Tag: Nigerian National Petroleum Corporation (NNPC)

  • NAAPE to float new airline – Balami

    NAAPE to float new airline – Balami

    Mr Isaac Balami, President, National Association of Aircraft Pilots and Engineers (NAAPE), says the association is considering floating its airline to address the challenge of unemployment among its members.

    Balami made this known in an interview with journalists on Thursday in Abuja.

    He said the national executive of the association had constituted a committee with the aim of setting up a carrier as the members were the ones flying and maintaining the aircraft.

    According to him, what is happening is that, we have lost confidence in most of the employers within the industry, even though; some of them are trying their best.

    “Some are doing very well, but I think since we are the ones that fly and maintain these aircraft, the national leadership of NAAPE has given me the mandate to set up a committee.

    “We might float our own airline very soon so that we can engage ourselves, maintain ourselves and operate because we cannot continue like this,  this is the only industry we know.

    “We have been doing a lot of work so that we can come up with our own airline because we believe we cannot be held hostage in our own industry.

    “There are airlines that have not paid us for the past five to six months because the money that the airlines are making cannot run the airline.’’

    Balami, however, called on the Federal Government to create an enabling environment for the airlines to flourish and in turn create jobs for the industry and boost the economy.

    He said that the government had not been giving support to the industry to enable Nigerian airlines to compete favourably with their international competitors.

    According to him, until the government wakes up and do the needful, create the enabling environment, even if you float a new national carrier with 200 brand new aircraft, it will go down.

    “The Nigerian National Petroleum Corporation (NNPC) confirms that refineries at Kaduna, Warri and Port Harcourt can produce aviation fuel at N50 per litre but currently, we are paying N200.

    “ Before Aero went down, it was flying seven aircraft with eight million tonnes of fuel every month and if we were getting fuel at N50 as against N200 per litre, Aero would not have gone down.

    “It is the government’s responsibility to stimulate the economy, create jobs and support the airlines so that they would continue to fly passengers across.’’

    The NAAPE president said that the nation’s aviation industry had recorded tremendous progress in spite of the many challenges facing the sector.

    He applauded all the aviation agencies over the Category One recertification of the nation’s airports, saying that countries like India and Pakistan had lost their Category One Certification.

    According to him, Nigeria is able to score over 90 per cent in the International Civil Aviation Organisation (ICAO) audit even in the face of funding and others challenges.

    “All I am saying is that we also need the support of the government for the operators so that everybody can play his or her part in moving the sector forward and compete globally,’’ he said.

    On the face-off between the union and Bristow Helicopter over the sack of its members, Balami said the airline was expected to recall all the 21 sacked staff before the weekend.

    He explained that the union would still shut down the operation of the company if it failed to recall its members.

  • NNPC proposes revisions in PIB

    NNPC proposes revisions in PIB

    …Wants publications of payments to government

    The Nigerian National Petroleum Corporation (NNPC) Wednesday outlined a detailed proposal to help the National Assembly fine-tune its deliberation on the draft Petroleum Industry Governance and Institutional Framework law (PIGIF) which is currently before it for legislative action.

    In a presentation at the Public hearing organized by the Joint Senate Committee on the Petroleum Industry Governance Bill, Group Managing Director of the NNPC, Dr. Maikanti Baru, said that though the Corporation is in support of the decision to present the Governance and Institutional Framework as a separate legislation from the Fiscal and Commercial Framework, the prevailing international and domestic business environment makes it imperative to undertake certain revisions to the 2015 Bill as proposed to align it with best international practices.

    The NNPC GMD noted that to enhance transparency in the proposed Nigeria Petroleum Company, NPC, which is being mulled as the successor company of the NNPC, it should be mandated to publish annually a detailed report on all petroleum revenue payments made to government.

    A statement of the Group General Manager, Group Public Affairs Division of the NNPC, Mr. Ndu Ughamadu quoted Baru as saying that : ‘’This should include all royalties, rentals, fees, Petroleum Profit tax, corporate income tax, other taxes, bonuses, profit oil/gas shares from each of the licenses, leases and contracts.”

