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Tag: Minister of State for Petroleum Resources

  • DPR outlines achievements

    The Department of Petroleum Resources (DPR) has unveiled its achievements targeted at boosting the industry and making its operations transparent and accountable.

    The achievements include the establishment of technologies that will track online/real time of production volumes from the oil fields, terminals, the vessels taking them out for exports and their destinations.

    DPR monitors 19 oil fields online.The technology enables the Federal Government to know oil production. It also tracks movement of vessels bringing in petroleum products and ensuring there is no round-tripping of imports and sharp practices which substantially push up the estimated daily fuel consumption in the country and the subsequent subsidy payment.

    Some of the achievements include early oil lease renewals and recovery of royalties as well as reduction of cost of crude production to make Nigeria be at the same level with other oil-producing countries that have reduced their cost of oil production, among others.

    Minister of State for Petroleum Resources Dr. Ibe Kachikwu, who unveiled the achievements in Lagos, said the technologies introduced by the DPR include the Crude Oil and LNG Tracking (COLT), adding that the achievements were worth celebrating.

    Kachikwu said the achievements were part of the results of reforms in the industry. He said: “I intervened with the approval of President Muhammadu Buhari to steward and supervise a lot of the interventions and changes in the oil and gas sector and the DPR and others have worked collaboratively with me in the last three and half years to see to some of the steps I have taken both the time I was the Group Managing Director of NNPC, but now I’m largely focused on the regulatory aspects of the sector.

    “My clear mandate when I became the Minister of State was to change the oil industry because we were deeply worried by what seemed like a value dip in the industry and the corruption that was all over the place and to track our resources, among others.

    “Therefore, we have launched a series of computer-based applications which will enable us to track volumes of crudes produced from various terminals and how those volumes or products are moved, whether they are going to vessels and where those vessels are going to. It is a vessel-tracking mechanism so that at any given point in time, you can tell on real time basis what the country has produced for the very first time. These applications will tell where the vessels have gone to in terms of export and say whether they discharge at the given points. We will also be able to say on forensic basis whether there are some suspicious movements of the vessels when they have products in them. We have also extended it to the downstream sector to capture everything that is brought into this country in terms of importation of refined products and track how they are distributed within the country. So, for the first time in this country, we have holistic IT data-based applications that enable us to do that.

    “We also launched the benchmarking system to track expenses and see how we can continue in our process to pull down the cost of producing oil in this country which is a major challenge for us. Given the oscillating price of oil globally unless we are able to do this, we produce all the oil and no make no money out of it. So, this is very helpful to us and we will be able to challenge the oil companies to match the very best practice internally and collectively match the best practices externally in terms of oil pricing. We have explained to you what we have done in terms of early renewals of oil leases and what we generated both in terms of forcing people to be concurrent on payment of outstanding royalties and what we generated in terms of current licences and early renewal basis.’’

    The minister added: “The few interventions that we have had include National Production Monitoring System (NPMS) which focus includes using online to gather data. We have been able to track online/real time data of what our productions are and so we are now in the position to say what the country’s production is. We have also had the COLT, which is basically tracking of crude oil and liquefied natural gas (LNG).”

  • DPR outlines achievements

    The Department of Petroleum Resources (DPR) has unveiled its achievements targeted at boosting the industry and making its operations transparent and accountable.

    The achievements include the establishment of technologies that will track online/real time of production volumes from the oil fields, terminals, the vessels taking them out for exports and their destinations.

    DPR monitors 19 oil fields online. The technology enables the Federal Government to know oil production. It also tracks movement of vessels bringing in petroleum products and ensuring there is no round-tripping of imports and sharp practices which substantially push up the estimated daily fuel consumption in the country and the subsequent subsidy payment.

    Some of the achievements include early oil lease renewals and recovery of royalties as well as reduction of cost of crude production to make Nigeria be at the same level with other oil-producing countries that have reduced their cost of oil production, among others.

