The Nation Newspaper

Tag: Oil

  • Who owns the oil? (1)

    There is no controversy as to where Nigeria’s oil belt lies. Niger Delta holds the ace. But that is where the clear line ends. Itsekiri, Ijaw, Urhobo, Ibibio, Efik and Annang have their own tales to tell about who owns the oil or who owns the most oil and, by extension, who contributes the more to the nation’s coffer.

    Different states, such as Bayelsa, Rivers, Akwa Ibom and so on, also have one story or the other to tell about who has more oil and who the golden chick that lays the golden egg is. Bayelsa, for instance, believes the Federal Government has been unfair to it in sharing the proceeds of oil. Its governor, Seriake Dickson, said this much a few weeks back while explaining to his people why he has been unable to pay salaries and allowances in some six months.

    In this rat race, the fact that diversity requires the acceptance of the other side has been long lost. As such, what we have seems to be a society built on clannish virtues. What else can we have when bad blood has pursued mutual peace into a cul-de-sac! And in a situation where ethnic firefights now openly romance self-interest, what else can it birth other than acrimony.

    In this era of unrest in the oil-rich region, the question of who owns the most oil has propped up again. Even though the Ijaw seem to be more vocal in the agitation in the region, the others are insisting that any discourse in search of peace must involve all ethnic stocks in the region. And to add salt to injury, someone from the North not long ago chose to play the Devil’s advocate by claiming the oil in the Niger Delta for his region. I wonder what formula can be used to share Mukoro’s estate and Abdullahi will get the chunk. These are indeed interesting times.

    The oil tale is a complex one. Very complex. The off-shore and on-shore dichotomy is one principle that many in the region will be glad to see dead. It cedes all crude oil on water to the Federal Government. This has ensured that a state like Cross River is not entitled to the 13 per cent derivation fund enjoyed by Bayelsa,  Rivers and others. Cross River used to enjoy it until a Supreme Court ruling ceded all its off-water oil to Akwa Ibom State.

    The oil debate did not start today. It started even before Nigeria took its first step. Whatever grievance made the late Isaac Adaka Boro declare war on Nigeria was laced with the Ijaw’s claim to the ownership of the oil. Whatever made the Urhobo change the name of the Olu of Warri to Olu of Itsekiri had a lot to do with ownership of the land and the oil therein.  Whatever ensured the EPZ in Delta never got off the ground under ex-President Goodluck Jonathan had the oil debate wrapped around its neck. Whatever led to the militarisation of the region cannot be divorced from the quest to declare who owns the oil.

    The debate can also not be divorced from the attitude of an average militant in the Niger Delta to illegal oil bunkering. As far as he is concerned, it is not possible to be accused of stealing what is yours. Like the lead character in Lancelot Imasuen’s “Invasion 1897”, who was tried in court for stealing a Benin bronze in a British Museum, an average Ijaw militant will easily declare that it is wrong to be accused of stealing what one’s forbears bequeathed to one.

    The oil debate gave rise to the 13 per cent derivation and all the interesting rings that have formed about it.

    Between 1999 and 2014, the nine oil-producing states earned N4.19 trillion as derivation. Cross River stopped earning derivation fund in July 2012 having lost its oil wells to Akwa Ibom after a Supreme Court ruling. This means only eight states have been sharing derivation fund since 2012.

    The Federal Account Allocation Committee (FAAC) records show that from May 1999 to July 2014, the six Southsouth states got N2.511tr (about 60 per cent of the total sum).

    Rivers State got N1.03 trillion, the largest chunk of the derivation funds. It was trailed by Akwa Ibom, which earned N910b; Delta received N792.5b, Bayelsa N721.9b; Edo got N47.1b and Cross River N38.7b.

    The three oil-producing states outside the Southsouth got N280.6 billion within the period. Specifically, Ondo got N176.7b; Imo received N57b and Abia was allocated N46.9b.

    What these figures tell us is that Rivers seems to have the most oil. But it is not that simple. For the people, the on-shore/ off-shore dichotomy stole part of their oil and gave it to the Federal Government. Thus, they feel that in deciding who owns the most oil, all the oil in their states, whether on water or on ground, should be considered and that makes getting an answer to who owns the oil more difficult to answer.

