The Nation Newspaper

Category: Energy

  • Oil theft increased in 2017, says Shell

    Crude oil theft from the pipeline network of Shell Petroleum Development Company Limited (SPDC) increased   from about 6,000 barrels per day (bpd) in 2016 to 9,000 barrels per day last year, the oil giant has said.

    According to a document, which focused on security, theft, sabotage and spills, made available to The Nation, Shell said: “Crude oil theft on the pipeline network resulted in a loss of about 9000 bpd in 2017, which is more than the approximate 6,000 bpd in 2016, but less than 25,000 bpd in 2015.

    “The number of sabotage-related spills in 2017 increased to 62 compared to 48 in 2016 but less than 94 in 2015. The increase in 2017 can in part be explained by the militant-induced shutdown of the Forcados export terminal in 2016, which reduced opportunities for their party interference.

    “This demonstrates that continued air and ground surveillance and action by government security forces to prevent crude oil theft remain necessary. Since 2012, SPDC has removed more than 950 illegal theft points.”

    “Shell refers oil spills caused by crude oil theft and sabotage of facilities as third party interference, as well as illegal refining, which cause most of the environmental damage from oil and gas operations in the Niger Delta. But the company noted that irrespective of the cause of, it cleans up and remediates areas affected by spills originating from its facilities in conjunction with its joint venture partners. It stated that sometimes the spills are made worse where there are access challenges to the incident sites to investigate and stop leaks.”

    The oil gaint said its key priority  remained to ensure that oil spills from its operations did not occur. It said: ‘’No spill is acceptable and we work hard to prevent them. Shell companies in Nigeria operate under the same standards as all other Shell-operated ventures globally. Regrettably, in addition to spills caused by criminal activity, there were nine operational spills of more than 100 kilograms in volume from Shell Companies in Nigeria facilities during 2017, three of which were from pipelines/flowlines infrastructure, which is lowest in recent years.

    “This number is one more than the eight spills in 2016. In 2017, the total volume of oil spilled from operational incidents was approximately 0.1 thousand tonnes, a reduction of approximately 70 per cent on the 2016 figure.

    “The volume reduction and fewer spills from pipelines/flowlines can be attributed to continued progress on preventing operational spills such as preventive maintenance of pipelines and routine inspections.

    “To reduce the number of operational spills, the SPDC JV is focused on implementing its ongoing work programme to appraise, maintain and replace key sections of pipelines and flowlines. One hundred and eighty-eight kilometres and 40 km of flowlines and pipelines replaced over the last six years to approximately 1,230km.

    “SPDC continues to undertake initiatives to prevent and minimise spills caused by theft and sabotage of its facilities in the Niger Delta.”

  • NIPCO steps up awareness on LPG

    NIPCO Plc has stepped up its campaign to create awareness on the benefits of switching to gas to reduce environmental impact.

    The company also presented LPG gas accessories to the best school at a special event organised by the Federal Ministry of Environment (FME) to mark World Environment Day (WED), to further create awareness on LPG use.

    The event, which held at the Games Village of the ministry’s Lagos liaison office, featured three  competitions tailored around reduction of pollution in our environment.

    The forum provided an avenue for the firm to promote safe use of LPG as cooking fuel, and ensuring that schools and other users switch to gas as a preferred fuel for households.

    In a goodwill message, NIPCO’s Managing Director, Sanjay Teotia, said supporting the  yearly celebration is key to the company’s efforts at promoting  safe and habitable environment.

    Teotia, represented by Head LPG Operations, Kamal Badmus, said  many initiatives were being put in place by the company to encourage  cooking gas use.

    He noted that aside from the inherent benefits of gas over other cooking fuels, such as kerosene, NIPCO has also prepared safety pamphlets to address some safety issues being raised on LPG use.

    According to him, the safety tips addressed some of the misconceptions about gas, which had scared users, especially from handling of accessories such as cylinders and burners.

    The ministry’s Federal Controller in Lagos, Mrs. Oluwatoyin Agbenla, said the theme of the event, “Beat plastic pollution’’ was to draw the attention of stakehold-ers to the need to beat the unending pollution caused by inappropriate disposal of plastic materials.

