The Nation Newspaper

Tag: Oil

  • Relief as Avengers calls off attack plan on oil facilities

    Relief as Avengers calls off attack plan on oil facilities

    There was relief in Delta State Thursday morning following news that the militant group, New Delta Avenger, had called off its plan to cripple oil production in the state through attacks on oil facilities.
     
    The group had threatened to resume hostilities targeting oil facilities and production platforms in the state following its face-off with Governor Ifeanyi Okowa administration on development of oil communities and funding of the state oil producing areas commission, DESOPADEC.
     
    However, in a volte-face on Thursday morning, the group’s leaders said they were retracting the threat in deference to call for peace by Niger Delta leader, Chief Edwin Clark.
     
    “In deference to your authority on issues involving our development and efforts to change the tide of perpetual underdevelopment and treatment as 2nd class citizens of this nation, the highest command of the NDA has decided to shelve our planned attack on major oil facilities in the region from June 30, 2017,” it said it a statement.
     
    “Without prejudice to any ongoing discussion with the Federal Government, we hope that the window of peace will afford you time to take up the issues as you promised with Delta state government.”
    Five members of the group representing the five allegedly marginalised oil bearing tribes signed the document. They urged Clark to reciprocate their gesture by following up on his promise to ensure justice.

  • ‘Nigeria’s oil earnings to fall further’

    Nigeria’s crude earnings may dip further if current realities in the global oil market are anything to go by.

    The country’s oil earnings has reduced to $103.5 million in June 2017, from $114 million recorded in May, this year, and the earnings may decline further if the fall in the prices of crude oil persists. By this, the country has lost $11.5 million within a month.

    Brent crude fell from $47.06 per barrel on Monday, last week to $45.70 on Monday, this week. The price may fall further as the Organisation of Petroleum Exporting Countries (OPEC), struggles with United States shale oil and increased output from Nigeria and Libya.

    The former President, International Association of Energy Economists (IAEE), Prof Adeola Akinnsiju, said the price of crude oil would continue to fall, until OPEC puts concrete measures in place to mitigate increase in production of crude oil by some member countries, among others.

    He said the news of increases in supply by several key producers has weakened OPEC attempt to support the market and boost price through an output freeze.

    According to him, the development will have grave consequences on Nigeria’s economy since it relies on crude oil exports earnings for over 70 per cent of its revenue to run the economy.

    The country had benchmarked its budget at 2.2 million barrels per day and at a price of $42.5 per barrel, before the Senate pushed the benchmark to $44.5 a barrel with hopes that the black gold would stay around $50 a barrel.

  • Nigeria’s oil exports to exceed 2million bpd

    Nigeria’s oil exports to exceed 2million bpd

    • Oil price dips on oversupply

    Nigeria’s crude oil exports are expected to hit two million barrels per day (bpd) in August, the highest level planned for 17 months, as the nation’s oil industry nears a full recovery from militant attacks that crippled production last year.

    Resurgent production, if sustained, will put further pressure on efforts by the Organisation of Petroleum Exporting Countries (OPEC) to cut output to shore up oil prices, Reuters said.

    Meabnwhile, oil prices tumbled yesterday with West Texas Intermediate (WTI) crude prices dropping to a 7-month low, breaking through support levels. The market has been in a distinct bear trend since late May, losing nearly 16 per cent over this period.

    The global oversupply theme has been driving the market lower, despite the OPEC and non-OPEC supply cut to boost price. OPEC and non-OPEC countries had agreement to curb supply by 1.8 million bpd by a further nine months but rising supply in the U.S., Nigeria and Libya, in addition to signs of demand decline in Asia, which is the biggest oil-consuming region in the world, have been weighing on crude prices.

  • Oil prices dip on rising production

    Oil prices dip on rising production

    • Saudi Arabia: oil market to balance in Q4

    Oil prices were flat yesterday after diving 13 per cent since late May as rising production in the United States (U.S.) , Libya and Nigeria have foiled an Organisation of Petroleum Exporting Countries (OPEC)-led effort to support the market by cutting production.

    Brent futures for August were down 4 cents, or 0.1 per cent, at $47.33 a barrel, while U.S. crude for July was down 9 cents, or 0.2 per cent at $44.65 per barrel the day before the July contract expires.

