The Nation Newspaper

Category: Energy

  • ‘Mergers, acquisitions coming to downstream oil sector’

    Marketers should embrace mergers and acquisitions in the downstream oil sector to consolidate their operations the Chief Executive Officer, Enyo Retail and Supply Limited, Mr. Abayomi Awobokun, has said.

    He said this will boost their capacity to supply fuel effortlessly across the country by 2024,

    Major Oil Marketers Association of Nigeria (MOMAN), Independent Petroleum Marketers Association of Nigeria (IPMAN) and Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN), are the key operators of the oil marketing and distribution segment of the oil industry.

    Awobokun said the downstream subsector would experience mergers and acquisitions, which would bring about changes in its operation in the next five years. While explaining past and current developments in the subsector and projecting into its future, he said, mergers and acquisitions are inevitable in view of the conditions of operators in the sector.

    Awobokun stated this in during a press onference  in Lagos to intimate the public about the operation of Enyo Retail and Supply Limited.

    According to him, the development became necessary in order to bring out the essential changes in the downstream operation, which has for years been plagued with problems such as infrastructure, logistics and others.

    Awobokun said: “The next five years would witness new players in the downstream subsector of the Nigerian oil and gas industry. People would see new but bigger players and Enyo Retail and Supply Limited is one of them. The subsector would experience mergers and acquisitions in the next five years.

    Enyo Retail and Supply Limited, he said, has acquired new retail solutions as part of its expansion plans, adding that the firm would not stop at that.

    “We are entering into a contractual agreement with key dealers across the country with a view to fast-tracking rapid expansion of stations. We believe that the idea of having stations at strategic locations will help us drive our commitment to the provision of quality petroleum products in the country,” he added.

    Besides, he said Enyo would be providing technology-driven services to its customers, adding that the firm has concluded plans to set the pace for the innovation in fuel retailing.  He also said the company has a way of interfacing with their customers seeking redress by ensuring that customers lodge their complaints about the products offered to them.

    Enyo, Awobokun said, carries out thorough investigations upon acquiring fuel stations for improved growth.

    The firm, he said, finds out the topography of the area (s) where a vacant retail outlet is located in order to ascertain the strength of the structures erected there, find out whether the owner of the outlet obtained building permits/plans from the state government, whether the area (s) has commercial strength in order to ensure the marketability of the petroleum products, among meeting other requirements needed for the growth of the stations.

    However, MOMAN’s Executive Secretary, Mr. Clement Isong, refused to comment on the issue of mergers and acquisitions in the future among marketers, as he claimed that he was not aware of the issue.

    The Nigerian National Petroleum Corporation (NNPC) is planning to increase its retail fuel market to 30 per cent from 14 per cent by 2020. The goal, NNPC’s Group Managing Director, Dr Maikantu Baru, said would be achieved before the set date.

  • Traditional rulers seek autonomy for NDDC

    Traditional rulers under the aegis of the National Executive Council of Traditional Rulers of Oil Minerals Producing Communities of Nigeria (TROMPCON) has urged the Federal Government to allow the Niger Delta Development Commission (NDDC) to be independent and operate within the ambit of the Act establishing it.

    Oba Obafemi Ogbaro, the Odoka of Ogbaro kingdom in Ilaje Local Government Area of Ondo State, and National Secretary of TROMPCON, stated this while speaking with reporters.

    He felicitated with the new management of NDDC on the appointment of its new Acting Managing Director, Prof. Nelson Brambaifa; the new acting Executive Director of Finance and Administration, Mr Chris Amadi, and Mr. Adjogbe Samuel, acting Executive Director of Projects.

    Ogbaro while reaffirming the association’s support for the new board, challenged it to reposition the commission by ensuring proper monitoring and completion of all projects in the region.

    “We also appeal to the new board to ensure prompt payment to contractors who borrowed money to complete their projects.  The bottlenecks in mode of payment should be a thing of the past and stakeholders particularly the traditional rulers of the mandate areas, should be carried along,” he said.

    The TROMPCON scribe also lauded the transparent and commitment of the current board and management of NDDC, declaring the association’s support in partnering with the commission towards developing the Niger Delta region.

    Ogbaro said the association was impressed with the strategies adopted by the Commission’s Board. “There is a different spirit here that has increased the tempo of activities geared towards fast tracking regional development. We are excited by the practical approach of the new board and management and we are ready to cooperate with NDDC to do more for the people.

