The Nation Newspaper

Tag: NLNG

  • NCDMB, NLNG sign compliance agreement

    NCDMB, NLNG sign compliance agreement

    The Nigerian Content Development and Monitoring Board (NCDMB) and the Nigerian Liquefied Natural Gas Company (NLNG) have signed a service-level agreement (SLA) committing to compliance with the provisions of the Nigerian Content Act and timely approvals of documents.

    NCDMB Executive Secretary, Simbi Wabote and the Managing Director of NLNG, Tony Attah signed the documents on behalf of their organisations in Abuja.

    The SLA, first of its kind in the oil and gas industry, would be adopted as the template for managing documentations, contracting and expatriate quota between the Board and international and local operating companies.

    The agreement obligates NLNG to submit to the NCDMB documents like the quarterly job forecast, Nigerian Content plan, bidders list, Nigerian Content evaluation criteria and Nigerian Content technical bid, among others, while the Board has to respond on specific timelines. Should the Board fail to respond in accordance with the provisions of the SLA, NLNG can proceed with its tendering process after informing the Board in writing or email.

    The Executive Secretary acknowledged that NLNG’s operations were time sensitive, adding that the SLA would ensure that “NLNG is not exposed to violations and NCDMB is not a blocker to the business.”

    He said the SLA was a key strategy of shortening the contracting cycle, cutting the cost of projects and improving compliance with the Nigerian Content Act.

    Wabote explained that activities of the NCDMB impact on the business of the NLNG while the company’s operations also influence how the Nigerian Content Act is viewed by stakeholders.

    He also canvassed greater collaboration between the two organisations, requesting for NLNG’s support towards the development of a drydock facility in the Niger Delta region, to cater for the maintenance of big vessels, including LNG carriers.

    The Managing Director of NLNG praised the Board for the speedy development of the SLA, describing it as an innovative way of addressing the company’s concerns.

    He emphasised that NLNG was bound to comply with provisions of the Nigerian Content Act but was also pressed by the urgency required in making decisions for its business.

    Attah noted that the SLA provided an opportunity for consolidating the company’s collaboration with the Board and delivering on its mission of contributing significantly to the Nigerian economy.

    He recalled that NLNG recorded high Nigerian Content achievements in the construction of its last six ships as goods worth over $10 million were exported from Nigeria to South Korea and utilised on the ships.

    On the development of drydock facilities, Attah promised to work with the Board, adding that the company had previously constituted a consortium to identify and assess possible sites but was yet to make appreciable progress.

  • The NDDC/NLNG tussle

    Members of the Green Chamber of the National Assembly on May 9 defended the country’s national interest when it passed a bill which requires the payment of three per cent of annual budget of Nigeria Liquefied Natural Gas Limited, NLNG, into the coffers of Niger Delta Development Commission, NDDC.

    The amendment bill, promoted by Minority Leader, Hon. Leo Ogor, adjusts the Nigeria LNG (Fiscal Incentives, Guarantees and Assurances) Act. The House will now transmit the bill to the Senate for concurrence.

    In the new provision adds section 7b to the principal Act, which provides that “Notwithstanding section 7 or any other provision of this Act, the Nigeria Liquefied Natural Gas Limited shall pay 3% of its total annual budget to the Niger Delta Development Commission Fund as required by section 14 subsection 1 and 2b of the NDDC establishment Act, 2000.”

    Leading the debate on the NLNG Act of 2004, Leo Ogor, argued that with the untold environmental and health havoc wreaked on the people of the Niger Delta for decades, “the only way we can solve this problem is to bring relevant amendments to the Act because our people have suffered so much and I said that it is very important that we appreciate the enormity of the danger present in the region for us to act quickly and as a people, hold the NLNG responsible for unnecessary gas flaring using this amendment.

    “The amendment to this Act is aimed at redressing the great injustice that the NLNG has meted to the people of the Niger Delta region for almost 27 years now,” he said.

    “To partly or completely rejuvenate the environment, the NDDC establishment Act, specifically section 14 (2)(b), stipulates that three per cent of the total annual budget of any oil producing company operating onshore and offshore in the Niger Delta area, including gas processing companies like NLNG, shall pay the said percentage into the funds of the Niger Delta Development Commission.

