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Friday, 12 April 2019

NNPC discredits rumour of impending fuel scarcity

Liam Hope April 12, 2019 0

The Nigerian National Petroleum Corporation (NNPC) has urged Nigerians to disregard rumours of an impending scarcity of petrol in the country.

In a statement issued by Ndu Ughamadu, NNPC spokesman on Thursday, the corporation said such rumours were “tales fabricated by mischief makers with intent to create undue panic in the prevailing sanity in the fuel supply and distribution matrix across the country”.

“The Nigerian National Petroleum Corporation (NNPC) has once again appealed to Nigerians to disregard trending social media report of an impending fuel scarcity due to the purported refusal by some oil marketers to lift products from depots,” the statement read.

The state oil firm reassured Nigerians that it already has an ample stock of over one billion litres of petrol, with over two billion litres secured for April through imports of 48 vessels with each having a capacity of 50 million litres of petrol.

It said there was “no need for panic buying or hoarding of petroleum products in anticipation of a phantom scarcity.”

NNPC warns depot owners not to sell petrol above N133.38k per litre

Oil

Liam Hope March 31, 2019 0

The Nigerian National Petroleum Corporation (NNPC) has warned depot owners or terminal operators not to sell Premium Motor Spirit, otherwise called petrol, above the official ex-depot price of N133.28k per litre.

Mr. Ndu Ughamadu, Group General Manager, Group Public Affairs Division, who conveyed the warning in a statement, said the Corporation also cautioned petroleum products marketers not to sell the product above N145 per litre.

Ex-depot price is the ceiling at which depot owners or terminal operators sell products to marketers, while the pump price of a product is the amount consumers buy it from fuel stations.

A release today in Abuja by the Corporation said the subsisting ex-depot petrol price of N133.28k per litre was consistent with the Petroleum Products Pricing Regulatory Agency’s (PPPRA) template and should be adhered to.

Mr. Ughamadu stated that NNPC held stock of over 1billion litres, adding that imports of 48 vessels of 50million litres each have been committed for the month of April alone.

He advised Nigerians to remain vigilant and volunteer information to the Department of Petroleum Resources (DPR), the Industry regulator or to any law enforcement agency around them, on any station selling petrol beyond N145 per litre.

DPR tells filling stations to regularize illegal outlets or face sanctions

Oil

Liam Hope January 12, 2019 0

The Department of Petroleum Resources (DPR) has vowed to take necessary actions against any illegal retail outlets, including filling stations and gas plants, at the end of first quarter of this year.

Misau Abba, Abuja Zonal Operations Controller, DPR, gave the warning at the organisation’s 2018 Annual General Stakeholders Meeting with the theme: Regulatory Compliance as a veritable tool for safe and efficient operations in Nigeria’s oil and gas industry.

Abba said the grace period can only be allowed till first quarter after which appropriate sanctions would be meted out to outlets that default.

“DPR will take all necessary measures within the ambience of the law on any illegal retail outlets that fail to regularize after the expiration of the grace period,” he said.

The forum, which brought together major players in the downstream oil and gas sector to review 2018 operational challenges and set out new plan for the year was organised as part of the DPR’s efforts to sensitise stakeholders on guidelines governing operations.

Mr. Mordecai Danteni Baba-Ladan, the Director of DPR said the department has made some new innovations in order to serve the public better.

Represented by the Zonal Controller, Maiduguri Mr. Idris Ali, the DPR boss said one of the new innovations was the full implementation of online processing of downstream licences, permits and approvals.

“These were achieved through the Retail Outlets Monitoring System (ROMS), Depots System (DEPOT), Import and Export (IMPEX), Lube Blending Plant System (LBL), Coastal Vessel License System (CVL) and Refinery Operations System (RPL),” he said.

He said the oil and gas industry service permit (OGISP) application has also been automated meaning that interested applicants can easily make applications from the comfort of their homes or offices worldwide.

Alhaji Sulieman Butu, IPMAN Chairman, Suleja/ Abuja zone, urged NNPC to always ensure there is enough products for distribution.

“We on our part are ready. Our monies are there ready to buy these products whenever their products and our stations are ready for effective distribution,” he said.

He said marketers now get their licenses within two weeks of application due to DPR’s introduction of electronic licencing programme.

According to him, licensing could take six months or more but the innovation has made licencing easy and faster.

