The Nation Newspaper

Category: Energy

  • ‘China’s oil appetite under-estimated’

    ‘China’s oil appetite under-estimated’

    A surge in Chinese buying of blending fuels means oil demand in the world’s biggest importer is likely bigger than the official figures indicate, according to the trading arm of refining giant Sinopec.

    Chinese fuel consumption was already back at year-earlier levels in May, Fairy Wang Pei, head of the research and strategy department at Unipec, said at the Platts APPEC 2020 conference.

    However, purchases of light-cycle oil and mixed aromatics, which aren’t recorded in the crude import data, mean the nation’s demand recovery might be even more impressive than thought, she said.

    Oil buying by Chinese refiners has played an outsized role in supporting global prices this year, with Asia’s largest economy emerging from the coronavirus as Europe and the U.S. went into lockdown. Purchases have slowed from a peak in June though — amid port congestion and independent refiners running out of quota — and are forecast to remain sluggish this month.

    READ ALSO: IEA revises oil demand forecasts

    Chinese imports of mixed aromatics – used for blending into gasoline – have doubled in the first seven months of 2020 from a year earlier, Wang said. Purchases of LCO, used to make diesel, have risen by 115per cent and cutback asphalt shipments have surged almost 800per cent, she said.

    Oil demand in China was 3.5per cent lower in January through July from a year earlier, according to data from the National Development and Reform Commission.

    “China’s oil demand has recovered at a very fast rate,” Wang said. Actual demand is likely to be larger than the official numbers, she said.

  • IEA revises oil demand forecasts

    IEA revises oil demand forecasts

    By Lucas Ajanaku

    Oil demand in the year will decline by 8.4 million barrels per day (mbpd), according to the International Energy Agency’s (IEA’s) latest oil market report.

    The figure marks a slight increase from the 8.1mbpd drop forecasted in the IEA’s previous report, which was released in August. In its September report, the organisation noted that a resurgence of Covid-19 cases in many countries, local lockdown measures, continued teleworking and the weak aviation sector led to downward revisions of its demand estimates for the third quarter and fourth quarter of this year of 0.1mbpd and 0.6mbpd, respectively.

    Looking ahead to 2021, the IEA predicts that demand will grow by 5.5mbpd. Its previous report forecasted 2021 oil demand growth of 5.2mbpd. The IEA noted in its September report that China continues to recover strongly while India is showing renewed weakness.

    “The uncertainty created by Covid-19 shows little sign of abating,” the IEA stated in its latest oil market report.

    “As national lockdowns eased there was an initial sharp recovery in demand led by gasoline, but the curve has flattened out and it is becoming increasingly apparent that Covid-19 will stay with us for some time,” the IEA added.

    READ ALSO: The needless furore over fuel subsidy removal

    “With the on-coming northern hemisphere winter, we will enter uncharted territory regarding the virulence of Covid-19. In last month’s report, we said that the market was in a state of ‘delicate re-balancing’. One month later, the outlook appears even more fragile,” the IEA went on to say.

    Commenting on the IEA’s latest oil market report, Michael Burns, an energy partner at law firm Ashurst, said: “The impact of Covid-19 on the global economy is more sustained than could have been predicted six months ago.”

    “We are not out of the woods yet, but governments and industry have started making plans for a post-Covid-19 economic recovery, meaning that while conditions for the oil and gas industry are still challenging, there are signs of more optimism and pockets of activity, which will hopefully increase over the coming months,” he added.

    As of September 15, there have been 29.1 million confirmed cases of Covid-19, with 926,544 deaths, according to the latest information from the World Health Organisation (WHO). The worst affected region as of September 15, in terms of confirmed cases and deaths, is the Americas, WHO data shows.

    The IEA oil market report is one of the world’s most authoritative and timely sources of data, forecasts and analysis on the global oil market, according to the IEA. August’s report saw the IEA’s first oil demand downgrade in several months, which the organisation said reflected “the stalling of mobility as the number of Covid-19 cases remains high and weakness in the aviation sector”.

