The Nation Newspaper

Tag: Oil

  • Let the oil flow

    Let the oil flow

    With NNPCL supplying crude oil to Dangote Refinery, fuel stations’ gridlock should come to an end

    Nigerians entered last weekend with both a sense of puzzle and suffering over the prospect of fuel supply and how much to obtain it. A series of events in that aspect of Nigerian life has been giddy, at once frightening and paralysing.

    It began with the admission by the oil giant, Nigerian National Petroleum Company Limited (NNPCL) that it was in a quandary on how to supply fuel to the Nigerian market because it has been carrying the load of the Nigerian economy, making it indebted to the tune of $6 billion.

    Not long after that, the announcement was cheering that Dangote Refinery (DR) will now stock the various depots with fuel, easing the burden on Nigerians and lightening the foreign exchange challenges.

    The NNPCL reflected one of the high virtues of corporate integrity by its confession. It shows that it has been an unthanked and uncongratulated buoy and helper of subsidy, paying it on behalf of the Federal Government. Yet, the company is a private concern and is being tasked to serve as the burden carrier of not only the government but also the country.

    Its ability to let the world know it has been our yoke bearer also raises a question about its framework to serve as a real company. It is therefore high time that the company be made to operate as a company that bears its own burden, even if it is connected with easing the pains of the oil market.

    However, the revelation explained why we have had in the past few weeks long lines at fuel stations. Commuters and car owners became like Samuel Beckett’s characters in his famous play who are waiting eternally for Godot. Fuel became, for many, a pie in the sky.

    When DR announced it was ready to supply, the relief and joy was palpable. But the company did not turn words into fuel as the queues remained and elongated with punishing consequences, not only for the individuals but also for the economy at large.

    This necessitated President Bola Tinubu, from faraway China, to direct the vice president, Kashim Shettima, to summon a meeting of top government officials and industry stakeholders, including the Minister of State for

    Petroleum Resources, Heineken Lokpobiri, National Security Adviser Nuhu Ribadu and the chief executive of NNPCL, Mele Kyari.

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    Oil minister Lokpobiri assured Nigerians that the availability of fuel will return to the oil stations in short order. This inevitably calls for patience in a long-suffering market. But the other issue is pricing, but before discussing it Nigerians have been told that it has to figure in the cost. Or else, it would return the country to the problem that led NNPCL to its huge indebtedness.

    The NNPCL has long told Nigerians that it was not selling fuel at its landing cost. It was even selling it at about half the landing cost. The company was paying the balance from its own purse. That business model is not sustainable. Its purse string could not be elastic forever.

    Hence the pass we have found ourselves today. It shows that we have to confront the problem in the economy. If oil is going to save us, we have to be transparent about it. How much fuel do we have, and how can we sustain making and selling it without enacting another stalemate?

    Hence the coming of DR will reveal a lot of things. First, DR is a private concern and its primary aim is profit. If the Federal Government can put a burden on NNPCL because it is a huge stakeholder in the company, the same cannot apply to DR.

    The NNPCL outcry will therefore apply in the distribution of DR fuel. Alhaji Aliko Dangote, chairman/CEO of the Dangote Group, has said that the distribution of the fuel will be executed by NNPCL but we now know that NNPCL will not be the off-taker.  One principal factor here is explained by Adedapo Segun, executive vice president, downstream, of the NNPCL. He said that the distribution must conform to the Petroleum Industry Act (PIA) that compels pricing to be deregulated. In order words, it will follow market forces.

    Now, once DR takes off, it will determine the price. It will no longer be the responsibility of the NNPCL but Dangote and other private refineries will make their costs and fix their own prices.

    Hence, Lokpobiri said that prices will be uneven in different parts of the country before it can find its level. This is a tricky part. Dangote does not have to meet with the NNPCL top brass to know how much it costs to make a litre of fuel and what will make sense to sell it at.

    At stake here is not just the profit of the DR, but for the distributors.

