The Nation Newspaper

Tag: Arco

  • ARCO: how to engage youths

    There is need for educational institutions in the country to blend their academics with non-curricula activities in order to turn out youths that are fully equipped with the modern day challenges.

    Its Group Managing Director, Alfred Okoigun, says this has become necessary to allow youths in such institutions to develop other latent talents aside academics that may prove crucial to their wellbeing and general growth of the country.

    He spoke during the official presentation of a bronze medal won at the last Olympic Games in Austria by Miss Joy Udo-Gabriel, at the corporate headquarters of ARCO in Lagos. He promised to sponsor more youths in the country to realise their dream.

    Joy, a student was sponsored to the Commonwealth Games by ARCO under the company’s student athlete scholarship scheme, in conjunction with Making of Champions (MoC), a group dedicated to discovering sports talents in the country.

    “If the youths are not properly directed, they become a big problem for the country.

     

  • ARCO versus GE

    •The multinational should pay the 150 Nigerian workers their due

    Since the nation passed into law the Local Content Act of 2010 as inspired by the Obasanjo administration, hope for more nationalistic tone to investment in the oil industry has worked against hope.

    The staff of two of the upfront unions picketed the offices of one of the world’s big multinationals over an act of injustice. The partisans of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and the Nigerian Union of Petroleum and Natural Gas Workers (NUPENG) was in rage in defence of fidelity on contract.

    They picketed the General Electric (GE) for failing to pay $1.2 million in back pay and entitlements to 150 ousted staff of an oil services company, The ARCO Group.

    The deal was not originally with GE, but with a company called NuovoPignone. Both companies were contracted as partners by the Nigerian Joint Ventures with foreign firms to maintain the OBOB/ Ebocha/ KwaleAgip plants in the Niger Delta.

    Not long after the agreement, GE gobbled up NuovoPignone. It became a partnership between GE and ARCO to maintain the gas plants. But GE, in a curious lack of faith, humiliated ARCO by making it a sub-contractor rather than partner.

    In spite of that, ARCO took charge of the plants during the rise of militancy in the region that frightened GE workers out of the region and country. ARCO never made any attempt to short-change or undercut the agreement because of the absence of their partners.

    Yet when peace returned, GE undermined ARCO and gulped up about 19 of ARCO’s valued staff. The half-hearted cooperation continued until the contract expired and GE, ARCO and tens of other firms had to bid for the right to maintain the gas plants again.

    ARCO did not win although it scored higher than Plantgeria, a firm pushed by GE and its collaborator AGIP. ARCO scored 8.1 and Plantgeria 6.05. In spite of that, ARCO’s offer to do the same job with about $37 million was not preferred to Plantgeria’s for $87 million.

    It implied ARCO had to lay off its staff. But they were supposed to be paid their fair share according to the agreement in the partnership. Hence, GE was supposed to pay $1.2 million to the workers. The Minister of Labour and Employment and other industry stakeholders were in a meeting that agreed that GE pay the 150 workers within 30 days.

    The GE has not abided by the deal. It was this frustration that led PENGASSAN and NUPENG to protest at GE offices in Port Harcourt and Lagos.

    The GE’s attitude comes from brazen connivance of Nigerian government and business classes who place filthy lucre over devotion to national esteem. It is also impunity from a foreign firm that looks down on a country that is not willing to abide by its own law.

    Oil firms have done a lot of damage to our country since we first struck oil in Oloibiri over five decades ago. Our people have lost their homesteads, farms have been sullied into slushy ruins, fishes have disappeared or died in the waters, the air has forfeited its purity to gas flares. This has meant our ways of life have yielded to unfruitful lifestyles as well as physical dislocations and diseases. These circumstances led to militancy whose devastations still rankle us today.

    GE’s attitude is just one of many unreported or undocumented violations of our laws and sovereignty. The National Assembly should step into the GE-ARCO matter and interrogate the fortunes of our local enterprises since we passed the local content law in 2010.

  • $2.2b lifeline: Arco praises Shell’s local content initiative

    $2.2b lifeline: Arco praises Shell’s local content initiative

    Arco Group Plc has described as the right step in the right direction, the Memorandum of Understanding (MoU) for a $2.2 billion contractor financing support signed with eight Nigerian banks by Shell Companies in Nigeria (SCiN) and its Joint Venture (JV) partner, the Nigerian National Petroleum Corporation (NNPC).

    The fund to be managed by the banks, is being set aside to provide loanable funds for Small and Medium-sized Enterprises (SMEs) to enable them finance projects being executed for  SCiN.

