B -- NIGERIA: DOMESTIC GAS UTILIZATION FUEL FEASIBILITY STUDY

Notice Date

November 7, 2000

Contracting Office

USTDA, 1621 N. Kent Street, Suite 200, Arlington, VA 22209-2131

ZIP Code

22209-2131

Response Due

December 22, 2000

Point of Contact

POC Evangela Kunene, USTDA, Tel: (703) 875-4357, Fax: (703) 875-4009.

Description

Mr. Mac A. Ofurhie, Managing Director, Nigerian Gas Company Limited, Odin Road, Ekpan, Nigeria, Phone: (234-53) 252-224, Fax: (234-53) 252-233 B -- Nigeria: Domestic Gas Utilization Fuel Feasibility Study POC Evangela Kunene, USTDA, 1621 N. Kent Street, Suite 200, Arlington, VA 22209-2131, Tel: (703) 875-4357, Fax: (703) 875-4009. Nigeria: Domestic Gas Utilization Fuel Feasibility Study. The Grantee invites submission of qualifications and proposal data (collectively referred to as the "Proposal") from interested U.S. firms which are qualified on the basis of experience and capability to develop a feasibility study for a domestic gas utilization fuel project in Nigeria. Experts believe that gas is Nigeria's dominant energy resource. However, Nigeria is located at a distance from all industrial countries that rely on natural gas and there is a sizable shipping distance for potential liquefied natural gas (LNG) transport to countries with sizable markets. It was only at the end of 1999 that LNG shipments to Europe were started and only this year that the West Africa Gas Pipeline Project for gas exports to Ghana, Benin and Togo is undergoing serious negotiation. It is timely that Nigeria increases considerably its domestic natural gas usage to gain value from this sizable and presently wasted energy resource. The current situation for greatly increasing natural gas use is favorable. Several oil producing companies are planning projects to bring natural gas to new users. There are many firms in Nigeria who wish to engage in projects to utilize more natural gas in an economic fashion. The crucial company in natural gas utilization projects is the Nigerian Gas Company Limited (NGC), which is making efforts to increase its natural gas markets. NGC is a subsidiary of the Nigerian National Petroleum Corporation (NNPC) and has been instructed to deregulate and increase its natural gas shipments. NGC was established in 1988 from the former Gas Division of NNPC. It was formed to develop an efficient gas industry that would enable the country meet its future domestic energy needs and industrial feedstock requirements. The growth of the natural gas industry comes at the same time that Nigeria has firmly chosen democracy as its form of government. It is expected that the necessary governmental reforms will be made to allow natural gas utilization to greatly expand. NGC is currently operating a modestly-sized network of pipe transmission and auxiliary systems designed to receive natural gas from selected oil and gas fields in Delta and Rivers States and to supply gas to selected industries in the south, south-eastern, and south-western parts of the country. The utilization of natural gas within Nigeria has been stagnant in the last five years, slightly over 300 million scf/d, with most gas users being parastatal and quasi-parastatal companies receiving gas at subsidized rates. Existing gas supply systems include those provided to the power stations operated at Afam, Delta 4, Egbin and Sapele, the steel plants at Ajaokauta and Aladja, the fertilizer plant at Onne, the Warri Refinery and Petrochemicals Company and the aluminum smelting plant (ALSCON) at Ikot Abasi. NGC proposes to increase the internal use of natural gas in Nigeria by at least 50 percent. This proposal can be implemented if the recent drive for reducing the flaring of gas at oil fields continues and there is an expansion of the Nigerian pipeline network for delivering natural gas to new users. NGC is planning to start the first major phase of this expansion before the end of this year. It is concentrating on first supplying gas to new businesses that are running manufacturing plants with substantial fuel use. These plants are currently burning liquid fuels and face the necessity of purchasing, transporting and storing this fuel. It would be cheaper and more straightforward to buy natural gas delivered to their plant site. Both the cement factories at Ewekoro and Shagamu have reported that their recent transfer from fuel oil to natural gas has been very satisfactory. The next major pipeline expansion is expected to go north from Ajaokuta to Abuja and Kaduna, in order to make gas available to three newly planned power plants and other large industrial users of fuel in these areas. The establishment of an east-west link within the existing gas transmission system is also an important element of NGC's plan. The trans-Nigerian gas pipeline system as planned by NGC is expected to be nearly 3,000 km long. The project will probably take about two years to accomplish and will cost $300 to $400 million, of which $200 million is intended to be spent on pipeline expansion by NGC. The remaining investment would have to be made with NGC support by the Nigerian private sector interested in gas processing and distribution. NGC is also supporting efforts to process gas to extract natural gas liquids (NGLs) or produce compressed natural gas (CNG) for use in Nigeria as alternative fuels. NGC wants to develop a new market for natural gas use by small businesses located near large industrial customers or at well-developed industrial estates. The development of residential use of gas, which is now limited to use of bottled cooking gas, is also of interest to the Nigerian Gas Company. As described, the principal objectives of the domestic gas utilization fuel Feasibility Study are to investigate the best most cost-effective uses of NGC's natural gas, including increased power generation and production of NGLs, which would include LPG and CNG. The tasks for the Feasibility Study are summarized as follows: 1) market size analysis, 2) review of required system changes, 3) development of recommended accounting and gas price changes, 4) determination of currently required system changes, 5) environmental assessment, and 6) implementation plan and final report preparation. The U.S. firm selected will be paid in U.S. dollars from a $400,000 grant to the Grantee from the U.S. Trade and Development Agency (TDA). A detailed Request for Proposals (RFP), which includes requirements for the Proposal, the Terms of Reference, and a background definitional mission report are available from TDA, at 1621 N. Kent Street, Suite 200, Arlington, VA 22209-2131. Requests for the RFP should be faxed to the IRC, TDA at 703-875-4009. In the fax, please include your firm's name, contact person, address, and telephone number. Some firms have found that RFP materials sent by U.S. mail do not reach them in time for preparation of an adequate response. Firms that want TDA to use an overnight delivery service should include the name of the delivery service and your firm's account number in the request for the RFP. Firms that want to send a courier to TDA to retrieve the RFP should allow one hour after faxing the request to TDA before scheduling a pick-up. Please note that no telephone requests for the RFP will be honored. Please check your internal fax verification receipt. Because of the large number of RFP requests, TDA cannot respond to requests for fax verification. Requests for RFPs received before 4:00 PM will be mailed the same day. Requests received after 4:00 PM will be mailed the following day. Please check with your courier and/or mailroom before calling TDA. Only U.S. firms and individuals may bid on this TDA financed activity. Interested firms, their subcontractors and employees of all participants must qualify under TDA's nationality requirements as of the due date for submission of qualifications and proposals and, if selected to carry out the TDA-financed activity, must continue to meet such requirements throughout the duration of the TDA-financed activity. All goods and services to be provided by the selected firm shall have their nationality, source and origin in the U.S. or host country. The U.S. firm may use subcontractors from the host country for up to 20 percent of the TDA grant amount. Details of TDA's nationality requirements and mandatory contract clauses are also included in the RFP. Interested U.S. firms should submit their Proposal in English directly to the Grantee by 1:00 P.M., Friday, December 22, 2000 at the above address. Evaluation criteria for the Proposal are included in the RFP. Price will not be a factor in contractor selection, and therefore, cost proposals should NOT be submitted. The Grantee reserves the right to reject any and/or all Proposals. The Grantee also reserves the right to contract with the selected firm for subsequent work related to the project. The Grantee is not bound to pay for any costs associated with the preparation and submission of Proposals.

Record

Loren Data Corp. 20001109/BSOL002.HTM (W-312 SN5061H6)