    Deregulation does not and should not mean chaos. There must be order and regularity in spite of the worship of market forces. This calls for a deliberate thinking by both government and other stakeholders before the prices are determined. If Dangote and others fix their prices, it will not be the onus of the Federal Government to justify it. Yet, we must be wary of price gouging. Fuel prices will no longer be cheap, but it is no licence for profiteering. That is the aspect where regulation comes in.

    We welcome the coming of DR because it takes away great burden from the NNPCL and, especially from the nation’s foreign exchange stock. We have been spending over the years close to 40 percent of our foreign exchange earnings on importing fuel.

    But the other reality is the huge burden it will bring to the citizens because of its implication for inflation and cost of living, even before the President’s Eagle Square declaration that “subsidy is gone.” In the past few weeks, the fuel stations have been raising their prices, and this means the about N600 per litre price was, high as it was, arbitrary and did not reflect the real value of the cost. In some parts, it is selling over N800 per litre and others over N1,000 per litre. It is chilly comfort to tell our fellow citizens that it will be made available soon. We hanker after that hour. But that will be the beginning of sorrows. The hobgoblin of inflation will come with its fangs. Now that NNPCL can no longer play father Christmas or else it will go under, Nigerians will be coming to terms, in a bitter way, with the harsh reality of an unsubsidised lifestyle.

    The irony is that the poor and vulnerable Nigerians did not really enjoy a lot when it was subsidised. Now they will suffer more because of the official larceny and profligacy of a few. It is not time to muse over what might have been. That is, if we had followed the model of diesel deregulation in the past, things might have eased itself over time. With PMS regulation, we were only postponing the evil. That day seems to have come.

    In a country that has, in the past year, been grappling with the bequeathal of 97 percent debt and about N30 trillion in ways and means obligation, the future has come, and it is not kind.

    But this calls for imaginative leadership. The people cannot be allowed to groan. We therefore welcome efforts to start the Compressed Natural Gas (CNG) buses. NNPCL has assured Nigerians that it is ramping it up with gears and accessible stations, and it should be a matter of emergency. It will cost far less than premium motor spirit (PMS). We also know that diesel has been deregulated for long, and most high-powered vehicles, including mass transit, are immune to the PMS price rise. That makes us wonder why it should raise prices of transportation. The smaller buses that use PMS should be prioritised for CNG.

    We also want the Federal Government to expedite importation of food to ease food inflation. We acknowledge the credit programme for traders and the scholarship schemes, which will ease education problems.

    The Federal Government should also monitor its distribution of food to the poor. It is unfortunate that politicians have resorted to a cynical acquisition of these palliatives for selfish purposes by hoarding them for their favourites. Some governors are guilty of this as well.

    We now know that we cannot borrow into prosperity. We have to become a productive society, and our political elite must abandon official permissiveness and lead by example.

    But first, the Federal Government should stop the gridlock at fuel stations and let the fuel flow.

  • Fed Govt sets up committee to resolve oil supply to refineries

    Fed Govt sets up committee to resolve oil supply to refineries

    The Federal Government yesterday raised a committee on the resolution of pending issues hindering Oil Producers Trade Section (OPTS) and the Independent Petroleum Producers Group (IPPG) from supplying crude oil to local refineries such as Dangote Refinery and others.

    After a meeting with the groups in Abuja, Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobri, said the committee which is headed by the Permanent Secretary Ambassador Nicholas Ela, is expected to submit its report on Tuesday.

    He said the meeting with the OPTS and IPPG resolved most of the grey areas that emanated from the misunderstanding of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) policy on Crude Oil Supply Obligation implementation.

    The policy is enshrined in section 109(2) of the Petroleum Industry Act (PIA).

    He said: “The reason why we are gathered here today: we feel we should discuss a very important issue in the oil industry. There seems to be some misunderstanding of regulation made by NUPRC.

    “That has to do with domestic crude oil supply obligation by oil companies. And as part of our policy here in the ministry that whenever there is a seeming misunderstanding we bring parties together with a view to resolving whatever misunderstanding parties will have.

    “And that is why we are gathered here today to discuss on issues raised by both OPTS members, who are the international oil companies and the IPPT members who are the indigenous oil companies.