    Minister of State for Petroleum Resources Dr. Ibe Kachikwu, who unveiled the achievements in Lagos, said the technologies introduced by the DPR include the Crude Oil and LNG Tracking (COLT), adding that the achievements were worth celebrating.

    Kachikwu said the achievements were part of the results of reforms in the industry. He said: “I intervened with the approval of President Muhammadu Buhari to steward and supervise a lot of the interventions and changes in the oil and gas sector and the DPR and others have worked collaboratively with me in the last three and half years to see to some of the steps I have taken both the time I was the Group Managing Director of NNPC, but now I’m largely focused on the regulatory aspects of the sector.

    “My clear mandate when I became the Minister of State was to change the oil industry because we were deeply worried by what seemed like a value dip in the industry and the corruption that was all over the place and to track our resources, among others.

    “Therefore, we have launched a series of computer-based applications which will enable us to track volumes of crudes produced from various terminals and how those volumes or products are moved, whether they are going to vessels and where those vessels are going to. It is a vessel-tracking mechanism so that at any given point in time, you can tell on real time basis what the country has produced for the very first time. These applications will tell where the vessels have gone to in terms of export and say whether they discharge at the given points. We will also be able to say on forensic basis whether there are some suspicious movements of the vessels when they have products in them. We have also extended it to the downstream sector to capture everything that is brought into this country in terms of importation of refined products and track how they are distributed within the country. So, for the first time in this country, we have holistic IT data-based applications that enable us to do that.

    “We also launched the benchmarking system to track expenses and see how we can continue in our process to pull down the cost of producing oil in this country which is a major challenge for us. Given the oscillating price of oil globally unless we are able to do this, we produce all the oil and no make no money out of it. So, this is very helpful to us and we will be able to challenge the oil companies to match the very best practice internally and collectively match the best practices externally in terms of oil pricing. We have explained to you what we have done in terms of early renewals of oil leases and what we generated both in terms of forcing people to be concurrent on payment of outstanding royalties and what we generated in terms of current licences and early renewal basis.’’

    The minister added: “The few interventions that we have had include National Production Monitoring System (NPMS) which focus includes using online to gather data. We have been able to track online/real time data of what our productions are and so we are now in the position to say what the country’s production is. We have also had the COLT, which is basically tracking of crude oil and liquefied natural gas (LNG).”

  • ‘Oil firms to refine 20% of crude output locally’

    THE Federal Government is considering a policy that will compel operators of major oil and gas exploration and production firms to refine 20 per cent of their oil production in-country, the Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu, has said.

    Kachikwu gave the hint at the groundbreaking ceremony of the 5,000 barrels of oil per day (bopd) modular refinery being developed by Waltersmith Refining and Petrochemical Company at Ibigwe field, Ohaji-Egbema Local Government Area of Imo State.

    The minister said the Federal Government would soon announce a policy to require operating companies to refine locally at least 20 per cent of the crude oil they produce, with the percentage graduating to 50 per cent in the next five years.

    “We have no option or we will consistently stay in the abyss of lack of processing while we export all the raw materials,” he added.

    The modular refinery project is being executed with 30 per cent equity financing by the Nigerian Content Development and Monitoring Board (NCDMB) and additional $35 million debt facility from the African Finance Corporation AFC). It is expected to start production in December 2020.

    Kachikwu said the Federal Government’s policy on modular refineries is an integral part of the 14-point agenda for reducing militancy in the Niger Delta region. The plan, he noted, is to set up modular refineries in oil producing communities and use them to create jobs and absorb the militants. “We would take some of the good skills sets they have, polish them and put them into the system,” he said

    According to him, 10 of the 38 licensed modular refineries had made appreciable progress in the development of their projects and the first one is expected to deliver products between December 2018 and January 2019. “From modular refineries, we will be able to process about 200,000 barrels of crude and put them into the system.”

    He said the Federal Government was engendering the establishment of modular refineries through the financing model being managed by the NCDMB and had also granted free custom duty charges and other waivers to enable the investors bring in their equipment.