    Other proposed changes listed by the Corporation include: More emphasis on a low cost, transparent and efficient administration, creating lower overhead costs for petroleum companies, institutional linkages with government decisions related to renewable resources, power generation, climate change policies and other policies affecting the petroleum industry through the roles of the Minister and the proposed National Petroleum Regulatory Commission, NPRC.

    The NNPC is also seeking: a better definition of the roles of the Minister of Environment in relation to the Minister of Petroleum and the NPRC, increased institutional attention to the development and distribution of natural gas, clarity in Joint Venture, JV  and Production Sharing Contract, PSC ownership of  assets including the handling and sale and disposal of available production.

    The NNPC wants the new law to ensure proper delineation of the responsibilities of the proposed new entities including the enactment of transition provisions for effective management of assets, re-enforcement of exploration and production from the frontier basins; much more emphasis on measures that reduce corruption and increased transparency among other items.

    The NNPC however supports the creation of three entities as enshrined in the draft PIGIFB 2015 Bill.

    These entities are: the Nigerian Petroleum Regulatory Commission, NRC, as a regulatory entity for the entire petroleum industry(Upstream, midstream and downstream the Nigerian Petroleum Assets Management Company, NPAMC, as counter-part and administrator of production sharing agreements, and such other risk-based agreements as the Government may decide and the Nigerian Petroleum Company, NPC, as a vertically integrated oil and gas company operating as a fully commercial entity across the value chain that includes the current Joint Venture Operations, Nigerian Petroleum Development Company, NPDC operations, Frontier Exploration and other upstream/service activities, refinery & Petrochemicals, downstream activities as well as sale and disposal of crude oil and products.

  • Buhari inaugurates boards of NNPC, NCDMB,  NNRA

    Buhari inaugurates boards of NNPC, NCDMB,  NNRA

    President Muhammadu Buhari on Friday challenged members of the newly inaugurated boards in the Ministry of Petroleum Resources to ensure decency and transparency in the management of the nation’s oil industry.

    The inaugurated boards included the Nigerian National Petroleum Corporation (NNPC), Nigerian Content Development and Monitoring Board (NCDMB) and Nigerian Nuclear Regulatory Authority (NNRA).

    Buhari specifically tasked the new boards to ensure that they devise practical strategies aimed at tackling current challenges within the oil industry.

    He said the boards, which would be chaired by the Minister of State, Petroleum Resources, Dr Emmanuel Ibe Kachikwu, should advise the minister and the corporations’ management on the most effective ways for Nigeria to get value for money from its assets.

    “Oil and gas are the country’s foreign exchange earners. Therefore, the importance of these boards cannot be over emphasised. Your job should be to ensure propriety in management of these most vital national institutions

    “You should advise the Minister and the Corporations’ management on the most effective way for Nigeria to get value for money from our assets.

    “My expectations from the members of the boards is for them to ensure that NNPC charts a way to face current economic challenges.

    “This will involve a careful look at the ongoing reforms designed to steer the corporation to achieve better performance and efficiency,’’ he said.

    Buhari further stressed the need for the new NNPC board to come up with innovative ways of addressing the constraints in funding Joint Venture projects between the corporation and international oil companies as well as other investment issues.

    According to him, his administration has introduced transparency in the management of the country’s oil industry through the monthly publishing of operational and financial reports of the NNPC.

    The President expressed optimism that with the members’ experience and knowledge, the country’s aspiration in the oil industry would be achieved within a reasonable time frame.

    Responding, the Chairman of the inaugurated boards, Kachikwu assured that they would ensure transparency and accountability in running the affairs of the boards.

  • NNPC to improve quality of diesel 

    NNPC to improve quality of diesel 

    The Nigerian National Petroleum Corporation (NNPC) has commenced work on a scheme to improve the quality of diesel in the Nigerian market for efficient and optimal performance of diesel-powered engines.