    Created in 1974, the IEA works with governments and industry to shape a secure and sustainable energy future for all, according to its website. Based in France, the organisation is led by Executive Director Fatih Birol.

  • ‘Deregulation, new gas policies will boost refining capacity’

    ‘Deregulation, new gas policies will boost refining capacity’

    Nigeria can develop into a refining hub for West and Central Africa and  become a net exporter of refined products, following government’s new policies on alternative energy, total deregulation/liberalisation of the petroleum downstream sector, and the coming on stream of new modular refineries, Major Oil Marketers Association of Nigeria (MOMAN) has said.

    Its Chairman, Mr. Tunji Oyebanji, also said Nigeria could go big on alternative energies such as gas and solar energy, adding that the country must gird its loins to ensure that these green alternative energy sources were strategically developed and their usage deepened across the country for the benefit of Nigerians.

    He said there must be cheaper and cleaner alternatives to petrol and diesel available to the public, especially as full deregulation of the petroleum downstream sector has commenced.

    He hinted that the association was  supporting the gas initiatives of the Federal Government and keying into the auto gas space to give Nigerians a cleaner and greener alternative to power their autos, homes and other equipment.

    Oyebanji said: “The idea of deepening the use of gas comes at a very auspicious time as we grapple with increasing (PMS) petrol prices due to the deregulation of the downstream sector.”

    The marketers said, in support of the government’s new energy strategy, they organised the Nigerian Compressed Natural Gas Webinar, in collaboration with Oil Trading and Logistics (OTL) Africa Downstream and ARS Conference Services, with key stakeholders in the oil and gas sector in attendance.

    The event unveiled gas as a cheaper and greener replacement fuel for automobiles and dissected the spectrum of its untapped potential across the downstream energy value chain, spelling out opportunities for the government, investors, and consumers.

    They also said the webinar reinforced the government’s commitment to the gas deployment strategy, addressed issues around policy framework, infrastructure, sustainability, and usability.

    According to the marketers, the  need to develop CNG (compressed natural gas), LPG (liquefied petroleum gas) and LNG (liquefied natural gas) as alternatives to petrol and other fuels has never been more critical, especially with the recovering crude oil prices and the rising demand for refined products as we approach the winter months in Europe.

    “Using other countries where gas has been adopted and integrated as an alternative auto fuel as case studies, gas requires government support and interventions to take root. The gas value chain is awash with opportunities for new investment, skills development, and enhancement of our local public transportation infrastructure.  Clear policy directives and legislative framework aimed at generating demand, as well as Customs duty and tax waivers will be required and fast-tracked to jumpstart the sector and attract investment into the gas space,” MOMAN said.

    The National Gas Expansion Programme (NGEP) has further engaged stakeholders across the energy value chain to push the government’s gas agenda following its stakeholders’consultative webinar in association with MOMAN and DAPPMAN.

    “In essence, the NGEP is bringing together all relevant government agencies to ensure that the gas space is business-friendly and conducive enough to encourage new investors into the sector. Nigeria, being a gas country must be able to benefit locally from its abundant gas reserves and transfer the advantages to the consumer,” he said.

    At the webinar, Dr Mohammed Ibrahim, Chairman, NGEP, also said the promotion of gas as replacement fuel will save Nigeria the much-needed foreign exchange expended on refined petroleum products import.

    He said: “The NGEP is a programme put in place by the Minister of State for Petroleum Resources, Chief Timipre Sylva, in furtherance of the domestic gas expansion programme of the current administration.

    The programme is designed to reinforce and expand domestic gas supply and stimulate demand in the country through the effective and efficient mobilisation and utilisation of all available assets, resources and infrastructure in the country.

    The deliverables of the programme include the development of a strong domestic gas-based economy by leveraging on the nation’s abundant gas potential.”

  • Firm tackles energy crisis with solar-power solutions

    Firm tackles energy crisis with solar-power solutions

    Ibrahim Apekhade Yusuf

    At a time the nation’s energy crisis appears intractable, Koolboks Nigeria Ltd, is set to tackle the problem frontally with renewable and solar-powered solutions.