    Kachikwu assured that the government remained committed to completing the revamp of the nation’s four refineries in Port Harcourt, Warri and Kaduna by 2019, with a target to process about 500,000 barrels of crude oil daily. He regretted that continued importation of refined petroleum products was costing the nation huge sums of money, describing it as a waste of foreign exchange and deprivation of citizens’ jobs.

    He said several investors were developing greenfield refineries that would culminate in about 1,500,000 bopd being refined in Nigeria in a few years, making the country the crude processing hub of West Africa and in control of some part of the East Africa market.

    “There is the Dangote Refinery in Lagos with the bumper capacity of 650,000 barrels; the Niger-Nigeria refinery that will refine up to 100,000 barrels; the AGIP one, which is a 150,000 barrels refinery that will be located in Bayelsa State and the one led by a Chinese consortium that we are finalizing, which would do a co-location. We have two co-location refineries possibilities, each of them promising 100,000 barrels.”

    The Executive Secretary, NCDMB, Simbi Wabote, said: “The Board’s decision to invest in the Waltersmith’s modular refinery is in line with our vision to be a catalyst for the industrialisation of the Nigerian oil and gas industry and its linkage sectors. We stand with the desire of the Federal Government to give effect to the recent pronouncements on the establishment of modular refineries.”

    He added that initiatives and partnerships like Waltersmith’s were needed to increase Nigerian Content in the oil and gas sector to 70 per cent within the next 10 years. “Beyond our interventions in the local supply chain for in-country capacity utilization, we have broadened our focus to include in-country resource utilization.”  He confirmed that the Board would consider more proposals in line with its published guidelines, stressing that the capacity of such modular refineries have to be in the range of 1,000 bpd to 5,000bpd.

    He confirmed that subsequent modular refineries that would be supported by the Board would have 70 per cent of its components fabricated in-country, adding that the contractor for the Waltersmith project was permitted to fabricate some of the components in Houston Texas, United States because this was the first time such a project would be executed in Nigeria.

    The Chairman of Waltersmith Refining and Petrochemical Company, Mr. Abdulrazaq Isa, said the refinery would contribute about 271 million litres of refined products including diesel, kerosene, HPFO and Naphta, yearly to the Nigerian economy, thereby serve as import substitution for meeting domestic demand for petroleum products, create direct and indirect employment as well as reduce the demand for foreign exchange to import refined products.

    He said the company had developed plans to increase the capacity of the modular refinery to 30,000 bopd to process additional products including petrol (PMS) and Jet Fuel.

    “We have already executed a memorandum of understanding (MoU) with PCC of China towards the installation of the additional capacity within three years, after the startup of the 5,000 bopd modular refinery,” he added.

  • Gas flaring: FG vows to begin revocation of licenses next year 

    …to launch Programme to attract $30b investments

     

    The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu’ Monday vowed that the Federal Government would from 2019, withdraw the licenses of oil firms that refuse to stop gas flaring in Nigeria.

    He dropped the hint at the 2018 Buyers’ Forum/Stakeholders’ Engagement that the Gas Aggregation Company of Nigeria (GACN) organized in Abuja.

    Read Also:NNPC sets 2020 deadline for zero gas flaring

    He added that the Government would launch the infrastructure improvement programme in November, which has the potential of attracting between $20 billion and $30 billion of investments into the petroleum industry and also help address the infrastructural deficiencies in the industry.

    The minister explained that there has been a Cold War between the Federal Government and the upstream oil companies as a result of gas flaring.

    He noted that while the government has been eager to bring the menace of gas flaring to an end, the oil firms are full of excuses for continuing the flaring.

    According to him, the bottom line of the disagreement the oil firms had with the government on ending gas flaring was cash call and money.

    He said, “Government wants to end flare, oil companies still give lot of reasons why flare cannot be ended. Bottom line is cash call and money. But the reality is that whether or not we deal with cash call issues, it is not an optional agenda, it is a compulsive immediate agenda. It is destructive to the populace; it is intolerable in developed country and it should not be tolerable here either.