    This was disclosed by the Manager, Collaborative Research of the Research & Development Division, Engr. David Akpan, in a presentation made to the Group Managing Director of NNPC, Dr. Maikanti Baru, during an official tour of some R&D facilities in Port Harcourt.

    The Group General Manager, Group Public Affairs Division, Mr. Ndu Ughamadu  revealed this in a statement Thursday.

    Giving details of the research, Engr. Akpan said the R&D Division was working in collaboration with Petronas, Petrobras, Statoil and Saudi Aramco to achieve significant reduction in sulphur and carbon content as well as other impurities in diesel.

    He stated that the project also involves non-conventional upgrading of other refined products including crude oil.

    Speaking at the event, Dr. Baru described research and development as a vital tool for advancement in any organization desirous of re-inventing itself in the ever competitive market place.

    The GMD called on the Management and Staff of the Division to support him in the renewed vision to transform R&D.

    “Organisations that grow commit a significant part of their budget to research and development and we are going to do that; if what it takes for you to grow is to make you a limited liability company, we are going to do that,’’ the GMD stated.

    He, however, charged the Management and Staff of the Division to brace up for the challenges that come with operating as a limited liability company.

    “It means that your staff cost will not be borne by NNPC Corporate Headquarters but by you, and you have to make profit and support the Corporate Headquarters. We are looking forward to that day and we expect a lot from you,” he said.

    Engr. Akpan explained that the mission of the Division was to carry out research, develop technology and provide services to the oil and gas industry. He added that its operation was propelled by the vision to be a world-class petroleum research centre driven by innovation and quality.

    He said the Division has capabilities to handle sundry industry projects across the upstream, midstream and downstream sub-sectors

    In the upstream, he stated that the Division has proven capacity to handle seismic studies, geochemical and geophysical studies, drilling/mud studies among others.

    The R&D Division, he also noted, has developed capacity in handling midstream issues like environmental and air pollution monitoring, environment compliance monitoring, environmental impact assessment studies etc.

    In the downstream sub-sectors, R&D has posted good results in testing crude oil assay, fresh/waste water evaluation and petroleum product quality testing among others.

     

  • NNPC moves to grow oil, gas reserves

    NNPC moves to grow oil, gas reserves

    The Nigerian National Petroleum Corporation (NNPC) is set to grow the nation’s oil and gas reserves, the Group Managing Director, Dr. Maikanti Baru, has said.

    He made this assertion in Lagos on yes while delivering a keynote address at the 34th Annual International Conference and Exhibition of the Nigerian association of Petroleum Explorationists (NAPE) with the theme ‘Nigerian Oil and Gas Industry: Tackling Our Realities’.

    The Group General Manager, Group Public Affairs Division, Ndu Ughamadu disclosed this in a statement Tuesday.

    He noted that NNPC would continue to ring-fence exploration budgets in both Joint Venture and Production Sharing Contract arrangements to ensure there was work for all service providers in order to provide the needed impetus to grow the nation’s oil and gas reserves.

    ‘’There is no need re-inventing the wheel. We are now progressing with the use of exploratory techniques that have worked on our neighbour’s side of the Basin to achieve similar results on our side.  This will also provide a vista for NAPE and its professionals to further analyse the concept of oil generation, expulsion and entrapment in rift basins which we now know is different from the Niger Delta Basin that we are used to,’’ the GMD posited.

    ‘’The NNPC will aggressively pursue domestic refining to take advantage of improved refining margin during periods of low oil prices.  To address the current sub-optimal performance of the domestic refineries, a new rehabilitation strategy which includes the rehabilitation of refineries, modification of the refinery business model and governance structures that tie capital investment performance to actual refinery output are being pursued,’’ Dr. Baru disclosed.

    In terms of security challenges, the NNPC helmsman appealed to those behind indiscriminate acts of infrastructure vandalism to put an end to the despicable acts forthwith, stressing that the destruction of critical energy infrastructure is a great threat to the economy, environment and energy security.