    Surprisingly, the Nigerian National Petroleum Corporation, NNPC, has raised its voice in protest against the proposed amendment. The NNPC Group Managing Director, Dr. Maikanti Baru, said that the move against the NLNG would have negative effects on strategic projects like the Brass LNG as it would discourage investors. Of course many stakeholders in the Niger Delta maintain that this line of thought flies in the face of reason and justice.

    The stakeholders remind those who care to listen that the Niger Delta had suffered for too long and it was imperative that development agencies, such as the oil companies, the federal, state, local governments, the Ministry of Niger Delta Affairs and the NDDC, must collaborate at different levels to drive a regional development masterplan for the region.

    The NDDC had always joined forces with key stakeholders in confronting the enormous challenges of making a difference in the lives of the people in the remote communities of the Niger Delta. One of such collaborations is in the construction of the 29-kilometre Ogbia-Nembe road, which it is undertaking in partnership with the Shell Petroleum Development Company, SPDC.

    The N24 billion project illustrates the kind of challenges confronting the Niger Delta. It cuts through the swamps with 10 bridges and 99 culverts. The terrain is such that four metres of clay soil had to be dug out and then sand-filled to provide a base for the road. It shouldn’t surprise anyone therefore to learn that constructing a road in this tough environment costs twice or thrice what is required in other parts of the country.

    The NDDC Act states clearly how the commission shall be funded. Section 14[2] provides that “there shall be paid and credited to the fund established pursuant to subsection [1] of this section; [a] from the Federal Government the equivalent of 15 per cent of the total monthly allocation due to the member states of the commission from the federation account, this being the contribution of the Federal Government to the commission; [b] three per cent of the total annual budget of any oil-producing company operating onshore and offshore in the Niger Delta area, including gas processing companies; [c] 50 per cent of monies due to member states of the commission from the ecological fund…” and other sources such as grants and loans.

    The oil companies have also not been paying the three per cent of their annual budget as required by law. Records show that they deduct first charges before calculating the three per cent from the balance. Given the enormous impact of their activities on the environment, the oil companies are expected to be at the forefront in the critical task of urgently developing the oil basin that has suffered so much neglect in the past. It is, in fact, in their interest to develop the region where they operate in order to guarantee peace, which is very necessary for them to continue with their work.

    Among those that have expressed their frustrations over this state of affairs is the Bayelsa State Governor, Hon Seriake Dickson, who was obviously worried by the poor funding of the interventionist agency.

    He said: “The purpose of establishing the NDDC will be defeated if it is not in a position to undertake critical development projects in the Niger Delta; its purpose will be meaningless, if it will only award contracts for construction of classroom blocks and other jobs that may not have the capacity to impact the development of the area.”

    According to the governor, the major challenges in the Niger Delta were ecological and environmental and the realization of this fact should be reflected in the release of funds by the federal authorities. Sadly, this has not been so, thus limiting the capacity of the NDDC to fulfil its mandate of transforming the region that produces over 90 per cent of the country’s oil wealth.

    The Senate had since last year shown willingness to assist the NDDC to recover its outstanding funds.  The chairman of the Senate Committee on Niger Delta, Senator Peter Nwaoboshi, noted that proper funding would help NDDC adequately address the sustainable development of the Niger Delta region, stating that the challenge of developing the region was enormous and that all relevant contributors to the NDDC must play their roles diligently.

    “Senator Nwaoboshi said that the committee was ready to do all it would take, including amending necessary laws, where necessary, to ensure full compliance by agencies statutorily obligated to contribute funds to the NDDC.

    The Nwaoboshi-led committee swung into action shortly after, summoning the defaulting agencies to provide the much-needed explanations. It formally opened an investigation into the non-remittance of statutory contributions to the commission by the Nigeria Liquefied Natural Gas, NLNG and Ecological Fund Office.

    After its investigative hearing on February 3, 2016, Senator Nwaoboshi said that both the NLNG and Ecological Fund Office had starved the NDDC of its statutory funds for more than 15years, describing the failure of the agencies to remit required funds as fragrant abuse of the law setting up the NDDC.

  • Going for NLNG’s neck

    Going for NLNG’s neck

    As a child, one lesson my parents and teachers left me with is that you change or amend something to make it better. As  an adult, I have realised that not everybody shares this belief. At times, some people just want to change or amend things for reasons they may not even be proud to reveal. To justify their action, they will simply just look for a well-sounding excuse, which will carve them in the image of super heroes.

