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Tag: oil firms

  • Rivers council gives Fed Govt, oil firms 14 days to meet its demands

    A local government in Rivers State,  Ogba/Egbema/Ndoni Local Government Area (ONELGA), has given the Federal Government 14 days to meet its demands or face indefinite shutdown of oil production in the area.

    The  ONELGA host communities Stakeholders Forum called on the state,  International Oil Companies (IOCs)  in the area and others to liaise with the Federal Government to draw out a plan to develop the council and free the environment of all forms of pollution.

    Chairman of the forum Nelson Ekperi, who made the statement on behalf of the group, urged Agip to  site the planned $15 billion refinery in the council,  promsing it sufficient land for the facility.

    The people added that IOCs must relocate their headquarters to ONELGA, stressing that compliance would ensure peaceful co-existence and smooth operations in the area.

    “We request that federal and state governments should produce a blueprint to develop ONELGA.

    “…the  Ministry of Niger Delta and NDDC should collaborate with the Federal Government in actualising our development.

    “We seek the dualisation of Ahoada-Omoku-Ebocha-Egbema road with street lights. The project should be awarded to Julius Berger, as it is the only construction company we would accept.” the statement said.

    Continuing, it said:  “NAOC should site the proposed refinary in ONELGA. We forbid the mentioning of any other place for the refinery.

    “Never again will the resources from the place be used to develop other areas while our land remain in abject poverty and grossly underdeveloped. We have set aside large expanse of land for the refinery project.”

    They urged Nigeria Liquefied Natural Gas (NLNG), Greenville Oil and Gas Limited and Indorama, and others to sign MOUs to fashion a method, strategy to develop the council as a mega city in 14 days.

    “We demand the relocation of the head offices of all IOCs  in ONELGA, in line with the Oil and Gas Industry Content Development Bill,  2010 (Nigeria Local Content).

    “Federal Ministry of Environment and Agip should address the environmental degradation and pollution in the area caused by the 2012 flood, which suspended dangerous chemical into the environment,  especially the last gas explosion at Ebocha oil centre.

    They expressed disappointment that  calls,  letters and appeals to the Presidency,  governments, national as well as state legislatures, multinational companies, NDDC and NLNG, for dialogue, were unanswered.

  • ‘Nigerian oil firms can execute 80% of engineering design’

    ‘Nigerian oil firms can execute 80% of engineering design’

    • NCDMB shifts focus to R&D for advancement

    Nigerian oil and gas service firms have the capacity to execute over 80 per cent engineering designs in-country, Executive Secretary, Nigerian Content Development and Monitoring Board (NCDMB), Simbi Wabote, has said.

    He said this while delivering the keynote address at the just-concluded maiden edition of the Nigeria Oil and Gas Industry Research and Development Fair and Conference. It was organised by NCDMB in Lagos.

    According to Wabote, the forum formed part of the Board’s initiative to re-energise the research and development aspect of the local content practice. He listed five key parameters for sustainable local content practice.

    He said:“There are five key parameters for sustainable local content practice.  First is an enabling regulatory framework backed with the appropriate legislation is key rather than use of directives or policies that are subject to speculations or compliance on ‘best endeavour’ basis.  In Nigeria, we have the NOGICD Act 2010 in place. It is no longer optional or debatable whether to comply. The Act established NCDMB as the sole agency for local content implementation in the oil and gas industry and has set minimum targets in 278 services across oil and gas value chain to enhance local capacity development

    “The second parameter is capacity building. Structured capacity building intervention is essential to spur domiciliation of capabilities in-country. This is not limited only to local manufacturing and infrastructural development, but also includes need for human capacity development. Our capacity building interventions in NCDMB have increased the in-country value retention from less than five per cent before the NOGICD Act to the current 26 per cent.

