African nations agree on $10 billion
Three African nations Nigeria, Niger and Algeria signed an agreement
to jointly construct the Trans-Saharan Gas Pipeline (TSGP) from
Nigeria to Algeria for the transportation of African gas to thegas-hungry
European nations at a cost of $10 billion.
The agreement for the ambitious project was signed by the Nigerian
minister of petroleum resources Rilwan Lukman, Algeria's minister of
energy and mines Chakib Khelil and the energy minister Mohammed
Abdullahi of Niger in the Nigerian capital Abuja on Friday.
The project involves building of a 4128km gas pipeline (48-56 inch),
with a transportation capacity of 30 billion cubic meters of natural
gas across the Sahara desert. The cost of the pipeline is estimated
to be $10 billion and the gas storage stations would require
additional $3 billion.
It is envisaged that the project will go on stream by 2015, although
the starting date has not been announced yet.
Nigerian minister said as the agreement is in place, the countries
are now on the lookout for partners for the project adding that the
next step will be to establish the appropriate commercial, fiscal,
legal and technical options before taking the final investment
decision.
A number of oil and gas majors have shown interest in the project
including Russian gas behemoth Gazprom, France's Total, Italy's Eni
SpA, Royal Dutch Shell as well as Gas Authority of India Ltd.
(GAIL).
The pipeline will be built and operated jointly by the Nigerian
National Petroleum Corporation (NNPC) and Algeria's national oil and
gas company Sonatrach along with participation from the Republic of
Niger. Initially, NNPC and Sonatrach would hold 90 per cent stake
and Niger the remaining 10 per cent.
The plan for the pipeline conceptualised in the 70s took a step
forward, when in 2002 NNPC and Sonatrach signed a memorandum of
understanding (MOU) for the preparations of the project. A
techno-economic feasibility study of the project was completed in
2006 which confirmed the viability of the huge project.
Source: Trans-Saharan Gas Pipeline news.
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