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Oil & Gas Industry / NNPC deploys 10m litres of fuel to Northern states
« on: October 30, 2015, 08:31:20 AM »

Nigerian National Petroleum Corporation, NNPC, says it had deployed 306 truckloads of Premium Motor Spirit, also known as fuel, which is about 10 million litres of the product, to some northern states in the country.

The corporation, in a statement by its Group General Manager, Group Public Affairs Division, Mr. Ohi Alegbe, said the deployment was to quell the queues noticeable in some petrol stations in some northern states, following rumours of an impending fuel scarcity.

NNPC stated that within the last 48 hours, petrol products trucked out to most major cities across the country, especially in the Northern part of the country, had been increased considerably to accommodate some noticeable shock in the system as a result of the growing panic demand for petroleum products in the affected cities.

It said: “We can confirm that an additional daily supply of 306 trucks of PMS, which is the equivalent of over 10 million litres of petrol, has been injected to provide extra daily supply to Kano, Minna, Suleja/Abuja, Gusau, Katsina and Kaduna.

“Similar steps have been taken to consolidate the prevailing stable fuel supply situation in the Gombe, Bauchi, Jos, Yola and Maiduguri axis.”

NNPC, however, advised members of the public to refrain from panic purchase of petroleum products, noting that there was enough products in store to satisfy demand.



At least 300 residents of Yotomi Golden Estate, in the Ofada, Mowe area of Ogun State, have been thrown into complete darkness.

The problem, they say, started after they led a delegation to the manager of the Owode service hub of the Ibadan Electricity Distribution Company, Mr. Kole Olanipekun.

They alleged that Olanipekun, who was annoyed with the protesters, sent officers to disconnect their power and put them in total darkness.

The residents, who spoke with PUNCH Metro, asked for an urgent intervention in the matter and the restoration of their electricity.

The women leader of the community, Mrs. Olaide Sobogun, said the problem of poor power supply had been on for more than four years.

She added that the problem escalated in September, 2015 when the unit consumption per household suddenly moved up to 200 units.

She said, “The Ibadan Electricity Distribution Company has put us in perpetual darkness because we protested after they brought crazy bills to us.

“They billed each consumer N4,000 a month ago and we held a peaceful protest at the front of our community that they should reduce the tariff. Their officer said he was only a marketer and he directed us to their Owode office.

“When we got there, their manager said he knew we didn’t consume more than N1,500 worth of power per month, but that he had a target of N11.8m.

“He said he would have to get the money from the consumers, and it was unfortunate we had to bear the burden. He said it was an order from the Sagamu district, and if we could not pay, we should go back to our villages.

“Before we knew what was happening, some officers came to the estate and disconnected our electricity from the source without informing us or giving us any letter to warn us.”

A resident, Mr. Oduberu Oluwakemi, explained to PUNCH Metro that before the protest, the community hardly got electricity supply.

Oluwakemi said the people in the community had been suffering for a long time, adding that most residents relocated from Lagos State to the area due to harsh economic conditions.

He said, “Most of us here left Lagos because of high cost of living. Here, we pay just N2,500 for a two-bedroomed flat a month. So, tell me, how reasonable is it for somebody to be paying N2,500 as rent and N4,000 for electricity? The IBEDC has turned us to a cash cow.

“We get power supply for a maximum of seven days in a month. Neighbouring villages, which pay far less money get more power supply.”

Oluwakemi, who claimed to spend N550 on transport to town every day, lamented that many of the people in the village were low income earners and deserved better treatments.

Adebayo Devis, a bricklayer, told PUNCH Metro that life was becoming more difficult for the residents.

Our correspondent was shown three letters that the residents had written to IBEDC.

The letters, dated September 28, October 9, and 23, 2015, decried the alleged exploitation of the residents and the fraud being perpetrated through a disproportionate estimated billing regime foisted on the community.

The October 23 letter detailed a breakdown of the Yotomi Estate electricity bill.

In January, the residents were billed N1,382 for 47 units per family, which rose to 71 units of N1, 768 in February.

After a protest action, the bill reduced to 15 units in May at N866. But the bill took a sharp increase from June and rose to 200 units in September at N4,240.

A senior citizen, Mrs. Oyedotun Gbenuade, said despite the high fee, they were always deprived of power supply, even while villages around had electricity.

She said, “I use only a deep freezer, a single bulb and a fan and yet, they say I should pay N4, 240 every month!”

