Chevron, NNPC Begin Gas Supply to Dangote Fertiliser

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By Dipo Olowookere

The management of Dangote Fertiliser Limited said it has started receiving gas supply from the Nigerian Gas Company and Chevron Nigeria Limited under the Gas Sale and Purchase agreement to supply 70 million standard cubic feet per day (Scf/d) of natural gas to its plant in Lagos.

The $2 billion Granulated Urea Fertiliser factory has a capacity of 3 million tonnes per annum and has been classified as the biggest project in the entire fertiliser industry history in the world.

Siapem of Italy is the Engineering, Procurement and Supervision (EP) Contractor for the project, while Tata Consulting Engineers, India, is the Project Management Consultants (PMC) for the project.

The project, which will create thousands of direct and indirect jobs in construction and related fields, will provide a major boost to the agricultural sector by significantly reducing the importation of fertiliser in Nigeria and ultimately removing the need for imports when plant is in full production.

“I am happy that by the time our plant is fully commissioned, the country will become self-sufficient in fertiliser production and even have the capacity to export the products to other African countries.

“Right now, farmers are forced to utilise whatever fertiliser that is available as they have no choice, but we need to know that the fertiliser that will work in one state may not be suitable in another state, as they may not have the same soil type and composition.

“The same fertiliser you use for sorghum may not be the fertiliser you will use for sugar cane,” the Group Executive Director, Strategy, Portfolio Development & Capital Projects, Dangote Industries Limited, Mr Devakumar Edwin, said.

He noted that Nigeria will be able to save $500 million from import substitution and provide $400 million from exports of products from the fertiliser plant, adding that, “The supply of fertiliser from the plant will be enough for the Nigerian market and neighbouring countries.”

Business Post gathered that at the moment, the factory is undergoing various stages of pre-commissioning and test-run. Virtually all the section of the plant such as Central Control Room, Ammonia and Urea Bulk Storage, Cooling Tower, Power Generator Plant, Granulation Plant, have all been completed and are going through pre-testing.

Speaking further on the project, Mr Edwin said the fertiliser complex, which is sited on 500 hectares of land, has the capacity to expand as it is only occupying a small fraction of the allotted portion.

“The management of the complex are confident that the fertiliser business will deliver reasonable profit to the company and its shareholders as it is projected that population growth and the need for food production will jack up the consumption of Urea fertiliser beginning from 2020 when production of the production would have commenced in earnest.

“The current consumption of Urea estimated at a dismal 700,000 tonnes per annum by Nigerian farmers is said to be due to very poor usage and is believed to be the cause of poor product yield, which threatens food security in the country.

“By 2020, Nigerian population is projected to increase to about 207 million which would lead to increased food production.

“Estimates points out that around five million tonnes of fertilisers are required per year in Nigeria in the next five to seven years bifurcated into 3.5 million tonnes of Urea and 1.5 million tonnes of NPK while current production levels in Nigeria are at 1.6 million tonnes by 2019.”

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