Category: Energy

The Hawilti, a pan-African investment research firm, has predicted that Nigeria could become biggest oil refiner in the region by 2025.

The prediction is coming as a surprise in light of the country’s longstanding struggle with shortage of petroleum products for its population. According to Hawilti’s recent report entitled: “Refineries watch Q4 2022”, Africa will witness significant transformations in its fuel supply security in 2023, as West Africa houses the largest refining capacity on the sub-continent, but only 23 per cent of it is currently operational.

The authors argue that the prospect of a new private refinery becoming operational in Nigeria could help redefine the nation’s local refining capacity. “Both the opening of the Dangote refinery and the rehabilitation of state-owned refineries have the potential to make Nigeria Africa’s biggest refining hub by 2025,” the report said. It further stated that the market is also driven by private oil producers and asset developers who are building modular refineries next to oilfields in the Niger Delta.

The Hawilti study also observed that historically, crude theft throughout 2022 has provided additional incentives for field owners to develop refining facilities and monetise their oil themselves instead of injecting it into third-party export pipelines. “2023 could see movement on several of them, including expansion plans at existing facilities,” it said.

The report also notes that the long-awaited Dangote Refinery is finally expected to start production this year and that its commissioning is already sending hopes that it could finally start rebalancing Nigeria’s trade deficit.

On top of that, Nigeria is also working on the rehabilitation of its three state-owned refineries in Port Harcourt, Warri, and Kaduna totaling some 445,000 bpd of refining capacity.

Ikeja Electric Plc (IE) has celebrated the Valentine Day with the Down Syndrome Foundation Nigeria in Fagba, Lagos.

IE’s Chief Executive Officer, Folake Soetan, said the company is passionate about impacting the environment where it operates through various interventions under the company’s Personal Corporate Social responsibility (P-CSR) initiatives.

According to her, beyond the   Valentine’s Day celebration, the firm has been showing love, care and, most importantly, make the people around her happy.

“At Ikeja Electric, the operational vehicle for our P-CSR initiatives is the Employee Volunteer Scheme which encourages our employees to partner the company in making considerable impact through charitable activities and voluntary contribution of their time and resources towards the progress of communities in which we operate. These humane and charitable acts reinforce our avowed commitment to “Giving Back Always” to the society at all levels,” she added.

Soetan, while presenting gift items, toiletries, foodstuffs and other consumables to the Foundation, expressed appreciation to the management of the Foundation for allowing the IE team to be part of a selfless service to humanity.

The founder of Down Syndrome Foundation Nigeria, Mrs. Rose Mordi, commended IE for expressing love, care and empathy towards those in need. She said her feelings was that most organisations do not think about the less privilege people, but IE has surprised her with their act of kindness. She encouraged others to emulate IE and she also promised to continue to be an ambassador of Ikeja Electric.

She exhibited some of the handmade crafts by the students as part of the Foundation’s entrepreneurship, skills acquisition and empowerment impacts to the visiting IE team and thanked the company for the visit while urging the management not to relent on the commitment to continuously show love to young and adult with down syndrome through her various CSR activities.

Egbin Power Plc, a member of the Sahara Energy Group, has inducted 27 young engineers after  completing the company’s Graduate Engineering Programme.

The graduates are the third batch of Egbin Power’s engineering trainee programme. The 12-month  programme, run in collaboration with Energy Training Centre (ETC), is for selected young engineers. It focusing on processes, procedures, and operations of the electricity supply industry.

It involved a blend of learning approaches; instructor-led classroom sessions, virtual sessions, field practical sessions to ensure effective learning transfer as well as improve their capacity and practical field experience.

Group Managing Director, Sahara Power Group, Kola Adesina, described the programme as a critical intervention in building capacity of technical manpower with requisite skills for infrastructural and human capital development of the power sector.

He noted that investment in new technology, expansion initiatives and innovative achievements at Egbin Power requires human capital profile to ensure optimal performance and profitability of the plant.

“Employment has been a challenge in this country, so this initiative helps us bring in more young people into the business and equip them to add value.