Oil marketers reveal why they postponed shutdown of operations

Oil

Liam Hope December 10, 2018 0

The Depot and Petroleum Products Marketers Association (DAPPMA) has suspended its planned shutdown of depots across the country from loading petroleum products effective from 12-midnight on Sunday, December 9.

The suspension directive was conveyed in a statement issued by DAPPMA Executive Secretary, Mr Olufemi Adewole, at about 1.20am on Monday in Lagos.

Adewole said: “Recall the association had issued a shut down directive to our members following the continuing indebtedness of the Federal Government to the petroleum marketers.

“However, following the intervention of well-meaning Nigerians including the National Assembly as represented by the Senate Committee of Petroleum Downstream and constructive engagement of the Federal Government team by the labor unions most affected by the disengagement of our personnel, namely, PENGASSAN, NUPENG NARTO, PTD,and DAPPMA.

“The union has resolved to recall its disengaged personnel for five days to give the Federal Government’s team the opportunity to conclude its process of paying marketers the full outstanding of N800 billion with the first tranche being the amount already approved by the Federal Executive Council (FEC).

“The association has acted in good faith to avoid unnecessary hardship which could befall Nigerians during the Yuletide season and we hope that government would make good its promise to see that those issues are resolved by Friday, December 14, 2018 as promised.

“To this end, our disengaged personnel would be recalled on Monday, December 10, and considering the reactivation time or hitherto shut down the system, all depots with fuel stock should be fully active same day,’’ he said.

Adewole said that the conclusion of the debts payment would curtail the continuing wastage of public funds as interest accruing on the over N800 billion debt.

“DAPPMA depots are, therefore, advised to commence loading operations immediately and await further notification in respect of our long overdue payment,” he said.

We are not going on strike - NUPENG, PENGASSAN

Oil

Liam Hope December 08, 2018 0

The Oil workers unions have reassured the Federal government that its members would not go on strike over the threat of depot owners to shut down services over issues on payment of outstanding subsidy claims.

The unions are the Nigeria Union of Petroleum and Natural Gas Workers and Petroleum and Natural Gas Senior Staff Association of Nigeria.

The unions made this known in a joint statement signed by their presidents Messrs Francis Johnson and Williams Akporeha, in Abuja on Saturday.

“After series of engagements with government representatives and marketers, coupled with the on-going meetings, consultations and negotiations between the government and oil marketers, we have been assured by government that the first part of the debt payment will be made not later than 14th December.

“With this commitment and firm assurance from the government representatives, the leadership of NUPENG and PENGASSAN have resolved to hold down on taking any action on the issues to allow the government to fulfill its pledge.

“Our members should, therefore, remain calm and continue to provide their services as required always,’’ it said.

The unions’ leaders assured their members and the public that the decision was based on upholding the overall interest of the nation, the industry as well as job security of its members.

They urged the public to refrain from panic buying or stockpiling of petroleum products.

“We firmly believe that the current engagements and discussions among all concerned stakeholders will lead to amicable resolution of matters at hand.

“Our resolve and decision are purely nationalistic, patriotic and in the overall interest of our great country and we plead for understanding of the general public and all parties in this matter,’’ they said.

(NAN)

OPEC waiting for Russia before deciding how much oil to cut

Oil

Liam Hope December 06, 2018 0

The Organisation of the Petroleum Exporting Countries has made a planned cut in oil output effectively conditional on the contribution from non-OPEC producer Russia, delegates said on Thursday as the group gathered in Vienna for a meeting aimed at supporting battered oil prices.

Five delegates said the group was waiting for news from Russia as Energy Minister, Alexander Novak, had flown back from Vienna for a possible meeting with President Vladimir Putin.

Novak will return to Vienna on Friday for talks between OPEC and its allies, following discussions among OPEC producers.

“I am optimistic; there will be a deal, but it is unclear how much OPEC and how much non-OPEC will contribute.

“It is still under discussion,’’ one delegate said.

Three delegates said OPEC and its allies could cut output by one million barrels per day if Russia contributed 150,000 bpd of that reduction.

“If Russia contributed around 250,000 bpd, the overall cut could exceed 1.3 million bpd.

“The cut will be between 1.0 and 1.3 million bpd.

“We just have to see how it will be distributed,’’ another delegate said.

The Middle East-dominated OPEC planned to cut output despite pressure from US President Donald Trump to support the global economy by keeping oil prices low.

OPEC’s de facto leader, Saudi Arabia, has indicated it wants the organisation and its allies to curb output by at least 1.3 million bpd, or 1.3 per cent of global production.