    You may wonder: what is he rambling about? It is all about Tuesday’s action of the House of Representatives on the NLNG Act. The Act, which started out as a military decree, has been in existence for close to 30 years. The House of Representatives amended it on Tuesday. The Senate is expected to follow. When this is done, our jewel of inestimable value and Bonny Island’s dearest, the Nigerian Liquefied Natural Gas (NLNG) Limited, will never be the same again.

    Bonny Island, where NLNG is located, was without form until Shell the light. Mobil saw it later. The Nigerian LNG Limited saw it over two decades ago when work started on Africa’s largest LNG plant. They all liked the place and the promise there. The Federal Government, which has interest in all of these ventures, too knows what the country stands to gain from Bonny Island, which hosts the country’s only port of origin.

    Of these companies in Bonny, NLNG seems dearest to the indigenes. It is their pride. Through it, they enjoy uninterrupted power supply, among other dividends. For Nigeria, it is both our pride and cash-cow.

    You will understand better what NLNG means to Nigeria if you listened to Nigerian National Petroleum Corporation (NNPC) Group Managing Director (GMD) Dr. Maikanti Baru  some months back on an NTA programme.

    To Baru, the Bonny NLNG is one of the biggest success stories of the oil and gas industry. This company, Baru said, has generated $90 billion revenue, $30 billion dividends and contributed four per cent to the country’s Gross Domestic Product (GDP).

    The model, which made NLNG a success, is, however, under threat from the National Assembly. Baru believes this move against the NLNG Act has dampened the optimism of investors in the industry.

    “The review of the NLNG Act by the National Assembly is causing a challenge for the Federal Government and the IOCs and it is sending wrong signals to the international community about how business is done in the country,” he said.

    The NLNG has been a darling and should be allowed to remain so. Let me cite this particular example: When President Muhammadu Buhari came in, the Federal Government initiated a bailout package for states owing their workers. The bulk of the money which made up the N400 billion package came from proceeds from the Bonny Island, Finima, Rivers State-based company.

    This darling, which was incorporated some 30 years ago but its first cargo of Liquefied Natural Gas (LNG) did not leave the Bonny Port until ten years later, rose so fast that it became the fourth largest supplier of LNG. The company has also paid over $5.5billion as Companies Income Tax, Tertiary Education Tax, WHT, VAT and PAYE. Regulators’ levies and other fees have led to the company coughing out over N51billion.

    The NLNG owns some 30 ships. It used to be 24 until six additional ships were delivered by Samsung and Hyundai dockyards. Through its second subsidiary, the NLNG Ship Manning Limited (NSML), the NLNG is the biggest employer of Nigerian seafarers on board its 13 LNG carrier ships. Also, the company has a wholly-owned subsidiary set up in 1989, Bonny Gas Transport (BGT) Limited, which provides shipping services for NLNG. The BGT was set up in Bermuda with an ordinary equity holding from NLNG Limited and preferential equity holding from the sponsors, NLNGs shareholders. Another wholly owned subsidiary of NLNG Limited is the NSML, which was set up in 2008 to provide, develop and manage high-calibre personnel for NLNGs maritime business.

    Former Coordinating Minister of Finance and Coordinating Minister for the Economy Dr. Ngozi Okonjo-Iweala visited the NLNG Plant on Bonny Island, Rivers State on November 15, 2013. She described the NLNG as an asset to Nigeria, a shining example of a successful company and a beacon of hope for a better Nigeria. She described the NLNG as the most successful Nigerian company with 49 per cent government ownership.

    Shell Gas BV (SGBV) controls 25.6 per cent. Total LNG Nigeria Limited owns 15 per cent and Eni International controls 10.4 per cent.

    The failure to take the final investment decision on its Train Seven has made it lose its pre-eminence in the global LNG market. There are imminent fears it will still dip further if its expansion plans are not concretised soon. And now the House of Representatives has thrown spanner in the works.

