The Nation Newspaper

Category: Energy

  • Fashola directs DisCos to meter customers, MDAs

    Fashola directs DisCos to meter customers, MDAs

    The Minister of Power, Works and Housing, Mr. Babatunde Fashola, has directed the electricity distribution companies (DisCos) to give prepaid meters to their customers including government Ministries, Departments and Agencies (MDAs).

    He spoke at the 14th ministerial monthly meeting with operators of the power sector, held at the National Control Centre, Osogbo, Osun State. The minister emphasised that the purpose of the Nigerian Electricity Supply Industry (NESI) is to ensure that citizens can access power safely, reliably, and consistently and that it must remain committed to ensuring the achievement of those objectives.

    Fashola reiterated government’s commitment to its responsibilities in the power sector through policies such as the Power Sector Payment Assurance Guarantee to ensure liquidity stability in the sector so that generating companies are paid for their services. He also stated that all stakeholders remain committed to their various roles in supplying and distributing power to ensure that the power sector functions effectively.

    He urged electricity customers to play their role in the success of the industry, through the timely payment of bills, ending the vandalism of power assets, and the assault of electricity workers who seek to install or read meters. Federal Government had started by the payment of an initial tranche of N374,551,000 to Abuja Electricity Distribution Company (AEDC) for outstanding MDA debts at the Federal Secretariat, Abuja.

    According to a communiqué issued at the end of the meeting, discussions focused on identifying, and finding practical solutions to critical issues facing the Nigerian Electricity Supply Industry.

    The Managing Director, Transmission Company of Nigeria, it said, highlighted the issue of unutilised load (previously described as load rejection) currently causing high system frequency on the national grid, and encouraged the industry to take necessary steps to address the problem. TCN restated its commitment to expand transmission infrastructure and improve its operation and performance within the power sector value chain.

    The Nigerian Electricity Regulatory Commission (NERC) assured of Federal Government’s commitment to tariffs that ensure a self-sustaining power sector and to supporting NERC in applying sanctions where appropriate to ensure operators comply with the rules.

    NERC highlighted the recently reconstituted commission’s focus on fair but firm regulation in the following areas: enforcing DisCo metering commitments, prepaid meters for MDAs, centralised management of market revenues collected from all customers, appropriate capitalisation of DisCos, and prudent procurement. NERC was tasked with ensuring fair play for consumers and providers within the sector.

    Osun State Governor, Ogbeni Rauf Aregbesola, acknowledged the gradual improvement of electricity supply especially in the state which hosts the National Control Centre. He acknowledged the importance of the Power Sector Recovery Plan as critical to ensuring accountability for losses, improving customer service, customer accessibility, safety, and performance in the sector.

  • Agip to begin work on $13.5b Zabazaba deepwater project

    Agip to begin work on $13.5b Zabazaba deepwater project

    • Firm calls for tenders

    The Nigerian Agip Exploration Limited (NAE) is to begin work on its Zabazaba deepwater project estimated to cost $13.5 billion.

    The firm will this month begin to receive commercial proposals for the various activities lined up for the development of the field.

    The request follows the conclusion of the technical evaluation for the main packages of the project by the Nigerian Content Development and Monitoring Board (NCDMB) and NAE, with the aim to maximize local content. The packages include the floating, production, storage and offloading (FPSO) units, subsea, installation and rigs.

    According to NCDMB’s Executive Secretary, Simbi Wabote, the Board fast-tracked its evaluations and approvals on the Zabazaba project with a view to increase Nigeria’s crude oil production and create opportunities for the growth and development of Nigerian Content.

    Wabote noted that the conclusion of the technical evaluation has paved the way for NAE to proceed with its plans to receive and evaluate the commercial bids, conclude negotiations and award contracts in the second quarter of 2017, adding that with the call for tender and consequent commencement of work on the deepwater facility, a fresh wave of work activities is set to begin in the Nigerian Content sector.

    He commended the NAE for working harmoniously with the Board, adding that the company took all Nigerian Content requirements on board.

    The NCDMB Chief stated that the NAE plans to achieve first oil in 2020, hence it is determined to achieve the final investment decision (FID) in the second quarter of 2017 and start execution of the project in the third quarter.

    To bring the project to fruition, Wabote, urged contractors to submit reasonable commercial bids, bearing in mind the prevailing price of crude oil and the fact that Zabazaba is the only major project that has reached execution stage at the moment. The deep water project was introduced a few years ago, but later suspended after cost projections and other push backs made it unviable.

