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Oil & Gas Industry / Electricity Supply Down By 2,000MW, Says FG
« on: May 26, 2015, 01:57:02 PM »
The Federal Government said yesterday that the nation has recorded a loss of over 2,000 mega watts in the national grid due to shortage of gas supply to the thermal plants.

The government in a statement signed by the Chairman of the National electricity Regulatory Commission, NERC, Dr. Sam Amadi explained that only five out of 23 power plants are currently generating electricity.

Dr. Amadi said that the Commission noticed with concern the acute shortage of power supply and the attendant hardship Nigerians are passing through.

He said "In the last couple of months, electricity supply has been generally poor on account of increase in vandalism in the run up to the April 2015 elections. But this bad supply condition has worsened in the last few days."

According to him: "At present, 18 out of the 23 power plants in the country are unable to generate electricity due shortage of gas supply to the thermal plants with one of the hydro stations faced with water management issue. This has led to loss of over 2,000mega watts in the national grid.

"This situation is further compounded by the recent industrial actions embarked upon by workers in the oil and gas industry, a development which is taking toll on other sectors of the economy. Gas supplies to the thermal plants have been further constrained by the industrial actions of workers in the oil and gas industry.

"The Commission had proactively engaged the gas supply companies and its licensees when two weeks ago discussion was held on how to firm up gas supply in order to increase power supply.

"Unfortunately, not much progress was made through this meeting as NNPC and its subsidiary Nigeria Gas Company, disclosed high incidence of vandalism in some areas that were relatively peaceful along its pipeline networks.

"That meeting was told of the damage done to Trans-Forcados pipeline in the western axis and elps gas pipeline in the eastern axis. Nigerian National Petroleum Corporation had explained at the meeting that repair works are being intensified even as it expressed worry on the integrity of the pipelines on account of incessant damage it has sustained.

"In essence, what has brought about this development is the increased incidence of vandalism which is beyond the control of the regulator and the industry operators. This situation is further compounded by the industry actions declared by the oil and gas workres.

"However, we have continued to engage with relevant authorities on how fast we can address shortage of gas supply to the thermal plants. We are also engaging with the industry operators on how to improve electricity supply.

"The Commission regrets the hardships which Nigerians are being subjected to on account of this development as we intensify efforts to bring the situation under control in the shortest possible time."


The Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, has said the incoming administration of President-elect, Muhammadu Buhari, must ensure that technocrats, not politicians, head the board of Nigerian National Petroleum Corporation, NNPC.

The union said it was the only way government can move towards “achieving effectiveness and curbing wastages of our resources and potentials to improve accountability and optimisation across the polity and economy.”

PENGASSAN’s President, Mr. Francis Johnson, told newsmen in Lagos that the holding company and its 10 subsidiaries can only be effective and adhere to global best practices if not subjected to undue political interference.

Speaking on PENGASSAN’s View on the Road Map to Revamp the Oil and Gas Industry, Mr. Johnson said: “There is need to instil in NNPC the culture of corporate governance and career management, which requires a legislative review to ensure that the board of NNPC is headed by technocrats and not politicians.

“The position of Group Managing Director and Managing Directors of the subsidiaries must be tenure based to check frequent termination of employment by the President that leads to policy somersault and unstable system, which breeds compromise of corporate values and principles.”

He also said Buhari’s government should establish a Petroleum Inspectorate for effective regulation of the sector, and that the Subsidy Reinvestment Programme, SURE-P, for which N21 billion is provided for in the N2015 budget, be scrapped.

On the Petroleum Industry Bill, PENGASSAN said: “There is need for an all-inclusive stakeholders’ summit to harmonise the grey areas and ensure speedy passage of the bill in a fair and equitable manner.”

- See more at: http://www.vanguardngr.com/2015/05/pengassan-to-buhari-technocrats-not-politicians-should-run-nnpc/?#sthash.3qs6VAVU.dpuf

The Chief Whip of the Petroleum Tanker Drivers (PTD) wing of the National Union of Petroleum and Natural Gas Workers (NUPENG), Comrade Gambo Ibrahim Tuge, tells the Sunday Trust some sorry developments at the Kaduna Refining and Petroleum Company, (KRPC)

Since when have you been doing business with the KRPC?

That should be more than 20 years ago when the going at the KRPC was still good and the refining outfit was selling all refined products. The entire North was getting its entire supplies from there. Then, more than 500 trucks would load there different commodities that included petroleum, kerosene, cooking gas and diesel. When it was operating at full capacity, it was servicing depots in as far places as Maiduguri, Yola, Jos, Gusau, Kano, Suleja and Minna, which were getting refined products from the KRPC.

But things at the KPRC have since changed and the situation has further deteriorated during the Goodluck Jonathan administration and under the Minister of Petroleum Resources, Diezani Alison-Madueke. For two years, the KRPC has not been receiving crude oil regularly, and there has been no steady refining and loading of petroleum products for sale.

A certain cabal in the petroleum industry seems to have deliberately sabotaged local refining so they can keep importing refined petroleum products and earn cheap money. Some new oil companies were established to buy and sell imported refined petrol in Nigeria and not to establish their own refineries within.

This is sabotage. This is one area the President-elect General Muhammadu Buhari must look into. If you go to the KRPC you will pity the situation as there is no business activity and when they do bring in fuel based on 'bridging' from the south to the North, they inflate the government-approved pump price.

A marketer with an NNPC licence does not get fuel. But black marketers are dancing to the banks with the authorities not doing anything to arrest the situation. There is too much corruption in NNPC.

Chiyoda of Japan built KRPC but Total of France was once given the turn-around maintenance, is this right?

It is not right at all. How can an educationist be given a patient to operate? We want change.

Why are some filling stations selling petrol above N87 per litre?

If KPRC is working and you put your price a kobo above the government-approved pump price, who will buy it? But in this current situation, if a dealer bought a fuel from the black market at N100 a litre, how can he sell it at N87? It is not possible. But if the NNPC is functioning, every dealer will beautify his station to attract customers. That is why the price in many stations is abnormal. Instead of N87, some are selling at more than N130.

Why is tar used by road construction companies being imported when the KRPC can produce it?

It is because the KRPC is not working well. When it was functioning at its normal capacity, buyers were always available and the refinery management even reduced the price for them. But members of a cabal now imports the tar from abroad after they have sabotaged Nigeria and the North.

For how many months has the KRPC not been refining crude oil?

It has been down for about nine months now. It used to work for like one month and then would be shut down for nine months to one year without any production whatsoever. That has been going on for about five years running.