    Conferring the highest NAPE Honorary Award on the GMD, the President of the Association, Mr. Nosa Omorodion, described Dr. Baru as a thorough bred professional who has impacted the industry positively assuring of NAPE’s readiness to continue to provide professional support for the Oil and Gas Industry.

  • N/Delta: Oil industry corruption birthed militancy – Agaga

    N/Delta: Oil industry corruption birthed militancy – Agaga

     There is no denial that in the minds of many patriotic Nigerians in Diaspora, who are Professionals and have become authorities at different capacities, what matters most is setting things straight in Nigeria; making leadership accountable to the people while delivering election campaign promises to the citizenry. This is similar to the interests of the Chairman of the All Progressives Congress (APC) in Spain, Comrade Stephen Tella and a few other Chairmen, APC Diaspora.
    It is in the effort to correct the age long plague, corruption, that has bedevilled the Nigerian petroleum sector, the Nigerian National Petroleum Corporation (NNPC) and the Niger Delta region in South-South Nigeria, that APC diaspora has sorted out Prince Christopher Akpojotor Agaga, who is well read and informed in the Nigerian petroleum industry as well as a few other countries around the world.
    Recalling the problems with the Nigerian oil sector, the Nigerian National Petroleum Corporation (NNPC), the Oil cabals and the Niger Delta people of South Southern Nigeria which dates back to 1907 when Nigerian Bitumen Corporation conducted exploratory work in the country, Prince Agaga boasted that if the Federal Government agrees to follow his proposal, contained in this report, the issue of Niger Delta agitations/militancy, the amnesty programme, as well as the unemployment menace ravaging Nigerian youths will be properly taken care of.
    Of a truth, the Nigerian oil and gas industry has been vibrant since the discovery of crude oil in 1956 by the Shell Group. However, the sector was largely dominated by multinational corporations until the early 1990s when Nigerian companies began to make a foray into the industry. Local participation was boosted with the implementation of the Nigerian Content Directives issued by the NNPC about a decade ago, and eventually, by the promulgation of the Nigerian Oil and Gas Industry Content Development (NOGIC) Act (The Act) in 2010, which seeks to promote the use of Nigerian companies/resources in the award of oil licences, contracts and projects.
    In respect to the enactment of the Local Content Act, Agaga, in an interview with newsmen, advised the President Muhammadu Buhari-led administration to create the office of the Nigerian Content Development and Monitoring Board (NCDMB), which he said will be a Federal Government organ, statutorily saddled with the authority to formulate and regulate the implementation of the Local Content Policy in the Petroleum industry.
    “This by extension is to monitor the full adherence to all the clauses as stipulated in the signed Local Content Act right from the pre-qualification stage through the Bidding stage and during the awarding and execution stages, because the Local Content Policy is to regulate, evaluate, monitor and effect the day to day implementation of every operation in the Oil and Gas industry which stipulates that Nigerians must be encouraged to be major players in the industry.
    christopher-agaga-1“This, the Nigerian Government believes will help in capacity building and also enhancement of all necessary opportunities. But ironically, this noble innovation of Government, because it has not been properly handled, has not yielded the required results and as such, in a very disappointing way, quenched the apprehensions which are serious sources of worries to all operators in the Oil and Gas Industry.
    “In addition to the above, effective monitoring and evaluation of projects are essential and pivotal means of guiding and accelerating the economic growths. However, evidence has shown that the practice of monitoring and evaluation / enforcement during construction projects in the Oil and Gas industry is grossly deficient since it has not been effectively extended through the necessary apparatus of Government to the Grassroots operational areas and as such led to the wastage of resources and leakages which negates project programmes designed to impact positively on the poor suffering people of this country.