    “Any oil company that cannot find a way to ending its flare ought not to be producing. And I have said to the Department of Petroleum Resources, DPR, beginning from next year, we are going to get quite frantic about this and companies that cannot meet with extended periods — the issue is not how much you pay in terms of fines for flaring, the issue is that you would not produce. We need to begin to look at foreclosing of licences. This is very urgent.”

    Kachikwu stressed that the quest to discourage gas flaring led the Federal Government to initiate the gas flare commercialisation programme.

    In addition, the minister disclosed that future renewals of oil and gas licences would involve the assessments of the gas components and gas flare rate of each company seeking renewals.

    “Some of the ones that have come recently for renewals have insisted that they are building massive gas processing plants  and we are going to follow this right through so that the supply obligation, the processing facility, the treatment of gas; their submissions  are very accurate and very aggressive,” he noted.

    Kachikwu further emphasized the need for a critical implementation of the Domestic Supply Obligation, which would be extended to Domestic Supply and Processing Obligation for both gas and crude oil, stating that the country needed to move away from the point of just producing these commodities, throwing it into the vessel and shipping it out, to the point of processing as much of it locally as much as possible.

    According to him, only through this would we be able to create more jobs, create better profit and returns on investments, achieve better pricing and address the challenges of local industries and industrialization.

    Also speaking, Managing Director of GACN, Mr. Morgan Okwoche, called for increased support for the company, while he highlighted the need for optimum collaboration among industry players in the development of the gas sector.

    He called on the DPR to expedite action on the issuance/renewal of the five-year rolling Domestic Supply Obligation, DSO, volumes which will help in effective project planning.

    In addition, Okwoche said, “I would like to see the non-existence of a Gas Distribution tariff model which is encouraging arbitrariness and monopolist behaviours which may hamper effective implementation of the network code is not addressed ultimately.”

  • Buhari welcomes moves to import crude from Niger Republic

    …Nigeria, Niger sign MoU

     

     

    President Muhammadu Buhari on Tuesday hailed the move by Nigeria to export crude oil from Niger Republic.

    He also welcomed the setting up of a refinery in Katsina state that will make use of “stranded crude” from Niger Republic.

    The two countries on Tuesday signed a Memorandum of Understanding (MoU) at the Presidential Villa, Abuja.

    Read Also:APC threatens expulsion for ministers who disobey Buhari

    At the ceremony, President Buhari thanked the Niger delegation for considering Nigeria as a partner on what he observed as a mutually beneficial strategic initiative.

    According to him, Nigeria and Niger have had excellent relations for several decades as neighbours sharing a long border with common cultural and historical ties.

    Nigeria, he said, sees the cooperation on crude oil export from the Republic of Niger and construction of refinery facilities in Katsina State as a “win – win” for both nations.

    He said: “The initiative will not only provide a reliable market for the stranded crude from the Niger Republic but will also provide petroleum products for Nigeria, as it aggressively pursues its aspiration on petroleum product self-sufficiency.

    “In addition, it is my hope that the current frontier exploration efforts in the Northern part of the country (Chad Basin, Gongola Basin, Sokoto Basin, Bida Basin and Benue trough) will also result in the provision of additional hydrocarbon inflow to the corridors of the proposed pipeline and a potential refinery around Kaduna axis.

    “I am happy that several productive engagements held between the Nigerian and Nigerien authorities have resulted in the positive agreements to progress with activities on this important project.

    “This project will be private sector driven with the full support of the governments of both countries and I am happy to understand that several expressions of interest from prospective investors are already being received,” he said.

    He also announced the setting up of a steering committee to be chaired by the Nigerian Minister of State for Petroleum Resources, Dr. Ibe Kachiku, while the alternate chairman is the Nigerien Minister of Petroleum, to provide strategic leadership, direction and governance oversight for the project.

    He also said that a Senior level Joint Technical Team has been selected based on competence to develop the implementation roadmap and strategy on both the refinery and pipeline projects.

