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76
As part of efforts to ensure that only goods with acceptable quality are exported from Nigeria, the Central Bank of Nigeria (CBN) has appointed two additional Pre-shipment Inspection Agents (PIAs) for non-oil exports.

Director, Trade and Exchange Department, Olakanmi Gbadamosi, in a circular to dealers and operators in the non-oil sector, stated that the notice was given in furtherance of a circular issued by the CBN on November 8, 2004.

The banking sector regulator disclosed that in addition to Messrs Cobalt International Services Limited, Carmine Assayer Limited and Neroli Technologies Limited had been included as PIAs for non-oil exports.

The circular indicated that while Cobalt would cover Northern zone of the country, Carmine Assayer would be in charge of South West and Neroli takes care of South East and South-South zones.

In October 2004, there was the reintroduction of pre-shipment inspection of exports which was suspended in March 1999.

The re-introduction of the scheme was part of the Federal Government economic reform programme aimed at diversifying the export base of the country and a measure to ensure that only goods with acceptable quality were exported from Nigeria.

In January 2007, the Government enlarged the scope of the exports pre-shipment inspection scheme to include crude oil and gas. Since the scheme came into operation on October 2004, the company charged with the responsibility for exports Pre-shipment inspection has opened a number of offices across the country.

Under the Nigerian Export Supervision Scheme (NESS), all exports from Nigeria are subject to inspection by the Inspection Agents prior to their shipment; with the exception of certain items. The exempted items are personal effects, used motor vehicles, day old poultry, human parts for transplant purpose, human remains, vaccines, yeast, and periodicals / magazines.

Others are non-commercial exports, such as gifts, trade samples/printed business matter, machinery and equipment for repairs abroad and return to Nigeria, machinery and equipment for replacement, return of machinery and equipment after execution of a specific contract, re-exports and trans-shipments.

In order to avoid multiple examinations and minimise delays during inspections, all the relevant agencies (e.g. Nigeria Customs Service, National Agency for Food and Drugs Administration and Control, Standards Organisation of Nigeria, Nigerian Drug Law Enforcement Agency, Department of Petroleum Resources, Weights and Measures Department of Federal Ministry of Commerce, etc) are encouraged to simultaneously work with the Inspection Agent in order to ensure that the quantity, quality and prices of Nigerian exports conform to the International standard.

http://dailyindependentnig.com/2015/07/cbn-appoints-inspectors-ensure-export-quality-products/?

77
The Executive Secretary, Nigerian Content Development and Monitoring Board (NCDMB), Mr. Denzil Kentebe, has said the successful implementation of Nigerian Content is good to all stakeholders in the oil and gas industry, including the international oil companies (IOCs).

He spoke when the General Managers of Nigerian Content departments of IOCs paid him a courtesy visit at his office in Yenagoa, Bayelsa State capital.

He said the Nigerian Content Act was well implemented, adding that the Board and the operators see themselves as parttners in progress. The Board decided from its inception in 2010 to collaborate with the IOCs, other operators and stakeholders in the service industry, he said, adding that the model had proven very effective in stimulating compliance with the provisions of the Act.

According to NCDMB’s Media Relations Supervisor, Public Affairs Division, Obinna Ezeobi, the Content Board chief said the developmental role of the Board was critical and it involved collaboration with stakeholders to develop in-country’s capabilities, which make it possible to execute most industry projects hitherto taken abroad before the advent of the Act.

He praised the operating companies’ partnership with the Board over the years, and their support to the development of local capacity through various initiatives.

Kentebe charged the companies not to rest on their oars, considering that he is new on the job and needs their contributions.

He assured the General Managers that the Board would work with them to find solutions to the problems their various companies might have with the Nigerian Content.

The General Manager, Nigerian Content, Nigerian Agip Oil Company (NAOC), Mrs. Callista Azogu underscored the IOCs’ commitment to the Nigerian Content development, which she said began before the enactment of the Act in April 2010.

Azogu, also chairperson of the group, admitted that the operators had challenges complying with some provisions of the Nigerian Content Act, noting that such problems were resolved with the Board to the benefit of all stakeholders.

The General Manager, Nigerian Content Department, Chevron Nigeria Limited, Mr. Raymond Wilcox, said their group and the Board had the same objectives, which include drive to increase the participation of Nigerians and utilisation of indigenous assets and facilities in the oil and gas industry, retain a greater part of the industry spend in-country and transform the economy.

He said the Nigerian Content had taken root in the operating companies and members of their group were the vanguards of that philosophy in their organisations.

http://thenationonlineng.net/nigerian-content-good-for-iocs-others-says-ncdmb/?

78
Twelve people died and three were injured in an explosion during repair work at an Eni SpA crude oil pipeline in Nigeria.

The victims worked on a maintenance team for a local service company, Rome-based Eni said in a statement Friday. The Tebidaba-Clough Creek pipeline in the Niger delta was previously “damaged by acts of sabotage.” The company said it is still investigating the cause of Thursday’s blast.

Accidents are common in Nigeria, where pipelines are often breached in attempts to pilfer crude. The incidents interrupt oil and gas flows, affecting Nigeria’s energy exports and revenue for companies including Eni, Royal Dutch Shell Plc and Chevron Corp. Thursday’s incident was the worst since January 2012, when an explosion at Chevron’s Funiwa gas field killed two workers, according to a spokesman for a local environmental group.

“The dead were unidentifiable,” said Alagoa Morris of Environmental Rights Action, the Nigerian affiliate of Friends of the Earth. “Two people that were seriously wounded were rushed to Port Harcourt last night for medical attention. They were badly burnt but they were still alive.”

Eni had 13 incidents related to pipelines and oil wells in Nigeria in May including theft, pipelines being cut using a hacksaw and equipment failure, according to the company’s website. Seventeen were reported in April and 14 in March.