    He praised NAE for its determination to pursue the project despite the challenges in the market and charged all stakeholders to support fast-tracking the execution.

    NAE Vice Chairman, Mr. Massimo Insulla, had at a  meeting with Wabote underscored the importance of Zabazaba project to Nigeria, all Joint Venture (JV) partners and stakeholders in terms of revenue for the government and job creation. It will also grow small and medium enterprises, expand existing facilities and develop the skills set of the work force.

    Insulla praised the NCDMB and THE NAE teams for concluding the technical evaluation at a speed that was unprecedented in the industry. He also advised other approving entities to adopt the NCDMB’s model while executing their evaluations of tenders and other processes.

    Zabazaba and Etan fields are located in oil prospecting licence OPL (245) on the southern edge of the Niger Delta in water depths of 1,700 to 2,000 metres. The oil block holds oil and gas reserves of about 560 million barrels of oil equivalent. “Agip is developing the block in partnership with Shell Nigeria Exploration Company (SNEPCo). The Etan field will follow three years later and tied back to the Zabazaba FPSO from where the produced hydrocarbons will be processed and exported,” Agip said.

  • Ogoni communities discuss clean-up of ravaged environment

    Ogoni communities is discussing  how to clean their farmland, rivers and other natural habitats after the Federal Government initiated plans to fast-track the implementation of the United Nations Environment Programme(UNEP) report on the restoration of land polluted by oil in the Niger Delta region.

    The government amended the official gazette, which established the Hydrocarbon Pollution Restoration Project, among other decisions that would pave way for the restoration of the Ogoniland and other oil polluted areas in Niger Delta region in 2017. But Ogoniland is still affected by oil pollution, as cleaning exercise is yet to take place.

    The Bodo Council of Chiefs’ Chairman, Mene Slyvester Kogbara, said discussions were ongoing to ensure that oil-ravaged areas were cleaned. Bodo communities have 16,000 people who are located in Kogana Local Government Area of Rivers State, he added.

    In an interview with The Nation, Kogbara said the affected communities have been holding meetings with companies contacted to do the job by the oil firms. He said: “The communities through their chiefs have been holding meetings with the firms that are contracted by oil companies to clean the land. A meeting between the communities and the firms that are going to clean the land was billed to take place last Friday but it did not hold. The representatives of the oil cleaning firms were not available due to some reasons. We are almost arriving at a period, when the land and the rivers would be purged of oil pollution.”

    He attributed the absence of oil cleaning firms at the meeting to communication gap, adding that the problem would be resolve soon. He said residents of the oil-polluted communities are upbeat that their areas would be cleaned coupled with the fact that their conditions would be normalised soon.

    According to him, socio-economic activities have been paralysed due to delay in cleaning the areas.  “Despite efforts made by the Federal Government to ensure the wellbeing of people in the oil producing areas of the Niger Delta, the residents are living in abject poverty. The 12,000 acres of farmland in Ogoniland has been destroyed by oil. Also, oil spills have destroyed the rivers in Ogoniland.

    “Farming and fishing are the traditional sources of livelihood in Ogoniland but due to oil-pollution, the residents have not been able to earn a living. They are primarily farmers and fishermen implying that they do not have any other means of livelihood. That is why they (residents) are at the mercy of oil firms that produce and explore oil in the areas. Until Ogoniland is cleaned, no meaningful progress can be achieved in the area,” he added.

    He commended the Federal Government for putting in place measures to restore peace in Niger Delta region, stressing that the development would speed up activities in the region.

    He said the processes of reclaiming the land and other natural habitats from oil pollution were long, adding that residents of the affected communities would enjoy in the long run. He urged the Federal Government and other stakeholders in the value chain to work together to develop Niger Delta region and the oil and gas industry, stressing that this is the only way by which the potentials of the industry can be harnessed to improve the economy.

  • ‘Splitting PIB not guarantee for passage into law’

    ‘Splitting PIB not guarantee for passage into law’

    • Idea politically motivated

    Splitting the Petroleum Industry Bill (PIB) into four parts is not a guarantee for its passage into law, the Managing Partner, J.O. Adidi & Co, John Adidi, has said.

    He said members of the National Assembly had failed to understand the key critical issues, which is the fact that Nigeria requires such laws g that would attract foreign investments into its oil and gas industry.

    He noted that most of the investors were moving away to other African countries including Gabon because of the uncertainty inherent in the Nigerian oil and gas operations.

