The Nigerian National Petroleum Corporation (NNPC) has said that the execution of the strategic Ajaokuta-Kaduna-Kano gas pipeline project is 100 per cent contractor finance. The Corporation said this in a statement issued by its spokesman, Mr Ndu Ughamadu, in Abuja.
It said that the contractor finance arrangement was still intact noting that the Engineering Procurement Construction (EPC) contractors and possible lenders were currently in Dubai to discuss the financing terms. Commenting on the `proceed of gas Tariffs’, it said that the application of revenue generated from the tariff would be purely for loan repayment since the project financing was “Contractor finance”.
‘’We wish to further clarify that part of the approvals obtained from the Federal Government is to fund the implementation of the project front-end activities tagged “Early Works” in order to continue to move the project forward pending the conclusion of the financing negotiations,’’ the Corporation explained It further clarified that the amount spent for the early works would be recovered immediately the loans disbursement starts adding that no part of tariff would be spent on the project until the end of the loan moratorium period.
The Corporation restated its commitment to actualising the AKK project as approved and in line with the Federal Government’s desire to improve the supply of gas nationwide. This, it said, would thereby enhance power generation, economic growth and employment opportunities.