Hundreds have been killed in Nigerian pipeline accidents in the past decade. An explosion at a vandalized oil pipeline in Lagos, Nigeria’s largest city, started a fire that killed at least 200 people and burned many more in December 2006. In May that year, about 200 people were killed when another oil pipeline exploded near Lagos.

Nigeria, Africa’s biggest oil producer, loses an estimated 300,000 barrels a day to criminal gangs that tap crude from pipelines that criss-cross the southern, oil-rich delta for local refining or sale to tankers waiting offshore, according to state-owned Nigerian National Petroleum Corp.

http://www.bloomberg.com/news/articles/2015-07-10/eni-oil-pipeline-explosion-in-nigeria-kills-12-injures-3?

79
The Nigerian Government may be considering the establishment within the next 30 days of an inter-ministerial energy committee that would undertake the regulatory functions of the Department of Petroleum Resources (DPR) and the Nigerian Electricity Regulatory Commission (NERC) in the gas/electricity value chain, to ensure uninterrupted supply of natural gas from the oil companies to the power plants in the country.

Under the National Gas Master Plan, the DPR is mandated to implement a Gas Pricing Regulation framework of 2007, which provides the legal basis for gas supply to domestic market, particularly the power sector, to provide the energy required to power productive activities in the economy.

On the other hand, NERC has the responsibilities under the Electric Power Sector Reform Act to undertake the technical and economic regulation of the tariff, approval of capacity expansion and business plans in the electricity industry value chain.

To guarantee the energy necessary to drive productive activities in the economy, the Finance and Economy sub-committee of the Ahmed Joda-led Transition Committee set up by the ruling All Progressives Congress to assist the smooth take off of the President Muhammadu Buhari administration, recommended that the creation of the committee that would merge and streamline decision making processes between the two agencies and increase regulatory certainty and investor confidence in the power sector.

Equally, the committee advised the Federal Government to consider the establishment of a uniform electricity pricing template for operators in the power sector, including the NERC, Transmission Company of Nigeria, Nigerian Bulk Electricity Trading Plc., Nigerian National Petroleum Corporation, and its Nigerian Gas Company subsidiary as well as the Niger Delta Power Holding Company.

The recommendations, contained in the over 800-page document submitted to the President shortly on assumption of office, a copy of which was exclusively obtained by PREMIUM TIMES, also proposed the adoption of a new technological solution for streamlining and auditing all energy industry transactions at the NNPC.

The committee expressed the conviction that if the proposal was accepted by the government, it would help manage risks in the above oil industry agencies and optimize operational and financial decisions in real time as well as report progress on activities, prepare balance sheet and project backlog on investment plans.

The new solution, the committee noted, would not only guide operators in monitoring key performance indicators by these agencies, it would also boost efforts to block leakages in the system, by providing real-time ability to capture and audit all oil and gas transactions, production, imports, tax obligations and payments to the Federal Government.

The committee said the new system, which the Presidency and the Ministry of Petroleum Resources must facilitate its introduction within the next 90 days, would facilitate the reduction of the industry exposure to sharp and unpredictable price changes by applying risk management strategies through hedges.

To provide a mechanism for real-time overview of the entire energy sector and allow for effective planning and project management, the Joda committee urged the Ministry of Power to work with the Ministry of Petroleum Resources to develop template within 90 days to guide the operation of the system.

To increase the volume of natural gas available to the power sector by at least 1,000MW within the next 18 months and free up government funds, the Joda sub-committee proposed the construction of more gas processing projects already funded by the NNPC/NPDC.

The Presidency and the Ministry of Petroleum Resources, the committee said, should consider the need to facilitate the concession of non-funded government- owned and operated gas fields/projects to competent third party operators to significantly enhance reserves output and revenues, while creating major linkages with other key sectors of the country's economy.

Apart from restructuring the agreements in the gas industry, the committee also recommended that the Ministry of Petroleum Resources should within 90 days enter into fresh arrangements, including private public partnerships, to expand the country's gas grid, gas processing and gas pipelines.

The new arrangement, the committee noted, would help create more jobs, while raising revenue and allowing the private sector to drive development of the gas midstream and downstream sectors, which the government can ill-afford on its own.

The committee noted Nigeria's estimated loss of about 1.9 million barrels of crude oil, or about $66.46 billion (about N10.23 trillion) through crude oil theft and sabotage between 2010 and April 2015, and emphasized the need for the new government to upscale relevant security hardware and personnel to eliminate vandalism to critical pipeline infrastructure and unauthorized offshore vessel loading by unpatriotic elements.

The report advised the National Security Adviser to work with the authorities in the ministries of Defence, Interior & Petroleum Resources as well as the Nigerian Police Force and Nigerian Customs Service to ensure adequate security to the oil facilities with the next 90 days.

http://allafrica.com/stories/201507060053.html?viewall=1

80

The Shell Petroleum Development Company of Nigeria Limited (SPDC) has kicked off the second phase of its grassroots campaign against crude oil theft and illegal oil refining activities in Ogoni land, Rivers State. The first phase of the campaign in 2014 reached over 7,000 community people from Eleme, Gokana, Khana, and Tai Local Government Areas.

“The 2015 campaign is targeted at Ogoni youths for whom we have designed some alternative empowerment programmes such as the ‘Ogoni LIVEwire’ which in January trained 105 Ogoni youths in different skills and offered them start-up funds and support,” the Managing Director of SPDC and Country Chair, Shell Companies in Nigeria, Mr. Osagie Okunbor, said.

“We are therefore focusing on raising awareness among the youths on the environmental, socio-economic and health risks associated with crude oil theft and sabotage of pipelines,” Okunbor said, adding that the initiative was in collaboration with the state government and the National Oil Spill Detection and Response Agency (NOSDRA).

