The Nation Newspaper

Tag: petroleum products

  • FG to spend N3.4tr on petroleum products in 2017

    FG to spend N3.4tr on petroleum products in 2017

    …requires $1.1b, $1.2b for repairing refineries
    The Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu, on Thursday revealed that the Federal Government would in this year spend N3.4trillion on the importation of petroleum products.
    Addressing newsmen in Abuja, he refuted reports that quoted him to have said that government was concessioning its refineries.
    He said that government has no plans to concession the refineries but it is only making arrangements for private financing of their repair. The minister denied the claims that Oando has won the contract for financing the repair of the refineries.
    According to him, Nigeria that consumes 35million daily presently has domestic refining capacity of six million liters, which is about 25% of the demand.
    “The importation of products even between January and December of this year, amounts to 20million metric tonnes and a total amounting of N3.4 trillion. The logistic cost of that importation shipping clearing and all that is about N1.34trillion since the same one year period,” the minister said.
    Owing to this domestic and demand situation, the government had to plan for the improvement of its domestic refining capacity.
    Kachikwu noted that government raised a technical and steering committees on the financing of the refineries that its report will be presented to the National Assembly and Federal Executive Council upon conclusion.
    He however noted that what has been so far established is the magnitude of work that is required in the entities.
    The minister said that apart from piping, about $1.1billion, $1.2billion (depending of the category), will be required to fix the refineries.
    His words: “Internally, we have been able to determine the amount we want to do this work in terms of what work is required to be done. And the total cumulative amount if I am not mistaking is the $1.1, $1.2b type category depend on the refineries with specific breakdown. That of course does not include the cost of piping.”
    Explaining why government has decided to deal with the Chioda, Sapiem and GGC, he said that Chioda built Kaduna refinery, Sapiem built Warri refineries while CGC built the PortHacourt refineries.
    These companies, according to him, have the designs, engineering outlay and upgrade capability for the refineries.
    Today, the reality is still that the reality for downstream product surges that very few people will undertake the financing.
    “So that is why we have created a business model that tie them to the Direct Sale Direct Purchase (DSDP) Programme and that is still working and that is still work in progress.
    “When they finish this and are done with the analysis, I will expect that they will then invite everybody who is interested to the commercial terms set out formally…before we get to FEC, National Assembly and Mr. President. We haven’t reached there and so nobody can say contracts have been given.”
    Kachikwu advised the International Oil Companies to invest in building refineries in Nigeria in order to avoid the negative effects of dip in oil prices.
    He said more importantly, we need to address IOCs in terms of what they need to do to help local refining because if you encourage all these refining capabilities whenever they run out of crude availability we need to look at them why are you taking out crude when you can get the same pricing equivalent in local refining.”
    In terms of the incentives or guarantee for the corporations that would finance the repair of the refineries, he said that there will incremental volumes, access to sales to cushion the challenge in the markets in terms of pricing.
    He revealed that the Organization of Petroleum Exporting Countries (OPEC) is reaching out to its non-members including the US on measures to control the glut in the market.
  • FG to spend N3.4tr on petroleum products this year

    FG to spend N3.4tr on petroleum products this year

    …Requires $1.1b, $1.2b for repairing refineries

    The Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu, Thursday revealed that the Federal Government would in this year spend N3.4trillion on the importation of petroleum products.

    Addressing newsmen in Abuja, he refuted reports that quoted him to have said that government was concessioning its refineries.

    He said that government has no plans to concession the refineries but it is only making arrangements for private financing of their repair. The minister denied that the claims that Oando has won the contract for financing the repair of the refineries.

    According to him, Nigeria that consumes 35million daily presently has domestic refining capacity of six million liters, which is about 25% of the demand.

    The minister said “the importation of products even between January and December of this year, amounts to 20million metric tonnes and a total amounting of N3.4 trillion. The logistic cost of that importation shipping clearing and all that is about N1.34trillion since the same one year period.”

    Owing to this domestic and demand situation, the government had to plan for the improvement of its domestic refining capacity.

    Kachikwu noted that government raised a technical and steering committees on the financing of the refineries that its report will be presented to the National Assembly and Federal Executive Council upon conclusion.

    He however noted that what has been so far established is the magnitude of work that is required in the entities.