Riyadh wants Moscow to contribute at least 250,000-300,000 bpd to the cut but Russia insists the amount should be only half of that, according to OPEC and non-OPEC sources.

Oman’s Oil Minister, Mohammed bin Hamad Al-Rumhy, said on Wednesday that the cuts would take September or October 2018 as baseline figures and last from January to June.

Oil prices LCOc1 have crashed by almost a third since October to about $61 per barrel as Saudi Arabia, Russia and the UAE have raised output since June after Trump called for higher production to compensate for lower Iranian exports.

Iranian exports have plummeted after Washington imposed fresh sanctions on Tehran in November.

(Reuters/NAN)

Oil rally 2% on production cuts prospect

Oil

Liam Hope December 04, 2018 0

Prices of Oil rallied by more than 2 percent on Tuesday, extending gains ahead of expected output cuts by producer cartel OPEC and a mandated reduction in Canadian supply.

International Brent crude oil futures rose by 2.5 percent to come to $1.55 having attained a high of $63.24 by 0955 GMT. U.S. West Texas Intermediate (WTI) crude futures were $1.25 higher at $54.20.

Recall that both benchmarks grew by around 4 percent on Monday after U.S. President Donald Trump and Chinese President Xi Jinping agreed at a meeting of the Group of 20 industrialized nations (G-20) to pause an escalating trade dispute.

“The market seems positively oriented following the G-20 developments and heading into the OPEC meeting on Thursday,” BNP Paribas commodities strategist Harry Tchilinguirian told Reuters Global Oil Forum.

“A commitment by Russia to cooperate with Saudi Arabia and achieve an agreement at the next OPEC meeting has certainly lifted spirits,” he added.

The Middle East-dominated Organization of the Petroleum Exporting Countries will meet on Thursday in Vienna to agree future output and will discuss strategy with other producers outside OPEC, including Russia.

OPEC and its allies are working towards a deal to reduce oil output by at least 1.3 million barrels per day (bpd), OPEC sources have told Reuters, adding that they were still talking to Russia about the extent of its production cuts.

“We expect OPEC to follow suit and agree to a production cut in Vienna this coming Thursday,” U.S. bank Goldman Sachs said in a note to clients.

“A cut in OPEC and Russia production of 1.3 bpd will be required to reverse the ongoing counter-seasonally large increase in inventories.”

It added that it expected a joint effort by OPEC and Russia to withhold supply to push Brent oil prices “above the mid-$60 per barrel level.”

Helping OPEC in its efforts to rein in emerging oversupply was an order on Sunday by the Canadian province of Alberta for producers to scale back output by 325,000 bpd until excess crude in storage is reduced.

OPEC’s biggest problem is surging production in the United States where output, mostly from its southern shale fields, has grown by around 2 million bpd in a year to more than 11.5 million bpd.

Barclays bank pointed out in a note to clients that oil production in the state of Texas alone “reached 4.69 million bpd in September, compared with Iraqi output of 4.66 million by our estimates”.

Iraq is OPEC’s second-biggest oil producer, behind Saudi Arabia.

Nigeria lost $6bn in Malabu oil scandal

Oil

Liam Hope December 01, 2018 0

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The President, Resource for Development Consulting, Dr. Don Hubert said Nigeria lost between $6 billion and $10 billion in the Malabu Oil Scandal currently under investigation by the Economic and Financial Crimes Commission, (EFCC) and outside the country.

Hubert, an extractive Industries analyst disclosed while submitting sensitive documents on the case to the anti-graft agency In Abuja, said the loss was from the federal government’s share of the profits.

The documents, expected to assist the EFCC In its probe, contains the terms and conditions for the sale of the controversial Oil Prospecting Lease, OPL 245, otherwise known as Malabu Oil Block, to Shell and Eni.

According to the Canada-based analyst who heads the organization that has helped countries that are rich in oil and gas to get a fair share of the revenue, analyze oil contracts and build economic model, the loss of revenue to the Nigerian people and government was to the tune of at least $4.5 billion.

“The reason for the losses is the core relevant of a production sharing contract, the share of profit to the government has been removed from this particular deal,” he said, explaining further that “as it stands today, Nigeria will lose between $6 billion and N10 billion to the deal, which is now being investigated outside Nigeria”.