    Adidi, who spoke with The Nation in Lagos, warned against continued resistance to the demands for special provisions in the PIB for the host community, adding that the issue of coming from the north or south should not come in when host community matter is involved.

    He said the 13 per cent derivation given to the oil producing states was not any reason to resist the demand for certain provisions for the host communities. According to him, the damage done to the ecology, the bio systems in these areas is something that would leave for several decades.

    He said the issue should be how to ensure that whatever is given to the host communities was used judiciously for infrastructure and human capital development, youth empowerment and creation of alternative industries and employment generation in these host communities so that when the oil eventually dries up, there would be alternative industries to employ the youths.

    When this is done, the restiveness of the youths in the Niger Delta region and other areas there is oil would certainly be minimised.

    Adidi noted that there was nothing too much to achieve peace. According to him, the new economic recovery and good plan of the government including 2.1 million barrels production per day would not be achievable if there is restiveness in the host communities

    Adidi said: “Splitting the bill is not the issue, what were the issues that made the bill not to be passed? If you look at the issue of fiscal systems, the IOCs were not comfortable with what was being proposed to them, the north was not happy with the host community provisions and so on. We need to go beyond all these rhetoric to address the main issues, he added.

    He said there was lack of focus and patriotism in looking at the bill. “People are being myopic, in some areas, issues that should not come to the front burner are being brought up. it is not the issue of splitting, it is how to get this bill passed and encourage the inflow of investment into the country,” he stated.

    He said the critical issues had not changed even with the splitting of the bill, adding there was the need to really engage the lawmakers and make them understand the need and the critical issues in the bill.

    Structural reform, licensing arrangement and the tenure of licensing, oil prospecting licence including the fiscal regime in terms of what should be the government take, the company’s or operator’s take in terms of royalty and taxes, he said, were some of the critical issues that needed to be looked into.

    Also the incentives that would encourage the international oil companies (IOCs) to come in should also be in place, adding if you set up an incentive regime that would discourage them you are still going to achieve nothing.

  • BEDC honours Idahagbon community

    Benin Electricity Distribution Plc (BEDC) has honoured Idahagbon Community in Oko Central area of Benin, Edo State, for its role in the arrest and prosecution of two electricity vandals, saying if all communities emulated and exhibited such responsibility, vandalism would be eradicated from the power sector.

    Its Managing Director/CEO, Mrs. Funke Osibodu, stated this at a ceremony to honour community leaders and youths who caught the vandals and handed them over to the police for prosecution.

    She stated that even though it is the responsibility of distribution companies (DisCos) or law enforcement agencies to ensure electricity equipment such as transformers were safe and free from vandalisation, the best situation will exist when communities take up responsibility and become vigilant over power equipment within their neighbourhood.

    “We will all sink and be swallowed by this monster (vandalisation) if we fold our hands and say or do nothing about it. Yes, some might argue that it is the responsibility of the DisCos or law enforcement agencies to ensure that this equipment are safe and free from vandalisation. We and the law enforcement agencies have accepted this responsibility but even at that, the truth is that the police and BEDC cannot be everywhere we have transformers,” said Osibodu, who was represented by Chief State Head, Edo, Mr. Fidelis Obishai.

  • Schneider restates commitment to quality service

    Schneider restates commitment to quality service

    Schneider Electric Nigeria, the global specialist in energy management and automation, is rolling out service centres for solar solutions for its customers in order to provide optimum after-sales services and grow local intimacy with its customers.

    To buttress the commitment, the Conext Hybrid Inverter Service Training Programme was held from 28th March to 30th March, 2017, at Schneider Electric Engineering and Solutions Centre in Lagos.

    Selected partners were invited to the training, which was conducted by L3 Solar Expert, Dr Gerry Paz, from Schneider Electric Australia. Participants were trained on how to install and service Schneider Electric Solar solutions. The Training also presented participants with the skills to carry out hands-on troubleshooting as well as Inverter assembly and testing that will enable them provide end users with direct competent after-sales support.

  • Local E&P firms produce about 180,000 bpd

    Indigenous oil exploration and production (E&P) companies produce about 10 per cent of the total national output – between 180,000 and 200,000 barrels per day of oil (bpd), Chairman, Society of Petroleum Engineers, Nigeria Council, Dr Saka Matemilola, has said.

    Matemilola said the jump in oil production by local E&P firms was due to Shell’s divested interests in some juicy oil blocks. Shell and co-venturers, including Total and Agip, divested their 45 per cent interests in over seven oil blocks and they were acquired by local firms.

