The company is expected to complete the $250 million SPM facility with over 11 kilometres of subsea and on shore pipeline network by December 2013 when many of the tank farms proposed for the Zone would have also been completed.
This is according to a joint memorandum of understanding (MoU) Pinnacle Oil and Gas has signed with Lekki Free Trade Zone Company (LFTZC) Limited and the China Petroleum Technology and Development Corporation (CPTDC).
Mr. Peter Mbah, managing director of Pinnacle Oil and Gas Limited, who spoke at the signing ceremony of the MoU in Lagos, said the $250 million Single Point Mooring (SPM) facility demonstrated the technical knowledge and financial strengths of the indigenous company.
He said the partnership with the China Petroleum Technology Development Corporation (CPTDC) and Lekki Free Trade Zone Company (LFTZC) Limited would further develop the Nigerian downstream oil sector as the free zone provided a more convenient alternative to loading of oil products.
He noted that the Single Point Mooring facility at Lekki Free Zone would enable petroleum cargo vessels of various capacities to anchor and discharge products via the network of undersea and onshore pipelines to respective tank farms.
According to Mbah, “The Lekki Free Zone SPM couldn’t have come at a better time than now that government is withdrawing subsidy on petrol. Considering that factors which impact on the product price like demurrage and littering of cargo-using small vessels to take products from bigger vessels that cannot dock at the jetty due to the shallow draught, would be eliminated therefore reducing the landed cost of petroleum products quite considerably,”
Also speaking at the event, Mr Chen Xiaoxing, Managing Director, Lekki Free Trade Zone Company Limited, stressed the the strategic importance and location of the free zone as Nigeria’s new economic hub.
He said that with the congestion and the environmental hazards posed by the proliferation of petroleum products tank farms at the Apapa/Kirikiri axis, industry operators have found the Lekki Free Zone the most suitable alternative especially considering its location at the outskirts of Lagos and with proximity to the Ijebu Ode axis from where most trucks come to load petroleum products in Lagos.
The absence of mooring and discharge facilities at the Zone has denied oil and gas operators opportunity to tap the benefits of Lekki Free Zone, he said, adding that the SPM would address this challenge and enhance the position of the zone as major economic catalyst.
Managing Director, China Petroleum Technology and Development Corporation Nigeria Limited (CPTDC), Mr John Cooper, said the MoU was in furtherance of the commitment of the company to development of Nigerian downstream oil sector, especially working with credible indigenous oil and gas firms like Pinnacle.
Lekki Free Zone (LFZ) is a joint venture between the China Corporation, which holds 60 percent stake, Lagos State Government and Federal Government of Nigeria, which hold 20 per cent stake each.