The Nation Newspaper

Tag: NNPC

  • NNPC restores gas supply to power plants

    THE Transmission Company of Nigeria (TCN) yesterday in Lagos said gas supply to generating stations had built up gradually after the Nigeria National Petroleum Corporation (NNPC) restored a ruptured pipeline.

    TCN General Manager, Public Affairs Mrs. Ndidi Mbah said within a day, power supply would be restored to normal.

    Mrs. Mbah said an indication that gas supply had improved was the increase in power generation into the National Grid to 3,876.9 Megawatts as at 17.00hrs on Monday, as reported by National Control Centre (NCC).

    “TCN wishes to use this opportunity to commend NNPC, especially Nigerian Gas Corporation (NGC) for the quick intervention.

    “The company also appreciates the Ministry of Power, Generation Companies (GENCOs), Distribution Companies (DISCOs) and electricity customers for their cooperation during the crises period,” she said.

    According to Mrs. Mbah, as soon as the gas build up is completed, the affected generating stations would resume normal generation into the national grid.

    The general manager said through the implementation of Transmission Rehabilitation and Expansion Programme, TCN was building new substations as well as upgrading existing ones and transmission lines all over the country.

    “This is expected to further stabilise the grid and also put necessary flexibility and redundancy in line with N-1 capacity.

    “TCN will continue to count on all Nigerians for support and understanding as it continues to expand the nations’ grid,” she said in a statement.

    TCN, on June 15, said rupture of a major NGC pipeline had scuttled the delivery of gas to six power plants.

    It said this led to a drop in power generation by 1,087 megawatts and compelled the company to embark on load-shedding.

    It stated that the load-shedding was adopted to maintain stability of the national grid, thus avoiding total power system collapse.

    The affected power stations included Ihovbor, Azura, Omotosho gas, Geregu gas, Olorunsogo gas, Sapele and Egbin Power Station, which has managed to generate 60MW only on each of its units, losing a total of 211MW.

     

     

     

     

  • No fuel price hike, says NNPC

    There won’t be increase in fuel price, despite the rise in the landing cost of imported fuel, Nigerian National Petroleum Corporation (NNPC) Public Affairs Group General Manager, Ndu Ughamadu, has said.

    He said the landing cost goes up when the international price increases, adding that it is a normal occurrence in the global crude oil market.

    He said the government has fixed N145 as official pump price for premium motor spirit (PMS) or petrol, adding that marketers were free to sell it at either the regulated price or below it, depending on market forces.

    In an interview with The Nation Ughamadu denied any increase. He said: “NNPC is yet to give Nigerians the new landing cost of fuel as it is not within its responsibilities to do so. The responsibility of letting the country know what the new landing cost of fuel lies with the Petroleum Products Pricing Regulatory Agency (PPPRA) and being a Federal Government owned- parastatal like NNPC, NNPC cannot exercise control over what the PPPRA does or is expected to do in the Nigeria’s oil and gas industry.

    “The global oil industry moves or operates in line with the market forces. Once there is rise in the global price of crude oil, related activities move in similar direction. That is why the increase in the price of crude and its attendant rise in the price of brining the product to Nigeria do not bother us (Nigeria) much.  Traditionally, refiners of crude abroad ten to increase the cost of processing crude oil into finished products like Premium Motor Spirit, Kerosene and Diesel, when the price of crude rises at the global market.”

    He said the landing cost had increased in the second quarter of the year compared to the first quarter.

    The landing cost as at last December 22 was N171.4 per litre when the price of crude was $64 per barrel. At over $80 per barrel, the landing cost would be well above N180.

    He said the price of crude was below $50 per barrel in the first quarter, stressing that the price of crude is $81 per barrel. He added that the country should expect increase in the landing cost of fuel. According to him, the government, has huge under-recovery to battle in view of the rise in the landing cost.

