The Nation Newspaper

Tag: Minister of State for Petroleum Resources

  • Senate probes concession of Port Harcourt refinery to Agip, Oando plc

    Senate probes concession of Port Harcourt refinery to Agip, Oando plc

    …Asks petroleum ministry to suspend all transactions

     

    The Senate Tuesday resolved to investigate the planned concession of the Port Harcourt Refinery to Agip and Oando plc by the Ministry of Petroleum Resources.

    The upper chamber also asked the Ministry of Petroleum Resources to stop all processes and transactions regarding the concession pending the conclusion and submission of the report of its ad-hoc committee set up to probe the deal.

    The resolution followed the adoption of a motion entitled “Non transparent transaction relating to the planned concession of the Port Harcourt Refinery to Agip and Oando by the Ministry of Petroleum Resources,” sponsored by Senator Sabo Mohammed (Jigawa South).

    Mohammed in his lead debate expressed worry about alleged non-transparent transactions of the planned concession of the Port Harcourt Refinery to Agip and Oando by the Ministry of Petroleum Resources.

    The lawmaker said that he is aware that the Federal Government recently entered into an agreement with Nigerian Agip oil company, a subsidiary of ENI, an Italian oil giant to construct a $15 billion refinery in the Niger Delta region, a deal which also includes investment by Agip in a power plant with the Italian company assisting Nigeria in repairs of the Port Harcourt Refinery.

    The Minister of State for Petroleum Resources, Ibe Kachukwu, he said informed that the agreement was part of a broader Federal Government plan to increase capacity for local production and consumption of petroleum products with the aim of ending fuel importation in the country by 2019.

    He noted that while the resolve by the Federal Government to increase local refining capacity is laudable and should be applauded by all Nigerians, the observance of corporate governance principles and the country’s extant laws must be followed to the latter.

    Mohammed said that he is concerned that it is not yet clear if the new arrangement is a concession agreement or an agreement to build a new refinery.

    He noted that the confusion became obvious following the disclosure on May 11, 2017 by the Chief Executive Officer of Oando plc on the floor of the Nigeria Stock Exchange that the group had received approval of the Federal Government to repair, operate and maintain the Port Harcourt Refinery with their partner Agip.

    He said that the development would have been wonderful because it would mean an end to importation of refined products by the year 2020, “but many questions are begging for answers, such as it it Agip/ENI or Oando plc that is taking over Port Harcourt Refinery?

    The lawmaker also wanted to know whether there was observance of the privatization law as regards due diligence, selection from preferred bidders before ceding the Port Harcourt Refinery to Agip/Oando.

    Mohammed said that the Senate should be concerned that the planned concession of the Port Harcourt Refinery to Agip/ ENI in partnership with Oando plc without recourse to due process is illegal and a clear attempt at ridiculing Nigerians and would definitely create a big hole that would be hard to fill in the anti-corruption crusade of the present administration.

    He said that he is aware that in such transaction, “the best practice is to select partners through open and competitive bids.

    He insisted that any exclusive arrangement that does not follow due process, one hatched in the dark without the knowledge and participation of relevant stakeholders tend to lead to sub-optional outcome for the seller, in this case the Federal Government.

    He lamented that major stakeholders such as BPE that was empowered by law to conduct such exercise and labour unions are not aware of the deal that is supposed to be signed officially in July this year.

    He said that the Senate should be concerned that since Agip has no technical record/history in the Port Harcourt Refinery that was built by a Japanese firm, “one would have expected the concerned authority to look at the Warri Refinery that was built by Agip where they have technical record.

    Mohammed said that he is saddened that on assumption of office as the Group Managing Director of the NNPC, Kachukwu declared that by the end of 2015, the Port Harcourt, Warrit and Kaduna refineries would be working a 90 per cent capacity, thus reducing  importation and the subsidy controversies.

    He said that it is sad that “up till now in 2017, the refineries are yet to be fixed and cannot even produce at 50 per cent not to mention 90 per cent.”

    Some senators who spoke warned that the Port Harcourt refinery must not be allowed to go the way of Power Holding Company of Nigeria (PHCN) and other privatized organizations in the country.