    “Since the Act came into effect, we have developed two world class pipe-mills and five pipeline coating plants, grown fabrication capability to over 60,000 metric tonnes per year, and we now have the capacity to carry out over 80 per cent of engineering design in-country. We have created over 30,000 direct jobs, delivered over six million training man-hours, witnessed the award of over 90 per cent of contacts to Nigerians, witnessed the growth of successful indigenous operators, put in place facility for floating production, storage and offloading (FPSO) integration, among others.

    “The third parameter is gap analysis. Periodic gap analysis is essential to determine gaps that needed to be closed in the areas of skills, facilities and infrastructure. The oil and gas industry is a very dynamic one. Regular reviews of local content targets reveal where capacities have been met and where there is over-capacity to guide deployment of resources and investment decisions. Periodic internal gap analysis is also important as we have done with our internal process reviews and development of a 10-year strategic blueprint to position the Board in effective delivery of its mandate

    “The fourth parameter is the provision of funding and incentives.  Fiscal and monetary incentives are essential to attract new investments and keep existing businesses afloat where required. In partnership with Bank of Industry, we recently launched a $200 million intervention fund for our Nigerian oil and gas service providers that are contributors to the Nigerian Content Development Fund. The intervention fund has all-in single digit interest rate of eight per cent for loans extended to Nigerian oil and gas Service providers and all-in single digit interest rate of five per cent for loans extended to community contractors.

    “The last but not the least of the parameters for sustainable local content practice is Research and Development. Local content thrives where there is robust research and development (R&D) guideline to drive development of home-grown technology.”

    Wabote described R&D as the bedrock of innovation. “It is essentially an investment in technology and future capabilities, which is transformed into new products, processes and services.  History teaches us that such investment, and such commitment to discovery, lead to prosperity.”

    According to him, some countries have done very well in these two aspects of R&D.  Countries such as South Africa, China, India, United States, South Korea and Singapore, he said, are examples of countries that have developed a world-class R&D capacity. Governments in these countries directly support scientific and technical research.

    “For example, in recent years, spending on R&D has increased sharply in Brazil. R&D expenditure of Brazil increased from one per cent in 2004 to 1.2 per cent in 2013. In 2016, Brazil spent 1.4 per cent of its GDP on R&D that is about $25 billion in a year,”he said..

  • Senate tackles banks over oil firms’ $63b capital flight

    Senate tackles banks over oil firms’ $63b capital flight

    ‘Cash taken out under suspicious circumstances between 2009 and 2014’

    The Senate is investigating some banks for alleged collusion with some international oil companies (IOCs) to defraud the country.

    Over $62,909,716,417 is said to have been taken out of the country under suspicious circumstances between August 2009 and December 2014.

    The “Investigation of the pre-shipment inspection of export activities in Nigeria” is being conducted by the Senate joint committee on Finance, Trade and Investment, Gas, Petroleum Upstream, Banking, Insurance and other Financial Institutions, Judiciary, Human Rights and Legal Matters, and Customs and Excise.

    A document obtained by The Nation showed the banks were asked to submit copies of certified Nigeria Export Proceed (NXP) issued/or processed by them in respect of all crude oil and gas exported by Nigeria Agip Company Ltd, Chevron Nigeria Limited, Shell Petroleum Dev. Co. Nig. Ltd and their affiliates between April 1996 and December 2016.

    The banks are to submit all domiciliary accounts opened and /or closed within the period specified for crude oil and gas exported.

    Two banks – Citibank and Standard Chartered Bank – appeared at the investigative joint committee on Thursday. Other banks said to be associated with the export of oil and gas will also appear.

    A member of the committee, Senator Yusuf Yusuf (Taraba State), queried why funds brought into the country as oil export proceeds were wholly withdrawn a day after such proceeds were brought.

    He said the probe became necessary because the banks should have ensured petroleum products exporters did the right thing by obeying the guidelines and laws of the country.

    “It is worrisome that money comes in today, tomorrow the same amount goes out of the country. The practice runs through the statement of account submitted by the banks. The oil companies bring in $20 billion today and tomorrow $20 billion is taken out from the account – Yusuf said…

    “The banks are colluding with multinational oil companies to defraud the country. The government relies on the banks; the banks are now colluding with the multi-national oil companies.”