    “And at the end of the day, we were able to agree except for one or two grey areas. So what we have resolved is that there should be a small committee to be headed by the Permanent Secretary that will look at the matter between Monday and Tuesday and report back to me.”

    Lokpobri said the despite speculations and misunderstanding of the NUPRC policy implementation, the government is committed to supplying crude oil to support domestic refineries.

    He expressed government readiness to create a globally competitive environment that can allow the sector thrive.

    The minister said since the sustainability of the industry growth is the policy trust of the government, he has always brought parties together to resolve nagging issues.

    He said issues that the parties have resolved we’re what people considered irreconcilable in the industry.

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    The minister said the oil firms in the country are committed to the successful implementation of the domestic crude oil obligation policy.

    Lokpobri  said: “We can inform them here that look, contrary to whatever opinion you people may have, one, we are committed to support local refining.

    “We are also committed to ensuring that we create an environment that is globally competitive to allow operations in the oil and gas sector to continue. And that is essence of government.

    “And that is why since we were appointed that has been a major policy trust that wherever there are issues we sit down and resolve the issues. Gentlemen of the press, please report to Nigerians that there is no disagreement. Those issues that people thought were very fundamental issues have all been agreed and all of us are committed, all the companies in Nigeria are committed to ensuring that we meet that part of the PIA that has to do with domestic crude oil supply obligation.”

    Those that attended the meeting were Green Energy International Limited, Chief Executive Officer, Prof. Anthony Adegulugbe; Seplat Energy Plc, Mr. Roger Brown; AA Holdings & EVC Platform Petroleum, Chairman, Mr. Austin Avuru; IPPG Secretariat, Executive Coordinator, Oyeleke Banmeke and others.

  • Africa’s oil, gas projects face declining funding

    Africa’s oil, gas projects face declining funding

    Several banks and financial institutions implementing policies aimed at reducing support for fossil fuel projects have led to a sharp decline in investment in Africa’s oil and gas industry, a sector that is crucial for its economic future and energy needs.

    In a report, the African Energy Chamber (AEC) stated that these institutions were practicing “financial apartheid,” because while similar projects receive support in Europe, Africa’s high-cost energy projects are being neglected.

    Executive Chairman, African Energy Chamber (AEC), NJ Ayuk, said the decline in investment is already having a noticeable impact, exacerbated by global shifts towards cleaner energy and prioritizing of ESG practices. Major international oil companies are reducing their presence in Africa.

    For instance, Equinor has withdrawn from offshore exploration in South Africa and ExxonMobil has exited a deep-water oil prospect in Ghana. This decline is contributing to a bleak outlook for Africa’s energy sector.

     “As the international community moves to boycott investments in the African energy sector, African people and African development stand to suffer. The role of oil in Africa’s energy and economic future is apparent, and consequently, should be defended as Western elites move to disrupt African progress,” Ayuk said.

    The broader implications of financial divestment are profound. Many African governments rely on fossil fuels as a cost-effective means to alleviate energy poverty and boost state revenues. However, the increasing pressure on financial institutions to cut funding for high-carbon projects creates uncertainty about the future of Africa’s energy sector.

    The International Energy Agency (IEA) has added to these challenges with its calls to cease funding for oil and gas projects, highlighting a disparity: while natural gas is considered a ‘green’ energy source for Europe, it does not receive the same treatment in Africa.

    According to Ayuk, “The IEA has lost its relevance and its authority.” Originally focused on managing oil supply disruptions, the IEA now prioritizes policies aimed at achieving net-zero emissions by 2050. Its 2019 projection that no new investments in oil, gas, or coal are needed if the world continues on this path has been particularly controversial.

    Several key African projects are at risk due to the withdrawal of financial support. Significant initiatives like TotalEnergies’ Mozambique LNG project, ExxonMobil’s Rovuma LNG project, Nigeria’s Train 7 LNG expansion, Senegal’s Sangomar oil field, Uganda’s Tilenga project and the East African Crude Oil Pipeline (EACOP) require substantial financing to advance.

