was first announced.
The Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, lauded the gas sales-and-purchase agreement as a pivotal moment in Nigeria’s drive to monetize its natural gas reserves and foster economic development.
Speaking at the ceremony, Ekpo emphasized, “This is a significant milestone in the development of the US$3.3bn Brass Methanol Project, one more step in the journey to making the project a reality.”
The project is set to become a key player in the global methanol market, while also helping Nigeria transition from a resource-based economy to an industrial powerhouse. Ekpo added that the accord reflects Nigeria’s commitment to utilizing its abundant gas resources for rapid industrialization and growth. He further noted, “This project will bring in much-needed Foreign Direct Investment and create thousands of jobs for our population, while also transforming the host state and community for good.”
The agreement’s signing also signaled the readiness of Brass and its partners to begin the construction phase of the project. With NNPCL and its partners, including Shell, TotalEnergies, and Agip, now on board, the project is expected to receive an estimated daily supply of 270 million standard cubic feet of gas.
This supply will fuel the methanol plant, located on Brass Island in southern Bayelsa State, a region with vast natural resources that has long been targeted for industrial projects.
The Brass Methanol Project has the potential to be a game-changer for Nigeria’s economy. Upon completion, it is expected to generate more than $1.5 billion annually from the export of fertilizers, petrochemicals, and other gas-based products. This will provide a significant boost to Nigeria’s export earnings and help diversify the nation’s economy.
Additionally, the project is set to reduce Nigeria’s reliance on imported fertilizers by 30 percent, saving the country approximately $200 million in foreign exchange each year. Ekpo highlighted the importance of this move for Nigeria’s agricultural sector, stating that it will “strengthen local production capacity, reduce imports, and enhance food security in the country.”
The signing of the gas deal represents more than just economic growth; it is a critical component of President Bola Tinubu’s Decade of Gas initiative. Launched to position gas as the cornerstone of Nigeria’s industrialization and energy security, the initiative aims to utilize Nigeria’s vast gas reserves to create a sustainable future.
Ambassador Nicholas Ella, the Permanent Secretary of the Ministry of Petroleum Resources, underscored the importance of the project within this broader initiative, noting, “The agreement is a key achievement within the Decade of Gas, which aims to position gas as the cornerstone of Nigeria’s industrialization and energy security.”
Ella further projected that the Brass Methanol Project will contribute around $600 million annually to Nigeria’s GDP, with the potential to spur broader economic growth of up to $2 billion per year. “The project will create over 5,000 direct jobs and 35,000 indirect jobs, significantly improving the livelihoods of many Nigerians, particularly in the Niger Delta region,” he added.
The project’s location in the Niger Delta, a region historically plagued by environmental degradation and economic underdevelopment, is seen as a strategic move to promote local development. By creating job opportunities and stimulating economic growth, the methanol plant is expected to change the face of the host community and contribute to peace and stability in the region.
In addition to boosting exports and creating jobs, the project aligns with Nigeria’s environmental commitments, particularly the country’s pledge to achieve zero routine gas flaring by 2030. By utilizing natural gas for industrial purposes, the Brass Methanol Project is expected to significantly reduce gas flaring, contributing to Nigeria’s environmental goals while driving economic growth.
NNPCL’s Executive Vice President of Upstream, Oritsemeyiwa Eyesan, expressed optimism about the potential of the project to transform Nigeria’s energy landscape. He emphasized that the agreement brings the country closer to achieving a fully operational 10,000-methanol plant, which would further position Nigeria as a global leader in methanol production.
The financial implications of the project are substantial, with expectations that it will attract foreign investors and generate billions of dollars in revenue. As part of the agreement, the federal government is encouraging all parties involved to ensure the project reaches financial close and begins construction in the shortest possible time.
Ekpo reiterated the importance of maintaining the momentum, stating, “I urge all parties to sustain the steadfastness with which they overcame the hurdles of making the signing a reality by achieving a financial close and commencing the actual construction of the project.”
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