    Koolboks, headquartered in France and with footprints in other parts of the globe including Nigeria is already leading revolution within the solar-energy landscape.

    Giving insights on the range of products including cool chain stores during the maiden press conference in Lagos at the weekend, Ayoola Dominic, the CEO of the Group led other members of staff including Olalekan Agbaje, in-country engineers, Adelowo Adebumiti, Marion Okewih, during the virtual interactive session.

    According to Dominic, who doubles as the President, Co-Founder of Koolboks, Koolboks products aim to bridge the gap in the three basic needs of Nigerians, which are light, energy and refrigeration, saying that the Koolboks vaccine fridges, also come equipped with external LED bulbs to aid sight at night and other emergencies and also two USB ports to charge mobile phones.

    “It is designed with an advanced temperature monitoring system that enables the user to remotely access, monitor and control the vaccine fridge from anywhere in the world, even in rural areas with no GSM network coverage.”

    Expatiating, he said, the company’s new offerings hope to bridge the gap in the cooling system in the country.

    He explained that with a KoolHome Freezer, those in the business of needing a quality cooling system can go and sleep.

    “KoolHome Solar Freezer is equipped with an ice battery that can power the freezer for up to four days without power supply or sunlight. It is inbuilt with a lithium battery.

    “The freezer is unique in the sense that it has two USB ports for charging of phones and also has automatic switch between AC and DC, with a two 150W solar panel and it comes with as low as N14,179 installment payment with assets financing scheme with some of the banks for prospective customers and interested members of the public.

    READ ALSO: Entrepreneur makes case for solar energy

    “With two external LED bulbs, you are sure that even without power in the house, you can light up your apartment and it comes with installment payment and with three years warranty,” the President said.

    “This is a product that without power can refrigerate your food, drinks and medications for up to four days even in the absence of sunlight. Our mission is to make cooling affordable and accessible to everyone that needs it,” he said.

    Fielding questions from journalists, Dominic said their entrant into Nigeria’s market is strategic at this point in time giving the hike in electricity tariff announced recently.

    The market categories for the company, he said, is divided into three bands including: domestic users, commercial and healthcare providers as the case may be.

    The company currently operates from Delta State, Nigeria but hopes to make inroads across other parts of the country with the planned unveiling of the products formally by October-November later this year.

  • ‘Containing virus key to oil recovery’

    ‘Containing virus key to oil recovery’

     

     

    The global demand for oil has decreased sharply this year more than previously expected due to the coronavirus pandemic, and there are doubts about a recovery next year, which may make it difficult for the Organisation of the Petroleum Exporting Countries (OPEC) and its allies to support the market in the next stage.

    OPEC said in its monthly report that global oil demand will decrease by 9.06million barrels per day (bpd) this year, more than the 8.95mn bpd drop that was expected in July.

    The International Energy Agency (IEA) expects a decrease in oil demand in 2020 as well as in 2021.

    The IEA lowered its global oil forecast for the first time in several months, as the number of COVID-19 infections remains high, amid persistent weakness in the aviation, maritime transport and industry sectors, and expectations of a second wave in Europe, America and Asia in the fall of the year.

    The IEA indicated that it expects global oil demand this year to reach about 91.1mn bpd, reflecting a decrease of 8.1mn bpd on an annual basis.

    The revised forecast is 140,000 bpd lower than the previous forecast by the IEA.

    Bullish scenario: Continuous movement above $41.72 will indicate the presence of buyers and the recovery of demand, and this may lead to a rapid test of the secondary rise at $43.52, and exit from this level leads to an acceleration in the upward trend, but there is resistance to reach the price of $46.37 a barrel, due to the fluctuation in demand for oil, and rising oil stocks.

    Currently, the price of oil in China has increased due to the recovery of the Chinese market and the purchase of crude oil from America.

