Nigeria has had several integration of fabrication production storage and off-take vessel (FPSO) projects undertaken on her behalf by multinational oil companies in many parts of the world especially in South Korea. Unfortunately, none of the major projects have been carried out in- county.
While the major projects are carried out in South Korea some other components of the integration facilities are done in other parts of the world only for them to be assembled in Korea. All these costs the country huge sums of money that run into several billions in foreign currencies and this has constituted a major source of capital flight to the country.
Nigerians are only deployed to the locations where the constituent parts are being constructed place across the globe just to see what is happening and ensure that the jobs are done to specifications. It is not as if they are sent there for training or to learn on-the-job so their roles are very limited to seating down and watching what is happening.
In some cases when some components had to be fabricated in Nigeria, they are shipped at very high costs to the yards in South Korea for integration. The implication of this is that Nigeria has been creating jobs for foreigners and boosting their economy through such projects.
Between 1999 and 2012 deepwater fields were developed by the joint venture companies through PSC arrangement for Yoho, Bonga, Agbami,Akpo and now Egina.
This time around the government has thought it wise to award the integration of fabrication production storage and off-take vessel (FPSO) of Egina to the joint venture of Lagos Deepwater Offshore Logistics service provider (LADOL) and the Korea based Samsung Heavy industries.
The intention is simple: to create employment opportunities for Nigerians and also for them to acquire technical skills. If the job is properly carried out this would create opportunities in future to domesticate the construction of such projects and Nigeria could be a hub for such activities for Africa since the whole of the African continent is almost an oil producing continent.
It is important to note that Nigerians are going to understudy the Korean experts that are going to set up the yard and run it for a period of years after which its operations would be transferred to Nigerians.
The stage appears set for the development of a $350m (about N57bn) Egina vessel platform integration in Lagos now following the final approval of the project by the Nigerian Ports Authority.
The project would turn around the fortunes of the oil and gas and maritime industries as well as the nation’s economy with its multiplier effects on other sectors. The whole drive for the project was the employment of Nigerians. The facility to be built will create markets for other businesses such as the steel production market.
Specifically, the construction which would kick off next month has the tendency to create five million jobs within the industry and another 50 million employment opportunities outside the sector. The site for the construction has been cleared.
According to Amy Jadesimi, managing director of LADOL, the company had established a training centre to prepare the personnel needed for the FPSO project and other related maritime activities, adding that “we already have junior and senior engineers. A moderately furnished hostel consisting four blocks of 96 rooms has been constructed at the Lagos site of the FPSO project.”
Jadesimi, who led journalists on a facility tour of the fabrication site at LADOL base in Lagos, noted that the choice of the organisation for the unique project was informed by its track record of servicing major oil and gas companies logistics requirements, one of which was the final integration of the famous Agbami Oil Field facility.
According to the LADOL boss, NPA had earlier granted an approval for the detailed design of the FPSO fabrication yard in August. The organisation had to sign 19 separate agreements with Samsung over three years with the active involvement of seven separate Nigerian and international lawyers, financial advisors and consultants.
Its total investment at LADOL to date is $102.5m and with this being the only logistics based company owned 100 percent by Nigerians and the only one to develop from a zero value Greenfield NPA site into a $500m world class base, the company says it is not disturbed.
Series of findings and vessel simulation carried out along the Apapa ports coastline have revealed that apart from being the only fully indigenous-owned body of its kind in the country, LADOL base is the ideal site in Nigeria for berthing a vessel of the size of an FPSO.
Jadesimi further revealed that the international ships and ports security certified facility, had the support of all relevant government agencies for the project, adding that they are permanently present in the zone.
LADOL is already servicing oil and gas majors, contractors and service companies. The largest FPSO in Nigeria – Agbami – got some support from LADOL when it was being developed. The company is now expanding its facilities and business model into Bayelsa State as well as extending its facility in Lagos.
Information from Business Day was used in this report.