    Arco said it understands that the new scheme is an improvement on existing method of loan disbursement to vendors working with Shell companies in the country.

    “The MoU setting aside loanable funds for SMEs, is indeed a far-reaching move by Shell and NNPC to reduce to the barest minimum, obstacles to credit that indigenous companies in particular regularly face in the process of handling contracts for an oil major, such as Shell.

    “In our 36 years in business, we have always advocated for policies like this to accelerate in-country capacity growth in Nigeria.

    “Arco notes with satisfaction that Shell has been undertaking several initiatives in recent years in order to, on its own part, give effect and lend credence to the Nigerian Oil and Gas Content Development Act of 2010. For us in Arco this is a very strong indication of Shell’s support for local content law. It is an indication by Shell to genuinely develop local capability in the country,” the firm said in a statement.

    Arco’s Group Managing Director, Alfred Okoigun had commended Shell for being active in supporting local content law in Nigeria during a dinner at the oil and gas conference in Abuja in March 2014, saying that examples of what the company was doing on the growth of local capacity were all over the place in the oil and gas industry in the country.

    “We see this initiative by Shell as a commitment to identify with Nigeria at this critical period of recession; we expect all the oil majors in Nigeria to emulate this giant step by Shell and NNPC because such a move is a win-win situation for all the stakeholders in the oil and gas sector in the country. The indigenous SMEs in the sector would have been properly empowered to deliver on the contracts awarded to them. The oil major would be able to make realistic forecasts on execution of its contracts.

    “The eight banks involved will be in brisk business with minimum risks. Availability of funds for contract execution in the oil and gas industry will reduce the current financial stress being experienced in the sector. Meanwhile, more employment would have been generated and the economy should be the better for it on the long run,” Arco said.

    Arco enjoined all the parties to the MoU to make deliberate efforts to ensure that the initiative takes firm root and becomes a norm in the oil and gas business in Nigeria.

    It said while the banks should anchor their own side of the business according to the letters and the spirit of the MoU in particular and the objectives of the local content law in general, it will be up to companies that will benefit from the scheme to justify the confidence reposed in them by being diligent and timely in the execution of contracts awarded to them.

    “In fact, the action being taken by SCiN and NNPC ought to be the template for contract execution in the oil and gas sector in Nigeria,” it added.

     

  • ARCO vs AGIP: Court won’t grant firm’s reliefs

    The Federal High Court, sitting in Port Harcourt, the Rivers State capital, has failed to grant any of the reliefs sought by ARCO Group Plc in a suit it filed against Nigerian Agip Oil Company (NAOC), NNPC/NAPIMS Joint Venture partners, as well as Nigerian Local Content Board, on the provisions of Oil and Gas Local Industry Development Content Act.

    ARCO, an indigenous engineering firm, participated in a bid for a contract to service Agip Gas turbine facility at OB/OB, Ebocha and Kwale, all in Omoku, Rivers State.

    The company allegedly scored the highest mark (8.6) in the technical demonstration and ownership over nine other competitors, thereby winning the contract by merit, in accordance with the provisions of Section 3(3 and 2) of the content law.

    But Agip gave the contract to another firm, PlanGeria, on the ground that it won the commercial aspect of the bid.

    Efforts to make Agip reverse the contract failed. ARCO sought the legal interpretation of the section of the content Act and several reliefs in court.

    The appellate court did not grant ARCO’s reliefs.

    Its lawyer, Beluolisa Nwofor, a Senior Advocate of Nigeria (SAN), said the company would appeal the judgment.

    He said the judge made an error but hailed him for being the first judge to interpret the local content Act since it was enacted in 2010.

    Also, AGIP’s lawyer John Ilerimie said the provision of the Act was meant to protect the rights of Nigerians to compete for the award of certain categories of contract.

    “In this case, we demonstrated to the court that all the companies that went through the test were Nigerian companies which were certified by Nigerian Content Development Board to be Nigerian companies…”

  • Diversify economy with petrochemicals, Arco chief urges

    Diversify economy with petrochemicals, Arco chief urges

    Nigeria should give serious consideration to the petrochemical sector in its quest to diversify the nation’s economy, the Managing Director/CEO of Arco Group, Alfred Okoigun, has said.

    The Arco chief who spoke in Abuja at the annual conference of the Institute of Directors (IoD), said the call became imperative  given  the current economic crunch occasioned by the prolonged slump in oil prices that has  led to significant slump in Federal Government’s revenue.