    As at the time it celebrated the export of its 3000th cargo on January 6, 2015, a large expanse of land, close to its Train Six in Finima, Bonny Island, was waiting for further action to house the Seventh Train of the plant. As a result of this, the NLNG, once the fastest growing facility in the world, has lost grounds to Qatar and Australia. Qatar has moved its output from 20 million metric tonnes to 80 million metric tonnes. Australia, from its previous 20 metric tonnes, now churns out 81 metric tonnes annually. NLNG is stuck at 22 million metric tonnes. Australia has 10 LNG projects, with 20 trains and $215 billion worth of final investment decision. Yet, Australia has only 60 percent of Nigeria’s gas reserves. Nigeria has gas reserves estimated at over 160 trillion cubic feet. The United States (U.S.), formerly a major LNG export destination, is now a net LNG exporter.

    The seventh train of the NLNG plant will bring in Foreign Direct Investment (FDI) estimated at over $8 billion, help reduce flared gas and improve the country’s revenue profile. With Train 7, the NLNG, said industry watchers, would provide about 10,000 jobs. Since it opened shop in Bonny, NLNG Limited has provided over 2,000 jobs each construction year and 18,000 jobs at the peak of construction. The government, they said, will also reap an additional $2.2 billion annually in dividend.

    What really does the National Assembly have against the NLNG Act? The National Assembly is trying to end the company’s status as dollar denominated, which was agreed on to protect the company against Naira’s flip-flop. The National Assembly also seeks to make its subsidiary, Bonny Gas Transport Company, pay tax in Nigeria. It also plans to make NLNG pay three per cent of its annual revenue to the Niger Delta Development Commission (NDDC), pay three per cent of gross freight on international inbound and outbound cargo to NIMASA, pay two per cent of contracts performed by companies engaged in cabotage and pay one per cent of any contract award upstream to the government.

    This Act under threat is a contract between the Federal Government and the NLNG shareholders. The thrusts of this contract include incentives, concessions, guarantees and assurances, which were reaffirmed in Letters of Assurance to lenders for the Nigeria LNG Trains 4 and 5 expansions by the Ministry of Finance, Ministry of Justice and the Central Bank.

    The incentives, concessions, guarantees and assurances are not uncommon in the global LNG industry. They are used in countries, such as Qatar, Oman, Malaysia, Angola and others to support and grow their LNG plants. The guarantees are to assure foreign investors that their investments will be protected.

    What those asking NLNG to pay the NDDC Levy seems to have forgotten is that the levy is aimed at upstream oil and gas producers. NLNG does not produce gas. It buys gas from producers and liquefies it. If it pays the levy, it amounts to the government taking money twice for the same purpose; one from the producer and two, from the client. The NDDC pursued the matter up to the Supreme Court and it lost.

    These alterations planned by the National Assembly are against the guarantees and assurances Nigeria entered into with the United Kingdom, the Netherlands and others. The National Assembly needs to forget its feeling that the NLNG is enjoying a rare privilege. Firms in free trade zones enjoy almost absolute exemptions from taxes and levies. NLNG enjoys partial exemptions. Since 2010, it started paying Companies Income Tax, because its exemption from this expired in 2009.

    The sponsors of the amendment believe the NLNG has cheated the people of the Niger Delta by not contributing to the purse of the Niger Delta Development Commission (NDDC). As far as they are concerned, the reasons of the NLNG on why the amendment should not sail through are balderdash. The House of Representatives by its action on Tuesday has sanctioned this belief. Will the Senate follow? The signs indicate so.

    My final take: President Muhammadu Buhari should not sanction the amendment. Anything that has the potential of weakening the NLNG should be avoided. The company is our shining light and is run on international best practices, to the best of my knowledge. This is acknowledged globally, a situation which makes the Bonny-based firm to have a better international credit rating than our dear country.

     

    …This is a revised version of my column of March 17, 2017.

  • NLNG kicks as Reps amend Act

    NLNG kicks as Reps amend Act

    YESTERDAY’s amendment to the Nigerian Liquefied Natural Gas (NLNG) by the House of Representatives has been rejected by the company.

    In a statement, the General Manager, External Relations Division of NLNG Limited, Kudo Eresia-Eke, said the amendment would sway investors’ interest in the country.

    The statement reads: “Nigeria LNG Limited (NLNG) notes that the Federal House of Representatives today passed a bill for the amendment of the NLNG (Fiscal Incentives, Guarantees and Assurances) Act.

    “As we have said previously, including at a public hearing convened by the National Assembly in April 2016, we do not believe that this is in the national interest, as its direct consequence would be to project Nigeria as a sovereign-state promise breaker and an unsuitable destination for investments.