    Despite these setbacks, some projects are progressing. TotalEnergies is advancing its $20 billion Mozambique LNG project, aiming to develop the Golfinho and Atum fields with a production capacity of 12.88 million tonnes per year. Eni’s Coral South FLNG project in Mozambique has achieved a production capacity of 3.4 million tonnes per year. Additionally, the Greater Tortue Ahmeyim (GTA) LNG project, which started gas production in November 2022, is being developed by bp, Kosmos Energy and the national oil companies of Senegal and Mauritania. This project includes an FLNG facility with an initial capacity of 2.5 million tonnes per year.

    Meanwhile Nigeria’s Train 7 project, an expansion of the existing NLNG facility on Bonny Island, aims to boost production by 8 million tonnes per year, bringing the total to about 30 million tonnes per year. This development is crucial for Nigeria’s growing population and its ability to meet its energy needs.

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    However, delays persist. The Tanzania LNG project, involving Equinor and Shell, is stalled due to proposed government changes. UTM Offshore’s FLNG project in Nigeria, initially planned for 2023, has been postponed. Additionally, the EACOP faces significant criticism from financiers and environmental groups, complicating its development and financing.

    Namibia, experiencing heightened interest from recent oil discoveries, is facing delays with the Kudu Conventional Gas Development. The Kudu Gas Project, an offshore initiative, has faced setbacks related to financing and project development challenges. As a result, the project is still pending FID and anticipated to commence production by 2026.

    “Today, African Energy Poverty numbers are skyrocketing. Nine hundred million Africans lack access to clean cooking technologies, while 600 million lack access to electricity, most of them women. African families are facing high energy cost and inflation is going up,” Ayuk emphasizes. “It is shocking that financial institutions that do business in Africa continue to practice financial apartheid by cutting off capital and financing to oil and gas companies operating in Africa because of climate concerns. These same institutions fund gas development in Europe, where natural gas is deemed green and a fossil fuel for Africans.”

    The disparity in financing not only undermines Africa’s ability to harness its natural resources for its development but also perpetuates a cycle of energy deprivation. The AEC urges a re-evaluation of this approach and calls on global financiers to support Africa’s energy projects, recognizing their critical role in advancing economic development, enhancing energy security, and improving living standards across the continent.

  • Oil price rebounds on geopolitics risks

    Oil price rebounds on geopolitics risks

    Oil prices settled higher at the weekend and notched over 3.5 per cent, while WTI rose more than four per cent in weekly gains as positive economic data and signals from policymakers that they could cut interest rates as early as September eased demand concerns, while fears of a widening Middle East conflict continue to raise supply risks.

    Recovering from last week’s giant stock selloff, oil prices are set for a much-needed weekly gain after four straight week-over-week losses. Brent crude futures settled 50 cents up, or 0.6 per cent, at $79.66 a barrel, while the West Texas Intermediate (WTI) crude futures rose 65 cents or 0.9 per cent to $76.84.

    “Crude is in a recovery mode … as geopolitical tensions still seem to be a positive factor, and on-again off-again recession fears have calmed a bit, at least for now,” said Dennis Kissler, senior vice president of trading at BOK Financial.

    Fears of an impending economic recession were alleviated by stronger US jobs data and with markets closely following Iran’s retaliation vis-a-vis Israel, geopolitics have added some bullish impetus, too.

    As at close of last week, crude oil prices rebounded sharply from their recent lows, driven by a potent mix of geopolitical risks, tightening supply and improving economic indicators. Both Brent and WTI benchmarks recorded gains for three consecutive sessions, marking a significant turnaround from last Monday’s eight-month lows.

    The specter of escalating conflict in the Middle East emerged as a primary catalyst for oil’s upward movement. The recent assassinations of senior Hamas and Hezbollah members have heightened fears of Iranian retaliation against Israel. This tension raises the possibility of supply disruptions from the world’s most critical oil-producing region. The market remains on edge, with traders closely monitoring developments that could potentially spark a wider regional conflict.

    Compounding supply worries, Libya’s National Oil Corporation declared force majeure at its Sharara oilfield due to protests. This unexpected disruption removes a significant amount of oil from the market, with Sharara’s capacity of 300,000 barrels per day now offline. The reduction in Libyan output further tightens global supply, providing additional support to prices.