    “Similarly, it has led to the prevention of the full assessment of projects in comparison with the declared intent from which authorization is derived. This deficiency can manifest the proliferation of continuous stoppage and disruption of construction projects in the respective projects sites which in turn will give a negative impact on the economic growth and development in the Oil producing states in particular and Nigeria in general. Therefore, the indispensability of project monitoring and enforcement cannot be over emphasized and also will only through a perfect connubial attract genuine development in the respective host communities,” he observed.
    The Political leader from a Niger Delta community noted that the office of the NCDMB shall be operated on behalf of the President by a Special Assistant who will automatically become Government/ Community Liaison Officer in the Presidency and shall be known in the Oil industry as the Presidential Liaison Officer (P.L.O) in all construction projects awarded by the Nigerian National Petroleum Corporation (NNPC) and all its joint venture partners.
    He stressed that this office is very important if Nigerian oil must be channeled to the right sources while not trampling on the well being of the indigenes of the region, adding that the absence of inspection companies like the Oceanergy, Globe Resources and others that left the country years ago has given room for theft of crude oil in large quantities, direct from the oil well. “What these sort of companies do include the inspection of civil construction, electrical, mechanical constructions like welding and also divers. You will see a lot of vessels on the high sea, even the Navy will think they want to berth because they are waiting for a turn to discharge petroleum products, but I tell you that some of these vessels carry divers who go under the sea to do welding jobs which Nigerians are expected to do, thereby denying citizens job opportunities.
    “Another thing is that we used to have companies that were electronically monitoring the distribution of crude oil from place to place; from one terminal to another terminal, from one flow station down to the terminal before it gets into the ships. They know what is going out and what is going down. The excuse that people are agitators are blowing pipes is fake.
    “What we need to know is the record of what is passing through each pipe, what are the challenges that the pipelines have which will lead to what we do in those, like pigging (Pipeline Inspection Gauge) which helps in clearing the wax in the pipeline. All these have stopped.
    “Unfortunately, when these stopped, it automatically stole the job slots of some Nigerians. When it comes to construction, before a company, for instance a Korean company, Hyundai Heavy Industries or Samsung Heavy Industries, want to bid, they will send their bidding documents to, for example, Chevron. Chevron will now inform the NNPC that these number of companies are now pre-qualified and we want you to approve the ones that are qualified.
    “You know what to consider when considering those that scaled through pre-qualification stages; firstly, the ones that submitted their community/ security plan, cashes policy, etcetera. Now, just like it is done in every other kind of documentation where people prepare a profile. They go to consultants that will provide a perfect community/ security management plan, then you call it a local content policy plan.
    “So, what they do at the business centre is to replace the name of the companies that were inside existing ones with this new one and then submit
    it. Then NNPC will send it to the organ that should be statutorily responsible
    for this job, which is the Nigerian Content Development Monitoring Board
    (NCDMB). In turn, the NCDMB should ideally go to the community to find out from the locales if the listed company came to you because they are biding for this sort of job. If the people say yes, what did you discuss with them, what kind of project did they tell you they are interested in doing? This is fact finding which these organs don’t do anymore.
    “Also, the environmental impact assessment which they publish regularly, did they really do their own cross-checking of the said environment?”
    He disclosed that as much as Nigerian Government remains the rightful owners of the Oil wells and are totally in full control of all the security apparatus, it is directly impacted once the problems of mistrust exist between the host communities and the constructions/oil producing companies and this always result to crisis, as evidenced in the Niger Delta. By this, it becomes pertinent that the Government becomes the direct provider of Government/Community Affairs and Security Management on all project sites and creation of conducive environment for the companies to operate peacefully while in their respective project sites.