Another resident, Pastor Akinrinmade Tunde, said the electricity official had advised them to get prepaid metres.

He, however, added that the people could not afford the N24,000 demanded for the meters, and appealed that the electricity tariffs be reduced pending when the dwellers would be able to get the money.

He said, “We have written to the National Electricity Distribution Commission, the headquarters of the IBEDC, and even copied the state governor and this is 17 days after, and we have yet to get any response.

“Instead, the power company is telling us to prepare ourselves, that our next bill will be N6,000. We are not asking for free electricity, the question we want to ask is, what changed between May, when we were using 15 units and September, when it rose to 200 units?”

In his reaction, the manager of the Owode unit of the IBEDC, Olanipekun, said the residents chased away the officials sent to distribute electricity bills to the community.

He said, “They drove away our officers that were supposed to distribute the bills and this was despite using our electricity. They haven’t paid the September bill. We asked them to get prepaid meters so that nobody would be cheated but they refused. They said we should take our electricity.

“Yet, they continue to use power without paying and there is no way we can continue to allow that. They have written so many letters and copied me and obviously I am awaiting instruction from my superiors.

“If they are ready to sit with us and talk on how they will pay their outstanding bills, then we will restore their power.”


Oil & Gas Industry / LPG to become available in abundance soon – LPGAN
« on: October 30, 2015, 08:22:18 AM »

The president of the Liquefied Petroleum Gas Association of Nigeria (LPGAN), Dapo Adesina has said that Liquefied Petroleum Gas (LPG) otherwise known as cooking gas will soon flood the market, The Nation reports.

Adesina dismissed allegations that the scarcity of the product was caused by technical problems, instead he said market forces were responsible for the shortage and slight increase in the price of LPG by operators.

He said the expected supply of LPG would be coming from the Nigeria Liquefied Natural Gas Limited (NLNG) based in Bonny, Port Harcourt, Rivers State. Adesina noted that the supply is imperative in order to buoy availability and minimise the stress consumers have gone through in recent times to obtain the product.

Energy Mix Report


…says prosecution of looters will deter others

President Muhammadu Buhari yesterday said in New Delhi, India that despite the fall in oil prices, his administration remains fully committed to maintaining macro-economic stability and improving investor confidence in Nigeria.

At an interactive session with Chief Executives of Indian companies with interests in Nigeria, Buhari expressed belief that with its abundance of human and material resources, the Nigerian economy does not have to suffer unduly from low oil prices, despite its severe impact on government revenues.

“What is required of us, to which we are strongly committed, is the implementation of tight expenditure controls, effective fiscal and monetary policies, including the husbandry of scarce resources which our introduction of the Single Treasury Account has began to address.

“We are aware some of these measures may hurt operations of some businesses in the short term, but we believe they are right for a sustainable economy,” the President said.

He noted that India has been a dependable ally and friend of Nigeria and urged the Chief Executives to expand their companies’ investments in the country in order to turn the engagements into a win-win situation for both countries.

“We can increase and diversify the current volume of our bilateral trade beyond US$16.36 billion, and diversify to other critical sectors such as agriculture; green technologies in power generation; infrastructure; information and communications technologies; the services sector; education; industry, especially textiles and solid minerals among others,” the President said.

Bihari also urged the Indian Chief Executive Officers to accept the changes in policy being introduced by his administration and observe all extant Nigerian laws in running their business in the country.

He, however, warmed that his administration would not tolerate the importation of sub-standard goods, especially foods and medicines, into Nigeria.

The President also reaffirmed his administration’s resolute commitment to curbing corruption, plugging all loopholes in public sector accounting and deploying available resources for the good of all Nigerians.

Addressing members of the Nigerian community in India, Buhari declared that the recovery of stolen funds and prosecution of persons who have been indicted for corrupt practices would also continue to be vigorously pursued.

The President said that he expected the ongoing recoveries and prosecutions to serve as a deterrent to others who nurse the ambition of seeking public office solely for illegal personal gain.

Buhari assured the gathering that his administration fully recognized the devastating consequences of the illegal diversion of public resources meant for national development into private bank accounts, and was doing all within its powers to stop such diversions.

“The anti-corruption campaign will be on-going for many years. We are committed to the enthronement of good governance that plugs the loopholes in public sector accounting, and the use of scarce resources for public good.

“We are determined to demonstrate exemplary leadership that will make our citizens to change their ways in a manner that lays a solid foundation for reconstruction and development.