“We are looking to continually bring in value-adding personalities and we have, no doubt, that these crop of young talent will add value to our asset and, ultimately, assist in resolving the power challenges we have been experiencing in the last 63 years,” he said.

The Chief Executive Officer, Egbin Power Plc, Mokhtar Bounour, noted that investment in people is the key to success in any organisation and reiterated the commitment of the company to provide all the support the young Engineers require to make the difference. He also tasked them to ensure that they always push the limits and always remain innovative.

“We are very proud of the progress our trainees have made and we believe that they are now well-equipped to make significant contributions to the power sector. These are the future leaders and they deserve to be supported. We believe in them and we are counting on them to make a difference in bringing energy to life responsibly, “Bounour said.

The facilitator of the programme and Managing Director of Energy Training Centre (ETC), Ibiene Okeleke, said the learning academy gave the trainees access to top-notch learning facilities and curriculum delivered by a faculty of subject matter experts.

She said: “As one of Nigeria’s foremost learning institutions, these young graduate Engineers under our tutelage have gained extensive knowledge of the power sector. We look forward to seeing them solve the power challenges we face as a nation.”

One of the beneficiaries, Miss. Eseoghene Agbadudu, said: “It is a fulfillment and an achievement for me. We had the opportunity to be exposed to both the Technical and Commercial aspects of the Power Sector. So I hope to put all these learnings into play at Egbin Power, in bringing innovative ideas that can help improve the power sector.”

Petrol scarcity has gradually become a weapon deployed by marketers to demand and effect pump price hike through the backdoor. Would an ideal enabling environment capable of creating a free market in which demand and supply determine fuel pump price resolve this? MUYIWA LUCAS asks.

Petrol price increase from 1973 till date

Year Old Price New Price
1973 6k 8.45k

1976 8.45k 9k

Oct 1,1978 9k 15.3k

Apr 20,1982 15.3k 20k

Mar 31, 1986 20k 39.5k

Apr 10, 1988 39.5k 42k

Jan 1, 1989 42k 60k

Mar 6, 1991 60k 70k

Nov 8, 1993 70k N5

Nov 22, 1993 N5 N3.25k

Oct 2, 1994 N3.25k N15

Oct 4, 1994 N15 N11

Dec 20, 1998 N11 N25

Jan 6,1999 N25 N20

June 1, 2000 N20 N30

June 8, 2000 N30 N22

Jan 1, 2002 N22 N26

June, 2003 N26 N42

May 29, 2004 N42 N50

Aug 25, 2004 N50 N65

May 27, 2007 N65 N75

June, 2007 N75 N65

Jan 1,2012 N65 N141

Jan 17, 2012 N141 N97

Feb, 2015 N97 N87

May 11, 2016 N87 N145

March 2020 N145 N125

June 2020 N125 N123.50

July 2020 N123.50 N143.50

August 2020 N143.50 N148.62

Sept.2020 N148.62 N153.86

Nov. 2020 N153 N165

2021 N165 N169

Jan. 20, 2023 N169 N185

In the last five months, Nigerians have had to contend with what may perhaps have been the longest span of petrol scarcity- at least, in recent times. Twice, last year, queues surfaced at the pumps, with the second spilling over till this week. The situation has thrown the country into chaotic situations taking a toll on the economy. On each occasion, the effect is that the pump price of the commodity skyrockets, though unofficially.

It was, therefore, not surprising that in the fourth month into the scarcity, pump prices of petrol increased from N175 per litre to between N185 and N195 per litre. This price though applies to only retail outlets owned by the Nigerian National Petroleum Company (NNPC) retail outlets (filling stations) and major oil marketers.

A tour of several filling stations by The Nation showed that a litre of petrol now sells for as high as N400 per litre in Lagos and N700 per litre in some hinterlands. This is in defiance to government’s directive on fuel pricing, which it still maintains has not changed from N165 per litre.