    She said the presentation of gas accessories to the best school in the completion is noteworthy.

    Maidic Schools, Alagbado in Alimosho Local Government was adjudged the overall best school in the competition and was presented with set of LPG accessories, including 12.5kg cylinder, multiple gas burner and regulator by the company’s representative.

  • Nigeria: Barkindo, Kachikwu, Adebutu, others for Oil & Gas Summit

    How can Nigeria Oil and Gas industry be effectively harnessed towards national economic development and individual prosperity?
    This has however informed a four-day
    Nigerian Oil and Gas Conference and Exhibition starting on Monday, 2nd to Thursday 5th of July in Abuja with the theme; Driving Nigeria’s Oil & Gas Industry Towards Sustained Economic Development and Growth.
    The Chairman and Chief Executive Officer of the Petrolex group, Segun Adebutu will speak on the sub-theme; Harnessing the Opportunities in Nigeria’s Downstream Sector at the forum which will have over 700 industry professionals, including key stakeholders from both the public and private sectors in attendance.
    Expected dignitaries include the Secretary-General of OPEC; Dr. Sanusi Barkindo, honourable Minister of Petroleum Resources; Dr. Ibe Kachikwu, and the Group Managing Director of the NNPC, Dr. Maikantu Baru.
    The forum for International Conference Centre (ICC), Abuja, has been described as a viable avenue for networking, sharing ideas, and exploring new opportunities and innovations in the industry.
    According to the CEO of Petrolex, Segun Adebutu, the company is a Gold sponsor featuring the annual NOG Awards Ceremony on July 25 will be co-hosted.
    “As an integrated energy company, Petrolex remains committed to redefining Africa’s energy landscape and providing innovative energy solutions. We are glad to showcase this at the 17th Nigerian Oil and Gas Conference and Exhibition. We also look forward to interacting with other critical stakeholders and having a robust discourse at the conference.  As an emerging leader in the oil and gas sector, the NOG presents the appropriate platform for us to exchange ideas and synthesize new innovations,” Adebutu said.
    Petrolex has emerged to be one of the leading players in the Oil and Gas industry, especially the downstream sector. CEO, Segun Adebutu was listed among Businessday’s 50 most influential Nigerians for the year 2017.
    Petrolex’s legacy investment is the mega oil city, which contains the largest tank farm in Sub-Saharan Africa. The first phase of the project has been completed and commissioned. It is the 300 million litres mega tank farm, consisting of twenty 15 million litre storage tanks. The tank farm has 30 loading gantries with a scheduled truck loading and fuel management system, and a 4000-truck capacity trailer park for efficient loading. To supply the facility and ensure ease of distribution, a jetty has been constructed and vessels moored. Petrolex is also set to build a 250,000-bpd capacity refinery, which will be the second private refinery in Nigeria.

  • Aiteo Wins Three Awards at Guardian Oil & Gas Roundtable

    Nigerian energy giant, Aiteo group has emerged winner in three different categories at the Guardian Oil & Gas Roundtable and Awards, recently held in Lagos.

