BRASS LNG: A Quantum Leap towards target

2010-02-25
THISDAY Newspaper


The tour of project by the Senate Committee on Gas to the Brass LNG facilities was long expected. On several occasions, the trip was called off at a rather short notice to enable the lawmakers attend to other equally pressing national assignments. However, it came penultimate week that the committee finally took its turn to see for itself, the progress of work at the project site of the multi-billion dollar liquefied natural gas project being built on Brass Island, Bayelsa State.

Although, there were no garlands put across the necks of the visitors, a common feature that heralds such occasions in this part of the clime, the seriousness and patriotic approach to the issue at hand exhibited by the lawmakers were commendable. Even their hosts, Managing Director of the Brass LNG Ltd, Mr. Vicenzo Di Lorenzo and his management team needed to beat their chests that they were on the same frequency with the lawmakers.

So, without much ado, it was straight to business as two chartered choppers flew the visitors and others from the Port Harcourt International Airport to AGIP helipad on the Island, a journey of about 40 minutes. At the site, security briefings were delivered while boots, helmets and goggles were given out and worn. Leader of the 5-man delegation, and Chairman, Senate Committee on Gas, Senator Osita Izunaso told his hosts that the several postponements of their visit had nothing to do with lack of interest by the committee in the project. He blamed it on their rather tight schedule. “...So, we have to suspend plenary session to be here today. We are really interested in the success of this project. That is why we are here today to see things for ourselves. We are very much satisfied because we have seen the level of enthusiasm the Managing Director and his team are putting in place to ensure that the project is on board”, the senator said.

He said that the Brass LNG project, when completed, would help in stopping gas flaring which the National Assembly had been trying to achieve for a very long time.
It would also be a major revenue earner for the country and would provide employment for the people, Izunaso noted.

“So, I believe that they are on course and we are going to do everything within our power to support the project and ensure that they move on very fast. One major area of interest to us is the sustainable social development for the communities. We believe that they have done something but they still have to do more” he added. On that note, the Brass LNG boss took the floor to take the visitors on a historical excursion of the project from conception to its present stage of construction.

The Project’s Milestones…
Giving a history of the project, the Managing Director of the company said the Brass LNG Limited was a product of the joint venture agreement that was signed after a 2001 conceptual Memorandum of Understanding (MOU) agreed to by the federal government, Nigerian National Petroleum Corporation (NNPC), Nigerian Agip Oil Company (NAOC), and Phillips Oil Company Nigeria Limited (POCNL). He told the lawmakers that the company’s shareholders were the NNPC, ENI International, Phillips (Brass) Limited (an affiliate of ConocoPhillips) and Brass Holdings Company Limited (an affiliate of Total). The Shareholders' Agreement regulates the manner in which Brass LNG Limited will undertake the project for the construction and operation of two liquefied natural gas (LNG) trains at Brass and the delivery of LNG to the Atlantic Basin gas market.

He said this dream was consummated on December 9, 2003 with the incorporation of the Brass LNG Limited. But in July, Total joined the Board as a shareholder, replacing Chevron Nigeria Limited. With the entry of Total, the share holding was categorised thus: NNPC 49%; ConocoPhillips, Agip and Total with 17% apiece.

Having incorporated the company and ratified its shareholding, he added that the owners held the first Brass LNG Board of Directors meeting on February 20, 2004; while its ground breaking ceremony was held in May 2007 by former President Olusegun Obasanjo, who mandated the board chairman, Dr. Jackson Gaius-Obaseki, to ensure that the project was not only delivered to the benefit of the Nigerian government and to the peoples of the country, but ensure that its product becomes the toast of the international buyers.

When Obasanjo was giving his presidential directive to Obaseki, a man the managing director told the lawmakers was the brain behind the project, the former president expected also that the Brass LNG would contribute to the government’s vision of gas flare down, monetise gas resources, diversify the economy and also stimulate the national economy.

Prior to his ascension to the office of Group Managing Director of the NNPC, Gaius-Obaseki was chief executive officer of the Nigerian Gas Company, a forte that gave him an international acceptability and respectability because all agreed that he acquitted himself on the job creditably.

And, determined to deliver on its mandate, the company contracted its front end engineering design (FEED) for the project to Bechtel Corporation; a San-Francisco, USA-based engineering company.

Project’s Uniqueness
The Brass LNG, according to the managing director, is unique in a number of ways. He said because of its location, the company has no need for community resettlement. He also said that because of its nearness to the source of feed, the company does not have to go into large capital investment in laying what he called extensive gas transportation infrastructure and comes with development opportunity for otherwise stranded gas.

Other unique factors of the project include its ability to produce compressed LPG for domestic supply while venturing into new technology applications in the areas of aero-derivative turbines to increase efficiency, cryogenic sub-sea transportation system (pipe-in-pipe) and state-of-the-art LNG ship technology

Sustainable Development Plan
The host communities of the Brass LNG project, according to the company’s chief
executive, have benefited from the company’s policy in land lease payments, which has also imparted in it, sustainable development vision. In this regard, he said schools and hospitals are being rehabilitated in Twon Brass and Okpoama communities in the area.

Micro-credit scheme was also put in place for the benefit of the people of the Island. He said the scheme, which is a revolving loan system, is managed by credible representatives of the people. Other projects built to sustain the existing smooth relationship with the people include citizen information centre (CIC) and community development capacity building, among others.
The Brass LNG has a vision to be a catalyst in diversifying the occupation of the three largest communities of Twon Brass, Okpoama and Eweoma in the area, whose mainstay is fishing. Statistics show that although 39 percent of the indigenes are into direct fishing business, about 23 percent of the people draw their livelihood from farming, trading and artisanship while 17 percent are into formal employment with private sector companies and the civil service.

But can it live its mission in isolation to a robust relationship or partnership with its host communities? The company’s chief executive said: “We have formed strategic partnerships in all areas of our business, from gas supply to community development. A key aspect of our commitment to our Community & Environment plan is our partnership with Brass Island Communities. We have forged alliances with local, state and federal governments to ensure that both Brass LNG and Nigeria benefit from our projects. We will work closely with non-governmental organisations to derive the most positive impact from our Community & Environment initiatives.

“We have been working to build the skills and employability of our local communities with our training partners. A 9-month academic programme for citizens of our host communities was undertaken at the Petroleum Training Institute, Warri, Delta State. It was run in three batches of 75 students, 50 students and 47 students respectively. They have all graduated and starter packs given to each of them to facilitate their self-employment take-off pending when construction starts.”

Di Lorenzo assured the lawmakers that the graduands would form the bulk of the local workforce that would be engaged by the company when it starts employing staff at that category. “We were responsible for the students’ boarding and tuition fees as well as their upkeep allowances. The participating students were selected by the communities. They took basic training in English, information technology, entrepreneurship skills, amongst others,” he added.

Progress...
The chief executive officer told the lawmakers that the company is determined to deliver the project on schedule and as it progresses towards the Final Investment Decision (FID), it has outlined its project execution and contracting into four main categories.

The categories, according to him are: Gas Trains Engineering and Procurement (E&P) to be awarded to Bechtel; Onshore Balance of Plant (BOP) including Construction of Gas Trains; Offshore Scope of Work and Project Management Services (PMC) contract already awarded to Bechtel. The project execution plan, according to him, was approved by the Brass LNG Ltd Board in February, 2009. Di Lorenzo also told the lawmakers that in 2009, the then Vice-President and now Nigeria’s Acting President, Dr. Goodluck Jonathan, paid a visit to the site; while the project’s early site works were completed also last year.

 

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