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    A trio of Federal Reserve policymakers indicated that they were more confident that inflation is cooling enough to cut rates. A bigger-than-expected fall in U.S. jobless claims data also helped to underpin the recovery.

    Also offering support was China’s consumer price index, which rose last month at a slightly faster than expected rate, statistics bureau data showed.

    “Positive momentum was further reinforced by Chinese inflation numbers that exceeded expectations. In this context, it wouldn’t be surprising to see the price per barrel testing the $80 level,” said Pierre Veyret, Technical Analyst at ActivTrades.

    Some protesters say they are even ready to physically stop machinery to prevent the mine’s construction. “The price per barrel has benefited from rising geopolitical tensions in the Middle East, which have fuelled fears of a potential conflict that could disrupt the region’s output and reduce the global supply of crude,” Veyret added.

    The killing last week of senior members of militant groups Hamas and Hezbollah had raised the possibility of retaliatory strikes by Iran against Israel, stoking concerns over oil supply from the world’s largest producing region.

    Iran-aligned Houthi militants have also continued attacks on international shipping near Yemen in solidarity with Palestinians in the war between Israel and Hamas.

    Lending further support to prices, Libya’s National Oil Corp declared force majeure at its Sharara oilfield from Wednesday, adding that it had gradually reduced the field’s output because of protests. However, U.S. oil rigs, an indicator of future production, rose by three to 485 this week.

  • Fed Govt, oil first get framework on navigational services

    Fed Govt, oil first get framework on navigational services

    The Federal Government, international oil companies (IOCs), and local oil companies (LOCs), under the aegis of the Oil Producers Trade Section (OPTS), have started the draft of a framework for navigational services.

    The framework is meant to guide navigational services in the country ahead of the resumption of the collection of helicopter landing levy.

    The Federal Government granted Messers NAEBI Dynamic Concept Limited the exclusive rights as the consultant to collect the levies.

    Afterwards, stakeholders expressed reservations about the appropriateness of the levees.

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    Following the concerns the stakeholders raised, Aviation and Aerospace Development Minister Festus Keyamo announced the suspension of the collection of the levy.

    The suspension took effect from May 30.

    The minister thereafter set up a committee with members drawn from the Ministry of Aviation and Aerospace Development and its relevant agencies, Airline Operators of Nigeria (AON), International Oil Companies (IOCs) and Messers NAEBI Dynamic Concept Limited.

    Members of the committee were advised to look into the issues raised by concerned stakeholders and submit a report on or before the end of June 2024.

    There are indications that the committee has submitted its report to the Minister.

  • Oil for cash deal

    Oil for cash deal

    •Though it has a point, House of Reps joint committee should exercise restraint over why NNPCL should take action on further deals

    Last week, the House of Representatives Special Joint Committee on Petroleum directed the Nigerian National Petroleum Company Limited (NNPCL) to halt what it called the mortgage of Nigeria’s future crude oil until it concludes its assignment. This is amidst reports that the company was planning to borrow an additional $2bn in crude oil-backed loans from international creditors to boost its financial inflow. One report quoted the Group Chief Executive Officer of NNPCL, Mele Kyari, as saying that the company was already in discussions with international lenders to raise an oil-backed credit facility.

    While urging the NNPCL not to undermine the forensic investigation being conducted by it, the committee warned that the deal, if allowed, would further worsen the situation of things, starve the refineries of feed-stock, weaken revenue generation and create room for waste of future revenue. The committee also fears that the deal will go against the grain of the recent directive by the Federal Government on the need to protect local refineries.

    But given the structure of the company, it is obvious that it is not NNPC per se that needs the money but the federal government. On the surface,  the fears of the committee are not entirely without basis. Indeed, nothing in the committee’s directive could be said to be extraordinary in the current circumstances. This is even more so that the Federal Government had, vide an earlier deal in August 2023, secured, through the same NNPCL, a $3.3bn loan from Afreximbank to boost the nation’s foreign reserves, for which the country is already obligated to supply about 90,000 barrels of daily crude production. When this is added to the signals emanating from the company of its inability to meet the crude requirements of the local refineries, the committee’s fears will certainly be hard to dismiss. Indeed, what the national interest calls for at this time is for the process to be fully audited to ensure that the country gets full value from it.