    One interesting ring around the oil debate is that leaders of oil communities believe it is wrong for the derivation fund to be paid to state governments. They believe that the money belongs to the oil-bearing communities. What this means is that they do not see the oil in their land as belonging to their states. Their unambiguous position is that the oil belongs to the communities, which bear the environmental side effects and so should get the money. This means states should not claim ownership of oil but communities and ethnic nationalities.

    At a point, Leaders of the oil communities in Niger Delta, under the aegis of Oil and Gas Producing Communities of Nigeria, sent delegations to the Presidency, National Assembly, Revenue Mobilisation, Fiscal and Allocation Commission (RMFAC) and other government agencies. Their mission: campaigning for direct payment of 13 per cent derivation fund to host communities. This development did not go down well with governors. But these leaders argued that it was unconstitutional giving the money to governors, who they accused of misappropriating N7.282 trillion in 13 years. Southsouth leader Chief Edwin Clark once declared as illegal the payment of the derivation fund to state governments.

    One interesting claimant to the ownership of the oil is the Federal Government. Starting with the 1979 Constitution, it got full ownership of the Nigerian territory and the right to decide what compensation to pay for land acquisition, which must “be based on the value of the crops on the land at the time of its acquisition, not on the value of the land itself”. This aided the acquisition of land in Ogoniland and other parts of the region for the use of oil giants without consultation, and payment of negligible compensation.

    The oil debate is also behind the threat by the umbrella body of all youths of Ijaw descent, the Ijaw Youth Council (IYC) Worldwide that unless the ownership structure of oil blocs in the region was rearranged to ensure fairness, attacks on oil platforms would continue. Its embattled president, Udengs Eradiri, told reporters at the Ijaw House, Yenagoa, that the unfair distribution of oil wells was a major cause of the instability in the region.

    Eradiri said: “One of the most salient issues that if not addressed will lead to more crisis is the issue of the oil blocs. President Buhari was one time Petroleum Minister and Head of State in this country. Let us go and do an assessment of that time. The time when criminally they shared our oil blocs was under his watch either as Petroleum Minister or as Head of State. It is in one of those times.

    “Oil blocs were shared to one group. Look at it, either the person (owner of oil bloc) was a former military president or relative of the military president or an in-law to a military president.”

  • A two-million-barrels-of-oil-a-day question

    A two-million-barrels-of-oil-a-day question

    I am not a conspiracy theory buff, but the more I think about the recent return of militancy in the Delta region with so much vengeance, the more I wonder if there isn’t something to the theory of a grand plan somewhere to dismember Nigeria as Africa’s most populous country and its biggest economy.

    The regular reader of this column may recall that about five and a half years ago, on December 11, 2011 to be precise, I expressed concern on these pages about what I said was the dangerous way President Goodluck Jonathan’s administration was playing politics with the Boko Haram insurgency, instead of sincerely trying to defeat it.

    I pointed out how on more than one occasion some well-known Christian leaders in the corridors of power secured the release of Muhammad Yusuf, the founder of the sect, from detention. I also pointed out the incongruity of President Goodluck Jonathan appointing a sister-in-law of Alhaji Modu Sherif as a minister, very much against strong opposition from the Borno State chapter of his own ruling party, the Peoples Democratic Party (PDP). This was at a time the two-time senator, governor and chieftain of the leading opposition All Nigeria Peoples Party (ANPP) was being fingered as the principal financier of the sect, at least in its early stage.

    These and other reasons led to popular speculations that the President and some of his confederates were complicit, if not willing players, in a grand conspiracy to dismember the country if they cannot remain in power.

    Among the propounders of this theory was one, Gordon Duff, a senior editor at Veterans Today and a self-proclaimed security expert on Nigeria with “close personal friends at the highest levels of government.” In an article in the magazine’s edition of November 14, 2011, he claimed Nigeria was being targeted for destruction by America because it was generally proving insufficiently pliant to Western designs on Africa’s natural resources, oil especially.

    “Nigeria,” he said, “is Africa, the most populace country, the most oil and gas wealth, the greatest economic potential, the biggest potential market. Thus, Nigeria is a target.”