National Mirror

Oil & Gas Industry / Power generation drops to 660mw at Egbin plant
« on: October 29, 2015, 09:14:47 AM »

Power generation has dropped from 813 megawatts to 660 at the Egbin Power Plant in Lagos State, an official said yesterday.

The plant, the nation’s biggest power generating outfit, has the capacity to contribute about 1,000 megawatts to the national grid.

An authoritative source at the plant told the News Agency of Nigeria (NAN) in Lagos that the drop was as a result of the ongoing maintenance of Egbin lines by the Nigerian Gas Company (NGC).

The source said the plant was advised by NGC to step down its generation due to the ongoing repairs at its lines.

“Egbin Power Plant, the nation’s biggest power generating outfit, has the capacity to wheel out 1,000 megawatts to the national grid.

“The ongoing maintenance at the NGC lines had stalled wheeling out of 1,000 megawatts generation to the national grid,’’ the source said.

According to the source, the development may also affect the general power generation output on the stations which receive gas from NGC.

Contacted for comments, Mrs Seun Olagunju, the Director, Public Affairs, Transmission Company of Nigeria (TCN), confirmed to NAN on phone that the national power generation output now stood at 4, 274 megawatts.



International concern is mounting over the mismanagement of Nigeria’s oil industry funds, with the corruption watchdog, Global Witness, urging the help of the United Kingdom to recover funds lost by Africa’s leading oil and gas producer in the famous but controversial Malabu oil deal.

A letter cited by Reuters has asked UK’s Crown Prosecution Service, CPS, to freeze the assets of those involved in the Malabu oil deal through which Nigeria lost more than a billion dollars due to lack of transparency.

Global Witness revealed in its recent report titled, ‘How to Lose $4 billion’ that in Nigeria and two other African countries – Democratic Republic of Congo and Angola – lucrative oil and mining assets worth $4 billion were awarded to companies with hidden owners, thereby diverting vast resource revenues to unknown private pockets.

Under this arrangement, Nigeria lost $1.1 billion in the Malabu oil deal, the loss coming due to lack of beneficial ownership transparency in the oil and gas industry, Global Witness said in its report.

Reports have indicated that more than half of the $1.1 billion (N171.32 billion) paid to Malabu Oil and Gas for the procurement of one of Nigeria’s richest oil fields, OPL 245 by Royal Dutch Shell and Italian firm Eni was used to bribe Nigerian politicians and intermediaries who helped to secure the controversial deal.

According to Italian prosecutors, some of the N83 billion ($533 million) slush money was used to buy private jets and armoured vehicles.

“We are investigating many money transfers to many people in various countries who received sums that vary from millions of dollars to thousands of dollars,” Reuters quoted the letter to the UK’s Crown Prosecution Service as reading.

British prosecutors acting on the request to freeze the assets of those involved in the Malabu oil deal, have already frozen two accounts with combined sum of N29.5 billion ($190 million) belonging to the chief intermediary, Emeka Obi.

Former oil minister, who was convicted for money laundering in France, Dan Etete, owns Malabu Oil and Gas. The company was incorporated five days before the oil block was awarded to it in 1998 during the regime of military dictator, Sani Abacha.

With regard to how anonymous companies made $1.1 billion disappear in a single deal in Nigeria, Global Witness noted that “in 1998, the then Minister of Petroleum Resources, Dan Etete, awarded a company called Malabu Oil and Gas a huge oil block off the West African coast called ‘OPL 245’, without publicly declaring that he was the owner of the company.

“The OPL 245 block was said to have been purchased in 2011 by European oil companies, Shell and Eni, who paid $1.1 billion into an account set up by the Nigerian government”.

The report stated, “The government agreed to transfer the same amount to a Nigerian company called Malabu Oil and Gas, which was secretly owned by a former oil minister, Dan Etete. Malabu eventually passed $800 million of the money to a network of Nigerian companies with anonymous owners, which were apparently vehicles for paying others involved in the deal”.

Shell and Eni had always denied paying money to Malabu, however, Global Witness said court evidence arising from suits brought against Malabu for unpaid fees by the middlemen involved in facilitating the deal showed that they knew that the funds would go to the company.

Global Witness noted that the OPL 245 deal had now been investigated by authorities in three countries, saying the Nigerian House of Representatives in a 2014 vote called on the government to cancel the deal, and the Economic and Financial Crimes Commission “is also investigating, and recently questioned Dan Etete.”

