The Nation Newspaper

Category: Energy

  • Fed Govt backs Kaztec’s $1b fabrication yard in Lagos

    The Federal Government has backed the systems, facilities and technological skill sets used at the fabrication yard of Kaztec Engineering Company Limited, an arm of Chrome Oil Services Limited, located on Snake Island in Lagos.

    Minister of State, Petroleum Resources Dr. Emmanuel Ibe Kachikwu, who led top government officials and international oil companies to the yard, described the billion dollar investment plan by Kaztec as a demonstration of faith in the Nigerian Content development policy.

    Kachikwu urged industry operators to patronise more local goods and services as a credible, patriotic and logical strategy for cost reduction, noting that massive patronage of local content input into projects remains the best way to achieve lower production cost.

    He said while the government was working to attract the right investment capital for field development activities, operators should fully engage existing in-country facilities for in-country value and job creation as well as indigenous capacity and capabilities development.

    The minister acknowledged the technical capacity displayed by Nigerians at the Kaztecplant as impressive during his presentation on the activities of the firm. He noted that very few local oil service companies have been able to effectively position for the shallow water and deep offshore province from where the future development activities will come.

    Kachikwu highlighted that the upcoming major deep-water projects including Eni’s led Zabazaba field, which will be operated by the Nigerian subsidiary, Nigerian Agip Oil Company (NAOC) and Shell operated Bonga South West-Aparo (BSWAP) field will create enormous jobs for Nigerian oil service firms. He noted the imminent final investment decisions on the projects would spark off huge in-country value creation.

    He applauded Kaztec for its commitment, adding that the site of yard, which is in the remote part of the Snake Island, would open commercial and social activities in Ilaje village of the Island with multiple benefits including opportunities for skills acquisition and mass employment of youths, among others.

    He noted that despite considerable milestones achieved in Nigerian oil and gas industry content development policy drive, the industry is still far from the 70 percent Nigerian Content target by 2020.

    The Project Manager at Kaztec, Mr. Mike Simpson, said the fabrication yard was at tertiary level of infrastructural development in a vast island space that holds a free zone status.He said the company has already committed over $300 million in development of facilities for Engineering, Procurement, Installation and Commissioning (EPIC) contracts, and has mapped out another $450 million for second phase of yard development with outlook for incremental investments until the full development plan is realised.

    The Chairman of Chrome Oil Services Limited, Sir EmekaOffor, said the company has the requisite capacity to rehabilitate and upgrade the nation’s ailing refineries if given the opportunity in line with the Nigerian Content policy of the government.

  • Experts chart ways to efficiency in power sector

    Electricity Distribution Companies (DisCos) must be super-effective in every responsibility bestowed on them for the power sector to thrive, a renewable energy expert has said.

    The Chief Executive Officer, SolarCentric Technologies Limited, Adetunji Iromini, stated this, noting that “the power sector value chain is financed by bill settlement from consumers and it is DisCos that interfaces with the consumers.”

    For efficiency in the sector, he listed metering, tariff and decayed infrastructure as three-pronged issues that must be addressed by stakeholders in the sector.

    On metering, he said consumers must be adequately metered to reduce apathy. “Compelling cases for cost-reflective tariff has been made by many and there is just no point debating this. The sector requires huge investment and without clear and unambiguous means of recovering the investment, appropriate investment would continue to suffer. According to the recently released Power Sector Recovery Programme 2017-2021, a unit of energy is estimated at N50.30 indicating that the sector is subsidised,” he noted.

    Explaining  what  he  called ‘decayed infrastructure,’ he said: “The quantity of energy made available to the consumer is lower than demand. We continue to hear cases of stranded energy, which Transmission Company of Nigeria (TCN) cannot evacuate and evacuated energy being rejected by the DisCos due to inability within their network to distribute and manage bill settlement effectively.”

    On  whether the Federal Government should take over the sector fully again or not, he said: “governments all over the world have largely proven to be unable to manage businesses.

    “The government is currently doing what is expected of it by enacting laws and policies that favour the sector. Such include the Mini-Grid Policy, Independent Electricity Distribution Network (IEDN) and the Captive Power Generation in the distributed generation area. A 30:30:30 recommendation that we made at National Council on Power (NACoP) Kaduna in 2016 was approved as a policy. The policy simply promotes renewable energy, that is, 30 per cent renewable of 30 gigawatts (GW) by year 2030. This was an idea we deliberated upon based on existing circumstances and realities of our environment.