Is kerosene still being loaded here?

They don't load it here anymore. It is now being sold to cabal members who resell to dealers. Before now, a single truck used to load and discharge to dealers twice daily. But now, you have to go to Lagos, Warri or Port Harcourt to buy from private depots at black market prices and resell as you like. In reselling, dealers factor into their prices the risks they usually undertake, like extortion and accident possibility.

So would you say the NNPC staffers at the KRPC have just been collecting salaries for doing nothing for many months?

That is it. The main cause for concern is the enrolment of many casual staffers who are the main workforce, while the real NNPC staff just collect salaries for doing nothing. These casual staffers, when there is work to do, work hard because they want to be fully employed.


Oil & Gas Industry / Should Buhari Maintain Subsidy Regime?
« on: May 26, 2015, 08:47:34 AM »
Despite the billions of naira paid by the federal government to oil marketers, the president of the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG), Comrade Igwe Achese, and other stakeholders said scarcity of fuel would persist if the refineries are not put in proper shape. In this special report, our reporters, Sylvester Enoghase, Phillip Oladunjoye, Emma Okwuke, Abel Orupke, Saheed Bakare, and Judith Eshemitan examine the subsidy regime of the Federal Government.

Subsidy Payment Would Not End Fuel Scarcity

Despite the billions of naira paid by the federal government to oil marketers, the president of the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG), Comrade Igwe Achese, has disclosed that scarcity of fuel would persist if the refineries are not put in proper shape.

This comes as the coordinating minister of the economy and minister of finance, Dr Ngozi Okonjo-Iweala, recently said the federal government had released N156 billion for payment to oil marketers, leaving a balance of N98 billion certified by PPPRA as the amount owed them.

He told Daily Independent that the N156 billion is the latest in a series of significant payments made to the oil marketers within the last five months. These include over N300 billion in two installments in December last year and N31 billion in interest differentials recently. In all, oil marketers have received over N500 billion within the past five months.

However, Achese who stated that the payment would not end fuel scarcity, while speaking to our correspondent, said scarcity would continue as long as the country keeps importing fuel.

He emphasised that the acute fuel scarcity plaguing most parts of the country has taken a serious toll on residents of36 States, including the Federal Capital Territory, such that motorists have resorted to the black market where a litre of fuel goes for as high as N300.

The development, he said, has left commuters stranded at various bus stops, waiting endlessly for commercial vehicles, most of whom are stuck in fuel queues for several hours.

The Former President of Chartered Institute of Bankers of Nigeria, Mr. Wale Adeyemi however urged the Buhari- led administration to give a thorough look at the subsidy fuel regime with a view to finding lasting solution to unending fuel queues and scarcity occasioned by the disagreement between the marketers and the government.

According to him, it was important government work hard to ensuring that the refineries are in put into proper shape such that importation of fuel comes to an end.

Lamenting the situation faced by Nigerians, Adeyemi said it was regrettable that Nigeria was going through what it was experiencing now despite the abundance of crude oil.

He said:" They should review everything about subsidy arrangement. If they have to stop it, let them stop it. What they have succeeded in doing at the expense of Nigerian masses is to create huge wealth for very few people.

"This is the only country where we have refineries and still import refined crude oil. For me, this is demeaning and appalling. For a country called Nigeria where you have a number of intelligent people and knowledgeable people that is so endowed, I think there is something wrong somewhere which need to be addressed before it is too late. Nigeria's crude oil is the second best. Even in terms of the market, it is better than Saudi Arabia crude oil in the whole world market. They should take the issue seriously".

He pointed out that creating human problems, psychological issues by having to queue for time on ending at filling stations is not the way to go.

"A situation whereby there will be scarcity during the day and availability at night should stop. This comes often as dirty expectation between Nigeria and the republic of Benin. All these are against the economy of the people. The incoming government should address the fuel subsidy regime by bringing an end to the scam in addition to other cardinal programmes it promised to execute", he said.

"They need to address the issue of corruption which from part of what the fuel subsidy issue is all about. Just as they have promised, they must live up to that expectation if at the end of four years, they want to be adjudged to have been fair", he added

For the Chief Executive officer of Wealth Advisor, Mr.Adebiyi Adesuyi , the issue of fuel subsidy could only be best described as fraud which were being done between those in governments and the marketers.

He advised the Buhari administration to demonstrate the political will in solving the myriads of problems confronting the oil and gas sector some of which include taming the activities of the so called few cabal who are bent on holding the nation to ransom through their fraudulent activities.

He said:" What they are spending on fuel subsidy or paying as subsidy to marketers is more than enough to build new refineries for Nigeria, to refine what we need domestically and assist in refining products from other nations".

"Nigeria is the only country that produces the quantity of crude oil we produce and yet still import crude oil. If we don't import crude oil, there won't be issue of subsidy. I can tell you from my background as a banker, having managed about three branches for Oceanic Bank that the whole exercise is a fraud", he added.

Commenting further, he said: "I remembered back then that each time we financed these so called oil importers or marketers, whenever we asked them to make prepayment, the excuse they normally give is that PPRA has not made any payment. By so doing, they have nothing to pay. So, instead of using the primary source to make a payment for the loan, they will be asking for more time. Often time, they divert the money meant for that purpose to other things. They will now be telling you that they are expecting subsidy payment. And that shows you that the subsidy is a scam".

"It is so unfortunate that Jonathan came in together with the outgoing finance minister who had worked with the World Bank, who should know better, and still allow the scam to continue. If it would mean for them to borrows to build refinery and stop the nonsense, they would have done it", he said.

He said in a situation where we are using a quarter of our national budget to pay subsidy, does it make sense?. For me, it does not make sense. So, if Nigerians should pay more for petroleum, the idea of subsidy should be stopped.

Advising the incoming administration, Adesuyi warned the government to be careful of detractors that may want to put the government effort in stopping corrupt practices into abeyance.

He said: "If I have to advise the new government, I think within the next two years, they should give us commitment that they are building refineries. More so, the products are now being refined locally such that it can meet local demand. Apart from meeting local demand, they should also export refined products not the situation where we depend on imported products.

"As we are importing refined products from other countries, we should begin to export refined products once the refineries are in place. Once this is done, we will be able to curtail the decline in the value of the naira. Aside the benefit of curtailing devaluation of naira, we will be able to anchor foreign exchange through value addition.