    He said that the team will be led by Nigeria’s Engineer Rabiu Suleiman supported by the DG Hydrocarbon of Niger Republic.

    Buhari said he expected that by December 2018, the group will come up with a detailed roadmap and guideline leading to actual execution of the projects.

    He directed that the detailed roadmap should cover the following: Bankable feasibility studies for both the Refinery and pipeline projects; Optimal project site, pipeline routes and details; Security plan and selected consortia of investors for both the refinery and pipeline projects.

    The President assured of Nigeria’s commitment to pursuing “this partnership with vigour and determination.”

    In his address at the occasion, Kachiku said Buhari has personally driven the initiative, which he said was propelled by the sole desire to create a more favourable investment opportunity in Nigeria’s downstream sector and encourage cross border economic development.

    The occasion was witnessed by the President of Niger Republic, Issoufou Mahammadou.

    Speaking on when the refinery will start, an oil and gas investor, Ibrahim Zakari said “I think the two presidents have already mentioned everything. It is going to be private driven by investors-100 percent private driven   .We are one of the investors who are willing to invest almost 2bn dollars.

    “The funds are coming from abroad, us, Canada, India and the middle east. It’s going to be a 50 thousand barrel refinery then we will scale it up to 100 thousand with the crude coming from Niger Republic.

    On the time frame, he said “It will take 3-5 years to complete the refinery, it’s a Modular refinery. It will create 2500 direct employment and over 10 thousand indirect employment.  It will cover not only Katsina and the North but the whole of Nigeria.”

  • Up Stream Summit: Kachikwu calls for improved collaborations among SSA countries

    …Says theme for Upstream Oil and Gas Summit apt

     

    The Sub-Saharan African (SSA) countries need to continue to cooperate with each other to achieve the desired success stories in the industrialisation and developments in the resources, especially in the Oil and Gas sector, Dr. Ibe Kachikwu, Minister of State for Petroleum Resources has said.

    Kachikwu said this in a keynote speech at the fourth edition Sub-Saharan African Upstream Oil and Gas Summit and Exhibition held on April 11-13, 2018 at the International Conference Centre, Abuja, Nigeria, highlighting that the SSA as a geopolitical zone is attracting considerable attention as human capital and natural resources provide building blocks of a sustainable economy.

    Dr. Kachikwu represented by Mr. Gbite Adeniji, his Special Technical Adviser (STA), extolled the Summit for providing veritable platform for intellectual discourse, knowledge sharing and showcasing giant strides made by the industry as well as the theme: ‘Gearing Up for Growth: Sub-Saharan Africa Oil, Gas and Power Value Chain’.

    The Minister rated high the current reform of the African Petroleum Producers Organisation, championed by Nigeria as a major key collaborative effort that must be pursued to achieve the Continent’s lofty aspirations as a geopolitical bloc.

    “Oil, Gas and Power yield a variety of benefit to our countries, ranging from revenues for governments, nations’ development, to employment opportunity for our citizens;

    “The different segments, upstream to downstream, undoubtedly bring benefit to our nations. As such realization of the entire value chain of these petroleum resources within our countries, presents a virile opportunity to alleviate socio-economic challenges and foster sustainable growth in our countries”.

    He said there was no better time than now to take all necessary actions that would facilitate the realisation of these potentials for desired success stories.

    The Nigerian Oil and Gas Industry Roadmap ‘7 big wins, Dr Kachikwu said, reflects the country’s efforts towards realization the value chain of oil, gas and power.

    “The 7 key initiatives entail interplay of innovative technology, economics and public policy,” he added.

    Speaking further, he said the present administration has deployed framework for the value chain of gas to be extended. “The Nigerian Gas Flare Commercialization Programme (NGFCP) targets to eliminate flares by ensuring that these currently unexploited gases are converted into benefits using proven technological innovations, while also perpetuating socio-economic benefits for the Country”, the Minister explained.

    On the state of the local refineries, he said, “Our refinery initiative drive is yielding result, as numerous investors/licensees are presently at advanced stages of modular refinery establishment with planned commissioning of at least two modular refineries before the end of the year”.