    His words: “In fact, this now makes it mandatory for the Federal Government to be the domestic and grassroots providers of construction project execution Monitors/Enforcement Officers with regards to implementation of a well-articulated Government/ Community Relations and Security Management plans in all Oil and Gas Project sites in the various Host communities in Nigeria. This automatically places the Federal Government in a strategic position of Monitoring and evaluating the sincere implementation of the Nigerian Local Content Law as it positively affects the poor masses of Nigeria.
    “Furthermore, is that the Special Assistant to the President shall be among the formulators and also monitors of the full implementation/Enforcement of all project contract Agreement and Memorandum of Understanding signed by all concerned parties. This is imperative because all the foreign owned Oil and Gas construction companies don’t and never prepared to respect the passed Nigerian Content Act specifically because they are not directly in partnership with the Federal Government.
    “But in contrast, it is the Oil Producing Companies that respects the Nigerian Content Act because they have a partnership Agreement with the Federal Government through the Nigerian National Petroleum Corporation. Another unfortunate story in the oil industry is that the disease called corruption in the system grew to become a monster hurting the Oil and Gas Construction world. This is so because the Nigerian Managers in both at the NNPC and all the various Oil Producing Companies (i.e. Exxon Mobil; Chevron; Agip; Total; Shell etc) have togetherly turned the Oil and Gas industry into a money making machine.
    “By so doing, they influence the construction companies to divert most of the various project funds into their private pockets which in fact is always to the detriment of both the owners of the projects and the Host communities. The fact is that every project site is constantly faced with crisis and stoppage of works because the companies are always economical of the truth on matters concerning Community Affairs / Security Management Plans or Policy as agreed and stipulated in the various projects contract document.
    “They are forced into these negative acts because of the Public Affairs department of their various client (i.e. Chevron) have Cabal with which they use in draining project cost to the detriment of the host communities which people don’t know until when the project starts and the youths of the concerned host communities start agitating for their rights.
    “Also, the foreign Construction Companies are so greedy to the extent of withholding training Allocations, technological transfer and Job slot robbery caused due to the giving out of most of our (i.e. Nigerian) job slots to other Nationals (i.e. Philippines, Indians, Americans, Italians, Spanish, etc.), thereby reducing drastically the number of Nigerians employed or engaged in the various project sites.
    “These negative practices are made possible with the support and backings of the corrupt Nigerians, known as the Cabals, which includes some corrupt officers of both the Custom and Immigration Services that the Construction Companies used in providing fake foreign personnel information data for unqualified expatriates to get work permits illegally specifically with the intention of drastically reducing job spaces initially allocated for Nigerian youths in the various project Contract Agreements.
    “In addition is the falsification of imported facilities or materials / equipment import duty clearance document purposely to easily clear their goods from the Nigerian Sea Ports. The Cabals become more dangerous when being led by the corruptly imposed Governors from the Niger Delta states who provide both financial and security logistics to their various political thugs which they used in forcing themselves into the Government Houses but unable to provide the needed employment spaces or financial supports as promised during their respective election campaigns.
    “In fact, these Governors have turned the various project sites into their individual free Bank of Gangsterism. It is sad, what things have become in the oil industry.”
    Ones this office is created, Agaga, noted that the Officer shall report directly to the President through the office of the Secretary to the Government of the Federation on Local Content Enforcement Matters. “He shall also always act according to instructions and approval verbally or written from the Secretary to the Government of the Federation on all actions he wish to carry out while working in any of the companies,” he said.
  • Minister says NNPC wrong on petrol price hike