“With a new government now in power publicly committed to rooting out corruption, there is a risk that Shell and Eni may have their exploration rights revoked because of the way the block was acquired,” it said. It also added, “This iconic case demonstrates why EITI must embrace beneficial ownership disclosure as a matter of urgency”. Global Witness said if the EITI required disclosure of beneficial owners, it would pave the way for real transparency in the country.

Source: SweetCrudeReports


The new wave of openness and transparency pervading the operations of the Nigerian National Petroleum Corporation, NNPC, received fresh impetus yesterday with the public harvesting of 278 bids submitted by indigenous and foreign firms seeking to secure contract for the sale and purchase of the 26 Nigerian crude oil grades on offer.

The process, which was covered live by all major television networks in the country had in attendance representatives of the bidding companies with officials of the Bureau of Public Procurement, BPP; Department of Petroleum Resources, DPR; Nigerian Extractive Industry Transparency Initiative, NEITI; Nigerian Content Development and Monitoring Board, NDCMB as well as members of the civil society attending as independent assessors.

Speaking at the flag-off of the event, Group Managing Director of NNPC, Dr. Ibe Kachikwu, stated that the essence of the public bid process was to consolidate on the new promise of setting a new agenda for the corporation anchored on the tenets of transparency and efficiency in line with President Muhammadu Buhari’s agenda for the oil and gas industry.

“The essence is to ensure that nobody needs to call me personally as Ibe Kachikwu for him to get crude allocation. So, you can imagine the burden it takes off my shoulders. It means a good amount of my time will now go into other relevant areas of operation where the country needs me most,” Kachikwu said.

Throwing more light on the process, Mallam Mele Kyari, Group General Manager, Crude Oil Marketing Division of NNPC, said with the new measure put in place, the incidence of brief case companies and hawking of Nigerian crude would become a thing of the past.

“The idea is to select companies that are credible, capable with track record and would not go to hawk our crude. We are going to get as close as possible to the end users of our crude. What this means is that we are going to eliminate all those transactions that are not necessary,” Mallam Kyari stated.

Representative of the DPR, Mrs. Folashade Odunuga, commended NNPC for the transparent manner it conducted the bid process noting that as the regulator of the industry, the DPR was impressed with the new wave of transparency sweeping across the value chain of the corporation.

The contract for the engagement of qualified and reputable companies for the sale and purchase of Nigerian Crude Oil grades is conducted in consonance and in pursuance of the provisions of the Public Procurement Act 2007 and the BPP guidelines.

As part of the pre-qualification requirements, interested companies were expected to demonstrate the possession of minimum annual turnover of $750m and net worth of at least $300m, ability to establish an irrevocable Letter of Credit for the payment of any allocated Crude Oil subject to the contract terms as well as the ability to pay an initial deposit of $2.5m representing the first lifting deposit upon signing of the contract agreement among other requirements.

The 26 grade of Nigerian Crude Oil on offer include: Bonny Light, Forcados Blend, EA Blend, Bonga, Qua Iboe Light, Yoho Blend, Erha and Escravos Light.

Others are; Pennington Light, Agbami, Brass Blend, Abo, Oyo, Okono Blend, Amenam Blend, Akpo Condensate and Usan.

The rest include: Atam Blend, Okwori, Okoro, Ima, Ukpokiti, Obe, Okwuibome, Ebok and Asaratoru.

Oil & Gas Industry / Refineries can’t access crude oil, says Kachikwu
« on: October 28, 2015, 08:54:33 AM »

The refineries are not performing optimally because they are unable to access crude oil for refining, Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Dr Emmanuel Kachikwu, said yesterday.

He said the four refineries are battling with obsolete equipment and are unable to take crude oil for refining into finished products.

Represented by the Executive Director, Pipelines and Products Marketing Company (PPMC), Mrs Aisha Katagwu at the ninth Oil Trading & Logistics (OTL) Expo in Lagos, Kachikwu said the Corporation is working hard to improve pipelines security, restructure its corporate centres, provide transparent and accountable operations, improve efficiency among its workforce. He added that the state-run oil firm was also taking other measures to stop leakages/wastages in the system.

He said the NNPC unbundled PPMC because it wanted to reduce crude oil exports and achieving other objectives that would aid the growth of the industry.

Kachikwu said the Corporation is exploring how it could improve the growth of the Liquefied Petroleum Gas (LPG) market, in view of its importance to the economy.

