Jonathan To Build 8 Fertilizer & Petrochemical Plants Worth $20 Billion

http://www.bloomberg.com/news/2011-03-01/nigeria-to-sign-deal-with-investors-for-20-billion-plants-1-.html


Nice one Mr President. 

If this man is allowed to continue in office, this country will definitely change for the better in coming years. 

A welcome development by Goodluck.

Surprised this didn't get more attention.

jonathan to do this , jonathan to do that.
promises upon promises, abeg let this guy move over.
lets think for a minute, how will this fertiliser get to its final destinations?
is it on theses our delapidated road networks.
cat b4 the horse?

$20b?! WTH

There is one thing in promising to build an expensive plant it is another to get it working properly. if you do not take out the rot in the system, this will just end up being another monumental failure. Where else have we seen that? does the Nigerian Power project spring to mind?

Delta steel was built with over $6BN
Ajaokuta Same
and so many other projects, but what has happend to them?

These are all unrealistic ill-thoughtout projects, promised during the passion of elections. Nigerians dont be decieved

the govt has no plan at all, all these ill tot of ideas,will end up enrishing the boys in agbada/ babariga as usual.
we need good road networks criss crossing the whole of nigeria, open the waterways from lokoja to akwa ibom,ph,lagos, etc. proper funding of the railway network.
dualise most roads etc etc.
govt should the running of buss. to proper buss. men/women who are astute enuff to take these risks.
damn my head hurts.

I wonder why those who know more than the president are not running to be the president to do the right thing.

Promises Promises Promises . GEJ is not devoid of ideas but has no clue when it comes to implementation.

Even the devil promised to give Jesus the earth if he Jesus would simply bow.

Where will he get the $20billion, na sand?

Looking at some of these comments, it's not surprising we have a history of failed projects. People literally WILL these projects into failure by their intensely negative thoughts. Just imagine if every individual had the mentality that a certain project will fail. It becomes a self-fulfilling prophecy. People actually kill these projects with their thoughts. Thoughts are very powerful in shaping reality. My advice is for people to be a lot more positive, from those at the helm to the man on the street.

ROSSIKE:

People literally WILL these projects into failure by their intensely negative thoughts.

People don't WILL these projects into failure, the politicians setting up the projects already created them to fail.



Few years back, we sold NAFCON plant at Onne to Notore Chemical Industries.

Notore turned the behemoth around, and now they want to remix NAFCON again.




They should please tell us how many tonnes of fertiliser they plan to produce with these new facilities.

Nigeria only uses 500,000 tonnes of Fertiliser per year.



China built 800,000 tonne plant for $440m

http://energy.worldconstructionindustrynetwork.com/news/china_xlx_fertiliser_to_construct_fourth_urea_plant_in_xinxiang_city_100927/


China and Russia built Fertiliser plant for $120m in 2007 to produce 200,000 tonnes of fertiliser.

http://www.google.co.uk/search?hl=en&source=hp&q=china+spends+on+fertiliser+plant&aq=f&aqi=&aql=&oq=


When I even saw that they would be citing fertiliser plant in Lagos, I had to laugh. Shebi they would first transport all the petroleum products to Lagos, meanwhile Onne is strategically located to produce Fertiliser at the best possible price.




Anyway, lets do some back of envelope calculations:

Nigeria consumes 500,000 MT of Fertiliser, which sells at $500 per Metric tonne.

I dont even need to do detailed breakeven analysis for alarm bells to start ringing. If you assign $100 profit per MT, at Nigerias current consumption capacity (which BTW is already heavily subsidised) of 500k MT, you are talking $50m profit per year.

You choose an apropriate value of profit per metric tonne and do the analysis yourself.


Maybe Goodluck want to be exporting Fertiliser to other countries in competition with Potash cos I dont see how our domestic consumption of fertiliser and methane warrants $20bln. Goodluck with getting the cost price low enough to compete. hehehehehe



More calculations:


Nigeria's budget is $30bln per annum.

60% of this is spent on recurrent expenditure.


Which leaves em $12bln for capital expenditure every year.

Or over GEJ's 4 year term, that would be $48bln.


They would spend $20bln of this on Fertiliser and Methane plant.

Prolly another $20bln on Power

God knows how much else on "airport in every state".

Wetin go remain gon?



If you ask me, this is another classic Nigerian project where the politicians first ask "how much can I make from the deal" before asking "is the deal financially sensible?"

Ibime thank you jare, we know that it is just empty promises, he is just saying it to make people happy, abeg people should be recording the promises of these politicians, in four years we will ask them how far.
We need to restructure this country abeg, how can the FG be getting 56% of everything gan, how many are they there, flew over the Niger Delta last two weeks, the Governors there should be flogged, you could not see a single thing on ground.

