The Nation Newspaper

Tag: oil sector

  • The face-off in oil sector

    SIR: The Africa Network for Environment and Economic Justice, ANEEJ, calls on the National Assembly to, as a matter of urgency, pass the Petroleum Industry Governance Bill, so as to nip in the bud further confusion generated by the rift between the Minister of State for Petroleum, Dr. Ibe Kachikwu, and Group Managing Director of the NNPC, Dr. Maikanti Baru, over allegations of inappropriateness in the allocation and award of contracts in the oil sector.

    We applaud the Senate for moving quickly to unravel allegations of inappropriateness levelled by the Minister of State. The response of the President concerning the allegations of disregard for due process in the award of contracts by the NNPC GM, would define the perception of the reforms which have been going on in the oil sector.

    Since the Senate has waded into the matter, we suggest that the President as well must invite the Nigerian Extractive Industry Transparency Initiative, NEITI, to carry out a comprehensive and forensic audit of the allegations. Among statutory functions of the NEITI include the regulation of matters related to due process in the award of contracts in the extractive sector of the Nigerian sector. We believe that the inconsistencies being thrown up by the startling revelations from the Minister of State for Petroleum Resources include some of the issues which the Petroleum Industry Governance Bill seeks to address and redress.

    The present administration since inception has defined itself first through its corruption stance, and more by the reforms it has introduced in the oil sector. It scrapped the opaque oil swap which made it possible for individuals within government to line their pockets with millions of dollars and has replaced it with the Direct Sale, Direct Purchase scheme.

    That lofty plan of Direct Sale, Direct Purchase stands in jeopardy if all the contracts that have been awarded and the companies they have been awarded are not subject to thorough vetting and investigations by both the Senate and the NEITI.

     

    • Rev David Ugolor,

    ANEEJ, Benin City.

  • NEITI begins 2015-2016 oil sector audit

    NEITI begins 2015-2016 oil sector audit

    The Nigeria Extractive Industries Transparency Initiative (NEITI) has commenced a comprehensive audit of the oil and gas sector for  2015 and 2016.

    Its Executive Secretary, Mr. Waziri Adio announced this in Lagos at a workshop for major oil companies and relevant government agencies expected to participate in the exercise.

    According to a statement endorsed by its Director of Communication, Dr Orji Ogbonnaya, the independent audit of the oil and gas sector will examine the fiscal, physical and process issues from, within and among the companies and relevant government agencies.

    Adio stressed that NEITI is committed to working closely with the companies under the EITI framework to create good business environment that is conducive for the inflow of more foreign direct investments into the extractive sector. He added that, for this to happen, there is need to encourage all companies to embrace transparency, accountability and corporate governance in conformity with the EITI standards.

    According to the report, major international oil and gas companies operating in the country were represented at the workshop.

  • Stop mass sack in oil sector, NUPENG tells Fed Govt

    Stop mass sack in oil sector, NUPENG tells Fed Govt

    The National Union of Petroleum and Natural Gas Workers (NUPENG) has expressed concern over the increasing job losses in the oil and gas sector and  the closure of international oil companies.

    Addressing reporters after its Central Working Committee (CWC) meeting in Lagos,  its National President, Comrade Igwe Achese, noted that Labour and Employment Minister, Dr. Chris Ngige’s, assurances that there was nothing reassuring in job cut would stop.

    The union urged the Federal Government to prevail on international oil companies (IOCs) country to stop the retrenchment.

    Achese said the delay in the passage of the Petroleum Industry Bill (PIB) was majorly responsible for the rot in the industry and the slide in the returns accruable from investments by successive governments and investors.

    He called on the National Assembly to expedite parliamentary actions for speedy passage of the bill for the purposes of engendering transparency, accountability and commensurate returns in the operations of the oil and gas sector.

    He said the union believed that passing the bill will further enhance the visibility and attractiveness of the sector to both foreign and local investors.

    On the privatisation of the refineries, Achese said: “The CWC-in-Session notes the current calls and agitation by some interested capitalists for the privatisation of the nation’s four refineries.

    “We kick against such moves and advise the Federal Government to sincerely do the Turn-Around-Maintenance (TAM) of the refineries and upgrade their systems in order to allow them produce at full capacity. The CWC believes that this will go a long way to reduce the massive importation of petroleum products into the country.”

