Pinnacle Oil and Gas Limited, the company developing a revolutionary mooring infrastructure for ships with petroleum products at the Lekki Free Trade Zone, Lagos last week signed a pact with consortium of banks that will fund the project.
The local banks that are working with off-shore financiers are: Diamond Bank, FCMB and IBTC and the project cost is put at about $250 million.
Managing Director/Chief Executive Officer, Pinnacle Oil and Gas Limited, Mr. Peter Mbah said his company is building a critical infrastructure and “we want the people at the oil and gas zone to take ownership of it; we want them to be part of it and to protect it because this is critical for them to operate at the zone.
According to him, Pinnacle was open to working and synergizing with other tank farm owners and new investors.
Mbah said his company has an ultra-modern storage facility in Warri, Delta State, stating that it has “a radar-gauging system with a mass flow meter and that the company has delivered some huge and successful projects in the past.
He said, “With our pioneering mentality and our value innovation approach, we have identified the huge supply chain infrastructural gaps and have taken adequate steps to bridge these gaps, by the development of a world class Single Point Mooring (SPM) and Conventional Buoy Mooring (CBM) which are capable of receiving up to 150,000DWT vessels with the ability to discharge up to 100,000MT of petroleum products within 48 hours. We are indeed poised to play the lead role as major providers of petroleum products supply chain infrastructure.”
He said the project would be completed next year and that though the project began in 2012, physical construction works such as installation would take three or four months, saying there would be pre-commissioning and commissioning process that may take the project to the end of next year.
Mbah said the critical items for the project have “all been procured; the detailed design is done; all the survey, data gathering; and ocean investigation have all been done.”
He said, “All that is going on now is the manufacturing of the line pipes; the final stages of the fabrication of the Single Point Mooring (SPM) and Conventional Buoy Mooring (CBM), explaining that these facilities are being done off-shore.
Speaking on the project and the financial arrangement, the Managing Director of JE Consortium Limited, Mr. Joseph M. Ejim said his company provides “bespoke infrastructure finance solutions.
According to Ejim, “Before now Nigeria had an inefficient system where vessels cannot come into the custom area to discharge their products because the jetties were too narrow and too shallow.”
On account of this, he said it usually took a minimum of one month to up to three months for one steady 50ton metric capacity vessel to discharge their cargo, saying “it costs the tax payer money because most of the subsidy of the Federal Government of Nigeria goes into paying demurrage.”
He said the traffic gridlock in Apapa, caused by tankers that bridge petroleum products, brings life to a standstill in that part of Lagos, describing it as disaster.
What the promoters of the project tries to achieve with the project, he said was to put in place and efficient and modern way of handling petroleum products that would take away all the current negative situations that is experienced in Apapa.
He said the facility would have two mooring systems, adding that the single mooring system would be for bigger vessels of up to 250 metric tons and that the conventional buoy mooring system would be for smaller vessels of 20 to 50 metric tons.
Both mooring systems, he said can operate simultaneously, explaining that “the mooring facilities would be linked by a 40-kilometer pipeline to a 600,000 metric ton storage facility at the Lekki Free Trade Zone.
“The new system would be, instead of 21-day turn around cycles for one small shuttle vessel of 5000 metric tons to go to the mother vessel and pick up small cargo to the tank farms in Apapa or Ibafo, the big vessels will come in directly, anchor at the mooring facility, connect their hoses to the pipeline and discharge and leave that place within 24 to 48 hours.”
He said if there was need to evacuate products, for instance, to a tank farm in Apapa, “this will be done by the normal 5000 metric ton small vessels that can feed from the conventional buoy mooring facility.
Another unique feature of the mooring systems is that cargo can also be taken from there to all the coastal states, he said, adding that products could also be taken to the eastern parts of the country- Akwa Ibom, Bayelsa, Rivers, Cross River, among others.
He said this interesting development would cut down “maybe by up to 50 per cent the number of trucks on our roads and this will save our roads. There are all kinds of advantages in the project.”
Ejim said the project, which cost is about $250 million, has a cycle of 24 months and that “we hope to start construction by January, (2016).”
He described the project’s promoter, Pinnacle Oil and Gas Limited as a wholly indigenous Nigerian-owned company, adding that they are into logistics/transport infrastructure from the midstream to downstream aspect of the oil and gas business in Nigeria and have been in business since 2005.”
The project is expected to provide lots of jobs, he said and that it would reduce operating costs for all tank farms as they would not longer pay demurrage.
The project would also be available for the evacuation of products when Nigeria begins to export them, he said.