The Acting Chairman, EFCC, Ibrahim Magu, in a statement by the Ag. Head, Media & Publicity, EFCC, Tony Orilade, assured that the anti-graft agency would soon round up investigations into the Malabu Oil Scandal and prosecute those involved.

Magu who received the documents on the case pledged that the commission would present a water-tight case during prosecution.

“We shall constitute a committee to digest it so that investigation can be extended to all grey areas and charges brought or amended against the suspects accordingly”, Magu said after receiving the documents, adding that the EFCC was taking its time to investigate the scandal to plug all loopholes.

Chairman of HEDA Resource Centre, Olarewaju Suraju, a “corruption hunter”, and one of the partners in the team that produced the findings on the OPL 245, commended the efforts of the EFCC in the fight against corruption.

Suraju who said they prepared the damning finding to enable the Nigerian government identify and punish the individuals and organizations involved in the oil scam explained that all hands must be on deck to stop further pillage of the nation’s oil revenue.

“It is the strong recommendation of HEDA and the partners that the OPL 245 license should be revoked and we now have both economic and legal basis to challenge the deal”, he said.

Refineries to be fixed in 2020 – Kachikwu

Oil

Liam Hope November 27, 2018 0

Plans by Nigerian government to fix Nigeria’s moribund refineries and make them work in utmost capacity will not materialize until 2020, Ibe Kachikwu, Nigeria’s oil minister has said.

Mr Kachikwu spoke in Lagos on Monday at the 18th edition of the International Biennial Health Safety and Environmental (HSE) Conference on the oil and gas industry in Nigeria organized by the Department of Petroleum Resources (DPR).

Also, contrary to his earlier claim of 2019, Mr Kachikwu said Nigeria’s refinery capacity will reach expected 1.1 million barrels per day in 2020.

The minister said this will be achieved when Dangote Petrochemical refinery’s 650,000 bpd, Nigeria’s four refineries of 450,000bpd capacity and three modular refineries come on stream.

Last year, Mr Kachikwu had in an interview with BBC vowed to resign if Nigeria continues to import fuel by 2019. In the interview, which lasted 23 minutes, Mr. Kachikwu promised to deliver on the completion of the refineries, noting that he was committed to delivering a future for oil in Nigeria.

When specifically asked when the country was going to be self-sufficient in terms of refining petroleum, Mr. Kachikwu declared that 2019 had been set as the target.

“2019 is the target time… I target 2019 . If I don’ t achieve it, I will walk (resign)…I put the date and I will achieve it,” the minister had said.

But speaking in Lagos on Monday, the minister said Nigeria’s desire to achieve fuel sufficiency may not be realisable in 2019 but in 2020.

According to him, 10 out of over 20 private modular refineries of about 400,000 refining capacity have shown serious commitment, three of which he said may come on stream in 2019 while Dangote refinery is expected to come on stream in 2020.

He said, “I am very excited about the development as they tend to create fuel suffiency as well as employment opportunities. We are also working hard to see the Nigerian National Petroleum Corporation (NNPC)’s four refineries coming up with 425,000 b/d in 2020.

“Hopefully, we will be having board meeting next week where we will take some soft landing decisions for the commercial investment on the refineries. In all, we are expecting about 1.1 million barrels refining capacity by 2020.”

Nigeria produces an average of 1.8 million barrels of oil daily, from which it generates resources to fix overheads, infrastructure and other government concerns. The nation however imports its products despite being one of the world’s top producer as its refineries have been moribund for years.

The NNPC has four major refineries, two in Port Harcourt, Rivers State, which combine to form the Port Harcourt Refining Company (PHRC) with a combined installed capacity of 210,000 barrels per stream day (bpsd); the Kaduna Refining and Petrochemical Company Limited (KRPC) with an installed capacity of 110,000 bpsd; and the Warri Refining and Petrochemical Company Limited (WRPC) with an installed capacity of 125,000 bpsd.

All the refineries have a combined installed capacity of 445,000 barrels per day.

Despite the huge resources expended on Turn Around Maintenance, none of Nigeria’s four refineries worked up to 50 percent of their capacity at any time during 2017, according to official figures from the state oil firm, NNPC.

DPR discovers 50 illegal filling stations in Akwa Ibom

Oil

Liam Hope November 26, 2018 0

The Department of Petroleum Resources, Eket office says it had discovered 50 illegal filling stations in the state.

Mr Tamunoiminabo Kingsley-Sundaye, the Operations Controller of DPR in Akwa Ibom made the disclosure in an interview with the News Agency of Nigeria in Eket on Monday.