    He said the firms included Seplat, Oando, Aiteo and others, adding that some companies produce on the average, 10,000 – 70,000 barrels per day.

    He said the oil fields bought by local firms from the International Oil Companies (IOCs) were active, strong and boast of huge potential.

    In an interview with The Nation, Matemilola said local oil companies produce about 180,000 barrels of crude oil per day, adding that the figure represents between eight and 10 per cent of Nigeria’s total oil output.

    He said the divestments of shares by IOCs have paved the way for the emergence of local oil companies, noting that the development has enabled locals to perform big-ticket transactions.

    Matemilola said: “The divestment is a blessing in disguise for the industry. Without the divestment, indigenous oil companies would not have been able to adequately explore for oil. Now, local firms participate in that area, hitherto regarded as the exclusive preserve of oil majors in Nigeria.

    “The assets that were taken over by local operators are producing well. The performance of those assets have been either doubled or tripled by the indigenous oil companies that bought them from the IOCs. This is an indication that when local operators are given the opportunity, they would do well. When opportunities in the nation’s oil and gas sector increase, it is a plus for the economy.”

    According to him, divestment has opened doors for local oil companies, adding that the development has enabled them acquire technology and expertise needed for oil exploration. He said no organisation can lay claim to technology, adding that both local and foreign can now boast of technology that is highly sophisticated in the industry. He said the local companies can operate well without expatriates.

    “How many expatriates are in Seplat, Aiteo and other local oil companies? We seem to underestimate the capacity and technical know-how of Nigerians, which should not be the case. I have been in the industry for over 20 years now and I can tell you that some of the best technocrats in the nation’s oil industry are Nigerians.

    “Unfortunately, we do not give credit to ourselves, just because of the way in which past leaders have mismanaged the country’s resources. Just look around some of the companies, which bought the assets of the IOCs, how many expatriates do they have?” he asked.

    He ruled out competition between the local firms and IOCs in crude oil exploration, adding that there is no basis for the two groups to compete with each other. He said experience has shown that IOCs are rooted in oil exploration activities, adding that it would take local firms some time before they could match the records of foreign owned oil firms.

    Matemilola, who is also the Chief Petroleum Officer with First Exploration and Petroleum Development Company Limited, advised local oil firms to look for areas where their core competences are, and leverage them for growth instead of thinking of how to compete with the majors.

    “It would be better if each entity defines the area where it is going to play and what level it would play in the industry than trying to compete with one another.  The issue is about how to manage the available resources and not competition.  When a firm, for instance, masters its area well, it would be easier for the firm to achieve growth in that area,” he added.

    He explained that the oil and gas industry is wide and can accommodate many players who are ready to put resources and money together in order to encourage growth, adding that this is the trend globally, which oil companies in Nigeria must follow.

  • SPDC LiveWIRE beneficiaries to benefit from $.8m fund

    SPDC LiveWIRE beneficiaries to benefit from $.8m fund

    Twenty-eight beneficiaries of the Shell Nigeria LiveWIRE programme are retooling to get a good share of the $800,000 growth fund for the year, provided by Grofin Investment, Shell Petroleum Development Company (SPDC) has said.

    Grofin is a business development financier supporting viable, growth-oriented small enterprises in the Niger Delta through the Aspire Small Business Funds (ASBF) supported by the Shell Petroleum Development Company (SPDC).

    To brighten their chances of securing sufficient financial support from Grofin and other lending institutions, SPDC has completed a one-day Business Scale-up and Linkage workshop for the beneficiaries drawn from Bayelsa, Delta and Rivers States.

    “This is part of the mentoring element of Shell LiveWIRE. Our aim is to continuously contribute to creating sustainable employment, economic growth and social development through the provision of business development assistance to youths particularly in the Niger Delta,” said SPDC General Manager, External Relations, Igo Weli.

    Speaking at the workshop, SPDC Social Performance/Social Investment Manager, Gloria Udoh, urged the beneficiaries to make the best use of the mentoring and linkage opportunities to move their enterprises to higher levels.

    “This is an opportunity to sharpen your presentation, marketing and business relationship skills; understand how to grow your business; and learn how to make a successful pitch to access the Grofin SME loans and other business support facilities,” she said.

    Responding on behalf of the beneficiaries, Stella Nnaji described the workshop as “filled with so much energy, motivation and opportunities.” She expressed gratitude to SPDC and its joint venture partners for the LiveWIRE programme, which she said was making a world of difference in the growth of small and medium scale businesses in the Niger Delta.