"Once again, I need to reiterate that the fuel subsidy is used to siphon the wellbeing of average Nigerians. Take for example, if Jonathan administration had said no to fuel subsidy and concentrate on building refinery from the foreign reserve Obasanjo left, I don't think the situation we are witnessing now will occur. This was messed up due to the interest of just some few people. As you can see, most of them have started penetrating Buhari. That is the way they do. And that is why they are creating the scarcity we are facing now. All these set of rogues are doing is to arm-twist him. So, he needs to put his foot on the ground. Even if you look through the figures, you will realize that the subsidy is inflated", he however said.

The Chief Executive Officer of a public relation firm, Kishi Lagos, Mr Adeola Adejokun said issue surrounding fuel subsidy in Nigeria has created more than enough problems some of which he identified to include traffic gridlock, wastage of productive hours and long queues in filling stations.

He said there is the need for government to put an end to the problem considering the untoward hardship Nigerians have been made to suffer particularly in the last few weeks.

He recalled that a former CBN governor had raised the issue of $20 billion naira which was left unaccounted for on the basis of fuel subsidy noting that it has become imperative to end the subsidy crisis with a view to bringing smiles to Nigerians. To him, the continued implementation of subsidy boils down to the growing level of corruption in the system which he urged the new government to address to bring an end to the issue of fuel scarcity.

A Lagos based lawyer, Barrister Kabir Akingbolu, has suggested ways that will not only make the policy achieve its goals but also make it acceptable to the Nigerian citizens. He said nothing was wrong allowing subsidy but the way it was being managed.

Akingbolu, who spoke to Daily Independent in Lagos, said if corruption in the country and stealing in high places could be checked, the country will have enough resources that will make life worth living for its citizens.

He noted that the high level of corruption in the society has made the average man in the street to become suspicious anytime the government makes a proposal that affects the welfare, stressing that government in the past have deceived the populace by making unfulfilled promises.

He said:" There are so many corruption in the system. Government must ensure that sanction await those who connived to defraud the system. Even though the fuel subsidy regime as being described as somewhat fraudulent, there is need for the new government to exercise restraint and be more circumspect in taking decisions on subsidy. If you look at the state of things at the moment, I think it will better to allow subsidy to remain but not at an inflated figure as we have now. Pending when refineries will be built, government should allow fuel subsidy in the interest of Nigerians who may not be willing to endure the pay".

Another commentator, Samuel Ajayi, a brand analyst who groaned at the level of sufferings being encountered by Nigerians on account of current fuel scarcity, urged the incoming administration to be prepare to confront and step on toes as he embarks on a cleaning exercise in the oil and gas sector.

He said: " Over the years, the oil and gas sector has always been a major problem for leadership. One reason adduced to this problem comes from the background of enormous challenges confronting it".

"The new government, as they have promised during the electioneering campaign, should be ready to battle the unseen forces because so many underhand dealings happen in the oil sector. It is also important to state that government should ensure that there is transparency to engender competition and trust. That is not so say that professionalism should be dispensed with. I am of the view that fuel subsidy or not, the oil and gas sector need total reform. There is so much corruption in that system. Until that is removed, I don't think there can be any progress. All those who engage in corrupt practices in the system should be given the boot or flushed out. There is too much rot", he added.

Another public affair analyst who is a banker, Mr Ahmed Kareem stated that the government actions in the past had made people to lose faith in any of its programme.

He however said, it was important that the new government create enough room for Nigerians to believe it by living true to its promises .According to him, government must do all within its capability to make its word its bond.



Following reports of the suspension of the industrial action embarked upon by the Nigerian National Petroleum Corporation (NNPC) in-house members of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and National Union of Petroleum and Natural Gas Worker Association of Nigeria (NUPENG), the Managing Director of Capital Oil and Gas, Mr. Ifeanyi Ubah, has said it is not too late for President Goodluck Jonathan to fully deregulate the country’s downstream petroleum industry.

The unions were protesting government’s recent transfer of operating rights of Oil Mining Leases (OMLs) of the Nigerian Petroleum Development Company (NPDC) to private companies.

Ubah, on the heels of the suspension, called on Jonathan not to bequeath to the incoming government of Muhammadu Buhari, a regulated fuel price regime.

He made this call monday while reacting to his decision to breach an order on the nationwide oil workers’ strike and subsequently decided to go ahead to open up the company’s petroleum loading facility at Ibafo in Lagos. THISDAY got his reaction via an e-mail in Abuja.

His reaction and request on Jonathan however came when members of the NNPC in-house PENGASSAN and NUPENG called off their strike and allegedly pledged to work 24 hours to restore normalcy in the country’s energy sector.

However, the strike according to the Nigerian Electricity Regulatory Commission (NERC) and Minister of Power, Prof. Chinedu Nebo, has left 18 of Nigeria’s 23 power generating plants down, meaning that just about five power plants are generating a meager 1,327 megawatts (MW) as at Friday last week.

Ubah claimed that his action on Sunday had motivated the unions to suspend their strike, saying it was a bold intervention to save Nigerians from further crises.

“I felt I would be acting irresponsibly to watch Nigerians dying in hospitals, languishing in filling stations without buying the product and keep quiet. So I had an obligation as a Nigerian not to allow that continue, and I bet you that if I did not make that move, the strike would have been on today,” he said.

He also lamented that a situation where hospitals were shut down, telecoms threatened to stop operations and power supply crippled should not be tolerated by anyone who means well for the nation.

According to him: “You can understand the extent and enormity of the crises when even banks threaten to close shop because they don’t have fuel to power their generators since the public power system has also crumbled. So, I felt it a duty as one who operates the largest fuel supply base in Nigeria to turn around the situation.

“By today, I am sure we have already achieved the 13 million litres or 400 truck-loads target and we have product in the jetty and will not stop pumping.

According to him, “I am assuring Nigerians that what we did on Sunday was not a flash in the pan but real action and resolve to make sure the scarcity is defeated.”

In a few days, it would be over. That is why we call on the president to declare total deregulation even a day to his exit,” he added.
“In his advocacy for deregulation and removal of fuel subsidy, he stated that it would be a great act of patriotism for Jonathan to declare total deregulation of petroleum pricing.

“I envisage a situation where oil would sell at about N85 for a litre when deregulated because that will encourage competition among operators and also create the incentive for local refining. When that is achieved, more jobs will come and the entire economy would be more robust and gain from the development,” he stated.

Meanwhile, NERC explained in a statement that at present, 18 out of the 23 power plants in the country are unable to generate electricity due to shortage of gas supply to the thermal plants while one of the hydro stations is faced with water management issue.