    “The amendment violates the Assurances and Guarantees granted the investors by the country, and reinforced by successive governments, which paved the way for the huge international investment that enabled the company to become a reality and the success story it is today.

    “The main thrust of the Guarantees and Assurances were to assure the foreign investors that their investments would be protected by the non-amendment of the NLNG Act. This is the reason why the NLNG Act has remained intact and protected by all administrations from inception, in recognition of the sanctity thereof.

    “Reacting to the news of the said passage of the amendment by the House of Representatives, the Managing Director of Nigeria LNG, Tony Attah, said the proposed amendment can only be a direct attack on the present Government’s Ease of Doing Business Agenda and in the current administration’s determination to attract direct foreign investment to Nigeria.

    “It needs to be clearly stated that INVESTMENTS are unlikely to flow into an environment where contracts and agreements are flagrantly violated as is imminent in this instance.

    “By way of background, the Niger Delta Development Commission (NDDC) Act has its origin in the need to address the adverse effects of upstream oil and gas exploration and production activity –specifically oil spills and gas flaring – as well as the development needs of the Niger Delta region.

    “For the avoidance of any doubt, NLNG does not prospect for or extract gas from the ground. The Company buys feed stock from its gas suppliers, which it proceeds to clean and cool for sale.

    “As such, the company is like any manufacturing, petrochemical or refining firm that uses gas as feedstock, and there are quite a number of them in the Niger Delta. We are unaware that any other company is being targeted as NLNG apparently is.

    “NLNG helps to convert and monetise gas for the benefit of the environment, shareholders and other stakeholders including the Government and Nigeria.

    “Nevertheless, NLNG has since inception continued to pay applicable taxes, levies and charges to local, state and federal tiers of Government amounting to well over $5.5 billion. This is besides about the $15 billion already paid in dividends to the Federal Government through the NNPC.

    “In addition, we operate a robust corporate social responsibility programme, considered to a model by the rest of the oil and gas industry. The programme has cost about 200 million US dollars to date and extends to areas including business and human capacity development and infrastructure development in our primary areas of operation and across Nigeria.

    “It is instructive that NLNG was operating a Nigeria scholarship scheme even before it exported its first cargo in 1999/2000. More recently, the company has spent 12 million US dollars to donate engineering laboratories and equipment to 6 universities across Nigeria’s geo-political zones, to support science and technology teaching and research. In addition, NLNG currently supplies 40 per cent of the nation’s cooking gas (LPG) while also providing scholarships to Internally Displaced Persons (IDPs) in the North-East of the country.

    “This curious amendment initiative represents the first time in the history of legislative practice in Nigeria, when a law is amended for the sole purpose of imposing a levy against a private company for the benefit of an agency of government.

    “The current National Assembly is strongly urged not to inadvertently lend itself to the establishment of such an unjust and potentially damaging precedent. Moreso when the said agency in this instance had lost its claim in the courts, including the Supreme Court of the land.

    “As a private company with the vision to help build a better Nigeria, we are aware that courtesy of the referenced assurances and guarantees as well as the regulations and provisions of the law, shareholders and NLNG have the right to pursue the protection of our business interests as provided for under the same regulations and the law.

    “NLNG wishes to state that should the need arise it shall seek that protection under the law.”

  • Nigeria can become global gas giant, says NLNG

    Nigeria can become global gas giant, says NLNG

    The Managing Director and Chief Executive Officer of Nigeria Liquefied Natural Gas Limited (NLNG), Tony Attah, said Nigeria can be a top gas producing country, with a potential to increase its LNG market share.

    He spoke during the public presentation of the company’s facts and figures in Lagos.

    For that transformation to be, Attah said the right business environment needed to exist. He referred to the proposed amendment of the NLNG Act by the National Assembly, which he said, would jeopardise the aspirations of making Nigeria global gas leader.

    He said: “The Nigeria LNG Limited (NLNG) Fiscal Incentives Guarantees and Assurances Act (NLNG Act) allowed investments to flow into the country. It provided investors the confidence that any agreement entered into would be respected and preserved. To amend the Act will not help Nigeria in developing its vast gas resources, NLNG and its hopes for expansion. It will erode investors’confidence that the Act provided in the first place.”

