oil and gas

Boost for $2.8bn AKK Project as Train Delivers Gas Pipes

April 14, 2021

For the first since its take-off last year, the $2.8 billion Ajaokuta-Kaduna-Kano (AKK) gas pipeline project received a boost recently when a Nigerian Railway Corporation (NRC) operated train delivered 96 pipes from Warri, Delta State to Itakpe in Kogi State.

The Ajaokuta–Kaduna–Kano (AKK) project is a 614km-long pipeline being developed by the Nigerian National Petroleum Corporation (NNPC) to transport natural gas from southern Nigeria to central Nigeria and thereafter outside the country.

It is planned to be developed on a build-own-operate-transfer (BOOT) basis under a public-private partnership (PPP), supervised by Nigeria’s Infrastructure Concession Regulatory Commission (ICRC).

With the new development, aside the respite for the networks of roads between Warri and Itakpe, the pipelines which mostly come through the Warri ports will now be delivered in less than eight hours at 50km/hour, instead of the four days spent by heavy duty vehicles.

The project is being financed through an 85 per cent debt and 15 per cent equity arrangement, with a loan facility from the China Export & Credit Insurance Corporation (Sinosure) at London Interbank Offered Rate (LIBOR) interest rate plus 3.7 period with a 12-year repayment period .

It is being handled by a consortium of two local companies including Oando and Oilserv and another consortium comprising Brentex and China Petroleum Pipeline Bureau (CPP).

Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kyari, who expressed excitement over the development, noted that it would now cost less to deliver the materials.

“We congratulate our team on the arrival at 10.25pm 8.4.2021 of AKK gas project line pipes by rail from Warri to Itakpe. Less cost, faster delivery time, safer, protecting our roads and more. The infrastructure revolution is paying up,” he stated on his personal Twitter handle.

Describing it as epoch-making and a major boost, the NNPC stated that the 96 pipes carried by rail at once was equivalent to 32 trailers if the haulage was done by road.

On completion, the AKK pipeline is expected to transport about 3,500 million cubic feet (mcf) of gas a day from various gas gathering projects in southern Nigeria to be used in the north.

The rail line from Warri, passing through Itakpe, Ajaokuta and Agbor has six stations along the route and was initially built to ensure steel products and raw materials transportion from the Delta Steel Company (DSC) which is now comatose.

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