It said the development has led to loss of over 2,000MW in the national grid, thus confirming the Nebo’s assertion that major gas plants including Utorogu, Chevron Orodo, and Oben in the western axis, as well as Ughelli and CNL Escravos are shut down.

Nebo also stated that on the eastern axis, Shell Gas, Alakiri has been down. He thus asked the unions to quickly take remedial steps to restore gas supply to the nation’s power stations.


Oil & Gas Industry / How to make Nigeria’s energy cost less
« on: May 21, 2015, 04:15:36 PM »
Higher electricity prices would stimulate gas production in Nigeria and reduce blackouts and the need for expensive generators according to comments Dada Thomas, managing director of Nigerian exploration and production company Frontier Oil, made to TOGY. The growth and improvement of the domestic gas value chain is at the forefront of political and industry discussion in Nigeria, a country that combats daily blackouts due to power generation deficits and a lack of available feedstock.

Gas shortages in Nigeria are preventing electricity generation companies from operating at full capacity in a country that is woefully undersupplied with electricity. The shortage of gas as a feedstock for power stations is causing a snowball effect moving down the value chain because undersupplied distribution companies are not getting enough electricity. The transmission company is held by the government, which also fixes the price of electricity and gas. “The transmission company should be decentralised, with each one of Nigeria’s six zones having its own autonomous branch,” Dada Thomas, managing director of Frontier Oil, told TOGY.

RATED RATES: Nigeria has a power shortage of 160 GW. For every 1 million people, the country must generate 1 GW of power to meet global standards of living.

For even half of this capacity, the country would require 736 mcm (26 bcf) of gas production and feedstock per day. As of now, the electricity rate at consumer level is set at $0.06 (NGN10) per kilowatt hour, but due to power shortages and a reliance on generators during blackouts, consumers can pay up to $0.35 (NGN60) per kilowatt hour.

“For consumers and business alike, it would be better to set the price of electricity at NGN30 ($0.18) per kilowatt hour, as it would improve the incentives and economics throughout the value chain,” said Thomas.
With a higher base-level price, the government could raise the price of gas at the production level from the current $2.50 per thousand cubic feet (per million British thermal units), further incentivising gas production for domestic usage. Generation companies would then curtail their feedstock problems and generate more electricity for distribution companies to provide to the transmission entity.

Production, generation and distribution companies would be able to amortise fixed and sunk costs over a higher throughput, increasing per-unit profit margins and allowing for greater investment at all levels. “This simple change would remove the hassle of having to deal with generator mechanics and looking for diesel or petrol along with the safety hazard of storing petrol in one’s own house,” Thomas told TOGY.

RAISING THE BENCHMARK: While improvements have been made to the pricing of gas production, an increase from $1.50 to $2.50 per thousand cubic feet (per million Btu), there is still room for greater parity with international prices.

“The new $2.50 per thousand cubic feet (per million Btu) benchmark has been celebrated, but this is not high enough to be an attractive option to produce gas. If it were raised to around $5 per thousand cubic feet ($5 per million Btu), then it would create a very attractive and comfortable environment. Even international oil companies would want to jump into the domestic gas market,” said Thomas.

Nevertheless, domestic producers can continue to be at the forefront of the gas revolution. “When you look at the landscape of companies investing in gas, most are indigenous firms. As the domestic exploration and production segment continues to grow, gas production can serve as a steady, long-term base of revenue that can help shelter companies from dips in oil prices,” he added.

TAX INCENTIVES: Pioneer status relief could also help to stimulate and encourage investment in gas production. Pioneer status relief is a three to five year tax exemption given to new investing companies.

As of 2014, this pioneer status exemption was limited to downstream projects. The fiscal regime is proving to be a bottleneck to further investment. Pre-tax, 1,000 cubic feet of gas was one-seventh the value of a barrel of oil, as of December 2014. Yet, a gas production project’s capital expenditure is three times greater than that of an oil project.

“With these costs, the production of gas becomes a nice, reliable baseline, but you cannot use it to pay your bills up front, especially if you have just newly invested and are paying off your loans,” Thomas told TOGY.



The crisis in the oil sector seems to be deepening as workers of the Nigeria Petroleum Development Company (NPDC), under the aegis of the Petroleum and National Gas Senior Staff Association of Nigeria, PENGASSAN, and the National Union of Petroleum and Natural Gas Workers, NUPENG, early this week, shut down their operations.

The unions directed NPDC employees, a subsidiary of the Nigerian National Petroleum Corporation (NNPC) to shutdown indefinitely their locations and all oil production facilities nationwide in a bid to force the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke and the Federal Government to reverse the transfer of operatorship of OMLs 42, 40 and 30.

The assets were previously operated by Shell.

The unions are aggrieved that the sale of the assets did not follow due process and would affect the fortunes of the NPDC and its workers.

Mr. Emeka Offor’s Elcrest Exploration and Production Nigeria Limited, a joint venture company of Eland Oil & Gas Plc, was awarded the operatorship of OML 40, while Mr. Ernest Ezedialu Obiejesi’s NECONDE is the operator of OML 42.

A source from the union, who pleaded anonymity, said the strike is not national, adding that it is only an arm of the NNPC in Benin.

He said the workers are agitated   that they were kept in the dark by the management in the entire process, and are of the opinion that management’s decision would not only threaten their jobs, but will jeopardise the future of the industry.

He said the strike had resulted from a breakdown in communication between the management of the company and the unions.

Speaking on the development, the President, Trade Union Congress, TUC, Comrade Bobboi Kaigama, calls on  the Federal Government to immediately halt and reverse the last minutes transfers of the operatorship of OML 42, OML 40 and OML 30,  which are being arbitrarily handed over to Neconde Energy Limited, Eland/Elcrest and Shore Line respectively.

”We demand immediate reinstatement of the operatorship rights of the Nigeria Petroleum Development Company (NPDC), the NNPC subsidiary that has been successfully operating the assets to avert the brewing industrial crisis in NNPC in view of the impact it will have on the ongoing transition process,” Kaigama said.



The direction and programmes of the incoming administration of Major General Muhammadu Buhari (rtd) appears to be emerging with the guide being offered in the form of start-up reform marshal plan by a former British Prime Minister, Mr Tony Blair, who urged him to carry out a complete overhaul of the Nigerian National Petroleum Corporation (NNPC) and solve the problematic petroleum subsidy regime within the first 100 days of assuming office. The recommendation is in synch with the call by the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) for the incoming Buhari administration to declare a state of emergency in the oil sector given its myriad of problems. Blair’s policy pep-talk came just as the Vice-President-elect, Prof. Yemi Osinbajo, gave a frightening picture of the country’s economic situation, saying that Nigeria’s local and international debt burden has hit $60 billion, while the debt servicing bill for 2015 is N953.6 billion (about 21%) of our budget.

