Nigeria’s oil regulator has awarded UTM Offshore Limited the first license for a floating liquefied natural gas (FLNG) plant, designed to capture and process flared gas from an oil field operated by ExxonMobil in the Niger Delta.
This project is part of a strategy to optimize the country’s energy resources while meeting the growing needs of the LNG market.
Flared gas recovery: a strategic challenge
The Yoho field, located offshore Akwa Ibom State, is currently one of many sites where gas is flared.
UTM Offshore’s 2.8 million tonnes per annum (MTPA) FLNG plant aims to recover this gas and turn it into an exploitable resource.
By increasing the production capacity initially planned from 1.2 MTPA to 2.8 MTPA, the project responds to the growing demand for LNG and Nigeria’s desire to reduce the economic losses associated with flaring.
Investment and market development
Global demand for LNG continues to grow, prompting companies to adapt their strategies and infrastructures.
Farouk Ahmed, Director of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), confirmed that this capacity increase reflects Nigeria’s vision to position itself as a key supplier in the global LNG market.
Financing and institutional support
The FLNG project is backed by solid financial backing, with the African Export-Import Bank (Afreximbank) providing $2.1 billion for the first phase of construction.
The bank has also pledged a further $3 billion for the second phase.
These investments are aimed at developing the country’s energy infrastructure and diversifying its sources of revenue through LNG exports.
Implications for the domestic market and exports
The UTM Offshore FLNG plant will also strengthen the domestic gas market, producing 500,000 metric tons of liquefied petroleum gas (LPG) per year for the domestic market.
This initiative will provide economic opportunities while consolidating Nigeria’s position in the international LNG market.
