The Nation Newspaper

Tag: Oil

  • Oil hits five-month high above $71 on Libyan supply threat

    Oil hit a five-month high above 71 dollars a barrel on Tuesday, supported by concern that violence in Libya could further tighten supply already squeezed by OPEC cuts and U.S. sanctions on Iran and Venezuela.

    International benchmark Brent futures hit their strongest level since last November at 71.34 dollars per barrel, before easing to 70.99 dollars per barrel by 0700 GMT.

    U.S. West Texas Intermediate (WTI) crude oil futures also hit a November 2018 high, at 64.77 dollars per barrel, before easing to 64.42 dollars per barrel.

    Oil markets have tightened this year as the United States imposed sanctions on oil exporters Iran and Venezuela while the producer club of the Organisation of the Petroleum Exporting Countries (OPEC) has been withholding supply to prop up prices.

    Brent and WTI futures have risen by 40 per cent and 30 per cent respectively since the start of the year.

    Goldman Sachs, an American multinational investment bank and financial services company, said an oil supply deficit had opened up early this year.

    “We expect the drivers of this deficit to persist through 2Q19” due to a shock and awe implementation of the OPEC cuts,” the U.S. bank said in a note.

    Goldman said it expected Brent to average 72.50 dollars per barrel during the second quarter, up from a previous forecast of 65 dollars per barrel.

    Prices have been further lifted this week by escalating violence in Libya, a significant supplier of oil to Europe, which produced around 1.1 million barrels per day (bpd) of crude in March.

    Eastern forces on Monday were advancing on the Libyan capital Tripoli in the latest of a cycle of warfare since Muammar Gaddafi’s fall in 2011, with a warplane attacking the city’s functioning airport.

    Read Also: Businessman arraigned for ‘dealing’ in substandard engine oil

    Yet despite generally bullish oil markets, concerns that an economic slowdown this year will hit fuel consumption have been preventing crude prices from rising even higher, traders said.

    And while fears of a global recession ebbed following strong U.S. jobs figures and improved Chinese manufacturing data late last week, Bank of America Merrill Lynch said there was still a “significant slowing in growth globally” in 2019.

    The bank said it expected Brent and WTI to average 70 dollars per barrel and 59 dollars per barrel respectively in 2019, and 65 dollars per barrel and 60 dollars per barrel in 2020.

    Goldman Sachs also said oil prices “will decline gradually from this summer as shale and OPEC production increases.”

    Russia, not an OPEC-member but a reluctant participant in the supply cuts, signaled on Monday it wanted to raise output when it would meet with OPEC in June because of falling stockpiles.

    In the United States, crude oil production has risen by more than 2 million bpd since early 2018, to a record 12.2 million bpd, with many analysts expecting output to exceed 13 million bpd soon.

  • Indigenous players roll out strategies to grow oil sector

    The indigenous players in Nigerian oil and gas down-stream sector have stated that for sustainable growth in the Nigeria Oil & Gas Industry, a paradigm shift is required.

    The Managing Director/CEO, First Exploration & Petroleum Development Co. Ltd, who doubles as the Chairman, Independent Petroleum Producers Group (IPPG), Ademola Adeyemi-Bero  disclosed this recently in Lagos, at 16th Annual Aret Adams Memorial Lecture Series 2019, with theme “Emerging Middle Level Producers in Oil & Gas Industry, Challenges and Opportunities.”

    Adeyemi-Bero noted that collaboration would deepen the effectiveness of IPPG and OPTS participation, adding that it will go a long way enhancing productivity level.

    He said, “Credible contractor finance, which is in charge of financing offtakers, (Offtaker-Bank Financing) to offtake rights and forward-sell/RBL infrastructure, and financing capital markets is required to grow the industry.)

    He outlined others as energy fund, which will be undertaken by Energy Bank, adding that Joint Partnership with International Oil Companies (IOCs) is paramount to foster growth in the sector.

    Commenting on the growth focus for the sector he said; “Growth focus for Nigerian E&P Companies & Making the Quantum Leap (QL) is growing reserves and production to meet the target of 40 billion Barrels and 4 million Barrels per day in 2025. Indigenous operators will participate in the growth of production in the Nigeria’s JV Heartland of Onshore, Swamp and Shallow Water.