    But as the president said in his public broadcast, crude outflow in Nigeria has doubled to 1.6. Million barrels per day and that gives the country more leverage for such deals.

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    For, while it is hard to see the broad economic stabilisation measures being undertaken by the Federal Government succeeding without the state oil company being pressed into action as in the present case, that pivotal role itself imposes the additional burden of ensuring – at the very minimum – that the activities it engages in not only align with the demands for utmost transparency but is also perfectly in accord with the strict dictates of the law.

    Asking the company to put a brake on the process until the committee’s investigations are concluded does not appear to us as either an unbridled interference or unreasonable so long as it does not last too long for a country in dire need of cash. If anything, it seems only a part of the inescapable duty of oversight imposed on the legislature by the constitution. Although the initial expectation was that the company would have begun to operate as a limited company governed by the provisions of the Petroleum Industry Act (PIA), still undeniable is that the company has remained an entity in transition. From a board made exclusively of government appointees to the 100 percent ownership of its shares, it could safely be said that little really has changed in the aftermath of the so-called transition.

    The expectation is that the committee will act with speed and thoroughness in the assignment just as we expect that the findings from the investigation will be made public.

    As for the government, now seems the best time ever to kick off the process to ensure the fiscal and operational autonomy of the company as envisaged by the Act. That process, we daresay, shouldn’t take eternity. After all, that transition has long been advertised as holding the key making it a world-class operator which the former corporation is certainly not. 

  • Oil, gas operators push for synergy in regulations

    Oil, gas operators push for synergy in regulations

    Experts and stakeholders in the country’s oil and gas sector have lamented the bottlenecks faced in their quest to comply with regulatory procedures. The stakeholders, who spoke at the just concluded Society of Petroleum Engineers (SPE) Nigerian Council’s 47th Nigeria Annual International Conference & Exhibition (NAICE) in Lagos yesterday, regretted that the regulatory bottlenecks have continued to suffocate the sector while investors are now looking for solace in other countries. To this end, they therefore called on the government to streamline the process for better compliance.

    Leading the charge in was the Managing Director and Chief Executive Officer, Aradel Holdings Plc, Adegbite Falade, who noted that the country’s oil and gas industry is the most regulated in the country, adding that over 40 regulators are currently overseeing the sector.

    Hear him: “Some years ago, we were dealing with about 10 regulators, but today the number of regulators that we are dealing with is not less than 40. We really have to deal with this. We need the regulators but we believe the regulations should be seamless.”

    Besides emphasising the need for regulations to be more digitised in order to ensure ease of getting approvals, he also appealed that the payments to regulators being currently made  in dollars should be reversed. “I would like to appeal to them that we should do our deals in Naira. Let our operators breathe,” Falade said.

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    Although Falade applauded the regulators for the support that indigenous firms have enjoyed from the regulators, he nonetheless observed that “but there is room for improvement,” even as he called for reduction in time frame for securing approvals.

    Speaking in a similar vein, a Principal Consultant / Chief Executive Officer, Reservoir and Facilities Solution Limited, Mrs. Oluseyi Afolabi, said Nigeria must perfect its laws and ensure a seamless regulatory process so that they don’t have to change the rules often.

    She said: “You can’t change the rule in the middle of the game. The oil and gas industry is a long term investment and investors are in business to make profit, we don’t need to discourage them.”

    Likewise, the Executive Director Oando Plc, Ainoje Irune, who was represented by the firm’s General Manager, Subsurface, Babafemi Onasanya, at the event, said financial support has been a major concern for indigenous players, adding that finding a financial partner is very crucial to the growth of local players in Nigeria.

    He advocated for community partnership between the host and oil firms as this will lead to sustainability of business operations and growth of such a host community. This, according to him, would reduce the restiveness in host communities and reduce vandalism which has been a major threat to crude oil production in a long time.

