The Nation Newspaper

Category: Energy

  • Shell eyes 0.2% methane emissions intensity reduction by 2025

    Royal Dutch Shell Plc said it has set a target to maintain methane emissions intensity below 0.2 per cent by 2025. This target covers all oil and gas assets for which Shell is the operator.

    “This methane target complements Shell’s ambition to cut the Net Carbon Footprint of our energy products by around half by 2050, which we announced in November 2017,” said Mr. Maarten Wetselaar, Shell’s Integrated Gas & New Energies Director.

    “It is a further demonstration of our continued focus on tackling greenhouse gas emissions. Such efforts are a critical part of Shell’s strategy to thrive during the global energy transition by providing more and cleaner energy,” Wetselaar said.

    To maintain this methane target, Shell is implementing programmes including using infrared cameras to scan for methane emissions, deploying advanced technology to repair leaks, and replacing high-bleed pneumatically-operated controllers with low emission alternatives.

    Shell recognises that there remains uncertainty with measuring methane emissions. “This is an industry wide issue and we need to fix this fast,” said Wetselaar. “We must get a much more accurate understanding of how much we are emitting.”

    The target for methane – which has a higher impact on global warming than carbon dioxide when released into the atmosphere – will be measured against a baseline Shell leak rate, which is estimated to range from 0.01 per cent to 0.8 per cent across the company’s oil and gas assets.

    “Methane is a potent greenhouse gas, but it has a relatively short lifetime in the atmosphere. That means reducing methane emissions brings immediate climate benefits, buying some time while we work out longer term solutions,” said Mark Radka, Head of UN Environment’s Energy and Climate Branch. “This commitment by Shell is encouraging in itself but also because of the signals it sends to the rest of the industry.”

    Shell is involved in a broad range of initiatives focused on reducing the emissions intensity of methane throughout the full supply chain – from production to the final consumer. For example, in 2017, Shell brought together industry, international institutions, non-governmental organisations and academics to develop a set of Methane Guiding Principles, which focus on continually working to reduce emissions of methane throughout the gas industry and have now been signed by 16 companies.

    Shell has been an active member of the World Bank-sponsored Global Gas Flaring Reduction partnership since 2002. As part of the partnership, the World Bank has developed the Zero Routine Flaring by 2030 initiative, which Shell signed in 2015. This encourages governments, companies and development organisations to work together to end flaring.

  • MAPs: Offer investors, manufacturers 5% interest rate, says MMAN

    The Federal Government should open up a lending window through which investors in the new metering plans would borrow money, the Meter Manufacturers Association of Nigeria (MMAN), Executive Secretary, Mr. Muhideen Ibrahim, has said.

    He said the new metering regulation ensures that investments have a life span of between 10 years and 15 years.

    In a phone interview with The Nation, he said the new metering plan, which gave birth to the introduction of Meter Asset Providers (MAPs), requires huge funds, adding that the government could assist by giving investors or meter manufacturers a single- digit loan of five per cent.

    Ibrahim said: “There should be government’s intervention of about five per cent or less interest rate to the manufacturers of meters. Through this, the manufacturers would be able to access funds from the banks for the growth of their businesses. Without intervention from the government, metering would be a challenging task.”

    He said MAPs have been meeting with power distribution companies’ (DisCos) on how to meter consumers, adding that they have mapped out strategies on how to achieve the goal.

    According to him, banks (local and foreign) were not giving credit to producers of meters because they do not have the capacity to pay back.

    “But if the government through the Central Bank of Nigeria(CBN) can compel financial institutions to give loans at five per cent interest rate to investors in metering areas, the better for the growth of the sub-sector. Also, the African Development Bank and others should be made to join the investment profile in order to guarantee long term stability,” he added.

    The credit worthiness, Ibrahim said, of meter asset providers, is key to their ability to stay in business. He said when providers of meters demonstrate enough capabilities in the sub-sector, providing meters to the consumers and putting an end to estimated billing would not be a problem.

    On gains of MAPs, he said the idea would enable consumers to access meters for growth, while at the same time, save themselves from embarrassment from officials of the power firms that disconnect customers light unnecessarily.

  • NLNG: Train 7 will push gas production to 30mtpa

    The Nigeria Liquefied and Natural Gas Limited (NLNG) is expected to produce 30 metric tonnes per annum (MTPA) on completion of its Train 7, its former Managing Director, .Godswill Ihetu, has said.