At some filling stations visited, including some NNPC franchisee stations across the state, the new price has since been displayed on their pumps- an obvious indication to the public that they are not perpetrating any form of illegality with the increase. The unilateral increase by marketers at this period remains shocking to the public considering that government has not pronounced such price increase. Even the regulator, the Nigerian Midstream Downstream Petroleum Regulatory Agency (NMDPRA), headed by Farouk Ahmed, has feigned ignorance  of such increase, insisting that prices are still the same.

The Executive Director, Distribution Systems, Storage and Retailing Infrastructure, NMDPRA, Mr. Ogbugo Kalu, at a briefing said the authority was ever ready to enforce the price on independent marketers who may have increased the pump price.

He warned marketers that they risk withdrawal of their licences if they sell petrol above the regulated price, adding that the authority was monitoring supply nationwide to end queues at petrol stations.

“We are monitoring the situation and discussions are also  ongoing. The authority has to be circumspect in wielding the big stick, otherwise the situation could exacerbate. However, the authority will not shy away from sealing depots and suspending licences, including total revocation. All these options are on the table and can be deployed at any time. Everybody that is operating within the value chain must be careful not to incur the wrath of the law. The authority sealed seven depots in the last few weeks for overpricing,” he said, adding that the Federal Ministry of Justice would gazette three new regulations, last month, to enhance the authority’s capacity to deliver on its mandates.

The President, Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Okoronkwo, blamed the high cost of logistics and the war in Ukraine for the development. In his own reaction to the sale of petrol above government approved price at some private depots and independent marketers’ filling stations, the National Operations Controller, IPMAN, Mike Osatuyi, said that such development is expected because some depots would have incurred extra costs to procure the product in their depot.

“Why won’t the private depot sell beyond the official price? Maybe they have incurred some extra cost in getting the product. It will shock you to know that some of my members don’t get the fuel supply for less than N270 per litre, so how much do you expect them to sell it. Anyway, if they are able to fast track the supplies, maybe by end of this week normalcy will return,” Osatuyi explained.

Sustainability

The issue of price remains a major source of concern. With the local currency, the naira, hitting an all-time low against other international currencies, the cost of doing business has risen astronomically. This has affected the operational cost of running depots and other ancillary services associated in the value chain line of petrol supply and distribution, including its storage.  For instance, the Depot and Petroleum Products Marketers’ Association of Nigeria (DAPPMAN) are lamenting that it has become very unsustainable to keep petrol at N165 per litre Petrol Pump Price.

Sources close to independent marketers and their retail outlets blame the increase in pump price at their stations to the hike in ex-depot price at the private depot from where they get their supplies. It was gathered that most private depot recently raised the cost of petrol from the approved N142-N145 per litre to N172/litre. This, it is believed, has accounted for why some filling stations owned by independent marketers sell fuel at N350 to N700 per litre, depending on the state as against the approved and regulated pump price of NN162 – N165 per litre.

According to DAPPMAN, the local running costs of operating their various fuel depots had gone up astronomically, adding that the petrol they supply was sourced solely from Nigerian National Petroleum Company (NNPC) Limited. It explained that this purchase was made by depot operators with funds sourced with high bank interest charges, alongside increased costs of hiring Daughter vessels, with which they deliver the fuel cargoes to their depots.

It also blamed the on-going Russian/Ukraine War on the high cost of operating in the sector, explaining that the international prices of these items had risen astronomically and had more than doubled their old rates since the beginning of the war, thereby causing extreme increases in local prices.  

“Depot Owners and the government have continued to struggle over time to sustain supply of PMS at the government regulated pump price of N165 per litre despite the huge subsidy cost to government and abysmal margins to the Depot owners. We also experienced astronomical increases in the cost of diesel used to power equipment and machinery in our various depots and our retail outlets,” the statement said.

Typical of the NNPC at times like this, the firm during this period has insisted on having more than enough reserve to serve the country. As at December 8, 2022, the NNPCL claimed it had 1.9 billion litres of petrol in its reserve.