    He noted that it was obvious the country was not getting the correct export proceeds from oil and gas exports.

    The lawmaker, who insisted that banks had the responsibility to abide by the law, said it was worrisome no indications were made about who paid for oil exports.

    He noted that the committee was interested in why same company exports and pays for products without an indication of who actually buys the products and the corresponding bank.

    The Chairman of the joint committee, Senator John Enoh, said the committee was interested in ensuring that banks are not colluding with IOCs to flout the laws of the country.

    Enoh said the committee would take a critical look at the submissions made by the banks to come to terms with the true position of oil and gas exports proceeds processes.

    A document submitted to the committee, which was obtained by The Nation, showed that Citibank Nigeria operates domiciliary export proceed accounts for ENI Group (three accounts), Chevron Group (six accounts) and Shell Group (two accounts).

    The document also showed that Nigerian Agip Oil Company recorded a total export inflow valued at $15,372, 882,703.36

    Chevron Group recorded $44,020,596,289.99. Shell group made a total inflow valued at $3,516,237,425.79 giving total of $62,909,716,417 billion.

    The committee resolved to screen documents submitted by the banks before coming up with its recommendations.

    The committee expressed its determination to get to the root of pre-shipment inspection of export activities.

  • NCDMB in talks with oil firms on contract processing

    NCDMB in talks with oil firms on contract processing

    Nigerian Content Development and Monitoring Board,(NCDMB) and other stakehholders in the value chain are discussing how to improve ways contracts are processed.

    The Board said it was meeting agencies involved in contracts processing, among others, to achieve the goal.

    NCDMB’s Executive Secretary Simbi Wabote said the agencies needed to improve their internal mechanisms, before they could improve methods of processing contracts in the oil and gas sector.

    He said the initiative would help in meeting deadline for processing contracts by the  petroleum industry.

    Wabote, who spoke at a stakeholders’ forum in Lagos recently, said the Board would help in providing capacity for infrastructure, manufacturing, procurement and others, that are vital to the growth of the oil and gas sector  and the economy.

    He  said NCDMB  was working to know and close the skills gap, by partnering with investors.

    He said the Board has been positioned to review contracts within 100days, provided the documents submitted are in line with the Nigerian Oil and Gas Industry Content Development (NOGICG) Act.

    Through the intervention, he said the Board had over 1,500 trainees attached to oil and gas projects, trained 100 and 500 people in geosciences and environmental remediation, captured over 7,000 candidates in its JQS platform.

    He said under the new strategy, beneficiaries would be provided with skills and certifications needed for employment in Nigerian and beyond.

    According to him, the board has what it describes as 60-20-20 principle in place, adding that through the principle, 60 per cent of its training resources are devoted to young Nigerians to assist them in securing employment; 20 per cent chanelled towards improving productivity, while another 20 per cent  is devoted for  trainings on softwares.

    On capacity building, he said NCDMB has met the international oil companies (IOC’s)standard and the service providers on the issue.

     

  • Agency intervenes in oil firms, community dispute

    The Bayelsa State Partnership Agency (BSPA) has intervened in the lingering crisis between oil companies and their host communities.

    Director-General Stanley Braboke, who spoke yesterday in Yenagoa, said the agency was able to reduce constant violent agitation by aggrieved communities against oil firms.

    According to him, many unresolved cases were revisited and resolved to avert a breakdown of law and order.

    His words: “Prior to the establishment of this agency, there were frequent disputes between oil companies and their host communities. But this vision has drastically reduced the frictions and brought harmony between the companies and their communities.

    “In line with our mandate, we have attended to and resolved many hitherto unresolved cases to avert a breakdown of law and order between host communities, the government and oil multi-nationals.

    “It was an old practice for oil companies to sneak into Bayelsa communities to avoid proper documentation and so evade tax, but since we came on, we have held many meetings with oil multinationals and other stakeholders in the industry.