    Train is a vehicle through which the gas giant exports Liquefied Natural Gas (LNG) to developed countries, such as China and Asia.

    He said when Train 7 is completed, Nigeria would improve its Gross Domestic Product (GDP), increase its foreign exchange earnings, make our revenue through taxes and create more employment, among others.

    Ihetu said NLNG has completed Train 1, 2, 3, 4 5 and 6. It has also generated revenue of over N10 billion for the government, adding that the cash would increase substantially, when Train 7 takes off.

    Ihetu said: “NLNG capacity will increase from 22 to 30 metric tonnes per annum, when Train 7 is completed. NLNG has made considerable investment in building the trains and further increase exportation of gas for the growth of the economy. The intentions for building the trains are laudable and the results will impact positively on the economy. Besides improvement in gas exports, various efforts made by NLNG and its partners, including the Nigerian National Petroleum Corporation (NNPC), Total, Eni and Shell in producing gas, would lead to the growth of the domestic economy.

    “The power plants, petrochemical firms and others are using gas for production, which has a multiplier effect on the economy. Gas processing and export is good business and Nigeria would not find it difficult to recoup its investments on such activities as local and international organisations use the product for growth.’’

    Foreign direct investments (FDIs), Ihetu said, have been created to speed up the process of building the Trains by NLNG and further galvanise the economy.

    He said various Trains built by NLNG provide immense benefits for the government, urging the firm to continue to create opportunities that would enable local and international companies get added value through gas.

    On funding, he said NLNG has overcome its problem of raising money for the take-off of various Trains, stressing that Federal Government through NLNG could access funds through various windows.

    He said foreign lenders have confidence in NLNG, which gives it access to borrow money for big-ticket transactions and pay back. He said foreign financial institutions enjoy working with the firm.

    He said infrastructure is a problem facing operators in the gas value chain, adding that NLNG, which is a major stakeholder in the gas value chain, is working to solve the problem by venturing into projects that would provide money for such purpose.

  • Oil demand may peak by 2023

    Within 20 years, oil use will have long since peaked, renewables and natural gas will account for about half of energy supply and the cost of keeping the lights on will plummet. But that still won’t be enough to meet climate goals, according to a forecast from energy and maritime services company DNV GL Group AS.

    According to Bloomberg, even with crude oil demand expected to fall from 2023 and total energy consumption over the globe to peak 12 years after that, the world will probably warm 2.6 degrees Celsius, DNV said. That’s 0.6 degrees above the level a consensus of scientists say the world will need to stay beneath to avoid catastrophic climate change, which could impact the Earth’s habitability.

    To achieve climate targets, regional and national governments would need to implement programs that make greenhouse gas pollution more expensive, among other measures. That would improve the profitability of ventures, such as carbon capture and storage and hasten the uptake of renewables, DNV GL Chief Executive Officer RemiEriksen said in a phone interview.

    “Even with this rapid transition with quite a rapid pace, some would say, it’s not enough,” Erikson said from the company’s headquarters in Hovik, Norway, so more is needed.”

    It’s not all bleak. The electrification of the energy system is happening faster than DNV previously forecast. Power use is set to more than double by the middle of the century, meeting 45 per cent of global energy demand. Most of that power will be generated by wind and solar energy, where technological advances are rapidly reducing installation costs.

  • EkoDisCo to add 20Mw to VI, Lekki, others

    Eko Electricity Distribution Company (EKEDC) is to add 20 megawatts (Mw) of electricity to boost supply to residents of Oniru, Maroko and Lekki environs. its General Manager, Communications, Mr Godwin Idemudia, has said.

    He said  the company has started a power project development within its network aimed at improving power supply. He said with the introduction of new power cables at the Maroko injection substation and construction of a new power line, customers in that area would enjoy uninterrupted power supply.

    Idemudia said the Maroko Injection Substation supplies Maroko, Ajose Adeogun and Oniru environs, saying that the replacement of these cables and installation of new power lines will not only improve power supply in these areas, but will also enable the company to extend the substations reach towards the Lekki axis, thereby improving power supply in the area.

    He said EkoDisco has invested over N655 million on these projects and over N200 million spent  to replace old power cables, while over N455 million was also spent to construct a new power lines.