    The Aiteo group was adjudged and awarded winner in the following categories: Oil & Gas CSR/Sustainability Company of the Year (Upstream), Oil and Gas Company of the Year (Upstream Indigenous) and Oil and Gas CEO of the Year (Upstream Indigenous)
    The forum also recognises and celebrates institutions, organisations and personalities who have contributed and still contribute immensely to the growth and development of the Nigerian oil and gas industry.
    According to Victor Okoronkwo, Aiteo’s Senior Vice President, the awards are a testimony to the organization’s commitment to adding value across the Spectrum of the Nigerian Energy milieu.
    “In recent years, our value footprints have become more glaring on the Nigerian energy scene. These include strong commitment to local content, host community engagement, and Corporate Social Responsibility. We have also been a major active partner of the Nigerian Super Eagles.”
    With a peak production capacity of 90,000 bpd, Aiteo is often called the largest indigenous oil company in Nigeria. It is the operating partner of the Oil Mining Lease(OML) 29, one of the largest offshore oil blocs in the Eastern Niger Delta. It is also the operating partner of the Nembe Creek Trunk Line(NCTL), a 115km long, 150,000bpd capacity oil delivery pipeline traversing over 100 indigenous autonomous communities between Rivers and Bayelsa States.
    In the CSR arena, Aiteo has become the foremost financier of football in the country after a string of contributions to the Nigerian Football Federation(NFF). It began with a N2.5 billion 5-year deal with the NFF. To support local football, Aiteo took over the sponsorship of the Federation Cup, Nigeria’s oldest football tournament, now renamed Aiteo Cup. On the continental stage, Aiteo partnered with the Confederation of African Football(CAF) to sponsor the African Football Awards in January this year.
    Aiteo’s contributions also include incentives for the Super Eagles in form of financial reward of N18 million naira for every goal scored and unresponded by their opponents in the World Cup.
    The Guardian Oil and Gas roundtable and awards aims to draw critical stakeholders together to discuss and present resolutions on issues affecting the Nigerian Energy sector.

  • How to make oil fields profitable, by engineers

    Proper execution of a field  development plan (FDP) can boost oil production, the Society of Petroleum Engineers (SPE), Lagos Section, has said.

    In a communiqué after its technical symposium entitled: “Expediting FDP Approval: Key actions to ensure efficiency and value-added processes’’, the body noted the importance of FDP and the need for speedy approvals by relevant government agencies.

    In the communiqué signed by the SPE Lagos Section Chairman, Mr. Temitope Oshuntuyi, which was made available to The Nation, the petroleum engineers, however, noted that not every field is economic to develop and a wrong plan attracts a huge price.

    An FDP is essential for optimal and economic production of a field.

    The engineers said there was an increased need for FDP approvals as oil price was rising and companies were not willingness to develop their fields.

    Some of the reasons for delays in getting approvals or rejection of FDPs include inadequacy of plans in addressing the project’s pressing issues, lack of continuity in the quality of FDP plans received by the Department of Petroleum Resources (DPR).

    Others are partners working in isolation, lack of understanding of fiscal regimes, gas utilisation, project execution, contracting strategy and project economics as observed by the National Petroleum Investment Management Services (NAPIMS), an arm of the Nigerian National Petroleum Corporation (NNPC) to the FDP approval process.

    Early engagement of stakeholders  for discussions to promote openness and clarity of purpose contributed to the success of FDPs that were approved on time, the body observed.

    Insecurity and too many bureaucracies increase field development costs even as technological advancements, such as surveillance with downhole gauges, multi-phase flow meters, digitisation, and artificial intelligence were slowly being adopted by DPR, which sought to ensure that these technologies had been tested.

    The SPE said: “Technology is key to lower development cost and remain competitive. Early appraisals and information acquisition help speed up the FDP approval process, as experienced by an Independent operator.

    “Field Development Plan and its approval could be a rigorous process depending on the Asset size.  DPR affirmed that contrary to speculations in some quarters, staffing was not a constraint to the timely approval of FDPs.

    “Therefore, early engagements with both NAPIMs and DPR and getting an alignment on their expectations are critical to speedy and efficient FDP approval process. Cluster development and Asset risk sharing should be considered to enhance maximum technical and commercial recovery. Operators should consider sharing facilities, while developing FDPs, especially new operators with single concessions.’’

    It continued: “All companies must consider monetisation of gas in their FDPs as no new project will be sanctioned without it. Even if the gas monetisation plans cannot be immediately achieved, it must be included in the FDP to demonstrate good will.

    “All stakeholders should ensure the continuity of resource persons that handle the FDP process across all concerned disciplines for transfer of learnings from one FDP to another.

    “Regulators should standardise the FDP approval processes for both new and brown field developments, with a distinction in the requirements for either.’’

    SPE said there was the need for scalable regulation, urging operators to adopt upfront collaboration with stakeholders and regulators.