    Bearish scenario: While the continuous movement below $41.72 a barrel indicates the presence of sellers and ample supply, the target of the first downside in the price (go down) is a 50 per cent minor level at $39.27 and a minor low of $ 38.72.

    A break out of this level may lead to a further drop to $35.01 in the near term in anticipation of the deterioration in demand as a result of the second wave of the coronavirus pandemic and the closure of import and export ports as a result.

    Short-term expectations for oil: Limited trade during this period will likely lead to higher closures and lower demand for oil and petroleum derivatives. Therefore the market is trading in a range at low volumes.

    With the two main components of oil consumption still competing in the wake of the pandemic, it is difficult to build an argument for a breakout from the upside.

    Even the optimistic news about lower US production was not enough to push the price of oil to its highest level and hovered around $44.50 a barrel.

    Despite the US production cuts, Opec + is gradually raising production, which helps to increase global supply, so news of a drop in EIA production is not as bullish as was initially thought.

    Moreover, the ongoing demand uncertainty caused by the COVID-19 pandemic and the potential for increased global production could keep prices at an average of $ 44 a barrel.

    In the latest oil market report, the IEA indicated that the demand for crude oil this year is about 8.1mn bpd than it was last year, which is an amendment to the demand forecast for the reduction of 140,000 barrels daily.

    The global oil demand is expected to reach 91.9mn bpd in the year, down 8.1mn bpd, year on year, reflecting a halt in mobility as the number of COVID-19 cases remains high, coupled with weakness in the aviation sector, industry and fuel demand in general.

    On the other hand, OPEC also indicated bad news for the oil industry this year, as it confirmed that demand this year will be weaker than previously expected.

    In fact, it was moThe global demand for oil has decreased sharply this year more than previously expected due to the coronavirus pandemic, and there are doubts re pessimistic than the International Energy Agency, which estimated the demand loss for the year at 9.1mn barrels per day.

    OPEC now expects the global economy to shrink by four years this year, more than the 3.7per cent expected economic decline in month’s forecast, due to the additional negative impact of the pandemic.

    For its part, the IEA classified the demand for slow jet fuel as one of the main factors for the expected decline in oil demand.

    In addition to that, the uncertainty remains large surrounding the rate at which COVID-19 is spreading, meaning it is still unclear (until now) whether there will be a second global wave of infections or the recovery in the oil and gas market will continue.

    “We are arguing about the price of oil, supply and demand for oil in the next stage, and although oil stocks are high, the issue of oil price and recovery is a matter of timing, and obviously linked to the Coronavirus pandemic, global economic growth and fuel consumption,” a commentator told Gulf Times.

  • PIB to prioritise gas use, says Sylva

    PIB to prioritise gas use, says Sylva

    By Lucas Ajanaku

     

    The Minister of State for Petroleum Resources, Chief Timipre Sylva, said the proposed Petroleum Industry Bill (PIB) would ensure that the nation’s abundant natural gas resources are used to promote national development.

    Speaking during the opening ceremony of the Society of Petroleum Engineers (SPE) Nigeria Energy Industry Transformation Summit (NEITS), he added that, in collaboration with stakeholders, the Ministry would promote domestic utilisation of gas resources  to create jobs for the teeming youth.

    Also, the Nigerian National Petroleum Corporation (NNPC) urged stakeholders in the oil and gas industry to come up with innovative ways to reposition the sector for sustainability as the COVID-19 ravages the world..

    Its Group Managing Director, Mallam Mele Kyari, said industry players needed to set their eyes on a strategy that focuses on people, partnerships, profit and posterity.

    Kyari explained that the new normal era brought about by the virus has  more than ever, reinforced the need to upskill the human capacity within the industry for the next phase, and develop the capacity to attract, train and retain people in the sector.

    He spoke on the theme: “Changing Global energy landscape: Repositioning for industry sustainability” at the occasion.

    “There must be collaboration across different dimensions; government, industry, academia and, particularly, with the communities where we carry out our operations. The social license to operate is critical to the Industry’s long-term survival. Also, partnership among industry peers to chart new ways of resolving Industry challenges and preparing for tomorrow cannot be over emphasised. I am delighted the SPE provides such veritable platform,” the GMD said.