“We are looking at the LPG market to promote growth. As it is, the country is depending on kerosene for consumption. But we  are seeing the need to grow the LPG sub-sector of the oil and gas industry because it is cleaner, friendlier and cheaper. Besides, the LPG sector would create jobs for the economy.” he added.

Former Minister of State for Petroleum Resources, Odein Ajumogobia, said there have been discrepancies in the number of litres of petrol consumed in the country per day.

He said there was a time the country was said to be consuming 30 million litres of petrol per day, adding that all of a sudden the figure has risen to 43 million litres per day.

Source: The Nation Online

Oil & Gas Industry / 5,000 vehicles in Nigeria run on CNG - NIPCO
« on: September 18, 2015, 08:26:16 AM »
The Nigerian Independent Petroleum Company (NIPCO) Plc, an indigenous downstream petroleum and gas operator, has said over 5,000 vehicles run on compressed natural gas (CNG) in Nigeria.

The company said the CNG- powered vehicles had come to stay in Nigeria, since the inception of the project in 2009.

NIPCO’s Head of Public Affairs, Mr. Taofeek Lawal, said more than 4,000 vehicles had converted to use CNG in Benin, the Edo State capital.

He said over 500 vehicles were also operating in Lagos on the environment friendly CNG. According to him, the aim of the CNG refilling stations in Nigeria, especially in Lagos, was to provide alternative to Premium Motor Spirit (PMS) at a reduced cost and to boost national socio-economic growth.

He also said aside the economic gains, CNG targeted reduction of unfriendly automobile emissions and exposure of Nigerians to the innovation of powering vehicles on gas, adding that the company has about 10 CNG operating stations nationwide, while others are under construction.

He said the patronage of CNG refilling station, at Ibafo, Ogun, has been impressive with an average of five minutes’ drive by commercial buses and private vehicle owners. “CNG sustainability in Nigeria is sustainable considering that Nigeria is one of the largest producers of natural gas.

“Ibafo CNG station, near Lagos, is a world-class facility with about 12 dispensing pumps for light and heavy duty trucks. The innovation is sustainable because the private sector is taking the lead, as government provides enabling environment for it to thrive,” he said.

Lawal said the conversion of vehicles to CNG compatible costs between N200,000 and N300,000. He said the cost profile of CNG vehicular conversion came with a flexible repayment package and depends on the choice of kit.

He also identified poor awareness, absence of policy on natural gas vehicles and lack of natural gas supply across the country as the cause of poor usage of CNG as fuel for vehicles.

Lawal said stagnation of CNG revolution in Nigeria was also due to the inability of NIPCO and the Nigerian Gas Company to float a Joint Venture (JV).

He noted that lack of gas infrastructure, pricing and the government support militate against CNG expansion in Lagos.

“Nigerians are well informed towards the CNG projects but it can be improved upon. The best time for CNG popularisation is when government increases the price of PMS. This will further compel motorists to think of the cost benefits of powering vehicles with natural gas. Gas at N55 per standard cubic feet is equivalent to one litre of petrol, which currently sells at N87 with government subsidy. All the necessary approval from DPR has been obtained before commencement of operation,” he said.

The company’s officials at the Ibafo CNG refilling station said motorists pay initial deposits of about N20,000 for conversion to gas while the balance is deducted through subsequent purchase of gas.

The Nation


Lagos 03/09/2015 - Anglo-Dutch oil giant Shell said it re-opened on Wednesday two key supply pipelines in Nigeria shut last week because of leaks and sabotage that forced it to declare a "force majeure" on crude oil exports.

"The Shell Petroleum Development Company of Nigeria Ltd (SPDC) (September 2) lifted the force majeure on Bonny Light exports following the repair and re-opening of the Trans Niger Pipeline (TNP) and Nembe Creek Trunkline (NCTL.)", the company said in a statement.

The SPDC, a subsidiary of Shell in Nigeria, said it declared the force majeure last Thursday following the shutdown of both the TNP and NCTL.

The two pipelines take crude to the Bonny Light exports terminal, one of Nigeria's main oil terminals.

"Force majeure" is a legal term releasing a company from contractual obligations when faced with circumstances beyond its control.

Shell, a major oil operator in Nigeria, did not disclose the volume of output affected by the incident.

The company has blamed repeated oil thefts and sabotage of key pipelines as the major cause of spills and pollution in the oil-producing region.

Crude oil theft or "bunkering" is a major problem in Nigeria, with estimates that the country loses some $6 billion (4.3 billion euros) in revenue every year because of the practice.

