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Nigeria Seeks $1bn For Ajaokuta-Kaduna-Kano (AKK) Pipeline Project As China Withdraws
Nigeria seems to be at crossroads over funding of the Ajaokuta-Kaduna-Kano pipeline as the Chinese government seems to be backing out on the funding of the project.
The Nigerian National Petroleum Corporation (NNPC), through the federal government of Nigeria, is seeking US$ 1bn from lending organizations, including export-import institutions, to continue working on the ongoing construction of the Ajaokuta-Kaduna-Kano (AKK) pipeline.
This is after Chinese lenders (the Bank of China and Sinosure, a Chinese export and credit insurance corporation), who had pledged to offer most of the funds (85%) for the implementation of the project, failed to disburse the cash as expected.
Work on the AKK pipeline project started approximately 12 months ago and the NNPC has almost exhausted the envelope corresponding to its commitment to invest the remaining 15% in the project.
The AKK delay is the latest sign of failing financial support for infrastructure projects across the African continent, after years of major Chinese lending for the railway, energy, and other projects. Reportedly, Chinese bank lending to African infrastructure projects has fallen across the continent, from US$ 11bn in 2017 to US$ 3.3bn in 2020.
An Overview Of The AKK Pipeline
The 614km AKK pipeline begins at the Ajaokuta terminal gas station (TGS) in Kogi to a gas station at Kano state.
It will be constructed in four segments, the first of which will run from Ajaokuta to Abuja for a total distance of 200km. The second segment will extend from the Abuja TGS to the Kaduna TGS, a distance of 193km, while the third segment will be 97km from Kaduna to Zaria. The fourth and final section of the pipeline will be 124km from Zaria to the Kano TGS.
The pipeline will comprise 40in-diameter pipe joints and it will operate at a pressure of 1,000 pounds per square inch (PSIG).
The Purpose Of The Pipeline
Upon completion, it will transport up to 3,500 million cubic feet of gas a day from various gas gathering projects in southern Nigeria.
Hydrocarbon liquids will be processed at Ajaokuta to produce liquefied petroleum gas, while the remaining gas will be transported to supply feedstock for new power plants and petrochemical facilities at Abuja, Kaduna, Kano, and Katsina.
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