Speaking at the launch in Biara community, the Director, Inspectorate and Enforcement in the state Ministry of Environment, Charles George, commended the people for their efforts towards reducing pipeline vandalism. He reiterated that meaningful development can only take place in Ogoni land if crude oil theft activities end, and assured the people that government was working with relevant stakeholders to implement the recommendations of the United Nations Environment Programme (UNEP) report.

“Crude oil theft and artisanal refining are criminal acts that are not only against the law but capable of mortgaging the future of the community,” said. Melvin Ododo, a Principal Environmental Scientist who represented the Zonal Director of NOSDRA, of the state at the event.

An Ogoni monarch, King Barnabas B. Paago Bagia, said the campaign had the blessings of the council of elders in the area. King Paago Bagia, who was represented by Chief Pegior Raphael, added that the elders were doing all they could to educate the youths against crude oil theft activities that were causing the communities untold hardship.

SPDC’s Ogoni Restoration Project Manager, Augustine Igbuku, said the campaign is a key pillar of the implementation of the UNEP report which recommended, among others, that Ogoni communities take actions that will stop further environmental pollution resulting from crude oil theft and illegal oil refining. He said: “The response to the first phase last year has been very encouraging. We hope that the people will seize the opportunity to join the crusade against crude oil theft and artisanal refining in Ogoni land.”

The campaign against crude oil theft in Ogoni land will run for six months and will be delivered in 12 open-air sessions by Ogoni professionals and government agencies to reach a wide range of community stakeholders.

The messages are aimed at motivating the communities to take a more active stand against individuals who break into pipelines to steal crude oil. Creating more awareness would also foster an enabling environment in which the government and other stakeholders can effectively play their roles in the environmental restoration and socio-economic development of Ogoni land.

http://www.thisdaylive.com/articles/shell-kicks-off-grassroots-campaign-against-crude-oil-theft-in-ogoniland/214036/?

81
Few months after Nigeria’s economy was rebased to emerge the largest in Africa, newly-elected President Muhammadu Buhari has revealed that the national treasury is virtually empty; with ripple effects on monthly federation allocations to the three tiers of government. As crude oil revenue dwindles and unemployment and backlog of unpaid salaries mount nationwide, what innovative methods can be applied generate needed revenue into the coffers of the federal, state and local governments? What comparative advantages can be employed to refill the treasury and put national development back on track in Nigeria?

* Current expenditure must be restructured, and the executive, legislature and possibly the judiciary have to adjust. Our governors who are used to flamboyant lifestyles must adjust, people should also pay their taxes. In all, if we block the loopholes of oil theft, concentrate less on government, reduce political hangers on, get our refineries working, with improved electricity system, we can take care of our needs.
- Mr. Okechukwu Ikonne, Ogbor, Aboh Mbaise LGA, Imo State

* Nigeria needs to diversify its economy, block all the means for corruption and particularly go back to serious agro-business by encouraging and making farming attractive. Wealthy Nigerians should also be compelled to invest in their country before even looking abroad and political position should also be made unattractive.
- Mr. Sunday Okobi, Lagos

* All recoverable funds should be spent judiciously and evenly spread with probity and accountability. President Buhari and his present administration should identify key projects that can cut across all spheres of Nigeria, and make corrupt politics less desirable. Once this is done, all other things will fall in place (unemployment, insecurity, robbery, kidnapping, etc will reduce drastically).
- Mr. Adeniran Arimoro, Education Officer, ConsBras, Victoria Island, Lagos

* Mechanised and commercial agriculture should be encouraged among our farmers and the looted funds by the past administrations (leaders) should be traced and recovered by the present administration so as to boost the treasury and national development.
- Mr. Kriskenny Ojogbede, Abuja

* The new government must be proactive on ways to recover stolen loots. Nigeria should drastically cut all administrative expenses as an objective response to fall in oil prices. Oil subsidy must be totally removed despite the untold hardship and the attendant economic pain in the short-run period. The national treasury was not emptied overnight; hence it will take some time and lots of discipline to get back on track.
- Mr. Dandy Izunwa Ama, Great Citizens Schools, Okokomaiko, Lagos

* If indeed the treasury is empty, how is Buhari getting money?
- Mrs. Pat Odigie, Canada

* When the refineries start working at full capacity, there is a whole new industry waiting to be exploited that has the capacity to generate employment opportunities and provide revenue for the federation. This can be achieved through the by-products and derivatives that the refining process produces. Over 6,000 items are made from petroleum byproducts, including fertiliser, linoleum, perfume, plastics, insecticide, petroleum jelly, soap, roofing, antiseptics, dyes, greases, motor oils, shoes, rubber, tires, rope, water pipes and vitamin capsules to mention a few.
- Mr. Buga Dunj, Jos, Plateau State

* Nigerian government should rally round her friendly countries to see how to repatriate stolen monies secretly kept abroad by few cabals, while millions of people are dying in abject insecurity, poverty, healthcare, unemployment, electricity e.t.c. Countries such as USA, UK, Germany, France, Switzerland, Denmark e.t.c. will be of great assistance at this difficult period.
- Mr. Dogo Stephen, Kaduna

* Over-dependence on federal allocation is fast becoming a deadly threat to our economy and national peace. Leaders who will not manage public funds frugally must be shown the exit door at all cost. Small scale farming and irrigation should be massively embarked upon across Nigeria without any further delay. An empty treasury suggests lawless financial recklessness. Offenders must be punished appropriately by applying the relevant laws strictly.
- Ms. Saiki Ometere Tina, Gboko, Benue State

* Nigeria’s empty treasury can simply be refilled by engaging on other sources of revenue generation such as agriculture and tourism other than over-dependence on oil sector. God bless Nigeria.
- Mr. Patrick Chukwudi Ogbuokiri, Port Harcourt, Rivers State

* Tax-based economy is our best option at this juncture. Revenue generation through taxation is very reliable especially at local government area level. The N2.5 billion daily from crude oil alone, monies from other sectors e.t.c. are boosters. The tax department needs complete overhaul and regular re-orientation. It is apt time to tap the agric and solid minerals sector too. God bless Nigeria.
- Mr. Apeji Onesi, Lagos