In another development, the managing director of the state-run oil giant NNPC, Ibe Kachikwu, said Wednesday that the nation's armed forces would be involved in policing the nation's oil and fuel pipelines.

"Efforts are in top gear to fix all the crude and petroleum products pipelines across the country," an official Nigerian National Petroleum Corporation (NNPC) statement quoted him as saying.

"The Nigerian Airforce would be engaged to provide aerial survey of the pipelines, the Nigerian Army Engineering corps to fix and police the pipelines and the Nigerian Navy to provide marine surveillance for the network of pipelines," the statement said.

NNPC has more than 5,000 kilometres of pipelines across the country, some located in creeks and forests.

Kachikwu also said that ongoing phased rehabilitation of all the nation's four refineries -- expected to produce 20 million litres of petrol daily at full capacity -- would reduce petroleum products importation.

Nigeria is Africa's largest oil producer, accounting for more than two million barrels per day.

Yahoo News

Oil & Gas Industry / Nigeria set to export 68 crude oil cargoes next month
« on: September 03, 2015, 09:27:05 AM »

Abuja 03/09/2015: Nigeria has concluded plans to export about 68 cargoes of about 2.04 million barrels per day (totalling 63.1 million barrels) of crude oil in October, the highest level this year.

Brent crude, which is the benchmark for Nigeria’s blend prices, went up from the $49.20 per barrel it recorded on Tuesday to $50.31 at noon yesterday.

As at press time, WTI Crude for October delivery was trading 30 cents higher at $ 45.70 per barrel while Brent crude went up by 75 cents at $ 50.31 per barrel.

However, the crude oil export programme may have suffered another setback, following the shutdown of a major export trunk line belonging to the Shell Petroleum Development Company (SPDC).

The oil multinational is yet to lift the force majeure on Bonny Light exports, due to a leak discovered on its major trunk lines in Rivers State.

The provisional loading programmes showed that Shell is expected to export seven crude oil cargoes of 221,000 bpd (a total of about 6.85 million barrels) of Bonny Light in October, but the recent development may have jeopardised that arrangement.

Nigeria, which planned to load about 68 cargoes, could still get some increase as the programme for at least three grades (Okwori, Antan and Pennington) were still pending as at press time.

According to the loading programme, Agbami is expected to load eight cargoes with a total of 7.8 million barrels for the month of October; Amenam, three cargoes (2.85 million barrels); Bonga, seven cargoes (6.65 million barrels); Bonny seven cargoes (6.85 million barrels); Brass River, five cargoes (4.11 million barrels); EA, one cargo (0.95 million barrels).

Also, Ebok is planned to export one cargo (0.65 million barrels); Erha, three cargoes (2.99 million barrels); Escravos, six cargoes (5.7 million barrels); Forcados six cargoes (5.7 million barrels); Okono one cargo (0.9 million barrels); Oyo one cargo (0.65 million barrels); Qua 12 cargoes (11.4 million barrels); Usan three cargoes (three million barrels);Yoho two cargoes (1.9 million barrels) and Okwuibome one cargo with a total of 0.3 million barrels in the month.

While confirming the force majeure, the Corporate Media Relations Manager, SPDC, Precious Okolobo, said: “SPDC Joint Venture has declared force majeure on Bonny Light exports effective August 27, 2015, following the shutdown of both the Trans Niger Pipeline (TNP) and Nembe Creek Trunkline (NCTL). A leak was reported on the TNP at Oloma in Rivers State, while the NCTL is shut down for the removal of crude theft points,”

According to him, the SPDC is working to repair and reopen the two lines as quickly as possible.

The Trans Niger Pipeline, according to Shell, transports around 180,000 barrels per day of crude oil to the Bonny Export Terminal and is part of the gas liquids evacuation infrastructure, critical for continued domestic power generation and liquefied gas exports.

The TNP had earlier closed on May 12 and reopened on May 16 following a leak caused by attempted theft. The NCTL pipeline, with about 140,000 barrels of oil per day capacity, had also suffered series of attack in recent times.

Shell had claimed that crude oil theft, sabotage and illegal refining are the main sources of pollution in the Niger Delta, which caused about 75 per cent of spill incidents from the joint venture pipelines in 2014.

An average of 37,000 barrels of oil equivalent a day (bpd) were stolen from the SPDC network in 2014, with an additional 110,000 bpd of production deferred due to illegal interference with pipelines and other illegal activities such as theft of well head equipment.