    Okoigun, whose presentation was on: Refocusing Nigeria’s Economy through the Petrochemical Industry, said Nigeria should take a queue from other countries such as China, Saudi Arabia and Malaysia that placed emphasis on the development of viable and sustainable petrochemical industries in the distant past and even in the era of oil boom. He said today, they are the ones that are now enjoying the cushion effect of their far-sighted policy decisions and implementation.

    He said: “Even, Japan and India that are non-oil and gas producing countries had a head-start in the establishment of petrochemical industrial complexes to the extent that they have been posting huge revenues from local consumption and export of petrochemical raw materials and finished products. In spite of their situations, Japan is the world’s third largest producer of petrochemicals and chemicals with a history dating back as far as 1955. India in its own case, is the sixth  largest producer of petrochemicals in the world and holds the third position in Asia.”

  • Our success story, by Arco chief

    Arco Group, comprising Arco Petrochemical and Engineering, has raised a crop of indigenous engineers and technicians rendering maintenance services in the oil and gas sector as their foreign counterparts.

    Arco’s Chief Executive Officer, Alfred Okoigun, who stated this while conducting the Vice Prisent, Prof Yemi Osinbajo, round the firms Stand during the African Petroleum Congress and Exhibition in Abuja, said the company has over 400 indigenous engineers and technicians, among others in its employ.

    otherwise known as Cape VI was the visit of high ranking government officials and business moguls and other dignitaries to the Arco Stand at the exhibition hall of the Congress.

    Okoigun, told Osinbajo, who was accompanied by the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, that the one-man business he founded in 1980 has become a three-subsidiary organisation with Arco Group Plc as the holding company and among them employing over 400 Nigerian engineers, technicians and other professionals as well as ancillary staff.

    He said Arco’s aspiration has been to prove that Nigerians can maintain complex oil and gas equipment like rotating compressors, adding that the company has demonstrated that feat before.

    He said with its partnership with EthosEnergy, a world renowned maintenance engineering firm, Original Equipment Manufacturer in oil and gas, the oil  servicing company can undertake any task, no matter the complexity, “it can be maintained by the Nigerian engineers and technicians in Arco Maintenance and Engineering Limited.

    This  can be done at cheaper costs than what obtains at the present, he said.

  • ARCO chief seeks local participation in oil, gas

    ARCO chief seeks local participation in oil, gas

    The Group Managing Director of Arco Group Plc,  Alfred Okoigun has urged African oil and gas producing countries to make up for the lost time in the areas of local capacity building, equipment maintenance and manufacturing.

    In a presentation entitled; ‘Value Addition through Local Content in the Oil and Gas Industry in Africa during the African Petroleum Congress and Exhibition, also known as Cape VI in Abuja, he said the forum was an opportunity for him to share his experience of nearly 40 years in the oil and gas business with the participants.

    Mr. Okoigun said Africa accounts for 7.6 per cent of total global crude oil reserves and 9.3 per cent of the world oil production. The continent is also responsible for 14.6 per cent of the world liquefied natural gas trade. All these, he said still make Africa to be of strategic importance in the global oil and gas business.

    The Arco chief however wondered why African oil producers have just been satisfied with earning foreign exchange by selling oil and gas but have paid very little attention to using the God-given resources to maximum advantage as other countries outside Africa. He said the critical value additions in the oil and gas industry have always been local capacity building, the ability of each country to take control of equipment maintenance and even move up to the level of equipment manufacturing.

    He cited the experience of countries such as Malaysia, Norway and Brazil as early starters in the implementation of local content development policies in the oil and gas industry and expressed the view that African oil producing countries had not done well in that regard.

    Mr. Okoigun said right from the inception of oil prospecting and exploitation in Malaysia, its government had laid down the timeline for the International Oil Company (IOC) that was moving into the country’s oil industry to ensure that Malaysian nationals were trained to take over the duties of the IOC’s workers.

    He said today, Malaysia is an exporter of expertise in the oil industry. “African oil producers are just at the starting line,” he lamented

    In the case of Norway, he said the Norwagian government specifically issued guidelines and conditions such as formation of local companies, collaboration of the IOCs with the local companies and partnership between both sides in research and development (R&D). He said all the measures paid off for Norway’s local content development.

    The Arco cheif  said Brazil’s approach was to demand licenses for the local manufacturing of oil and gas equipment and the steps taken became a success story too.

  • Arco posts N6.41b gross revenue

    In spite of the challenging economic environment, Arco Group Plc posted impressive gross revenue of N6.41 billion in the year ended 31st March 2015.

    Its Board Chairman, Chief Joseph Akpieyi stated this in his address to the shareholders of the company at the 33rd annual general meeting (AGM)of the company in Lagos. The figure, he said represented 10.14 per cent increment over the preceding financial year’s performance.