NNPC also assured that it was working with the entire operators and stakeholders in the downstream sector to ensure that petroleum products get to distribution channels and filling stations across the country. “With all the apparatuses put in place, we can assure that all the fuel queues will disappear in the next few days. Nigerians will continue to enjoy the free flow of petroleum products,” NNPCL assured.

But what the NNPCL, as the sole importer of petrol has not made public is the reason for the supply shortage which marketers have blamed the NNPC for. IPMAN’s Chairman of Lagos Satellite Depot, Mr. Akin Akinrinade, had lamented the shortage of petrol in their depot, informing that since December 2021, not a litre of petrol had been lifted at the NNPC satellite depot at Ejigbo. The situation had put independent marketers at the mercy of private depots, whom he accused of hiking their ex- depot prices to a level no longer sustainable to sell petrol at N165 per litre. NNPC’s silence on this issue has been deafening. Several efforts to get the company to respond has been met with stifling silence as its spokesman, Garba Deen Muhammed, did not respond to enquiries. Muhammed has always maintained deafening silence, not picking calls made to his mobile phone nor responding to text messages.

Silence

A code of silence has continued to pervade attempts to unravel who authorised the new N185 per litre petrol price.  Critical stakeholders who are supposed to know have continued to feign ignorance of the development as at the time of going to press last night.

For instance, sources at the NMDPRA also  feigned ignorance on the development. NMDPRA’s spokesman, Kimchi Apollo, could also not be reached on his mobile number for comments, just as the Executive Secretary of the Major Oil Marketers Association of Nigeria (MOMAN), Clement Isong’s mobile number was “not reachable,” at the time of going to press.

However, the National President, Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Okonkwo, in a telephone chat with The Nation, said he was in the dark as to the directive leading to the price hike.

“We have not been communicated by any official or regulator on the N185 per litre petrol price, so we are also in the dark on this like every other Nigerian; government has also not said anything about it openly. So I cannot comment on what I am not aware of; let’s wait until we have a clearer picture of the development,” Okonkwo said.

The development has fueled speculations that the Federal Government may have subtly begun the removal of subsidy on petrol and by extension, a complete deregulation of the sector, which for long has been the clamour of both MOMAN and IPMAN. In 2022, the Federal Government spent over N6.3 trillion on subsidy.

Okonkwo however said that the sector is still regulated, although the position of IPMAN is that there should be a level playing ground if truly government wants to deregulate the sector and not as it obtains now.

“For us as IPMAN, we are still in the regime of subsidy, but I tell you, deregulation is the way to go on this matter. We should pray for the availability of the product because when it is not available, you will be tempted to look for it in any way. The operating environment is very harsh even to NNPC because they import the product and dollar is increasing in value against the naira; everything around petrol is dollarised even for charges that we pay for locally like NIMASA and NPA charges. All the other costs associated with petrol are also charged in dollar. Government needs to remove the dollar business around petrol especially for those we can do locally; when this is done prices will also go down,” Okonkwo said.

The cost of fuel pump increased from N87 per litre as of December 2015 to N165.77 by December 2021, which is an increase of 90.54 per cent, according to the Fuel Pump Price Per Litre – Average (PMS) data from the Central Bank of Nigeria (CBN).

The Lagos State Ministry of Energy and Mineral Resources has taken its campaign against vandalism of oil and gas pipelines in host communities in Ejigbo, Egbe-Idimu, Alimoso and Oshodi-Isolo Local Development Areas (LCDAs), with a call on the citizens to be alive to their civil responsibility by keeping off vandals from the pipelines.

The stakeholders’ forum had as its theme: “Preventing Recurring Explosions and Vandalism of Petroleum Products Pipelines in Lagos State (Citizens’ Responsibilities and Engagements)’’

The ministry’s Director/Head, Oil and Gas, Mr. Odukoya Sesan, said the government embarked on the sensitisation to show its concern for the people in communities hosting oil and gas  pipelines to avoid their sleeping on their right, as the vandals would undue advantage of it and cause havoc to pipelines, adding that they are the ones that would be affected as, apart from deaths, the vandals leave in their wake damaged facilities, which must be repaired or replaced, thereby straining the government’s purse.