He explained that the illegal filling stations refused to obtain Federal Government licenses nor follow due process in their construction.

He added that the filling stations were built without appropriate approval by the department in the state.

“There are 50 illegal filling stations in the state. We have come to a point in this country where people have decided to do things that are wrong.

“When I resume a year ago, we observed that there are some fuel stations that are built without appropriate approvals from the department,” he said.

He said that when building filling stations, there are things that are considered such as engineering design, safety, earth considerations and social economy of the area.

He condemned marketers that build filling stations that share boundaries with markets, schools, hospitals, saying that such stations would affect the economy of the area.

He warned marketers that build filling stations before coming to DPR for consideration to desist from it.

He said that the department had sensitised the marketers who were involved to come to the DPR office for reassessment and appropriate documentation.

“We have compiled those names and send them to the Nigerian Security and Civil Defense Corps to take appropriate actions,” he said.

(NAN)

Diesel price increased in October – NBS

Oil

Liam Hope November 25, 2018 0

The National Bureau of Statistics (NBS) says the average price paid by consumers for automotive gas oil (diesel) increased from N211.64 in September to N216.75 in October.

The NBS disclosed this in its “Automotive Gas Oil (Diesel) Price Watch for October 2018” report released in Abuja.

The report showed that the price of diesel decreased by 2.42 percent month-on-month and 7.33 percent year-on-year.

According to the bureau, states with the highest average price of diesel are Lagos (N238.55), Oyo (N231.32), and Sokoto (N231.25).

It named states with the lowest average price of diesel to include Bayelsa (N189.44), Zamfara (N200.71), and Plateau (N203.93).

Meanwhile, the bureau said the average price paid by consumers for Premium Motor Spirit (Petrol) decreased from N147.30 in September to N147.20 in October in the period under review.

The bureau in its Premium Motor Spirit (Petrol) Price Watch 2018, said the price decreased by -0.8 percent year-on-year and by -0.1per cent month-on-month.

It said states with the highest average price of petrol were Kebbi (N155.24), Benue (N153.33), and Taraba (N153.00).

Navy nabs 14 smugglers of adulterated diesel

Oil

Liam Hope October 02, 2018 0

Image result for Navy nabs 14 smugglers of adulterated diesel

No fewer than 14 men have been arrested by the Nigerian Navy for smuggling adulterated diesel and ‘black oil’ to unsuspecting consumers in Rivers, an official said.

Capt. Samuel Garba, Executive Officer, Nigerian Navy Ship Pathfinder, made the disclosure while parading the 14 suspected smugglers before newsmen in Port Harcourt, yesterday.

Garba said the suspects were caught trans-loading adulterated diesel and black oil from 12 large wooden boats into nine 33,000 litres capacity trucks.

According to him, the suspects were arrested in three different raids carried out at suspected illegal bunkering sites in Marine Base, Rumuolumeni and Eleme locations.

“In the first raid on Sept.16 at Horly Kings Waterfront at Marine base, our patrol team arrested nine suspects while trans-loading petroleum products. They were caught lifting substances believed to be stolen crude oil from eight wooden boats to six trucks stationed within a yard at the waterfront.

“In addition, a Sport Utility Vehicle stacked with sum of N1.95 million belonging to one of the suspects was confiscated,” he told newsmen.

Garba added that the troops also arrested one suspect accused of trans-loading stolen diesel from two wooden boats to a truck on Sept. 17 around Yesin Waterside area of Rumuolumeni.

He said the wooden boats were discharging the adulterated diesel to the truck stationed 100 meters away from the site before the seizure.

“The third raid was conducted on Sept. 27 around Sand Fill at Eleme. There, we caught four suspects in the act discharging substances suspected to be black oil.

“The suspects were discharging the petroleum product into two 33,000 litres capacity truck stationed nearby before their arrest and seizure. Consequently, a total of 14 suspects, 12 wooden boats with products and nine trucks were detained to enable the Navy base to conduct preliminary investigation,” he added.

Garba handed over the 14 suspects, diesel and oil to operatives of the Nigerian Security and Civil Defence Corps, NSCDC, to conduct further investigation and possible prosecution of the suspects in court.

He said the handover was in line with the Harmonised Standard Operating Procedures that spelt out roles for security agencies in combating illegalities in the oil and gas sector.

