Nigerian companies to save over $320m from facilities upgrade

by | November 14, 2017 1:28 am

Indigenous capacity to receive high volume petroleum products for distribution is being enhanced with the launching of the Lagos Midstream jetty which is capable of receiving 45,000DWT vessels.

The downstream of the Nigerian oil and gas industry would through this development be saving an estimated $320 million yearly from associated cost resulting from Ship-to-Ship (STS) transfer, as well as demurrage.

The launching is the second in the series of indigenous companies upgrading their reception facilities in the course of this year alone.

Earlier in the year MRS Oil Nigeria Plc, commissioned a berthing terminal – Dantata Jetty, which has a capacity to berth vessels of 80,000–120,000 metric tonnes capacity at the Tin Can Island Port in Lagos.

MRS facility is said to be saving an estimated $200 million while Lagos Mid stream Jetty would save about $120million.

The country is expected to save about N43 billion annually  from the operations of the Lagos  Midstream Jetty  commissioned last week.

The jetty was constructed at a cost of $150m and was designed to increase the vessel delivery capacity and off-loading efficiency of petroleum products at Apapa Lagos.

It has been identified as an immensely valuable asset in the OVH Energy stable as it will allow 45,000DWT vessels to berth and discharge their products without lightering and demurrage.

The cost saving across the industry will be in excess of $120 million per annum. The jetty is expected to lead to significant reductions in the cost of importing petroleum products into Nigeria.

Maikanti Baru Group Managing Nigerian National Petroleum Corporation (NNPC) has however advised private companies to develop innovative and profitable solutions that would not only aid the development of the Country but also ease the way of doing business.

He said that development of the much-needed critical infrastructure should not be seen as the sole responsibility of government. “The reality is that we all have a role to play in developing and moving the economy forward, an economy that will benefit us all today and generations yet unborn,” Baru stated.

Deji Osikoya, general manager of ASPM Limited, a subsidiary OVH Energy  said, “The Lagos Midstream Jetty is an innovative infrastructure investment designed to radically transform the efficiency of Nigeria’s downstream landscape and boost Nigerian’s petroleum downstream economics.  We expect the Jetty to become an extremely valuable and viable portfolio especially for marketers, reducing delays caused by infrastructural limitations in Lagos, thus improving marketers’ service delivery and profitability and reducing the financial drain on the nation’s resources.”

The Jetty is equipped with a gangway tower to facilitate vessel discharge operations and an on-shore control station at Alapata, Apapa which serves as the central control center for its off-shore and on-shore operational activities fully equipped with an automated process control system.

“The Lagos Midstream Jetty (LMJ) is fully operational, having berthed 10 vessels and discharged products totaling 255,000 metric tonnes of cargo demonstrating its potential as a functionally efficient and safe facility.

With a monthly volume capacity of 240,000metric tonnes, or 240,000,000 litres, the Lagos Midstream Jetty is set to substantially boost supply of petroleum product into Nigeria, and contribute an estimated NGN13.1 billion ($36 million) cost reduction in product imports and associated transactions.” Osikoya further added.

Olusola Bello

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