ICBC pledges $75 million loan for Utorogu Gas Processing Facility Project

Project narrative

On April 8, 2016, Southfield Petroleum Limited signed an EPC contract for the Utorogu Gas Processing Facility Project with China Machinery Engineering Corporation (CMEC). Then, on November 10, 2016, CMEC and Southfield Petroleum Limited executed a $198 million commercial contract for the Utorogu Gas Processing Facility Project. In August 2017, ICBC agreed to finance $75 million, or at least 30%, of the Utorogu Gas Processing Plant turnkey EPC contract between China Machinery Engineering Corporation (CMEC) and Southfield Petroleum Limited in Nigeria. The project involves the processing of the 300 million standard cubic feet per day (300MMScfd) for the Utorogu Gas Field (OML 34), which is a major supplier of gas for electricity generation in Nigeria. It also feeds gas through the West Africa Gas Pipeline to neighboring countries. ICBC has reportedly agreed in principle to support this project with “long-term export finance”. According to Southfield, the EPC contract also includes the construction of other facilities like a captive Jetty, 24 Mega Watts captive power, a 14,000metric tonnes Liquefied Petroleum Gas (LPG) storage facility, 3,000 metric tonnes LPG barge, office buildings, infrastructure, the construction of an Amine Unit to extract the Carbon Dioxide from the gas as well as a robust training programme for Nigerians. Utorogu gas field is expected to be operational by Q2 2018 with a projected annual production of 200,000MT of LP. The plan is to have the facility operated by CMEC for the period when the Nigerian staff undergo training to achieve seamless technology transfer and capacity development.