* Very simple. It is when we all see Nigeria as greater than our individuality, sectionalism, tribalism, religion e.t.c, which are the weapons that can’t allow our empty treasury to be refilled. I pray that all of us as citizens would see Nigeria as the Americans, Britons and other developed countries adore and talk good of their beloved countries.
- Hon. Babale Maiungwa, U/Romi, Kaduna

* We must urgently review our finances and financial policies, to sanitise our waning economy. The empty treasury during a global economic downturn like now means a total blockage of all the leakages and recklessness of our leaders. All seeming assets which are really liabilities must be sold off now. All the stolen public funds must be retrieved and liable leaders punished accordingly. The finance sector needs reforms urgently.
- Miss Apeji Patience Eneyeme, Badagry, Lagos State

* To earn foreign exchange, Nigeria should immediately begin to sell increased quantities of its liquified natural gases (LNG), some of which Nigeria foolishly flares at present. The demand in the world for natural gas is more expansive than petroleum crude oil. Nigeria should desist from using natural gas to generate electricity. At best, the gas-to-electricity plant should be at a minimum. Instead of natural gas, Nigeria should resort to wind to generate electricity and sell its natural gas. Nigeria will never run out wind, but will with natural gas.
- Prof. Oluchukwu Ekechukwu, Nuclear Production Engineer (rtd), South Carolina, USA

* To refill the treasury the federal revenue should be adequately secured from any diversion or stealing; anti corruption agencies should vigorously embark on recovering stolen money from past government officials; all companies should be forced to pay their taxes accordingly; reduce the number of ministers etc; review states allocation; control importation of goods into the country; invest largely on agriculture and mines; solicit for foreign support; and religiously follow due process and fiscal responsibility in all expenditure.
- Mr. Nura Attajiri CEO, Greenlight Youth Support Centre, Sokoto

* The most pressing evil bedeviling our country is unemployment. If you fight corruption, remember it is institutional, what about those that are outside the system? Fight insecurity through whatever means. Poverty is the worst because no country can efficiently eliminate or reduce poverty to its barest minimum holistically.
- Mr. Okadi Simeon Ngu, Lagos

* Nigerians should not stampede Buhari to appoint ministers and aides in a hurry, to avoid making the same mistakes others made. The three tiers of government should look inward to generate funds to pay salaries, since oil price is not stable. Governors coming to Abuja for allocation would not be acceptable because there are resources in their states to tap for development to pay workers' salaries.
- Mr. Gordon Chika Nnorom, Public Commentator, Umukabia, Abia State

* All these issues should be treated in their alphabetical order. Coincidentally, nature has made it so because when treated as such, 'A' will take care of 'B' which will in turn answer for 'C' and so on; i.e. an antidote for corruption will help in curing insecurity etc.
- Mr. A.M. Tampul, Abuja

82

As the prolonged crude oil prices continue to haunt the nation and other exporters, UDEME AKPAN reports the recent reduction of prices of the nation’s July deliveries would likely attract new buyers, thus generating more foreign exchange into the country.

It was indeed cheering when the Organisation of Petroleum Exporting Countries, OPEC predicted that prices of crude oil would start to leap in the second quarter of 2015. The Secretary General of OPEC, Dr. Abdalla Salem El-Badri that raise the hope at the 19th Middle East Oil & Gas Conference a few weeks ago indicated that global oil market which was over-supplied by about two million barrels per day, bpd would return to balance during the second half of the year.

The Secretary General put the global economic growth at 3.4 per cent, compared to 3.2 per cent in 2014. He remarked that, over the years, the global oil and gas industry had gone through a number of cycles and changes that had required the industry to adapt and evolve.

“There is no doubt that the last nine months have been one of those intermittent periods of volatility, after several years of stability. While prices will no doubt rebound, as they have done lately, it is clear that the industry is currently witnessing a landscape that is shifting the global oil industry,” he maintained.

“These are the current realities. It is a challenging time for the industry. However, there are clearly many things that the industry can do with one eye on the current situation, and one eye on the future. And for producers, it may be useful to use the situation of lower oil prices to create incentives to use energy more efficiently and implement sustainable policies that could lay the groundwork for more diversified and less energy-dependent economies,” he said.

El-Badri said the reason the industry’s stakeholders needed to keep their eyes on the longer term was because energy demand was expected to increase by 60 per cent by 2040, with fossils fuels remaining central to the energy mix. Referring to data contained in OPEC’s World Oil Outlook 2014, El-Badri said that oil-related investment requirements were estimated to be around $10 trillion between now and 2040.

Incidentally, the improved market scenario El-Badri painted has not been experienced, barely a few days to the end of the period. A survey showed that the prices of many crude oil prices, including Nigeria’s Bonny Light, Qua Iboe have hovered at between $59 and $65 per barrel throughout the period, thereby causing stakeholders, especially Nigeria, the leading African producer sleepless nights.

The situation has caused some stakeholders, including the Nigerian National Petroleum Corporation, NNPC to adopt additional measures. The Corporation is said to have reduced the prices of Nigeria’s crude oil grades — Bonny Light and Qua Iboe — to their lowest points in over a decade. The decline, according to reports, was due to declining demand for the country’s crude oil in the international market. Specifically, the Corporation has resolved to sell its July, 2015 deliveries of Bonny Light, the nation’s premium oil grade at 23 cents more than Dated Brent.

Market sources have it that this constitutes the smallest differential since 2005 and compares with a 50 cent premium in June and $2.55 a year earlier. The NNPC also lowered the official selling price for Nigeria’s largest crude oil stream, Qua Iboe, to dated Brent plus 35 cents per barrel, the lowest differential since May 2005.