    ‘’The working group (Renewable Energy Committee) that I represented at the Nigerian Economic Summit Group (NESG) put this forward and it is a policy today. Each of the policies or a combination of some will promote efforts on the much needed distribution and generation. That is the guaranteed way forward from the current rigid central grid system.”

    Iromini was one of the Renewable Energy experts fielding questions from The Nation during the 12th edition of a seminar series tagged: Potentials of Renewable Energy, organised by the Consulate General of the Federal Republic of Germany, Lagos and the Delegation of German Industry and Commerce in Nigeria / CIM.

    He in the meantime expressed optimism about power stability in Nigeria, adding that, ground for that is being set already, despite the privatization challenges.

    The Campaign Director, Nigeria, Power for All, Mrs. Ify Malo, in her recommendation towards power stability in the country, called on the government to decentralise RE through mini-grid for rural areas, Stand Alone Home Solar System to serve SMEs and Biogas and Biomass for highly industrialised states like Lagos.

    While the seminar tagged: “Solar PV Development in Nigeria” lasted, it featured Malo making presentation on: Mini-grids as a driver for the 4th Industrial Revolution; Dolapo Kukoyi, Partner, Details Commercial Solicitors, presenting on: Mini-grid Regulation while Bolusope Ogboye, Renewable Energy Transaction Advisor, REEEP (Winrock Int’l), made presentation on: Access to Finance for Mini-grids.

    Other speakers include: Duke Benjamin, Head of Energy and Environment Desk, Delegation of German Industry and Commerce in Nigeria, Mrs. Alexandra Herr, Deputy Consul General of the Federal Republic of Germany, Lagos.

  • OVH Energy gets CEO

    Leading downstream company OVH Energy has ap-pointed Huub Stokman its chief executive officer (CEO).

    Prior to his appointment, Stokman was the head of Puma Energy International in Angola, and was responsible for the business, which included managing retail forecourt, terminal/logistics operations, as well as B2B business for fuels, lubricants, aviation fuels and bitumen.

    Before joining Puma, he spent over 20 years at BP, during which he was responsible for sales and marketing as well as major projects across 15 European countries.

    Huub Stokman has, over the years and in various capacities, proven to be an accomplished executive leader in a number of international downstream businesses, with a history of successfully enhancing bottom-line performance.

    Speaking on his appointment, Huub Stokman said: “I am excited to have been selected to lead OVH Energy.There is remarkable potential for this business in Nigeria and together with the strong and talented OVH Energy team and our key stakeholders, I am confident we will continue to build a market leading business.”

  • Eni, ADNOC seal $875m deal on two UAE fields

    Italian oil firm, Eni, has signed  two concession agreements with Abu Dhabi National Oil Company (ADNOC) for the acquisition of five per cent stake in the Lower Zakum offshore oil field and 10 per cent stake in the oil, condensate and gas offshore fields of Umm Shaif and Nasr.The stake acquisition is for  for a participation fee of about $875 million for 40 years.

    Eni’s Nigerian subsidiary Nigerian Agip Oil Company said the signing  in Abu Dhabi, United Arab Emirates(UAE) was attended by  Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, and Deputy Supreme Commander of the UAE Armed Forces, the Italian Prime Minister, Paolo Gentiloni, Dr Sultan Ahmed Al Jaber, Abu Dhabi National Oil Company (ADNOC) Group Chief Executive Officer, and Eni’s Chief Executive Officer, Claudio Descalzi.

    The agreements represent a strategic move for Eni to gain access to a country with hydrocarbon reservest hat are among the largest in the world.

    Lower Zakum is about 65 kilometres off the coast of Abu Dhabi. The discovery dates back to 1963 and production began in 1967. It has a target production of 450,000 barrels of oil daily. Umm Shaif and Nasr are located about 135 kilometres from the coast of Abu Dhabi and have a target production of 460,000 barrels of oil daily.

    Eni’s CEO Claudio Descalzi said: “I’m very pleased about this agreement creating a larger presence for Eni in Middle East, in line with our expansion strategy, and creating a strong alliance with ADNOC and Abu Dhabi. The stakes in the two concessions give access to giant fields with huge potential and Eni is willing to contribute its best technology to maximise the future production.”

    Dr Al Jaber said: “These agreements underline the international market’s confidence in ADNOC’s long-term growth plans and the UAE’s stable and reliable investment environment. They also broaden and diversify our partnership base, while contributing experience, technology, capital and market access.

    “Our partnership with Eni, and other concession partners, will enable us to accelerate our growth, increase revenue and improve integration across the upstream value chain, as part of our ongoing transformation and build on the foundations that have been laid to deliver a more profitable upstream business. With these agreements ADNOC continues to leverage its 46-year legacy of successful energy partnerships, in support of its 2030 strategy.”

