Blue Seal Energy Group (BESG) has begun the construction of its $12.5 million chemical plant in Ibeju Lekki, Lagos.
The company’s Managing Director/Chief Executive Officer, Mr. Doyle Edeni, made this known during the plant’s groundbreaking.
He added that the siting of the company in Nigeria is an intervention by the firm to bridge chemicals import.
Edeni noted that the first phase of the 35,000-metric ton per year chemical plant would cost about $12.5 million, adding that there is provision for expansion.
He said on completion of the plant, there would be improved access to industrial chemicals to boost local production.
“It will create employment for artisans and community stakeholders, reduce dependence on imports, stimulate economic activities, create secondary industry and indirect jobs for suppliers of raw materials and services to the factory and support the current administration campaign for indigenous production of goods and services,” he added.
According to him, the chemical factory will create direct and indirect jobs for 500-1,500 people. He stated that prior to building the plant, the company imports chemicals from its parent firm in Houston, United States, adding that locating the factory in Nigeria is to attract investment into the country.
He said Nigeria imported chemicals worth $1.4 billion last year alone, out of which his company was responsible for $5 million.
Edeni said: “BESG is a 100 per cent indigenous engineering solution company that provides professional and bespoke chemical solutions across the various industries. BESG ventured into the specialty chemical manufacturing space and their applications cut across the oilfield chemicals, downstream chemicals, heavy industries and middle chemicals.
“We manufacture drilling chemicals which include barite, bentonite, caustic, calcium chloride. Others are production chemicals such as emulsion breakers, water clarifiers, scale inhibitors, paraffin inhibitors, corrosion inhibitors, oxygen and H2S scavengers. We also manufacture boiler, cooling water, waste water treatment chemicals and commodity chemicals.”
He criticised the uncertainty of the business environment, adding that it has forced many firms to shut down.
“You know chemical is a product that has a shelf life span; therefore, any player in that industry must plan well. Sometimes, while your product is on its way to the country, some companies or refineries would have shut operations due to power and other challenges. By the time they arrive and stay for some periods longer than necessary in the warehouse, they would have expired and lost quality,” he said.
The need to establish a factory in-country became compelling because of the aforementioned constraints coupled with logistics issues, which prolong the arrival of chemicals into Nigeria up to three or more months, he said, adding that the associated cost required to dispose these chemicals had become a huge burden because such could not be dumped into the environment without detoxification.
“With the production plant located in Nigeria, we don’t have to suffer expired chemical losses anymore. The idea of paying detoxification companies is really impacting on our bottom line,” he said.
According to him, 70 per cent of the cost of building the plant will be sourced from foreign finance institutions and 30 per cent from local lenders.
