Funding Won’t Affect Delivery Of $2.6bn AKK Gas Project-FG

The Federal Government has assured that funding will not affect the delivery of the $2.6bn Ajaokuta-Kaduna-Kano gas pipeline project, as it has secured a total sum of $2.21bn China loan to fund the project.

The 614 kilometer pipeline project, which was flagged off in July this year is expected to enhance industrial development and promote local manufacturing through the utilization of the country’s widely available gas resources.

Expected to be completed within 24 months, the AKK pipeline has Brentex/China Petroleum Pipeline Bureau-CPP Consortia and Oilserve/China First Highway Engineering Company-CFHEC Consortia as the Engineering Procurement and Construction contractors for the project.

The Group Managing Director, Nigerian National Petroleum Corporation, Mele Kyari, during the inspection of the project in Ajaokuta, Kogi State, stated that the project is funded by the Bank of China and Sinosure, a Chinese export and credit insurance corporation, while the Federal Government through the NNPC, will provide 15 per cent equity.

He said, “This project has not stopped for one day since it started. We will complete this project on time, on schedule and on cost. We will deliver this project.

“We borrowed money, 85 per cent of the total project scope as loan and then we provided 15 per cent as equity from NNPC’s own resources.

“So the 85 per cent that will come from our Chinese partners will be available for draw down.”

Kyari who was accompanied by Minister of Finance, Budget and National Planning, Zainab Ahmed, and other government officials, said that there had been deployment of optic fibre lines that would run parallel to the pipeline to ensure security.

Speaking further, the GMD explained that the loan is expected to be repaid by revenue generated from its operation when fully installed.

“More importantly we are using the best of technology so that we will bury the pipes deeper than normal and we don’t think that there is any high level of risk associated with this pipeline,” Kyari said.

The Minister of Finance, Budget and National Planning, Zainab Ahmed, expressed optimism that the project would help to revive industries in those parts of the country and create jobs.

She said the project was being delivered on time and on course, adding that despite the slowdown in economic activities, work had not stopped for one day.

“We have to give a sovereign guarantee to the lender so that the loan is concluded.

“I’m glad to say that the loan has been concluded and very soon, the disbursement will start,” she said.