    The minister said that apart from piping, about $1.1billion, $1.2billion (depending of the category), will be required to fix the refineries.

    His words: “Internally, we have been able to determine the amount we want to do this work in terms of what work is required to be done. And the total cumulative amount if I am not mistaking is the $1.1, $1.2b type category depend on the refineries with specific breakdown. That of course does not include the cost of piping.”
    Explaining why government has decided to deal with the Chioda, Sapiem and GGC, he said that Chioda built Kaduna refinery, Sapiem built Warri refineries while CGC built the PortHacourt refineries.

    These companies, according to him, have the designs, engineering outlay and upgrade capability for the refineries.

    Today, the reality is still that the reality for downstream product surges that very few people will undertake the financing.  So that is why we have created a business model that tie them to the Direct Sale Direct Purchase (DSDP) Programme and that is still working and that is still work in progress.

    “When they finish this and are done with the analysis, I will expect that they will then invite everybody who is interested to the commercial terms set out formally…before we get to FEC, National Assembly and Mr. President. We haven’t reached there and so nobody can say contracts have been given.”

    Kachikwu advised the International Oil Companies to invest in building refineries in Nigeria in order to avoid the negative effects of dip in oil prices.

    He said more importantly, we need to address IOCs in terms of what they need to do to help local refining because if you encourage all these refining capabilities whenever they run out of crude availability we need to look at them why are you taking out crude when you can get the same pricing equivalent in local refining.”

    In terms of the incentives or guarantee for the corporations that would finance the repair of the refineries, he said that there will incremental volumes, access to sales to cushion the challenge in the markets in terms of pricing.

    He revealed that the Organization of Petroleum Exporting Countries (OPEC) is reaching out to its non-members including the US on measures to control the glut in the market.

  • Navy destroys boats, petroleum products in Anambra

    Navy destroys boats, petroleum products in Anambra

    The Nigeria Naval Outpost in Onitsha, Anambra State, has destroyed two boats with petroleum products, warning perpetrators to desist or face prosecution.
    Commander Navy Capt. Mohammed Dahiru, who briefed reporters yesterday, said the illegal products were intercepted last December along the River Niger waterways.
    He said the destruction was done two days ago in the presence of other security agencies including the Army, police, Department of State Services (DSS), among others.
    “We warn illegal operators within River Niger to have a rethink as it would no longer be tolerated. I will continue to go after them, and I will get them, especially now that our capability has been boosted by the naval authority.
    “My officers and men have intensified routine patrols, including fixed station, stop and search. For those using or want to use the River Niger waterways for legitimate activities, they are assured of adequate protection,” the commander said.
    Capt. Dahiru lauded the Chief of Naval Staff, Vice-Admiral Ibok Ibas, for providing the Naval Outpost Onitsha with good working and accommodation environment, and Governor Willie Obiano for his support.

  • Ships laden with petroleum products, food items to arrive Lagos ports

    Ships laden with petroleum products, food items to arrive Lagos ports

    Twenty four ships laden with petroleum products, food items and other goods are expected to arrive Apapa and Tin-Can Island ports in Lagos from March 14 to March 25.

    The Nigerian Ports Authority (NPA) stated this in its publication – `Shipping Position’, – a copy of which was made available to the News Agency of Nigeria (NAN) on Tuesday in Lagos.

    NAN reports that seven of the expected ships would berth with petrol.

    NPA said that the remaining 17 ships contained buck wheat, general cargoes, steel products, diesel, crude palm olein, soya bulk corn, gypsum, empty containers and containers laden with goods.

    The document noted that seven ships had arrived the ports, waiting to berth with bulk fertiliser, crude palm olein and petrol.

    NAN reports that 19 other ships are at the ports discharging empty containers, bulk wheat, containers, steel products, bulk fertiliser, soya bean, soda ash, bulk sugar, containers and petrol.

  • NSCDC warns vandals, adulterators of petroleum products

    NSCDC warns vandals, adulterators of petroleum products

    The Nigeria Security and Civil Defence Corps (NSCDC) has again warned vandals, illegal dealers and adulterators of petroleum products to desist from the act or face the wrath of the law.

    Its Commandant General (CG), Mr Abdullahi Muhammadu, gave the warning against the backdrop of the recent sentencing of 16 persons to life imprisonment for petroleum product adulteration in Calabar, Cross Rivers.