    Achese also explained that the CWC-in-Session called on the Federal Government to grant tax holidays and free land for investors, who want to establish private refineries.

    He commended the Federal Government’s position to encourage operators of illegal refineries to be integrated into the establishment of modular refineries.

    He advised that the pronouncement should not be political, but matched with actions to train the refiners and put appropriate policies and regulations in place to regulate their operations in order to protect the eco system from possible negative effects of their activities.

    “We further urge the Federal Government to support the refiners with funds necessary for effective and efficient modular refineries, which we believe will go a long way in supporting the supply of petroleum products for local consumption and also generate employment opportunities for the restless youths,” he said.

    Achese lamented that the economy was still generator-driven, adding that power sector privatisation has failed.

    The Federal Government, he said, should put pressure on the electricity generation and distribution companies (GENCOs and DISCOs) to be alive to their responsibilities or have their licenses revoked.

    The union lauded the Federal Government’s efforts at addressing inflation.

    “The CWC x-rayed the state of the economy and commended the government in its efforts to shore up the naira against the dollar and the drop of the inflationary rate to 17.5 per cent.

    “The session, however, stated that a lot still needs to be done to address the current recession and reduce the hunger in the land. The CWC-in-Session wants the Federal Government to address the challenges of poverty, unemployment and hunger in the land.”

    NUPENG added that the  government should vigorously address the issue of rising cost of goods and services.

    “The CWC-in-Session called on the Federal Government to look inward and put structures and strategies to restructure the economy.

    “The Session wants the National Assembly to quickly put finishing touches to the budget so that it can be passed and assented by the President, so that the liquidity squeeze can be addressed and debts owed contractors paid after verification,” Achese said.

  • Ibe Kachukwu: Working round the clock to ensure stability in the oil sector

    The survival of Nigeria as a sovereign nation – state is largely dependent on the petroleum sub – sector as she derives her revenue majorly from crude oil exports.

    Indeed, Nigeria is a mono – culture economy whose economic lifeline is basically predicated on the exploration and exportation of its black gold, popularly referred to as crude oil. As it stands, the most critical national infrastructure of Nigeria are pipelines that have been designed to ensure and guarantee uninterrupted supply of crude oil to various refineries across the country.

    Overtime, particularly during the Obasanjo, Yar’Adua and Jonathan administrations, there has been a consistent threat to oil and gas installations in the country arising from the activities of Niger Delta Militants who have been advocating for resource control and other criminal elements who engage in malicious vandalism of the nation’s oil assets in furtherance of their illegal bunkering business.

    However, the advent of the present administration under the dynamic leadership of President Muhammadu Buhari has ushered in a new dawn in the petroleum sub-sector of the Nigerian economy.

    The appointment and subsequent assumption of office by Dr. Ibe Kachukwu as Nigeria’s Minister of State (Petroleum) has turned-out to be the magic wand needed for the stability and effective sustenance of crude oil production in the country.

    If the truth must be told, President Muhammadu Buhari deserves commendation for the meritorious appointment of Dr. Ibe Kachukwu. Mr. President, in his determination to ensure that round pegs are put in round holes, was not in anyway swayed by sentiments or emotions in assigning the petroleum portfolio to Kachukwu.

    So far, the comprehensive reforms undertaken by Dr. Ibe Kachukwu in repositioning the petroleum sector has been very far reaching and producing the desired results to the extent that there is steady and continuous production of crude oil in our refineries and supplies to the various outlets has been very smooth.

    Under the watch of Dr. Ibe Kachukwu, the oil and gas sector, particularly the NNPC is beginning to live up to its mandate of producing fuel for local consumption and export to the international market – for the economic survival of the Nigerian Nation.

    To every discerning mind and keen watchers of the of the petroleum sector, the speed at which Kachukwu is going about delivering on his responsibility does not live any one in doubt that he is well focused and has a clear vision of changing the ugly narratives associated with the production and supply of petroleum products to a new order of efficiency and sustainability of the gains achieved thus far.

    At the global scene, the influence and connections of Kachukwu has brought the much desired respect and regard to Nigeria among the comity of nations. Right now, he is a strong personality to be reckoned with in the Organization of Petroleum Exporting Nations (OPEC).