    It said: “Consideration should be given to streamline the approval process, eliminating multiplicities and too many processes; therefore, regulators need to integrate their workflow in a seamless manner.

    “DPR should champion a collaborative learning process. There should be an audit trail between when an FDP is submitted and when it is approved so that bottlenecks can be identified.

    “New technologies and processes that can be adopted by DPR and NAPIMS include easily visible and auditable database like NIPEX, Multi-Phase Flow Meters (MFPM), commingling of small pools and use of downhole gauges.

    “DPR and NAPIMS should consider adopting technology such as commercially available interactive centers where FDP teams assigned to various assets can converge virtually to scrutinise the FDPs.”

  • Women most hit by lack of access to electricity, says Okuribido

    Women are mostly affected by lack of access to electricity, Council for Renewable Energy of Nigeria (CREN) President, Mrs. Anita Nana Okuribido, has said.

    She spoke at the yearly Women in Renewable Energy (WIRE) forum, organised by the Environment Africa Magazine.

    She said about 90 per cent of Nigerians do not have access to electricity of which women are negatively affected. According to her, women often resort to the use of kerosene and firewood for cooking because they don’t have access to good renewable energy sources.

    “At night, when they want to cook, they put on their kerosene lanterns to see and to cook, and when their children want to do their school assignments, they resort to kerosene but if you let them have access to electricity through provision of renewable energy sources, they can cook and do whatever thing they want to do because they have access to clean energy sources,” she said, adding women use a lot of energy for illumination, cooking and for doing their chores, so they need clean energy.

    She stressed the need for green entrepreneurship in the value chain of women owned businesses, particularly those in the small and medium enterprises (SMEs). According to her, if women can really become green and energy efficient and sufficient, they would be energy independent, adding once they are aware of how to make use of green devices and components, the few hours they have to do their commerce, they would be able to increase their earning power and increase their productivity. This, she noted, would create huge employment opportunities and impact meaningfully on the nation’s economy

    “Women have a lot of challenges, they have to do so many chores, and in the evening when they have the time to do their commerce they found themselves in the dark,” she said

    Okuribido stated that as part of awareness creation, the body has formed clusters of enlightenment campaign activities for the rural communities in the areas of electricity, food security, education, and health as well as capacity building, adding much can’t be achieved without capacity building and skill acquisition.

    “When we get to the community we get the women leaders, we get the youth leaders and we do capacity building programme for them, so that they can increase their earning power.

  • MOMAN gets new executive secretary

    Mr. Clement Isong is the new Executive Secretary of Major Oil Marketers Association of Nigeria (MOMAN).

    He succeeds Mr. Obafemi Olawore, who has retired from the organisation, after 17 years of service. He is the first executive secretary.

    Isong, at a briefing in Lagos, said Olawore would be missed.

    According to him, Olawore at several times championed the need for the liberalisation of the downstream sector of the oil and gas industry to attract more investments.

    Isong said though Olawore came at a time of great uncertainty, he advanced the objectives of the organisation.

  • How govt plans to end estimated billing, by Fashola

    The Federal Government is putting measures in place to stamp out the controversial estimated billing system in the power sector.

    Minister of Power, Works and Housing, Mr. Babatunde Raji Fashola (SAN) said the legislative arm of government is considering criminalising estimated billing to earn consumers’ confidence while plans are ongoing by the executive and legislative arms of government to operationalise the Meter Asset Provider (MAP) regulation by leveraging private sector experience to bridge the metering gap in the sector using the N37billion Seed Fund provided by the government.

    The minister noted this at the 28th monthly meeting of operators in the electricity industry, which held at Mando Transmission Station, Mando, Kaduna State. He stated that these measures have become imperative in view of instances of estimated billing, which have become  major cause of distrust to customers in the power sector and advised the DisCos to leverage the N37billion facility to a Meter Asset Provider.

    The operators expressed concern about reports of electricity distribution companies (DisCos) not connecting to completed distribution facilities built by the Niger Delta Power Holding Company Limited (NDPHC) and the Rural Electrification Agency (REA) on the grounds of difficulty in servicing the areas.