    Christian Nigeria, he claimed, “is being set up, not just to fight a ‘terror group’ in the North, but to take on all of Islamic Africa, to draw them into a war that will bring more players, America, for one, into another endless cesspool.”

    It was, he said, a reflection of government’s unseriousness about its war against Boko Haram that it was paying some so-called security experts “for Rolls Royce but (getting) a VW Beatle instead!!”

    It is easy to dismiss Duff’s theory as fanciful. But as I said in my column in question, anyone inclined to do so should first consider three things at least.

    First, was an article in the New Nigerian of January 20, 2003 by its first expatriate managing director, Mr. Charles Sharp, titled “The story that got away.” I have had occasions to refer to that article  on these pages, but it bears repeating as a bit of history with lessons for us as a nation.

    In that article, Sharp revealed how the fabrication of news by the American CIA station chief in Kaduna in the 60s to the effect that the Igbo were killing the Hausa in Eastern Nigeria during the tense period that followed the Northern counter-coup of 1967 in reply to the Igbo coup of 1966, fueled riots against the Igbo in the North, which eventually led to our civil war. Sharp said he got to know the news was a CIA fabrication for sure because its author, John Thorpe, with whom he had been acquainted in his days at the New Nigerian, told him so. Sharp, who was British, had gone on a business trip to America as publisher in 1978 and had taken time off to his visit friend, then in retirement in Florida.

    “The man who created and used his skill and professional expertise to spread the rumour,” Sharp said, “told me so. ‘It was fiction, put out by us, nothing more.’”

    Sharp said to prove how accomplished his friend was at his job as a spook, he played back a tape for him in which he heard his own voice clearly speaking on the telephone to the late Alhaji Babatunde Jose, then executive chairman of Daily Times, on how he (Jose) intended to respond to the orders he had received from the military authorities in Lagos, then the nation’s capital, that his newspaper should not publish stories about the Igbo massacre out of fear that it could escalate tension. Jose had told him he had received the same orders as a result of which, he said, he had had to pulp 50,000 copies of the Sunday Times which had carried the “offending” story. Part of his job, Sharp said Thorne told him, was to bug the telephones of important figures in the country.

    Second, there was this piece titled “Is Nigeria the Next Iraq?” in the February 2007 edition of Vanity Fair, the glossy American lifestyle magazine, in which its contributing editor, Sebastian Junger, revealed how a group of “high ranking” American government officials met in the ballroom of the five-star Four Seasons Hotel in Washington DC, on October 23, 2003, to respond to a simulated crisis in oil supply to the global market from Africa.

    The gathering was presented with a scenario in which Boko Haram had infiltrated the Niger Delta with intent to disrupt Nigeria’s oil supply and the Nigerian military had failed to stop the sect. The group’s response was predictable; find ways to send in the boys to secure the Delta region even if it meant carving it out of Nigeria.

    Third, consider a 28-page bi-partisan report by the US Congress committee on Homeland Security and Counter-terrorism, which received wide publicity in our newspapers in December 2011. The report fingered Boko Haram as a potential danger to America’s access to the country’s oil and claimed that its members had sneaked into the Delta.  It noted that whereas the region’s militias had been “hesitant to inflict truly crippling damage against these facilities because they have some economic stake in them, Boko Haram, which is believed to have no financial interest in the plants, has no such reservations.”

    What is obvious from all this is that America, and by extension, the West, considers Nigeria’s oil of strategic interest and will do anything to secure it. The recent resurgence of homegrown militancy in the oil-producing region, however, shows the Americans grossly miscalculated in their assessment of the source of the threat to the continued free flow of the commodity. Instead of Boko Haram the Niger Delta militants in new guises, but notably as Niger Delta Avengers, have since turned out to be the problem. For, if during the tenure of their own Jonathan they were hesitant to seriously disrupt oil production mostly because they were too busy stealing it, it is now obvious that they no longer have any reservations.

    And what has removed those reservations is not only the defeat of their son at the polls over a year ago, something they never thought could happen and which, in any case, they did everything in and out of the books to avoid. Even more important than their son’s defeat it is apparent that they are greatly angered by the ongoing investigations and prosecutions of some of his confederates for their incredible alleged grand larceny under his watch in at least the last five years.