    “We have also reached an agreement that any firm coming into the state must first notify the agency for proper documentation to avoid violent clashes with host communities.”

    Braboke added that the agency warned companies to implement agreements reached with their hosts – carry out Environmental Impact Assessment (EIA); clean spill sites and live up to their social responsibility to avoid problems.

    He lamented that tax evasion by oil companies over the years had robbed government of revenue running into billions of naira.

    “It is regrettable that while some oil multi-nationals are enjoying uninterrupted power, portable drinking water, and road to their staff estates; areas occupied by their host communities have remained in darkness.

    “Even their host communities drink from the same water they defecate into, with no access road to  their farms.

    “We are urging these companies to turn a new leaf and quit subjecting their host to slavery in their communities. Without peace in the community, their operation would suffer setback.

    “Harmony can only be attained when youths in the communities are given a sense of belonging, particularly by engaging them and creating jobs to redress their grievances and redirect their energies into productive ventures,” Braboke said.

  • Five oil firms implicated in Diezani’s $153m scandal

    Five oil firms implicated in Diezani’s $153m scandal

    Five oil companies have been linked with the $153million seized from former Minister of Petroleum Resources Mrs. Diezani Alison-Madueke, The Nation learnt yesterday.
    The chief executives of the oil firms are believed to have gone underground to evade arrest, prompting investigators to believe that they may have opted to forfeit the cash.
    But the source of the cash sparked a row last night following claims by a suspect that the $153million was sourced by the former minister from the five oil firms and not the accounts of the Nigerian National Petroleum Corporation (NNPC).
    The suspect said the $153million was another tranche of funds mobilised under the table by Mrs Alison-Madueke from oil companies for the re-election of ex-President Goodluck Jonathan.
    The board of NNPC is likely to meet in Abuja to get “a full briefing” on the cash scandal.
    Justice Muslim Hassan of the Lagos Division of the Federal High Court on January 6 ordered the seizure of the cash which, according to the Economic and Financial Crimes Commission(EFCC), was stolen from the NNPC’s accounts and stashed in some banks.
    The oil companies whose identities remain unknown “so as not to jeopardise the investigation were allegedly involved in how the funds were wired in exchange for some concessions.
    “It is however indisputable that the oil companies collaborated with Diezani and acted on her instructions to haul the cash to one of the banks which distributed it to others,” a source close to the investigation said.
    “ EFCC detectives have succeeded in cracking how the funds were channeled and distributed. “Detectives are on the trail of the chief executives of the five companies. One of them was allegedly traced to London and we are expecting his arrest anytime from now. The EFCC and UK authorities have closed in on one of the oil chiefs in London,” the source said, pleading not to be named because he is not permitted to talk to the media.
    On the source of the $153million, one of the suspects said came from the oil firms’ chiefs and not the NNPC accounts.
    Another source said: “The suspect said only the oil chiefs could explain where they got the $153million.
    “The suspect insisted that the cash was not from NNPC’s accounts. The suspect said this was why the ex-minister had the audacity to raise some posers for EFCC on the     cash.
    “But irrespective of the source, the EFCC had uncovered the slush funds and none of the oil firms’ chiefs has come out to claim it. They are even distancing themselves from the money. They prefer to forfeit the money than being brought to justice.”
    Mrs Alison- Madueke last Saturday faulted EFCC’s findings that the $153million was stolen from NNPC’s account( s).
    In a statement from London, she said: “In the face of the obvious falsification of facts and misinformation, it is only right and proper that the EFCC should publish the details of the $153.3million lodgments, the bank account numbers and the account beneficiaries, showing proof of my link to them.
    “Having also alleged that the said $153.3million was ‘wired’ from NNPC, the EFCC should also publish details of the NNPC accounts from where the said $153.3 million was taken from, with proof that I authorised such a transaction/transactions acting either in my private capacity or, as The Honourable Minister of Petroleum.
    “Let me state for the record that as Minister of Petroleum, the operation and management of NNPC finances were outside my purview as outlined in both the Petroleum Act and the NNPC Act.
    “The only involvement I had in NNPC finances was in terms of statutory matters, where the Petroleum Act prescribed that as minister, there were certain duties or actions which I had to perform or take in relation to NNPC.”