    Senate President, Abubakar Bukola Saraki, raised a seven-man team to investigate the planned concession.

    Senator Abubakar Kyari (Borno North) is named chairman of committee. Other  members of the committee included Mathew Urhoghide, Duro Faseye, Benjamin Uwajumogu, Sabo Mohammed, Dino Melaye, Aliyu Wamakko.

     

  • Buhari to minister: stimulate economy with petroleum 

    Buhari to minister: stimulate economy with petroleum 

    …Kaxhikwu vows to raise $20b

     

    President Muhammadu Buhari Thursday launched the Nigeria Oil and Gas Industry Roadmap tagged “The 7 Big Wins”,” and urged the Minister of Petroleum Resources to maximize petroleum resources to  stimulate the economy.

    Speaking during the public presentation at the Banquet Hall of the Presidential Villa, Abuja, he said: “Therefore, the task before the Ministry of Petroleum Resources is to maximize the potentials and opportunities across the whole range of the Oil and Gas industry to stimulate our economy in spite of the current challenges.”

    He admitted that the industry presently remains critical to the nation’s economy in spite of her challenges.

    He stressed that the “golden era of high oil prices may not be here now, but Oil and Gas resources still remain the most immediate and practical keys out of our present economic crisis.

    “The Oil and Gas still remain a critical enabler for the successful implementation of our budget as well as the source of funds for laying a strong foundation for a new and more diversified economy.”

    The President noted that as important as it is to ensure that Agriculture, Solid minerals and other critical sectors of the economy are supported to grow and contribute more to the nation’s economy, Nigeria still needs a virile and efficient oil & gas industry to take care of her foreign exchange requirements.

    According to him, this is a national imperative and a core thrust of the nation’s economic policy.

    Continuing, Buhari said “Therefore, the task before the Ministry of Petroleum Resources is to maximize the potentials and opportunities across the whole range of the Oil and Gas industry to stimulate our economy in spite of the current challenges.

    “To do this certainly requires creativity, innovation, technology and robust partnership amongst various stakeholders.”

    The President called for the dire need to instill a new culture of transparency and efficiency in the industry, streamline operations along best practices by championing and implementing strategic reforms at every layer of the industry.

    He noted that this “will help us improve oil and gas production, explore our frontier basins, improve our local refining capacity and above all build sustainable partnerships with the oil producing communities.

    “If we are able to plug the leakages, and tighten loose systems that characterized this industry in the days of high oil prices, we are convinced that we can do even more with the little that we are getting at the moment than we did even in the time of plenty.

    ”  As you are aware, recent developments in the Niger Delta have temporarily limited our oil and gas production and supplies. However, let me reaffirm that, whatever challenges we are currently facing in the region, our resolve and capability to work with all stakeholders to restore normalcy will guarantee success.”

    Speaking, the Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu explained that  disclosed that the major thrust of the programme is to raise government’s revenue from the oil sector through cutting down on project contracting cycle, ensuring 100 per cent local refining by 2019 and the commercialization of gas flaring.

    He further stated that the country would ensure that it finds every oil that is available in every part of the country, with increased private sector participation, while it intends to raise $5 billion and $20 billion in the short and long term respectively, for the Federal Government.

  • OPEC members seal deal on oil production cut

    OPEC members seal deal on oil production cut

    …Kachikwu’s diplomacy yields dividends

    After about forty eight (48) hours of a grueling meeting of the Organization of Petroleum Exporting Countries (OPEC) held in Algiers, Algeria, the oil cartel on 28th September, 2016, agreed to a landmark deal that will effectively cut production to 32.5 million barrels per day from around 33.24 million, with levels of output for each member country to be determined in November 2016.

    The Director, Press, Ministry of Petroleum Resources, Idang Alibi said this will be the first time in eight years that OPEC would be reaching such an agreement. This could be loosely tied to the role that has been played by member countries, including Nigeria, in refocusing OPEC to work harmoniously in identifying needs and challenges that are peculiar to the body and surmounting them, a key challenge being the low price of oil in the international market which has affected the global economy with most OPEC member countries feeling the heat.