    One of the theories about this renewed militancy sees the targets of these investigations and prosecutions, notably former Minister of Petroleum, Mrs. Dizeani Alison-Madueke and former militant-in-chief, Government Ekpemupolo, aka Tompolo, and possibly even the former president himself, as its driving force. As conspiracy theories go, this one sounds as popular as it seems credible, considering the militants’ insistence that President Muhammadu Buhari must stop his war on corruption if he wants peace in the Delta.

    The two-million-barrels-of-oil-a-day questions are: would the President give in and if he doesn’t, as he is unlikely to, would the Americans and their Western allies feel obliged to carve out the Delta region just to secure the country’s oil?

  • OPEC urges Nigeria to sustain ongoing energy reforms

    OPEC urges Nigeria to sustain ongoing energy reforms

    The Organisation of Petroleum Exporting Countries (OPEC) has urged Nigeria to sustain its ongoing energy reforms in order to succeed in transforming the country.

    The Secretary General of OPEC, Dr Mohammed Barkindo, stated this in Abuja on Tuesday while addressing State House correspondents, after a closed door meeting with President Muhammadu Buhari, at the Presidential Villa.

    According to him, there is no alternative to the ongoing reforms in the Oil, Gas and Power sectors, saying that the reform must be sustained by ensuring continuity in policy implementation.

    “At home here, the reforms that have been embarked upon in the oil and gas and power sectors, ‎as I told Mr President a short while ago there is no alternative to these reforms.

    “Therefore, what we need to do is to collectively ensure that these reforms are sustained.

    “The bane in the past has been lack of continuity of policies and programmes.

    “Energy reforms the world over normally take some time to reach their targets.

    “So, I think we have taken the right steps here.

    “And what we need, is to continue and sustain these reforms so that the entire energy ‎scene will be totally reformed at the end of the day in the interest of the country and the international community.’’

    Barkindo enjoined member countries of OPEC to remain united to enable them confront the challenges facing the energy sector worldwide.

    He, however, expressed optimism that tremendous efforts were being made by member countries to overcome the challenges.

    “Now, these structural changes swept across the entire industry, member countries of OPEC will have to remain united to confront these challenges.

    “Every member country of OPEC has a variety of challenges both within the industry and the economy at last.

    “But tremendous efforts are being made by member countries to overcome the challenges.

    “But at the organisational level we will need more unity of ministers and governments, as well as our governors and our national representatives, so that together OPEC will be able to overcome these challenges and become even stronger.’’

    On Niger Delta crisis, Barkindo commended the Federal Government for resolving the problem through negotiations and dialogue.

    “We are beginning to see positive results.

    “So, I don’t think it will be proper to pre-empt these discussions that are being handled by Dr Ibe Kachukwu.

    “But, I remain confident that through these negotiations, stable and permanent solutions to this problem will be found because the Niger Delta region is a very important part of our country.

    “And whatever we can do to address the challenges of development, I think is the way forward.

    “I have been told that production is beginning to rise again.

    “So, for us in OPEC, this is the first thing we look at: how much is a member country producing.

    “When we saw that production was falling in Nigeria as a result of the recent challenges, the international community, the market also took note of that.

    “But now I think things are beginning to come back to normalcy and I have seen some of your reports that are also very positive.’’

     

  • ‘Why $200b oil, gas markets remain untapped’

    ‘Why $200b oil, gas markets remain untapped’

    An estimated $200 billion oil, gas and power markets are yet to be tapped in Nigeria and other countries in West Africa due to problems, such as poor financing and lack of capacity building, the Managing Director, Lagos Deep Offshore Logistics base (LADOL), Dr. Amy Jadesinmi has said.

    She said lack of funds and manpower have crippled activities in the energy and allied sectors in West Africa, urging stakeholders to proffer solutions to the problem.

    Jadesimi in her presentation at the Global Green Growth Forum (3GF) in Copenhagen, Denmark, a copy of which was obtained by The Nation, said happenings in the energy services industry are having spiral effects on other sectors in the region.