    “Construction of the new power lines started in April 2018 and this would also improve power supply with an additional 20 megawatts,” he said.

    The EKEDC spokesman said the project’s take off was slightly delayed due to importation constraints on the main power cables needed for completion. He said the power cables had been cleared at the Lagos Port and that the project would be completed within a month.

    Idemudia said since the old cables had been replaced, the company had not recorded any faults, adding that it has also increased the power supply in these areas to 20 hours daily which the company aims to increase to 24 hours depending on energy supply from the grid.

    He, however, pleaded with customers to bear with the company and cooperate with its officials during this rehabilitation. “I com-mended our esteemed customers for their continued support and urge them to fulfill their obligations by paying their bills on time.

    “As it will help the company provide better services as more investments will be injected into the network for the improvement of power supply to our customers under EKEDC network, ‘’ the statement said.

  • PENGASSAN, NUPENG to collaborate with NCDMB on local content

    The national executives of the Petroleum and the Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and their counterparts – Nigerian Union of Petroleum and Natural Gas Workers (NUPENG) – have pledged to collaborate with the Nigerian Content Development and Monitoring Board (NCDMB) on local content development in the oil and gas industry.

    The unions made the commitment during a visit to the NCDMB headquarters in Yenagoa, the Bayelsa State capital.

    PENGASSAN National Chairman  Comrade Francis Johnson commended the Board’s effort to the growth and development of the oil sector by encouraging indigenous participation.

    He said: “This engagement with the Board is quite revealing. We have learnt a lot about the laudable interventions of NCDMB. There is no better time to work with the Board. We are committed to work with you.”

    Johnson urged the Board  to prevent portfolio firms from grabbing the contracts, which would help to build and deepen the Nigerian content in the sector.

    On the Board’s headquarters construction, the PENGASSAN chief described the project as laudable. He said: “On behalf of PENGASSAN/NUPENG, I want to commend NCDMB for this project and I hope it will be completed soonest as we will be here to be a part of the official commissioning.”

    The Board’s Executive Secretary, Simbi Wabote, denied that the Board awards contracts. He reiterated that the NOGICD Act 2010 mandates the Board to review and approve the Nigerian Content plan and issue compliance certificates to  firms adhering to the Law.

    “Contrary to the widespread belief that NCDMB awards contracts, let me categorically say the Board is mandated to review, assess and approve Nigerian Content plans developed by operators.  We issue certificate of authorisation for projects that comply with Nigerian Content provisions,” Wabote said.

    Wabote highlighted the structure and operations of the Board and how both unions could enhance local content. He explained that the Nigerian Content is not about Nigerianisation but rather domestication and domiciliation of value-adding activities in-country.

    He said the Board’s efforts since the enactment of the Act had yielded tangible benefits, citing establishment and upgrade of fabrication yards, pipe coating plants, upstream production managed by indigenous companies, production of low/high voltage cables and partial integration of Egina floating production, storage and offloading vessel (FPSO), as some of them.

    The NCDMB boss said the major challenges of the Board include infrastructure for the movement of materials, inter-agency collaboration, policy consistency and attraction of investors to set-up manufacturing outfit locally.

    Wabote called for the Unions’ support for the Board. He disclosed  the agency’s readiness to collaborate with the union.

    NUPENG Chairman Comrade Williams Akporeha said their collaboration with the Board would be total. He noted that they were happy with the Board’s achievemnets. He, however, suggested that NCDMB  woud introduce periodic consultative forum with the unions to boost Nigerian content practice.

    Akporeha said the Board has a major role to play to ensure smooth operations in the oil and gas industry and advised that NCDMB examine international practices on remunerations to employees

  • Kachikwu for Nairobi summit

    The Minister of State for Petroleum Resources, Dr Ibe Kachikwu, will join operators to address energy infrastructure deficiency in sub-Saharan Africa at the Africa Oil and Gas Summit in Nairobi, Kenya from October 10-12.

    The summit’s co-convener, Mr Oladeji Olawale, told reporters in Lagos that going by the United Nations projection, Africa’s population would hit 2.3 billion by 2050 while International Monetary Fund’s (IMF’s) projects that the continent will average 6.5 per cent Gross Domestic Product (GDP) growth by the same period, Africa has a lot to do to achieve economic prosperity and energy sufficiency.