The drop follows North Sea crude, which hit a 10-year low earlier this week as all Atlantic Basin sellers, particularly those with light, sweet oil, struggle to place cargoes. Rising output from US shale formations had over the last couple of months contributed to a market glut that drove crude down almost 50 per cent last year, roiling global markets as producer nations lost revenue and foreign-exchange reserves.

Officials of NNPC did not respond to telephone calls or text messages over the weekend. But a source in the organisation that was not permitted to speak said the reduction in crude prices would impact positively on the nation as additional demand would be attracted to buy Bonny Light and other crude oil grades. He said this would culminate in increased foreign exchange generation.

However, the development has attracted the comments of some observers. For instance, the National President of Oil and Gas Service Providers Association of Nigeria, Mr. Colman Obasi maintained that the action would attract more patronage to the nation’s crude oil which has not been getting much demand in recent times. He said that the nation would likely sell more cargoes as well as generate more foreign exchange because of the decision.

“I think it make sense to cut prices for the future deliveries, especially as the nation stands to attract more buyers to its oil grades. It is obvious that if our turnover is higher than what we currently have, we will be in a position to generate more funds. Indeed, we need to generate more, particularly because of our over-dependence on petroleum.”

“The nation and other members of OPEC should explore legitimate ways and means of boosting its revenue at least during this period of global recession. But I am optimistic that oil prices would leap in future because of expected economic growth in some oil importing countries,” he added.

Coincidentally, his view is in consonance with that of the cartel which has reported that the world will need more energy in the decades ahead, as the global population expands and economies grow, and as countries seek to provide the energy poor with access to modern energy services, the global need for energy will grow.

“In OPEC’s most recent World Oil Outlook, energy demand is set to increase by around 50per cent between 2015 and 2040. I think that most of us here today also understand that the world has enough energy resources to meet these expected future energy needs. The key questions about our energy future relate to deliverability and sustainability. In this regard, it is important to take on board all of the economic, social and environmental perspectives that feed into it. Firstly, to supply enough energy to meet demand and help provide access to modern energy services for all. And secondly, this needs to be done in a sustainable way, balancing the needs of people in relation to their social welfare, the economy and the environment. It is clear that all forms of energy will be needed. But it is crucial that we appreciate just what each energy source can provide in the future.”

“Renewables – from wind, solar, small hydro and geothermal – certainly hold promise, but globally their share of the energy mix will still be just 4 per cent by 2040, given their low initial base. The share of biomass, nuclear and large hydro is expected to remain at steady levels throughout the period 2015-to-2040, at around 9 per cent, 6 per cent and 2.5 per cent, respectively. This means that fossil fuels will continue to play a dominant role in meeting energy demand, although their overall share will fall from around 82 to 78 per cent during this period. By the 2030s, the share of oil, coal and gas are anticipated to be at similar levels, at around 25 to 27 per cent. Others will obviously have different views on how they see the future global energy mix. This is natural. But I think it is important to emphasize four key words: practical, realistic, logical and equitable,” it added.

The organisation indicated there is a great need to focus on the development of other energy resources. It maintained that over the past two centuries or more, much economic growth has been fuelled by the exploitation of fossil fuels. The cartel disclosed that this has certainly brought real benefits. The organisation maintained that it has helped improve living standards by providing such things as light, power and mobility.

“It has enabled the development of industries and the creation of jobs. And it has helped increase life expectancies. In short, the industrialized world has been built with fossil fuels. We should not forget that this has not been the story for everyone. When we start up our cars, switch on a light, turn on our mobile phones, we need to recognize that these everyday things are still unknown to billions of people across the world who continue to suffer from energy poverty. Today, around 2.7 billion people or more still rely on biomass for their basic needs, and 1.3 billion have no access to electricity.”

The organisation also tasked member states to work toward the diversification of their economies while sustaining huge investments in oil and gas. This seems is imperative as oil and gas are depleting resources that would be depleted in future. The world is waiting to witness to see what the President Muhammadu Buhari-led administration would deplore to boost the petroleum industry in particular and the nation’s economy in general.

http://nationalmirroronline.net/new/nigeria-cuts-oil-prices-as-market-defi-es-analysts-projections/?

83

In a renewed move to blackmail the federal government into reversing the withdrawal of the operatorship of some of the oil blocks sold by Shell and other International Oil Companies (IOCs) from the Nigerian Petroleum Development Company (NPDC) to the new buyers, the workers of the company have threatened to shut down crude oil production.

THISDAY gathered that the workers who resolved to embark on an indefinite strike on Monday, on Tuesday said the strike would now last for three days to give the present administration the final warning to reverse the decision taken by the administration of President Goodluck Jonathan on the operatorship of the acreages.

Insiders within the workers’ unions, however told THISDAY that the workers were really seeking a pay rise and were also using the operatorship tussle as a bargaining tool.

Based on a recent recommendation of the Department of Petroleum Resources (DPR), Jonathan’s administration withdrew the operatorship of some of the divested oil blocks from NPDC, a subsidiary of the Nigerian National Petroleum Corporation (NNPC) to the new buyers, citing the need to offer training and understudy opportunities for NPDC to further develop its capacity in all areas of petroleum operation and compliance.

In protest, the workers of all the NNPC’s subsidiaries and their colleagues in the NPDC last month embarked on a strike during which they shut down oil production to protest the transfer of the operatorship of Oil Mining Leases (OMLs) 40 and 42 to the new buyers.

The action of the workers under the aegis of Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and the National Union of Petroleum and Natural Gas Workers (NUPENG), which crippled economic activities for one week as it later caused acute scarcity of petrol was later suspended by the workers.

NPDC’s Manager (External Relations), Mr. Ugochukwu Atugbokoh, could not be reached on his mobile phone as at press time.

THISDAY however gathered that the unions met on Monday morning and resolved to embark on an indefinite strike, which was yesterday reviewed to a three-day action to give the new administration final warning to reverse the operatorship of assets, failing which the workers will shut down crude oil production and cripple the supply of petroleum products across the country.