    OPEC member countries reached a consensus in the agreement where three countries are exempted from the production cuts and they include, Iran, which just had its economic sanctions lifted earlier in the year, Libya and Nigeria who have had some of their oil facilities damaged by terrorist attacks in recent months.

    The Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu, who led Nigeria’s delegation at the meeting argued for the exemption of Nigeria from the production cut. The concession was given considering the recent challenges the country has been through due to vandalism of oil and gas infrastructure, which has negatively impacted the country’s ability to produce oil optimally in the recent past

    This deal will obviously enhance the prospects for the energy industry with the impacts already being felt as oil price jumped more than five per cent in New York after the agreement was reached. A steady increase in oil price, one of the advantages the deal will produce, would most likely contribute positively to the revival of the economies of member countries presently undergoing challenges which Nigeria is a part of.  However, many of the details of the production cut deal are still being worked out by member countries and the group won’t decide on targets for each country until its next meeting at the end of November 2016. Kachikwu would be representing Nigeria and her interest at the November meeting.

    The landmark deal is coming at a time when Kachikwu played a key role to clinch the top job at the OPEC for Nigeria with the appointment of Dr. Mohammed Sanusi Barkindo as the Secretary-General of the Organization. This meeting was the first official meeting of OPEC to be organized by the new Secretary General since his official resumption on 1st August, 2016, he added.

  • Ngige, Kachikwu to meet with PENGASSAN over planned strike

    Ngige, Kachikwu to meet with PENGASSAN over planned strike

    The Minister of Labour and Employment, Sen. Chris Ngige, is to meet with representatives of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) on Thursday, a statement issued on Wednesday in Abuja said.

    The statement, signed by Mr Samuel Olowookere, the Deputy Director (Press) in the ministry, said that the “crucial meeting’’ was being convened to find a lasting solution to the lingering problems in the oil and gas sector.

    It said that the Minister of State for Petroleum Resources, Dr Ibe Kachikwu, would also participate in in the dialogue scheduled for 10 a.m. in Abuja.

    NAN reports that PENGASSAN has threatened to embark on a nationwide strike beginning from Thursday over some issues, including the alleged mass sack of its members by various oil and gas companies.

  • Nigeria to end fuel importation in 2019- Kachikwu

    Nigeria to end fuel importation in 2019- Kachikwu

    Minister of State for Petroleum Resources, Dr Ibe Kachikwu, yesterday said Nigeria would end fuel importation by 2019.

    He said it requires $50billion dollars to fill the infrastructural gap in the industry and get it functioning optimally.

    He said by 2019, Nigeria expects to become a net exporter of refined products, adding that an investment drive is ongoing to meet the infrastructure requirement.

    Kachukwu was a guest speaker at the 10th Annual Business Law Conference of the Nigerian Bar Association Section on Business Law (NBA-SBL) in Abuja, with the theme: Law reform and economic development.

    Speaking on the sub-theme: Future prospects for the oil and gas industry, the minister said the refineries are currently working at about 40-50 per cent capacity.

    He said the aim is to get them working at 90 per cent capacity or more and build the needed infrastructure as investors come in.

    On why refineries are working at low capacity, he said: “How does a refineries work if the pipelines supplying them are out most of the year and so they can’t supply crude? You can’t refine an empty space.

    “How does it work when you don’t do your turnaround maintenance or if when monies are budgeted for them they are diverted? How does it work if your contracting process is so long that you never meet the turnaround days you’re supposed to? How does it work when you send the wrong set of people with the wrong set of skills to what should have been very important portfolios in the establishment?” he said.

    The minister said engagements with militants in the Niger Delta has been successful, resulting in a ceaseful and rise in crude production.

    He said he visited the creeks and met with the local chiefs with a view to finding a short, medium and long term solution to the crisis.

    Kachukwu praised President Muhammadu Buhari for not employing force in solving the problem, adding that when he visited the creeks, the militants “never fired a gun” while he was there.