The ex-British prime minister, who was represented by Peter Benjamin Mandelson, a former Secretary of State for Trade and Industry, at a two-day All Progressives Congress (APC) Policy Dialogue holding in Abuja, yesterday advised that the government should as a matter of priority undertake the shake-up in the management of NNPC within the first 100 days of assumption of office. Blair said the new government should try to utilise the enormous goodwill it presently enjoys to take far-reaching economic decisions, including taking an intelligible stand on the controversial fuel subsidy policy. “You have more goodwill to do very difficult things at the beginning of your administration than later. You can crack the NNPC with the first 100 days,” he said. According to Blair, Nigeria has huge natural endowment of energy resources but could not effectively utilise such rich resources to economic advantage because of misplaced priorities.

“These issues are like this, for a country that has extraordinary resources of oil and have this amazing privilege of source of energy, yet power generation was not as good as it should. People having to wait for hours queuing to get fuel and end up buying it elsewhere. I think the resources voted for this subsidy can be better used for other things. “Where is it running away to? I think we need to recapture this oil resource and the revenues put to good use so that it can be invested for the long term good of the country, in infrastructure, human capital development, education system and skill acquisition that people need to work with in the future. “This is where the money should be going to. That is why before reorganisation and also the long reach of the law, there is the need to begin here pretty soon in order to make sure the system as whole works better for Nigeria. That is my view,” he said.

Exhibiting deep knowledge of Nigerian internal political dynamics, the Briton further advised Buhari not to turn his back on the people of the South-east and South-south based on the perception that he did not get the support of the voters from the zones. “You need to show the people who did not vote for you that you care for them and will work to solve their problems as much you will do for those that supported you. This is what is called ‘Big stake politics’,” he said. He also advised the government to tackle frontally the problem of unemployment immediately after taking over the administration of the country if it must successfully reduce youth restiveness and sectarian crisis.

He said that everything must be done to avoid allowing a return to the usual bad ways of doing things. While declaring the policy retreat open, Prof. Osinbajo, who also stood in for Buhari, said the country’s economy is currently in its worst moment in history. Apart from the figures of extreme poverty in the country, which he said had now affected 110 million Nigerians, Osinbajo said the country’s local and international debt stands at $60 billion, while the nation’s debt servicing bill for 2015 is put at N953.6 billion, 21 per cent of Nigeria’s budget. “The figures of extreme poverty in our society — 110 million by current estimates — makes it clear that our biggest national problem is the extreme poverty of the majority. Thus, no analysis is required to conclude that dealing with poverty and its implications is a priority. “We are concerned that our economy is currently in perhaps its worst moment in history.

Local and international debt stands at US$60 billion. Our debt servicing bill for 2015 is N953.6 billion, 21% of our budget. On account of severely dwindled resources, over two-thirds of the states in Nigeria owe salaries. Federal institutions are not in much better shape. Today, the nation borrows to fund recurrent expenditure,” he said. Osinbajo drew the attention of the gathering to some of the key issues raised by the party during the campaign which included addressing the challenges of economy, insecurity, corruption and job creation. Osinbajo lamented the highly unequal society in which the country had found itself, adding that “the largest chunk of the benefits of our national wealth accrues to a small percentage of our population”.

He said the APC manifesto has offered a vision of shared prosperity and socio-economic inclusion for all Nigerians, that leaves no one behind in the pursuit of a prosperous and fulfilling life. According to the vice-presidentelect, the goal of the policy dialogue is to “interrogate the various positions and propositions before a wider audience and to launch a robust public conversation on policy directions and priorities that will help inform our administration’s approach in the next four years”. “This forum exemplifies the sort of consultative and consensual approach to policymaking that our party and the new administration intend to model in office,” he said.

In his remarks, the Director of Policy, Research and Strategy in the Directorate of the APC presidential campaign, Dr. Kayode Fayemi, said the phase of policy conception is over and that the party should now be thinking of “execution, governance and of providing tangible developmental deliverables”. The policy dialogue continues today with presentations by panelists drawn from various sectors of the economy and social backgrounds.

In the same vein, citing a plethora of challenges bedevilling the Nigerian oil and gas industry, PENGASSAN has urged the incoming administration of Buhari to declare a state of emergency in the sector to address its many problems. The oil workers argued that all sub-sectors of the oil and gas industry are going through one problem or the other which are not only dwindling the fortune of the sector, but the entire Nigerian economy as the sector currently accounts for more than 80 per cent of Nigeria’s foreign exchange earnings In a statement by PENGASSAN’s President, Mr. Francis Johnson, the senior oil workers said there are many issues in the oil industry requiring urgent attention from the in-coming government.

They urged Buhari to reposition the industry for efficient and effective delivery of its benefits to Nigerians. Johnson also noted in the statement that there is need for the in-coming government to call an all-inclusive stakeholders’ forum of those involved in operations in the sector to critically examine and proffer workable and enduring solutions to all the problems in the larger interest of the Nigerian nation.

Johnson said: “All the subsectors of the oil and gas industry have one challenge or the other and all these challenges are affecting the deliveries of the benefits of our God-given hydrocarbon resources to the country and the entire people of Nigeria. “These challenges are as a result of past neglects, wrong policies and policy summersault in some areas of the subsectors.

All these are inflicting pains on Nigerians who ought to be enjoying the benefits of the natural resources that God bequeathed to the country.”


Fresh facts have emerged on the shutting down of oil production by oil workers employed by the Nigerian Petroleum Development Company (NPDC) over the transfer of operatorship of Oil Mining Lease (OML) 42 to Neconde Energy Limited.

Stakeholders in the oil industry say the actions of the workers under the aegis of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and the National Union of Petroleum and Natural Gas Workers (NUPENG) are not in the interest of the country.

According to a source, “it is a pity that NPDC workers will go to this length in order to protect their selfish interests. We all work here and we know that they cannot afford to do what Neconde and Seplat are doing. Rather, they want to arm-twist the government, especially the incoming administration of President elect, Muhammadu Buhari, so that he will not be sympathetic to Neconde, Seplat and others.