    As a result of this development, the stakeholders resolved that all DisCos should submit to the Nigerian Electricity Regulatory Commission (NERC) a list of the areas and communities within their franchise where they have difficulty in serving the customers and state the reasons in other to enable the government review and develop policies that will ensure service to these areas.

    Another major subject that dominated the discussions was the challenge of power supply disruption, which comes with the rainy season such as breakdown of power equipment following thunderstorm, among others. Fashola, therefore, reiterated the need for operators to be proactive in resolving issues, which affect the quality of service during the rainy season in areas of repairs, maintenance and replacement of obsolete power infrastructure that will happen during adverse weather.

    He emphasised the need for the DisCos to regularly get weather information from the Nigerian Meteorological Agency (NIMET) to predict service disruption and frequently inform consumers on restoration plans and timelines.

    Fashola said: “I have used the opportunity of this meeting to focus attention of operators, generation companies (GenCos), Transmission Company and DisCos, who are the points of public interface, on the need to pay more attention to service delivery, repairs, and maintenance of equipment.

    “We are beginning a different weather season that will see more rainfall, thunderstorms, lightening and windstorms. All of these will affect regular supply one way or another. Trees will fall and disrupt lines, poles and lines may be damaged, and service will be disrupted.

    “In all these situations, we must prepare our staff to anticipate, plan, and respond. Most importantly, we must inform the public about the problems and what we are doing to restore service whenever there are disruptions. As a consumer myself, nothing gives me more comfort than when my service provider shares information about service disruptions. It tells me quickly that at least, somebody knows that there is a problem, and gives me hope that something is being done about it.”

    Kaduna Electricity Distribution Plc Managing Director, who hosted the meeting, reported that consumers within his franchise now get increased hours of power supply daily.

  • PNG achieves one million man-hour LTI-free operation

    PNG Gas Limited, a subsidiary of Gas Train Limited, has achieved operational safety of one million man-hour without lost-time incident (LTI) at its Egbaoma Gas Processing Plant located at Ebedei, Ukwani Local Government Area of Delta State.

    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 operation. It is an oil and gas industry benchmark that evaluates adherence to safety and environmental requirements during operations.

    The operational safety milestone achieved by PNG Gas in January 2018, was a demonstration of its conformity with oil and gas industry best practices. This achievement, the management said, was made possible through the joint efforts and hardwork of the entire workforce.

    Commenting on the achievement, Board of Directors Chairman, Dr. Bolaji Ogundare, said: “This achievement reflects how best we have excelled. It shows the degree of excellence in our strategy, organisational leadership, process systems and health, safety and environment (HSE) culture, despite the business challenges in today’s economy.”  He enjoined the management to maintain this record.

    To the promoter of Gas Train and a Director in PNG Gas Limited, Charles Osezua, a Gas Engineer and Investor, who has championed several gas projects in Nigeria, “this safety landmark was achieved by God’s grace and the well thought out process the company was built on”. He commended PNG management effort for their adherence to the industry procedure and practice that ensured that the investors’ vision was kept alive.

    Osezua, who is also the Chairman of Owel-Linkso Group, said: “We are excited to have partnered African Capital Alliance (ACA) and look forward to achieving the objectives of Gas Train. Furthermore, he reiterated that ACA is still ready to support future Gas Train project development initiatives for the greater development of our country.”

    Recalling his past project experience on the Greater Lagos Natural Gas Distribution Pipeline Project, Escravos-Lagos Gas Pipeline phase II project, among others, said this team wouldn’t have done less considering the caliber of personnel that were seconded to the project from Owel-Linkso Group.

    According to its Managing Director, Gabriel Ilenreh, an engineer, the total man-hour, which culminated in achieving the one million zero LTI operation is the overall man-hour for carrying out the engineering, procurement, construction, installation and transiting into operational phase of Egbaoma Gas Processing Plant.

    He further stated that through strategic thrust, with cautious innovative efforts, PNG could achieve this milestone. “PNG is enthusiastic to leave its footprints in the energy space under his visionary leadership”, Ilenreh added. He also expressed gratitude to the company’s shareholders for their unwavering support.