Federal Govt to start revocation of licenses of oil firms involved in gas flaring

Oil

Liam Hope September 24, 2018 0

Image result for Federal Govt to start revocation of licenses of oil firms involved in gas flaring

The Federal Government, Monday, disclosed that from next year, it would commence the revocation of the licences of oil companies that fail to stop flaring of gas in their operations in the country.

Speaking at the 2018 Buyers’ Forum/Stakeholders’ Engagement organised by the Gas Aggregation Company of Nigeria, GACN, Minister of State for Petroleum Resources, Mr. Ibe Kachikwu, also stated that the Federal Government would launch the infrastructure revamp programme in November, that has the potential of attracting between $20 billion and $30 billion of investments into the petroleum industry and also help address the infrastructural deficiencies in the industry.

On the gas flare issue, Kachikwu revealed that the Federal Government had been locked in a battle with upstream oil companies over the issue, explaining that the Federal Government was keen on ending flaring , but oil companies still give lot of reasons why gas flare cannot be ended.

According to him, the bottom line of the disagreement the oil firms had with the government on ending gas flaring was cash call and money.

He said, “Government wants to end flare, oil companies still give lot of reasons why flare cannot be ended. Bottom line is cash call and money. But the reality is that whether or not we deal with cash call issues, it is not an optional agenda, it is a compulsive immediate agenda. It is destructive to the populace; it is intolerable in developed country and it should not be tolerable here either.

“Any oil company that cannot find a way to ending its flare ought not to be producing. And I have said to the Department of Petroleum Resources, DPR, beginning from next year, we are going to get quite frantic about this and companies that cannot meet with extended periods — the issue is not how much you pay in terms of fines for flaring, the issue is that you would not produce. We need to begin to look at foreclosing of licences. This is very urgent.”

Kachikwu stressed that the quest to discourage gas flaring led the Federal Government to initiate the gas flare commercialisation programme.

In addition, the minister disclosed that future renewals of oil and gas licences would involve the assessments of the gas components and gas flare rate of each company seeking renewals.

“Some of the ones that have come recently for renewals have insisted that they are building massive gas processing plants and we are going to follow this right through so that the supply obligation, the processing facility, the treatment of gas; their submissions are very accurate and very aggressive,” he noted.

Kachikwu further emphasized the need for a critical implementation of the Domestic Supply Obligation, which would be extended to Domestic Supply and Processing Obligation for both gas and crude oil, stating that the country needed to move away from the point of just producing these commodities, throwing it into the vessel and shipping it out, to the point of processing as much of it locally as much as possible.

According to him, only through this would we be able to create more jobs, create better profit and returns on investments, achieve better pricing and address the challenges of local industries and industrialization.

Also speaking, Managing Director of GACN, Mr. Morgan Okwoche, called for increased support for the company, while he highlighted the need for optimum collaboration among industry players in the development of the gas sector.

He called on the DPR to expedite action on the issuance/renewal of the five-year rolling Domestic Supply Obligation, DSO, volumes which will help in effective project planning.

In addition, Okwoche said, “I would like to see the non-existence of a Gas Distribution tariff model which is encouraging arbitrariness and monopolist behaviours which may hamper effective implementation of the network code is not addressed ultimately.”

Trump asks OPEC to bring down oil prices

Oil

Liam Hope September 20, 2018 0

Image result for Trump asks OPEC to bring down oil prices

President Donald Trump on Thursday issued a fresh call on the OPEC oil cartel to lower crude prices, saying the United States was providing Middle Eastern energy giants with security.

“We protect the countries of the Middle East, they would not be safe for very long without us, and yet they continue to push for higher and higher oil prices!” he tweeted.

“We will remember. The OPEC monopoly must get prices down now!”

Trump has earlier called for members of the Organization of the Petroleum Exporting Countries — primarily cartel kingpin and US ally Saudi Arabia — to raise their production, and warned importers to stop buying oil from Iran or face US sanctions.

Two of OPEC’s founding members, Iran and Venezuela, are under sanctions from Washington.

A new set of US sanctions is due to hit the Islamic republic’s oil industry on November 4.

Output from Iran has hit its lowest level since July 2016, according to the International Energy Agency, as top buyers India and China have distanced themselves from Tehran.

In 2016, major producers both within and outside OPEC agreed to slash production in an attempt to boost prices following the 2014 oil market crash.