    Ughamadu said the under-recovery rate is the gap between the cost of buying fuel abroad and the that of selling it at home. He said the government has been subsidising the cost of importing fuel, adding that the corporation was doing to avert fuel scarcity its attendant strains on the economy.

    He said the level of fuel imports by NNPC had grown, adding that the country consumes a little over 50million litres of fuel.

    It would be recalled that the government has taken over fuel import as marketers don’t find it profitable to import, especially without subsidy reimbursement.

  • IPMAN urges FG to increase supply of kerosene

    The Independent Petroleum Marketers of Nigeria ( IPMAN ) has called for increased supply of Kerosene in the country.

    Chief Ikechukwu Nwankwo, chairman of IPMAN, Enugu Depot made the call in an interview with the News men on Wednesday in Awka.

    Nwankwo decried the fact that marketers have not been able to source the product from the NNPC depots while it is exorbitant at the private depots where it is available.

    Nwankwo however lauded the Federal Government for the normalcy it has brought to the supply and distribution of Premium Motor Spirit (PMS) and called for similar action on kerosene.

    He said though Kerosene is a deregulated product, its scarcity have continued to put pressure on the price.

    The chairman said some of his members who paid money at the depots for about two weeks were yet to take delivery of their products.

    He said that Kerosene which is the primary source of domestic fuel should not only be available but affordable.

    “Kerosene is scarce; the Federal Government should increase supply massively.

    “We rely on private depots for the product and every other week and months they come up with new prices, just last week, a litre of kerosene was N240.

    Read Also: IPMAN seeks increased fuel supply

    “It is not good for our business; and how can the common man who rely on kerosene be paying N250 for a litre, that is if they are able, because most marketers don’t have the product.

    “Kerosene is a deregulated product but it can only be effective if it is available because it is only what is imported that we can distribute,” he said.

    On the Enugu petroleum depot, Nwankwo said it was unfortunate that it has been moribund for over a decade.

    He said the governments of Anambra, Ebonyi and Enugu states which are primarily attached to the depot should rally round and partner the Federal Government to reactivate the depot.

    He said there was no basis for the depot not to be operational.

    “Governors of the South East, especially those of Anambra, Ebonyi and Enugu that are attached to the depot should work with the Federal Government to fix the depot.

    “This will help distribution in the area, because depot members suffer loss of money and property to accident because of the long distance we travel to procure products,” he said.

    NAN

     

  • NNPC: petrol landing cost exceeds N171 per litre

    • Firm denies fuel subsidy existence

    The Nigerian National Petroleum Corporation (NNPC) yesterday cried out over the increase in the landing cost of petrol. The state-run oil firm lamented that the cost has exceeded N171 per liter while the pump price remained regulated at the maximum of N145 per liter.

    The last known landing cost of the product was N171 per liter which is an indication of N26 per liter under-recovery cost.

    The prices of crude oil had recently risen to about $80 per barrel, which has a direct effect on the landing cost of petroleum products.

    But in December last year when the price was $64.37 per barrel, the NNPC Group Managing Director, Dr. Maikanti Baru said the landing cost, which include product cost, insurance and freight was $620 per metric ton. He said the country’s daily consumption had risen above 50million liters per day too.

    Meanwhile, its Group General Manager, Group Public Affairs Division, Mr. Ndu Ughamadu, who spoke with The Nation on phone, rejected the description of the payment of under-recovery as subsidy.

    He said: “As you rightly pointed out in your question, once the prices of crude oil go up in the international market, it affects the prices of product in the international market.

    “And equally it affects the landing cost. The gap has really widened but the real figures I don’t have here because I am not here in the office.”

    But the spokesman later told this correspondent on phone that “it is only the PPPRA (Petroleum Product Pricing Regulatory Agency) that can give you the figure.”

    Upon visit to the website of the PPPRA, the pricing template space was blank.

    Asked to state why the space was blank, agency’s General Manager, Corporate Affairs, Mr. Agie Apollo, said management has directed the department to revive and update it on daily basis.