NPDC was relieved of the operatorship of the blocks as it is said to lack the financial and technical capacity to operate the assets and has allegedly been using other contractors, particularly Operations and Maintenance (O &M) contractors to run the oil blocks.

Though the NPDC is the operator of the assets, the company allegedly hires other contractors to run the assets due to lack of financial, technical and competent human capital resources to operate the acreages.

For instance, sources close to some of the divested assets informed THISDAY that the O &M personnel at some of the flow stations were actually sub-contractors employed by Century Energy Services Limited, Lee Engineering and Construction Limited and other companies.

The new buyers have argued that this arrangement is more expensive for the NPDC and the federal government than using the new buyers of the assets to operate the blocks.

The unsatisfactory performance of NPDC in the operatorship of the assets is also said to have resulted in low production and poor returns on investment, as the company has failed to deliver on production revenue, despite years of promises.

According to sources familiar with the operation of the assets, of the five divested assets - OMLs 26,30,34,40 and 42, the gross production in 2015 to date averaged only 40,841 barrels of oil equivalent per day (bopd).

The 2014 average was said to be about 47,862 bopd, out of which 18,378 bopd was allocated to the private companies that were in partnership with NPDC, while the investors who staked about $2.85 billion to buy the assets continued to suffer financial losses due to poor operatorship.

NPDC’s alleged financial recklessness was also said to have contributed to the poor revenue from the divested assets as Longitudinally Submerged Arc Welding (LSAW) pipe, Seamless Steel Pipe and SMLS pipes of various diameters and thickness, for instance, which are sold in China for $500 per tonne are allegedly delivered to NPDC in Nigeria for over $4,000 per tonne.

http://www.thisdaylive.com/articles/again-npdc-workers-threaten-to-shut-down-crude-oil-production/212979/?

84
Agriculture / Point of Lay Pullets needed
« on: June 24, 2015, 08:44:33 AM »
Dear All,

Is there anyone in the house that can supply me Point of Lay Pullets?
We need these pullets as soon as possible.

Thanks

85
Oil & Gas Industry / NPDC workers go on strike
« on: June 23, 2015, 04:42:08 PM »


At least 115,000 barrels of crude oil per day, estimated at $6.9 million, may have been shut-in as Nigerian Petroleum Development Company (NPDC) workers, an arm of the Nigerian National Petroleum Corporation (NNPC), begin an indefinite strike.

The action is aimed at stalling the  planned transfer of operatorship of oil blocks divested by Shell Petroleum Development Company Limited to private sector investors that bought the assets.

The strike is coming barely a month the same workers called off their over week strike because the operatorship of one of the Shell divested assets located in oil mining lease (OML) 42, was transferred to the private sector joint venture partner of NPDC – Neconde Energy Limited. The workers are striking to halt further transfer of operatorship of about five more divested blocks by the Federal Government. It was also learnt that the workers are actually asking for salary increase in disguise.

The Nation gathered that the workers under the aegis of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and National Union of Petroleum and Natural Gas Workers (NUPENG) NPDC chapter simply referred to as NUPENGASSAN, had a meeting yesterday and decided to start the indefinite strike immediately after the meeting.

A source told The Nation that after their meeting yesterday, the striking workers locked the offices of the management and those of the private sector entrepreneurs that bought Shell’s divested oil blocks, asked all the consultants and visitors in the company to vacate the premises.

The source said: “NUPENGASSAN union met this morning and decided to go on an indefinite strike starting from today (yesterday). The unions asked all consultant, contract staff and visitors to vacate the company’s premises leaving only the staff in their offices. The staff will remain in their offices but they will not be working. The locked offices of all the management staff including those of their Joint Venture partners. This category of staff could not gain entrance into their offices.”

The source lamented the frequent strike noting that it disrupts production, works against output optimisation and results in revenue decline. This is economic sabotage and destabilisation of the new administration. It is just unfair because the new government needs money. What the Unions are really seeking is a pay rise but they are using the operatorship issue as blackmail to cover their inefficiencies in delivering production and revenue, the source added.

The private sector investors that bought Shell assets and are in Joint Venture with NPDC have decried the attitude of the striking workers because production is shut-in and they are losing money. Besides, the JV partners said because NPDC operates the oil blocks, the assets are hugely under-produced resulting in substantial loss or revenue.

The indigenous private sector JV partners of NPDC are Neconde Energy Limited oil mining lease (OML 42), Elcrest Exploration and Production Nigeria Limited (OML 40), Shoreline Natural Resources Limited (OML 30), ND Western Limited (OML 34) and First Hydrocarbon Nigeria FHN/Afren (OML 26).

http://thenationonlineng.net/new/npdc-workers-go-on-strike/

86
Nigeria Security and Civil Defence Corps (NSCDC) has announced plans to deploy about 500 drones and aircraft to keep surveillance of oil installations in the country.

NSCDC Commandant-General, Dr Ade Abolurin, who disclosed this on Monday in Abuja during a meeting with senior officers of the Corps to strengthen its operational strategy, said some drones have already been deployed in Bayelsa in Nigeria’s Niger Delta in a test-run to ascertain its efficacy.

The NSCDC boss, who decried the spate of pipeline vandalism and oil theft in the country, said the corps was exploring new ways to monitor and protect the pipelines, especially the use of technology to track down the perpetrators.

He said, “I can assure you that we are already exploring new approaches which will include the massive deployment of technology as opposed to the outdated conventional approach you are used to.”

Abolurin said about 250 vandals had been directly arrested, while another 100 were arrested by other security agencies and handed over to them for prosecution, with 35 successfully convicted this year alone.

