It is very important that a potential gas customer contacts SNG at an early stage of project definition. This is to enable the alignment of the project schedules of both sides and give Shell Nigeria Gas Limited enough time to study and decide whether to invest in the customers’ project. This will also enable SNG to start supplying gas to the customer on the very day his plant is ready to commence gas utilisation and begin production.
A new customer will usually go through the steps highlighted below before beginning to enjoy gas supply:
- Initial contact, usually an exploratory meeting between SNG and customer
- Information exchange between parties
- Carrying out of conceptual facility design and cost estimates.
- SNG carries out preliminary economic analysis of the project.
- Signing of a Letter of Intent
- A review of the detailed project design and schedule
- Carrying out a detailed project economic evaluation *
- Negotiation and signing of a Gas Sales and Purchase Agreement (GSPA)
- Construction begins
- Plant/factory commissioning, gas starts to flow.
A very crucial stage in this process is the detailed project economic evaluation stage. Here, both SNG and the customer must demonstrate to each other that the project is economically viable and offers economic benefit(s) to both parties.