    In both concessions, ADNOC owns a 60 per cent stake while the operator is ADNOC Offshore.

  • EMMAN to govt: break meter supply monopoly

    The Electricity Meter Manufacturers Association of Nigeria (EMMAN) has appealed to the Federal Government to break the monopoly of distribution companies (DisCos) in the sale of meters to consumers.

    Its Executive Secretary, Mr Muyideen Ibrahim, said the development would help address the challenges of estimated billings.

    According to him, breaking the monopoly would enable consumers procure and own meters.

    He said it would address complaints over outrageous billings from the distribution companies, adding that the association had advocated that the government liberalise the metering arm of the power sector so that everybody could have access to meter.

    Ibrahim said: “If every consumer has prepaid meter, it will allow them to manage electricity consumption and the DisCos will collect revenue maximally without billing outrageously. But now the consumers are short-changed because they are being given estimated bills. It presupposes that the DisCos are smiling to the bank while the consumers are suffering.

  • Ikeja Electric to customers: desist from energy theft, vandalism

    The management of Ikeja Electric has appealed to customers to desist from meter bypass, vandalism and tampering with facilities, including meters, as anyone caught will be prosecuted.

    Its Head of Corporate Communication, Mr. Felix Ofulue, made the appeal when the leadership of the Association of Energy Correspondents of Nigeria (NAEC), led by its new Chairman, Olatunde Dodondawa, visited the distribution company at its Ikeja head office.

    He stressed that the company was committed to metering customers within its network as soon as possible. According to Ofulue, the company has since launched concerted effort aimed at curbing unethical practices across its network and also encouraged customers to report such practices.

    “Very soon, there will be massive prosecution of those that have tampered with meters, and we are going to step up on that because the rate at which people tamper with their meters is very high. We are not going to accept a situation where something is supplied and it is not paid for,” Ofulue stated.

    Also, he explained that metering is one of the major items to be addressed by Ikeja Electric when handling over estimated billing.He noted that: “With these meters, the customers can regulate their consumption unlike the estimated billing or post-paid where they hardly notice the units consumed. They can manage their own consumption and it makes them to pay for what they consumed. To the distribution company, meters relieve the firm the cost and staff the burden of preparing and distributing bills. With meters, DisCos will collect revenue maximally without estimated billing.”

    He also condemned the increasing vandalism of equipment within its operation, adding that it has forced the company to spend money meant for other electricity development projects on repairs.

    He said electricity materials such as cables and wires, among others, had either been stolen or vandalised.

    Ofulue called on energy reporters to help educate consumers on the challenges of the power sector and the need for customers to pay their bills.

    He maintained that a  lot of electricity consumers in Nigeria are oblivious of the transition that has happened from public to private enterprise and as such do not see electricity as a commodity to be bought and paid for. They, therefore devise multiple ways of engaging in electricity theft through meter tampering or outright bypass.

  • IPMAN seeks increased fuel supply

    The Independent Petroleum Marketers Association of Nigeria (IPMAN) has urged the Nigerian National Petroleum Corporation (NNPC) to intensify the distribution of petroleum products to Western depots to address fuel shortage in the hinterlands.

    Its Chairman, Western Zone, Alhaji Debo Ahmed, made the appeal in Lagos., saying increased fuel supply to the zone becomes necessary due to IPMAN members’ inability to import petrol.

    He, however, commended the NNPC for improving supply but noted that the distribution was still not enough for the zone. According to him, some depots within the western zone have begun to receive massive supply of petroleum products from the NNPC, which independent marketers enjoy, loading at ease to the hinterlands.

    He said: “The supply of petrol to the depots has improved in the western zone, but we appeal to the NNPC to maintain the tempo. All depots within the western zone now sell petroleum products at government-regulated prices unlike before when petrol was sold above ex-depot prices.

    “We, the marketers, under the western zone, commend the management of NNPC for addressing the petroleum distribution challenges to depots in the zone. Government has set the pace for steady supply of petroleum products across the country.”

    Ahmed praised President Muhammadu Buhari for his concern in easing fuel distribution and supply to every part of the country, adding that the concern had informed the commitment of the NNPC’s management in upgrading storage facilities across Nigeria and ensuring the availability of products.

  • ‘Shale gas no threat to domestic market’

    The President, Nigerian Gas Association (NGA), Mr. Dada Thomas, has assured firms involved in the supply of natural gas to the domestic market that shale gas will not negatively impact their business.