    Attah said opportunities, such as the expansion of NLNG’s Bonny Island Plant with Trains 7 and 8, could be a catalyst to unleashing the country’s gas potentials.

    He said it was time for Nigeria to use gas to spur industrial and economic transformation. He, however, warned that some challenges might slow down progress towards achieving the country’s dreams, citing the proposed amendment of the Nigeria LNG Limited (NLNG) Fiscal Incentives, Guarantees and Assurances Act (NLNG Act) by the House of Representatives as a potential show-stopper.

    “If the amendment is passed, the NLNG expansion project will be jeopardised and Nigeria will lose investments of US$ 1-3billion annually in the Upstream to enable NLNG maintain production capacity and gas developments. It means an immediate loss of foreign investment totalling US$25 billion in respect of Train 7 and 8 investments. Another impact will be the potential loss of about 18,000 jobs required for the construction activities of the Trains.

    “An amendment or change in the NLNG Act portrays Nigeria as a promise-breaker and untrustworthy, damaging the country’s reputation and hamstringing its ability to attract foreign investment,” he added.

    Attah cited Oatar’s journey into becoming a global gas giant. He said:  “Qatar started to ship LNG in 1997, two years before Nigeria. But you have to be awed by what the country has achieved since then. Today, oil and gas, and principally LNG, is the foundation of Qatar’s economy; and account for more than 70 per cent of total government revenue, and more than 60 per cent of GDP, as well as roughly 85 per cent of export earnings.

    “Qatar has LNG capacity of about 77metric tones per annum (MTPA), and generates revenues of about $91 billion per year. Gas was the catalyst for transformation of a small emirate to a global economic powerhouse. This will give you a feeling of what can happen when you focus on gas.”

    LNG, Attah said, contributed to reducing gas flaring from 65 per cent to less than 20 per cent, adding that all the benefits from Nigeria LNG, including financial contributions, among others, would be in jeopardy with the proposed amendment by the National Assembly, he said.

  • Fed Govt, NLNG begin talks on N120b Bonny-Bodo road

    After decades of  proposing to construct the Bonny-Bodo Road in Rivers, the Federal Government and the Nigeria Liquefied Natural Gas (NLNG) Limited have started discussion on the take off of construction of the road.

    NLNG Managing Director/Chief Executive Officer, Mr. Tony Attah, told The Nation that the company is working with the Federal Government through the Ministry of Power, Works and Housing to conclude on the commencement of construction of the road put at  N120 billion.

    He said the NLNG would bear 50 per cent of the cost of the road construction, which translates to N60billion. The 39-kilometre road will be the channel to connect the Bonny Island – NLNG’s host community – to land.

    The Bonny Road is a Federal Government’s project, which has been on the drawing board since the 1970s. But to expedite action on it, the Nigeria LNG offered to partner the government by providing 50 per cent of the cost of the project.

    Attah also noted that the NLNG was progressing with its plans to make Bonny a mini Dubai in the next 25 years.

    According to him, in 1998, the Joint Industry Companies (JIC), made up of NLNG, Shell Petroleum Development Company Limited (SPDC) and ExxonMobil, signed a Memorandum of Understanding (MoU) with Bonny Kingdom.

    This MoU provided a framework, which enabled the JIC to pool resources and provide the kingdom with Bonny Master Plan, the 1.5kilometre by-pass road, the 1.2kilometre access road, uninterrupted electricity and potable water supply managed through a special purpose vehicle called Bonny Utility Company.

    “Over the years, more than $182million has been spent by the JIC in delivering development projects on the Island,” he added.

  • NLNG’s dividend to govt dips 50% on oil price, militancy

    NLNG’s dividend to govt dips 50% on oil price, militancy

    The financial performance of the Nigeria Liquefied Natural Gas (NLNG) Limited dipped last year on global low oil prices and heightened militant attacks in the Niger Delta.

    While the fomrer started since late 2014, militant attacks peaked early last year resulting in bombing of pipelines including a major gas supplier to NLNG.

    According to the 2017 facts and figures presented to reporters in Lagos yesterday by the management of NLNG led by the Managing Director, Mr. Tony Attah, the company dividend paid to the Federal Government from last year’s operations was $356.1million compared to $1.043billion in 2015, $1.390billion in 2014 and $2.769 billion in 2012.