    The News Agency of Nigeria (NAN) recalls that the offenders were convicted and sentenced by a Federal High Court presided over by Justice Inyang Ekwo on Tuesday.

    The convicts, who were arrested by the Bayelsa Command of the NSCDC on July 7, were found guilty of adulterating 100 tonnes of petroleum product suspected to be diesel.

    A statement by the NSCDC spokesman, Mr Emmanuel Okeh, quoted the CG as saying there was no hiding place for vandals and economic saboteurs.

    Muhammadu stated that the corps was poised to effectively pursue its mandate of protecting critical infrastructure and other national assets.

    “Vandals and their cohorts should either quit the illicit business or relocate from the country as the NSCDC is prepared to fish out those who have chosen to be enemies of the nation.

    “Enough is enough; we must rise to the challenge of tackling this ugly phenomenon of vandalism and other related crimes.

    “Attacking our personnel will not deter us from fighting the scourge, rather it will make us more rugged and dogged in the crusade, ‘’ he said.

    The CG charged the personnel not to relent in the fight against vandalism, illegal oil bunkering, theft and allied criminal acts.

    The CG commended the judgment, saying that it would serve as deterrent to others.

    He urged other judges to emulate Justice Ekwo through speedy trial of cases brought before them.

  • Fuel Scarcity: Niger inaugurates 11-man task force

    Fuel Scarcity: Niger inaugurates 11-man task force

    Niger State Governor, Alhaji Abubakar Sani Bello has constituted a committee to monitor the delivery of Petroleum products and dispensation to the general public in the State, especially in Minna, the state capital.

    The 11- Man Committee was constituted on Monday by the governor, following the seemingly  intractable chaotic situations at the Fuel stations throughout the state in recent times.

    According to a Circular, with reference number SSG/ S/ 307 issued on Monday  by the Chief of Staff  to the Governor/ Acting Secretary  to the Government of Niger State , Hon. Mika’il Al- Amin Bmitosahi, a copy of which was obtained by  The Nation, the Niger State Police Commissioner, Mr. Abubakar Marafa is the Chairman of the Committee.

    The Commander, 31 Artillery Brigade, the State Director, Directorate of the State Security Service and State Commander of the Nigeria Security and Civil Defence Corps (NSCDC) are to expected to nominate Senior Officers to serve on this Committee.

    The 11-Man Committee also has the state Chairman of the Nigerian Union of Journalists {NUJ}, Comrade Mohammed Mohammed, Special Adviser Special Duties to the Governor, the Zonal Coordinator, Department of Petroleum Resources{DPR}, representative of NUPENG, representative of the National Orientation Agency (NOA), the Senior Special Assistant to the Governor in Chanchaga Local Govt. of the State/ Chairman, LGAs, as well as the representative of the State Ministry of Investment respectively.

    The Committee was urged by the governor to swing into action immediately adding that the era of sharp practices by petroleum marketers in the state should be cut down.

  • 31 ships with petroleum products, food items to arrive Lagos

    31 ships with petroleum products, food items to arrive Lagos

    Thirty one ships laden with petroleum products, food items and other goods are expected to arrive Apapa and Tin-Can Island Ports in Lagos from April 6 to April 24.

    The Nigerian Ports Authority (NPA) stated this in its publication – `Shipping Position’, – a copy of which was made available to the News Agency of Nigeria (NAN) on Wednesday in Lagos.

    NPA explained that the expected ships contained buck wheat, empty containers, frozen fish, bulk sugar, general cargoes, containers, steel products, diesel and petrol.

    The document noted that a ship had arrived the port, waiting to berth with aviation fuel.

    NAN reports that 16 other ships are at the ports discharging general cargoes, wheat, ethanol, aviation fuel, crude palm oil, containers and petrol.

  • FG moves to reduce trucking of petroleum products

    FG moves to reduce trucking of petroleum products

    •Engages private security contractor for pipeline surveillance
    •Refineries to get external ‘help,’ says Kachikwu
    •To use third party financing for refineries repair

    The federal government has moved to reduce road transportation of petroleum products with trucks from coastal depots and storage facilities in the country to hinterlands.

