The Nigeria Liquefied Natural Gas (NLNG) Limited was incorporated as a limited liability company on May 17, 1989 to harness Nigeria’s vast natural gas resources and produce Liquefied Natural Gas (LNG) and Natural Gas Liquids (NGLs) for export. The establishment of NLNG is backed by the NLNG Act. In this interview with OLATUNDE DODONDAWA, the General Manager, External Relations, Dr. Kudos Eresia-Eke, explained why a company established mainly to curb gas flaring decided to commit billions of naira to Corporate Social Responsibility (CSR). EXCERPTS.
What could prompt a corporate entity to commit N60billion to road infrastructure despite paying its taxes?
Thank you very much for the question. In terms of the economy, we are really struggling like every other company in the oil and gas sector, but there must be a compelling reason for us to devote N60 billion which is the biggest CSR initiatives in the world. Certainly, your question is in order. In developed countries, CSR is capital; you don’t need this kind of CSR in developed countries because government does them. So when I look at Africa and the developing world, I can’t think of any company that has doled out N60 billion or its equivalent to support government to deliver a road for the good of the populace.
There are several reasons we are doing this. First,we believe that Bonny is in the conscience of Nigeria. Bonny has played a key role in the development of our country for decades. More recently, with respect to petroleum, the gateway to export crude oil is located in Bonny. Shell has facility in Bonny, ExxonMobil, Nigeria LNG also in Bonny and most of the proceeds from these operations go to the coffers of the federal government by way of taxes, dividends and depending on the joint venture that is in operation, the lion share goes to the federal government.
This community has been cut off from time immemorial from the mainland so they travel mainly by seas with all the hazards. We share our voyage with the community people to reduce hazards and hardship they face.
The second reason is that the government has been tantalizing the entire Niger Delta with this project because everyone knows that it is a great project but it has been sitting there for over 25 years. We all know what good the project can bring in terms of employment, mobility of labour and capital. It is right in the heart of the Niger Delta but because of funding and other reason, it has not been executed so we thought we should help the government to make that dream come to reality. Another reason is that we have this grand vision that Bonny can be a mini Dubai. We believe it can be set up to show how Niger Delta community can be which is the reason we developed a Foundation, Bonny Kingdom Development Foundation (BKDF), and committed to fund the Foundation to the tune of about N3billion annually for 25 years. There is a master plan we have worked and developed which is on standby. What we are waiting for is the registration of BKDF and development will commence immediately.
Now, think about this great island with all the development, with tourism, growth in business and already, Bonny is a magnet for business. Lots of businesses have relocated to Bonny, in spite of difficulty in transportation. This is because from the onset, we envisioned a kingdom that will be the envy of all other kingdoms. So we signed an MoU with His Majesty and the people of Bonny towards the end of 1998 to deliver roads, potable water and electricity. As I speak today, all have been delivered and we have 24/7 power supply. This is an example that with commitment, it can be done in Nigeria by Nigerians.
What level of commitment did you get from the FG to ensure prompt delivery of this project without delay?
I trust the government and we had enough from the body language of Mr President and people in government that they are committed to the project. Indeed, they demonstrated that commitment during this year budgeting process where some N9billion or so was budgeted. You can see that the zeal is there, you may foretell the fortunes tomorrow. But at least we have comfort that they also understand the importance of the project and they are ready to do what they can to work with us to deliver the project.
What do you think is the most important challenge for local contractors that you engaged to promote Nigerian content?
Each time we talk to local vendors and contractors, one of the things they mention as a big challenge is that they don’t have enough capital. That is there is funding challenge. So what the Nigeria LNG did was to devote about N1billion as guarantee to encourage banks to give loans at reduced rates to local business people. That way, funding is not an issue any longer because you can go to the bank and secure a loan to fund your project and jobs.
Does the Nigeria LNG influence the bank rates on the loan?
We only try to ensure that the rates are much lower than what ordinarily the bank would have given. We have our money and we have a bargaining power not for our own good but for the good of the local contractors. We called it Vendors Finance Scheme. This has been running for some years now but you know we don’t make noise about all these things. Another thing you may wish to know is how much we have supported relatively big business in Nigeria to grow to international level. We always use the opportunity of major contracts to international manufacturers. When there is such contract, we insist on deals that favour Nigeria businesses. We had a deal to build six new ships with HHI and Samsung of about $1.6billion. We then insisted that as part of local content drive, they should make sure that all the paints, arnolds, cables and carpentry works required to build the ships will have to be supplied by Nigeria companies. Having had them commit to that, we then came to Nigeria and look out for companies that can meet up or almost meet up to those standard and then help them to attain that standard that can be accepted for exports. All that have been done and we helped them to raise foreign exchange from such projects.
We do these things not for our own aggrandizements, but because of that faith and commitment in doing all that we can for the good of Nigeria and we will continue to do our business in a professional world class manner in Nigeria.
Looking at the activities of NLNG, one would know you are committed to CSR. So, aside this project, what other CSR projects are you involved in?
NLNG was set up to reduce gas flaring in Nigeria. And we have been able to reduce that from over 60 to 70 per cent to less than 20 per cent. Hopefully, with Train7, we will take more gas and reduce gas flaring to zero. NLNG is the only solution to gas flaring in Nigeria. The second reason is to harness huge gas reserves and monetize it. By way of dividends and taxes, we have contributed a lot to the development of Nigeria and we have met the purpose why we were set up.
Besides, a corporate entity must also be for the good of the society. We don’t think we should do just what we were set up to do but to do more good to the society. That’s the reason we are so bold with NLNG CSR. Our mission statement reads: To be a global company helping to build a better Nigeria. We are Nigerians to the core. Our presence seems to loom so large for the betterment of Nigeria.
However, NLNG also sponsor Nigeria Prize for Literature, Nigeria Prize for Science and beyond the science, we have gone to Nigerian universities to create hubs around the zones of the country and pick a university for each zone. We have Bonny Vocation Centre,which equips people with vocational skills and certified by the London City and Guilds. There is also a Marine Centre of Excellence also in Bonny. This is supporting Nigeria to grow maritime industry so that we begin to take dominance in maritime sector. All the simulators you can imagine are available. There is a plethora of scholarships ranging from the lowest to the highest. We also have a scholarship for the IDPs. We are supporting these children. NLNG have youth empowerment scheme. We take youths from our host communities and train them for 6-9 months and acquire skills that will make them useful in the society. We do this because we believe in Nigeria. NLNG is number four in the world and we are Nigerians 100 per cent senior management team. Our 23 ships go all over the world. A ship is as big as four standard football fields. If you visit the plants, 95 per cent of the people you see are Nigerians. We want to inspire Nigerians that we can do it so that others that are richer than us can join hands so that together we can move our country to where NLNG think it should be.
It is a thing to have a huge budget, but different thing to deliver on projects or implement them. Nigeria by definition is not corrupt, so we are to demonstrate it. We don’t offer bribe no matter how difficult it is. So NLNG do the best we can to hoist the flag of our country as high as we can. NLNG is doing all these because we believe in Nigeria. If Nigerians don’t do this, then who will?
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