    “The commission is committed to doing things differently and the money contributed to the NDDC fund must be used in a responsible, transparent and efficient manner, and it starts from the budgetary process,” he said.

    Ogbaro said the new management has demonstrated good intention that they owed it to Nigerians, the people of the Niger Delta, stakeholders of the Niger Delta and the Federal Government to ensure true regional development, adding that the new spirit is a necessary foundation for progress.

  • NSE lauds NNPC for women engineers’ support

    The Nigerian Society of Engineers (NSE) has commended the Nigerian National Petroleum Corporation (NNPC) for its role in the advocacy of science and engineering-based education for the girl-child through support for the activities of the Association of Professional Women Engineers of Nigeria (APWEN).

    President Nigerian Society of Engineers (NSE), Adekunle Mokuolu, stated this in Abuja while receiving NNPC’s management led by the Corporation’s Group Managing Director, Dr Maikanti Baru, to the headquarters of the society.

    NNPC spokesman Mr. Ndu Ughamadu, said the NSE chief disclosed that by identifying with APWEN in its quest to engender a sound foundation for female engineering professionals in the country, the corporation was taking a step that would illuminate the nation’s engineering and technological landscape a few years from now.

    Mokuolu particularly commended the NNPC boss whom he described as a worthy first class ambassador of the engineering profession, saying Baru was not just a first class scholar but also a worthy administrator.

    Baru said the visit was part of the corporation’s strategic stakeholder engagement with professional bodies with which the corporation shares common goals of championing Nigeria’s march towards strengthening professionalism, capacity development, local content and industrialization.

    He noted that the NSE has over the years, continued to play a pivotal role in transforming engineering profession in Nigeria.

    The NNPC chief also said the Corporation would continue to identify with NSE’s resolve to groom professional engineers as well as promote and entrench engineering excellence in the country.

  • IPMAN fails to sell petrol at N140

    Members of Independent  Petroleum Marketers Association of Nigeria (IPMAN) has refused to comply with its leadership to sell petrol to customers at N140 per litre. The product currently sells for between N143 and N145 per litre.

    Its leadership had directed the oil marketers to sell the product at N40 per litre in the run up to the general elections.

    However, the Caretaker Chairman of IPMAN Western Zone, HRH Obafemi Ogbaro, has appealed to members to comply with the directive.

    He made the appeal after the chapter’s executives meeting in Lagos.

    Ogbaro said: “My attention has been drawn to a purported press statement credited to a marketer in Mosinmi depot who was a former vice chairman of IPMAN western zone denouncing the directive of our IPMAN National President, Elder Chinedu Okoronkwo, to our patriotic members to sell petrol to the general public at N140 per litre.”

    He said the association took the decision to ameliorate the suffering of the masses because of the rescheduled elections, adding that IPMAN members as a responsible association felt the pains Nigerians suffered for travelling to their various destinations to perform their civic duties of voting the candidates of their choice in the Presidential, National Assembly, Governorship and State Assembly elections which was rescheduled to  February 23, 2019 and  March 9, 2019 respectively.

    He said the group  shared in the pains of Nigerians hence  the sacrifice in this trying period to agree to a N5 per litre reduction. “This will eat into our members’ profit but we have to give back to the society as part of our Corporate Social Responsibility. The reduction in price commenced from Wednesday, February 20, 2019 to  March 11, 2019.

    The national president of IPMAN, Elder Chinedu Okoronkwo on February 17 directed its members nationwide to reduce petrol pump price from N145 per litre to N140.

    He had said: “The reduction will last till March 12 to help reduce transport fares for Nigerians as they travel to vote for their candidates for the presidential, National Assembly, governorship and House of Assembly elections. After that date, we will review the price.”

  • Shell inducts 30 graduates for internship

    Thirty engineering graduates have been inducted to the fifth batch of the Shell Nigeria internship programme, a four-year old scheme designed to help young graduate engineers upscale their skills in readiness for employment in the energy sector.

    The internship programme, run in collaboration with the Petroleum Technology Association of Nigeria (PETAN), places the interns with various Nigerian oil and gas service companies to gain industry experience for one year.

    Shell Petroleum Development Company (SPDC) Nigerian Content Manager, Mr. Olanrewaju Olawuyi, described the programme as a critical intervention in bridging the manpower gap in the industry and enhancing local capacity.