(AFP)

Kachikwu denies N1.4trilion remark

Oil

Liam Hope May 04, 2018 0

The Minister of State for Petroleum, Ibe Kachikwu, has replied human rights lawyer, Femi Falana’s Freedom of Information request, seeking to understand how funds spent to keep the price of petrol at N145 jumped from N261 billion annually to N1.4 trillion.

In‎ his response, Kachikwu denied the statement and described it as alarming.

“I, hereby, acknowledge receipt of your letter of April 17, 2018, requesting for information and data on under recovery. Your request to me is predicated on a statement purportedly credited to me to the effect that the Federal Government is spending N1.4 trillion monthly on payment for under-recovery on Premium Motor Spirit, PMS, importation.

“Let me for the umpteenth time state that I made no such statement and a previous rebuttal has clarified this. The information you quoted is both incorrect and alarmingly speculative.”

The Minister has been credited to have at a public function said: “It is time for Nigeria to harness alternative fuel sources like Liquefied Petroleum Gas LPG as under-recovery from the importation and sale of petrol at the. Government regulated price of ₦145 per liter has hit ₦1.4 trillion.”

In his reply to Falana, Kachikwu said it was the ‎Nigeria National Petroleum Corporation (NNPC), who would have the exact naira value spent on ‘under recovered funds,’ since it imports most of the petrol sold in Nigeria.

A month before Kachikwu’s debunked remarks, the Group Managing Director of NNPC Mikanti Baru had put the subsidy being spent to hold down the price of petrol at N774 million per day.

He said Nigeria’s daily consumption had risen from less than 35 million a day to over 60 million liters due to smuggling.‎

In the FOI order addressed to the petroleum minister, Falana queried the daily consumption figures, which had purportedly flown from 28 million in December 2017 to 60 million.

While stating that the average consumption in the five African countries Nigerian smugglers are touted to sell petrol to is an estimate of 250,000 liters a day, Falana said that does not account for the increase of 32 million liters per day.

He said the Ministry of Petroleum Resources and NNPC should give a true value of petrol usage, as they have spent millions on software that tracks petrol sales from the depots.

Since the Project Aquila Software has the capability to identify the owners and locations of all trucks loading petroleum products in Nigeria, why has your office and NNPC continued to blame smuggling for the drain of N4.6 billion daily on petroleum products? How many of the truck owners involved in the alleged smuggling have been arrested and arraigned in court since Aquila has the database of all Truck Owners in the country? Falana asked.

On the 27th of April, the Senate described NNPC's subsidy payments as illegal and ordered the Corporation to remit N216 billion into the Consolidated Revenue Fund Account.

Nigeria will end gas flaring in two years

Oil

Liam Hope May 04, 2018 0

The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mr. Mikanti Baru, has promised that gas flaring will end in Nigeria in a year or two.

Baru, who said this while speaking at the 50th Offshore Technology Conference (OTC) in Houston also said‎ the country has already reduced flared gas from 25% to 10%; scaling the state from the second to the seventh highest gas emitting country in the globe.

He said the corporation had adopted a multi-pronged approach to bringing down the volume of gas flared by oil companies.

According to him, the first step taken by the Corporation was to ensure no new fields were developed without a Field Development Plan, in order to prevent flaring from future projects.

Baru added that in conjunction with the Ministry of Petroleum Resources, the corporation has formulated a series of policies such as the Flare Gas (Prevention of Waste and Pollution) Regulations 2018 and adjustments to the gas flare penalty through its Gas Flare Commercialization Program.‎

“These have significantly reduced gas flared to current levels of about 800mmscfd and in the next 1-2 years we would have completely ensured zero routine flares from all the gas producers,” Baru noted.

He said the corporation’s flare programme has been followed up with an aggressive gas infrastructure programme: “Today, we have completed and commissioned almost 600km of new gas pipelines thereby connecting all existing power plants to permanent gas supply pipelines. We are also currently completing the. construction of the strategic 127km Obiafu-Obrikom-Oben gas pipeline –“OB 3” connecting the Eastern supply to the Western demand centres,” he added.

According to Baru, the Nigerian gas market is the most vibrant in Africa and is positioned for investments of up to $25 billion in ten years.

“Nigeria offers unique opportunities for investment in exploration, refining, storage, transportation, power, distribution and marketing of petroleum products,” Baru observed.

For the gas market to meet the GMD’s expectation, the country will need to resolve the pricing challenge faced by indigenous players; with specific reference to gas to power stakeholders.

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