    The various taxes paid by the firm also plunged. The company income tax (CIT) and education tax (ET) in 2016 dipped to $323.27million from $2.170billion in 2015 and $1.402billion in 2014. Also pay as you earn (PAYE) dropped to $31.322million in 2016 as against $42.842million in 2015 and $46.903million in 2014. However, value added tax (VAT) was higher last year at $24.598million compared to $20.156million in the previous year, $23.976million in 2014 and $165.483million in 2012.

    Attah said since the inception of the company, over $90billion has been generated as revenue, while $15 billion has been paid to the Federal Government as dividends. Also $5.5 billion has been paid to the government in taxes and $13billion for feed gas purchase.

    The NLNG chief said the firm is moving with its plan of developing Bonny – its host community – into Nigerian Dubai. The 25-year development master plan expects Bonny to become mini-Dubai by 2040. Accenture Group is doing the thinking with NLNG on how to actualise the goal, he said.

    Attah also reiterated the need for the National Assembly not to proceed with the proposed amendment of the NLNG Act. According to him, such a step will cost Nigeria a lot of investments and jeopardise future investments by NLNG including Trains 7 and 8 expected to bring $25billion investment, increase the firm’s capacity from 22 million tonnes per annum (mtpa) to 30mtpa, create 18,000 jobs and push up domestic liquefied petroleum gas (LPG)  supply capacity from 250 tonnes to 1.0mtpa.

    Besides, he explained that the primary aim of the National Assembly to amend the NLNG Act, which was to compel the gas company to pay the Niger Delta Development Commission (NDDC) levy, does apply because NLNG does not produce gas. It only buys gas just like a fertiliser or petrochemical company, he added.

    The NLNG management, it was learnt, has been meeting with the relevant committees of the National Assembly to explain these facts to them and also make them see the entire scenario from the same lens as the gas giant.

  • NLNG chief now NESG board member

    NLNG chief now NESG board member

    The Managing Director and Chief Executive, Nigeria Liquefied Natural Government (NLNG), Mr. Tony Attah, has been appointed to the Board of the Nigerian Economic Summit Group (NESG).

    NESG is a leading private sector Think-Tank and Policy Advocacy Group committed to the development of a modern globally competitive Nigerian economy

    The group is the convener of the Nigerian Economic Summit, an annual event and a platform for Chief Executives and experts from the public and private sectors to brainstorm and build consensus on policy options and implementation frameworks.

    The NESG engages government, the private sector and civil society on key development issues and economic policies in Nigeria. The strategic roles of the group include those of being a dialogue partner, shaping policy through public debate, instituting change through influence, shaping policy through research and advocacy, and instituting change through influence that mobilises action.

    According to NLNG spokesman, Kudo Eresia-Eke, Attah brings with him, over two decades of oil and gas industry experience to the NESG Board. Before his appointment as NLNG chief executive in September 2016, he was the Managing Director and Board Chairman of Shell Nigeria Exploration and Production Company (SNEPCo), Vice President Health, Safety and Environment (HSE) and Corporate Affairs, Vice President Human Resources (HR) as well as other technical & non-technical roles in operations and major projects at Shell.

    Over his distinguished career across Europe, Russia and Africa, Tony has led multi-disciplinary teams across diverse cultures. He is recognised for his strong strategic and commercial mind-set which is underpinned by a solid technical background and excellent leadership capabilities. He is a member of Council for the Regulation of Engineering in Nigeria (COREN) and Society of Petroleum Engineers (SPE), and a fellow of the Nigerian Society of Engineers (NSE), Eresia-Eke aadded.

  • NEITI urges FG to recover $21b

    NEITI urges FG to recover $21b

    The Executive Secretary, the Nigeria Extractive Industries Transparency Initiative (NEITI), Waziri Adio Tuesday called on the Federal Government to recover over $21billion unremitted fund disclosed by its independent report of the extractive industry.

    He made the call in Abuja, during an interactive session with the media, where he highlighted the policy brief, which focused on economic recovery and unremitted funds by the Nigerian National Petroleum Corporation (NNPC) and it’s upstream arm, Nigerian Petroleum Development Company (NPDC).

    According to NEITI, “findings from series of audits of the oil and gas sector carried out by the NEITI shows that NNPC and its upstream arm, NPDC, have failed to remit $21.778 billion and N316.074 billion to the Federation Account”.