 Recalling that last year, an awareness programme was held in Ifako-Ijaiye community, he pledged the government’s support to the eradication of vandalism. 

Antiono Ayodele, a Deputy Director in the ministry, described the pipelines as the Federal Government’s infrastructure for ferrying petroleum products, to make their purchase easy. But instead of seeing them as such, some greedy Nigerians who have turned them into their honey pots, without caring about those they hurt or the environment they pollute by their illegal activities. He cited the fire incident from vandalised pipelines in Jesse, Delta State where many people died.

 Ayodele explained that the objective of the forum was to let the people know that it is their responsibility to protect what the government put in their environment by reporting strange movements along pipelines to government’s enforcement agencies and that protecting the pipelines and the petroleum products against attacks was the joint responsibility of the government and the people. He warned them against confronting the vandals as they could be deadly, but rather to report them only.

He charged the Community Development Areas (CDAs) and their larger Community Development Corporations (CDCs) to be on top of their games.

A representative of the Commissioner for Physical Planning and Urban Development, Mr. Odujebe Olalekan, who spoke on the appropriate Right of Way (RoW) for pipelines to adopt, said when building in such areas, the people must give a minimum setback of 15metres from the pipelines and they must obtain a permit from the ministry before embarking on a project. Anything less is illegal and should there be an incident, the victims would not be compensated, he added.

A representative of the Managing Director, Nigeria Pipeline Storage Company (NPSC)/Manager, Ejigbo Depot, Mr. Abiodun Folorunso Soboye, said they were in support of the campaign for the prevention of vandalism.”NPSC will continue to deliver on its services,” he said.

Deputy Superintendent Call (DSC), Nigeria Security Defence Corps (NSDC), Anayo Uchegbulam described vandalism of the pipelines as organised crime and that the relevant agencies of the government should unite to nip in the bud.

At the event were the Regent of Isheri Olofin, Aremo Balogun Kolawole; Chairman, CDC, Egbe-Idimu, Prince Jelili Olorunfunmi; Festus Todoweole of the Lagos State safety Commission; Richard Oluwatoyin Davis, an engineer, CSP Aderonke Bakare of Area M’ Command; and an Assistant Chief Fire Officer/Station Head, Ejigbo, Mr. Akeem Balogun, among others.

By Joseph Eshanokpe

Developing and maximising the gains of marginal oil fields were conceived to further boost the oil production capacity and, by extension, revenue earnings for the country. Sadly, achieving this has remained a major challenge. Efforts to set the operation firmly has yielded little results, notwithstanding its huge economic potential.This is why experts, at a recent gathering in Lagos, proffered the way out for the new licensees to make their operations successful. MUYIWA LUCAS reports.

The concept of marginal oil fields began in 2001 as part of the government’s policy to improve the nation’s strategic oil and gas reserves and promote indigenous participation in the upstream sector. It was also aimed at discouraging the continuous holding of undeveloped fields by International Oil Companies(IOCs) and create a leeway for indigenous operators to benefit from the sector.

But, 22 years after, the country cannot say much has been gained, especially looking at the inability to meet her Organisation of Petroleum Exporting Countries (OPEC) production output in over two years.

Notwithstanding its huge potential and economic benefit, much remains to be desired from its operations. Stakeholders have argued that the poor performance of the marginal field operators is due to certain challenges which have impeded their progress. They highlighted some of these challenges to include funding, technical, and public policy. Their situation is said to have been further compounded with the global emphasises on renewable energy and pressure to reduce carbon release into the environment.

But determined to ensure that the recent winners of marginal oil field licences get to work immediately, a professional services firm, PwC Nigeria, recently held an oil and gas stakeholders forum with the theme: ‘Marginal Oilfield Licence: After Winning, What Next?’