    “Employment opportunities sustained with indigenous companies indigenous operators are demonstrating a successful model to effectively engage host communities across areas of operation. Indigenous operators contribute 53 percent of Domestic Gas Supply (DGS) requirements, and are committed to further growing this supply capacity to 80 percent. Domestic gas supply can happen through partnership and collaboration with indigenous companies. currently at 1bcf/day.”

    He demanded that indigenous operators willing and able to meet crude oil and NGL supply requirements for refinery and petrochemical should be given priorities, stressing that indigenous companies contributing to petroleum products would be supplying 100 percent  of 1.2 million barrels per day refining capacity by 2020.

    He stated that 35 Nigerian Indigenous / Independent upstream producers are operating over 370,000 bpd, regretting that production stagnate around 2.0 million barrels of oil per day.

    He complained that Huge Gas Resource Basin development is constrained by infrastructure and enabling fiscal / pricing framework, saying that the operating environment is unacceptably high “above ground risk.”

    “Growth to 3.0 million barrels of oil per day (with a 1.2 Reserves Replacement Ratio), Enabled Gas Supply satisfying the diverse Demand and Market Offtake, Sustainable Development of the Niger Delta and License-to-Operate are some of our necessities,” stressedAdeyemi-Bero.

    Commenting on the growth of Nigerian players he stated; “FGN license award to indigenous companies 1970: FGN awarded first exploration award (2No.) first Indigenous Producer Dubri Oil (Gele Field) in 1987. NDPR (NDEP) awarded Ogbelle Marginal Field (1st marginal Field) FGN introduced Indigenous Operatorship Program (IOP) in 1990 (20 Awards – 12 IOCs and 8 Indigenous Co.) Over 40 indigenous licenses granted by 1998.”

    “Growth Phase II – 2001 – 2008. Federal Government Marginal Field Program engendered growth of Nigerian independents. 24 Marginal Fields awarded to 31 Indigenous companies, 12+ Fields in production to date.

    “Growth Phase III: 2009 – Date. Divestment by Major IOCs has significantly deepened the growth of Nigerian Independents. 15 indigenous independents oil companies acquiring divested assets with current production capacity of about 180,000 barrels of oil/ day, ccontributing about 15% of Nigeria oil production, aspire to the 30% – 50% level at 3mmbopd.  Crude Production: 370kbopd (approx.),” he maintained.

  • Oil reaches $68 on falling supplies

    Oil prices rallied yesterday after data showed falling stockpiles of crude as refined fuels also plunged last week.

    International Brent crude oil futures were up 74 cents, or 1.2 per cent, at $68.35 a barrel hitting a new high going back to Nov. 13.

    U.S. West Texas Intermediate crude futures rose $1, or 1.7 per cent, to $60.03 per barrel, after its highest level since Nov. 12. The more heavily traded WTI contract for May delivery also rose above $60 a barrel yesterday.

    WTI has rallied 32 per cent this year after losing nearly half of its value in the final months of 2018. Brent is also up more than 27 per cent year to date, boosted by production cuts from the Organisation of Petroleum Exporting Countries (OPEC) and United States (U.S.) sanctions against Iran and Venezuela.

    Nigeria’s state-run oil firm, the Nigerian National Petroleum Corporation (NNPC) assured that it will achieve the 2.3million barrel per day production (mb/d) volume-target for the 2019 budget. It said measures have been put in place to attain the feat.

    In a presentation to the Senate Committee on Finance on the 2019  – 2021 Medium Term Expenditure Framework (MTEF),  its Group Managing Director,  Dr. Maikanti Baru, said with improved security in oil bearing communities as a result of sustainable community partnership, the industry was confident of attaining the production target.

    Represented by the firm’s Group General Manager, Corporate Planning and Strategy,  Mr. Bala Wunti, the GMD said though the country had production capacity of over 2.5mb/d, the unfortunate security situations of the past in areas of operation made it difficult to achieve desired production targets.

    Baru said: “The current administration under President Muhammadu Buhari is strongly focused on engagement and sustainable community partnership which has resulted in improved security and production. This will further improve and we are thus confident of achieving the 2019 budget production target.”

    On the possible impact of OPEC quota on production target, Baru said the production target of 2.3mb/d was a combination of liquid hydrocarbon production comprising crude oil and condensate, noting that the OPEC quota only covers crude oil production.

