ROYAL DUTCH SHELL PLC (RDSA) has signed a deal for a $101mn pipeline project in Nigeria aimed at delivering gas as the government seeks to further exploit its huge natural reserves, the company said Monday.
The contract with Saipem Contracting Nigeria Limited is for a 42-kilometer (26-mile) pipeline to gather gas currently being burned off for use in Nigeria's domestic market.
Much of the natural gas in Nigeria is currently flared -- burned off -- in part because of a lack of infrastructure to process it.
The government wants to boost electricity production with gas-fired power plants as well as export more of the natural resource. President Goodluck Jonathan has spoken of those goals as part of his campaign ahead of elections this Saturday.
"This is an extremely important project for (Shell) in terms of our commitment to ending routine gas flaring and consolidating our leadership position in the domestic gas market," said Shell managing director in Nigeria Mutiu Sunmonu.
It said it had previously awarded a contract for engineering, procurement and construction of the gas compression and processing plant to Daewoo Nigeria Ltd in October and that work was progressing.
The country's gas reserves have been estimated as the world's eighth-largest. Nigeria is Africa's largest oil producer.