    He noted that Africa holds about eight per cent of world’s proven oil and gas reserves with more new discoveries being made.

    According to him, population growth comes with increase in demand for energy and despite Africa’s adequate energy reserves. There is no infrastructure to these reserves to meet its energy needs. If urgent steps are not taken to address the problem, the energy deficit will get worse.

    It is in view of these challenges that the Sub-Sahara African Oil, Gas and Energy Summit (SSAOGES 2018)  will   enable stakeholders find solutions to the issues.

    Olawale said finance institutions, such as Afrexim, among others, would attend the event to meet with investors to discuss on energy infrastructure provision. He said there would speakers from power generating, distribution and renewable energy companies as well as oil and gas firms  from US, Germany, Britain, Russia and African countries, among others.

    The goal of the summit is to fashion out efficient ways to begin to develop the needed energy infrastructure for the future, he added.

  • ‘Nigeria will achieve nuclear energy goal by 2025’

    Nigeria will achieve its  nuclear energy goal and further improve its electricity supply by 2025, Rosatom’s Chief Executive Officer, Central and Southern Africa, Dmitry Shornikov, has said.

    Rosatom is a Russian-based energy firm with investments in production of nuclear energy in the country and other parts of the world.

    He said Nigeria has begun its energy diversification programme by generating electricity from off-grid and on-grid sources. Shornikov added that the country struck a deal with Rosatom to have its nuclear energy plant in Kogi and Akwa Ibom states.

    In a statement made available to The Nation, Shornikov said the firm had a meeting with stakeholders in the Nigerian electricity sector in Russia some months ago, adding  that efforts were ongoing to produce nuclear energy in Nigeria.

    He said nuclear would help Nigeria to bridge the power gap and improve its supply.

    Citing a World Bank report, Shornikov said Nigeria has the largest access to power deficit in sub-Saharan Africa and the second largest in the world, after India. The national electrification rate is 55 per cent and the rural electrification rate is only 39 per cent.

    He said: “Nigeria is planning to have power plants in some states in the federation. This would help the country to deal with its energy deficit. The Nigerian government in 2007 approved a technical framework for a nuclear power programme seeking the support of the IAEA to develop plans for up to 4000megawatts (Mw) of nuclear capacity by 2025.’’

    He said South Africa has built its nuclear energy plant, adding that Nigeria would soon join the former apartheid nation to have nuclear energy.

    He added that Kenya, Zambia Uganda and Ghana have shown interest in producing nuclear power to improve electricity generation.

    “In the event that Nigeria, Ghana, Uganda and Zambia build plants to produce nuclear energy, in addition  to South Africa, which already has its own plant, the march towards making Africa a hub for nuclear energy is on course,” he added.

    South Africa, Dhornikov said, has an operational commercial nuclear power plant (NPP), while Egypt is making a record-breaking deal with the Russian nuclear corporation, Rosatom, for the construction of its maiden nuclear power plant in El Dabaa. The first unit of the NPP is set to be inaugurated in 2026.

    It would be recalled that the Minister for Power, Works and Housing, Babatude Fashola, has advocated the inclusion of nuclear energy in Nigeria’s energy plans.

    He said at a forum in Abuja that it was imperative for Nigeria to  emphasise the gains and safety of nuclear energy as obtained in other advanced nations, stressing that the development would help Nigeria to achieve a sustainable economic programme.

  • Mining: Firm challenges govt on port facilities

    The Chief Executive Officer, Symbol Mining, Tim Wither, has said port facilities are affecting the mining sector’s development. He advised the government to improve them.

    He said the speed with which products could pass through the port had great impact on the economic viability and companies’ ability to develop projects.

    He said with the Free Trade Zones (FTZ) and other infrastructure upgrades within the Lagos ports, there was optimism that these improvements would have a great impact in developing the resource industry.

    Wither spoke with The Nation on the forthcoming Nigeria Mining Week scheduled to take place in October in Abuja. He said because the industry as in its infancy, a lot of the technical skills are sourced from outside the country, particularly mining engineers and exploration geologists.

    He, however, expressed the commitment of the company to grow these capabilities in-house by training and educating people from the local communities. This, he noted, would support the aggressive exploration and growth strategies and help expand the industry.