    Security-wise, the keynote Speaker said that the state of security in the local communities in the Niger-Delta has improved due to constant engagement with the oil producing regions. “The most glaring result is the rise in GDP (to 1.40%), partly attributed to the stable and sustained level of petroleum production.

    Earlier, ‘Dapo Ayoola, Managing Director & CEO of Zenith Professional Training (ZPT) Limited; the managers of the Summit, said that the platform was conceived as means for exchange of ideas on the mutually beneficial opportunities by oil, gas and power sectors.

    According to Ayoola, the theme was carefully selected to deliver the maximum returns to all participants hence the addition, for the first time, an investment forum dubbed ‘Invest Energy Africa’ and a session dedicated to women in petroleum.

    “Africa is the last true oil and gas frontier with more than 4,200 oil and gas blocks identified. Almost half of these blocks are open, subject to force majeure or in the application phase.

    “More that 80% of the 1,300 blocks in North Africa are licensed, while in Sub-Sahara Africa, it is estimated that only about 30% of 2,900 blocks are licensed. It is evident that many new opportunities still exist, especially for the exploration and production companies that are willing to take risks,” he said.

    Participants at the three day event were drawn Government/policy makers, investors in the oil, gas and power sectors in Nigeria, Ghana, Tanzania, among others.

    Read Also: Nigeria needs $100b oil investments in five years – Kachikwu

  • Nigeria’s under-recovery petrol importation hits N1.4tr

     

    The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, Thursday disclosed that Nigeria currently records about N1.4 trillion yearly as under-recovery from its importation and sale of Premium Motor Spirit at N145 per litre.

    He spoke at a meeting in Abuja where stakeholders in Nigeria’s Liquefied Petroleum Gas (LPG) sector met to review the challenges of the LPG market and find ways to mainstream it into the country’s fuel market, Kachikwu, explained that it was time Nigeria began to look at alternative fuel sources like LPG which are clean and less expensive for the country.

    He also stated that the President, Muhammadu Buhari, would in the next two months launch an infrastructure rebirth plan with which the country would leverage to attract private finance to upgrade her oil and gas infrastructure.

    His words: “Clean energy is very essential and we need to move away from complete utilisation in our transport sector of only PMS which is creating a lot of under-recovery of N1.4 trillion per annum of exposure to the government.”

    The minister said that : “At the end of the day, we begin to go into other components of cleaner fuels and rely less on the PMS that is gotten from out of the country.”

    When asked to clarify if the current figure on petrol under-recovery was annually and how the federal government felt about it, the minister said: “Yes, currently. That is being addressed at a very high level and I don’t want to go into that.”

    In March, the Nigerian National Petroleum Corporation (NNPC), disclosed that its current expenditure on petrol subsidy was N774 million daily, and that the 50 million litres of petrol was consumed across the country every day.

    NNPC’s Group Managing Director, Dr. Maikanti Baru, described the amount as “under-recovery,” adding that the huge fund was due to the proliferation of filling stations in communities with international land and coastal borders across the country.

    Kachikwu, also indicated that the government would launch an infrastructure rebirth plan for the oil and gas industry. The rebirth plan he noted would enable private investors put in money in key infrastructure assets across the entire value chain of the sector.

    “I think government is focused in all the areas. We are hoping to launch an infrastructure rebirth map for the oil sector over the next two months, and I hope his excellency, the president will launch that.

    “The effect is that it will be to open up tariff and create policy positions that will enable people to actually go in and invest in critical infrastructure that is needed because anywhere you go, whether it is distribution of petroleum products massively through trucks and rather than through pipelines, whether it is been able to take crude into refineries or distribute gas throughout the country, infrastructure is so key.

    “There are lots of stranded gas and power everywhere. Distribution is key, infrastructure is key. We need to find a way of finding enough incentives to enable the private sector go in very bullishly and put the money where it is supposed to be,” he explained.