    He said with the country’s condensate production currently oscillating between 400,000 to 600,000 bpd, the country was in a good position to attain the overall production benchmark. He said  the firm was working assiduously with other relevant agencies to ensure the attainment of the 2019 budget assumptions contained in the 2019 – 2021 Medium Term Expenditure Framework (MTEF).

    Dr. Baru also said Nigeria’s  oil grade traded higher than Dated Brent, attributing the development to the recent reforms in the crude oil management regime with emphasis on entrenching pricing transparency and performance.

    He restated NNPC’s commitment to transparency and efficiency in every aspect of its operations, stressing that under his watch, the corporation had recorded considerable gains in all the thematic indicators.

  • LCCI seeks reform in oil, gas industry

    The Lagos Chamber of Commerce & Industry (LCCI) has advised the Federal Government to improve the regulatory environment in oil and gas industry to unlock huge foreign direct investment (FDI) in the sector, especially in gas and deep-water exploration.

    Its President, Babatunde Ruwase in a statement, said this is one of the major objectives of the Petroleum Industry Bill (PIB).  He regretted that the journey for its legislation started over 15 years ago, adding that not much progress has been made till date.  He requested that a more expeditious consideration be given to the bill through appropriate collaborative actions with the National Assembly.

    According to him, crude oil export is the biggest foreign exchange earner but sadly the biggest foreign exchange expenditure is also on the importation of petroleum products.

    He said: “Increases in crude oil price benefits the Nigerian economy with regards to foreign exchange earnings but penalises the economy in terms of the huge foreign exchange commitment to importation of refined petroleum products and high energy cost. We need to prioritise local refining of petroleum products to ease pressure on our reserves.”

    He further requested the intervention of the Presidency to reduce the burden of excessive taxation on oil and gas investors in the country. He called the attention of government to a proposal by the Nigeria Ports Authority (NPA) to impose $1 levy on every barrel of oil export and new levies proposed under the National Oil Spill Detection and Response Agency (NOSDRA) amendment bill, including the Maritime University amendment bill.

    Ruwase also sought protection for the manufacturers of gas cylinders to promote industrialisation, self-reliance and conservation of foreign exchange.

    According to him, there is already a huge capacity to meet local cylinder demands.

    On the power situation, the LCCI chief acknowledged the efforts by the government to improve liquidity in the power supply chain, the drastic reduction in the debt owed to gas suppliers and the generating companies, improvement in power generation, and the enhancement of carrying capacity of the transmission grid.

    He argued that a chain can only be as strong as its weakest link as in this case the distribution end is still grappling with numerous challenges which limit the capacity to deliver power to end users.  According to him, the power situation continues to pose challenges to business operators as there were complaints across all sectors about high energy costs, especially high expenditure on diesel.

    He noted that the situation had worsened with the increase in global crude oil price. A situation where businesses spend between 20 and 30 per cent of their total operating cost on generating power is not the best, he said.  He said policies and incentives should be put in place to encourage decentralisation and more off grid solutions.

    He said: “The government should encourage and facilitate more off grid power generation for improved access to power.  The Aba and Sura market power initiatives should be widely replicated across the country.”

    On access and cost of credit for Medium Small micro Enterprises (MSMEs), he said it is still a major concern to the Small medium Enterprises (SMEs) sector.

     

  • Local content is essential to oil, gas

    Samsung Heavy Industries Nigeria (SHIN) Limited Managing Director Mr. Jejin Jeon, in this interview with Sunday Oguntola speaks on the importance of local content in the oil and gas sector, among other issues.

    What is your assessment of the local content legislation in oil and gas industry?

    It’s fair to say that ‘local content’ regulations don’t sound like the most interesting topic in the world.  Any manager of any oil or gas project is going to be focused on hitting their targets and rightly so.  Time is money, and in the energy sector this is particularly the case. With this target mindset, it’s easy to dismiss local content regulations as additional bureaucracy or a box to be ticked to win the tender.

    How did you cope with this piece of legislation?

    I think that Samsung Heavy Industries Nigeria could have fallen into this trap too. After all, we were a new arrival in Nigeria, eager to prove ourselves and to win business for our company.Thankfully though, we are new to Nigeria, we are by no means new to shipbuilding in a developing economy. It might seem difficult to remember this today but when our first shipyard was being constructed in 1974, Korea was a very different country.  We too had to deal with the twin challenges of undertaking immense economic growth while improving the standard of living for our citizens. We learnt that you had to be agile and adapt to a fast-changing world, and that you have to keep transformation at the core of what you do.