    The premium of the Brent front-month over the same month for WTI WTCLc1-LCOc1 is now at its highest since late May, when producers led by the OPEC extended by nine months its pledge to cut output by 1.8 million barrels per day.

    “Lack of major upside price response to the OPEC output cuts upping the odds of reduced compliance to the agreement in our opinion,” Jim Ritterbusch, president of Chicago-based energy advisory firm Ritterbusch& Associates, said in a note.

    In spite of all these, Saudi Energy Minister Khalid Al-Falih said the oil market is expected to balance in the fourth quarter of this year.

    “The forecasts that the oil market will rebalance in the fourth quarter have taken into consideration the rise in shale oil production,” he said.

  • Oil pipeline vandalism reduces by 12 per cent

    Oil pipeline vandalism reduces by 12 per cent

    The extensive engagement with oil and gas community stakeholders embarked upon by the Federal Government and the Nigerian National Petroleum Corporation (NNPC) has continued to yield positive results with the attainment of 12.77 per cent reduction in downstream pipeline vandalism.
    According to the April 2017 NNPC Financial and Operations report released in Abuja on Monday, downstream pipeline sabotage decreased from 94 pipeline vandalized points in March, 2017 to 82 in April 2017, representing a 12.77% reduction relative to the previous month. 
    The Corporation’s Group General Manager, Group Public Affairs Division,  Mr. Ndu Ughamadu that made this known in a statement yesterday said that the April 2017 numbers also indicate substantial progress compared to corresponding period of April 2016 which recorded 214 incidents. 
    In terms of products availability within the period, the Corporation maintained adequate stock of over 1.2 billion litres of petrol sufficient for more than 34 days forward consumption. 
    It was also recorded that during the period, the NNPC in an effort to reduce to the barest minimum the incidences of fire outbreak in the 21 depots across the country, received bids from no fewer than 37 companies to supply six triple agent firefighting trucks for the operation of the Nigerian Pipelines and Storage Company (NPSC), one of the downstream subsidiaries of NNPC. 
    The report noted that NNPC has continued to import Automotive Gas Oil (AGO) and Aviation Turbine Kerosene (ATK) to supplement local refining, while the Central Bank of Nigeria, CBN continues to make available foreign exchange to marketers to import AGO and ATK. 
    The April 2017 report which is the 21st edition of the NNPC Financial and Operations report also noted that average national daily gas production stood at 242.32 Billion Cubic Feet, BCF or an average of 8,077.19 Million Standard Cubic feet per day, representing 6.79% increase relative to the previous month. 
    Comparatively, the daily average natural gas supply to gas power plants slightly decreased to 672mmscfd (or equivalent to power generation of 2,787 MW in April, 2017) relative to 689mmscfd recorded in last month. However, this supply is also 22.85% higher than the corresponding supply recorded in April 2016 of 547mmscfd, the report stated. 
  • Oil price slumps on oversupply

    Oil price slumps on oversupply

    Oil prices dropped to six-week yesterday, under pressure from high global inventories and doubts about the Organisation of Petroleum Exporting Countries (OPEC’s) ability to implement agreed production cuts.

    Brent crude oil LCOc1 fell 30 cents to $46.70 a barrel, its weakest since May 5 and just above six-month lows, before recovering a little to trade around $46.90.

    United States (U.S.) light crude CLc1 was down 25 cents at $44.48, also not far off six-month lows.

    Both crude benchmarks have lost all the gains made at the end of last year after the OPEC agreed with other big producers to cut output in an effort to prop up prices.

    OPEC and its allies have promised to restrict output until at least the end of the first quarter of next year to try to drain surplus supply.

    But inventories are near record highs in many parts of the world, and many traders expect further price falls.

    Analyst at London brokerage PVM Oil Associates, Stephen Brennock, said: “Oil prices are pinned near their lowest level in seven months,” adding that the market showed “little in the way of upside potential”.Crude prices have fallen about 12 percent since May 25, when OPEC agreed to extend its output limits into next year.

    Despite the deal, some OPEC members, including Nigeria and Libya, have been exempt from cutting and their rising output is seen to be undermining efforts led by Saudi Arabia.

