Inadequate JV funding delays gas-gathering projects – Shell

 

Lack of adequate joint-venture funding has delayed the planned start-up dates for two major gas-gathering projects, Forcados Yokri Integrated Project and Southern Swamp Associated Gas-Gathering Solutions.

The Shell Petroleum Development Company of Nigeria Limited, which stated this in its briefing notes, said it had continued to work with its joint venture partners and the Federal Government to achieve the objective of ending continuous flaring of associated gas.

According to the report, reduction of gas flared from the SPDC JV’s operations continued in 2015 with a 28 per cent decrease compared to 2014 and a flaring intensity reduction of 15 per cent from the previous year.

The oil major said, “Progress was made on several gas gathering projects, which are now at advanced stages of completion. For example, we have installed a gas-gathering plant at the Olama Station that is ready for inauguration. The Adibawa, Escravos and Otumara gas-gathering projects are also at advanced stages of completion.

“Since 2000, all new SPDC JV facilities have been designed to eliminate continuous flaring of associated gas. In parallel, a multi-year programme was implemented to install equipment for capturing associated gas from older facilities.”

It said, as a result, flaring volume from the SPDC JV facilities was reduced by 85 per cent between 2002 and 2015 and flaring intensity (the amount of gas flared per tonne of oil and gas produced) was reduced by around 70 per cent over the same period.

The Managing Director, SPDC and Country Chair, Shell Companies in Nigeria, Osagie Okunbor, while briefing journalists in Lagos on operational highlights for 2015, said the company spent a total of $195.5m on social investments in the country in 2015, making Nigeria the largest concentration of social investment spending in the Shell Group.

He said $145.1m was paid to the Niger Delta Development Commission as required by law, while another $50.4m was directly expended in social investment projects by the SPDC-operated JV and Shell Nigeria Exploration and Production Company.

He said, “These spend levels have not come about by accident. Shell and its partners believe they can make a real difference in the lives of Nigerians, and we have targeted our investments at community and enterprise development, education and health. Of course, we cannot take the place of government but we are keen to play our part in the development of a country we’ve been part of for more than 50 years.”

The oil major said it spent about $900m on local contracting and procurement to develop the country’s human capital and contracting capacity, with ownership of key assets such as rigs, helicopters and marine vessels as a key focus.