    He said for sustainability, industry players must learn to manage cost, improve efficiency and deliver required cashflow (margins) for reinvestment and expansion, stressing that without creating profit, “we wouldn’t be in a position to take advantage of the opportunities that keeps us viable and ready for tomorrow”.

    Read Also: Petroleum Minister inaugurates NCDMB new governing council

     

    Another key to repositioning  the industry for sustainability, according to the GMD, is for players to always act and take decisions with posterity in mind.“We must bequeath to the next generation a world worthy to live in. Our operations must therefore be carried out in a safe manner without adversely impacting the environment. As you know, most discussions around energy substitution or green economy stem from looking at the Industry as ‘dirty’ and ‘unconscionable’. It must be reiterated that our Industry remains the bedrock of modern human existence. We must therefore work to create a positive view if we are to remain relevant in the long run,” he said.

    Delivering the keynote address, the President, SPE International, Shauna Noonan, clarified that the concept of energy transition was not to wipe out fossil fuel but rather an aspiration for cleaner energy.

    She said the SPE, Nigeria Council, has a great role to play in reducing energy poverty, noting that energy transition was important for greater value in the global oil and gas industry.

    Earlier in his welcome remarks, the Chairman, SPE Nigeria Council, Mr. Joseph Nwakwue, said the society was ready to offer professional services and work with all stakeholders to move the industry forward.

    He said part of the society was focused on capacity building to develop the required skill set for the oil and industry operations, stressing that it was what informed the choice of the theme of the conference.

  • Much ado about tank farms

    Much ado about tank farms

    A parley involving the House of Representatives Ad Hoc Committee, residents of Ijegun-Egba-Kirikiri and Satellite communities and other stakeholders maybe a step in the right direction towards finding a lasting solution to the problems arising from the siting of petroleum tank farms in their communities, MUYIWA LUCAS reports.

     

    Their huge sizes are quite intimidating, yet several of these dot the skylines in the Ijegun-Egba-Kirikiri and satellite communities In Lagos.

    While these facilities remain a good source of revenue to drive the economy, for the residents, it is a kill joy as it portends a huge threat to their lives and properties.

    But a midpoint settlement seems to be on the horizon for the communities and the promoters of oil and gas farm tanks. The residents claim the tank farms are a nuisance to their neighbourhood, danger to public life, damage to public utilities like roads and other government facilities, including posing a serious health challenge to the existence of residents in the area.

    Following a petition by the residents for the relocation of the facilities from their environment, a House of Representatives Ad hoc Committee last week visited Ijegun-Egba-Kirikiri for an on-the-spot assessment of the tank farms and LPG facilities.The committee, led by Sergius Ogun, included the member representing Amuwo Odofin Federal Constituency of Lagos State, Mr. Oghene Egoh.

    Ogun said the purpose of the visit was to assess the impact of the facilities on the people and make appropriate recommendations to the House. He further noted that the exercise was also to verify the approvals the owners of the facilities obtained before constructing them as well as the safety measures put in place by the depot operators.

    The facilities visited in Kirikiri area included Techno Oil and Gas Depot, Bovas Depot, Index Petrolube Africa Depot, Fagbems Petroleum Depot, Chisco Energy Depot and Swift Oil Depot. Those inspected in Ijegun-Egba were Emadeb Depot, A. A. Rano Oil depot, Wosbab Depot, Mao Petroleum Depot, Rainoil Depot and First Royal Depot.

    A resident, who simply identified himself as Mr. Imitiri, regretted that the lackadaisical attitude of the owners ofthe facilities had degraded the area and taken it backwards.

    According to him, businesses are beginning to take a downward turn as most are closing their business and relocating to other areas because of the state of infrastructural decay in the community.

    Buttressing his position, Imitiri wondered why a certain firm recently inaugurated an LPG facility, with others on the queue.

