The Nation Newspaper

Category: Energy

  • Free eye glasses at confab

    Participants at this year’s conference of the Nigerian Association of Petroleum Explorationists (NAPE), were offered free eye checks and glasses by Seplat Petroleum Development Company Plc.

    Seplat, through its team of medical personnel, conducted tests for over 200 people during the two-day event that took place in Lagos.

    Most callers at the company’s stand received counselling, eye drops, medication and reading glasses free.

    The company, in a statement, said the the free eye test was part of its Corporate Social Responsibility (CRS) initiatives.

    “We have been organising the programme for years as part of our CSR programmes.We believe that the eyes are the windows to the soul. hence the decision to conduct free eye test for people,” he said.

  • How Nigeria can meet 40 billion barrels of oil reserve target

    HOw can Nigeria meet its target of 40 billion of oil reserve barrels by 2020? It is by channelling more investments into the production and exploration of crude oil, experts have said.

    Investments in onshore and deep offshore projects should be galvanised to encourage industry’s growth.

    Elijah White, the Vice President, Exxon Mobil Production Company and Prof Adeola Akinisiju said the country risked missing its target of substantially increasing its crude oil reserves by the turn of the decade, unless the government put together more investment-friendly fiscal terms in its proposed oil reform legislation.

    He said: “Nigeria needs to create a stable and attractive investment climate, competitive fiscal terms to attract capital and develop clear regulatory and competitive policies that would enable her to realise the full potential of the industry.”

    The country, he said, had a huge oil potential, advising the government, and private sector operators to work together for the sector’s growth.

    Akinisiju, a professor of Geology and President, Association of International Energy Economics (AIEA), called for a synergy of operations among stakeholders to encourage industry’s growth.

    The country would meet the 40 billion barrels projection, once a conducive operating environment was in place. He said oil theft, pipeline vandalism, among other untoward practices in the Niger Delta, has affected production drastically.

    According to him, right fiscal policies, improved operating environment and improved infrastructure in the oil producing states would attract more investors to the industry.

    Nigeria plans to raise oil reserves from 35 billion barrels to 40 billions by 2020. The target, experts believe, can be attained, if the Petroleum Industry Bill is passed.

     

  • NERC moves to clip GENCOs,’ DISCOs’ wings

    NERC moves to clip GENCOs,’ DISCOs’ wings

    TO ensure that the 14 power generation and distribution companies do not derail, the National Electricity Regulatory Commission (NERC) will soon release the guidelines for their operations

    The guidelines will regulate the safety, health and environmental operations of the GENCOs and DISCOs, NERC Chairman Dr. Sam Amadi said.

    Amadi told The Nation that NERC’s action was to prevent the firms from siting plants indiscriminately and posing security risks to the society, under the pretext of overcoming infrastructural problems. The commission, he said, would ban any of the firms without adequate safety and health standards from operating outside their domain when the guidelines are out.

    He said the commission was fine-tuning the guidelines to ensure that the firms carried out their operational obligations without problems.

    NERC, he said, had subjected the draft to public scrutiny to get more input. The guidelines will encourage safety of people during the installation, maintenance or operations of equipment by the firms.

    Amadi said: ‘’ In anticipation of the entry of private sector participants in the electric power sector, the Nigeria Electricity Regulatory Commission (NERC) is in the process of perfecting guidelines that will ensure that operators do not breach their licence obligations, and at the same time are able to temporarily operate out of compliance, where the urgent need arises.’’

    He defined the right to allow the firms operate outside their boundaries as “derogation,’’ adding that the idea is tied to certain safety and health conditions which the companies are obliged to meet.

    “Operators would be made to apply to NERC seeking for time to comply with codes and standards, and then submit detailed plans and timelines for eventual compliance,” he said, adding that the commission will consider the applications, and if found not to impinge on health and safety issues, and are justifiable, derogation may be granted.

    “We have our expectations from the companies and we would try not to compromise the safety of the operational environment of the operators,’’ he added.

    Amadi attributed the development to the weak state of the industry inherited by the new operators, noting that the sector is yet to rid itself of obsolete equipment, a development, he argued, that has made it difficult for the firms to operate and comply with the standards set by NERC on generation, transmission, distribution and customer welfare.

    According to him, issues such as distribution networks and customer care are vital to the industry’s growth. He noted that the companies are required to do something along that line. He said the DISCOs were obliged to take care of their customers by opening as many care centres as possible.

    Chief Executive Officer, Septa Energy Nigeria Limited Philip Iheancho said the industry is battling with infrastructural problems, adding that the GENCOs’ failure to access gas, among other materials, may force them to open plants outside their base without considering the implications.

    Environmental safety, he said, should be given priority when establishing plants in the power sector.