    You have reputation as a global shipbuilding giant. What gives you competitive edge over your competitors in the Nigerian environment?

    Ship building has two faces like Janus, the Roman god. On the one hand, it is a high-tech, innovative business, which demands the best.  On the other hand, it requires hard work and an intense level of human capital. By understanding this dual nature of shipbuilding, we were able to design a local content programme that delivered opportunities to Nigeria, while delivering cutting-edge technology. This blend of global and local has proven to be perfectly suited to delivering on customer needs, satisfying local content requirements and creating a sustainable platform for long-term growth. And when Samsung says long-term, it means long-term.  Building a welding school means opportunities for our impressive local workforce, skilled welders, such as Chinonye, who are learning skills and sharing knowledge. But it also means looking to the next decade and beyond, understanding the potential of Nigeria to be a focal point for fabrication and integration for the whole of Africa. We have proven that responsible investment, powered by a belief in people, unlocks potential that can drive real change.  Our fabrication and integration yard in Lagos is the start of our journey in Africa, and it’s a journey that will deliver jobs, opportunity and economic prosperity for the country and beyond.

    What is your future vision?

    Our vision is a future of extraordinary growth and opportunity, building on our now-proven model for heavy involvement of local companies and local workforce talent. The combination of Korean efficiency and expertise, fused with Nigerian talent and passion, presents limitless possibilities for a future repairing, maintaining and building high value ships to serve needs in Africa and beyond – just watch this space.

  • Expert laments Nigeria’s low oil output

    A combination of factors may be responsible for the nation’s dwindling oil output, chief among which is the problem of under capacity utilisation, poor participation of local experts, Mr. Ademola Adeyemi-Bero has said.

    The former staff of Shell Petroleum Development Company who was a guest speaker at a public forum organised to commemorate the 16th Aret Adams Memorial lectures, in Lagos, said it was anybody’s guess why Nigeria’s oil fortunes has not improved considerably over the years.

    Specifically, Adeyemi-Bero, who sits atop as the Managing Director/CEO, First Exploration & Petroleum Development Company Ltd, said indigenous participation in the petroleum exploration was at a paltry 15 per cent .while expatriates dominate the remaining 85 per cent.

    Going down memory lane, the Chairman, Independent Petroleum Producers recalled that over 45 years ago when some Nigerians got licence to operate the first marginal fields but never maximised the opportunity.

    This, he said, may have contributed to the slow pace of local expertise in the oil and gas sector.

    Adeyemi-Bero, who spoke on ‘Emerging Middle-level producers in Nigeria oil and gas industry: challenges and opportunities,’ said, thankfully the narrative is changing as some new crop of local petroleum producers have since taken up the challenge.

    While noting that the nation’s current output which oscillates between 2m-2.1m barrels per day, would remain stagnant unless certain conditions are met, he said there is need for concerted effort to drive growth in the sector.

    Expatiating, he said,  Nigeria requires a steady investment of $25b annually to be able to generate 3m barrels per day.

    To achieve this, he said there is need for synergy of cooperation between foreign investors and their local counterparts.

    “35 independent producers have made inroad into the otherwise foreign dominated sector. With concerted efforts by the different stakeholders we believe we can boost our current output of 370,000 barrels by the independent producers,” he said.

    Speaking earlier, the Chairman of the occasion and former Country Chairman/Managing Director, Shell Petroleum Development Company, Mr. Basil Omiyi who spoke glowing of the exploits of Aret Adams said his contributions to the oil and gas sector was a quantum leap even as he urged present crop of professionals in the sector to imbibe the ideas and ideals of the late icon.

    In his earlier remarks, Chairman, Board of Trustee, Aret Adams Foundation, Charles Osezua said there was need for more collaboration on the part of operators.

    The event, drew participants from far and near including Mrs. Izarene Adams, matriarch of the Aret Adams family, friends and associates as well as captains of industries including ex Minister of State for Petroleum Resources, Ajein Ajumogobia, Mr Nosa Omorodion, etc.

