Nigeria’s First Floating LNG Plant Locks In Its Gas
NIGERIA · ENERGY
Key Facts
—The deal: UTM Offshore signed a 15-year agreement with NNPC and Seplat Energy for 200 million standard cubic feet of gas a day, feedstock for Nigeria’s first indigenous floating LNG project.
—The site: The plant will moor at the Yoho field, OML 104, offshore Akwa Ibom State, and liquefy 1.8 million tonnes of LNG a year.
—The cost: The project is estimated at about $3 billion, with debt from Afreximbank and equity from NNPC and the Delta State government.
—The owners: UTM Offshore holds 72 percent, NNPC 20 percent and Delta State 8 percent; founder Julius Rone leads the venture.
—The clock: A final investment decision is targeted for the fourth quarter of 2026, with first LNG cargoes planned for 2030.
Nigeria’s first floating LNG plant has secured the one thing no gas project can live without: feedstock. UTM Offshore signed a 15-year deal on July 7 for 200 million cubic feet of gas a day from NNPC and Seplat Energy, clearing the path to a final investment decision this year.
A floating LNG plant, fed at last
The wet gas sale and purchase agreement was signed on the sidelines of Nigeria Oil and Gas Energy Week in Abuja. A joint venture of NNPC, the state oil company, and Seplat Energy Producing Nigeria Unlimited will deliver 200 million standard cubic feet a day for 15 years.
The gas comes from the Yoho field in oil mining lease 104, offshore Akwa Ibom State in Nigeria’s southeast. A floating facility moored at the field will chill it into liquefied natural gas for export.
Cooled to minus 162 degrees Celsius, natural gas shrinks to a six-hundredth of its volume and can sail to any port with a regasification terminal. That flexibility is what has made LNG the world’s swing fuel.
Energy Intelligence reports the vessel is expected to turn out about 176 million cubic feet a day once operational, slightly below the contracted feed volume. Processing consumes part of the incoming stream.
Why floating, and why it matters
A floating LNG plant is a liquefaction factory built into a ship’s hull, parked directly over offshore gas. It skips the pipelines, land acquisition and onshore construction that have delayed African gas projects for decades.
For Nigeria, which holds Africa’s largest natural gas reserves, the model is a way to monetise offshore gas that would otherwise be flared or left in the ground. The country’s only existing LNG exporter, the six-train NLNG complex on Bonny Island, is a consortium built a generation ago.
Only a handful of floating plants operate worldwide, and Africa already hosts one of the proofs of concept. Eni’s Coral South vessel has been shipping LNG from Mozambican waters since 2022.
Who is behind it
UTM Offshore is led by its founder, Nigerian businessman Julius Rone, and holds 72 percent of the project. NNPC owns 20 percent and the Delta State government 8 percent.
The venture has lined up debt financing from Afreximbank, the Cairo-based trade bank that has become the continent’s go-to lender for energy projects Western banks now avoid. The plant is expected to produce 1.8 million tonnes of LNG a year.
Rone has spent years assembling the project against scepticism that a Nigerian independent could deliver LNG. The Afreximbank commitment answered the hardest question early: who would fund it.
The road to a final decision
With feedstock secured, the company is targeting a final investment decision in the fourth quarter of 2026. First cargoes are planned for 2030, and the project is estimated at about $3 billion, per Businessday’s report on the agreement.
Long-term supply certainty is what lenders demand before committing billions to a liquefaction plant. The 15-year contract is therefore less a formality than the project’s financial foundation stone.
The politics are aligned too. Abuja has branded this its “Decade of Gas”, pushing commercialisation of reserves as the bridge between oil dependence and renewables.
Why it matters
Global LNG demand keeps climbing as Europe and Asia bid for non-Russian gas, and Africa’s share of supply remains far below its share of reserves. An indigenous-led Nigerian export project — funded by an African bank, fed by a Nigerian field — is a milestone in the continent financing its own energy industry.
It also deepens a pattern The Rio Times follows closely in its Africa: The New Scramble pillar: as Western majors retreat from African fossil fuels, local players and pan-African institutions are stepping into the gap.
There is a cleaner-air dividend in play as well. Gas flares have burned off Nigeria’s coastline for decades, and projects that turn stranded molecules into export revenue attack the waste and the emissions at once.
Latin American readers will recognise the play from Argentina, where floating vessels are turning Vaca Muerta shale gas into seaborne exports. Both shores of the South Atlantic are converging on the same technology.
Frequently asked questions
What gas deal did UTM Offshore sign?
A 15-year wet gas sale and purchase agreement with NNPC and Seplat Energy for 200 million standard cubic feet a day, signed on July 7, 2026 in Abuja. The gas feeds Nigeria’s first indigenous floating LNG project.
Where will Nigeria’s first floating LNG plant operate?
At the Yoho field in oil mining lease 104, offshore Akwa Ibom State. The facility will liquefy about 1.8 million tonnes of LNG a year.
Who owns the UTM FLNG project?
UTM Offshore holds 72 percent, NNPC 20 percent and the Delta State government 8 percent. Afreximbank is providing debt financing for the roughly $3 billion project.
When will the plant ship its first LNG?
A final investment decision is targeted for the fourth quarter of 2026, with first cargoes planned for 2030.
Connected Coverage
Nigeria’s energy reset is a running story: Seplat itself just went through a leadership shake-up that hands Tony Elumelu the chair, Africa launched its own energy bank to fund oil and gas, and Nigeria became the first OPEC nation to join the IEA.
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