Oando seals $727 million procurement contract for Ajaokuta gas

Nigeria’s Oando alongside its subsidiaries Axxela Limited and Oilserv Limited have been awarded the Engineering, Procurement, Construction mandate for the Ajaokuta.

The company said its side of the contract is the Abuja portion (Lot 1) of the Ajaokuta-KadunaKano Pipeline system (the “AKK Pipeline”) by the Nigerian National Petroleum Corporation.

The company said the contract award follows an extensive due diligence process conducted by the NNPC following a submission by Oando and Oilserv in 2013 in response to an Expression of Interest for a contractor-financed EPC development of the AKK Pipeline Project.

Oando’s Group Chief Executive and Axxela Chairman, Jubril Adewale Tinubu, said: “Our longstanding achievements and aspirations in the gas and power sector are testament to our desire to continuously provide innovative and integrated energy solutions across sub-Saharan Africa. The award of the Ajaokuta – Abuja portion of the AKK Pipeline Project also underscores our position as the partner of choice for investors, regulators, and key stakeholders as gas continues to gain prominence as a key driver for the region’s economic empowerment.” The US$727million Ajaokuta-Abuja Pipeline development is a 215km gas infrastructure with associated facilities such as Metering/Terminal Gas Station, Pigging Station, Block Valve Stations etc.

The development of the AKK grid is a manifestation of the Gas Infrastructure Blueprint in the Nigerian Gas Master Plan, which seeks to extend the existing gas transmission network and achieve connectivity between the East (gas reserves) and the North (demand centres); serve new customers in the Northern regions; and bridge the shortfall in the Western region.

Commenting on the contract award, Axxela CEO, Bolaji Osunsanya, said: “As forerunners in the sector, we remain actively committed to the long term realisation of the Nigerian Gas Master Plan. The development of critical gas pipeline infrastructure and a far-reaching national grid remains pivotal to the country’s industrialization and economic empowerment.

He added that “Consequently, the implementation of the AKK Pipeline Project will enable power-starved communities across the northern region have greater access to electricity, while providing stranded commercial and industrial customers with a cleaner and more efficient source of energy.”