    President, Senior Staff Association of Power Holding Company of Nigeria (PHCN) Godwin Ifenacho said the planned privatisation of the National Independent Power Plant (NIPP) projects would succeed if investors were sure of getting production materials. There would be a challenge when the power plants find it difficult to access materials, Iheancho said.

    ‘’For instance, the distance between Omotoso and Papalanto power plants and Escravos Gas Project in Delta State is long, making it difficult for the plants to access gas for production. Based on this, the operators may be compelled to site gas plants outside their areas of operations, not minding the implications to the health of the environment,’’ he said.

  • Marketers insist on N50 for kerosene

    The Independent Petroleum Marketers Association of Nigeria (IPMAN) has urged its members to sell kerosene at N50 per litre nationwide.

    IPMAN President Alhaji Abdulkadri Aminu told reporters at the inauguration of the initiative to sell kerosene at N50 per litre in Lagos that the association would keep its promise of selling kerosene at it price to ensure its availability in line with the goverment’s mandate.

    He said selling kerosene at N50 was one of the projects of IPMAN,the Products and Pipeline Marketing Company (PPMC) and the Nigerian National Petroleum Corporation (NNPC).

    He said: “The association has been at the vanguard of ensuring that the product that is meant for the local people should be sold at approved price. This has also been the focus of the Minister of Petroleum. Today, we are grateful to God that we have seen it happening. This particular exercise, I want to assure Nigerians, is going to be sustained.”

    Aminu said the N50 price would be strictly enforced, adding that any member of IPMAN found selling above the regulated price would be sanctioned.

    He said a monitoring team would be inaugurated to ensure conformity in IPMAN outlets nationwide. He urged consumers to diversify from kerosene to gas, adding that the association has ventured into gas utilisation.

    “Most Nigerians have switched from kerosene to liquefied petroleum gas (LPG), which is the future of the world. I want to assure Nigerians that a lot has been done by the government to ensure that gas utilisation comes to stay. If you go to Benin we have Compressed Natural Gas (CNG) station selling gas as fuel to motorists, in Lagos also NIPCO has 5,000 metric tonnes of LPG.

    “We are trying to create awareness on the essence of gas usage, its advantages, and price benefit. We intend to close the bridge between gas availability and utilisation which we help us a lot in aforestation exercise,” Aminu said.

  • ‘Don’t politicise PIB’

    Some experts have blamed the oil industry’s woes on past leaders. They spoke at a workshop on the Petroleum Industry Bill(PIB), organised for members of the Lagos State Executive Council, Permanent Secretaries and other officials.

    According to an oil and gas expert, Dr Mohammed Ibrahim, the past leaders should be held responsible for the problems in the petroleum industry.

    He said the way Nigeria’s past leaders surrendered the sector to foreign domination has left the nation worse off than it was before hydrocarbon was discovered.

    The PIB, he said, was a step in the right direction, advising against its politicisation.

    He called on the National Assembly to scrutinise the bill and ensure that it does not tie down the economy to foreign partners.

    Ibrahim observed that 95 per cent of oil and gas players are foreigners whcih poses serious danger to the existence and stability of the nation. He added that the bill has been doctored to suit the interest of foreign players in the industry.

    He said Nigeria technically cannot be regarded as an oil producing nation given its operational system where 95 percent of operators in the upstream oil and gas sector are foreigners. The PIB is set to reform the oil and gas industry, he stated.

    The Commissioner for Energy and Mineral Resources, Taofiq Ajibade Tijani, an engineer, said it was important that officials are well informed about the bill and what it’s going to achieve.

    He said the state would soon be a major player in the oil and gas sector, and as such must educate its officials on issues and policies in the industry.

  • Firm raises $100m asset for growth

    An indigenous oil firm, Lekoil said it has raised $100 million to fund the completion of drilling and testing of the Ogo-1 well and sidetrack, as well as for the future development of its OML 113 license in Nigeria, the Managing Director, Olalekan Akinyanmi, has said.

    Akinyanmi said the Ogo-1 sidetrack well, which reached its total measured depth of 17,987 feet on October 6, has encountered hydrocarbon intervals in the same Turonian, Cenomanian and Albian reservoirs that were successfully drilled and logged at the Ogo-1 well during the summer, adding that results from the sidetrack so far indicate that a 280-foot vertical thickness gross hydrocarbon interval exists within the well. The partners in the license – which include Afren and Optimum Petroleum Development – believe that wireline data and testing of the sidetrack is necessary to define the extent of the hydrocarbon intervals.

    The nearby OML 113 licence – in which Lekoil agreed to buy a 6.5-per cent participating interest in September – contains the Aje gas and condensate field, which is located about 15 miles offshore Nigeria in water depths of around 3,000 feet. The field is estimated to have un-risked 2C contingent resources of 25.3 million barrels of oil equivalent attributable to it.