Good post Ibime. You are correct, seems way too much spent if the intent is just fertilizer.

The article is quite light on details though. Perhaps there is more planned. I'm trying to give the dude the benefit of the doubt.

@ibime

God bless you  - you will perform better as president  than a combination THIS failures yar adua/IBB/GEJ/SAMBO/obj


being that GEJ  is a ritualist and have been involved in blood money for a while  - The man simply has a  shrine  in aso rock that spits out dollars anytime GEJ Shouts PEE DEE PEE  POWER every morning.

eku_bear:

Good post Ibime. You are correct, seems way too much spent if the intent is just fertilizer.

The article is quite light on details though. Perhaps there is more planned. I'm trying to give the dude the benefit of the doubt.

You are simply wasting your time. A man with a track record of ZERO service delivery and Implementation.

ROSSIKE:

Looking at some of these comments, it's not surprising we have a history of failed projects. People literally WILL these projects into failure by their intensely negative thoughts. Just imagine if every individual had the mentality that a certain project will fail. It becomes a self-fulfilling prophecy. People actually kill these projects with their thoughts. Thoughts are very powerful in shaping reality. My advice is for people to be a lot more positive, from those at the helm to the man on the street.

Some Nigerians are a strange breed indeed! Not only will they beam their negative thoughts, they also go overboard to throw voodoo calculations at us. Look at the shameful thing Ibime did up there; the fact that it is an absolute sham didn't stop a couple of other dullards hailing it as illuminating. For one thing, it is quite clear he didn't read the article before expending so much energy.

I'm not surprised why so many people fail basic math and comprehension.

I have pasted the very first paragraph of the article for emphasis (also, as proof that it wasn't read and that some simply criticise based on some primordial instinct). It is really mystifying how Ibime began talking about the Nigerian budget, whereas the article is quite clearly about Public Private Partnerships. I weep:

Nigeria will sign binding memorandums of understanding with oil companies for the building of petrochemical and fertilizer plants at a cost of $20 billion “in the weeks ahead,” the country’s petroleum minister said.

http://www.bloomberg.com/news/2011-03-01/nigeria-to-sign-deal-with-investors-for-20-billion-plants-1-.html

English comprehension might be the problem here.

English comprehension might be the problem here.

thank you mr. Beafbugger.
i think you r missing that WORD cost out.
the project irrespctive of your MOU will COST $20bill.
that moni is frm where, mr comprehension?

^
Kai! Una many like dis?

Dude, cost to who? Thats the golden question.

Petrochemical plants mean fertilizer plants that will increase our agriculture and food production and methanol plants that will boost industrial production, creating over 300,000 jobs,”

now tell me that the same petrochemical companies that have been in nigeria since day dot are eager to create 300k jobs over night.
for them to even try to achieve that amount of job creation it is obvious that the FED . GOVT. will bear the cost.

ode remo:

now tell me that the same petrochemical companies that have been in nigeria since day dot are eager to create 300k jobs over night.
for them to even try to achieve that amount of job creation it is obvious that the FED . GOVT. will bear the cost.

With due respect sir, you are simply starting a rumour. The FG has signed MOU's with investors who will inject $20billa worth of investments in the Nigerian economy.

As for the oil companies investing to create 300,000 jobs, its a new day! Gone are the days when people just collected brown envelopes, signed Nigeria away and enslaved us without the slightest thought for how the oil would be drilled, or how much oil would be drilled for that matter (Shell would just give Abuja any figure they liked and ship off something totally different).
It is the same govt that is pushing for the Petroleum Industry Bill (PIB) and not renewing any drilling contracts until that bill is in place. In one word, it is a revolution!

Never has Nigeria seen a govt that can means to get our due from the oil companies. By the way, the PIB will multiply Nigeria's income 7 times, from $102billion annually, to $687billion annually. Thats yet another revolution.

"Petrochemical plants mean fertilizer plants that will increase our agriculture and food production and methanol plants that will boost industrial production with a combined initial investment of about $20billion this will result in the creation of over 300,000 jobs across the nation,’’ Mrs. Alison-Madueke stated.


Combined initial investment of $20bln.


MOU's have not been signed, neither has any company been mentioned so as it stands, the cost to Nigeria is $20bln.


Whether Naija will carry 50% of the initial construction cost, then offset the other 50% against concessions. . . or however the deal is structured, this is the cost to build these plants.


Lets see who will bite this deal, and the details, then come back to this convo (on cost to Govt) later.


And how come the fertiliser plant from the $23bln deal we signed with China last year has migrated into this deal?

How many fertiliser plants do we need, and at what production levels?

One plant can swallow all of Nigeria's fertiliser requirements as I have shown with the Chinese plant producing 800k tonnes.