    A cursory analysis of the performance of ministers in the federal executive council point in one direction: that is, Dr. Ibe Kachukwu is unarguably, ranked as one of the best performing ministers under the Buhari-led administration.

    As for the NNPC (Nigeria National Petroleum Corporation), the solid foundation laid by Kachukwu when he held forte as the Group Managing Director (GMD) has taken the organization to the next level of utmost efficiency, accountability and profitability.

    It is to the credit of Kachukwu that after 6 years of the comatose state of the nation’s crude oil pipelines, it took his bold intervention for the Federal Government to engage the professional expertise of an indigenous oil and gas outfit to successfully remediate, repair and maintain and provide security services on the Bonny to Port-Harcourt and Excravos to Warri pipeline segments.

    It would be recalled that before now, it cost the nation a huge chunk of its hard-earned resources to sustain the engagement of marine vessels to transport crude oil to the refineries; more so, when there was a sharp drop in the price of oil at the international market which adversely affected accruable revenue to the federation account.

    At the moment, there has been seamless and continuous pumping of crude oil through the aforementioned pipelines. The only interruption till date has been the criminal activities of some faceless militant groups, including the illegal bunkering activities being undertaken by oil thieves and other economic saboteurs.

    For many Nigerians, Dr. Ibe Kachukwu should be applauded for the unpopular but plausible decision he took for the partial removal of fuel subsidy sometimes in 2016. This was one painful reality that Nigerians never wanted to experience, but today, the Nigerian people are happier for it as they can now drive into any petrol station of their choice with ease and get products without stress or having to wait endlessly on queues to be served.

    It is heartwarming to note that at present, the build-up of tension and hostilities in the Niger Delta Region is beginning to give way for constructive dialogue. This cheering news can only be attributed to the untiring efforts of Dr. Kachukwu to ensure that there is sustainable peace and stability in the Niger Delta which is very vital to the production of crude oil – both for local consumption and export to the international market.

    The confidence and peace – building initiatives embarked upon by the federal government through the engagement of relevant stakeholders in the Niger Delta and the recent visits of Vice President Yemi Osinbajo to the creeks and other Niger Delta communities has gone a long way of providing a formidable platform for the federal government and concerned interests to sit down on the round table to discuss all the issues arising. Without doubt, this is a noble idea of the Buhari’s Administration facilitated by Dr. Ibe Kachukwu.

    Indeed, to the glory of God, Dr. Ibe Kachukwu is working, the petroleum sector is becoming more efficient, while Nigeria is moving towards economic progress and prosperity – for all and sundry.

    •This article was written by Justus Odoigbe of the Joint Professionals Training and

  • OPEC Sec-Gen to meet Osinbajo, Kachikwu on oil sector dynamics

    •Barkindo in Nigeria for conference

    Organisation of Petroleum Exporting Countries (OPEC) Secretary-General Mohammad Barkindo will this week discuss market dynamics in the oil sector with Acting President Yemi Osinbajo and Minister of State for Petroleum Resources Dr Ibe Kachikwu.

    Dr. Barkindo, who arrived in Nigeria yesterday, will also attend the 16th Nigeria Oil and Gas Conference (NOC) and Exhibition during his four-day working visit.

    The News agency of Nigeria (NAN) quoted the Nigerian National Petroleum Corporation (NNPC) spokesman, Mr Ndu Ughamadu, as saying that the fallout of Barkindo’s visit will be felt in the sector for a long time.

    Ughamadu was quoted as saying: “Yes, it is a big event that will affect our markets positively. He is leading an eight-man delegation and his advance team arrived earlier and will talk on the oil and gas market outlook.

    “I believe whatever policies put in place here will be strictly adhered to and give our economy the needed boost.  I’m excited. It’s a big event.”

    At an earlier news briefing, Ughamadu said Dr. Kachikwu would give a keynote address on Repositioning the Oil and Gas Sector’ and that the  NNPC’s Group Managing Director, Dr Maikanti Baru, would speak on “`Commercialising the NNPC”.

    The four-day conference will end Thusday.

    More than 6,000 delegates, 250 exhibitors, from over 20 countries, many oil and gas experts and hundreds of government representatives and other stakeholders from different countries would attend the conference.

