KOWA YA TUNA BARA!
A Special Investigation by Alfijir Labarai
EDITION 6
1. WHY DID GAS BECOME AN IMPORTANT GOVERNMENT PRIORITY?
In the 1990s, Nigeria’s economy was heavily dependent on crude oil.
In his Independence Day address of 1 October 1997, General Sani Abacha stated that his administration was pursuing policies aimed at moving the economy away from excessive dependence on crude-oil exports.
He specifically linked this objective to several gas-based projects, including the Liquefied Natural Gas (LNG) project, the Escravos Gas Project, the West African Gas Pipeline Project and petrochemical projects.
But this investigation asks three important questions:
What was initiated during the period?
What progressed during the period?
And which results emerged only after 1998?
2. NLNG: IT WAS NOT ESTABLISHED DURING THE ABACHA ADMINISTRATION
This is an important historical distinction.
Nigeria LNG Limited was not established by the Abacha administration.
Official NLNG records identify May 1989 as the incorporation date of Nigeria LNG Limited.
However, a major investment milestone came during the Abacha administration.
In November 1995, NLNG shareholders took the Final Investment Decision (FID) to build the LNG plant at Finima, Bonny Island.
Construction of the plant commenced in February 1996.
Therefore, it would not be accurate to say:
“Abacha established NLNG.”
The documented position is:
NLNG was incorporated in 1989, while the FID for Trains 1 and 2 was taken in 1995 and construction began in 1996, during the Abacha administration.
3. NLNG: CONSTRUCTION BEGAN IN 1996, BUT PRODUCTION AND EXPORTS CAME AFTER 1998
The construction of Trains 1 and 2 began in February 1996.
The first Gas Transmission System was completed in September 1998.
However, LNG production did not begin during the Abacha administration.
According to NLNG’s official timeline, Train 2 was ready for start-up in August 1999 and LNG production began on 15 September 1999.
The first LNG cargo was exported in October 1999.
Train 1 subsequently came on stream on 27 February 2000.
This provides an important historical distinction:
A major stage of the NLNG project was undertaken during the Abacha period, but LNG production and the first export cargo came after 1998.
4. ESCRAVOS GAS PROJECT: AN IMPORTANT MILESTONE IN 1997
In his 1997 Independence Day address, Abacha mentioned the Escravos Gas Project among the gas-based projects on which his administration said significant progress had been made.
Contemporary industry records show that the first phase of the Escravos Gas Project began processing gas in November 1997.
The first phase was designed to process about 165 million cubic feet of gas per day, producing Natural Gas Liquids (NGL) and condensate.
The project was a joint venture between NNPC and Chevron, with NNPC holding 60 percent and Chevron 40 percent at the time.
This represents a documented operational milestone during the Abacha administration.
5. WHAT DID THE ESCRAVOS PROJECT SEEK TO ACHIEVE?
The Escravos project involved the gathering and processing of associated gas from oil production.
Contemporary records described the project as an effort to utilise a significant portion of Nigeria’s gas resources and reduce gas flaring.
Its first phase processed associated gas and produced LPG/NGL and condensate for economic use.
This is significant because it illustrates an effort to move associated gas from being treated primarily as a by-product of oil production towards productive economic use.
6. ELEME PETROCHEMICALS: ESTABLISHED BEFORE ABACHA
The historical record requires another important distinction.
The Bureau of Public Enterprises states that the Federal Government, through NNPC, established Eleme Petrochemicals Company Limited (EPCL) in 1991 to implement Phase II of Nigeria’s three-phase petrochemical development programme.
However, the company was commissioned in 1996, during the Abacha administration.
Therefore, we should not say that Abacha established Eleme Petrochemicals.
The documented position is:
EPCL was established in 1991, but commissioned in 1996, during the Abacha administration.
7. WHAT WAS ELEME PETROCHEMICALS DESIGNED TO PRODUCE?
According to the Bureau of Public Enterprises, EPCL was designed to manufacture olefins and polyolefins derived from Natural Gas Liquids and Propylene Rich Feed.
Its principal products included:
Polyethylene (PE)
Polypropylene (PP)
The plant had a stated plate capacity of 240,000 metric tonnes of polyethylene and 80,000 metric tonnes of polypropylene.
These materials are basic inputs for plastics and a wide range of consumer and industrial products.
The broader objective was to add value to Nigeria’s hydrocarbon resources by converting them into industrial products rather than relying solely on crude-oil exports.
However, commissioning should not be confused with full operational success.
BPE records state that EPCL did not operate to its potential during its period under government ownership and was later privatised in 2006.
