Reps C’ttee queries $10.7bn gas-to-liquids project

OIL & GAS
An ad hoc committee of the House of Representatives on Tuesday queried the implementation of the Escravos gas-to-liquids (EGTL) Gas Project.
The committee said the project which should cost 2.9 billion dollars was quoted as 10.7 billion dollars.
The committee on the Joint Venture of the NNPC limited, raised concerns when the management of Chevron Nigeria Limited appeared before the lawmakers in Abuja.
The Chairman of the committee, Rep. Hassan Fulata (APC-Jigawa), demanded for explanation and the reasons behind the review of the cost of the project from $2.9 billion to $10.7 billion.
Responding, Chevron’s Director of Joint Venture, Mr Monday Ovuede, told the committee that several factors caused the upward review of the cost of the project from the initial $2.9 billion to $10.7 billion.
Ovuede explained that immediately after the project was signed, prices of commodities like oil and steel went up, necessitating an upward review of the project.
He added that Chevron agreed to a value-for-money audit despite not having it in the contract for the project.
On the Qatar project, Ovuede explained that the project was built in an industrial complex with a seaport and access to an international airbase.
According to him, there was access to skilled labours compared to Nigeria, but such skills were hard to come by.
Inspite of the explanations, the legislators remained dissatisfied and requested for documents to back the claims.
Rep. Ibrahim Isiaka (APC-Ogun) moved a motion for Chevron to submit a written response justifying the increment.
In his ruling, Fulata alleged that Chevron was claiming capital allowance for the project without capital importation or a certificate to make such a claim.
He ruled Chevron should appear again on Tuesday, Oct. 11 with relevant documents to defend its claims. (NAN)