    “PNG’s business model is structured with the aim of protecting the environment and creating value from our natural resources through its operations,” Ilenreh said, adding that the company converts waste (gas that ordinarily could have been flared) to wealth. The company processes gas from its raw state into finished products such as Liquefied Petroleum Gas (LPG), Propane, Condensate and Lean Gas.

    PNG’s operation empowers over 500 people in her value chain. It also expects to be producing about 78 tons of LPG per day, 57 tons of propane, 315 barrels of natural gas liquid and 25 million standard cubic feet of lean gas daily. The Wet Gas feed to the gas plant is from the Platform/Newcross JV marginal field (OML 38)

    Ilenreh also noted that another key success factor is that the company holds Community Affairs, Safety, Health, Environment and Security management in a holistic manner. “PNG believes that an efficient cashes culture is the fulcrum of interactions among people, environment, equipment, processes and procedures in the organisation.

    “The incorporation of safety into PNG’s core values was made possible through her vision for its valued personnel and assets. This achievement today was not without challenges, but the lessons learnt are immeasurable.

    “However, persistent commitment to internalising HSE process driven policies with the cooperation of our team has made this accomplishment possible. PNG looks forward to establishing a lasting presence in the gas industry space,” Ilenreh said.

  • Marketers target synergy with foreign crude refiners

    Oil marketers are fashioning out modalities to partner foreign crude oil refiners by December this year with a view to resume importation and further improve product supply in the country.

    The Independent Petroleum Marketers Association of Nigeria (IPMAN)’s National Controller of Operation, Mr. Mike Osatuyi, who disclosed this in an interview with The Nation, however, refused to mention the foreign refiners’ names, which the Association is discussing with in Europe and other continents. He added that the group has decided to keep the matter to its chest pending when the deal is sealed.

    The marketers, he said, begun the move to form synergy with notable oil refining companies abroad few months ago as part of efforts to improve importation of fuel and further prevent scarcity.

    He said the issue has reached advanced stage as IPMAN representatives and other marketers have met with officials of foreign oil refining firms on the issue.

    Osatuyi said: “Discussions on the issue of firming up relationship that would result in importation of crude into the country have reached a critical stage and marketers are not likely to suspend it. We (marketers) have signed a Memorandum of Understanding (MoU) with oil refiners in Europe and other continents and we strongly believe that the matter would get to a successful end.  Nothing has happened now on the issue of partnering the foreign companies. However, marketers are looking at December, this year, to finalise the issue of partnering the refiners for growth.”

    According to him, the right to give approval to marketers, who want to partner crude refiners abroad lies with the Department of Petroleum Resources (DPR) and not the Nigerian National Petroleum Corporation (NNPC). He said it is true that NNPC regulates activities in the oil and gas sector, but the Federal Government has shared the responsibilities of administering control of the sector to its parastatals for effective control.

    He said while the government has conferred the right to supervise some key elements of the downstream sub-sector on the DPR; NNPC is still the only agency that has the power to either discuss or revisit the issues of fuel subsidies in the country.

    “It is only the NNPC that can revisit subsidy issue through the approval of the presidency as it remains a very sensitive and key issue in the country for now. Without presidential fiat given to a governmental body to discuss the issue of subsidies, no agency can on its own do anything about it,” he added.

    He said IPMAN plays a crucial role in the sub-sector as it provides about 70 per cent of the marketers in the country.

    The issue, Osatuyi said, made the Association a force to be reckon with in the downstream sub-sector, adding that fuel supply would improve whenever marketers start importing fuel into the country.

    He urged the Federal Government to address problems facing the marketers in terms of access to foreign exchange (forex) by ensuring that they (marketers) and other users are able to access forex for growth.

    He said marketers would not find it difficult to get forex for importation once the problems in the foreign exchange market are addressed.

    He said the country will have enough fuel for growth when marketers are able to access forex from the Central Bank of Nigeria (CBN) without stress.