    “This equity raise reflects Lekoil’s success in implementing the strategy, set out at the time of our IPO in May this year, to build a business focused firm, with diversified interests in terms of exploration, appraisal and near term production,” he said.

  • Minister, PHCN workers disagree over severance pay

    Minister, PHCN workers disagree over severance pay

    •IFC: new power firms look good

    Disagreements have ensued over the payment of severance package to workers of the defunct Power Holding Company of Nigeria (PHCN) as stakeholders hold divergent views.

    According to the National President, Senior Staff Association of Electricity and Allied Workers, Bernard Okpara, the Minister of Power, Prof Chinedu Nebo’s claims that over 70 per cent of the workers had been paid was not correct.

    Okpara said over 55 per cent of the workers had yet to be paid, adding that the development contradicted the earlier agreement reached with the government

    The government, he said, reneged on its promise to pay the entitlements before handing over to the new owners.

    He also said the workers had yet to be paid pension, adding that those who retired recently have not also collected their gratuity.

    “These show that the government has not yet complied with the agreement it reached with labour to resolve all outstanding issues before handing over the companies to private investors,” he added.

    Also, the President, Senior Staff Association of PHCN Mr Godwin Ifenacho said the power distribution (DISCOs’) and generation (GENCOs’) decision to retain less than 40 per cent of the workforce of 48,000 was not good.

    The development, he said, suggested that many skilled workers would be thrown into the labour market.

    He said electricity generation and distribution were sensitive matters, arguing that people that are technically strong and experienced in this area should be employed.

    However, the Ministry of Power has promised that the workers’, entitlements would be paid.

    Its spokesman, Timothy Oyedeji, denied claims that the Federal Government was not ready to pay, saying the payment is being done in phases because of the large number of workers.

    He said: ‘’The delay in paying the entitlements of workers does not mean that government is not serious about the issue. Government’s money is not something that must be thrown about. The issue requires due process. Verification of workers’ data among other information is important, hence the decision to make payment in phases. Everybody would be paid. Even, if there is minor disagreement, it should be resolved in the interest of the country. It should not be used to undermine the privatisation process.’’

    The government, he said, privatised the power sector to make it work, adding that there was no ulterior motive behind it.

    Oyedeji said there were opportunities in the labour market, adding that the government is making arrangements to engage the workers where their competence is needed.

    In his own submission, the Director-General, National Electricity Regulatory Commission (NERC), Dr Sam Amadi, said the Commission has not received complaints on payment of severance package to workers of PHCN.

    He said none of the 14 Discos and GENCOS has petitioned the agency on the matter, promising that the commission will act accordingly if it received such petitions.

    NERC, he said, would rely on the terms guiding the sale of the companies to resolve such issues.

    The payment of emoluments of the defunct PHCN workers fall under the guidelines for the sale of the company’s assets which is not within the NERC’s purview, he said.

    Amadi said: ‘’Labour issues are purely transactional and not regulatory. They are issues that revolve around the Bureau of Public Enterprises (BPE), the privatised companies and the core investors in PHCN’s assets. However, if NERC receives any petition from any of the utility companies, the organisation will look at their licence, terms and conditions of operations. We are yet to receive petition(s) from any of them.’’

    Meanwhile, International Finance Corporation has predicted a better outlook for the 14 power firms.

    Its Director, Infrastructure Department, Bernard Sheahan, told The Nation that more local and foreign financial institutions would be comfortable dealing with the companies now that they have taken possession of the assets of the unbundled PHCN

    He said the assets inherited by the companies were financeable, adding that it would not be long before the companies start getting loans from credible financial institutions.

    It was wrong, he said, to conclude that the acquired assets are weak, arguing that many of them were still very strong. He stated that on the basis of this, the banks would carry out their investigations and see whether they can advance credits to the firms.

    ‘’ It is wrong to say that PHCN’s assets are old and not financeable. We have discovered that the assets are bankable, hence the decision to finance the power firms as part of our growth strategies for Nigeria,’’ he said.

    Sheahan conceded that company has been holding discussions with the DISCOs and GENCOs to provide long-term financing for them since thay have paid for the assets, and therefore need to look for more long-term funding for growth.

  • NIPCO begins stations remodelling

    Nipco Plc has begun rebranding of its retail outlets nationwide for optimum service delivery, Its Managing Director, Venkatapathy Venkataraman has said.

    The stations, he said, in a statement, were being remodelled in line with the international best practices in the oil and gas industry.

    Venkataraman said the exercise aimed at providing some value additions to motorists, aside from the conventional product dispense. adding that the development will increase the company’s share of the retail market currently put at about 10 per cent, as well as meeting the needs of its stakeholders.

    The exercise, which, he said, will be extended to the over 150 retail outlets of the company will make customers who patronise the stations enjoy fuel and non fuel related services.

    He said a unit has been put in place and charged with the remodelling with the ultimate task that clients get value for their fuel purchase and other services rendered at the stations through routine checks.

