Financial Energy Review
The Federal Government, Tuesday, disclosed $2.5 billion loan from China to complete Ajaokuta-Kaduna- Kano, AKK, gas pipeline project by 2023.
This was made known by the Minister of Finance, Zainab Ahmed, during an inspection of the project by one of the contractors handling section one, Oilserv Nigeria Limited, which is from Ajaokuta to Abuja.
Ahmed who expressed optimism that the project will be delivered by 2023 said the job pace by Oilserv despite the slowdown of economic activities job has continued without obstruction.
According to her the whole essence of the project is to create jobs for Nigerians and open up the economic space for industrialization.
She said: “We are here to see the work that has been done. This a very important national project, and to see this project is being delivered on time and of course despite the slowdown in economic activities this project has not slowed down, even work has not stopped for one day.
“We are glad that gas is being piped to Ajaokuta, Kaduna to Kano. This project in this part of the country will create jobs, even now that work is going on locals are being employed. The contractor is doing a quality and excellent job, and we commend NNPC for implementing this project.
“We have to give a sovereign guarantee to the lender so that the loan is concluded. I am glad to say the loan has been concluded. And very soon the disbursement will start to the contractor. For now it is $2.5 billion.”
Meanwhile, speaking earlier the Chairman, Oilserv, Engr Emeka Okwuosa, assured that section one of the project will be completed as stipulated in the agreement.
Okwuosa also made it known that all staff and material for the project are from Nigeria as his company is an advocate of local content.
“We want to assure you sure very clearly that this project will be delivered in line with the schedule and with top quality.
“Over here we employ locals as we move to the community and empower them as sub-contractors and is a testimony to the development of local content.
“Oilserve is a representative of local content from engineering, procurement and construction. The things we have to buy overseas of course are things we cannot manufacture here. We are abiding by it, the materials and vehicles inclusive. So clearly local content is exemplified.
“For the line pipes base on the fact that the loans are obtained from China the line pipes have to be from China apart from that every other thing comes from Nigeria.”
On the challenge of high exchange rate he said that does not affect the project in any way as the project is in Dollar terms, “The project is an international project in as much we are conducting it in Nigeria so it is denominated in US Dollars, so we don’t have any mismatch with Dollar and Naira.”
On level of completion he said, “The percentage of work that has been done, putting it in perspectives, normally in this project you do engineering design, procurement of materials, and then the construction but because of the fact that procurement will take time to happen. When pipes are ordered they will mill the pipes that have.
“So we started preconstruction work, and it is a process, but if you put it together we are close to 10 per cent of the entire project, but it will speed up as soon as we have our line pipes.”
However, the Oilserv boss disclosed that there has not been a major security threat to the project as it carries the communities along in the job and make it a community-owned project
“We have come a long way and we always have a security procedure, and that procedure is always based on strategy and plan. It is stated clearly the areas we are operating in and the situation.
“We do a scan to know what the issues are and based on that we deploy the right security. We are working in the middle of the bush and we don’t have a problem and we are doing what is necessary.
“The Major aspect of that security is being in tandem with the community and work closely with the community and that is the first line of security”, he said.