  • NMA, NGOs back oil sector deregulation

    NMA, NGOs back oil sector deregulation

    The Nigerian Medical Association (NMA) and the Forum of Non-Governmental Organisation have expressed support for the deregulation of the downstream oil sector by President Muhammadu Buhari.

    The groups however called for the implementation of the palliative measures to cushion the effect of the policy on the masses. The Federal Government last  week announced a new petrol price regime of not above N145 per litre, and also opened up the sector for everyone that wants to import the fuel. Individuals are however to source their foreign exchange (forex) outside the Central Bank of Nigeria (CBN) window.

    NMA President, Prof. Mike Ozovehe Ogirima said the group supports the deregulation of the downstream oil sector, though with a caveat that part of the palliative should include the immediate release of at least five per cent of the consolidated revenue fund as basic health care provision.

    “The NMA supports the deregulation of the oil sector but with a caveat that part of the palliatives should include the immediate release of at least five per  cent of the consolidated revenue fund as the basic health care provision fund (BHPF) which the National Health Act has given to Nigerians and guarantees its availability. This would revamp Primary Health Care (PHC) and reinvigorate the National Health Insurance Scheme (NHIS) to cover all Nigerians.

    Also, the National Chairman,  Forum of Non-Governmental Organisation, Comrade Wole Badmus, said subsidy has been responsible for the neglect of the refineries over the years.

    He said the control the Federal Government has exercised of the downstream oil sector through subsidy has led to perennial fuel scarcity.

    Badmus who spoke to reporters in Abuja yesterday said the old ways of managing the oil sector has failed the country and it is time to move forward, given the present economic reality.

  • Maitama Sule blames fuel crisis on rot in oil sector

    Maitama Sule blames fuel crisis on rot in oil sector

    Elder statesman and former Permanent Representative to the United Nations Alhaji Yusuf Maitaima Sule has said President Muhammadu Buhari should not be blamed for the fuel scarcity.

    He said Nigeria would soon be better and urged Nigerians to cooperate and wait for better days.

    Speaking to reporters yesterday in Abuja, Sule noted that those blaming Buhari for the fuel scarcity and hardship were not fair to him or the Minister of State for Petroleum Resources, Dr Ibe Kachikwu.

    His words: “Let us be honest to ourselves. Is the administration responsible for the woes and ills we are suffering at the moment? They have inherited them. This administration has been there for one year. And one good thing is that they are doing something to address the problems they met on ground.”

    According to him, the problem in the oil sector could not be overcome overnight due to the technical nature of the sector.

    “It is like having a chronic wound and you want it to heal; to wash it is painful; scrap it, is equality painful; apply medicine is painful also. Unless you experience the pains, the wound will not heal… We are experiencing some pains no doubt but after these pains there will be ease, but with patience and prayers, there will be a light at the end of the tunnel,” he said.

  • Buhari, union leaders meet for oil sector harmony

    Buhari, union leaders meet for oil sector harmony

    President Muhammadu Buhari on Wednesday met behind closed-doors with the leaders of the NUPENG and PENGASSAN at the Presidential Villa, Abuja

    At the end of the meeting, the Minister of State for Petroleum Resources, Emmanuel Ibe Kachikwu, briefed State House, Abuja.

    According to him, the meeting was held to promote peace and harmony in the oil sector.

    He said: “The meeting with the President was basically to review in the oil industry some of the concerns areas that he himself is trying to find joint solutions and share thoughts.

    “Like you know his Excellency has too many constituencies first will be politics, second army and the third will be the oil industry. So matter of this nature touches his heart very much. And this is the first opportunity that the unions have had to spend a bit of time with him as a father.

    “So we shared thoughts, areas of concerns and some solution potentials and agreed to collaborate and work together,” he said.

    Asked to list the concerns shared with the President, the Minister said: “I will probably highlight a few areas of concerns. The PIB, the union wants us to obviously work harder than we do and try to get the PIB passed as soon as possible. They are worried about the fuel scarcity issue‎ and want a long time solutions to finally resolve this issue, they are worried about the refineries and are thankful we didn’t sell the refineries without looking to work collaboratively with them to see how to make the refineries work.

    “They are worried about the utilization of depots and how best to do that, they are worried about all kinds of logistics issues that plague the oil industry.