    She said once investors in the oil and gas sectors are able to provide enough capital and manpower, they would find it easier to service the $200 billion market in West Africa.

    Jadesimi said: “International banks and investors should collaborate if they really want to tap into the investment opportunities in the region. When this happens, the issue of under-utilisation of potentials in the oil and gas and power sector would be a thing of the past.

    “New businesses are going to be generated in the power, oil and gas sector.  Regarded as areas that are critical to the growth of any economy globally, oil, gas and power industries would not only record growth, but would help in moving any economy forward.”

    LADOL, she noted, has keyed into the sustainable development goals (SDGs) mantra by planning to provide over 50,000 jobs through its investment in oil and gas sector.

    She said LADOL has built a fabrication yard that would help in providing services for the Floating Production, Storage and Offloading (FPSO) vessels and other projects in its base, adding that the yard has assisted in training people for the oil sector.

    She advised owners of Small and Medium Enterprises (SMEs) and other companies in high growth markets to play their part by attracting investments into the region.

    According to her, companies need to empower people in the communities, where they are operating, if they really want to provide  necessary changes.

  • Oil prices rise over Nigeria’s supply crisis

    Oil prices rise over Nigeria’s supply crisis

    Oil prices climbed to fresh peaks for 2016 for the third day in a row yesterday due to supply disruptions in Nigeria and data showing lower (United States) US petroleum inventories.

    The Niger Delta Avengers, a rebel group that has attacked numerous oil facilities in Nigeria, rejected a truce offer with officials and claimed they hit a new target.

    The disruptions have slashed output in OPEC member Nigeria from 2.2 million barrels a day to 1.6 million barrels a day.

    US benchmark West Texas Intermediate for July delivery advanced 87 cents to US$51.23 a barrel on the New York Mercantile Exchange. Brent North Sea oil for August delivery gained US$1.07 to US$52.51 a barrel in London.

    US inventory data on Wednesday confirmed a tightening market picture, with US commercial stocks dropping by 3.2 million barrels for the week ending Jun 3, according to the Department of Energy.

  • Fed Govt loses N1.3b daily to Avengers’ attacks on oil facilities

    Fed Govt loses N1.3b daily to Avengers’ attacks on oil facilities

    Sustained attacks on pipelines by Niger Delta Avengers (NDA) have led to the daily loss of 140,000 barrels of crude from oil fields operated in Bayelsa State by Nigerian Agip Oil Company (NAOC) and Aiteo Oil, it was learnt yesterday.

    Using $48 per barrel price benchmark, the two oil firms are losing an estimated $6.72m (about N1.3 billion).

    Eni, an Italian energy firm and parent company of Agip, said the oil firm’s production had been cut by 65,000 barrels per day following last Friday’s attack on its pipeline in Bayelsa.

    Previous attacks in Agip oilfield on May 18 and May 24 were said to have resulted in a shutdown of some 5,200 barrels of the company’s equity share of oil output.

    A company source, who pleaded for anonymity,  confirmed the development yesterday.

    The source said: “The total deferred production due to the attack is 65,000 barrels of oil equivalent daily. There is no further impact on production, since all production from the swamp area has already been stopped days ago.”

    Spokesman of Aiteo – operator of the Nembe Creek trunkline –  which was attacked on May 28,  Mr. Shola Omole, said the line which conveys crude to Bonny export terminal had been shut.

    Omole said some 75,000 barrels daily production had been deferred as the line remained out of service following the attack on the facility.

    Figures from Shell Petroleum Development Company (SPDC) could not be obtained, but the Dutch oil firm has placed its oil exports from Bonny export terminal under force majeure.

    Force Majeure is a legal clause that frees a company from liabilities arising from its inability to meet contractual obligations due to reasons beyond its control.

    SPDC in 2014, sold the 100-kilometre Nembe Creek trunkline to Aiteo, but still relies on the line to lift crude produced from onshore oilfields in Bayelsa to the Bonny terminal in Rivers State.

    The Minister of State for Petroleum Resources, Mr. Ibe Kachikwu, was quoted as saying that Nigeria was producing 1.6 million barrels per day, excluding further production outages due to attack on Agip, Chevron and Shell at the weekend.