    The PPPRA spokesman was reticent on the under-recovery cost of petrol. He however said:  “The website is like almost as dead. In short, we need to upgrade and update it on daily basis. I just finished talking to the person who is in charge of the updating of the website.”

    But according to Ughamadu, it is only the National Assembly that can appropriate subsidy. He explained that the NNPC has only said it is not recovering the full amount for the petrol it sells to the public.

    “We have never said we are operating a regime of subsidy. Once you mention subsidy, it is only National Assembly that can appropriate for subsidy. What we have been saying is that we are operating a regime of under-recovery. In other words, we are not recovering the full amount we sell to the public.”

    From all indication, the NNPC was evading the question by referring The Nation to the PPPRA since it is the sole importer of petrol and only it knows how much it spends on importation.

  • Buhari directs NNPC, oil firms to release fund for Ogoni clean-up

    PRESIDENT Muhammadu Buhari has directed the Nigerian National Petroleum Corporation (NNPC) and oil companies to release fund for the clean-up of Ogoni communities.

    Minister of State for Petroleum Resources Dr. Emmanuel Ibe Kachikwu said this yesterday in the first part of an eight-part series Podcast focusing on the Niger Delta and security.

    He said the President was committed to the success of the Ogoni clean up and that his ministry is working with the Ministry of Environment to continue the exercise.

    His words: “The president is completely committed to the success of this. And we are working with the Ministry of Environment to continue the Ogoni clean up. The President has just directed that funds necessary for this must be released within a very short period of time so that this Ogoni clean up can actually move from the drawing board to actual practical reality. In fact, both the oil companies and NNPC are to fund this sufficiently for us to move forward.”

    The minister added that the ministry has begun a programme to secure the participation of Ogoni people, when there is any problem.

    The plan to make communities have faith in the government, according to the minister, was not restricted to Ogoni.

    Kachikwu said the government is working on a framework for a community-based participation in oil and gas pipelines and  assets.

    He said following realisation from inter-agencies researches that challenges were still lingering in the Niger Delta after $40 billion was spent in the region in last 15 years, the ministry is working with the Office of the Vice President and the Ministry of Niger Delta.

    Others are  Niger Delta Development Commission and the NNPC.

    The aim, he said, is to engage in more capacity building and economic empowerment.

    Kachikwu said from reports, the ministry has checked past expenditure and available funds in the Niger Delta states.

    The minister noted that technical committees have been set up in Edo, Delta and Imo states, with the governors as chairmen, to look at the volume of oil available and produced in the areas as well as the opportunities, economic empowerment and topical issues in the states.

    The committee, which has oil companies, the ministry and government agencies as members, will also carry out the assessment in other oil producing states to develop a blueprint for engagement and intervention in the region.

    “If we succeed in doing that, for the first time, what we are going to have is a complete blueprint, complete local engagement, complete intervention and supervision of the Niger Delta Development module. And that is something that can be sustained for posterity,” Kachikwu said.

    The minister added that his ministry has approved the establishment of 10 modular refineries of which two have began construction.

    Kachikwu affirmed that the two modular refineries, sited in Kwale in Delta State and Ogbere, Rivers State, will start yielding results within one year.

  • NNPC retail eyes 30% market share

    The Nigerian National Petroleum Corporation’s (NNPC) Downstream subsidiary, NNPC Retail Limited, has been directed to target 30 per cent market share of petroleum products distribution business by 2020.

    NNPC Group Managing Director, Dr. Maikanti Baru, handed down the directive yesterday  in Abuja during the unveiling ceremony of brand new logos for four of its downstream subsidiaries: Petroleum Products Marketing Company (PPMC), Nigerian Pipelines and Storage Company (NPSC), NNPC Retail Limited and NNPC Shipping.

    Baru said the target would enable efficient products distribution and price stability across every nook and cranny of the nation, even as he added that by that time NNPC Retail Ltd would also extend its businesses to other neighbouring states in the West African sub-region.