    Shell Nigeria Gas Limited, Axxela Group, Falcon Corporation and Frontier Oil and Gas Limited are major natural gas supplying firms in Nigeria.

    Thomas said though shale gas was not a threat to the domestic market, it was a menace to gas export target of Nigeria.

    Thomas, who is the
    managing director of Frontier Oil Limited,  explained that domestic gas market had location advantage as it was still growing.

    His words:m “Those exporting gas will have to rise up to the challenges posed by growing output of shale gas because the liquefied natural gas (LNG) contracts are long term contracts. Besides, we don’t need to have shale gas as  a country because we have abundant gas resources. So there is no need to be looking at something very difficult when we have something that is very easy.

    Thomas told The Nation on the sideline of the Nigerian International Petroleum Summit in Abuja that shale gas and oil revolution had completely changed the energy dynamics across the world, which largely contributed to the current market oversupply especially in oil.

  • NNPC to reduce daily losses in fuel supply to N516m

    The Nigerian National Petroleum Corporation (NNPC) is to reduce daily losses from N774 million to N516 million, Group General Manager, Public Affairs Division, Ndu Ughamadu, has said.

    He said the corporation would achieve this by cutting the level of fuel consumed from 60 million to 40 million litres.

    He noted that product diversion and activities of some unscrupulous marketers contributed to the high consumption and once the corporation plugged the holes,  consumption level would drop.

    In a telephone chat, Ughamadu said a large portion of the fuel supplied to the market was diverted to neighbouring countries, such as Benin Republic, and Togo.

    He said NNPC has partnered the Nigerian Customs Service (NCS) to check the smuggling of petroleum products.

    Ughamadu said: “Our (NNPC’s) under-recovery was N774 million as at the time the level of fuel consumed in the country rose to 60 million litres per day. We, at NNPC, discovered that the higher the level of fuel that is being consumed in the country, the higher the losses recorded by the country, as a sizeable portion of the fuel is being smuggled out of the country.

    “To reduce fuel consumption, which in most cases, is smuggled out of the country, the corporation decided to partner the Nigerian Customs Service (NCS). Through this means, the Customs would help to check smuggling of petroleum products by mounting surveillance at the borders.”

    He said NNPC discovered 200 filling stations in one of the borders in the country, stressing that the partnership between it and the Customs would help in addressing problems, such as hoarding and smuggling of petroleum products, which he said, contributed to the fuel scarcity last December.

    “With the joint efforts of NNPC and the Customs, all the illegal petrol stations at the borders would disappear soon and the fuel consumption would reduce drastically.”

    He said the level of fuel consumption was 39million litres per day, adding that it grew to 80million litres per day during the fuel scarcity and later 60million litres.

    According to him, Nigerians are erroneously blaming NNPC for fuel scarcity that occurred recently, without considering other factors that caused it.

    On fuel scarcity, he said there was no scarcity in the country, as NNPC has supplied enough fuel to marketers for distribution to their retail outlets.

    He said there is fuel in states like Imo, Enugu, and Anambra, stressing that the rumour that those states do not have fuel was not true.

    He said there is a difference between selling fuel above the official pump price of N145 per litre by some marketers in the East and its unavailability.

    Ugbh    amadu said all hands were on deck to rid the fuel market of saboteurs who were frustrating the efforts of the government to supply fuel at approved pump price.

  • EKDEC to prosecute thieves

    Its Chief Executive Officer, Mr Adeoye Fadeyibi, said this while deliberating on how the company could improve its service delivery at a town hall meeting in Victoria Island in Lagos

    Fadebiyi, represented by Mr Joseph Esenwa, the Chief Finance Officer of the company, said there had been high rate of energy theft and non-payment of bills by customers within its network.

    He condemned the act, saying that the objective of the forum was to inform the customers about the company’s service as well as the huge amount of loss to energy theft.

    Fadebiyi warned customers to desist from energy theft, adding that the company would not hesitate to prosecute and jail those caught in the act.

    The EKEDC boss said the forum was to enlighten customers on the negative implication of energy theft while listening to their problems and complaints.

    “People go to our substations and vandalise cables, damage transformers, looking for transformer oil. In some cases, those illiterate ones think there is mercury in the transformer and destroy it, and we are losing a lot of money.

    “Apart from vandals, we have meters being bypassed. When you look at all these losses, the cost is enormous.We lose millions of naira monthly to vandalism and theft of our equipment.”

    He added that the forum also aimed at getting customers’ view on strategic solutions to the problems. “It has also come to our notice that some people have been illegally connecting to our energy.”