    Olawuyi, who spoke in Port Harcourt at the induction of the new interns and the graduation of 30 interns of the fourth batch of the programme, said: “Out of the 140 graduates so far trained through the programme, 65 per cent are now gainfully employed in the oil and gas industry. I am excited at the successful feat of the candidates, I encourage the incoming interns to make the best use of this unique opportunity.”

    President, PETAN, Mr. Bank Anthony Okoroafor said: “The objective of the programme is to give young graduates the opportunity to have one-year-on-the-job training in their respective disciplines thereby enhancing their employability. The success of the Shell/PETAN internship scheme has gone beyond the shores of Nigeria.”

    One of the beneficiaries, Miss. Ugonna Queen Ochuba, said: “The Shell/PETAN internship was my first on-the-job training opportunity. The internship did not just give me the opportunity to be hands-on but also helped to boost my skills and experience in my discipline.”

    The Nigerian Content Development and Monitoring Board (NCDMB) Manager Capacity Building, Mrs. Angela Okoro, commended the Shell/PETAN collaboration. She said: “This is one of the capacity development initiatives that the Board is replicating.”

    General Manager, Business and Government Relations of Shell Nigeria, Mr. Bashir Bello, said: “Every year, the Internship supports fresh graduate talent through exposure to rich technical on-the-job work experience to equip them with practical industry experience, which will then position them favorably for employment opportunities after the programme.”

    Shell/PETAN internship programme was conceived as part of the collaboration roadmaps to support efforts at closing identified gaps in the availability of competent manpower in critical disciplines like Geology and Engineering, in the oil and gas industry.

  • Will oil ever hit $100 again?

    We are again in the season of oil price unpredictability where oil prices easily rise and fall. This has made RIGZONE to ask experts whether oil will ever reach $100 per barrel.

    Oil will hit $100 per barrel again, according to RoseAnne Franco, head of oil and gas at global risk consultancy Verisk Maplecroft.

    “It’s a question of when and will it stay there … the level of geopolitical uncertainty we confront today is particularly volatile and precisely the type of conditions that could lead to an oil price shock,” Franco told Rigzone.

    “That said, the uncertainty appears to cut both ways as global economic growth, which supports higher oil demand, is vulnerable to heightened geopolitical risk, which erodes it,” Franco added.

    Read also: EFCC arraigns 19 for alleged illegal oil deal

    Fundamentals don’t appear to support such higher price levels this year, according to Franco. The Verisk Maplecroft representative stated however that “beyond 2020, an oil supply crunch due to the retrenchment in spending in the oil patch coupled with a perfect storm on the geopolitical end could easily trigger another price shock.”

    Offering his view, Devin Geoghegan, Genscape’s global director of petroleum intelligence, told Rigzone that “unless electric cars become the unicorn of demand growth deceleration, $100 oil seems highly likely at some point during the next 10 years.” The Genscape director added however that there are “very real headwinds” to reaching that figure again.

    “First, stagnant or declining demand could cause an abrupt shift lower in multi-year supply need expectations,” Geoghegan said.

  • Ibadan DisCo achieves 365 days safety milestone

    The Ibadan Electricity Distribution Company (IBEDC) said it has achieved a milestone of 365 days of zero Lost Time Injury (LTI) translating to 1.6 million safe man-hours.

    Lost Time Incident or Injury (LTI) is a measure of injury or incident that occurs on a job that is capable of preventing a worker from performing or continuing with his or her task resulting in downtime in the operation. It is an oil and gas industry benchmark that evaluates adherence to safety and environmental requirements during operations.

    The IBEDC in a statement by its Head, Branding and Corporate Communications, Mrs. Angela Olanrewaju, quoted the company’s Chief Technical Officer, Mr. Ade Ayileka, as saying the business had no time lost to injury with staff in 365 days.

    “This safety achievement is a big milestone in the power sector considering the level of risks involved in the day-to-day activities and the extent of free access to electrical installations.

    “The power sector by nature is fraught with high-level hazard and occupational risk. To achieve a year with no lost time Injury is definitely a milestone to recognise,” Ayileka said.

    He said the company was determined to put safety at the forefront of all its operations as its mission was to attain the vision zero incident by 2020.

    According to him, the major milestone was achieved due mainly to the emphasis placed on safety within IBEDC, which has formed part of its core strategic business goals consistently for over three years.

    Ayileka said this also included extensive customer education, sensitisation on safety and huge investment on safety gear and equipment for staff.