  • IPMAN fails to sell petrol at N140

    Members of Independent  Petroleum Marketers Association of Nigeria (IPMAN) has refused to comply with its leadership to sell petrol to customers at N140 per litre. The product currently sells for between N143 and N145 per litre.

    Its leadership had directed the oil marketers to sell the product at N40 per litre in the run up to the general elections.

    However, the Caretaker Chairman of IPMAN Western Zone, HRH Obafemi Ogbaro, has appealed to members to comply with the directive.

    He made the appeal after the chapter’s executives meeting in Lagos.

    Ogbaro said: “My attention has been drawn to a purported press statement credited to a marketer in Mosinmi depot who was a former vice chairman of IPMAN western zone denouncing the directive of our IPMAN National President, Elder Chinedu Okoronkwo, to our patriotic members to sell petrol to the general public at N140 per litre.”

    He said the association took the decision to ameliorate the suffering of the masses because of the rescheduled elections, adding that IPMAN members as a responsible association felt the pains Nigerians suffered for travelling to their various destinations to perform their civic duties of voting the candidates of their choice in the Presidential, National Assembly, Governorship and State Assembly elections which was rescheduled to  February 23, 2019 and  March 9, 2019 respectively.

    He said the group  shared in the pains of Nigerians hence  the sacrifice in this trying period to agree to a N5 per litre reduction. “This will eat into our members’ profit but we have to give back to the society as part of our Corporate Social Responsibility. The reduction in price commenced from Wednesday, February 20, 2019 to  March 11, 2019.

    The national president of IPMAN, Elder Chinedu Okoronkwo on February 17 directed its members nationwide to reduce petrol pump price from N145 per litre to N140.

    He had said: “The reduction will last till March 12 to help reduce transport fares for Nigerians as they travel to vote for their candidates for the presidential, National Assembly, governorship and House of Assembly elections. After that date, we will review the price.”

  • Kachikwu: oil, gas tracking’ll improve transparency

    The Minister of State, Petroleum Resources, Dr. Ibe Kachikwu, has said the Department of Petroleum Resources’ (DPR) Crude Oil and LNG Tracking (COLT) and other automation initiatives will improve operational transparency in the oil and gas industry.

    Speaking during a ministerial briefing on key achievements of the DPR on COLT and other automation initiatives of the oil and gas regulator in Lagos yesterday, he said some of the automation initiatives include the Automatic Downstream System (ADS), Accelerated Lease Renewal Programme, and forensic examination of questionable vessels bringing petroleum products into the country.

    The initiative will track transparency in operations such as licensing of petrol stations, track actual oil production volumes, royalty recovery and production cost reduction, among others.

    Kachikwu said his clear mandate as a Minister of State is to try and change the oil industry, because it was looking like a value dip in terms of the reputation of the industry and some of the issues of corruption that were all over the place.

    He said: “Whilst we are celebrating a whole lots of things that we have done, the 7-Big Wins, NNPC Restructuring, the cash call issues, subsidy removal at some point, the reality is that DPR has been a regulator that has been working very hard and when they eventually got to the milestone that we have today, I said it should let people know what they have been doing over the last couple of years.

  • Nigeria’s investment prospects in oil, gas high

    James Shindi is the Chief Executive of Brevity Anderson, organisers of the annual Nigeria Petroleum International Summit (NIPS). In this interview with reporters, he talks about the investment prospects Nigeria has in the oil and gas industry and NIPS 2019, among others, EMEKA UGWUANYI was there.

    How attractive is Nigeria for oil and gas investment?

    If you take into account Nigeria’s condensates production, the daily average production is over 2 million barrels. There is a very realistic capacity to upscale the country’s proven reserves to 40 billion barrels within the next few years, so this market will continue to remain attractive for a long time.

    Even if there are no new oil finds, you are looking at another 45 years or so of supply at current rates. However, when you start to look at the huge gas reserves of well over 5 trillion cubic metres, which ranks Nigeria as possessing Africa’s largest gas reserves, the picture looks even better. This surely has to be the investment destination of choice and will continue to be.

    What is the Federal Government’s objective for organising the annual international petroleum summit?

    The Federal Executive Council (FEC) took the decision to approve the event in its current format with a private sector operator to create an international platform for high-level discussions around the hydrocarbons sector, which helps lead Africa’s response to the current and future challenges in the sector. It is one of the ways Nigeria continues to provide leadership in the sector on the continent.