    Currently, the Corporation’s downstream company holds about 14 per cent market share of the nation’s products distribution network.

    “In making the choice to rebrand these entities, we are taking a huge step towards enhancing our corporate reputation, improved profitability, sustainable growth and most importantly, capture a larger share of the market across the entire downstream value-chain,” Dr. Baru said.

    According to him, re-branding the four companies also prepares them for more competitiveness in the downstream sub-sector, in line with the corporation’s 12 Business Focus Areas (BUFAs).

    He informed said the NNPC was committed to ensuring that PPMC as a flagship national products marketing company becomes more profitable and crucial to meeting the nation’s energy demands.

    Baru added that NNPC was working assiduously towards bequeathing an NPSC that would brim with revamped infrastructure for efficient storage and distribution of petroleum products across the nation, thereby ensuring supply reliability and energy security.

    The NNPC helmsman noted that it was the corporation’s key aspiration to strengthen its shipping outfit to support the downstream growth objectives of its subsidiaries, saying the corporation would not relent until NNPC Shipping becomes the partner of choice in the marine transportation and logistics business.

    He said: “The Downstream Sector is one critical aspect of our business upon which we are readily assessed by majority of our stakeholders nationwide and in the international market environment, making it imperative for the corporation’s long-term survival and image.”

  • Governors threaten to takeover fuel subsidy payment from NNPC

    National Economic Council (NEC), comprising the 36 State Governors in the country has threatened to take over the responsibility of subsidising petroleum products in their states based on consumption following the huge amount of money being spent by the NNPC as fuel subsidy payment annually.

    The Chairman of Governors’ Forum, Gov. Abdulazeez Yari of Zamfara who stated this while responding to questions after the meeting of NEC which was chaired by Vice-President Yemi Osinbajo at the presidential villa, Abuja on Thursday, said the governors would next month (June) take decision on whether to take responsibility for the subsidy in their states or not.

    He described as outrageous the N800billion being expended by the NNPC as subsidy, saying that NEC must decide whether to allow NNPC to continue with the payment or not.

    “Our problem is the volume, the quantity of consumption which is not acceptable.

    “Working with the governors so many decisions were taken but by next month, we are going to adopt that position either for the governors to take responsibility for the subsidy in their states based on the consumption or we look at other ways.

    “For instance, if you say we paid N800 billion subsidy, you will ask who are we paying the subsidy to? And if you look at infrastructure development and capital programme of the Federal Government, it is about N1.1 trillion, almost 70 per cent of what you are spending on developing the economy.

    “If there is no infrastructure development then you cannot talk about development of the economy. N800 billion is a huge amount that we must look at it, who is benefiting from it.

    “So we are coming up with a strategy, we are going to meet in the month of May and June. By next meeting, we will definitely come up with a position of the government at both level of volume of what is being brought into the country and what the state and Federal Government collaborate to check,’’ he said.

    The governor revealed that the Minister of State for Industry, Trade and Investment briefed the NEC on the establishment of the Nigerian Industrial Policy and Competitiveness Advisory Council which was approved by Federal Executive Council (FEC) in 2017.

    “The Industrial Council recognises that there is need for collaboration between the Federal Government (FG), State and Local Government to drive the industrialisation agenda.

    “The briefing today was to present the eight initiatives and recommendations from the Industrial Council that requires State Governments intervention,’’ he added.

    Yari said the Advisory Council requested NEC to approve the proposals to address the bottlenecks identified in order to drive the Industrialisation agenda.

    He, however, said that the Council while welcoming the prayers resolved that the Nigeria Communication Commission should go and outline its plans and communicate same to the State Governors in the next meeting.

  • State governors draw battle line with NNPC over oil revenue

    The National Economic Council (NEC) has confirmed that the N526 billion and 21 billion dollars was under-paid to the federation account by some Federal Government revenue generating agencies between 2010 and 2015 including the NNPC.