    The development will likely affect the implementation of the N6.07 trillion 2016 budget premised on a daily crude oil production of 2.2 million barrels.

    The Niger Delta Avengers, the group which has claimed responsibility for most of the attacks, has rejected dialogue with the Federal Government, demanding instead a Niger Delta Republic.

    But the Federal Government, which has delpoyed troops in the creeks has vowed to deal with the militants. It has deployed attack aircraft, and naval war boats in the region.

  • Oil chief backs PIB’s unbundling

    Oil chief backs PIB’s unbundling

    An oil firm’s chief executive, Emeka Eneh, has lent his support to the unbundling of the petroleum industry sector through the passage of the Petroleum Industry Bill (PIB).

    Eneh, who is  Oildata Group Executive Officer and former President, Society of Petroleum Engineers (SPE) , said  the suspension of public hearing on the bill by the Senate, is to make the PIB robust and encompassing to benefit all stakeholders. With the suspension, more talks would be held on it before hearing resumes, and I believe it will come  out a better Act and more beneficial.

    He said the suspension of the hearing on the PIB does not mean that the lawmakers do not have zeal to pass the bill, stressing that the PIB is necessary and everybody recognises it. “What is happening is that democracy works when there is communication. Senate stepped it down for people to do a little bit more of talking on it. I think there is greater alignment across the industry today for the fact that PIB wouldn’t be considered as one omnibus bill, but taken into realistic chunks that will allow it to move forward. I think there is a consensus for people to move forward.

    “This is important because we have to appreciate that today, we are dealing with oil prices at $40 per barrel compared to $100 per barrel a few years ago. So the reality of today is now dawning on people. Therefore, in looking at the PIB, you have to look at it vis-à-vis the current realities and I think that is the cause of the delay in passage of the bill.”

    On low oil price, low production and renewed hostilities in the Niger Delta region, Eneh urged the government to diversify the productive sectors of the economy, engage in aggressive exploration for discovery of new oil fields and seek ways to develop the region, saying the impact of low oil price is being felt so much by Nigeria because of its over-dependence on oil revenues. He said if the activities of people in various sectors are well coordinated, revenues from non-oil activities would be able to sustain the nation.

    “If the activities of people and cluster development are coordinated, the country will certainly move away from over-dependence on oil revenues. Manufacturing, agriculture and trade constitute over 60 per cent of our GDP. We can leverage expertise in the oil industry to be able to push through regional development, industrial parks and free trade zones developments that are emerging across the country in a coordinated manner.

    He said within the oil industry, secondary processing is important, stating that the Niger Delta energy corridor is a concept that is targeted to transform the Niger Delta into a secondary processing zone, where oil is not simply extracted and evacuated from the country, but that it should go through levels of processing.

    The energy corridor will capture over 40 per cent of crude oil value locally. When this project is actualised, the militancy in the Niger Delta will drastically reduce, he said.

    “The oil exploration has to be continuous because we are taking something out of the ground without replacing it. Therefore, the day we start to cut down exploration is the day our reserves will be limited and at some time, we will start to have a decline in our production. If that decline is not today, it will come in future, he said, adding that this is the best time to do exploration.  When the oil price is low and prices of services are low. Therefore, this is the time to encourage exploration.

  • Oil chief backs planned unbundling of PIB

    Oil chief backs planned unbundling of PIB

    Should the National Assembly unbundle the Petroleum Industry Bill (PIB)? Yes, says an oil chief, Emeka Eneh, who described the planned unbundling of the bill as welcome and in the interest of players in the industry.

    Eneh, Oildata Group Executive Officer and former Society of Petroleum Engineers (SPE) president told The Nation.

    “The suspension of public hearing on the bill by the Senate is to make the bill robust and encompassing to benefit all stakeholders. With the suspension, more talks will be held on it before hearing resumes, and I believe it will come  out a better Act and more beneficial.

    Ene went on: “Suspension of hearing on the PIB doesn’t really mean the lawmakers don’t have zeal to pass the bill. PIB is necessary and everybody recognises it. What is happening is that democracy works when there is communication. Senate stepped it down for people to do a little bit more of talking on it. I think there is greater alignment across the industry today for the fact that PIB wouldn’t be considered as one omnibus bill but taken into realistic chunks that will allow it to move forward. I think there is a consensus for people to move forward.