    “To ensure we continue to keep safety as a culture as we work toward the International Standard Certification, which specifies requirements for an Occupational Health and Safety (OH&S) Management System, Ibadan DisCo has obtained the services of an accredited environmental consultancy firm.

    He said the firm – AMPAK Nigeria Limited, was engaged for a health, safety and environment improvement programme.

    Ayileka said the firm would help IBEDC consolidate its existing safety structure and recommend new measures to attain the International Safety Standard Certification – ISO 45001-2018.

    He also appealed to customers to work in collaboration with IBEDC and its staff to attain this mission by not tampering with electrical installation, refrain from building any structure under power lines and assaulting its staff.

  • Axxela achieves IMS certifications

    Axxela Limited, a gas and power portfolio company, has successfully achieved a triple – implementation, evaluation, and certification of Integrated Management Systems: ISO 9001:2015, ISO 14001:2015, and ISO 45001:2018.

    The Standard Organisation of Nigeria (SON) said Axxela is the first  company  in the Nigerian oil & gas space to hold all three certifications simultaneously, underscoring its longstanding commitment to Environmental, Health, Safety and Quality (EHSQ) management.

    An Integrated Management System (IMS) collates all of an organisation’s systems and processes into one holistic framework, enabling it function as a single unit with streamlined objectives.

    Speaking on the issue, Axxela Chief Executive Officer, Bolaji Osunsanya, said: “We constantly strive to apply global best practices across all facets of our enterprise to maintain a high standard of quality, occupational health and protection of the environment. My commendations go out to the Axxela team for continually pushing the envelope, and as we advance economic empowerment and industrialisation across the region, these integrated certifications are testament to our collective efficacy as an organisation.”

    Axxela’s EHSQ Manager, Uche Okpala, also said: “We actively engage SON, the frontline certification body and Nigerian representative of the International Organisation for Standardisation (ISO), to provide objective assessments of our management systems. Since 2009, our Quality Management System was certified in accordance with the requirements of ISO 9001:2008. This heralded subsequent efforts to consolidate this achievement with certifications in Environmental Management System (ISO 14001:2004) and Occupational Health & Safety (ISO 45001:2018). In keeping with the maintenance requirements of these standards, we have always maintained our certifications to the latest revisions, culminating in our most recent implementation, transition and certification across the three Integrated Management Systems.”

  • Why Russia, Nigeria collaborate on nuclear energy

    Russian and Nigerian Government collaborated to build nuclear energy in Nigeria in order to help the country reduce power outages, improve industrial capacity and further grow its Gross Domestic Product (GDP), ROSATOM Central and Southern Africa Chief Executive officer, Dimitry Shornikov, has said.

    ROSATOM is Russian Government-owned nuclear energy firm, and it specialises in the production and generation of nuclear electricity for countries in Europe and others.

    In an interview with The Nation in Lagos, Shornikov said Nigeria’s power is one of the poorest in Africa, adding that the two power sources namely gas and hydro are unable to produce electricity megawatts, the country requires for growth.  According to him, a lot of misconceptions surround the production of nuclear energy, noting that it has been proved over time that nuclear energy is the safest of all energies produced globally.

    Nuclear energy, Shornikov said, is highly regulated and controlled, a development, which left credence to the fact that it is well managed and not prone to dangers contrary to the notions held by many Nigerians.

    He said the two forms of electricity are not affordable, adding that the development informed the decision by ROSATOM to partner with the Federal Government on how it can provide nuclear electricity in the country.

    Shornikov said: “When compared to the production of hydro and gas electricity with that of nuclear energy, they are expensive and unreliable. These problems are not present in nuclear energy.”

    He said it would be difficult to provide the cost of producing nuclear energy in Nigeria because sizes and configurations of the nuclear plants are not the same. This is not like gas turbine that is manufactured to generate a particular number of megawatts (Mw) of electricity.

    “There are lots of variables that need to be considered in the process of configuring nuclear energy plants. The variables are in relation to the size of the plant, the volume of energy the plant would produce,” he added.

    He said though the cost of producing nuclear may be prohibitive, its benefits outweigh the cost because it is environmental friendly, reliable and regular.

    Shornikov said: “The negotiations for the establishment of science and nuclear energy centre between Nigeria and Russia has reached an advance stage. The two parties are working together on how to proceed on the issue of establishing the centre in Nigeria.