    The event, being the property of the Federal Government, also means that all key government decision makers attend to network, provide answers to burning questions and also, listen to feedback from stakeholders. And with a focus on technology and innovation, the aim is to grow the event into a must attend meeting for unveiling of major technological breakthroughs. We are already starting to see this happen and we at Brevity Anderson feel absolutely delighted to be on this journey with the Federal Government.

    What is the main thrust of this NIPS2019?

    Issues around oil market stability continue to be on every stakeholder’s front burner. When you speak to both producers and consumers, you soon get the sense that price volatility hurts both sides. This sort of market instability means that investment decisions are either delayed or in some instances scrapped. Since 2014, we have been seeing more and more producers turning exclusively to short-cycle projects, the long-term effect of this will definitely have an impact beyond just oil markets.

    Within the context of Organisation of Petroleum Exporting Countries (OPEC) and African Petroleum Producers Organisation (APPO), Nigeria continues to play a leading role in driving talks to help stabilise the market. I would like to stress here and at the same time, commend the Federal Government for deliberately taking concrete steps as part of a bigger strategy of bringing down production costs while initiating the right policies to attract additional investment.

    For example, the Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu, announced a roadmap to attract an additional $10 billion worth of new investment into the sector in Nigeria alone. We are seeing a real shift from just talk to tangible action.

    Against this background and the technological advancement (or lack of it in some regard), geo-political activities and other very existing topics, the event creates the perfect platform to engage stakeholders as the event will take place at different levels; Government-to-Government, Business-to-Business and Government-to-Business. Nigeria International Petroleum Summit (NIPS) 2019 will certainly be the place to be between January 27 and 30, 2019.

    ‘’We are glad to report to you that we have received significant amount of interest from both local and international players including national delegations from seven countries, headed by top political and economic leaders.

    For example, Khalid al-Faliih, the Saudi Energy Minister, during his recent visit to Nigeria, specifically mentioned that Africa and in particular, Nigeria, remains a key partner in forging partnerships and he is looking forward to returning to our great country in 2019 both to the NIPS event and to further deepen the special relationship between both countries.

    Amongst other international delegates, the Norwegian State Secretary (Deputy Minister) for International Development Jens Frølich Holte also confirmed his participation at the NIPS 2019.

     

    What are the highlights of NIPS 2019?

    NIPS 2019 comes up between January 27th and 30th, 2019. There will be a Ministerial Session, an Executive Round Table, a session on OPEC, Energy Revolution, Offshore & Marine Session, amongst other interesting sessions. There will also be some pleasant surprises. I will not be letting the cat out of the bag yet. However, we are excited to announce that at NIPS 2019, we will be incorporating the Honorary Patron’s Dinner/Awards, where Patrons and Corporates will be honoured during a spectacular evening of business, culture and fanfare. The evening is sponsored by Total.

    We are planning for about 100 top-level speakers from both Nigeria and abroad. To date, we have confirmed attendance from over 45 countries with more being expected. We are planning to welcome 3,000 participants, including visitors. Certainly, NIPS 2019 will be the place to be to make those deals happen. For instance, for capacity issues, we have now decided to move the official opening ceremony of Monday 28th January 2019 to the Nicon Luxury Hotel while the main conference and exhibition will still hold at the International Conference Centre, just next door once the opening ceremony is concluded.

    How will this year’s edition be beneficial to participants and exhibitors?

    The event will be attended by top decision makers from both the public and private sectors and staged on a government-to-government, business-to-business and government-to-business levels, thus, there will be something for everybody. The reports from this event go directly to the highest levels of decision-making. This is certainly not just another talk shop.

     

    What kind of support are you currently receiving from stakeholders including OPEC?

    The support has been tremendous. The OPEC Secretary General, Dr. Mohammed Barkindo, led an official delegation to the maiden edition in 2018 and they will again be attending with an official delegation, along with other key stakeholders in 2019. From an organisational point of view, the NNPC under the leadership of Dr. Maikanti Baru and as the national host has been unwaveringly robust in its drive to make a success of NIPS 2019. Our media partners are working round the clock to promote the event in new and creative ways. The Presidency, PEF, PPPRA, DPR, PTDF, PTI, NCDMB have all been tremendous in their support.