We have Onne, the Chinese one (to be built), and are still looking for more. Yet we havent been able to run even one successfully.


Anytime I see white elephant alerts like this, I know someone is looking for opportunity to chop money.

Posted by: Beaf

It is the same govt that is pushing for the Petroleum Industry Bill (PIB) and not renewing any drilling contracts until that bill is in place. In one word, it is a revolution!

Never has Nigeria seen a govt that can means to get our due from the oil companies. By the way, the PIB will multiply Nigeria's income 7 times, from $102billion annually, to $687billion annually. Thats yet another revolution.

Bros Beaf

Abeg can you explain the bolded for me. I've heard about this bill but I've not really researched it yet. What and what does it do for Nigeria?

@ Bro Ibime,

I see your points too, though you leave out the PPP aspect of it. Your point about the Lagos location is unimpeachable.
Why not Onne or anywhere near the oil production communities?

eku_bear:

A welcome development by Goodluck.

Surprised this didn't get more attention.

Didn't get much attention, because doesn't it sound too familiar? Big projects, big promises, big contracts and then hollow fulfilment.

Why can't Jonathan make this simple and basic promise of which everyone- old/young, litterate/illiterate can understand.
1. From the day I am sweared in as president, their will be free education from primary to University to every child in Nigeria.

2. Every person of 70 years and above will get 5000 naira every month with immediate effect.

3. I will start and complete one specialist hospital, equiped with the best the medical world can provide in each local govt council within 12 months.

4. I will with immediate effect disband the present presidential fleet of jets and travel like democratic leaders in France, Germany, U.K Canada, Japan, Malaysia, South Africa etc

5. No member of my govt will travel abroad again for medical issue after the completion of the specialist hospitals.

It will cost us about 63% of our current budget to build Petrochemical and Fertilizer plants? What happened to letting the private sector handle more of these?

Eziachi:

Didn't get much attention, because doesn't it sound too familiar? Big projects, big promises, big contracts and then hollow fulfilment.

Why can't Jonathan make this simple and basic promise of which everyone- old/young, litterate/illiterate can understand.
1. From the day I am sweared in as president, their will be free education from primary to University to every child in Nigeria.

2. Every person of 70 years and above will get 5000 naira every month with immediate effect.

3. I will start and complete one specialist hospital, equiped with the best the medical world can provide in each local govt council within 12 months.

4. I will with immediate effect disband the present presidential fleet of jets and travel like democratic leaders in France, Germany, U.K Canada, Japan, Malaysia, South Africa etc

5. No member of my govt will travel abroad again for medical issue after the completion of the specialist hospitals.

Honestly GEJ is clueless! promises, promises and promises where will this $20bn come from? You can not change pepper if you like grind it in a mortal or even use oyinbo blender pepper will always be hot. PDP government can never change its going to be the same old story like Arsenal FC come another 4 year's time.

Anyone who vote for the PDP at any level is voting for another for years of poverty, corruption, unemployment, lack of electricity and other basic amenities.

Just reading the first page of comments on this page and the commentaries, one thing is clear:

The character called Beafe is a dull-brained air-headed goof whose tribalistic and blind support for the pinhead Jonaboy will make him sell his entire family and his poor soul, much less an entire country!

Otherwise, there are a lot of very good points made by posters on this idiot spouting off promises over promises of which he has no clue what it means or how to fulfill them.

CyberG:

Just reading the first page of comments on this page and the commentaries, one thing is clear:

The character called Beafe is a dull-brained air-headed goof whose tribalistic and blind support for the pinhead Jonaboy will make him sell his entire family and his poor soul, much less an entire country!

Otherwise, there are a lot of very good points made by posters on this spouting off promises over promises of which he has no clue what it means or how to fulfill them.

Some people post only because they can press a button, not because they can think in any depth.

Beaf:

Some people post only because they can press a button, not because they can think in any depth.

Yes, and that is YOU! No, one was ever in doubt but NOW, you have confirmed it. Luckily, you still have "Job Security" from your odechukwu, mumutunde non-president Jonaboyboy.

CyberG:

Yes, and that is YOU! No, one was ever in doubt but NOW, you have confirmed it. Luckily, you still have "Job Security" from your odechukwu, mumutunde non-president Jonaboyboy.

CyberG:

Yes, and that is YOU! No, one was ever in doubt but NOW, you have confirmed it. Luckily, you still have "Job Security" from your odechukwu, mumutunde non-president Jonaboyboy.

You sound like one of those malnourished agbero's that finds it severely painful to think.

Onlytruth:

Posted by: Beaf
Bros Beaf

Abeg can you explain the bolded for me. I've heard about this bill but I've not really researched it yet. What and what does it do for Nigeria?
. . .

