Nigeria government investigates $10-B Chevron gas project
6/9/2016
Chevron Nigeria Ltd. has been asked by a Nigerian senate committee to explain why an original cost estimate of $3 B for the Escravos gas-to-liquids (GTL) facility ballooned into a $10.3 B investment.
The 33-Mbpd Escravos GTL plant began production in mid-2014, producing mainly synthetic diesel. The plant supplies clean-burning, low-sulfur diesel fuel for cars and trucks, Chevron said.
The national gas committee chairman, Bassey Akpan, said at a meeting in the capital, Abuja, that the joint venture (JV) contract terms may have been violated because partner Nigerian National Petroleum Corp. (NNPC) was not consulted on running over budget.
Monday Ovuede, the director of the NNPC and Chevron Nigeria JV, said that Chevron had acted in a “reasonable and prudent manner” in carrying out the project. He added that NNPC officials failed to attend several meetings and decisions had to be made to go ahead.
Sasol Ltd., which had a 27.5% stake in the venture, sold its holding to Chevron in 2008 after the project’s cost more than doubled.
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