He said the corps had also stepped up its protection of other critical infrastructure in the country such as power installation, telecommunication masts and equipment so as to ensure better service delivery to Nigerians.

http://dailyindependentnig.com/2015/06/nigerian-security-agency-monitor-oil-pipelines-drones-aircraft/

87
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Regards
Nigeria Oil & Gas Forum

88

Following allegations of massive fraud, the two chambers of the National Assembly have been advised to commence investigation into the activities of the Nigerian National Petroleum Corporation (NNPC), particularly in the areas of crude oil swap programme and offshore processing agreements (OPAs).

Making the call yesterday in a letter addressed to the Senate President and the Speaker of the House of Representatives, Lagos lawyer and human rights activist, Mr. Festus Keyamo, alleged the looting of the country resources by some NNPC officials in collaboration with some local companies.

The crude oil swaps  is an arrangement whereby about 50 per cent of the nation’s daily quota of crude oil meant for domestic refining and consumption are given to some local companies in the oil and gas sector which then sell the products in the international market and thereafter import petroleum products, including derivatives or byproducts on behalf of the NNPC and PPMC for sale and distribution in the country.

It was a programme put in place due to the inability of local refineries to operate at their fully installed capacities which would have been able to refine all the daily domestic quota of crude oil.
Similarly, the offshore processing agreements (OPAs) is the allocation of the daily domestic quota of crude oil to some local companies so that the companies then take the crude oil to refineries outside the country, refine them into petroleum products, including derivatives or byproducts, and import them into the country on behalf of the PPMC.

But according to Keyamo, there have been “colossal fraud in both programmes”  in recent years.
He alleged that: “The fraud occurs when far less quantity of petroleum products, byproducts and derivatives are imported into the country by the local companies in exchange for the crude oil allocated to them by the NNPC,” he alleged.

He added that: “The staggering shortfalls in the imported products are done with the active connivance, collusion and knowledge of the officials of the NNPC. The proceeds are, of course, subsequently shared between the NNPC officials and these local companies.

“In fact, it is reported that a colossal sum of about $50billion  have been stolen by these people through these fraudulent programmes in the last few years.”

The lawyer named some NNPC officials, who he said are already under investigation by  the Economic and Financial Crimes Commission  (EFCC) and the Directorate of State Security (DSS) as some of the brains behind the scam.

“I humbly request that you direct your searchlight on  the  Managing Director, NPDC, Mr. Tony Moneke;  Executive Director, Commercial, PPMC, Mr. Frank Amejo; Group General Manager, Crude Oil Marketing Division, Mr. Gbenga Komolafe and former Managing Director, NPDC, and later NNPC Group Executive Director, E & P, Mr. Abiye Membere.

“I also urge you to invite the following private, local companies in the oil and gas sector in the course of your probe to assist in getting to the bottom of the whole sordid affair: AITEO that is owned by Mr. Benny Peters; Sahara Energy owned by Tonye Cole; Tope Sonubi and Ade Odunsi;

Ontario Oil and Gas owned by Walter Wagbatsoma and Taleveras founded by Mr. Igho Sanomi,” he said.

He also called for probe into the roles that the immediate past Minister of Petroleum Resources, Mrs. Deziani Alison-Madueke may have played in the allegation of massive fraud.

“Though I understand she also wrote a petition in this regard few days before leaving office, but it is not always the case that it is the person that runs first to the police station to report an incident that is the victim.

“I find it extremely curious that she waited till a few days to the end of her tenure before writing that petition. I also find it curious that she wrote a petition in respect of matters over which she had total control and in respect of which she had complete access to all the documents and personnel involved. In fact, the above-mentioned personnel were her subordinates whom she could have queried long ago if she smelt any rat.

Keyamo reminded the lawmakers of their investigative responsibility and powers preserved under section 88(2)(b) of the 1999 Constitution of the Federal Republic of Nigeria (as amended), which is to ‘expose corruption, inefficiency or waste in the execution or administration of laws within its legislative competence and in the disbursement or administration of funds appropriated by it’.
“The danger in not exposing these acts of corruption through open and public hearings is that even the investigators may be tempted to engage in cover-ups and under-hand dealings because of the colossal sums involved in these shady deals,” he noted.

http://www.thisdaylive.com/articles/keyamo-asks-n-assembly-to-probe-alison-madueke-nnpc-others-over-oil-swaps/212390/?

89
Oil & Gas Industry / Rehabilitation of oil refineries
« on: June 18, 2015, 08:23:46 AM »
That the Port Harcourt Refinery may commence production at the end of this month, if reports credited to the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Dr. Joseph Dawha, some days ago are anything to go buy, came as a refreshing breather, especially when the immediate past civilian administration of President Goodluck Jonathan and others before it indulged in double-speak on the need for government to run refineries. On different occasions, the Presidency, Federal Ministry of Finance and Ministry of Petroleum Resources under Jonathan harped on the non-viability of refineries, on the one hand and on the other, gave approval for the building of new ones or maintaining the old ones. In 2002, the government of former President Olusegun Obasanjo issued licences to 18 investors to build new refineries. But 13 years on and still counting after, the country still relies almost wholly on imported petroleum products, with no visible capacity to refine enough of the products locally to meet even domestic needs.

The Federal Government in June 2012 also signed a Memorandum of Understanding (MoU) with some private American investors in respect of a $4.5 billion (N698 billion) deal to build six modular refineries in collaboration with the NNPC. The Minister of Trade and Investment, Dr. Olusegun Aganga, had stated that two of the new refineries would be ready by May 2013, and would be contributing 10 million litres of fuel daily. When fully operational, it was projected that the six refineries would have the capacity to refine 180,000 barrels of crude per day. But it ended there. Former NNPC Group Managing Director, Mr. Andrew Yakubu, once said all the MoUs signed with foreign firms since 2010 to establish refineries in the country could not work because “no investor will come and invest in a regulated environment”. Meanwhile, FG’s iron cast hold on and control of the pricing of petroleum products, which discourage competition and the abandonment at the National Assembly for over eight years of the Petroleum Industry Bill (PIB) meant to open up the oil sector, are among the main factors scaring away potential private investors in oil refining.