  • New militant group gives oil firms 48-hour quit notice

    New militant group gives oil firms 48-hour quit notice

    •’Fight is for interest of upland Niger Delta and all Ijaw’

    The Niger Delta crisis worsened yesterday, as a new militant group,  Niger Delta Greenland Justice Mandate (NDGJM), threatened to attack oil and gas facilities in the upland of the oil-rich region.

    The new group, which decried what it called Federal Government’s and multinational oil companies’ neglect of the region, gave oil companies 48-hours to evacuate their personnel from the region, especially in the upland.

    In an online statement by its spokesman, Aldo Agbalaja, NDGJM threatened to attack Warri Refinery and Petrochemical Company (WRPC) at Ekpan in Uvwie Local Government of Delta State as well as the Port Harcourt Refining Company (PHRC) at Eleme in Eleme Local Government of Rivers State.

    The statement said its decision to change from peaceful approach to violence followed what it called Federal Government’s failure to appreciate and consolidate the peaceful disposition of the people in the upland part of the region.

    NDGJM said: “We are asking all oil multinationals still in the upland of our region – Agip, Total, Shell, Mobil, Shorelines, Neconde, E. D. Western, Seplat and others – to commence the evacuation of their personnel from the region, especially in the Ogba/Egi axis of Rivers State, Urhobo/Isoko/Ndokwa axis of Delta State and other upland oil producing areas, within 48 hours.

    “We also want to bring it to the attention of the Federal Government and the Nigeria National Petroleum Corporation (NNPC) that the refineries in Warri (Urhobo land) and Port Harcourt (Eleme) and the gas plant at Otorogun will come down in a few days.

    “We have come at this point to ensure that our oppressors, being the Federal Government, the state governments in the six core Niger Delta states, who have received billions of dollars in the past years but have brought little or no development to the region, and the so-called super-ethnic nations, who have yielded to greed and wickedness and have exposed the rest of us in the oil-rich but deeply impoverished region, to crippling squalor.

    “NDGJM is a coalition of forces across the Niger Delta, fighting for the interest of the region. The Federal Government and the oil multinational companies have been making a grave mistake by equating the interest of the Ijaw as that of all the tribes of the region. Indeed, this is a mistake that is about to take a more devastating toll than has ever been seen or experienced in the history of Nigeria.

    “Any moment from now, we shall be making a loud statement, which we believe should be loud enough for all to hear and take seriously; afterwards, we will state our demands. We have considered this ‘coming statement’ reluctantly inevitable because of the recalcitrance of federal authorities as well as oil giants. They have decided to ignore calls to reason and have made violence the only option.

    “The people of the upland Niger Delta, under whose watch the largest and most critical oil assets are located, have been ignored over the years. The government and the oil companies pander to every whim and cough of those who have violently engaged the state. Just as in the 2009 experience, the Federal Government and oil companies have started yet another round of negotiation with the Ijaw front, in the name of all the people of the Niger Delta.

    “This will not work. Since they do not regard the assets in our areas important enough to be protected, we shall root them all out of …Niger Delta. We don’t want to make this mistake any longer: violence pays, as it has become the only voice the government hearkens to.”

     

  • Reps seek support for indigenous oil firms

    The House of Representatives’Committee on Local Content has called on the international oil companies (IOCs) to support indigenous oil service firms.

    The committee made the call during inspection of the shipyard and fabrication complex operated by West African Ventures (WAV) at Onne in Rivers State.

    Its Chairman,  Emmanuel Ekon, said patronage of WAV and other indigenous firms would help reduce capital flight and promote local content.

    Experts say about $8 billion is lost yearly to capital flight as a result of  jobs done by foreign firms. Based on this, the committee said it would push for a law to cancel contracts awarded by IOCs to foreign firms, which their indigenous counterparts can execute in-country.