    For instance, it was gathered that one of the major players in the petroleum product and LPG business, Techno oil, would be inaugurating its LPG facility. The site engineer, Yaro Balami, said Techno LPG was one of the new generation firms  with the best safety guidelines.

    The Managing Director, Techno Oil and Gas Company,Tony Onyeama, said his firm is more concerned about the safety and health hazards of the community, that is they are putting safety measures to contain whatever that may arise from spillage of explosion.

    He said his company had done lots of CSR services to better its host community. Similarly, the Chief Executive Officer (CEO), Emadeb Energy Limited, Mr. Debo Olujimi, while conducting the committee members round his 65 million-litre  facility, said it sits on a five-hectare land and was constructed in 2013.

    At a stakeholders’ interactive session, the Controller General of Fire Service of Nigeria, Alhaji Liman Ibrahim, said there was the need for establishment of a central fire service station in Satellite, Kirikiri and Ijegun-Egba communities to promote safety.

    Ibrahim, who was represented by the Assistant Comptroller-General, Abdulganiyu Jaji, promised that the agency would provide personnel to support the tank farm operators,  urging them to put in place the needed infrastructure.

    “Tank farm operators should focus on training of personnel and infrastructure. There is need for synergy between tank farm operators and Department of Petroleum Resources (DPR). In Apapa axis, there are some tank farms that are very close to the residential areas which the House of Representatives should consider critically,” Ibrahim noted.

    The Lagos State Commissioner for Town Planning and Urban Development, Lagos State, Idris Salako, expressed the dissatisfaction of the state government over the unregulated siting of tank farms in Lagos.

    According to him, eight years ago, the state government stopped giving approval for siting of tanks farm, except they are to be located at Ibeju-Lekki free trade zone.

    Salako, however, regretted that eight years on, the ministry has been inundated by complaints by host communities about the activities of tank farm operators, which prompted the state government to ask the ministry to engage the host communities on how to manage the situation.

    He said: “The tank farm owners should be responsive to the needs and plights of the host communities. Most of the tank farms at Kirikiri don’t have approval permits. The infrastructure of Satellite Town has been run down by the activities of tank farms. Even if the tank farm operators relocate to Ibeju-Lekki without proper planning, the whole thing will be a failure.

    “We have lifted the ban on construction of tank farms and we urge them to improve on their Corporate Social Responsibility (CSR). The Lagos State building agency is compiling lists of those who have approval.”

    The Deputy Director, Oil and Gas, Ministry of Environment, Nafiu Akinpelu, said the tank farms should upgrade their oil-water separating system.

    Akinpelu expressed the need for tank farms operators to have a global Memorandum of Understanding (MoU) on Corporate Social Responsibility (CSR) with the host communities.

    “There should have been an audit report that will cover a lot of issues, such as health and safety, agitation of the host communities not to sabotage the facilities,” he added.

    The Alahun of Imoore and Apapa Kingdom, Oba Taofik Akeju-Awojo, said the people agitating for the relocation of the tank farms did not want the community to move forward, adding that those writing petitions to the Federal Government do not want the community to develop.

    He added: “Since, the tank farms started operations in the communities, crime rates have dropped and employment opportunities have been created. If you move the tank- farms away, there will be untold hardship and poverty.”

    The Chief Executive Officer, Emadeb Energy Services, Debo Olujimi, affirmed that the tank farms in Ijegun community have created 3000 jobs, promising that they would do more CSR activities.

    He said the tank farms are worth over N400 billion.

  • How Nigeria’s power sector is constrained by funds, others, by Agusto

    How Nigeria’s power sector is constrained by funds, others, by Agusto

    Our Reporter

     

    From the time of the Nigerian Electric Power Industry’s (NEPI) privatization exercise in 2013 till date, the Industry has remained constrained by insufficient revenues, weak cash flows, high leverage and low liquidity due largely to unreflective tariffs and low generating capacity. While electricity demand is estimated at 25,790 megawatts (MW), the highest power generation has stagnated at about 5,375MW. Unreflective tariffs also impede the ability of the Industry operators to generate sufficient cash flows and heighten the liquidity challenges in NEPI.