    Speaking with journalists during his inspection tour to the Port Harcourt Refinery Company (PHRC) on Christmas Day in Port Harcourt, Rivers State, the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, revealed that government would trim down the country’s dependence on the use of trucks to distribute fuel and rather improve the use of pipelines for product conveyance.

    According to him, in the bid to revive pipeline distribution of products, the government has signed up private intelligence firms to augment existing security arrangements on the country’s about 5000 kilometres long stretch of pipeline network.

    The efforts, he said, would enable the Pipeline and Products Marketing Company (PPMC), a subsidiary of the Nigerian National Petroleum Corporation (NNPC), push more products through the pipelines to the hinterlands.

    He said that up to 4000 trucks laden with petroleum products ply through the length and breadth of the country’s roads every day to supply petroleum products across board.

    This, he said, has continued to impact on Nigeria’s road infrastructure, amongst other impacts.

    However, the National Operation Controller of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Comrade Mike Osatuyi, told The Nation that NNPC started massive trucking of supply of petrol to their members since December 24 to address the lingering scarcity across the country. He said over 300 trucks of PMS were supplied by NNPC yesterday.

    Kachikwu , who is also the Group Managing Director (GMD) of the Nigerian National Petroleum Corporation (NNPC), said, “We are bringing in private securities to secure the pipelines. The key is to continue to maintain this and I think we are beginning to get the feel that we are getting some sense of what we need to do.

    “It is a combination of many factors: communities, contractors and all sorts, it still makes it expensive but it is better than having to truck them through the roads.”

    The Managing Director, Pipeline and Product Marketing Company (PPMC), Mrs. Esther Nnamdi-Ogbue, however, corroborated this position to reporters at the Private Wing of the Nnamdi Azikiwe International Airport, Abuja yesterday.

    The PPMC, according to her, is now opening up the pipelines and pumping products via them to other different parts of the country.

    She said, “There is no going back on the use of pipelines” to distribute petroleum products in the country, adding that the introduction of private security outfits in the pipelines’ security arrangement was beginning to yield results.

    “Since the beginning of the fuel scarcity, what we’ve done is to manually track every truck leaving any of our depots either in Lagos; Warri, Oghara or Calabar.

    “What we have done is to insist that our pipelines must work. We have an initiative with the private sector to help us secure and maintain our pipelines and that has yielded positive results almost immediately, vandals are being caught.”

    The Managing Director added that “We have now started pumping all the way to Ibadan. Our target is to move to Ilorin and that will relieve bridging products from the coastal towns to the hinterlands of the north.

    “We are also building a simultaneous effort in Port Harcourt, hoping that it will lead all the way to Markudi to Yola and these are things we have never done before for a long time. We want to have a more efficient way of distributing products nationwide.”

    While giving brief details of the new security arrangement for the pipelines, Nnamdi-Ogbue said: “What we had done was that we had the Joint Taskforce who were with us but had not yielded good results and we have private people who told us that they have equipment and expertise to help secure the pipelines.”

    “We had them come and present to a committee their proposals. They were about 15 but we cannot give you full details because these are security issues, but just to let you know that they are working.”

    On the outcome of the arrangement so far, she said: “Assets used to vandalise and steal our products will be destroyed. We have also made sure that personnel at the pipelines are constantly changed to stop them from getting compromised.

    She also said that the PPMC will from January 2016 introduce new tracking measures to avert instances of products diversion in the country.

    “PEF is already doing a depot to depot tracking to calculate the mileages of tankers for their payment, however, in PPMC, we are interested in real-time tracking to help us detect diversion and we are expecting that we will fully launch this within the first weeks of January,” added Nnamdi-Ogbue.

    Meanwhile, Kachikwu has said that the country’s four refineries: Kaduna; Warri and Port Harcourt would be given external help to keep them active even after repair works on them are completed.

    “From the briefing I have gotten today, they are fairly close to reopening and producing. Over the next one week, we expect to see products out from here.

    “A lot of these works, we have had to do with intensive manual labour with the staff who are here, largely because lack of funding has not enabled us to do the kind of holistic changes we need to do, that is still going to come to support them.”

    Kachikwu further said: “The actual solution is for the refineries to work, if they work it is easier and when they don’t work, I have a double headache.