    These according to the report, are amounts due from three main sources that includes: federation assets divested to NPDC and NPDC’s legacy liabilities payment for domestic crude allocation to NNPC and dividends from investment in Nigerian Liquefied Natural Gas Company (NLNG) paid to the NNPC, but NNPC has however withheld the said funds.

    These unremitted funds falls under the categories of the full payment for the 12 oil mining leases (OMLs) divested from the shell and Agip ventures. NNPC divestment of 55% of its stake in the shell JV valued at $1.8billion by the Department of Petroleum Resources (DPR).

    The audit also revealed that cash calls amounting to $552 million were erroneously paid on these divested assets by the National Petroleum Investment Management Services (NAPIMS), the investment arm of NNPC.

    The NPDC is said to have made a refund of $424 million to NAPIMS but not refunded to the federation account, the brief added that NPDC is yet to refund $148.278 million and 2.42 billion from the cash calls mistakenly paid to it.

    The brief also revealed that” unremitted revenues in this category relates to arrears of liabilities of taxes, royalties and levies. Leaving the amount owed by the NPDC at $5.531 billion and N72.435 billion.

    The brief disclosed that NNPC in its defence explained that ‘withholds DCA earnings to pay for downstream related operational costs and subsidies’, however, NEITI says there are serious doubts about such withholding as they regularly exceed actual subsidy costs.
    waziri called on the government to recover these money and use it for economic recovery and to put the economy on a sound and sustainable footing.

    He added that OMLs that have not been fully paid for, should be retrieved from the NPDC, revalued and auctioned so that the country can get proper value for the OMLs.

    The brief, in its action point, called on the federal government to investigate the status and use of NLNG dividends from 2004 to 2014 bad undertake criminal proceedings against anyone found wanting.

  • NLNG eyes global shipping leadership status

    NLNG eyes global shipping leadership status

    The Nigeria Liquefied Natural Gas Limited (NLNG) said it is relying on the strategic deployment of skills and technology to power its transformation into global maritime industry leader, the firm’s General Manager, Shipping,Capt Temilola Okesanjo has said.
    He said NLNG Limited has, since the commencement of its operations in 1999, chartered-in 45 vessels including LNG, liquefied petroleum gas (LPG) and condensate carriers, for the shipment of its products to buyers across the globe and chartered- out five of its own vessels to other operators in the market.
    Okesanjo said: “NLNG currently operates the largest fleet of LNG carriers in the country and has within in its operations portfolio, a total of23 vessels, three different ship owners and four fleet managers, making the company a formidable player in the chartering market even as it continues to deploy skilled manpower and cutting edge technology for sustainable growth.”
    Speaking on the sideline of the Multimodal (Logistics) West Africa Conference in Lagos, he said NLNG shipping operations have had to adapt quickly and cost-effectively to a progressively more challenging and competitive global maritime market, especially in the aftermath of the Fukushima nuclear incident in Japan in 2011.
    “One of the primary impacts of Fukushima was the need for cargo diversions, sometimes away from traditional routes and an increase of voyage distances to discharge ports in the Far and Middle East as well as adjustments to operating capacity requirements as a whole. All this is in our endeavour to find profitable takers for the 22 million tons per annum capacity of our six train production plant at Bonny.
    “Today, the shipping aspect of our business is being positioned for emerging market opportunities through a revamped chartering structure designed to optimise available shipping capacity.
    “The evolving market conditions demand flexible shipping portfolios as conventional shipping structures are being challenged.
    “With eleven buyers on 16 contracts to base destinations in Europe and North America, including Spain, France, Portugal, United States (US), the company has realised considerable revenue from opportunistic diversions and sub-charters,” he added.
    According to Okesanjo, NLNG’s operational modality involves the provision of adequate shipping capacity to lift contractual volumes from NLNG terminal at Bonny in Rivers State, facilitating the implementation of diversion requests to longer distances being proposed by buyers, and enabling the sub-charter of surplus capacity when applicable to ensure full utilisation of capacity and competitiveness.
    As part of an ambitious fleet regeneration initiative, he said, NLNG retired six vessels built between 1977 and 1982 which were replaced by six modern technology Tri-Fuel ones built by Samsung and Hyundai Heavy Industries of South Korea and delivered between 2015 and last year.