Partner, Energy, Utilities & Resources and Africa Oil and Gas Leader, Pedro Omontuemhen, explained the rationale behind forum: “Several new marginal oilfield licence holders who won the recent bid round are keen on moving ahead quickly in the journey to first oil. We aim to foster collaboration by bringing established industry operators to share their experiences and discuss best practices to enable the new players to succeed.

“Developing a marginal oil field is a capital-intensive project. Post the euphoria of winning, the next focus for new marginal oil field operators is to figure out how to achieve first oil production quickly whilst setting up a sustainable structure. We have financiers, producing marginal operators and other stakeholders in the room to provide insights on how to achieve this objective,” Omontuemhen said.

The Executive Commissioner, Economic Regulation and Strategic Planning, Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Dr Kelechi Ofoegbu, who represented Chief Executive Officer of NUPRC, Gbenga Komolafe, emphasised that the Petroleum Industry Act (PIA) is phasing out the Marginal Field regime with the objective of equalising oil and gas producers. The NUPRC is willing to support any innovative financing arrangements that the industry is evaluating and mediate any disputes among licence holders, he added.

Executive Vice Chairman, ND Western Limited, Dr Layi Fatona, advised new marginal oilfield awardees to manage their cost profile and focus on long-term success. He said partnerships were vital to achieving first-oil production timely. He advised marginal operators to prioritise human capital development and strategic partnerships.

Head Client Relations, Anglophone West Africa, AfreximBank, Peter Olowononi noted that based on clearly defined risk-management policies and procedures, the standard practice is to finance projects that are producing oil and gas.

However, Afrexim Bank recently adopted a different approach by working with some marginal field operators on a guarantee-backed facility based on technical expertise provided by competent oil service firms along with the equity contributed by the awardee.

The Managing Director and Co-founder of Subdrill Services Limited, Aysha Abba, highlighted the need for marginal field licence holders to demonstrate the commercial viability of their crude reserves in order to attract finance.

Going the extra mile by working with reserve evaluators to generate a Competent Person’s Report (CPR) can make a huge difference when seeking for finance or strategic partnerships. She recommended using industry-recognised experts to prepare field development plans, evaluate financing options, among others.

Stakeholders highlighted the need for a regulation that provides clarity and certainty to the issues facing marginal field companies. With the difficulty in sourcing funds internationally, marginal field companies were urged to focus on local market to raise finance, including ensuring that the Special Purpose Vehicles (SPV) to be adopted for their operations are structured in a tax and regulatory optimal manner, while marginal field operators should incorporate an ESG action plan into their operations to ensure easy access to scarce international funding.

Renewable energy plays an important role in meeting the needs of a country. Its development and proper use should be given high priority, especially with the current environmental issues plaguing the world today. AMBROSE NNAJi reports

Experts have predicted that the entire renewable energy ecosystem would attract double-digit percentage growth in the year. According to the experts, the renewable energy sector will continue to grow significantly with many of the programmes, forces and initiatives that have dominated the global and Nigerian energy space continue to influence the space over the course of the year.

 Afolabi Akinrogunde, Investment Manager of All On, an energy innovations firm, said the forces that would impact the fortunes of the sector in 2023 were varied – with some of them having either positive or negative effects on the sector. Some of these factors, he stated, include government policies and incentives, rising cost of energy, increasing energy demand, technological advances and use-cases for renewable energy to be scaled up in 2023, as well as international funding and partnerships.

 Akinrogunde who recalled the Nigerian government had implemented a number of policies and incentives to encourage the adoption of renewable energy technologies said it’s expected these would continue, even with a change in government later in the year. He said: “Whether they have new names or new approaches or themes, we expect government at all levels to continue to be a key force and player in the ecosystem”.

 The investment manager observed as the cost of diesel, petrol, kerosene, gas and on-grid power continues to rise across the world (Nigeria inclusive), it would make renewable energy sources much more cost-competitive and attractive.

 “At All On, we have seen a lot of small and medium scale businesses switch to solar in the second half of 2022, as diesel price went higher. Expect this trend to continue over the course of 2023 – especially if or when the subsidy on PMS/petrol is removed. Many more homes and businesses will run the numbers and make this year”, Akinrogunde contended. 