“Let me also reiterate that OML 55 under the operatorship of Seplat where Seplat has only 22.5 per cent stake but it is raising the value and volume of production as operator as opposed to the poor performance of NPDC under other mandates,’’ the source who advised the government to ignore the two associations, noted that both of them were feathering their nests and that it would be better for the private operators to bring their expertise to bear in the industry.

While debunking newspaper reports by NPDC branch of NUPENG and PENGASSAN, accusing Neconde of propagating reports of incompetence to operate OML 42, Neconde’s Managing Director, Malije Okoye said in a statement “that on no occasion has Neconde made defamatory statements about NPDC in the media or anywhere else and Neconde is in no way in breach of any applicable rules.

“Records clearly show that the ceding of the management of OML 42 to Neconde Energy had nothing to do with the firm’s stake in the oil block. The transfer of management of OML 42 to Neconde was evidently about leveraging a national asset and obtaining optimal value, for which Neconde clearly showed proof of capacity to deliver.’’

He added that “despite the transfer of operatorship of OML 42 to Neconde, NPDC and Neconde still exist as partners at the level of ownership rights on OML 42, the Federal Government having ceded management to Neconde. Accordingly, Neconde will not be drawn into a disagreement with its partners on the pages of newspapers.

“The issues raised into consideration, Neconde will avail itself of the dispute resolution mechanism available under the joint venture platform to address all concerns relating to the transfer of the management of OML 42 to Neconde, as we are resolutely committed to fulfilling the government’s mandate of raising the production ceiling of OML 42.

“Neconde will continue to work in conjunction with our partners in the NPDC, who clearly require our professional expertise in this regard and have been working assiduously on the transfer of the management of OML 42 to Neconde. Neconde remains supportive of the Federal Government’s policy on local content in the oil and gas industry and the liberalisation of the upstream oil sector in order to optimise value and make the industry work for the good of all, not for a few vested interests, either in government or in the private sector,” he added.

It would be recalled that as the NPDC branch of PENGASSAN was pushing back on the Nigerian government’s granting of operatorship of the OML 42 to Neconde, the Minister of Petroleum went ahead to grant the wishes of Elcrest for operatorship of OML 40.

At the moment, Neconde and Elcrest purchased 45 percent stakes in OMLs 42 and 40 respectively from Shell, TOTAL and ENI in 2012, but the operatorship of the assets were not granted with the purchases. The two companies, along with First Hydrocarbon Limited, Shoreline Resources and NDWestern, who bought stakes in OMLs 26, 30 and 34 between 2011 and 2012, have lamented NPDC’s lack of capacity to continue as the operator of the acreages they purchased from the Shell-led consortium.

Their argument was that they could have gotten more production out of the fields than NPDC was doing as operator.  The government agreed with them and the perception in the industry was that the remaining three companies would soon be granted operatorship. However, the employees union is asking for a reversal of the two operatorships that have been granted.


Oil & Gas Industry / Nigeria Seeks Massive Investment in Gas Sector
« on: May 18, 2015, 08:21:45 AM »

State owned Nigerian National Petroleum Corporation (NNPC) is seeking massive investment in country’s natural gas sector.

According to a report published earlier this month in The Guardian Nigeria, Ohi Alegbe, the Group General Manager, Group Public Affairs, NNPC said in a statement that the measure was aimed at ameliorating the effect of drop in crude oil prices on the Nigerian economy.

Group Managing Director, NNPC, Joseph Dawha, had stated this earlier at a panel session at the Offshore Technology Conference (OTC) in Houston, Texas, USA.

"The Nigerian gas sector has seen tremendous focus in the last few years. We have grown capacity at a pace of 18-20 percent with supply now at about two billion cubic feet of gas per day in the domestic market from a humble start of about 300 million cubic feet per day a few years ago," Dawha said at the event.

He noted that in spite of the annual investment of millions of dollars in the last four years in gas supply and infrastructure, there was need for significant addition to infrastructure and supply development.

"For example, we have built over 500km gas pipelines and we are building an additional 120km currently; but we need to build many more kilometers of pipelines to connect new markets and gas sources. We need investments in gas processing, micro-Liquified Natural Gas, Compressed Natural Gas as well as upstream Non-Associated Gas (NAG) development. Therein lie the compelling investment opportunities," he said, reported The Guardian Nigeria.

"We can turn the gloom inherent in low price into a breakthrough for gas based industrialisation of Nigeria," Dawha stated


The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has called for the repositioning of the Pipelines and Products Marketing Company (PPMC) to end the intractable and inefficiency in the distribution and supply of petroleum products across the country.

According to the group, if the challenges confronting the operations of the PPMC are not resolved, it would be difficult for petroleum products to be available in all parts of the country and at relatively the same prices.
The trade union noted that the PPMC is not only crucial to the distribution of refined petroleum products but also to efficient and effective performance of the refineries as it supplies crude oil, which is the feedstock for refineries’ operations.

PPMC has depots in Port Harcourt, Enugu, Calabar, Aba, Gombe, Yola Ibadan, Ilorin, Makurdi and other major states’ capitals throughout the federation.
PENGASSAN argued that if the PPMC, a subsidiary of the Nigerian National Petroleum Corporation (NNPC) was repositioned and the pipelines are functioning as supposed to be, there would be more jobs and pressure on Nigerian roads would reduce.

Some of the challenges hampering the effective and efficient operations of the PPMC listed by PENGASSAN include insecurity of pipelines and staff of the company, inadequate funding, ageing equipment, supply of substandard operational equipment, shortage of manpower, irregular capacity building for existing staff of the company and lack of reliable fire trucks and good safety standards.

PENGASSAN noted that the greatest challenge confronting the PPMC is vandalism of pipelines by criminals and economic saboteurs.

Explaining the implications of the challenge, PENGASSAN said: “The negative impacts of the pipeline vandalism on the nation’s economy and the oil and gas industry are enormous. Such include non-functionality of existing refineries, increased operational cost, job losses, reduction in investments in the downstream sub sector and inability to attract new investment, and inadequate supply/availability of refined petroleum products in other parts of the country.

“The efficiency and functionality of the nation’s refineries are continuously frustrated by inadequate crude oil supply which is as a result of vandalisation of pipelines that supply crude to the refineries. The refineries are continuously starved of crude oil supply with possibility of forcing a shut down.

“The inadequate availability and scarcity of refined products across the country can also be attributed to pipeline vandalisation, as distributions of petroleum products which are supposed to run through pipes to various parts of the country are vandalised.

“Both the crude and refined products are piped through the pipeline manage by the PPMC. If the pipelines are effectively policed and secured, there will be regular supply of crude to the refineries and those imported and stored in tank farms to be piped to depots across the country for effective distribution to engender adequate availability of the products.”