    On the significance of the LPG meeting, he said: “Coming from this meetings we are having, we will come up with recommendations of what DPR needs to do to deepen licensing issues and enforcement issues, but over and above just going after individuals who have done it wrongly; what are the incentives, schemes and structures we need to put in place, and it just goes to tell u where the storage capacities for the gas we have been buying; where are the official distribution and sales centers. If we deepen the regulation, deepen the licensing and enforcement, we should be able to get there.”

    He added that “But like you know, we already have a gas policy which was approved at FEC and all of this is in there. What this group is going to do is to take a piece of that as it concerns LPG and say how we can take that policy document and expand and activate the whole LPG.”

    Read Also: NNPC declines Falana’s request for information on ‘proposed’ petrol price
  • What’ll solve downstream problems – Kachikwu 

    What’ll solve downstream problems – Kachikwu 

    Minister of State for Petroleum Resources, Mr. Ibe Kachikwu, Tuesday, said that unless urgent solutions are proffered to the issues of pricing of petroleum products, fixing the existing refineries and encouraging private investors to build new ones, the Nigeria’s downstream challenges will not be solved.

    He urged that care should be taken to ensure that people are not made to suffer unduly, while attempting to review the prices of petrol and other commodities.

    Kachikwu, who spoke at the ongoing Nigeria International Petroleum Summit in Abuja, said, “Ultimately, the greater challenge that this country would have and still have is that of pricing.

    “Everybody wants power, available gas and freely delivered fuel with no queues, but people are not willing to make the sacrifices that are essential for these things to happen.

    “Sometimes, it is a pricing issue. We have got to get to a point where we got to deal with some of these issues in a manner that doesn’t hurt our people but at the same time create the level of efficiency as to remove arbitrages and patronages that are inbuilt in them.”

    “Refineries and local production are key. We expect a 12 to 18 months corridor of construction and hopefully, at that point, we would get our refineries back. However, if we get refineries back by 2019, does that solve the problem? No, it doesn’t. You still have to deal with the pricing issues, because nobody is going to build a refinery and sell products at a loss.”

    The challenges notwithstanding, the Federal Government would be setting parameters and incentives for building of refineries.

    According to him, this is to ensure that a typical producer, especially the small level producers are able to see enough incentives to be able to get some of their products refined in-country, then exported.

    “That is the major policy directive. There are going to be incentives for those who are doing the major practical investments in the refineries for example. There is not a dearth of opportunities in this country. I do not know of any country with the vast opportunities that Nigeria possesses,” he insisted.

    The minister argued that there was actually no reason why oil companies would do their business in Nigeria and take 100 per cent of the crude oil produced out of the country.

    “What are they doing with it? They are going to take it to refineries; they are going to crack them somewhere. If there are incentives for them to crack them here, they would do so. Ultimately, Nigeria must aim to be the refining corridor for the whole of Africa. That is becoming very critical,” Kachikwu noted.

    “If we do all that concerning the planned investments in refineries, my position is that the business has got to change. It has got to change to taking your crude oil and been able to refine. It has got to change to be a major player in the power sector. It is got to change from oil, into gas and into clean energy. We have got to look into moving incentives away from oil, back into gas and back into cleaner energy.”

  • FG to focus on good refineries, gas commercialisation in 2018

    FG to focus on good refineries, gas commercialisation in 2018

    The Minister of State for Petroleum Resources, Dr Ibe Kachikwu, on Monday said government would focus on making refineries work and commercialising gas in 2018.

    In a podcast released by Kachikwu in Abuja, he said government would also bring in the private sector to restructure dilapidated infrastructure.

    ”To the big picture of 2018 and early 2019, what are the key things we are going to focus on? First is the refineries. I have talked about this over again, it is important that we get these refineries working.

    ”We must exit importation in 2019 and we are happy Dangote is working very hard and bringing back the timeline for the completion of his refinery.

    If we can do that, we are going to be saving the country over 30 per cent of forex application on importing petroleum products.