 He explained with one of the fastest population growth rates in the world at 2.4percent per annum, Nigeria’s energy consumption needs on a per capita basis is growing immensely. According to him, the current state of Nigeria’s energy delivery system as designed and operated is grossly inadequate to meet the needs of the growing population. “As this trend continues into 2023, expect people to look for and secure more sustainable and cost-effective means of energy supply – which will be a major plus for the renewable energy sector”, Akinrogunde stated.

 He recalled a few years ago,  that no less than 90 per cent most of the new renewable energy solutions deployed in Nigeria consisted primarily of minigrids, solar home systems, solar energy systems, street-lights etc. From 2022, we started noticing a focus on new use-cases for solar and renewable energy technologies being introduced.

 These included solar-powered irrigation solutions, battery-as-a-service models and other similar solutions. We expect many more of these solutions to be further expanded upon and deployed over the course of 2023 – as they serve to provide energy access in a different, cheaper and more sustainable manner. Akinrogunde disclosed new solar battery storage solutions were also coming on board, which should be expected to start making an impact on the Nigerian market over the course of 2023. These, he said, included solid-state batteries, sodium-ion batteries, flow batteries and supercapacitors.

 He noted many international organisations and governments were providing funding and technical assistance to support the development of renewable energy projects in Nigeria. These, he said, include entities like the World Bank, the African Development Bank, the USAID, FCDO, many foundations and other development finance institutions – all financing various critical work streams within the renewable energy space.

 He said working in conjunction with government agencies like the Rural Electrification Agency, the National Electricity Regulatory Commission and the CBN and others, it’s expected their impact would be felt further going forward.

 He observed the Nigerian power sector was an interconnected ecosystem, with all parties playing their own roles in the challenges facing the network. While there are capacity issues with the DISCOs, the transmission system we currently operate is archaic and not designed for modern energy consumption, while the government continues to consider non-core industry issues when implementing rules for the sector.

 ‘’We will need to see no less than four years of proper operation of the on-grid power sector in Nigeria before we can begin to have confidence from investors and have them bring in the much-needed financing into the space.

 ‘’As 2023 will be a transitional year for Nigeria, I do not expect to see any major step-changes that will result in permanent positive changes for the sector. Once a new government settles in and begins to fully implement its own vision for the sector, we may then begin to see some major changes from 2024’’.

 The Executive Secretary, Association of Power Generation Companies (APGC), Joy Ogaji, said the flow of money within the industry was the fundamental problem preventing Nigerians from enjoying continued and sustainable improvement in electricity supply and thus the gains of the Nigerian power sector reforms.

 According to her, the lack of electricity supply, occasioned by the limited power generation, as well as inadequate infrastructure, has remained a key growth constraint for the Nigerian economy.

 Ogaji urged the Federal Government to design incentives that would enable local and international private sector participants to bring in the needed investment. “The Nigerian Electricity Supply Industry, despite its huge potential, is yet to demonstrate sustainable returns to investors, across the electricity supply value chain. With Nigeria accounting for over 51per cent of West Africa’s over 400 million population, its products- services, agriculture, and industries can dominate the sub-region if well packaged and delivered to bring in the much-needed foreign exchange.

 According to her, the erratic and unpredictable nature of electricity supply has engendered a deep and bitter sense of frustration that is felt across Nigeria and its urban centres. Ogaji, who noted the outlook of the energy sector was very abysmal, however, said the forces that would shape the sector were sound corporate governance, transparent and apolitical leadership and coordination of the sector. Others are appointments based on merit and devoid of bias, sanctity to contract and strict adherence to obligations, market discipline, among others.

 Even as executive secretary expressed concern over the current challenges in the sector, she was optimistic that with the right leadership, the sector issues could be resolved.

Nigeria could attain 2.2 million barrels crude oil production level in 2023, but for the Organisation of Petroleum Exporting Countries (OPEC) oil production quota restriction, the group chief executive officer of the Nigerian National Petroleum Company, Mele Kyari, has said.