The trade union also noted that many of its members were attacked and killed by the vandals in line of duties to fix and repair pipelines broken and damaged by the vandals.

While demanding that the government should evolve the political will to deal with pipeline vandalisation by using modern technology to secure the pipelines, PENGASSAN called for overhauling of the security agencies that are in charge of providing security for the pipelines, as it accused some of the officers of connivance with the vandals.

PENGASSAN bemoaned the inadequate funding of PPMC, adding that most of the company’s equipment are ageing and are in bad shape.

“The equipment are ageing as some of them that have lifespan of 15 years are over 35 years old and are not well maintained. Even when maintenances were to be carried out, we discovered that contractors usually supplied substandard materials for the repair and maintenance.

“Some of the ageing equipment are fire trucks, which are as old as 40 to 45 years. There is need for the government to purchase new fire trucks to combat any fire incident on the pipelines", the group added.


CRISIS is brewing in the oil industry as staff of the Nigerian Petroleum Development Company, NPDC, in Benin City, Edo State, commenced the shut down of oil facilities in the Niger Delta in protest over the alleged illegal sale of OML 42, one of the company’s priced oil blocs by the Federal Government.

Staff of the company embarked on a three-day warning strike last week, but Vanguard learned that the workers have vowed to continue the strike until the Federal Government reversed the sale of the oil bloc which they alleged was sold to one of the NPDC contractors which, according to them, did not follow due process.

A union member who craved anonymity told Vanguard:  “Our sister companies like the IDSL and NNPC, have all indicated interest to join the strike and the meaning is that tomorrow, there will be total shut down of all oil facilities in the Niger Delta. We have commenced shutting down some since Friday.

“We tried to shut down the OML 42 which they sold but the Federal Government deployed hundreds of soldiers to stop us. So, we left there because we don’t want to expose our members to danger but that will not deter us. Our Managing Director, Mr Anthony Muoneke, is supposed to come back today from Abuja, but we will shut him outside the compound. We have been told that he is coming with soldiers but we shall see if he will kill all of us.

“So, the nation should expect a total shut down of oil facilities as from Tuesday. We will resist any attempt to intimidate us,” the source said.

Reacting to the brewing problem, the former Minister of State (Works), Dr. Chris Ogiemwonyi, also a  former Group Managing Director of NPDC, described the alleged sale of the OML 42 as criminal and threatened to head to court on the issue.

He said: “I tried not to believe that the management of NPDC will be selling their assets, the reason being that when we started NPDC, I remember our first project was Oredo field project. We used that field to acquire expertise, more or less a training ground. So, if what we are hearing is true, then there is a problem. Instead of growing capacity they are now dissipating capacity.”

- See more at: http://www.vanguardngr.com/2015/05/npdc-nnpc-workers-shut-down-oil-facilities-over-alleged-sale-of-oml42/?#sthash.ujcfePa0.dpuf

Oil & Gas Industry / Nigeria loses ranking in global NLG market
« on: May 18, 2015, 07:46:08 AM »

Nigeria’s increasingly dwindling revenue earnings from crude oil and derivatives export to the global market appear to be heading for the worse as the country has lost substantial share of its Liquefied Natural Gas, NLG, export share to the global market.

Indeed, Nigeria is believed to have suffered a major decline in its LNG export, dropping three points to account now for about five per cent of the market share, down from the previous eight per cent share it controlled in the market.

The General Manager of the Nigeria Liquified Natural Gas, NLNG, , who gave the hint yesterday, projected that the loss of NLG supply volume may have translated to about $3 billion revenue loss to the country.

“We use to pride ourselves that we supply eight per cent of global LNG, but I think we’ve gone down to about five per cent today.

“And if we manage to do Train 7, which will add additional 8.5 million tons of production, we should be able to, maybe not get back to eight per cent, but at least move up beyond the five per cent where we are today,” he added.

Explaining that the cost of importation had risen by about 30 per cent, the general manager said the fall in the price of Nigeria’s Brent crude warranted a reduction in foreign revenue earnings for the country, stressing that this would affect projects.

Olinma said: “In Nigeria, I haven’t heard of big announcements but clearly it will affect the ability to reach investment decisions for those projects on which we haven’t had investment decisions taken.

“And for Nigeria LNG, as at the end of April, we’ve seen 30 per cent reduction in our revenue. And the reason we are still where we are is that we do have what we call the lag effect on our prices.

“This is because, normally our prices are not based on the Brent of the day, but on an average of six months Brent. So, we still carry over some of the high Brent prices. But even with that we’ve lost 30 per cent of our revenue as at the end of April compared with the 2014 revenue.

“And of course, in terms of revenue, our portfolio generates a revenue of over $10bn on the average. So when you look at the fact that we are losing 30 per cent of that, you will agree that it is quite a lot of reduction in revenue for the country.”

Olinma stated that one way to mitigate this kind of revenue reduction was to increase volume and gain market share.

He, however, regretted that the gas company had lost some of its market share due to stiff competition in the global gas market.

Olinma observed that many countries were making massive investments in the LPG market, adding however that the country’s domestic market has good potentials.

Meanwhile, Nigerians paid slightly higher for goods and services in April as the Consumer Price Index, CPI, which measures the general price level in an economy, rose marginally by 8.7 per cent (year-on-year), representing 0.2 percentage points from the 8.5 per cent rate recorded in the preceding month.

The April index, which is the highest inflation rate recorded for the year so far, was the fifth consecutive month the economy experienced a faster increase on the Headline Index.

According to the CPI’s Statistical News published yesterday by the National Bureau of Statistics, NBS, the faster pace of price increases was the result of advances in most Classification of Individual Consumption by Purpose, COICOP, divisions that yielded the Headline Index, with the exception of slower increases in Recreation and Culture, and Communications Divisions.

The Bureau reported that the faster pace of increases was also observed in the Food and Core sub-indices as obtained during the month under review, the Food Subindex rose by 9.5 per cent, up from 9.4 per cent in March as a result of increases in most of the groups that yielded the index.

It noted, however, that the pace of increases was weighted upon by a slower increase in the Meats, Fish and Dairy groups.

NBS stated:“On a monthon- month basis, food prices slowed in April relative to March, increasing by 0.9 per cent, from 1.0 per cent. Prices slowed in most groups that contributed to the Food index with the exception being the Oils and Fats groups, which increased at a faster pace.