    However, going by the disclosure of some of the regulators, the concerns of operators may be a thing of the past in this regard. At the opening ceremony of the NAICE 2024, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), the Commission Chief Executive, Gbenga Komolafe, an engineer, revealed that it is entrenching collaboration with the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and other key stakeholders to deepen end-to-end value in critical areas of operations within the oil and gas sectors of the economy.

    According to him, NUPRC is confident that the efforts to foster regulatory alignment in this respect will stimulate further activities for domestic energy security in the short term. “We will not rest on our oars!  We are committed to entrenching collaboration for enhanced value to the industry and the nation.”

    According to him, the NUPRC is confident that the efforts to foster regulatory alignment in this respect will stimulate further activities for domestic energy security in the short term. He further emphasised that the optimisation of the midstream and downstream segments is not merely an option but an inevitability.

    “By focusing on these areas, we can mitigate the risks associated with market volatility, enhance our refining capacities, and ensure a more stable and efficient energy security for our nation, in a world undergoing change,” Komolafe submitted.

  • ‘Fed Govt on right path for oil, gas investment’

    ‘Fed Govt on right path for oil, gas investment’

    • To distribute 250,000 cylinders a year over 3 years

    Greater opportunities await prospective investors in the nation’s oil and gas industry, as the Federal Government assured of robust enabling policies that would unlock the huge potentials in the sector.

    The Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri and his counterpart, Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, who both spoke virtually at the ongoing 47th Nigeria Annual International Conference and Exhibition (NAICE) 2024, in Lagos, said the government is on the right path to attracting investments into the nation’s energy industry.

    Lokpobiri said optimisation of midstream and downstream sectors are not just an option but a necessity for enhancing efficiency, ensuring sustainability, and maintaining the nation’s competitive edge in the global market.

    The minister, who was represented virtually by the Permanent Secretary, Ministry of Petroleum Resources, Nicholas Ella, said: “Our nation’s petroleum industry has long been a cornerstone of our economy, contributing significantly to national revenue, job creation, and industrial growth.

    However, the evolving energy landscape presents new challenges and opportunities that require a comprehensive and integrated approach.

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    “Technological advancements, regulatory frameworks, and strategic partnerships are key enablers in driving the transformation of our midstream and downstream sectors. At this juncture, it is imperative that we leverage these advancements to enhance the profitability and environmental performance of our industry. By doing so, we can ensure that our petroleum resources are utilised most efficiently and sustainably,” he said.

    Ambassador Ella was emphatic that the Federal Government is committed to creating an enabling environment for investment and innovation in the midstream and downstream sectors. He disclosed that the government is actively working on policies and initiatives to attract local and international investments, foster technological innovation and ensure regulatory compliance. According to him, one of the ministry’s key focus areas is the development of infrastructure to support the efficient transportation, processing and distribution of petroleum products. This he noted to include the expansion and modernisation of pipelines, storage facilities, and refining capacity to meet both domestic and international demand. Besides, he said the government is also prioritising the adoption of digital technologies and data analytics to improve operational efficiency and decision-making processes in the industry.

    In the same vein, Ekpo re emphasised the strategic position of the country’s petroleum sector, revealing it holds immense resources to transform the economy and generate huge employments. He said the government is determined to increase domestic utilisation of gas, hence it has started to implement its plans to distribute 250,000 cylinders a year for the next three years.

    “We are also absolutely working to reduce the cost of Liquefied Petroleum Gas (LPG) cylinders in the country by supporting the establishment of in-country composite cylinders manufacturing to create additional markets,” he said.

    Ekpo expressed confidence that the presidential executive order would streamline the regulatory process, reduce bureaucratic bottlenecks and provide fiscal incentives that make investments in gas projects more viable.

    “We anticipate that these majors will spur an increase in investment, leading to enhanced gas production, job creation, and economic growth,” he said.

  • Firms partner on oil, gas logistics

    Firms partner on oil, gas logistics

    Nesto Aviation Services , ADAC HEMS Academy Germany and KASI Healthcare Offshore and Aero Medical Unit have signed an agreement to deepen collaboration to facilitate the launch of a regional helicopter ambulance to significantly improve access for  emergency medical care for workers in the oil and gas sector in remote locations in Nigeria, West Africa and other locations in the Gulf of Guinea.