    The minister said oil production has picked up as the Niger Delta crisis is being resolved.

    According to him, 1.89million barrels was produced as at Wednesday. He said he expects it to hit 2.3million barrels by next month.

    Kachikwu said reforms in the petroleum industry required “bold thinking to challenge the status quo”.

    According to him, it required balancing interests of several groups with conflicting demands, some of which he said appeared valid.

    He said: “The deregulation was a very bold thinking. Removal of subsidy was a bold thinking. Restructuring (the NNPC) was a bold thinking.

    “We are working on a fairly fast-paced track where every month has a major new issue that we have to deal with.

    “We’re looking at a template of two years in which to do so much in terms of changing this industry and recreating the opportunities that are inherent in the system.

    “The greatest challenge for someone who is initiating policies is how to satisfy all the interest groups. It was why we couldn’t pass the PIB and in trying to get the militants to back out so we can have some peace in the place.

    “Timing of reforms is key and should have been yesterday. In most of the areas we are far behind time and our competitors and that is basically why we’re in a virtual race position today. We need to do all this to be able to get to where we should be.”

    On how the government is dealing with issue of militancy, Kachikwu said it is deploying a wholistic solution.

    “The problem has been that most times when these things (pipeline bombings) happen, we find an interim solution that stabilises production for a while and then we drop off the table and it comes right back.

    “There are lots of things that need to be done. In the short term is to stabilise the conversation so that some civility will replace adversarial norms.

    “I think we’re getting very close to that. At least parties have pulled back for 30 days for more talks. Those 30 days are going to be a fire-engine type racing to do something.

    “We need to set up, for example, a real engagement team that will be able to take up the larger stakeholders – the kings, the community leaders to clearly understand what they want and decide on the minimum standards of what is needed.

    “We also need to set up a much more practical team that deals practically with the individuals who are out there exercising the mantra of militancy.  We need to set up a body that focuses on the development of the Niger Delta.

    “One of the reasons why I took time to fly into some of the creek areas wasn’t for publicity. It was to get a firsthand feel of what it is really like there. Once you get into an area where there are no roads, no light, no water, it’s a different mindset. And you need to spend time to understand that mindset.

    “In the three of the locations that I visited, I could relate the villagers who are living there with the militants who are living next door in the forest and who were respectful enough not to fire guns while I was there.

    “What it showed, as my father used to say, is that ‘mad men have rules of engagement.’ It doesn’t matter what you think of militants, they do the things they do because hopefully they have burning passions for the positions they take and we need to understand that kind of psychology.”

  • Photo: Ambode at the National Economic Council

     

    Lagos State Governor, Mr. Akinwunmi Ambode, with Minister of State for Petroleum Resources, Dr. Ibe Kachikwu; Kano State Governor, Dr. Abdullahi Ganduje; his Ogun and Plateau States counterparts, Sen. Ibikunle Amosun and Barr. Simon Lalong during the National Economic Council (NEC) meeting in Abuja, on Thursday.
    Lagos State Governor, Mr. Akinwunmi Ambode, with Minister of State for Petroleum Resources, Dr. Ibe Kachikwu; Kano State Governor, Dr. Abdullahi Ganduje; his Ogun and Plateau States counterparts, Sen. Ibikunle Amosun and Barr. Simon Lalong during the National Economic Council (NEC) meeting in Abuja, on Thursday.

     

    Lagos State Governor, Mr. Akinwunmi Ambode, discussing with Governors of Kebbi, Ogun and Gombe States, Alhaji Atiku Bagudu; Sen. Ibikunle Amosun and Alhaji Ibrahim Dankwambo during the National Economic Council (NEC) meeting in Abuja, on Thursday.
    Lagos State Governor, Mr. Akinwunmi Ambode, discussing with Governors of Kebbi, Ogun and Gombe States, Alhaji Atiku Bagudu; Sen. Ibikunle Amosun and Alhaji Ibrahim Dankwambo during the National Economic Council (NEC) meeting in Abuja, on Thursday.