    Gov. Ibrahim Dankwambo of Gombe state made the disclosure while briefing State House correspondents after the meeting of the Council, which was presided over by Vice-President Yemi Osinbajo at the Council Chamber of the presidential villa, Abuja.

    He said the affected agencies which included Nigerian National Petroleum Corporation (NNPC) and 15 others were exposed following the presentation of the report of the technical audit of the agencies to the NEC by KPMG.

    Dankwambo said that NEC’s Ad hoc Committee which he chaired with members including governors of Edo, Kaduna, Akwa Ibom, Lagos and the Finance Minister had recommended refund of the amounts under-paid.

    According to the governor, NEC has agreed to extend the audit to June 2017.

    “One of the resolutions of NEC today is to extend the audit to June 2017. So, the audit will continue for the remaining agencies.

    “It is NNPC, NPDC, DPR, Customs, Federal Internal Revenue Services, NPA, Maritime Authority, all the revenue generating agencies and the details of the infringement are contained in the report.

    “Because it is voluminous report there are a lot of items that are there.

    “The most important decision that was taken is that a sub-committee will be set up which will be an arm of the legal committee of NEC that will look into details of these kinds of infringements and make sure that those issues that are criminal and require prosecution will be handled by office of the Attorney General of the Federation,’’ he added.

    He disclosed that the council had resolved to pursue strengthening of the NNPC governance structure to prevent further recurrence of such gross under-remittance by the NNPC and other revenue generating agencies.

    In his contribution, Gov. Rauf Aregbesola of Osun said the council commended the courage of the President and Vice President as Chair of Council in ensuring the probe of Federal Government Agencies and completing the audit report.

    According to him, this has gone a long way to promote transparency and the anti-corruption efforts of the Buhari administration.

    The Minister of Budget and National Planning Sen. Udoma Udo Udoma, updated the Council on the just concluded Economic Recovery and Growth Plan (ERGP) Focus.

    He said the ERGP Focus Labs were conducted successfully and the outcomes presented to the public last Tuesday, May 15.

    He told council members that the labs identified 164 projects spread across the six geopolitical zones of the country, saying that the outcomes indicated that over 500,000 jobs were likely to be created by 2020.

    He announced that more labs would be conducted in due course for other sectors and recommended that states should adopt the same model and commended all stakeholders for making the labs a success.

    “The labs process was found to be extremely rewarding exercise and stakeholders who attended benefited,’’ he said.

    A statement released by the secretariat of the council indicated that the Minister of Finance, Mrs Kemi Adeosun, reported to council that the balance in the Excess Crude Account (ECA) as at May 14, stood at N1,830, 682, 945.

    She also reported that the current balance in the Stabilisation Account as at May 14, stood at N15, 725,456,963, while the current balance in the Natural Resources Development Fund as at May 14, 2018 was N116, 104,644,763.

  • NNPC seeks dual licensing for petroleum operation

    The Nigerian National Petroleum Corporation (NNPC) yesterday recommended that petroleum licences be split into two components, saying one should be for prospecting, while the other should address production under the draft Petroleum Industry Administrative Bill (PIAB), now before the National Assembly.

    In a presentation at the Public Hearing organised by the House of Representatives Committee on PIAB, Petroleum Industry Fiscal Bill (PIFB) and the Petroleum Industry Host Community Bill (PIHCB), the Group Managing Director of NNPC, Dr. Maikanti Baru, said the proposed split would prevent a situation where operators would sit perpetually on oil acreages.

    The state run oil firm’s recommendation under the PIAB seeks a break up of Petroleum Licence into Petroleum Exploration Licence (PEL) – to prospect for petroleum, while the second component to be known as Petroleum Lease (PL), should be created to cover the production phase to search for, win, work, carry way and dispose of petroleum.

    The corporation also pushed for a re-think of the duration of licences as proposed in the PIAB which stipulates initial duration of 25 years for onshore and shallow water petroleum licence and 30 years for deep water and frontier acreages.