    Minister says NNPC wrong on petrol price hike

    The Minister of State for Petroleum, Dr Ibe Kachikwu, says the recent N4 increase in the price of petrol in Nigerian National Petroleum Corporation (NNPC) filling stations, is wrong.

    Kachikwu said this after receiving an award at an event organised by the Petroleum Products Pricing Regulatory Agency (PPPRA) in Abuja on Sunday.

    NNPC had been selling fuel at N141 but on Thursday, November 3 increased it by N4 to the government benchmark of N145.

    ”It is obviously humbling and too early in the day to receive an award and to be recognised so soon in some of the things we are trying to do. It is humbling, I thank them very much.

    ”First, I am not aware that the NNPC has increased the price. I need to look into that. It is a bit of surprise for me because there are processes in doing this if they have done that, it means they are doing it wrongly.

    ”Let me find out what the facts are,” he told newsmen.

    Kachikwu said the increase could be as a result of foreign exchange differentiation.

    He said there were areas within government controlled aspects like payments to the Ministry of Transport and the Nigerian Ports Authority that were foreign currency denominated.

    ”Having said that, the reality is that what we did at the point where we did some liberalisation, was to enable the free market float the price.

    ”Obviously, as you look at foreign exchange differentiations and all that, it would impact. The worst thing you could do is to go back to an era where we basically were fixing prices.

    ”What we ought to be doing was watching the prices, making sure that they are not taking advantage of the common man; making sure that the template is respected.

    ”One of the things I think we had hoped to do, which we should still do before we embark on any price increase is to work on those templates.”

    He, however, promised to discuss with industry operators.

    The minister said: ”those who are investing must be able to predict the pricing methodologies, the pricing consequences and the actions, to be able to justify their investments.

    ”At the end of the day, I think PPPRA is the one that has the authority to say it is time the template justified some level of movement.

    ”Otherwise, you have a crisis of individual decisions on pricing,” he said.

    On the issue of insecurity in the Niger Delta, Kachikwu assured that President Muhammad Buhari was committed to finding lasting peace in that region.

  • Nigeria lost N2tn to militancy, pipeline vandalism – NNPC

    Nigeria lost N2tn to militancy, pipeline vandalism – NNPC

    Renewed  militancy in the Niger Delta and oil pipe vandalism have cost Nigeria about $7bn, ( equivalent of N2.1tn) this year alone, according to the Nigerian National Petroleum Corporation (NNPC).

    NNPC Group Managing Director Maikanti Baru speaking at the 2016 Fiscal Liquidity Assessment Committee Retreat in Abuja put the total volume of crude oil thus lost to vandalism at 7000kpd.

    “Over 7000kpd of crude oil has been lost due to vandalism this year. A bulk of the loss is from JV assets,” Baru said in his paper “Global Oil Prices, Militancy and Terrorism and its Impact on Government Revenue in Nigeria.”

    “This implies that 60 per cent of oil production lost is NNPC-FGN equity.

    “At an estimated price of 45 dollars per barrel, the total 2016 revenue loss to the Federation Account translates to about 7 billion dollars.

    He said that apart from security challenges in the region, politics, judiciary, oil prices and production cost continued to impact negatively on the oil industry.

    He said the money lost in this process to “could have used to achieve major infrastructural milestones.

    “This loss is equivalent to a new 7,000mw power plant; new 350kpd refinery; over 30 per cent of National budget; and a new 1,700 kilometre pipeline.”

    To resolve this, Baru said the NNPC planned to increase security of oil and gas assets, improve its community social responsibility and the Amnesty programme.

    He said the NNPC planned “to renegotiate terms of Production Sharing Contract with deep offshore operating companies because with the current agreement, only 17.7 per cent of total revenue comes to government.”

  • No petrol price increase now- NNPC GGM

    No petrol price increase now- NNPC GGM

    The Group General Manager (GGM) of the Nigerian National Petroleum Corporation (NNPC), Maikanti Baru on Tuesday ruled out possibility of imminent increase in the pump price of Premium Motor Spirit (PMS), also known as petrol.

    There are online reports suggesting that the Federal Government will soon increase the price which was increased in May from N86 to N145 per litre.

    But speaking with State House correspondents at the Presidential Villa, Abuja, Baru said that he has not received any directive for increase.

    Noting that the request for forex for importation of petrol has been met, he declared that the supply situation for fuel is the country is robust and won’t push price increase.

    He said: “I have not been directed to increase pump price, even the other price was based on recommendation from the regulated body. I’m not aware that they are planing to do any increase, you know there are several factors that necessitated that especially the issue of exchange rate that has moved and we don’t expect any serious changes.

    “So far the request for forex for importation of gasoline popularly called petrol has been met, and our own supply situation is robust.

    “We are meeting demands. We have over 1.4 billion liters on ground. So I don’t see any basis for increase.

