The Ajaokuta-Kaduna-Kano (AKK) gas pipeline project which was flag-off by President Muhammadu Buhari on Tuesday has been described as a commercially viable and will be able to payback the $2.8 billion injected into in less than the 15 years required to repay the facility.
The chairman of Oilserv Limited, Engr. Emeka Okwuosa, give this assuring while speaking with journalists on the sideline of the project flag-off in Ajeokuta, Kogi State.
According Engr. Emeka, the project which is being finance by the Chinese through the Bank of China has repayment period of 15 year, but because of it’s viability the facility can be repaid in 10 years.
Speaking on how the project is funded he said, “This project is funded using facilities and loans that is obtained for the project. The facility is secured from the Chinese Bank.”
He stressed that the project is commercial viable and the loan can be taken care off by its commercial nature.
When ask the possibility paying back the loans obtained to execute the project he said, “As I said earlier, this is project is very viable. The facility being taken is made to be repaid in 15 years but the project can pay itself in less than ten years because it is a commercial venture.
“You pipe this gas and you have gas flowing through, then go you to industries and power plants to source for buyers. To start with if you understand the mechanism of gas transportation, first there is tariffs to be paid for transporting the gas, and then for every cube meter of gas that passes through there is an amount that is paid by those who use it.
“In addition to that the gas itself will have to be paid for by those who use it. So it is commercially viable project it’s not the kind of a project that government will have to support for it to be viable,” he insisted.
Asked to speak on possible challenges the the project may encounter, he said, “Every project comes with its challenges there are challenges to build a project like this in virgin forest, to go through rivers, through rocks, to deal with security issues. This are challenges but I don’t have fears because we have the knowledge and experience to deal with it. We are very ready to deliver the project and deliver it on time.”
On his part, the Kogi state governor, Yahaya Bello, commended President Muhammadu for accepting that a local company to execute the gas pipeline laying project.
Speaking after unveiling the flag-off plaque in Ajeokuta, Gov. Bello said, “Awarding the contract to indigenous company, Oilserv Limited is something very wonderful and Mr. President should be commended for it.
He added that President Buhari is doing same thing in the agricultural sector, stressing that such actions will not only create jobs for the youths but help build the human capacity needed for the country’s industrialization.
Oilserv Limited, an indigenous company is lead a consortium of companies in the execution of EPC of the AKK pipeline project.
Prior to this the company has successfully delivered over 17 similar challenging projects in the country including the engineering, procurement and construction (EPC) of the 67 kilometre Obiafu/Obrikom to Oben (OB3) 48 inch diameter Gas Transmission Pipeline System.
The Oilserv consortium is slated to deliver the first 200 kilometre phase of the AKK pipeline which covers the section between Ajaokuta and Abuja, after securing the EPC contract in April 2018.