     

  • Fuel price will go down, says Kachikwu

    Fuel price will go down, says Kachikwu

    Minister of State for Petroleum Resources, Dr. Ibe Kachikwu said Thursday that the price of petrol will come down in a few months.

    Speaking a Channels television programme Thursday morning, he said: “As it gets better and it gets to a point where we find that the market has stabilised in terms of supply, we will begin to pull back a bit in terms of determinants for pricing.

    “You will be amazed at what will happen to your N145 price because it will go downwards.

    “You don’t give what you don’t have. We want Nigerians to understand that we feel the pain, and we have tried to avoid it since I came in October. We have done everything we could.

    “We first went on to the issue of the subsidies that we inherited which, by the way, were based on 50 to 55 million litres consumption, and we said the number looked bloated. So, we did an experiment and came to a conclusion that this country doesn’t consume more than 45 million litres a day.

    “Then we came to a second point and said, ‘We are not even going to have subsidy again. We are going to exit it because there was just too much fraud involved in it.

    “So, left with that option, what were we supposed to do? We have struggled. Queues continue to go and they are back. And it will continue to happen unless we address the issues.

    “If you free up Nigerians to find sources of funds, they will find those secondary funds. They will import the product; the burden on the NNPC will reduce and the country will have peace and subsidy will go away permanently.

    “I am appealing to Nigerians to please for the first time realise that we are doing our very best. I have together with everybody who is in this government worked night and day looking for solutions.

    “We mean well and Nigerians should please trust us. Give us a chance; you will be surprised what will become of your PMS price over the next six to eight months.”

     

  • TMG wants Kachikwu to resign over hike in fuel price

    TMG wants Kachikwu to resign over hike in fuel price

    The Transition Monitoring Group, TMG Thursday demanded the immediate resignation of the Minister of State for Petroleum Resources and the Chief Executive of the Nigerian National Petroleum Corporation, NNPC,  Ibe Kachikwu over the hike of the price of Petrol.

    The TMG in a statement issued in Abuja Thursday and signed by its Chairman, Ibrahim Zikirullahi said it “stoutly rejected  the N145 pump price of petrol imposed by Federal Government”

    TMG said, “to  say the least, this imposition portrays the government as insensitive, and out of touch with the daily unbearable plight of the ordinary Nigerian.

    “Coming at a time when the implementation of the recently signed 2016 Budget, is yet to take off, the hike in the face of groaning and pains, is ill-timed and badly advised.

    “It is tantamount to killing a willing horse to ask the Nigerian people, who are already carrying the heavy burden of the failure of governance over the years, to take on one more load of extreme economic hardship, as represented by the imposed price of petrol.

    “As a grassroots coalition, which has tried to rally patriotic support for the anti-corruption crusade and other government initiatives, which we believe would make the lives of Nigerians better, we must stress that our support of the government is conditioned by the impact of its policies on the long suffering people of this country.

    “Our allegiance is to the Nigerian people, and whenever they come under the hammer blows of insensitive policies, we are duty-bound to speak up in defence of ordinary citizens.  As is the case with this latest hike, we must place it on record that it is absolutely anti-people.

    “TMG will join forces with Labour and other activists to resist this hike. With the many economic woes afflicting the country, including job losses, massive unemployment and galloping-inflation, the least we expected the government to do was to give Nigerians a breather, and allow some form of recovery to take place through a stimulus package injected into the economy to rev it back to life before placing any further burdens. To our utmost disappointment however, ordinary Nigerians have been hung out to dry, and left at the mercy of shylock fuel importers. These importers who can mobilize funds to import petrol, but cannot invest in refineries, are the ones being given a free rein to exert profit from the blood and sweat of ordinary citizens.

    “The Nigerian people feel particularly let down by the unending flip-flopping of the Minister of State for Petroleum Resources, Ibe Kachikwu. Kachikwu’s chameleonic pronouncements on the fuel situation over the past months have left many Nigerians befuddled. One minute he is declaring that refineries have started production, the next minute, he is telling the nation all manner of cock and bull stories about strategic reserves, and the effect of the activities of economic saboteurs. We wonder why ordinary Nigerians would be made to bear the brunt of the crimes of economic saboteurs, whom government with all its might is not ready to deal with.