    We have the outstanding Minister of State Dr. Ibe Kachikwu and his excellent team of lieutenants who continue to make themselves available literally round the clock. We have enjoyed the best possible working relationship any PPP partner could wish for. The civil service structure at Federal Ministry of Petroleum Resources driven by the amiable Permanent Secretary, Dr. Folashade Yemi-Esan has been immense. To put this into context, some of our planning meetings have held on weekends and we have had the Minister of State and the Permanent Secretary sit through hours of details each time. The heads of the various agencies under the Ministry of Petroleum have also been exemplary to say the least. The support of the Executive Secretary of NCDMB, Simbi Wabote, has been colossal. You get the sense that NIPS is indeed a national treasure that is here to stay.

     

  • Nigeria’s investment prospects in oil, gas high

    James Shindi is the Chief Executive of Brevity Anderson, organisers of the annual Nigeria Petroleum International Summit (NIPS). In this interview with reporters, he talks about the investment prospects Nigeria has in the oil and gas industry and NIPS 2019, among others, EMEKA UGWUANYI was there.

    How attractive is Nigeria for oil and gas investment?

    If you take into account Nigeria’s condensates production, the daily average production is over 2 million barrels. There is a very realistic capacity to upscale the country’s proven reserves to 40 billion barrels within the next few years, so this market will continue to remain attractive for a long time.

    Even if there are no new oil finds, you are looking at another 45 years or so of supply at current rates. However, when you start to look at the huge gas reserves of well over 5 trillion cubic metres, which ranks Nigeria as possessing Africa’s largest gas reserves, the picture looks even better. This surely has to be the investment destination of choice and will continue to be.

    What is the Federal Government’s objective for organising the annual international petroleum summit?

    The Federal Executive Council (FEC) took the decision to approve the event in its current format with a private sector operator to create an international platform for high-level discussions around the hydrocarbons sector, which helps lead Africa’s response to the current and future challenges in the sector. It is one of the ways Nigeria continues to provide leadership in the sector on the continent.

    The event, being the property of the Federal Government, also means that all key government decision makers attend to network, provide answers to burning questions and also, listen to feedback from stakeholders. And with a focus on technology and innovation, the aim is to grow the event into a must attend meeting for unveiling of major technological breakthroughs. We are already starting to see this happen and we at Brevity Anderson feel absolutely delighted to be on this journey with the Federal Government.

    What is the main thrust of this NIPS2019?

    Issues around oil market stability continue to be on every stakeholder’s front burner. When you speak to both producers and consumers, you soon get the sense that price volatility hurts both sides. This sort of market instability means that investment decisions are either delayed or in some instances scrapped. Since 2014, we have been seeing more and more producers turning exclusively to short-cycle projects, the long-term effect of this will definitely have an impact beyond just oil markets.

    Within the context of Organisation of Petroleum Exporting Countries (OPEC) and African Petroleum Producers Organisation (APPO), Nigeria continues to play a leading role in driving talks to help stabilise the market. I would like to stress here and at the same time, commend the Federal Government for deliberately taking concrete steps as part of a bigger strategy of bringing down production costs while initiating the right policies to attract additional investment.

    For example, the Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu, announced a roadmap to attract an additional $10 billion worth of new investment into the sector in Nigeria alone. We are seeing a real shift from just talk to tangible action.

    Against this background and the technological advancement (or lack of it in some regard), geo-political activities and other very existing topics, the event creates the perfect platform to engage stakeholders as the event will take place at different levels; Government-to-Government, Business-to-Business and Government-to-Business. Nigeria International Petroleum Summit (NIPS) 2019 will certainly be the place to be between January 27 and 30, 2019.

    ‘’We are glad to report to you that we have received significant amount of interest from both local and international players including national delegations from seven countries, headed by top political and economic leaders.

    For example, Khalid al-Faliih, the Saudi Energy Minister, during his recent visit to Nigeria, specifically mentioned that Africa and in particular, Nigeria, remains a key partner in forging partnerships and he is looking forward to returning to our great country in 2019 both to the NIPS event and to further deepen the special relationship between both countries.

    Amongst other international delegates, the Norwegian State Secretary (Deputy Minister) for International Development Jens Frølich Holte also confirmed his participation at the NIPS 2019.