    NNPC, however, proposed five years prospecting licence for onshore and shallow fields and a duration of 10 years for deep offshore and frontier basins.

    It recommended 20 years production lease for onshore and shallow fields as well as deep offshore and frontier basins. The corporation noted that only the production lease period should be renewed for a period not exceeding 20 years.

  • NNPC not transparent in remittances, fuel consumption, say governors

    Some governors last night expressed displeasure over the handling of the nation’s finances by the Nigerian National Petroleum Corporation (NNPC).

    They also directed the management of the corporation to stop payment of royalty to the Federation Account. Also, they  ordered that every payment should be made to the Department of Petroleum Resources (DPR) as stipulated by law.

    The governors met behind closed-doors with Vice President Yemi Osinbajo at the State House. The Vice President is  Chairman of the National Economic Council (NEC).  Filling stations within 10 kilometers radius of the borders should be closed down, the meeting directed.

    They  called for the installation of tracking devices to monitor the movement of tankers to reduce smuggling of petroleum products to neighbouring countries.

    Chairman of Nigeria’s Governors Forum (NGF), who is  Zamfara State Governor, Alhaji Abdulaziz Yari, noted with dismay, the reintroduction of petroleum subsidy.

    Yari said: “This is the second time we are meeting with the NNPC in respect of remittances into the Federation Account. Governors and the Federal Government are not satisfied with the way remittances are being made because there are so many questions on the 425,000 barrel domestic and 180,000 barrel component of Nigeria from the Joint Venture Partners.

    “We met last week, the NNPC and the NGF came to brief the chairman of the NEC. We raised three issues, one,the issue of royalties. Each and every barrel taken out of the country there is either 17 or 24 per cent of it as royalty and there is 17 or 20 per cent as tax.

    “So, our main concern is that the Department of Petroleum Resources (DPR), said the NNPC is not remitting anything, payment of royalty, what they do is that they transmit direct from the NNPC to the Federation Account which is not allowed by the law.

    “According to the law that established the DPR, Section 196 of the Act, said the royalty should be paid to DPR and then transmit to the Federation Account.

    “So, we discussed today and we have sorted out those ones. The NNPC will now transmit to Federation Account with clear distinction that this amount is for royalty and X amount is for taxes, and X amount is profits from the sales. So we achieved that.

    “At the same time, NNPC is making payment on behalf of Nigeria on Cash-Call contribution and also the NNPC is making payment of cash call arrears of Nigeria’s contribution.

    “But, our main concern is that in 2015, they said about $16.8 billion which is outstanding, was not paid by the last administration and they negotiated it down to $5.1 billion according to them.

    “What we said specifically is that they should bring to us how much they have paid from 2015 to date and what is outstanding. And we directed them to stop payment until the claims are proven and then we can give further directives. That too was achieved.

    “On the issue of cost recovery otherwise called subsidy, the issue of subsidy resurfaced after the efforts of Mr. President. Before now the oil was $40 per barrel and now it is about $78 a barrel, so they are depending largely on importation.

    ‘Therefore, the cost is higher than what they are selling at the filling station and they need more money. When there was no cost recovery, the NNPC clearly gave us the number of 33 and 35 million litres per day as the consumption of Nigeria.

    “But now that with the new regime of cost recovery, NNPC is claiming daily consumption of 60 and 65 million litres per day? We rejected this and said no.

    “So many of our international partners are saying that even if we are feeding Nigeria, Cameroon, Ghana and Niger, we cannot consume more than 35 million litres per day.

    “So we are wondering where the 60 million litres are coming from. So, we are trying to sort that one out, that one is not yet resolved.

    “But, we are now taking a very hard decision, that because NNPC said the reason why they were lifting 60 million litres per day is because our borders are porous, so we have taken the decision that any filling station that is 10 kilometres on the border side should be closed by DPR. And, then we will do recertification according to the needs.