What is the significance of the Yoho field in this FLNG project?

The Yoho field, situated in OML 104, serves as the primary feedstock source for the project. Securing a dedicated gas supply from this field via the GSA ensures the FLNG vessel will have a stable and continuous flow of associated gas, which is critical for maintaining steady LNG production and satisfying long-term export contracts.

Why is this project referred to as Nigeria's first indigenous-led FLNG?

Unlike traditional major energy projects in Nigeria that are conceived and operated by international oil companies (IOCs), this project is spearheaded by UTM Offshore, a local Nigerian company. While it utilizes international engineering firms for technical execution, the ownership, development rights, and strategic direction remain under domestic leadership.

How does this development align with Nigeria's national energy strategy?

The project directly supports Nigeria's 'Decade of Gas' initiative, which aims to transition the nation toward a gas-powered economy. By capturing associated gas that might otherwise be flared, the FLNG project reduces carbon emissions, generates domestic LPG to replace dirtier biomass fuels, and boosts national revenues through high-value LNG exports.

Offshore Technology · July 8, 2026 (1d ago) · 1 min read

UTM seals gas sales pact with Seplat and NNPC for Yoho FLNG project

Analysis

AI-assisted analysis · reviewed by Yuri Kan

The signing of a Gas Sales Agreement (GSA) between UTM Offshore, Seplat Energy, and the Nigerian National Petroleum Company (NNPC) represents a pivotal commercial milestone for Nigeria's pioneering deepwater FLNG initiative. By securing a reliable feedstock supply from the Yoho field, the partners have effectively de-risked the upstream portion of the project, clearing a major hurdle toward securing final investment decision (FID). This transaction underscores a broader West African trend of utilizing floating liquefaction technology to monetize stranded offshore gas assets for both domestic power generation and international export.

Key Facts

UTM Offshore has formalized a Gas Sales Agreement (GSA) with Seplat Energy and the state-owned NNPC for the Yoho field floating liquefied natural gas (FLNG) project.
The Yoho field, located in shallow water Oil Mining Lease (OML) 104, is currently operated by ExxonMobil's local subsidiary in joint venture with NNPC, with Seplat participating as a key midstream partner.
The planned UTM FLNG facility is designed to have an LNG production capacity of approximately 1.5 million tonnes per annum (MTPA), primarily targeting export markets.
In addition to LNG, the floating facility is engineered to produce liquefied petroleum gas (LPG) to help meet Nigeria's domestic clean cooking fuel demands.
This project represents Nigeria's first indigenous-led FLNG development, aiming to reduce gas flaring in the Niger Delta while optimizing offshore resource monetization.
The engineering design of the FLNG vessel is being supported by international partners, including Japan's JGC Corporation and France's TechnipEnergies.

Background & Context

Nigeria holds the largest natural gas reserves in Africa, estimated at over 200 trillion cubic feet, yet much of it remains unexploited or flared due to a lack of domestic pipeline infrastructure and investment. Historically, the country has relied on onshore and shallow-water piped gas feeding the multi-train Nigeria LNG (NLNG) complex on Bonny Island. However, persistent pipeline vandalism and upstream security challenges have pushed operators to look offshore, where floating LNG technology offers a secure, flexible, and faster route to market for stranded offshore gas fields like Yoho.

Market Impact

This agreement significantly bolsters investor confidence in Nigeria's offshore gas sector by demonstrating that complex, multi-party commercial frameworks can be successfully negotiated under the country's Petroleum Industry Act (PIA). For Seplat Energy, the deal solidifies its transition from a conventional oil producer to a major midstream gas player, aligning with its decarbonization goals. On a global scale, the successful deployment of the UTM FLNG will add much-needed flexible supply to the Atlantic LNG basin, offering European buyers another alternative to Russian pipeline gas while providing Nigeria with vital foreign exchange earnings.

What to Watch

Following the execution of this GSA, the consortium will focus on finalizing the Engineering, Procurement, Construction, Installation, and Commissioning (EPCIC) contracts. The market will closely watch for the formal announcement of the Final Investment Decision (FID), which is expected to trigger a multi-year construction phase with first gas targeted for the late 2020s. Success here could pave the way for similar FLNG deployments across other stranded shallow and deepwater blocks in the Gulf of Guinea.

Frequently Asked Questions

What is the significance of the Yoho field in this FLNG project?: The Yoho field, situated in OML 104, serves as the primary feedstock source for the project. Securing a dedicated gas supply from this field via the GSA ensures the FLNG vessel will have a stable and continuous flow of associated gas, which is critical for maintaining steady LNG production and satisfying long-term export contracts.
Why is this project referred to as Nigeria's first indigenous-led FLNG?: Unlike traditional major energy projects in Nigeria that are conceived and operated by international oil companies (IOCs), this project is spearheaded by UTM Offshore, a local Nigerian company. While it utilizes international engineering firms for technical execution, the ownership, development rights, and strategic direction remain under domestic leadership.
How does this development align with Nigeria's national energy strategy?: The project directly supports Nigeria's 'Decade of Gas' initiative, which aims to transition the nation toward a gas-powered economy. By capturing associated gas that might otherwise be flared, the FLNG project reduces carbon emissions, generates domestic LPG to replace dirtier biomass fuels, and boosts national revenues through high-value LNG exports.

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