The PIB will absolutely modernise Nigeria's oil industry. As I said earlier, all past govts did was sign where Shell asked them to sign, and that was it; even the figure for barrels per day we drill cannot be verified by govt, we simply accepted any figure the oil companies gave us. A master-slave relationship.
That has changed, but the PIB promises much more, including the tearing up of the Petroleum Act handed down by the military.

The PIB will remedy the fiscal, ownership and operational defects of the current Petroleum Act. There are many aspects to the PIB:
1. Harnessing our gas and boosting it above oil, instead of flaring it.
2. Floating NNPC as an oil company that will compete on the Worldwide stage
3. Creating a petroleum Research and Development company
4. Reallocating dormant oil blocks to indegenious companies
5. Ensuring a high degree of local content, with local companies getting first call (as against zero local content currently)
6. A company floated out NNPC will oversee the upstream sector (drilling, prospecting and production)
7. NNPC will become a profit making, self funding company (though still govt owned)

Basically, the bill will make Nigeria a player in the energy market, as well as add value through local content and processing. It will be truly revolutionary if it succeeds, instead of being kicked around like balls, we would be able to call the shots and expand overseas.

eku_bear:

Good post Ibime. You are correct, seems way too much spent if the intent is just fertilizer.

The article is quite light on details though. Perhaps there is more planned. I'm trying to give the dude the benefit of the doubt.

Eku_bear, this Diezani is the same Minister that wept on seeing the Lagos-Benin expressway. She was Minister for 2 years and by the time she left, the Laos-Benin expressway was still the same!  
Now here she is at a campaign rally talking of an MOU with oil companies to build petrocheicals and fertilizer plants. It all crap and just words. Nothing like that would happen.

Beaf:

With due respect sir, you are simply starting a rumour. The FG has signed MOU's with investors who will inject $20billa worth of investments in the Nigerian economy.

As for the oil companies investing to create 300,000 jobs, its a new day! Gone are the days when people just collected brown envelopes, signed Nigeria away and enslaved us without the slightest thought for how the oil would be drilled, or how much oil would be drilled for that matter (Shell would just give Abuja any figure they liked and ship off something totally different).
It is the same govt that is pushing for the Petroleum Industry Bill (PIB) and not renewing any drilling contracts until that bill is in place. In one word, it is a revolution!

Never has Nigeria seen a govt that can means to get our due from the oil companies. By the way, the PIB will multiply Nigeria's income 7 times, from $102billion annually, to $687billion annually. Thats yet another revolution.

Beaf, first it says, the government will sign, not has signed. So it is still a poposal, so don't spread any rumours or add to what was not said.

When I saw your bolded parts, I broke out into laughter. The entire oil industry in this nation does not currently employ 300,000 people, so how would a petrochemical plant now create such an amount of job? I aint one of those to be fooled by big numbers you know.
And you obviously don't know much about the oil industry either and how crude oil shipments are handled. Come to think of it, you do not know much about the Petroleum Industry Bill either. Nigeria cannot and will not make $687Billion annually from oil.
Let me explain it in simple mathematics:  If we assume that Nigeria currently makes $102B from oil, to make $687B it has to increase by 600% its annual oil production. Now our OPEC quota is 2 Million barrels per day, a 600% increase would translate to what per day? The pertinent questions are: Do we even have that nstalled capacity, what would happen to other OPEC countries, what would happen to price of oil if suddenly there is surplus of supply?

You guys like throwing numbers to deceive, but a critical examination always shows how shallow the thoughts behind these numbers are.

Beaf:

The PIB will absolutely modernise Nigeria's oil industry. As I said earlier, all past govts did was sign where Shell asked them to sign, and that was it; even the figure for barrels per day we drill cannot be verified by govt, we simply accepted any figure the oil companies gave us. A master-slave relationship.
That has changed, but the PIB promises much more, including the tearing up of the Petroleum Act handed down by the military.

The PIB will remedy the fiscal, ownership and operational defects of the current Petroleum Act. There are many aspects to the PIB:
1. Harnessing our gas and boosting it above oil, instead of flaring it.
2. Floating NNPC as an oil company that will compete on the Worldwide stage
3. Creating a petroleum Research and Development company
4. Reallocating dormant oil blocks to indegenious companies
5. Ensuring a high degree of local content, with local companies getting first call (as against zero local content currently)
6. A company floated out NNPC will oversee the upstream sector (drilling, prospecting and production)
7. NNPC will become a profit making, self funding company (though still govt owned)

Basically, the bill will make Nigeria a player in the energy market, as well as add value through local content and processing. It will be truly revolutionary if it succeeds, instead of being kicked around like balls, we would be able to call the shots and expand overseas.

Beaf, you are joking right? Or are you smoking some igbo? Please, please and please, go and read the PIB! Abeg you, go and read the PIB. Once again, go and READ the PIB.