Nigeria and China have signed a $3.3 billion agreement to develop the Brass Industrial Park and Methanol Complex in Bayelsa State.
The deal was finalized during the Africa-China Conference in Beijing, as announced by the Director of Information and Public Relations at the Federal Ministry of Finance; Mr. Mohammed Manga.
Manga described the project as transformative, with the potential to significantly enhance Nigeria’s industrial output and create numerous employment opportunities.
He further noted that the agreement underscores the two nations’ dedication to strengthening economic cooperation, deepening bilateral ties, and fostering sustainable development.
The signing took place alongside the inaugural China-Nigeria Economic Cooperation and Trade Conference, part of the 2024 Forum on China-Africa Cooperation (FOCAC).
Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, emphasized the importance of South-South cooperation, particularly in advancing Nigeria’s sustainable development goals.
He also highlighted President Bola Tinubu’s commitment to creating a business-friendly environment to attract investments, particularly in key sectors like infrastructure, energy, and industry.
He added that infrastructure development remains a cornerstone of the China-Nigeria partnership, with both nations committed to joint projects such as roads, bridges, and energy systems aimed at accelerating industrialization and promoting long-term economic growth in Nigeria.
What you should know about the deal
In an explainer post, leading business news platform Nairametrics noted that the Brass Oil and Gas City project aims to position Nigeria as a premier hub for downstream oil and gas manufacturing and industrial activities in Africa.
The post revealed that the project will be situated on Brass Island in Bayelsa State, and is envisioned to become one of the world’s largest centers for petrochemical, fertilizer, refinery, and hydrocarbon processing.
The explainer post reads in part: “These developments will contribute to the creation of a world-class, export-oriented oil and gas processing city in Nigeria. To date, $3.5 billion in investments have been committed to projects within the Brass Oil and Gas City.
“Brass Fertilizer & Petrochemical Company Limited (BFPCL) is the sponsor of the Brass Methanol Project, a joint venture between DSV Engineering Limited (DSV) and two Nigerian state-owned enterprises—the Nigerian National Petroleum Corporation (NNPC) and the Nigerian Content Development & Monitoring Board (NCDMB). BFPCL will own and operate the joint venture.
“The project is situated in Brass Island in Bayelsa State, Nigeria, comprising various components, including a gas supply network that connects gas fields, wells, and pipelines, a natural gas processing plant, a methanol production and refining facility, product export terminals, and supporting utilities and infrastructure.
“Both the Gas Processing Plant and the Methanol Plant will be located on a 667.5-hectare site at the eastern end of Brass Island, near the St. Nicholas River and bordered to the south by the Atlantic Ocean.”
China-Nigeria Relations
On record, bilateral trade reached US$3 billion in 2006 – up from $384 million in 1998. Over the years, the two countries have forged a strong partnership, marked by a series of significant joint agreements and collaborations. Here are some key highlights of their bilateral cooperation:
- During Chinese President Hu Jintao’s visit in 2006, China secured four oil drilling licenses and agreed to invest $4 billion in oil and infrastructure development projects in Nigeria, and both nations agreed to a four-point plan to improve bilateral relations – a key component of which was to expand trade and investments in agriculture, telecommunications, energy, and infrastructure development.
- China agreed to buy a controlling stake in the Kaduna oil refinery that would produce 110,000 barrels per day (17,000 m3/d).
- Nigeria also promised to give preference to Chinese oil firms for contracts for oil exploration in the Niger Delta and Chad Basin.
- In 2006, China agreed to grant a loan of $1 billion to Nigeria to help it upgrade and modernize its railway networks.
- In 2005, Nigeria agreed to supply PetroChina with 30,000 barrels per day (4,800 m3/d) of oil for $800 million.
- In 2006, the CNOOC purchased a share for $2.3 billion in an oil exploration block owned by a former defence minister. China also pledged to invest $267 million to build the Lekki free trade zone near Lagos.
- In April 2018, Nigeria signed a $2.4-billion currency swap deal valid for 3 years.
- In 2019, bilateral trade between China and Nigeria reached $19.27 billion.