    “However, the review could be done by the right body, you should contact PPPRA, that is the regulatory body as far as petrol pricing is concern.” He added

  • Reps halt NNPC’s $400m loans bid for refineries

    Reps halt NNPC’s $400m loans bid for refineries

    The House of Representatives committee on Privatization and Commercialisation Wednesday stopped the bid by the Nigerian National Petroleum Corporation NNPC to acquire a $400 million loan for the upgrade of the four refineries in the country.

    The Hon. Ahmed Yerima- headed committee said the NNPC  was breaching Section 11 (g) of the Public enterprises ( Privatisation and Commercialization) Act 1999, which gives the National Council on Privatisation the power to do such

    Members of the committee said the NNPC shoukd suspend outrightly the proposed restructuring/Privatisation of the four refineries because of the breach of the regulations in the Bureau of Public Enterprises (BPE) as well as the Presidency’s delay in inaugurating the National Council on Privatisation (NCP).

    The committee said formally communicate President Muhammadu Buhari on the need to adhere to due process and avoid pitfall of commercialisation and privatisation exercises that were made in the past.

    The Committee noted that breach of policy guidelines and extant regulatory framework and undue rivalry among Government agencies is giving investors concern.

    According to NNPC document submitted to the Committee and obtained by our Correspondent, “in 2015, the refineries posted combined losses of N82 billion and processed only 8 million barrels of crude in total.”

    At the meriting yesterday, the failure of the NNPC management to present documents showing the approval allegedly given by the President for the proposed improvement of the refineries’ capacity utilisation to 80% within one year on the basis of the subsisting ownership structure, made members of the committee angry.

    Also the $50 million agreement signed by NNPC with a Chinese company, without any clear work plan got the disapproval of the lawmakers.

    Group Executive Director (Refineries) Anibor Kragah, who spoke for NNPC, said the report on the privatisation of the refineries, was not true.

    According to him, the “proposed investment proposals do not involve commercialisation or any transfer of ownership, assets, shares or control of the three refineries NNPC owed refining companies and are fully aligned with the current administration’s drive to ensure that the midstream and downstream sectors of the Nigerian Oil and Gas industry become self-sufficient in refining of petroleum products in the shortest time frame to ensure the country’s economic growth.

    “The need to rehabilitate the refineries is also in alignment with the aspirations of the National Assembly as communicated to NNPC at several engagements.”

    The refineries, he said, have recorded very poor performance over the last decade (30% average capacity utilisation vs global benchmark of 90%).

    He said NNPC does not need to subject the process to BPE approval, adding that that “BPE also shared its concerns on the viability of utilising JV arrangements for the rehabilitation exercise and the potential implications of the proposed activities on any FGN privatisation plans in future.”

    The exercise, Kragah said, has been put on hold in line with the directive of the House, adding that the Corporation has so far placed tender for investors to expressed interests.

    Vincent Akpotaire, BPE acting Director General however denied knowledge of the process, saying the privatisation of the refineries has always been part of the Bureau’s work plan tagged ‘potential transaction’.

    According to him, due to the political mood at the time due to the death of late President Umaru Yar’Adua, previous exercise for privatisation of 51% equity stake of both Kaduna and Port Harcourt refineries to Bluestat Oil Services Limited (preferred bidder) for $561 million and $160 million were truncated.

    Sales of the refineries were cancelled and the bid money refunded with accrued interests paid to the two bidders.

    He said there is the need to review the funding challenges in the oil and gas sector,

    “The glaring inefficiencies in the sector coupled with the bureaucratic nature of NNPC that the JV model has a gloomy future is very unlikely to succeed given the that it is the same agency and people that have been unable to run the refineries that will be called upon to regulate and supervise the joint venture operations.” Akpotaire said.

    Chairman of the committee on commercialisation and privatisation, Ahmed Yerima in his ruling directed BPE to take over the process and also directed NNPC to suspend all the activities put in place.

    He said without the relevant regulatory agencies, the committee House will not support the project.