    “On safety issues, one of the misconceptions associated with nuclear energy is lack of safety. My aim is to compare it with air travelling. Most people see air travelling as the most dangerous. However, it is the safest in the world. It is the most regulated and controlled sources of energy. There is the need to educate stakeholders on the importance of nuclear energy, brief them that it is the safest.

    “On cooperation with Nigerian Government, it started in 2009 but it is in 2017 that we signed an agreement on it, which set the tone for further discussion on production of nuclear energy and its plants.

    “Electricity stability and regularity is a big issue in Nigeria. There are concerns. There are power outages, which affect the country’s GDP. One source of energy that is available is nuclear energy. It is environmentally friendly compared to gas power.

    “When we talk about cost of generating nuclear energy, obviously it is high because there are variables that need to be considered. These variables lie in the configuration of the plant. On the issue of cost, it depends on the configuration of the size of the plant and the volume of nuclear energy expected to be generated.”

  • Nigeria loses billions of dollars to prolonged bid rounds

    BILLIONS of dollars have been lost due to government’s inability to conduct bid rounds for major and marginal oil fields, former co-founder and Executive Director, Pillar Oil Limited, Seye Fadahunsi, has said.

    Fadahunsi could, however, not give a specific figure, but he maintained that the figures run into billions of dollars. “This is what the country could have been able to add to the economy over the last 12 years, especially from proper licensing rounds of blocks that are fallow,” he said.

    He explained that blocks are amass of fields.  “Imagine what the country could do with that, that’s why companies like Proton, Seplat, and the ND Western now have blocks, producing about 90,000, 70,000, 50,000 barrels per day respectively. It’s a substantial production and a major addition to the economy,” he said, adding: “They were only able to do that because there were assets available for them to bid and win.”

    “Some of them are producing about 300million standard cubic feet of gas a day, that’s a lot. Imagine what that could do to the power sector and to the industries,” he said.

    The last marginal field bid round was in 2003 while the last bid round for blocks was in 2007. Fadahunsi said it was too long, noting that if some people are not given the opportunity, they wouldn’t be where they are today.

    “It should be open and done regularly. There should be a bid round every three years because you need the bid round to increase your capacity. For those who have proven themselves, they need to be able to grow by acquiring additional fields and the new ones need to be led into the industry. Keep in mind that oil could finish one day, it’s a limited resource and one day it would finish,” he said.

    Marginal fields are located onshore and in the shallow waters. Statistics show that there are about 200 marginal oil fields in Nigeria. In 2003, the government awarded 24 out of these. Currently statistics show that nine out of these 24 are productive while the others are under-utilised.

    Consequently, reports show that the marginal fields only contribute a minimal 2.1 per cent to the total crude oil production and 67 per cent of marginal fields allocated in the 2003 licensing round have not produced a single barrel of oil.

    Marginal fields are oil fields that have been discovered by major international oil companies (IOCs) in Nigeria in the course of exploring for larger acreages and which have not been developed for more than 10 years. When identified, the IOCs may decide to farm out this field to another company to exploit as a sole risk venture. This means the contractor would bear all the costs and risks of exploitation and earn the entire rewards from exploitation.

    The President, by the provisions of the Petroleum (Amendment) Act of 1996 also has the power to declare a field as a marginal field where a discovery has been made in such a field, but has been left unattended to for 10 years. The major reasons for awarding marginal fields are to create new and diverse investment and boost reserves.

    According to the Nigerian National Petroleum Corporation (NNPC), Nigeria has about 200 oil fields branded as marginal due to location and distance to existing facilities and low ranking in the investment portfolio.

    Industry analysts argued lack of funding leads to underutilisation of leases and government’s inaction in conducting bid rounds is holding back investments in Nigeria’s 200 marginal fields, which many industry analysts say could speed up the country’s drive to increase crude oil production and revenue.

    Fadahunsi explained that another implication of not having another bid round was that people, who have the skills would not have the opportunity to deploy those skills, adding that it has a ripple effect on employment.

    According to him, each of the service companies could employ up to 60 people and when added up all, would come up to a large ecosystem of employment. Also, if these fields are put into production, they will increase Nigeria’s production capacity. “If about 20 of them come on stream and are doing about 3000 to 4000 barrels daily, that gives almost 70,000 barrels per day. It contributes to the economy, and keeps people employed,” he said, adding that not having another bid round is not to anybody’s benefit.