    He also said total assets of the group increased from N12.09 billion in the year ended 31st March 2014 to N13.01 billion in the year ended 31st March, 2015.

    He said management would reposition the company to make it the toast of the industry in professionalism and financial performance.

    According to him, the implementation of the recommendations of Arco Strategic Enterprise Transformation Project known as Project ASET has given a new logo to the firm.

    Unveiling the new logo which is in bold red with a blue arrow pointing northwards, Chief Akpieyi said the logo represents Arco accent which is a celebration of the present achievements as well as an expression of hope for its future growth into a Nigerian conglomerate that will outlive its founders.

    He said: “We have long recognized that obtaining international ISO Certification will enhance our business and enable us to compete outside the shores of this country. We are delighted to report that subsequent to year end, our subsidiary, Arco Pipeline Solutions Limited which is ISO certified, secured a contract in the emerging oil and gas industry in Ghana. We believe that this is a great opportunity that will enable us to establish ourselves as a company of choice in the areas we operate in Ghana.”

    Another cheerful news, he stated is the ongoing process of re-engineering of Arco Marine and Oilfield Services Limited that will enable it to raise additional capital in for the purpose of supporting the increasing volume of business of the company.

    Taking a long term view of the oil and gas sector, he said Arco Group was evolving a policy that would focus on diversification of its revenue base from oil and gas sector to other sectors of the economy.

  • High Court orders status quo in Arco, Agip dispute

    The Federal High Court in Port Harcourt, the Rivers State capital, has ordered parties to maintain status quo in the suit filed by Arco Group Plc, against the Nigerian Agip Oil Company Limited and others.

    Justice Lambo Akanbi said nobody should take any action that could foist a state of helplessness on the court while the case is pending.

    He had adjourned till October 26 when he will determine his jurisdiction over the case.

    The Nigerian National Petroleum Corporation (NNPC), Conoco Philips Petroleum Nigeria Limited and the Nigeria Petroleum Investment Management Services (NAPIMS) are the other defendants in the suit.

    The plaintiff wants the court to determine whether, in view of the provision of section 3 (2) and (3) of the Nigerian Oil and Gas Industry Content Development Act, 2010, having demonstrated ownership of equipment, personnel and capacity to execute the task of performing the contract for the maintenance of equipment at Agip’s gas plants at OBOB, Ebocha and Kwale, it is entitled, being a Nigerian company, to the exclusive right to be considered and granted such contract, including any extension of its duration.

    Justice Akanbi had adjourned hearing on the application following a motion for extension of time by Agip’s lead counsel Chief Charles Ajuya (SAN), who is challenging court’s jurisdiction.

    Lead Counsel to Arco, former Nigerian Bar Association (NBA) president Chief Wole Olanipekun (SAN), reminded the court that it gave two rulings on June 2, one of which was that the first defendant’s counsel had not filed a memorandum of appearance before the court.

    He argued that the issue of appearance was critical and should be resolved first.

    When Ajuya said he had filed a motion asking for extension of time to file the memorandum of appearance, Olanipekun, who led Beluolisa Nwofor (SAN) and  Albert Akpomuje for the plaintiff, insisted the condition must be fulfilled first.

    “There is a condition precedent that must be fulfilled before the issue of jurisdiction can be raised either by the court or the defendant. I am only saying the defendant can’t be heard. We have not been served his memorandum of appearance. I want an even ground. I am not saying they should be shut out,” he said.

    The judge had asked both parties to maintain status quo until the determination of the matter.

    Explaining the directive to journalists, Olanipekun said: “The implication is that we should respect the processes that are before the court in the sense that when a court of law is seized of a matter, no party is expected to make an effort or any attempt at all to do anything that will negate what order the court will eventually make, or nobody should do anything at removing the res (subject matter of the suit) or touching the res; the res should remain intact until the court finally decides.

    “The res relates to the Nigerian Content Act, an indigenous content act, an act that is made to protect Nigerians. It is about preserving Nigerians who are protected by that Act.”

    Olanipekun told the court that the Agip had not served his team a copy of the motion seeking an extension of time to enable them to file memorandum of appearance.

    The judge, however, described Ajuya’s application as safe, saying: “It is a harmless oral application from the bar that all parties should remain where they are. I don’t see why all parties should not concede to this harmless appeal.

    “Counsels in this matter are accordingly advised to advise their clients to maintain status quo. Since nobody is doing anything to frustrate the matter, parties are advised to maintain status quo while the case is adjourned till October 26, 2015.”