    Despite the deal, some OPEC members, including Nigeria and Libya, have been exempt from cutting and their rising output is seen to be undermining efforts led by Saudi Arabia.

    “OPEC 2017 year-to-date exports are only down by 0.3 million barrels per day (bpd) from the October 2016 baseline,” analysts at AB Bernstein wrote.

    OPEC’s pledge was to cut some 1.2 million bpd, while other producers including Russia agreed to bring the total reduction to almost 1.8 million bpd.

    But production in the U.S., which is not part of the deal, has jumped 10 per cent over the past year to 9.33 million bpd.

    “Production growth in Libya and Nigeria and continued rig additions in the U.S. are complicating the picture, raising doubts on OPEC’s strategy,” AB Bernstein said.

    The U.S. government’s Energy Information Administration has raised its forecast for domestic output growth in 2017 to 460,000 bpd from a predicted decline of 80,000 bpd in December.

    OPEC now expects U.S. production to increase by 800,000 bpd this year. This suggests global oversupply will persist for a while.

    The International Energy Agency (IEA) says it expects oil supplies next year to outpace demand despite consumption hitting 100 million bpd for the first time.

  • Petroleum marketers in Ekiti suspend strike

    Petroleum marketers in Ekiti suspend strike

    The Independent Petroleum Marketers Association of Nigeria (IPMAN) in Ekiti on Sunday suspended its strike.

    NAN reports that IPMAN embarked on the action on May 25, over demolition of some petrol stations and the revocation of some Certificate of Occupancy by the Gov. Ayo Fayose.

    The suspension of the strike is contained in a communiqué issued in Osogbo at the end of a peace meeting called by Gov. Rauf Aregbesola of Osun.

    The communiqué, which was signed by Aregbesola, Fayose and the representatives of the marketers, was made available to newsmen at Osun Government House where the peace meeting was held.

    According to the communiqué, an ad hoc committee would be constituted to fashion out in clear terms the conditions and guidelines for the establishment and operations of filling stations in Ekiti state.

    It stated that the committee, to comprise of representatives of Ekiti state government and oil and gas stakeholders, shall begin work on June 7.

    “In the spirit of reconciliation, the Ekiti government has agreed to pleas for reversal of the revocation of some Certificates of Occupancy of landed properties on which filling stations are built, except the ones on waterways and canals,” the communique said.

    It also stated that the Ekiti government had agreed to stop further demolitions pending the outcome of the committee’s report.

    “The Nigerian Union of Petroleum and Natural Gas Workers (NUPENG), IPMAN and other related oil and gas unions, hereby, suspend the industrial action embarked upon by their members, with immediate effect,” it said.

    Fayose, while speaking with journalists after the meeting, commended the black marketers, who had taken over the streets of Ado Ekiti and other towns.

    He said their services cushioned the effect of the scarcity caused by the strike.

    Fayose, however, said that with the fuel marketers resuming operations, black marketers were sure to fizzle out.

    On his part, Aregbesola said the resolution of the crisis was a confirmation that the people had the capacity to resolve their differences.

    He commended the maturity of his Ekiti state counterpart and the fuel marketers for allowing the crisis to be successfully resolved. (NAN)

  • Oil prices dip on rising output

    Oil prices dip on rising output

    Oil prices fell to a three-week low yesterday on news that Libyan output was recovering from an oilfield technical issue. This fuelled concerns that the Organisation of Petroleum Exporting Countries (OPEC)-led output cuts to reduce global inventories were being undermined by producers outside the deal.

    Benchmark Brent oil was down $1.63, or 3.1 per cent, at $50.21 a barrel after earlier touching $50.12 a barrel, the weakest since May 10. U.S. light crude traded at $48.31, down $1.35, or 2.7 per cent.

    Both contracts were on track for their third straight monthly loss.

    “Unless some bullish news stops this, prices will fall further in particular now with Brent trading below the post-OPEC low and approaching $50 a barrel,” said Carsten Fritsch, commodity analyst at Commerzbank.

    OPEC and other producers, including Russia, agreed last week to extend a deal to cut production by about 1.8 million barrels per day (bpd) until the end of March 2018.