    As a result, the Nigerian Electricity Regulatory Commission (NERC) has introduced several policies to curb some of these fundamental limitations such as the Meter Asset Provider (MAP) regulation which is a means to liberalise the distribution market while resolving the challenges surrounding estimated billing and collections. However, while NEPI’s end consumer rate is growing at an average rate of 75,000 new customers every month, metering penetration has decreased from about 45.3 per cent in January 2017 down to 40.6 per cent in December 2019. Inadequate metering and limited technology in remote meter monitoring continue to contribute to the electricity distribution companies’ (DisCos’) high loss levels.

    Agusto & Co expects a decline in collections in year 2020 given the significant slowdown in the economy following the outbreak of the coronavirus (Covid-19) pandemic with the attendant lock-down order imposed by the Federal Government on economic activities in H1’2020.

    Our pessimism for DisCos’ collections is based on several factors (outlined in the report) including the ‘no disconnection’ measure implemented by the DisCos during the Covid-19 lockdown period. We believe that the ‘no disconnection’ stance will affect internally generated revenues such as disconnection and reconnection fees. Moreover, NERC has commenced the enforcement of the minimum remittance order (which stipulates the minimum remittance obligation for a DisCo having adjusted for tariff shortfall).

    This order is expected to end the erstwhile discretionary remittance regime by DisCos and should constrain the DisCos’ earnings in the short term. Low remittance has adversely affected the ability of Nigerian Bulk Electricity Trading Plc (NBET) to honour its financial obligations to the GenCos as well as constrained the ability of other service providers such as NERC to perform their statutory obligations.

    Nevertheless, NEPI’s strengths include assured electricity power demand with Nigeria’s growing population, operators’ access to several intervention funds such as the Nigerian Electricity Market Stabilisation Facility (NEMSF), the Power and Airline Intervention Fund (PAIF) and the Payment Assurance Facility (PAF). The Nigerian Government’s financial support provided through energy programmes of the Central Bank of Nigeria (CBN) was estimated at ₦1.1 trillion as at December 2018.

    The Nigerian government also supports NEPI through the implementation of favourable policies such as the Power Sector Recovery Plan. In addition, Nigeria is blessed with abundant gas reserves, the largest gas deposits in Africa estimated at 201 trillion cubic feet (TCF) together with about 600 trillion cubic feet unproven gas reserves. The abundance of gas reserves if adequately explored should provide a sustainable pathway to electricity generation in the long term and reduce the level of repressed and unmet electricity power demand in the country.

     

  • FPSO to boost Anyala, Madu fields

    FPSO to boost Anyala, Madu fields

    Muyiwa Lucas

     

    THE Nigerian National Petroleum Corporation (NNPC) and First Exploration & Petroleum Development Company Limited (FIRST E&P) have received the Abigail-Joseph Floating, Production, Storage and Offloading (FPSO) unit.

    Prior to her sail-away, the FPSO underwent upgrade in Keppel Shipyard, Singapore, to meet specified standards. The partnership between NNPC, Department of Petroleum Resources (DPR), First E&P, Yinson and Keppel Shipyard, sources said, helped ensure critical pre-deployment for the FPSO were completed in time.

    As part of technology transfer, a team of young professionals were at the Keppel Shipyard. They will form an integral part of the FPSO team in the production phase.

    The FPSO is a 274-metre long converted Suezmax trading tanker. It is self-propelled with 11 cargo storage tanks, two slop tanks and six dedicated water ballast tanks, including beffore and after peak tanks.

    It will be deployed in the Anyala and Madu fields, offshore as part of OMLs 83 & 85 field development, Nigeria’s first indigenous integrated oil and gas project in the shallow offshore. The processing on the FPSO includes facilities for oil separation, stabilisation, produced water treatment, gas treatment and compression.