    Symbol mining, he said, is an Australian publicly listed company, which started mining recently at the high-grade zinc and lead Imperial Joint Venture project in Bauchi State. The company, according to him, has been working in Nigeria since 2012, and brings international technical, marketing and financial expertise for the commercialisation of the mining and exploration projects.

    The company, he said, has two local joint venture projects, Tawny in Nasarawa State and Imperial in Bauchi State, with total tenements spanning over 500km. According to him, in the last six years, the company has completed over 12,000m of exploration drilling and released a maiden Joint Ore Reserves Committee (JORC) compliant Resource of 132,700t at 18.3per cent Zn (zinc) and 2.1per cent Pb (lead) for the Macy Deposit located at the Imperial project.

    ‘’Our maiden resource demonstrated a mineralisation zone of high-grade zinc and lead. The subsequent completion of the Macy Deposit scoping study confirmed the economic viability for high-grade direct shipment ore (DSO) to both Chinese and European smelters. The firm’s marketing plan is to develop a high-quality product brand, selling directly to smelters through established offtake partnerships,’’ he assured.

    The company’s strategy is to generate early cashflow from open pit mining at the Macy Deposit, which will facilitate further exploration activities at Imperial and Tawny, and potentially expand our resource base to grow the Company. Central to our future success, is the support of the local community and development of a skilled workforce. Our core values include respect and acceptance from the local communities in which we operate, and this is only achieved by open and honest conversations.

    ‘’We communicate information on the project and listen to any challenges faced by the community. We are also focused on building a skilled local workforce and creating a framework for them to develop and learn a range of skills in a controlled and supportive environment, we would like to be the employer of choice for the mining industry in Nigeria,’’ he added.

    In the next five years, we will spend a considerable amount of efforts in training and up-skilling our team, so they can then manage and grow our future projects, this will in turn benefit the mining community.

    ‘’We want local communities to benefit from the growth of the mining industry. One of the strongest principles within the Nigerian Mining Code is the mandatory Community Development Agreement (CDA), something which other more established mining jurisdictions,‘’ he said

  • Forex scarcity: Marketers bicker over kerosene import

    Fuel marketers are finding it difficult to import Dual Purpose Kerosene (DPK), two years after the Federal Government removed subsidy on the product.

    The marketers, which include members of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Depot and Petroleum Products Marketers Association (DAPPMAN), said they stayed away from the importation because of the outstanding subsidy arrears being owed by the government.

    The marketers said the issue was borne out of scarcity of foreign exchange (forex), adding that access to forex has been diificult.

    They said it was becoming impossible to meet the demands of the consumers who use the product for cooking.

    IPMAN’s National Operations Controller, Mr. Mike Osatuyi, said members of the association were not importing DPK, but insisted that the DPK market should be fully deregulated.

    According to him, any IPMAN member could bring in DPK after getting the approvals from the Department of Petroleum Resources (DPR) and the Petroleum Products Pricing Regulatory Agency (PPPRA).

    Osatuyi said: “We will start importing DPK when the coast is clear. By this, I mean when we are through with our internal reorganisation. But I must say the demand for the product is dropping as people are switching over to Liquefied Petroleum Gas (LPG).”Because we believe the market is fully deregulated, I don’t think we will have any issue with foreign exchange when it is time to import.”

    According to him, the landing cost of fuel imported into the country has increased relative to rise in the price of crude oil in the international market, adding that many marketers could not get enough to buy the product from the refiners abroad.

    Also, DAPPMAN’s Executive Secretary, Mr. Femi Adewole, said operators in the downstream sub-sector were worst hit, as they grapple with funds shortage.

    He said marketers were unable to get enough foreign exchange for importation of fuel, especially kerosene.

    He said failure of the marketers to access funds from banks coupled  and the government’s inability to pay their subsidies made it difficult for them to import kerosene.

    It would be recalled that the Nigerian National Petroleum Corporation (NNPC), the only approved firm to import fuel, sells DPK to marketers at an ex-depot price of N190 per litre. This implies that marketers would pay more because of landing cost, if they are to import.

    By this,  a near monopoly of the product has been created by the national oil company, a development, which has further compounded the problems of many Nigerians that use kerosene, which is the most commonly used fuel in the country.

    The issue has left many household users to pay as much as N350 per litre to get the product for use.