    “This is important because we have to appreciate that today we are dealing with oil prices at $40 per barrel compared to $100 per barrel a few years ago. So the realities of today are now dawning on people. “Therefore, in looking at the PIB, you have to look at it vis-à-vis current realities and I think that is the cause of the delay in passage of the bill.”

    On low oil price, low production and renewed hostilities in the Niger Delta region, Eneh advised the government to diversify, engage in aggressive exploration for discovery of new oil fields and ways to develop the region.

    According to him, the impact of low oil price is being felt so much by Nigeria because of its over-dependence on oil revenues for survival. He said if the activities of people in various sectors are well coordinated, revenues from non-oil activities would be able to sustain the nation.

    “If the activities of people and cluster development are coordinated, the country will certainly move away from over-dependence on oil revenues. Manufacturing, agriculture and trade constitute over 60 per cent of our GDP. We can leverage expertise in the oil industry to be able to push through regional development, industrial parks and free trade zones developments that are emerging across the country in a coordinated manner.

    “Within the oil industry, secondary processing is important. The Niger Delta energy corridor is a concept that is targeted to transform the Niger Delta into a secondary processing zone where oil is not simply extracted and evacuated from the country but it goes through levels of processing. The energy corridor will capture over 40 per cent of crude oil value locally. When this project is actualised, the militancy in the Niger Delta will drastically reduce.

    “The oil industry exploration has to be continuous because we are taking something out of the ground without replacing it. Therefore, the day we start to cut down exploration is the day our reserves will be limited and at some time we will start to have a decline in our production. If that decline is not today, it will come in future.

    “This is the best time to do exploration.  When the oil price is low and prices of services are low. Therefore, this is the time to encourage exploration.

  • Troops take over sites of vandalised pipelines

    Troops of the Nigeria Security and Civil Defence Corps (NSCDC), have taken over the sites of vandalised pipelines in the creeks of Bayelsa State after intensed battle with armed militants.

    The state Commandant, NSCDC, Mr. Desmond Agu, said on Sunday that the crack team from its command warded off the ambush laid by the militants to stop security operatives from getting there.

    He said after hot exchange of gunshots with the militants, the troops cleared the areas to give room for immediate clamping of the damaged pipelines.

    Armed militants had laid ambush after the Sunday’s bombing of pipelines belonging to the Nigerian Agip Oil Company (NAOC) and another oil firm, Aiteo in Nembe and Southern Ijaw local government areas of the state.

    But Agu, who spoke on Sunday said following the superior firearms of troops, the militants fled the scene by navigating the creeks.

    He said the operatives were following some leads to apprehend them.

    “We have secured the crime scene to give room for immediate clamping of the ruptured sections on the pipelines. For the fleeing militants, we will surely get them,” he said.

  • Oil nears $50 on U.S. crude cut, Nigeria, Libya attacks

    Oil prices were up more than one percent yesterday with market bulls targeting $50 a barrel and beyond on expectations the United States (U.S.) government will report a large crude stockpiles drawdown for last week.

    Besides, there has been a spate of violent attacks against the Libyan and Nigerian energy industries which have global crude flows.

    The shortfall has accelerated the recovery in oil prices, which are up nearly 90 per cent from winter lows of around $27 for Brent crude and about $26 for the U.S. West Texas Intermediate.

    Earlier in the week, he American Petroleum Institute (API), a trade group, said  U.S. crude inventories fell by 5.1 million barrels in the week to May 20, twice what analysts expected.

    The U.S. Energy Information Administration (EIA) said it would issue an official stockpiles data later yesterday.

    Wildfires in Canada’s oil sands region as well as a near economic meltdown in Organisation of Petroleum Exporting Countries (OPEC) member Venezuela cut nearly four million barrels per day in global crude flows.

    “We look for new highs … in carrying this advance higher to around the $52-52.50 area before this spring advance fully plays out,” said Jim Ritterbusch of Chicago-based oil markets consultancy Ritterbusch & Co.