    “We will shut them down, repair them and bring in external help. My assessment today is that Kaduna is up. Port Harcourt is coming up but not at the level where they would not need help. We will likely see both Warri and Kaduna not shut down, but we are going to work on mechanisms whereby they can keep producing on a part time basis.

    “We are going to bring in third party financials to help us put money into them, get them holistically where they should be and then work out the payment structure. My position is that irrespective of whatever we do, these refineries must be brought back through financing to the levels where they should be, otherwise we are wasting our time,” he added.

     

  • Seven oil thieves jailed for 12 years

    Seven oil thieves jailed for 12 years

    Seven men were Friday sentenced to 12 years imprisonment by the Federal High Court in Lagos for stealing petroleum products.

    Justice Okon Abang found Adedamola Ogungbayi, Olaniran Olabode, Suraju Gasali,  Moses Emmanuel, Wilson Bonsi, Okaraodi Uche and Onyeogo Happy guilty of idealing in 1,459 metric tonnes of Premium Motor Spirit (or petrol) without licence.

    The judge held that the convict’s crime amounted to economic sabotage.

    He described them as “godless”, saying such acts must be punished.

    He said: “The convicts have no sympathy for the corporate existence of this country. The seed of wrongdoing may be sown in secret but the harvest cannot be concealed. Today is the day of reckoning.

    “You call it oil bunkering or pipeline vandalism, but this menace has reached an alarming proportion in this country. Enough is enough.

    “The convicts are godless and lawless, without any particle of sympathy for this country. They are part of the people that have contributed to the economic woes of this country.

    “The convicts planted thorns, they cannot expect to gather flowers; they sowed the wind, and they must gather whirlwind.”

    The judge also ordered the vessel, MT Good Success, used in committing the crime, as well as the recovered petroleum product, be forfeited to the Federal Government.

    Justice Abang ordered the forfeiture of the sums of N66.6million and $975,000 belonging to the convicts’ company, Hepa Global Energy Limited, domiciled with the First City Monument Bank.

    An affidavit of compliance with the orders of forfeiture must be filed within 21 days of the judgment, the judge directed.

    The convicts, their vessel and company were re-arraigned last August 28 on five counts, along with Padoun Jacob, who was discharged and acquitted Friday.

    The judge, in setting Jacob free on all the five counts, described him as a desperate job seeker, who became a victim of circumstances.

    He noted that the stolen product had been loaded before Jacob was employed by Hepa Global Energy Limited on February 7, 2014.

    “The guilty should not escape punishment but the innocent should not be punished,” the judge held.

    Rather than life sentence, this is the maximum penalty for the crime, the judge ‎handed each of the convicts a 10-year jail term on each of the counts, and two years on ‎the fifth count. The total of 12 years will run concurrently.

    The Economic and Financial Crimes Commission (EFCC) prosecutor, Mr. Rotimi Oyedepo, the convicts violated sections 19(c) and 17 of the Miscellaneous Offences Act, Cap M17, Laws of the Federation of Nigeria, 2004.

     

  • NUPENG okays railway haulage of petroleum products

    NUPENG okays railway haulage of petroleum products

    The National Union of Petroleum and Natural Gas Workers (NUPENG), said it has no objection to the use of railways for haulage of petroleum products across the country.

    The South-West Chairman of the Union, Mr. Tokunbo Korodo, told newsmen in Lagos that it is a good development as long as Nigerians would not be deprived the right to get the products at the approved prices.

    “We do not have any objection to any mode of distribution so far it will get to the masses at a reasonable price. Whether they use train or they use helicopter to distribute the products, we cannot kick against it because we know that there is no way a train can get to all the filling stations.

    “They will still park somewhere and use our trucks to get the products to any retail outlets. Even, the locomotive driver that drives any train loaded with petroleum products to any destination will, automatically, become my member,” he said.

    Korodo said the union will create another branch that will be added to the existing one, adding that it is a welcome development if that will be the best way.

    He noted that the best and fastest way to distribute petroleum products is through pipeline, adding that government is running away from it due to the activities of vandals.

    “It is sad that our security agencies cannot protect the pipelines,” he said, asking, “If the security agencies cannot protect our pipelines, then what is the fate of the ordinary Nigerian?”

    NUPENG had on June 1 asked the Federal Government to rehabilitate railways for petroleum haulage.