    “They are worried about job loss in the sector arising from the position of majors who feel that the economy is giving rough end of the sticks and then try to whittle down staff. And so we are going to be working with the oil majors to ensure that we do not experience the kind of job loss that we are hearing has the potential to occur in the sector,” he added.

    According to him, the President assured of his willingness to work together with them to bring good jobs.

    The President, he said, also tasked them to be agents of change within the areas they work‎ to ensure they take change on its head and make it happen.

    “A lot of these problems that are on the table were quite frankly there when we came and we are doing the best we can to try and work on it. But we are looking to work collaboratively those were the assurances,” he said.

    On when the fuel queues will disappear, he said: “One of the trainings I did not receive is that of a magician but I am working very hard to ensure some of these issues go away‎.

    “And let’s be honest, for the five, six months we have been here, NNPC has moved from a 50 per cent importer of products to basically a 100 per cent importer. And the 445 barrels that were allocated was to cover between 50 and 55 percent importation.

    “So it’s quite frankly share magic that we even have the amount of products at the stations. We are looking to see how to get foreign exchange input. The president and I discussed extensively on how to get more crude directed at importation.

    “His Excellency will rather have less crude but have individuals in the society suffer less with inconveniences than have more crude and have them continue to suffer. So we are going to put a new model to enable us increase the pace and actually get majors as part of the crew of those to bring in more products so that the NNPC will sort of go back on the capacity of what it use to do and the majors will take over the balance of importation,” he added.

    Continuing, he said: “I think if we do that although I don’t want to put a time frame but I will expect that over the next two months. Of course you are aware the DSAP programme begins in April ‎so over the next two months we should see quite frankly a complete elimination of this.

    “Our strategy is that whatever is produced in the refineries will not go for sale, we are going to keep them in strategic reserve.

    “Because the key problem here is that there is no reserve anytime there is gap in supply it goes off,” he said.

    According to him, the next couple of months will be dedicated to moving all the products produced to strategic reserve.

    “So that we can pile up reserves in the nation and that will push up the reserves in the nation. Believe me this is giving me and my team sleepless nights and we are working on it and we are committed to making this go away, Nigerians should please bear with us,” he pleaded.

    The National President of Nigeria Union of Petroleum and Natural Gas (NUPENG), Igwe Achese said that the union was satisfied with deliberations at the meeting.

    He said: “We had a successful meeting, quite interesting in terms of the emotional attachment of Mr. President on the issue of oil and gas sector and the challenges we are facing as a nation.

    “We tabled the issue of fuel scarcity, the quick passage of the PIB and to see how the sector will bounce back economically and to make Nigerians smile again.

    “Clearly we talked more on the corruption on the oil and gas sector, products allocations; Mr. President has assured that both NUPENG and PENGASSAN will continue to be part of the restructuring that he is going to make to look into these issues and to make sure that scarcity is reversed at our filling stations,” he added

    On his part, President of Petroleum and Natural Gas‎ Senior Staff Association of Nigeria (PENGASSAN), Comrade Olabode Francis Johnson ‎said the President was emotionally attached to the oil sector and wanted everything in NNPC to follow due process.

    He said: “We had a very successful meeting with the C-in-C and one of the highlight of the meeting ‎was when he said he created the NNPC and he is emotionally attached to it and that everything that is going to happen in NNPC must follow due process.

    “He said he is concern about what Nigerians are going through and he bears their pains and whatever he is going to do he will do it with their support so that Nigerians can enjoy the benefits of NNPC.

    “As leaders we are very satisfied with what he said, the commitment and the passion he has shown for the industry. PIB is an executive bill; he said all the legal framework will be addressed ‎so that it will be of benefit of Nigerians. He also showed concern for pipeline vandalism and crude oil theft and we know that will support and collaboration he is going to achieve results,” he said.

  • ‘Why Niger Delta must support Buhari’s anti-graft war’

    ‘Why Niger Delta must support Buhari’s anti-graft war’

    A member of the Bayelsa State House of Assembly, Mr. Israel Sunny- Goli of the All Progressives Congress ( APC), Saturday, warned youths in the Niger Delta region against sabotaging oil facilities.

    Sunny-Goli who represents Brass Constituency I said all efforts should be geared towards supporting the efforts of the Minister of State for Petroleum, Dr Ibe Kachikwu and President Muhammadu Buhari to reposition the oil industry.