Dawha, NNPC’s new helmsman says, however that “We are carrying out phased implementation of rehabilitation of the refineries … the Port Harcourt Refinery, which has reached an advanced stage will start receiving crude by the end of this month… At the end of 18 months, most of the refineries would have been rehabilitated”. The country has four refineries, two in Port Harcourt, and one each in Kaduna and Warri, all with installed capacity of 445,000 barrels per day. But they have scarcely exceeded 35 percent production capacity.

Official figures say Nigeria’s average daily consumption of Premium Motor Spirit (petrol) is 40 million litres; Automotive Gas Oil (diesel) 12 million litres; Dual Purpose Kerosene (DPK) 11 million litres; and Liquefied Petroleum Gas (LPG) 1.2 million litres. But the country refines only 5.10 million litres of PMS; three million litres of AGO; 2.10 million litres of DPK; and 0.34 million litres of LPG daily and imports the difference of 34.90 million litres of PMS; nine million litres of AGO; 8.90 million litres of DPK; and 0.86 million litres of LPG per day; about 90 per cent of Nigeria’s daily petroleum products’ need on a rough average; and NNPC is calling the shots.

Former Petroleum Minister, Mrs. Diezani Allison-Madueke, said the FG would have spent N152 billion on refineries repairs by 2013; and that the total installed capacity of all the country’s refineries would be increased to 90 percent by 2014 – another failed promise. Billions of dollars also went down the drain, especially between 1990 to date, in the name of turnaround maintenance (TAM) of the four refineries, all with spittle as the result, contrary to what obtains in other well managed crude oil producing nations that earn handsome foreign exchange through refined petroleum products and enable their citizens enjoy that gift of nature.

If the Petroleum Resources Ministry and NNPC have now seen good reasons to revive the nation’s refineries, it is a huge relief, though belated. But it must be matched with sincere deregulation and opening up of the oil and gas upstream and downstream sectors to competition and transparency; as against their use before now as nests for corruption and dubious political patronage. The facts that diesel costs a fortune long after its pump price was deregulated; and kerosene is hardly sold at subsidised rate, have since exposed the rump of the oil sector. The rot is no longer a shrouded mystery.

http://nationalmirroronline.net/new/rehabilitation-of-oil-refineries/?

90
The Central Bank of Nigeria, CBN, yesterday paid gas suppliers the sum of N 6. 9 billion as part of its Nigerian Electricity Market Stabilisation Fund set aside to ensure a steady power supply to the Nigerian public.

The Governor of CBN, Mr. Godwin Emefiele, who handed cheques to seven companies in Abuja, said that the facility was a part payment for debts owed the gas suppliers by electricity Distribution Companies, Discos, across the country.

CBN had set aside N213 billion to help stabilize the electricity power sector by providing funds to operators in the sector to enable them make necessary investments as well as, clear debts that have been considered as inhibiting power supply to homes and businesses.

Mr. Emefiele disclosed that Discos were owing gas suppliers as much as, N40 billion as at the end of December 2014.

Companies that got paid were: Chevron, N2.04 billion; Ibom Power, N1.7 billion; Shell, N965 million; ND Western N852 million; Seplat, N739 million; NPDC, N407 million; and Pan Ocean, N 230 million. Eko Disco also received N4.4 million.

According to the CBN boss, “ these payments represent debts by the power sector in proportion to the obligations to repay the facility by the five DisCos: Eko, Ibadan, Kano, Port-Harcourt and Enugu, that have so far signed up to the facility.

“As more DisCos become confident that the issues with their tariff regimes will be resolved and sign up to the facility, we expect to make further disbursements to gas suppliers and other power sector participants.

“For us at the CBN this is very significant as we have started to clear your legacy debts. We will ensure that the outstanding debts are cleared once we are able to get the other DisCos that are supposed to be in the chain to fall in line so that we can all work together for the progress of this country, by ensuring that we have electricity for our people.”

The CBN boss noted that gas pricing in the country has become commercially viable to the to the extent that existing investors could expand their operations and that even new investors could be attracted to the Nigerian market.

His words, “What we have done is to ensure that gas pricing is commercially viable. On the day that we decided to review the gas pricing, you would agree with me that it was a major leap. Representatives of your companies, including your Managing Directors , all affirmed that the pricing is now commercially viable to the extent where it encourages you and even prospective investor to jump into the line and invest for more gas.”

The governor said that the money was not just a loan made to pay for gas delivered to DisCos but “a loan with clear development objectives” and that as such gas suppliers should deliver more gas output to existing power plants.

He added that CBN would work with the NNPC to ensure that it played all roles required of it in the MoU to ensure that gas production and gas supply is ramped up immediately. We cannot afford a situation where out of 23 generating plants that we have in Nigeria, 20 are gas-fired and they cannot achieve their optimum level of power generation because of inadequate gas supply.

Mr. Supo Shadiya of the Chevron/NNPC Joint Venture Company, who spoke on behalf of the gas suppliers, said that the payments were a major relief to the sub-sector and pledged that they were now more confident to play greater roles in the supply of stable electricity power to Nigerians.

“There is a very strong commitment on the part of suppliers to domestic gas market and indeed it is important for us to partner with the government to achieve the mission that the government has set for the power sector over the years. We are happy to be part of that”, he said.

According to him, the gas suppliers had been waiting anxiously since November, 2014, when the MoU for the facilities was signed.

He noted however that there were certain enablers which the NNPC had to make available, in line with the provisions of the 2014 MoU and there urged the national oil firm to play its part for a successful implementation of the agreement.

The enablers included gas infrastructure as well as security of facilities which attacks have in the recent past brought power generation to its lowest.

- See more at: http://www.vanguardngr.com/2015/06/cbn-to-clear-gas-legacy-debt-pays-gas-suppliers-n6-9b/?#sthash.6iARKrMF.dpuf

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