    “This endless prevarication has kept Nigerians in the dark about the real issues in the oil and gas sector. Kachikwu’s trumpeted move to unbundle the Nigeria National Petroleum Corporation was touted by him as panacea to the issues in the oil and gas sector. As it stands it has all become motion, at the expense of real impact. As if to add insult to injury, Kachikwu’s announcement of the hike failed to provide any road map towards ending importation of petrol, which is the root cause of the current crisis. On the basis of these and many more indiscretions, TMG calls on Kachikwu to immediately throw in the towel, as he has serially demonstrated a lack of understanding of the issues in the oil and gas sector. TMG calls on all Nigerians to reject this insensitive hike in the price of petrol, and prepare for mass action to send a clear message that this imposition cannot stand,” the statement said.

  • FG needs $700m to upgrade refineries – Kachikwu

    FG needs $700m to upgrade refineries – Kachikwu

    The Minister of State for Petroleum, Dr Ibe Kachikwu, said on Saturday that the Federal Government needed 700 million dollars to upgrade its refineries to produce at maximum capacities.

    Kachikwu, who is also the Group Managing Director of NNPC, disclosed this while speaking with newsmen during the re-inauguration of the Port Harcourt/Bonny Crude Supply Line at the Port Harcourt Refining Company (PHRC), Eleme, Rivers.

    He said that due to the fact that the nation did not have such amount, advertisements had been signed for investors to come in.

    According to him, we are not inviting foreign partners to take over the refineries; the total investment for that is up to $700 million and we don’t have that. Let us be honest about it.

    ”So, the best thing to do is to find a very creative way to bring in investors, who will come in, work with our team here;

    ‘’Investors, who have the skills to reactivate and upgrade facilities in this place and help us provide technical support and we will pay through the flow-out of the refined products over time,” he said.

    Kachikwu emphasised that there should be no confusion about what the investors would be coming to do, since they would not come to run the refinery.

    ”They are coming to provide funds to take our performance on these refineries to 90 percent and to provide us with technical skills.

    ”So, the areas of intervention will be funding and technical support,” he said.

    Kachikwu said that at present, Nigerians were consuming about 45 million litres of PMS daily, while the refineries were producing 12 million litres daily as they were working at 60 per cent capacity.

    He said that the nation will need to upgrade these refineries and let them develop to the point where they can perform up to 90 per cent.

    He said that by the time the refineries were upgraded and they start producing at 90 per cent, about 20 million litres would be produced daily.

    The minister said that with such production, it would only meet up with about half of the country’s consumption.

    Kachikwu, however, apologised to Nigerians for their suffering due to the fuel scarcity and also thanked Nigerians for their patience.

    He explained that the government had been able to recover the two critical crude supply pipelines; which were Escravos/Warri and Bonny/Port Harcourt crude supply pipelines.

    Kachikwu said that the pipelines were down for six to seven years but had been repaired and were working and supplying crude to the refineries.

    ”For the first time, the refineries will get their crude, pay for it, they will sell their products and they will earn the income from that product.

    ”And then, they can develop and continue to maintain the refineries even after this intervention is over.

    ”Port Harcourt is back in production, Warri is back in production; Kaduna today is receiving and will soon be back in production. It is something of joy,” he said.

    Kachikwu said, ”Lagos is easing off now from fuel scarcity and Abuja is doing the same thing; once Kaduna begins to produce, the North will see a lot of improvement.

    ”Over and above that, we are putting long term policies in place to ensure that while smaller marketers go out and do their stuff, we can then be the key suppliers for the rest of the country.”

    He commended the workers and the contractors for a job well done; adding that he has signed the promotion letters of the PHRC staff as they deserved to be rewarded.

    Kachikwu, however, said there is a lot still to be done, ”I told you I will never give up.

    ‘We owe Nigerians the duty to ensure that the refineries are working. We owe Nigerians that, we can’t give up,” he said.

    The minister urged Nigerians to remain resilience, “support what the government is doing because this is the only way to change the system.”