8. WEST AFRICAN GAS PIPELINE: AN IMPORTANT DISTINCTION
In his 1997 address, Abacha mentioned the West African Gas Pipeline Project among the gas projects on which his administration said progress had been made.
However, this does not mean that the pipeline was constructed or completed during the Abacha administration.
World Bank project records show that important implementation milestones came much later, including the Intergovernmental Agreement in 2000, the WAGP Treaty in 2003, the Final Investment Decision in December 2004, and the commencement of offshore construction in August 2005.
Therefore, in this investigation, WAGP is presented as a project identified by the government in 1997 as making progress, rather than as a pipeline completed during the Abacha era.
9. DID NIGERIA’S MANUFACTURING SECTOR RECOVER?
This is where Central Bank of Nigeria data provides an important broader picture.
CBN data shows manufacturing growth of:
1995: -5.5%
1996: 1.3%
1997: 0.4%
1998: -3.9%
The same CBN study records average manufacturing capacity utilisation of 31.8% for 1996–1998, while manufacturing’s share of GDP averaged 6.3% during the period.
Therefore, it would be inaccurate to state:
“Manufacturing was fully revived during the Abacha era.”
The CBN figures do not support such a broad conclusion.
What the evidence shows is more specific:
There were important developments in gas and petrochemicals during the period, but the manufacturing sector as a whole continued to face weak growth and low capacity utilisation.
10. WHY DOES THIS MATTER?
Gas and petrochemicals can contribute to an economy by:
adding value to domestic resources;
providing industrial feedstock;
reducing gas flaring;
creating additional sources of revenue from natural resources;
and supporting other areas of economic activity.
However, the commencement of major gas projects does not mean that all industrial challenges were solved.
CBN data shows that Nigeria’s manufacturing sector continued to face significant difficulties during 1996–1998.
11. WHAT DID THE ABACHA ADMINISTRATION SAY IN 1997?
In his 1997 Independence Day address, Abacha described the administration’s economic agenda as an effort to move Nigeria away from excessive dependence on a single export product — crude oil.
He linked this objective to several gas-based projects, including:
Liquefied Natural Gas;
Escravos Gas Project;
West African Gas Pipeline;
and petrochemical projects.
This represents the position of the administration at the time.
Alfijir Labarai has examined the NLNG, BPE, CBN, World Bank and contemporary project records to distinguish between what the government announced as policy and what the available records show was actually initiated, implemented or completed.
12. WHAT WAS INITIATED, AND WHAT CAME AFTER 1998?
When the evidence is put together, the timeline becomes clearer:
NLNG: incorporated in 1989; FID for Trains 1 and 2 in 1995; construction began in 1996; production began in September 1999; first LNG cargo was exported in October 1999.
Escravos Gas Project: its first phase began processing gas in November 1997.
Eleme Petrochemicals: established in 1991 and commissioned in 1996.
West African Gas Pipeline: the Abacha administration referred to progress on the project in 1997, but major implementation and construction stages occurred after 1998.
Manufacturing: CBN data shows that the wider manufacturing sector did not experience strong growth in 1996–1997 and continued to operate with low capacity utilisation.
13. WHAT SHOULD WE REMEMBER?
Edition 6 shows that gas and petrochemicals formed an important part of the Abacha administration’s stated effort to reduce Nigeria’s dependence on crude-oil exports.
But the history did not begin in 1993, and it did not end in 1998.
NLNG was incorporated in 1989, while the FID for Trains 1 and 2 was taken in 1995 and construction began in 1996.
The Escravos Gas Project reached an operational milestone in 1997, when its first phase began processing associated gas.
Eleme Petrochemicals was established in 1991 but commissioned in 1996.
At the same time, LNG production and the first LNG export cargo came after 1998, while CBN data shows that manufacturing as a whole continued to face serious challenges.
Therefore, the most evidence-based conclusion is:
The Abacha administration was in office during an important phase in the development of Nigeria’s major gas and petrochemical projects, particularly when significant investment and construction decisions were being made; however, some projects originated before its tenure, while some of their major results emerged after 1998.
KOWA YA TUNA BARA!
History is not only about what we choose to remember.
History is about what documents, records and evidence allow us to establish.
In this Edition 6, Alfijir Labarai examines gas, LNG and petrochemicals to establish what was initiated, what progressed, and what significant results emerged after the Abacha administration.
Sources: Nigeria LNG Limited; Bureau of Public Enterprises; Central Bank of Nigeria; World Bank; Archivi.ng; Oil & Gas Journal; and historical records on the Escravos Gas Project.
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