    He said the current administration was waging war against corruption that had afflicted the oil industry over the years.

    The lawmaker pledged to mobilize the people of his constituency and the Niger Delta to support Buhari’s efforts to sanitize the oil industry.

    He said his team would provide information that would expose economic saboteurs in the coastal communities of the region.

    Sunny-Goli who is the Minority leader and House Committee Chairman on Niger Delta Development Commission (NDDC) spoke in Yenagoa, the state capital.

    He said Kachikwu had demonstrated commitment in reforming the oil sector since his appointment as the Group Managing Director of the Nigeria National Petroleum Corporation (NNPC) and Minister of State for Petroleum.

    He insisted that the people of the region would be the greatest beneficiaries of a reformed oil sector in terms of development and empowerment.

    He said: “President Muhammadu Buhari has provided another opportunity to re-position the oil industry through Dr Ibe Kachikwu and we the people of the Niger Delta especially in Bayelsa must support the efforts of the current administration.

    “The recent decision to build mega filling station in each senatorial district is a welcome development. Aside the fact that it would ensure efficient distribution and country-wide penetration of petroleum products, for us in coastal communities of Bayelsa state it is a welcome development as we would now have access to petroleum products.

    “Also the decision to discuss and negotiate with international oil companies and banks to raise capital for new drilling which would raise Nigeria’s output to 2.5 million barrels per day is a laudable idea which the people of the region must support.

    “The discussions with oil majors on how to revamp oil assets like refineries and decisions to advertise for concessions for pipelines and depots are progressive ideas which the people of the Niger Delta have yearned for over the years.

    “More importantly the discussions with the National Assembly on the need to speed up the Petroleum Industry Bill (PIB) which oil communities would benefit from is what every Niger Deltan should support.”

    On pipeline vandalism and attack on oil facilities, Sunny- Goli commended the recent moves by the Federal Government to mobilize the military to prevent sabotage.

    He stressed that other security agencies should collaborate with the military to rid the Niger Delta region of economic saboteurs.

  • Oil sector mismanagement killing economy, says LCCI

    THE inability of the Federal Government to provide policy direction for growth in oil and gas industry is rubbing off on manufacturing, banking, maritime, and other critical sectors of the economy, the Director-General, Lagos Chamber of Commerce and Industry (LCCI), Mr Muda Yusuf, has said.

    Speaking at an event in Lagos, he said the failure of successive administrations to provide a policy that would facilitate growth in the oil and gas industry is having a spill-over effect on other sectors of the economy

    He explained that oil is the barometer which gauge or measure the growth of the nation’s economy, adding that manufacturing and other sectors will experience growth once the petroleum industry grows.

    Yusuf said many local and foreign investors are willing to invest in the oil and gas sector due to its immense opportunities, noting that there has never been an enduring policies to attract investments and by extension growth to the industry.

    He said when the oil and gas sector experiences boom, as a result of increased activities, other sectors would benefit as well.

    He said when the fundamentals in the oil and gas industry are good, and businesses were recording huge turnovers and profit, people would have money to invest in banking, manufacturing and other sectors.

    According to him, recession in the industry is creeping to other areas of the economy, arguing that well articulated and implemented policies would bring about the desired growth in the economy.

    He said when policies are right the right personnel would be employ to drive the growth of the petroleum industry.

    Lawal said the appointment of Dr Emmanuel Ibe Kachikwu as the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC) was  welcome, in view of problems, such as low investment and activities in the oil sector.

    He said: “The role of the Federal Government is to provide an enabling environment for operators in the oil and gas, manufacturing and other sectors. President Muhammad Buhari has started well by appointing a qualified person to man NNPC. Supposing the country has men of integrity in various sectors, there would not be problems in the economy. People are describing Buhari as a man of integrity; a man who is ready to work for the progress of the country but the question is: What if Buhari leaves tomorrow? What would happen in Nigeria? That is the reason why sustainability of good policies and ideas is key to the growth of the economy.”

    He said there would not be growth in the economy, until the government provides an enabling environment for operators.

    On subsidy, Yusuf said the country cannot afford to be paying trillions of naira as subsidies to major oil marketers approved, by the Federal Government,  to import fuel into the country,

    He said it does not make sense to spend huge amount of money on subsidies, when governments at various levels cannot pay their workers.