Oyo State Government and Shell Nigeria Gas (SNG) have inked a deal aimed at bolstering gas supply and distribution infrastructure, catering to industrial and commercial sectors within the state.
Governor Seyi Makinde of Oyo State disclosed this development via his social media account on Friday, May 3, 2024, revealing that the agreement was formalized in London, United Kingdom. Under the terms, SNG will undertake the construction of a Pressure Reduction and Metering Station (PRMS) and lay pipelines on a Build-Own-Operate-Transfer (BOOT) basis.
“This marks a pivotal moment as we finalize the investment agreement for the Oyo State Government-Shell Nigeria Gas Infrastructure Development and Distribution project,” Governor Makinde affirmed.
Valued at approximately $100 million, the project is slated to kick off with the establishment of the PRMS and the laying of pipelines by SNG, with ownership set to transition to Oyo State after a 20-year period.
“With this accord, we anticipate the commencement of gas supply to industrial, manufacturing, commercial entities, and our independent power project within Oyo State within 18 months,” Makinde asserted.
Ralph Gbobo, Managing Director of Shell, hailed the agreement as a significant stride for both SNG and Oyo State in bolstering economic activities by providing industries and manufacturers with access to natural gas. Emphasizing the benefits of natural gas as a reliable, cost-efficient, and eco-friendly energy source, Gbobo underlined the transformative impact the gas distribution project would have on Oyo State’s industrialization agenda.
“This initiative represents a watershed moment in our endeavor to expand energy supply to businesses in Nigeria, aligning with the country’s vision to drive progress through the availability of natural gas, as part of the Decade of Gas Initiative,” Gbobo remarked.
The project is slated to commence with the construction of gas distribution infrastructure spanning 15 kilometers of pipeline route, ultimately scaling up to deliver up to 60 million standard cubic feet of gas per day across the state.