“On a month-on-month basis, the highest price increases were recorded in the Potatoes, Yam and Other Tubers, Oils and Fats and Bread and Cereals groups.

“The average annual rate of change of the Food subindex for the 12-month period ending in April 2015 over the previous 12-month average was 9.5 per cent. The 12-month rate of change has held steady for 11 consecutive months.”

According to the agency, the pace of advances recorded by the “All Items less Farm Produce” or Core subindex, also increased for the fourth consecutive month in April, with the Core Subindex increasing by 7.7 per cent (year-on-year), 0.2 percentage points from 7.5 per cent recorded in March.

Expatiating on the “All Items less Farm Produce” pace, the NBS stated that the pace of increases was strongest in the Clothing and Footwear, Furnishings and Household Equipment Maintenance; and Restaurants and Hotels Divisions.

On a month-on-month basis, the bureau observed that the largest increases were recorded in the Fuels and Lubricants for Personal Transport Equipment, Liquid Fuels and Passenger Transport by Road groups among others, with the average 12-month annual rate of rise of the index recorded at 6.9 per cent for the twomonth period ending in the month under review, unchanged from the 12-month rate recorded in December.

The bureau also reported that on a month-on-month basis, the Headline Index eased marginally in April, increasing by 0.8 per cent; lower from 0.9 per cent in March, adding that prices increased at a slower pace across most COICOP divisions, with the exception of the Transport and Communications Divisions which increased at a slower pace.

When analysed on yearon- year basis, NBS noted that both the Urban and Rural Price Indices recorded marginally higher increases during the month under review as Urban Index increased by 8.7 per cent, from 8.6 per cent in the preceding month, while the Rural Index increased by 8.6 per cent, 0.2 percentage points higher than 8.4 per cent in March.

The agency stated further that on a month-onmonth basis, both the Urban and Rural Indices increased at a slower pace in April, increasing by 0.8 per cent and 0.7 per cent respectively.

Similarly, it pointed out that the percentage change in the average composite CPI for the 12-month period ended April over the average of the CPI for the previous 12-month period was 8.2 per cent, the same rates recorded in March this year.


Oil & Gas Industry / We need working Refineries - PENGASSAN
« on: May 16, 2015, 01:54:48 PM »

The Petroleum and Natural Gas Senior Staff Association of Nigeria has expressed optimism about the state of the country’s refineries and their chances of working at optimal capacity, The Punch reports.

The association said the road to achieving and improving local refining capacity of petroleum products to take care of local demands might not be difficult if the government could put some machinery in place.

Major among these, it noted, was ensuring that the existing four state-owned refineries, the Port Harcourt Refining Company(two refineries), Warri Refining and Petrochemical Company and the Kaduna Refining and Petrochemical Company, functioned at optimal capacity.

The association said unfortunately, the two refineries in Port Harcourt had not been functioning at optimal capacity due to some challenges, which made Nigeria to be missing the full benefits of hydrocarbon resources. Some of these challenges listed by PENGASSAN include refusal by the government to carry out Turn Around Maintenance on the refineries as and when due.

It will be recalled that the government reached an agreement with the union on January 7, 2014 to commence TAM on the PHRC but till date the process is yet to commence.


Oil & Gas Industry / Lagos Gridlock May Not End Soon - NUPENG
« on: May 16, 2015, 01:53:23 PM »
The harrowing experience of Lagos motorists and commuters, arising from the fuel scarcity and gridlock on roads may not end anytime soon. According to Mr Tokunbo Korodo, the South-West Chairman of the National Union of Petroleum and Natural Gas Workers, the trucks causing the gridlock may not leave the roads soon as directed by the Lagos State Government.

Korodo told newsmen in Lagos on Thursday that only three depots out of over 50 in Lagos had petroleum products to dispense. The development had compelled hundreds of trucks to head for the three depots to lift oil. He said that the development was the key reason for the unprecedented traffic jam that had locked down Lagos in recent days. The Lagos State Commissioner for Transportation, Kayode Opeifa, had on Wednesday chaired a meeting with the stakeholders in the oil industry where the government directed the tankers and trucks to vacate the bridges and roads.

"No tanker should be seen on Eko, Liverpool and Coconut among other bridges. "By Thursday, the tanker owners should make one lane available for motorists to use pending the expiration of the ultimatum for enforcement to begin," the commissioner said. The stakeholders at the meeting are NUPENG, Petroleum Tankers Drivers (PID), National Association of Road Transport Owners (NARTO), Association of Maritime Truck Owners (AMATO) and Independent Petroleum Markers Association of Nigeria (IPMAN),

Residents in Nigeria's economic capital have faced tough times, trying to buy gasoline and their woes have been made worse by a lock-jam on most roads in the city. Korodo named the three depots currently having oil as Capital Oil and Gas Tank Farm, Ibeto Oil and Gas Tank farm and Integrated Oil and Gas Tank Farm, all in the Apapa. He said the gridlock could ease if trucks queuing for oil would load and leave Lagos by weekend. But such scenario is not likely, according to observers.

Korodo suggested that the Nigerian National Petroleum Corporation should decentralise loading of petroleum products to ease the pressure on Lagos. According to him, that is the only way Lagos residents can get reprieve from the gridlock, which has forced transport fares and cost of foodstuff up. Meanwhile, many Lagos residents, including women and children resorted to trekking distances to get to their schools, businesses and places of work. Residents of Mushin, Ojuelegba, Surulere and Constain-Apapa areas found it impossible to commute to Lagos Island because of a total lock-down at Costain Roundabout.

Some motorists abandoned their vehicles on roads after finding it impossible to cope with the stress of making their trips. A Civil Servant, Mr Innocent Edewor, residing in Iyana-Ipaja and working in Iganmu lamented that latest fuel scarcity worse than the previous ones, saying "the situation is telling on my meagre income". "It is never easy coping with Lagos traffic but the last one week has been hellish. "I cannot even drop my children in school because first the fuel is not available and secondly the roads are heavily congested by heavy vehicles.

"I have, therefore, decided to let my children stay at home, until the situation gets better. "I pay as much as N350 from Iyana-Ipaja to this place and most of the time I have to trek long distances. If I have my way, this is the time to leave Lagos," the apparently frustrated worker stated. In a related development, traders on Lagos Island are lamenting poor sales because of the inability of people to get to the island.

"Nobody is coming to patronize us at Balogun Market. Which road will they take to come to the market," a shop owner, Mrs Olubunmi Erinle, said. "Our leaders should be proactive to prevent situations like this because everyone is suffering. The hardship is too much," she said.


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