    “Traders covered short positions ahead of OPEC and some of these have now been re-established,” said Ole Hansen, head of commodities strategy at Saxo Bank.

    OPEC members Libya and Nigeria are exempt from the cuts, while U.S. shale oil producers are not part of the agreement and have been ramping up production.

    Libya’s oil production has risen to 827,000 bpd, climbing above a three-year peak of 800,000 bpd reached earlier in May, the National Oil Corporation said, after a technical issue that hitSharara oilfield was resolved.

  • Look beyond oil, Indian military chief urges govt

    The Senior Directing Staff (SDS) at the National Defence College of India, Maj.-Gen. Vinaya Chandran, has urged the Federal Government to focus on other sectors of the economy, particularly agriculture, to move the country forward.

    He spoke yesterday when his team visited the Western Naval Command (WNC) of the Navy in Apapa.

    He said the 14-man delegation, comprising India’s senior policy makers and security chiefs, was in the country to practicalise international relations and diplomacy, which is one of the courses at the NDC.

    Gen. Chandran said he was impressed that the Nigeria he has seen contradicted the one he reads about.

    “But Nigeria is peaceful, except for some isolated issues. It is like India. It is not crisis-ridden as we were made to believe by western newspapers.

    “Most of the things we read in newspapers and magazines are based on what the Western media published; there are very few Nigerian newspapers or magazines for us to read there (Indian).

    “We thought there was so much lawlessness and insurgency going on in Nigeria, but it is not so. Rather, it is peaceful and we feel Nigeria has a great future.

    “The moment the Nigerian government finds something to do other than oil, like agriculture and education, this country will become more economically developed. Nigeria has a lot of resources.”

    Gen. Chandran, who congratulated the Navy on its 61st anniversary, said that an Indian Navy Ship will visit next week and partake in the celebration.

  • Ijaw youths reject PIB passed by Senate

    Ijaw youths reject PIB passed by Senate

    Ijaw youths have rejected the Petroleum Industry Governance Bill (PIGB) recently passed into law by the Senate.

    The youths under the auspices of the Ijaw Youth Council (IYC) Worldwide, said passing such version of the Petroleum Industry Bill (PIB) portrayed members of the Senate as insensitive lawmakers.

    IYC in a statement signed by its Spokesman, Mr. Henry Iyalla, said the PIGB which failed to provide special funds for oil-producing communities would not guarantee peace in the Niger Delta region.

    Iyalla said: “We condemn the show of insensitivity by the Nigerian Senate on the recent passage of the Petroleum Industry Governance Bill (PIGB) which makes it clear that the only interest the government has in the Niger Delta Region is control of her oil.

    “It is unfortunate that at a time when we expect the Government to show commitment in the development of the region we have to contend with the celebration of an ill-conceived idea to divide the Petroleum Industry Bill (PIB) into greed-driven mushroom bits”.

    He insisted that the only PIB that would ensure peace in the region and calm frayed nerves must include the Oil Communities Fund Act.

    He said such Act would give the Niger Delta people a stake in the industry and provide avenues to alleviate the suffering of the people in the region adding that without such funds any governance structure put in place in the region would fail.

    He said: “It must be stated that for oil and gas related activities to operate smoothly within the Niger Delta Region, the National Assembly saddled with the responsibility of law-making should immediately take further steps for the quick passage of the Host Community Bill.

    “This is to guarantee 10% of the net profit of upstream oil companies on both onshore areas and offshore shallow areas to the community.

    “Otherwise, the Niger Delta would see the recent passage of the PIGB as a calculated move aimed at making laws for the smooth governance of exploitation and exploration of the abundant oil reserve within the region without any consideration to host communities.

    “The Ijaw Youth Council would not be part of a divide and rule method of governance within the oil and gas operations in the region.

    “It should be known by all relevant Arms of Government that the singular passage of the PIGB will not deliver the full benefits of the intended reforms except the other aspects of the Petroleum Industry Bill (PIB) are legislated upon.

    “The passage of the complete Petroleum Industry Bill (PIB) is the only guarantee for a smooth and conducive operational environment in the Niger Delta, as the people of the region cannot guarantee conducive operational base without the protection of their interest”.