Besides, Executive Director, International Energy Agency, Maria van der Hoeven, while speaking on “Cheap Oil’s Make-Or-Break Moment for Clean Energy,” said that the plunge in oil prices may be good for consumers and the global economy, but it could also encourage greater use of fossil fuels and thereby hurt efforts to make the planet’s energy system more sustainable.

According to him, policy makers from around the world can prevent this by taking advantage of cheaper oil to make meaningful changes in the way we price energy.

However said that today’s bear market in oil is merely reflecting the changes in supply and demand that were set loose by the bull market of the last several years.

The Guardian


President Muhammadu Buhari Wednesday in Abuja directed the management of the Nigerian National Petroleum Corporation (NNPC) to work more closely with the indigenous oil producers boost domestic refining capacities.

The president gave the directive while meeting with members of the Independent Petroleum Producers Association in the Presidential Villa.

Led by its spokesperson and Chief Executive Officer of Seplat Oil, Mr. Austin Avuru, the Association which which represents about 20 Nigerian companies operating mainly on onshore fields had intimated President Buhari of its resolve to build private refineries and increase local production to 1.2 million barrels per day by the year 2020.

While commending the determination of the group to increase the participation of Nigerians in the country’s oil industry, the president pledged his administration’s support and assistance to the project.

“We have the manpower for a more effective participation in our oil industry. We will give you all possible encouragement. You certainly won’t be ignored under my leadership,” he said.

The President also assured the oil producers that the present administration will take appropriate actions to maintain and enhance security in their areas of operation, noting that better security will help to lower production costs, which, he said, had become unnecessarily high in the country.

– Vanguard


The new Group Managing Director (GMD) of Nigeria’s state oil company has tapped the private sector as part of an overhaul of senior ranks intended to clean up the entity at the heart of the country’s economy.

According to the Financial Times, Emmanuel Kachikwu was appointed this month by President Muhammadu Buhari, who tasked the former ExxonMobil executive with rooting out corruption and mismanagement at the Nigerian National Petroleum Corporation (NNPC).

Kachikwu said his hiring strategy was intended to “refocus and sharpen” the company. He will also review all Production-Sharing Contracts (PSC) and Joint Venture Agreements (JV) as part of the extensive restructuring.

About a dozen of the appointments made last week included direct hires from Total, Statoil and Royal Dutch Shell. While some of the new recruits have private sector backgrounds, like Kachikwu himself, most are individuals who have spent much of their careers inside the company that he aims to turn round.

Both Kachikwu and President Buhari are grappling with the same dilemma as the latter seeks to govern Nigeria with more transparency and accountability than his predecessors.

Repair of state entities, such as NNPC, must take place without so thoroughly purging them as to remove all institutional experience and upset the fragile political balance that underpins Africa’s most populous country and its vast bureaucracy.

NNPC was at the heart of the alleged industrial-scale theft of Nigeria’s resources that took place with government complicity, and reportedly resulted in many billions of dollars in oil revenues failing to make their way into state coffers. President Buhari, who was elected on an anti-corruption ticket, and his inner circle, have made the institution’s root and branch reform a priority.

Days after taking the helm, Kachikwu dismissed NNPC’s top brass, appointed a leaner executive board and reduced the pool of senior managers (by a third to 88).

Kachikwu wanted to appoint more people with private sector backgrounds but “had to manage the corporate and country politics,” said a source in the Nigerian oil industry, who works for an International Oil Company (IOC).

“Too many outsiders all of a sudden would not have been a good strategy,” he said, adding that the state-owned company “will almost certainly bring in more as time goes on.”

NNPC has said that it aims to create a leaner and more efficient organisation and restructure the company from being a government-focused body towards “a profit-driven business.”

“Over the next five to six months, you will begin to see emerging a new NNPC,” Mr Kachikwu told journalists in the capital, Abuja, last week. Reforms are expected to cover corporate governance to revenue retention, which has become even more important amid lower oil prices.

The administration has to strike a delicate balance when appointing the critical managers who oversee and regulate the activities of Nigeria’s most lucrative industry.

The oil and gas sector provides more than 70 per cent of government revenues.
Head of energy and natural resources at FBN Capital Limited, Rolake Akinkugbe, said the leadership had to be comprised of “those who are more technocratic and those who are more politically savvy, who can negotiate and deal with bureaucratic obstacles.