    Arco is challenging Agip’s authority not to carry out NNPC’s directives that a stop-gap contract should be awarded to Arco for the maintenance of the OBOB, Kwale and Ebocha gas plants.

    NNPC, the majority shareholder of the NNPC/NAOC joint venture, had directed that the contract to Arco should subsist pending the conclusion of the processes leading to an award of a replacement  “four plus one-year” contract  for the maintenance of the gas plants.

    The plaintiff, a leading indigenous engineering maintenance and services company, is challenging Agip’s decision to award the contract to a company with alleged Italian roots and antecedents.

    It said the company had no demonstrable technical capacity or track record to execute the task, and had not shown that it owned the requisite equipment and Nigerian personnel for the purpose, contrary to the provisions of the Nigerian Local Content law.

    Earlier on June 2, the judge had struck out a preliminary objection by Agip . The  Justice held: “It is true that from the record of the court, the first defendant did not file a Memorandum of Appearance before filing the notice of preliminary objection.  The consequence is that they took that step in violation of the provisions of order 29 rules (1) and (2) of the Court Rules.

    “That is a defect which, in my respective view, is fundamental to the defendant filing their notice of preliminary objection.  The end result is to strike out the preliminary objection for being incompetent.”

    Having struck out Agip’s objection, the judge invited the parties to address him on whether or not  the court had  jurisdiction to entertain the suit. He ordered written addresses and adjourned the case to June 30.

    Olanipekun had expressed surprised that that  Agip’s counsel was yet to file the Memorandum of Appearance despite the ruling.

    He stated that one month had elapsed since the ruling, but no memorandum of appearance had been filed and served on Arco.

    The senior advocate said one month was enough to file a memorandum of appearance, adding that it would be an irregular procedure to allow Ajuya to address the court.

    Ajuya had informed the court that the business of the day was argument on the issue of jurisdiction and he was prepared to commence the proceedings.

    But Olanipekun insisted that entry of appearance was a fundamental issue which was not to be trivialised, and was a foundation of Agip case.

    After listening to both counsel, the judge ruled that compliance with the requirements of the court’s rules for filling a memorandum of appearance was a condition precedent for entertaining the address on the issue of jurisdiction, or indeed any other steps Agip’s counsel intended to take in the matter.

    Olanipekun then prayed the court to impress it on the parties that the status quo must be maintained.

    Ajuya urged the court to reject the prayer on the grounds that it amounted to a motion that had not been properly brought before the court and the fact that Olanipekun had also not brought any complaints against his client before the court on the issue.

    It was then the judge warned that he would not allow a situation in which any of the parties to the suit would take any steps, or carry out any acts capable of undermining the status of the case whilst a determination of the issue of jurisdiction was still pending.

    He, therefore, ruled that all the parties to suit must maintain status quo.

     

  • ARCO vs NAOC: Court fixes October 26 for hearing

    ARCO vs NAOC: Court fixes October 26 for hearing

    Justice Lambo Akambi of a Federal High Court, Port Harcourt, Rivers State, has adjourned till October 26, this year for hearing, the motion on jurisdiction in a case between Arco Group Plc and Nigerian Agip  Oil Company  (NAOC) Limited.

    Justice Akambi yesterday assumed jurisdiction to entertain the motion on jurisdiction by the defense parties.

    ARCO, an indigenous engineering company, in suit number FH/PH/CS/02/2015 filed before the court against NAOC, an Italian multinational company is seeking explanations from AGIP (NAOC) for violating the provisions of Nigeria Local Content Law.

    The plaintiff in the affidavit attached to the originating summons to the suit outlined the various ways the oil and gas giant has continuously and deliberately ignored, failed to reorganise the provision of the law in the award of contracts and purchase of equipment and parts, thereby short changing the government and indigenous companies in areas of its economy, capital flights, transfer of technology as well as unemployment.

    At the last sitting early June, the defence counsel, Charles Ajuya, a Senior Advocate of Nigeria (SAN), raised a motion to challenge the Jurisdiction of the court in the matter, insisting that the motion(on jurisdiction), be determined before the case could continue.

    But Wole Olanipekun (SAN) submitted that the defense counsel did not file a memorandum of appearance to enable him appear properly to challenge the court’s jurisdiction.

    The court struck out the defence application on jurisdiction with an order to the defendant to appear properly before him so that his application could be heard.

    The court urged Ajuya, to serve process to parties before yesterday’s adjourned date to enable him hear the application.

    However, the plaintiff was served with the memorandum of appearance during the court sitting. Olanipekun applied for time to study the document before making his arguments.