    The partnership will see the three organisations pull their equipment, expertise and other interventions to provide dedicated critical care aircraft for injured personnel within the shortest timeline, which they described as Golden Hour.

    Speaking at the signing of the Memorandum of Understanding in Lagos at the weekend at NESTAV facility at the Lagos Airport, the organisation said besides creating jobs, the partnership will offer training opportunities for indigenous professionals in the aviation, medical and logistic value chain.

    The ground breaking partnership, the organisations said, speed up rescue time for injured personnel in the shortest possible timeline, with transportation alternatives for stroke victims, heart attack patients and others with traumatic injuries and other persons.

    In his remarks, Chairman of NestOil Group, Dr Ernest  Azudialu Obiejesi,  described the partnership as a pathway for the development of  aeromedical capacity across more than 180 remote oiul and gas locations within the Gulf of Guinea.

    He said NestAv has acquired a King Air aircraft equipped with advanced equipment and basic life support and advanced team to drive its ssrvices.

    He said the partnership has secured the endorsement of the Nigerian Civil Aviation Authority , NCAA, the Ministry of Health and other regulatory authorities to change the paradigm in the response timeline for emergencies in far flung remote oil rigs and other platforms.

    He said   .We are the largest indigenous  engineering, procurement , construction and commission service provider for major IOCs in Sub Saharan Africa. This partnership represents a significant leap forward in providing critical medical care across offshore and remote locations . By bringing together our collective strengths, we are establishing a world class air ambulance and HEM programme that will have a profound impact on the health and well being of workers in the oil and gas industry across the region.

    On his part, General Manager, NESTAV , Mr Ehis Uadiale said the partnership could not come at a better time given the iol and gas sector was in need of quick intervention to resolve issues of quick response to emergencies.

    He said with the right partners with global experience and requisite personnel, the narrative will change.

    He said the partners had considered critical success indicators to drive the value chain itemizing good equipment and personnel as key drivers to have the edge.

    Besides, he noted that a good regulatory regulatory framework, and adherence to global best practices will provide a template for delivery.

    Read Also: Fire destroys multi-million palm oil production company in Ebonyi

    He spoke of plans to extend the services to the public health sector in responding to emergency rescue services with dedicated  assets at specific locations.

    He said training programmes were ongoing to develop capacity to respond to public safety demands.

    Speaking during the signing event, Head of Training , ADAC HEMS Academy , Mr Philip Lex said its over five decades of experience will be leveraged to add value to the deal , which he described as a game changer.

    On his part, Medical Director, KASI Healthcare Offshore Aero Medical Unit , Dr Dayo Osholowu , the deal will bode well for the oil and gas and related sectors.

    He said the partnership has regulatory cover to enable the partners display their professional capacity .

  • Millions gone in Ebonyi palm oil firm fire

    Millions gone in Ebonyi palm oil firm fire

    A multi-million naira Palm Kernel Oil Extracting Industry at Onuebonyi axis of Abakaliki, in the Ebonyi State capital has been gutted by fire.

    Burnt were palm kernels worth over N170 million, refined and unrefined oil, as well as a Sienna bus.

    Executive Director of the industry, Mr Emmanuel Alinchi told The Nation that he noticed fire and smoke emission about 1:17am.

    According to him, before the arrival of the men of the Fire Service, the entire structure had been engulfed.

    He appealed to the state government for intervention, emphasising that his machines were destroyed by the inferno.

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    A relative of the victim, Mr Hillary Alinchi, said the cause of the  incident was not known as it happened in the night.

    He emphasised that the fire would have spread to other private buildings in the area if not for the resilience of the fire fighters who arrived early.

    “The palm kernel alone is more than N170million. Then, you have the refined and unrefined oil, the building and even a Toyota Sienna that were destroyed. The machines were burnt. If you add the machines and buildings and other burnt things, it will be close to N500million,” he lamented.

    He said about 50 workers had lost their jobs as a result of the inferno and appealed to Governor Francis Nwifuru to assist them.