Mele Kyari, who spoke at the virtual Global UAE Energy Forum, said despite all odds, the country aims to produce 1.8 million bpd this year.

He said that Nigeria struggled to achieve its OPEC quota in 2022, stressing that the country had a “different challenge” from the rest of the world, as security issues undermined production.

“For us, we see a trajectory of restoring production, including condensates within the year definitely. And we believe that we can hit our target of 2.2 million barrels per day, although now our OPEC target is 1.8 million barrels per day. We know that it’s practical to do 2.2 million barrels per day.

“We took definite steps to increase production and this is paying off. Around July, our net crude oil excluding condensate came down to around 1 million bpd. That has been restored,” Kyari said.

According to him, the government has also taken very practical steps around pipeline security. In August 2022, a high-ranking Federal Government delegation struck a deal with a former militant-turned security contractor, Government Ekpemupolo, also known as Tompolo, to crack down on oil theft.

“It’s practical to hit 2.2 million bpd in 2023, this is practical. It’s a moving target,” Kyari said, adding, “There are a number of projects that I have clear line of sight that can come on board in 2023.”

Also speaking on the controversial petrol subsidy regime in the country, Kyari explained that the NNPC’s relationship with the government as of today is strictly on a commercial basis.

“NNPC has become a completely private company today. Yes, owned by the government, but it’s operating like every other company today, like Shell, Chevron and any other company you can think of in our country.

“And therefore, our relationship with government today in terms of supply of fuel is on a commercial basis. There’s a service-level agreement between us and the government to supply fuel and sell it at a price that the policy decision has asked us to do.

“So, it’s not a problem for us at all as a corporate entity. It’s a value for us and we are delivering products to the country. We have the sufficient cash flow to support this and there’s a relationship between us and the government. We don’t see any challenge delivering any product into our country,” the GCEO reassured.

Kyari reiterated that work was underway to return the country’s four existing refineries to a point where they can help meet local demand, while the new Dangote Refinery is due to start up mid-year.

He stated that when these facilities come on stream, Nigeria’s national capacity would be around 1.1 million bpd.

“When we do this, we will exceed our national demand, so there will be a reversal of flow, with Nigeria becoming an exporter of products,” the NNPC boss predicted.

Insecurity and lack of investment have been the bane of Nigeria’s oil production. But the government now getting serious with tackling insecurity, the obvious result was the increase the December production. Although still significantly lower than the roughly 1.8 million bpd OPEC allocation to Nigeria, it showed that crude oil production increased from 1.18 million bpd in November. The output will be the highest production level since March 2022 when the country’s production averaged 1.237 million bpd. Nigeria has been able to meet its OPEC production quota for over a year.

Chevron Nigeria Limited (CNL), operator of the joint venture with the Nigerian National Petroleum Limited (NNPC), has said it has no plan to exit the country, contrary to a report in the media.

In a statement by the General Manager, Policy, Government and Public Affairs Chevron Nigeria Limited, Esimaje Brikinn, the company stated that it has demonstrated this by its investment in the country.

In the report, Chevron was said to have indicated that new investment plans announced by the top oil major, confirmed insinuations indicating the multinational’s exit plan from the country. The report quoted Chevron as saying that it will use 70 per cent of its capital allocation for production on oil fields in the United States, Argentina and Canada and reining in investments in large international oil projects as wells as focusing more on investing in the Americas.

But describing the imputation alleging that it plans to exit Nigeria as ‘misleading’, Chevron urged the public to “note that the allegation is untrue and does not represent the position of Chevron in Nigeria.”

“CNL remains committed to sustaining the existing mutually beneficial and long-term relationship with Nigeria and other stakeholders as demonstrated by our significant economic and social investments in Nigeria over the last six decades.

“These investments have generated visible and viable socio-economic development in several communities across Nigeria.

“CNL will, along with industry peers in Nigeria, continue to engage the government on policies and opportunities to ensure global competitiveness and sustainability of the petroleum industry,” the statement added.