NIGER – the State of Niger signed the Transport Convention on the construction and exploitation of the upcoming pipeline linking Niger’s Agadem Rift Basin to Benin’s Port Seme. The agreement was signed with the China National Petroleum Corporation’s overseas development arm, CNODC.
This is the largest ever cross-border crude oil pipeline investment and is also the key to Niger multiplying its crude oil production by five over the next few years, from its current 20,000 bopd to 100,000 bopd.
The 1,893.9km pipeline, 70% of which will be laid in Niger, will cost $4.5bn (FCFA 2,4000bn) and will be exporting first crude oil from Agadem to the Atlantic Coast in 2021. The project will create about 5,000 jobs, and comprises seven electricity stations, 1,557km of high-tension electricity lines, and a new airport at Koulélé.
The agreement follows the signature of the Niger-Benin Pipeline Construction and Operation Agreement with the CNPC last August, and the approval of the Agadem PSC Exclusive Exploitation Area 3 in June 2018.
Executive Chairman at the African Energy Chamber and CEO of the Centurion Law Group, NJ Ayuk stated; “By giving Niger’s oil an access to export markets, the pipeline is set to unlock billions of dollars of investment into the discoveries made in the country over the past few years, and transform the country into a regional oil hub. This means jobs and local content for the people of Niger.
“This is going to be a transformational deal. We are happy that Niger will benefit greatly from the increase of the oil industry’s contribution to the country’s economy. Some have floundered and some have done very well when it comes to Africa’s oil story,” added Mr Ayuk.
The laying of the pipeline goes in line with a plan to drill 430 wells and build a treatment center in Koulélé and a dehydratation station in Dibella.
“From a Savannah perspective, it provides our company with a significant additional potential route to market, alongside the existing Zinder refinery, for our existing and future discoveries in Niger,” declared Savannah Petroleum CEO Andrew Knott in a statement stating the benefit of the pipeline.
According to a petroleum policy document released in early 2019, Niger ambitions to grow petroleum’s contribution to its GDP from 4% in 2017 to 24% in 2025, with state revenues from oil increasing from 19% to 45% and export revenues from 16% to 68%.