    On the Liquefied Petroleum Gas (LPG) Skids, Venkataraman said the company had deployed some across the country to bring gas close to the populace.

    He said the Skids have electronic filling machines and further helps to deliver accurate quantity of gas to buyers.

    He said Nipco has stock of all LPG accessories such as cylinders, ,burners ,regulators ,hose among others, as part of efforts to promote gas usage.

    According to him, the massive stocking of smaller size of cylinders with burners targeted at the low income group is one of the novels achievements of the organisation.

  • Seplat considers dual stock listing

    Seplat Petroleum Development Company a Nigerian oil firm that bought assets in the Niger Delta from Royal Dutch Shell Plc (RDSA), is considering listing shares on two stock exchanges, its Managing Director, Augustine Avuru has said.

    He said the development will help in growing the company’s operations, and make it compete well in the industry. “A dual listing remains an option for Seplat for equity-raising, It will be wrong of us to discuss anything that is still undergoing regulatory approval,” he said.

    Seplat plans a dual listing in Lagos and London.

    According to reports, Arunma Oteh, director -general of the country’s Securities and Exchange Commission(SEC), said in an interview last month that a dual listing planned by an oil exploration and production company she didn’t identify will be “defining” and may encourage others to follow. The other exchange expected this month. The company has a track record of acquiring fields from international producers and making them viable, she said.

    The Nigerian Stock Exchange (NSEINDEX) will target 500 companies over the next five years as Africa’s second-largest bourse seeks to reach a $1 trillion market capitalisation by 2016, Oteh said. Five companies are expected to start trading their shares by year-end, she said.

    The bourse’s all-share index has gained 35 per cent this year, the third-best performer in Africa. Oando Plc (OANDO), a Nigerian oil production company listed in Lagos and Johannesburg, has dropped 11 per cent this year on both exchanges.

  • Nigeria consumes 39.66m litres of petrol daily

    Nigeria consumes 39.66 million litres of Petroleum Motor Spirit (PMS) daily, the Minister of Petroleum Resources, Diezani Allison- Madueke has said.

    She said the volume of petrol consumption reduced by 34.17 per cent within a short period of time.

    Fuel subsidy, she said, has reduced by 59.05 per cent to N850 billion, adding that the government spent N5.27 trillion on petroleum products between 2006 and last year.

    She said: “As at December 2012, N5.27 trillion has been expended on products subsidy since the commencement of Petroleum Subsidy Scheme in 2006. A comprehensive reform programme put in place, under the Minister of Petroleum Resources, yielded outstanding results in 2012.”

    She said the industry reform was in line with the government’s transformation agenda to promote socio-economic activities.

    The reform initiatives, she said, are aimed at restoring effective product monitoring, enhancing transparency and accountability, restoring the integrity of the products importation and volume determination process, changing the negative perception of the sub-sector, especially of the Petroleum Product Price Regulatory Agency (PPPRA), among others.

    Mrs. Alison-Madueke said the reforms between 2010 and this year covered the downstream, midstream and upstream, among other areas in the oil and gas value chain.

    She said the ministry was repairing and upgrading facilities in the refineries and pipelines distribution network to sustain in-country product supply

    She maintained that the ministry would continue to ensure stable supply of petroleum product, effective and efficient administration of the subsidy programme which she said remains unsustainably expensive and increased domestic refining

    In addition, she said improvements in local capacity and indigenous participation in infrastructure investments had been vigorously pursued, saying the outcome had been in upgraded training facilities and increased regulatory compliance with local content requirements

    The ministry in line with the government’s drive in achieving the national aspiration of 40 billion barrels of oil reserves and four million barrels of oil per day production, including condensate, as captured in Vision 20:2020, has increased exploration activities in the offshore, onshore and Inland basins.

    Meanwhile, exploration has been stepped-up in the inland basins of Chad, Anambra, Benue and Bida/Sokoto/Dahomey, she disclosed.

    According to her, last year, 19 exploration wells were drilled comprising eight exploration wells in the JV and 11 wells (3 exploration and 8 appraisal wells) under the PSC. Also, 93 development wells were drilled including 55 development wells under JV while PSC delivered 38 development wells.

    Within the same year, 33 work- over wells were drilled consisting of 32 work-over wells under JV and one work-over well in PSC

    This increased exploration activity is reflected in acquisition of a total of 6, 102 sq.km of seismic data, including 818 sq.km acquired for FES operations in the Chad Basin in Phase 3, 4 and 5 combined.

    She said acquisition of 266sq.km of seismic data in the Phase 6 is ongoing by IDSL (a subsidiary of NNPC) in the Chad Basin.

    In addition, the ministry has also grown IDSL Land Acquisition capacity by additional three 100percent wholly owned seismic party crews, she said, adding that all these are in line with realising the objectives of the present administration.