“It’s possible there could be further changes,” she said, but for now “maintaining people who understand political navigation” is essential.
The challenge of installing the right mix of people has been evident this summer as Nigerians, foreign investors and governments await the announcement of Buhari’s cabinet. He has said this will be in September, more than three months after he took office.

The president has already rejected several recommendations for important government postings on the grounds that they were not of the right calibre and were too familiar with the previous president’s practices, one person familiar with the matter said.

“ Buhari has a difficult political situation to navigate when it comes to the composition of key government bodies,” said Jean Herskovits, a research professor who has written on Nigerian politics for more than 40 years. “He shouldn’t underestimate how difficult this reform is going to be.”

Oil & Gas Industry / Oil dips after brief rally
« on: August 19, 2015, 04:22:53 PM »

Oil prices fell again after a brief rise in the previous session, as the US enters the lower demand autumn season and Asia’s leading economies slow down.

Oil prices edged up Tuesday, briefly ending a rout that dominated the last six weeks and pulled down prices by almost a third, after bullish economic data and the prospect of falling crude stockpiles in the US.

But the price rise did not last into Wednesday, when both US West Texas Intermediate (WTI) crude futures and internationally traded Brent fell in early trading in Asia.

“Any recovery in WTI prices from a six-year low may be short-lived with the US entering the slow demand period in September,” ANZ bank said on Wednesday.

US crude futures were trading at $42.37 per barrel early on Wednesday, down 25 cents from their last settlement. Brent was down 28 cents at $48.53 a barrel.

“The recent drop in the price of oil confirms … the global commitment producers have to their current levels of output,” said Scott Cockerham, managing director Houston-based Conway MacKenzie’s Energy Advisory Services.

“Could we see $30 oil in the next 15 months? Absolutely, and headlines like China’s recent yuan devaluation and the prospect of sanctions on Iran being lifted will only contribute to such volatility,” he added.

Cockerham said a slowdown in US drilling activity would not affect global supplies until 2017 and prices would likely remain low but volatile before then.

Oil & Gas Industry / NNPC Boss to open company books for public scrutiny
« on: August 19, 2015, 04:19:19 PM »

The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Dr. Ibe Kachikwu, has stated his resolve to usher in a new dawn of transparency through the periodic publications of the Corporation’s financial transaction insisting that transparency must be the watchword of every staff in the new NNPC.

Dr. Kachikwu who stated this at his maiden Town Hall meeting with the staff of the Corporation at the NNPC Towers, Abuja, said the new NNPC of his dream is a Corporation anchored on the foundation of transparency.

Charging the staff to break away from the old culture and bring creative solutions to the numerous challenges facing the Corporation, the GMD said with the kind of change he has in mind the staff could not afford to continue with business as usual.

He challenged staff not to obey any directive from him or any superior officer that runs contrary to the rules, adding that President Mohamadu Buhari will not ask him to do anything shady just as he himself would not ask any staff to carry out any unlawful duties.

“I want transparency. Beginning from next month, I want to be able to publish what the company makes. I have told the President that as from next week I will be sending him weekly reports”, he said.

Speaking further on the culture of transparency, he said it should begin with establishing the current financial status of the Corporation and that he would sign on auditors “to do a proper forensic audit to tell us where we are.”

He promised to revisit old processes that used to make for efficient operations, adding that staff should see themselves the drivers of the changes required to bring about the new NNPC.
“You are the best consultants there are. While there may be need to refer certain issues to consultants, ultimately you are the ones who will implement whatever recommendations they come up with; you are the ones who have been around and who understand the system and so you are the ones who should drive the change,” he charged the staff.

He said the change would be anchored on three key issues of people, processes, and profit, adding that the people element was key to the success of the other two elements which was the reason personnel motivation was dear to his heart.

He dismissed reports that he was out to sack 1000 staff and that nothing could be farther from the truth as he needed quality staff to drive the processes and business in the new NNPC.
Speaking on behalf of members of the Petroleum and Natural Gas Senior Staff Association, PENGASSAN Comrade Francis Johnson pledged the readiness of NNPC staff with the GMD to achieve the Federal Government’s reform agenda for the Corporation and the oil and gas industry at large.

Echoing the position of the PENGASSAN President, Comrade Igwe Achese, President of the National Union of Petroleum and Natural Gas Workers, NUPENG, said that as a group, the union has implicit confidence in the ability of the new GMD to deliver on the President Mohammadu Buhari reform agenda in the oil and gas industry.

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