NLNG shops for N150b to acquire new vessels
By Sulaimon Salau
PLANS are in the pipeline by the Nigeria Liquefied Natural Gas Company (NLNG) to raise $1 billion (about N150 billion) from international markets to acquire six LNG carrier ships.
Specifically, it is gathered that the gas company is in the process of appointing financial advisers for the deal, which is expected to buoy its operations and boost supply.
General Manager for External Relations, Siene Allwell-Brown, who unveiled the plans recently, said the management held a board meeting last week to discuss the appointment of advisers for the loan process.
Her words: “We have contacted global banks from which we will choose a financial adviser who will give us the best option through which we will raise at least a $1 billion loan to acquire six LNG carriers for our operations.”
It was not yet decided which bank would lead and manage the deal, nor from which company they would source the ships.
She did not provide a timetable when the company expects to close the transaction but said that the loan aims to expand the operations of its shipping subsidiary, Bonny Gas Transport Limited, which currently has 24 LNG ships.
Meanwhile, an earlier report had it that the company had plans for a syndicated loan market in the first quarter of 2012, with proposals to obtain loans totaling $4 billion.
According to NLNG website, a Reuters report cited international bankers close to the deal as saying that they had received proposals from the NLNG on a $1billion plus syndicated loan that would enable it purchase new LNG tankers.
The proposals are with potential sponsorship arrangement from NNPC, ENI, Shell and Total.
The report also said a deal to get a loan of $1.5 billion to back the development of offshore oil fields by Exxon Mobil and NNPC was expected to close by the end of January, adding that negotiations for an additional $1.5 billion loan for NNPC was also on the way.
With this action, NLNG and NNPC will join a string of borrowers looking to tap into the international syndicated loan market early this year. Active deals across the continent currently amount to $6billion.
NLNG was set up over two decades ago to harness Nigeria's natural gas resources and produce Liquefied Natural Gas and Natural Gas Liquids for export.
The company has long-term supply contracts with buyers in Italy, Spain, Turkey, Portugal and France and also sells on the spot market.
It has a capacity to produce 22 million metric tonnes of liquefied gas a year. It obtains its gas supply from the upstream oil companies and liquefies it for export.
The gas firm intends to consolidate its position as one of the largest producers and exporters of LNG in the world, becoming the third largest supplier. Currently, NLNG delivers some 10 per cent of the world’s demand and contributing about seven per cent of Nigeria’s gross domestic product. Besides, it supplies over 70 per cent of Nigeria’s liquefied petroleum gas needs.