    The Shell LiveWIRE is a flagship enterprise development programme designed to help young people explore the option of starting their own business as a real and viable career option.

  • Harmonisation of NIPCo, Mobil Oil operations begins

    Harmonisation of NIPCo, Mobil Oil operations begins

    • Mobil retail outlets now II Plc

    With the completion of acquisition of 60 per cent ExxonMobil’s shares in Mobil Oil Nigeria (MON) Plc, following statutory approvals from the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE), NIPCo Plc has begun harmonising the operations of the two firms.

    Its Group Managing Director, Mr. Venkataraman Venkatapathy, said though each of the entities would  function independently, the management would review the two business models with the intention to synchronise and harmonise their operations.

    Venkatapathy told reporters in Lagos that management would ensure adherence to the Mobil brand, while complying with ExxonMobil’s global standards.

    He said: “NIPCo Plc, an indigenous Nigerian downstream oil and gas company, is pleased to announce the successful acquisition of 60 per cent stake in Mobil Oil Nigeria Plc (MON), following due statutory approvals from the Securities and Exchange Commission and the Nigerian Stock Exchange.

    “With the acquisition now completed, NIPCo will review the two existing business models with intent to synchronise and harmonise their operations.  NIPCo intends ultimately, that each of the entities will remain and function independently.  Running the two entities separately will engender financial and strategic merits.

    “Focus will now be placed on expansion of the retail footprint under the Mobil brand.  Concerted efforts will be deployed towards promoting the Mobil brand of lubricants in Nigeria to ensure that it captures a much larger national market share, whilst ensuring that it continues to retain its pivotal position as the premium lubricant brand in Nigeria.”

    According to him, NIPCo will rigorously sustain and follow Exxon Mobil’s code of conduct, ethos and drive for operational excellence. Mobil Oil Nigeria will now be trading and transacting business with a new name that will be called II Plc (double 1Plc).

    He said NIPCO was delighted to be part of the 41,000 shareholders of Mobil Oil Plc, adding that the acquisition shall usher in stability, prosperity, sustainability and growth. In due course, NIPCo shall, in furtherance of its agreement with ExxonMobil, change the name of Mobil Oil Plc to II Plc while retaining the Mobil logo.

    NIPCO had on October 19, 2016, aquired 60 per cent stake in Mobil Oil Plc, and in March 2017, completed the acquisition of ExxonMobil’s stake in Mobil Oil Nigeria Plc in a deal put at N90 billion and one of the biggest in the downstream sector in recent years.

     

  • Output cut: JMMC reports high level of conformity

    The Joint OPEC/Non-OPEC Ministerial Monitoring Committee (JMMC) at its second meeting in Kuwait said based on the report of the Joint OPEC/Non-OPEC Technical Committee (JTC) for  February, OPEC and participating non-OPEC countries have continued their progress towards full conformity with their voluntary adjustments in production.

    The JMMC was established following OPEC’s 171st Ministerial Conference decision of last November 30, and the declaration of cooperation at the Joint OPEC/Non-OPEC Ministerial meeting, held last December 10.

    At the event, 11 non-OPEC oil-producing countries agreed with OPEC member-countries to accelerate the stabilisation of the global oil market through voluntary adjustments in combined production of about 1.8 million barrels daily.

    The declaration, which took effect from January 1, this year, is for six months and can be extended by another six months, depending on the supply and demand and global inventories status.

    The JMMC expressed  satisfaction with the progress on the matter, urging participating countries to press on towards total conformity. By lasty month, the OPEC and participating non-OPEC countries achieved 94 per cent conformity, an increase of eight percentage points over January’s performance. This demonstrates the willingness of participating countries to continue their cooperation.

    The JMMC noted that certain factors, such as low seasonal demand, refinery maintenance, and rising non-OPEC supply, have slowed the positive impact of the production adjustments on inventory drawdowns. Also, it observed the liquidation of positions by financial players in the market.

    However, it was felt that the end of the refinery maintenance season and a slowdown in the United States’stock-build, as well as the reduction in floating storage, will support the positive efforts to achieve stability in the market.

    In view of this, the JMMC requested that the JTC and the OPEC Secretariat review the oil market and report to the JMMC next month on the extension of the voluntary production adjustments as stipulated in the Declaration of Cooperation to ensure market stability.

    The JMMC will deliberate before submitting its recommendation to the participating countries. This reaffirms the commitment of OPEC and participating non-OPEC countries to continue to cooperate for the benefit of producers and consumers alike, as has been consistently advocated.