    Read Also: NNPC rakes in N92.58bn from products sale in May

    The processing and storage capacities are oil processing of 50,000 barrels of oil per day, produced water treatment of 20,000 barrels of water daily, gas handling of 39 million standard cubic feet  daily and cargo storage capacity of 700,000 barrels. The FPSO will be operated for First E&P by Yinson.

    The ongoing exploration in the Anyala Field is planned for seven  wells approved by DPR.

    The drilling uses Borr Drilling’s Natt rig. The batch drilling from the installed Conductor Supported Platforms (CSP) in Anyala field is a novel technology deployed in the Niger Delta Basin.

    Anyala field will be developed along with the nearby Madu field (OML 85) through a shared production facility. The produced oil will be processed through the Abigail-Joseph FPSO. Associated gas and non-associated gas developments will be integrated into a gas-integration hub designed to feed an export line for the local gas market.

  • Rainoil boosts LPG with 8000mt facility, trucks

    Rainoil boosts LPG with 8000mt facility, trucks

    Muyiwa Lucas

     

    RAINOIL Limited has built a liquefied petroleum gas (LPG) tank with capacity for 8,000 metric tons (MT) and a fleet of 40 LPG trucks.

    The LPG business, which will trade as Rainoil Gas, was inaugurated in Lagos by the Minister of State for Petroleum Resources, Chief Timipre Sylva, alongside the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kyari.

    Sylva described Rainoil Limited as a leading integrated company in the downstream, noting that facility is in line with the Federal Government’s policy and drive to maximise use of gas and deepening of consumption of LPG, that is, cooking gas.

    The minister applauded Rainoil for ensuring in-country utilisation and penetration of LPG, adding that the launching of the 8000MT facility and 40 LPG trucks would go a long way to realising the government’s objective of maximising value from gas and  jobs creation.

    The multi-product facility located at Ijegun, Lagos, the minister said, is in tandem with the vision of the government in making gas the preferred fuel.

    He said: “I am excited at what I’m seeing. Everything can speak for itself.  As you can see, energy is very important in the global economy and I am glad that Nigerians are playing key roles in the oil and gas industry.

    “Rainoil’s investment in gas development aligns with President Muhammadu Buhari’s agenda in the National Gas Expansion Programme (NGEP), adding that the government has declared 2020 as ‘the year of gas’ ”.

    He stated that the country has sufficient gas reserves to meet its energy needs and was happy to see Rainoil aligned with the governments drive to deepen LPG penetration and attain five million metric tonnes of LPG consumption by 2022.”

    Kyari, who lamented that Nigeria is a net importer of petroleum products, announced that NNPC is ever ready and willing to support the companies that are making effort in meeting the Federal Government’s developmental agenda.

    “We believe that gas is our next instrument for developing our economy, and we commend Rainoil in its effort in ensuring the use of gas in the country,’’ he added.

    The Group Managing Director, Rainoil Limited, Dr. Gabriel Ogbechie, said the decision to invest in growing the LPG sector started in 2018.

    According to him, Rainoil Gas will  meet the energy needs of customers at the retail end in the months ahead. There are filling plants in process where LPG could be supplied in cylinders to consumers.

    Ogbechie believes that the expansion of Rainoil aligns with the company’s vision and mission to proffer solutions to fill the voids in the  sector. ‘’

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    Nigeria has the fastest growing LPG sector in the world with a projected LPG market size of $10 billion, with the domestic demand seeing an increase of 40 percent. Rainoil Gas will support the Federal Government’s policy on deepening LPG penetration and will improve domestic consumption of LPG nationwide. The business will also increase domestic storage flexibility of LPG.

    ‘’Rainoil Gas will provide direct and indirect employment opportunities, including training, skills acquisition, transfer and enhancement.

    Its operations also have an added environmental protection benefit as it reduces gas flaring and encourages the use of cleaner fuels.

    He said Rainoil has grown over the last 20 years with three ultra-modern petroleum product storage depots of 50-million litre capacity each in Delta, Cross River and Lagos states; over 81 retail outlets across the country; a fleet of over 100 trucks for efficient delivery of products and one shipping vessel with a capacity of over 20,000Mt.