    Ekon said the poor patronage of WAV shipyard, fabrication complex and marine facilities, as well as those of the other indigenous companies, has worsened capital flight in the oil and gas industry.

    He said the committee decided to  visit to assess its facilities  to avoid supporting indigenous contractors who are mere agents of foreign firms.

    “We believe that companies, such as WAV with huge investment in the country, and employer of over 5,000 Nigerians, should be encouraged so that the investors can do more. That way, we will reduce capital flight. WAV ought to be patronised first by the IOCs when they need marine services,” he noted.

    Ekon said indigenous firms if supported could boost revenue and enhance economic growth.

    He said: “What we have seen here is 100 per cent Nigerian company and by the Content law, WAV is supposed to be patronised first by the IOCs, where they need marine services. That’s what the law says and the law is not ambiguous but explicit, especially where there is Nigerian competence and in-country capacity. The law states that the IOCs or whoever is giving out contract, should give a Nigerian company the right of refusal.

    “The best the IOCs can do for Nigeria is to patronise indigenous companies such as WAV so they can in turn engage Nigerians teeming unemployed youths.”

    The committee chairman also admitted that issues relating to inadequate patronage were fallout of the global crisis in the oil and gas industry, but urged the IOCs to promote local content.

    “I think the primary thing is to make sure that the government wades in to restore peace particularly in the Niger Delta area where the oil and gas business is carried out. For now, we still have one major source of revenue in this country, which is the oil and gas business.

    ‘’Hence, the House of Representatives will oppose and cancel contracts awarded to foreign companies where there is in-country capacity, and where huge investments have been made local firms.

    “Basically, I think if there is peace and militant activities brought down to the barest minimum, opportunities will come in for WAV and other local firms. WAV has demonstrated capacity and needs to be patronised.

    A member of the Committee, Kehinde Agboola, said: “Drop in patronage is a global crisis; it’s not restricted to the oil and gas sector or WAV. The IOCs in Nigeria should patronise WAV because it is a good example of indigenous company with capacity. That is the whole essence of local content.”

    The committee members admitted that the Niger Delta issues contribute to the challenges of the indigenous companies, and stressed the need for the government ensures there is peace in the region as the oil and gas business remains the mainstay of the economy.

  • Oil firms lament zero output

    The renewed attacks on oil installations in the Niger Delta region by militant groups, have rendered most oil producers, especially the indigenous operators, zero production and zero revenue.

    The Managing Director/Chief Executive Officer, Seplat Petroleum Development Company Plc, Mr. Austin Avuru who spoke yesterday in Lagos at the annual conference of the Society of Petroleum Engineers (SPE) Nigeria Council, said operators are no longer bothered by drop in crude oil prices because there is nothing to produce and export for sale.

    He said: “These are pretty difficult times for our industry, and for our country. Today, over 70 per cent of production from the traditional terrain in the onshore and the shallow water is locked in. A year ago, we were faced with drop in oil prices, but today we are battling with zero production, zero revenue for up to five-six months now.

    “Some of us no longer check the oil price, because it is only relevant when you produce; this industry was undergoing a major transformation. Few years ago, we said this industry must move away from just being a primary revenue generation for the government to becoming an enabler for economic development.

  • Govt loses $2bn to tax evasion by oil firms

    The Federal Government has lost about $2bn to oil companies  avoiding payment of compulsory fees, the House of Representatives ad hoc committee mandated to investigate all oil prospecting licenses (OPLs) and Oil Mining Leases (OMLs) granted by the Federal Government said yesterday.

    Chairman of the Ad Hoc committee,  Gideon Gwani, said the oil companies are owing the government hundreds of millions of dollars thus compounding the problem, when they should have been the ones helping to salvage the situation of the country by prompt payment of their taxes.

    He said the situation is alarming and worrisome, adding that “this is a dangerous trend that cannot be allowed to continue.”