NSIA signs agreements with NNPC, others to develop $1.4 billion fertilizer plant
The Nigeria Sovereign Investment Authority (NSIA) has signed pacts with the OCP of Morocco, Nigerian National Petroleum Corporation (NNPC) and some parties for the development of a $1.4 billion plant to produce Ammonia and Diammonium Phosphate.
Other parties to the agreement are the Nigerian Content Development & Monitoring Board (NCDMB), GACN (Gas Aggregation Company Nigeria Limited), Akwa Ibom State Government, the Fertilizer Producers & Suppliers Association of Nigeria (FEPSAN) and Mobil Producing Nigeria (MPN).
This was disclosed by NSIA via a statement issued on Wednesday and seen by Nairametrics.
Here are 5 agreements executed:
- A Memorandum of Understanding (MOU) between Nigeria Sovereign Investment Authority (NSIA), OCP Africa and the Fertilizer Producers and Suppliers Association of Nigeria (FEPSAN) to commit to the second phase of the Nigerian Presidential Fertilizer Initiative (PFI II).
- A Shareholders Agreement (SHA) between the NSIA and OCP Africa for the creation of the Joint Venture Company (JVC) which will oversee the development of an industrial platform that will produce ammonia and fertilizers in Nigeria.
- An MOU between NSIA, OCP Africa and the Akwa Ibom State in Nigeria on land acquisition, administrative facilitation, and common agricultural development projects in the Akwa Ibom State.
- An MOU between NSIA, OCP Africa, and the Nigerian National Petroleum Corporation (NNPC), to evaluate the opportunity of an equity investment by the NNPC in the JVC and for its support on gas.
- A Framework Agreement between NSIA, OCP Africa, Mobil Producing Nigeria (MPN), the NNPC and the Gas Aggregation Company Nigeria (GACN) on gas supply for the MPI
On the development, Timipre Sylva, Minister of State for Petroleum and head of the Nigerian delegation said, “President Buhari is very committed to actualisation of this project. He has mandated the Ministry of Petroleum Resources and all its agencies, notably the NNPC, DPR, NCDMB and all other government agencies to give maximum support for this project.”
Chairman and CEO of OCP, Dr. Terrab said, “Ultimately, these agreements will strengthen the partnership between the NSIA and OCP Group and the different institutions in the gas industry in Nigeria.
“The outcome of the agreements will translate to knowledge transfer and broader economic opportunities as we build out the industrial platform. The platform will leverage the best of Nigerian and Moroccan natural resources, namely the Nigerian gas and the Moroccan phosphate and create a new basis for stronger ties.”
Uche Orji, CEO, NSIA said, “The project forms a key part of NSIA’s gas industrialisation strategy and will deepen intra-continental trade which is essential to Africa’s development and economic renaissance.
“The project will explore increased levels of synergy between NSIA and OCP and the partners to the transactions and ultimately ensure that Nigeria builds an industrial base that is sustainable and complementary to mutual objectives of developing the agriculture sector in Nigeria.”
What it means
- The first two agreements relate to the second phase of the Presidential Fertiliser Initiative (PFI II), while the last three contracts underpin the creation of a Multipurpose Industrial Platform (MPI) to be sited in Akwa Ibom State.
- The agreements on the second phase of the PFI give effect to the presidential directive, which has restructured the PFI programme. Under the revised structure, NSIA’s role moves upstream thereby limiting its involvement to bulk importation of raw materials on behalf of the fertilizer blenders, with bank guarantees provided by the blenders.
- This approach, according to NSIA, will make the programme more sustainable, strengthen the productive capacity of the blending plants and eliminate financial risk to the NSIA.
- Agreements are expected to cement the joint resolve of President Muhammadu Buhari and His Majesty, King Mohamed VI, King of Morocco to develop a Multipurpose Industrial Platform project in Nigeria.