    ”Gas flare commercialisation, we have launched it, it is taking off, we are continuing to deepen our conversation with oil companies to ensure that we exit gas flare in over gas flare sites.

    ”Infrastructure is key to us, our infrastructure is 30/40 years old, completely dilapidated, can’t be funded by the government anymore.

    “I am working with the NNPC and DPR to launch our infrastructure masterplan and bring people who can invest in them.

    ”There is the issue of crude tracking – how do we track every molecule of products we have, crude and refined products? We are putting together an IT platform that will enable us do this, we are working with DPR and hopefully by the 2019 the issues of whether we could not account for our crudes will no longer occur.

    ”We are planning our marginal fields’ rounds and we are also planning our inland basins rounds. It is going to be a transparent process to bring people to get us more oil.

    “The rules are going to be out soon once it is approved by His Excellency,” he said.

    Kachikwu said the he would like to see the sector hit 2.2 million barrels though subject to OPEC constraints and fixing the infrastructure was essential to this.

    He said the government being able to exit the joint venture cash call had reassured multinationals of their need to invest in the country and they had invested over $14-15 billion dollars, which were for purposes of projects like Zabazaba and Bonga extension.

    ”We delivered an open NNPC, a lot of work still needs to be done there.

    ”We are going to be rolling out our fiscal policies which are now awaiting FEC approval.

    “Those fiscal policies will expand income in the short term over $2 billion a year to the Federal Government but on a long term over $9 billion.

    ”On the back of that, we will be working with the assembly to transmit that into legislative provisions,” he said.

    The minister said he would be going back to the Niger Delta to meet governors of the region and oil companies, to put a ‘seed’ to some of the agreements on ground. (NAN)

  • NEMSA investigates cause of fire in Kachikwu’s house

    NEMSA investigates cause of fire in Kachikwu’s house

    The Managing Director, Nigerian Electricity Management Services Agency (NEMSA), Engr. Peter Ewesor, Tuesday said that the agency has commenced investigations into the cause of the fire outbreak in the Asokoro house of the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu.

    He spoke in Abuja during a press briefing on the focus of the agency owing to his reappointment.

    Asked whether he was aware of the fire incident, he urged former Acting MD, Engr. T.T. Aliyu to respond.

    Aliyu said that “we got the report on Monday and we have acted on it and commenced its investigation.”

    Continuing, Ewesor added that “it is something we are working on.” He stressed that only a preliminary report can be ready at the moment, although the agency prefers concluding thorough investigation before issuing its report.

    He announced that the agency has secured a conviction of four accused persons at the chief magistrate court of Kaduna State for the Offences of criminal conspiracy, forgery of the NEMSA certificates and cheating.

    He said that the Offences are contrary to section 59, 345, 308 of the penal code of Kaduna State.

    The Chief Electrical Inspector of the Federation however vowed that the agency would “intensify its efforts in terms of enforcement of technical standards and regulations, technical inspection, testing and certification of all categories of electrical installations, electricity meters and instruments to ensure the efficient production and delivery of safe , reliable and sustainable power supply and guarantee safety of lives and property in the Nigerian Electricity Supply Industry (NESI ) and other allied industries/workplaces safety standards.”

    According to him, the agency is determined to empower its staff to discharge their responsibilities by ensuring a conducive environment for work, scale up on necessary work equipment and investing in human capital development.

    He added “importantly too, we are already expanding our services, getting closer to people by inaugurating new inspectorate field offices, such as the new Owerri Office, Bauchi and one coming up in Uyo.”

    Ewesor noted that the agency tested total of 64,222 out of which 63,942 passed and 280 failed.

    He said that NEMSA monitored and evaluated 2,699 existing networks and power systems, out of which 618 were resolved and 2,081 are outstanding.

    Continuing, the Managing Director noted that the agency inspected and tested 5,037 new power projects/electrical installations along power supply chain and utilization, out of which 4,138 were certified for use while 899 awaiting rectification of observed defects.

    The NEMSA boss said that the agency investigated 94 electrical accidents/ electrocutions.