sweetcrude march 2013 edition
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Sweetcrude March 2013 editionTRANSCRIPT
U P D A T E SMONTHLY BASKET PRICE
Jan-13 109.28
Nov-12 106.86
Sep-12 110.67
Jul-12 99.55
Apr-12 118.18
Feb-12 117.48
Mar-12 122.97
May-12 108.07
Jun-12 93.98
Aug-12 109.52
Oct-12 108.36
Dec-12 106.55
Feb-13 112.75
104
100
92Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Dec-12 Jan-13 Feb-13Nov-12
Daily | Weekly | Monthly | Yearly 108.62 US
98
116
120
124
A Vanguard Monthly Review Of The Energy IndustryMARCH, 2013
108
112
CONTINUES ON PAGE 4
P\10 P\14
Energy firms Energy firms
owe owe Nigerian Nigerian banks N1.5trnbanks N1.5trn
Energy firms
owe Nigerian banks N1.5trn
… Sector’s non-performing loans stands at N32bn… Sector’s non-performing loans stands at N32bn… Sector’s non-performing loans stands at N32bn
T e igu es s e kh f r p a
N1. tri ion owed 1 banks5 ll
0
N 2 bill o ar non- rfor ng3 i n e pe mi
29.2 bill o ow d by oi & ga firm
N 1 i n e l s
N2.4 billi d by power firm4 on owe
Figur s ma r e i 013 acc tse y is n 2 oun
To banks xposurp e e
BA- N 83bn oi gas, 1.4 1bn
U 1 l& N 7
N1. tri ion owed 1 banks5 ll
0
N 2 bill o ar non- rfor ng3 i n e pe mi
29.2 bill o ow d by oi & ga firm
N 1 i n e l s
N2.4 billi d by power firm4 on owe
Figur s ma r e i 013 acc tse y is n 2 oun
To banks xposurp e e
BA- N 83bn oi gas, 1.4 1bn
U 1 l& N 7
PIB: FG grants special incentives for gas… Grants 5yr tax holiday, production allowance
FG to begin inspection of power projects… Only 40 of 491 projects completed
Derivation: Mexico encourages higher wealth distributionP\7
ontroversy surrounding the planned C
procurement of $1.56 billion forward sales agreement package by the Management of the Nigerian National Petroleum Corporation, NNPC, to offset debt obligation was laid to rest on Thursday by representative of the consortium of Nigerian banks said to have facilitated the agreement.
In a presentation at the renewed Hearing of the Joint Committee of the House of Representatives on the alleged transaction, Mr. Ade Adeola, Managing Director, Project and Export Finance of Standard
Banks disown NNPC’s $1.56bn facility
VOL 03 N0. 46
COVER
OIL
FOCUS
Contents466
1010
1212
1919 FINANCE
2
1111
1414
2222
2020 TECHOLOGY
SOLID MINERAL
Feedback
2525
2727
2929
2323INSURANCE
MARITIME
COMMUNITY
LABOUR
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Ag. EDITORClara Nwachukwu
THE TEAM
MANAGER, MARKETINGUbong NELSON
Energy firms owe Nigerian banks N1.5trn
PIB: FG grants special incentives for gas
ABREC, USAID sign MDC on clean energy financing
Transparency accountability issues in derivation
Bad book keeping mar oil audit
NERC inducts members into complaints forum
Nigeria loses over $40bn investment in 2 years
Understanding oil and shale extraction
Beaming the light on small scale mining
PIB: TUC queries discretionary power to president, minister
Will oil majors adhere to premium no cover regime?
FG moves to harness sea ports for economic development
Community halts Shell gas project
POWER
t' alre a quarter i o the ear, buts ady nt y t e conomh eI y has no made uc t m hrogr s e a se of t e logjam
p es b c u h t een he Pre ency th Na i nalbe w t sid & e t o Assembl o r th bu t wh c as
y ve e dge , i h wr ce l e lved with h resident e nt y r so t e Pg n i n h e b u d t
s i g t g e . At th just o c uded NOG 2013, one of e -c n l t e e ren issu s discusse s th
h r cur t e d, wa eo pa e of doin business in the ount y. sl w c g c rC sequently spea er fter s eaker
on , k a pspoke of he need to a track th t f st e passagef the PI n o der t h e oi an
o B i r o ast n l d gas de l pme t, o ich he budge is ve o n n wh t tb n c m a r ee h k d .Bu t s all abou fun in t i
dge i t ds, and h s e i n S etc ude a usual unve ls he dit o we r s i tquant m f de s N rian ba ks e
u o bad bt ige n arexposed o little wo der t at ba ks ct ; n h n an barely nance an busi ss n matt r how
fi y ne o emal . S we a bac t the era of c t l s l o re k o api af ight s m st bu esses u n off o ol , a o sin t r sh re t borrow oney o r n hei oper i ns.
m t u t r at occ rding y, in ver se tio of his A o l e y c n te it on, Oil as, Finan e e hno o y, d i , G c , T c l gPowe , S lid M nerals, Labou , I surance,
r o i r narit me and Com unity there are n w M i m , edevelopm nt t at o r reader ne d o
e s h u s e t k n oa b o u t .
w n o r o u c i n, we brin o you th
I u F c s se t o g t ee it d ver ion of Ex nM bil' Mark d d e s xo o s Warpaper, delive d at he nual Aret Adams
re t An e ture ries. He took a ob loo th l c se gl al k at eo l and g s industr and he need foi a y t r N geria o cat h on i s t re ain i t c if t want o mt e r n a i n l y c e i i v
i n t o a l o m p t t e .I 's a m t ead!t us r
Nog PhotosAd
4Cover Story
MichaeL EBOH
Energy firms owe Nigerian banks N1.5trn...Sector’s non-performing loans stands at N32bn
Energy industry firms, including those operating in the power and oil and gas
sectors owe banks in Nigeria over N1.544 trillion, while the total bad debts profile of the firms stand at N31.65 billion.
Sweetcrude gathered the figures from the year end, December 31, 2011 financial statements of the banks released to investors and others stakeholders last year.
Although the 2012 financial statements of the banks are still being expected, but it is expected that banks will begin to release the results from the end of March, with analysts projecting that the figures will rise.
A breakdown of the total non-performing loans shows that the bad debts of oil and gas firms currently stands at over N29.214 billion, while those from the power sector stands at N2.44 billion.
These debts, recorded in the books of 10 of the commercial banks in Nigeria, were classified as Non-Performing Loans, NPL, and m i g h t s e e t h e b a n k s transferring the loans to the A s s e t M a n a g e m e n t Corporation of Nigeria, AMCON.
Despite the high non-performing loans and the challenges faced by the banks in lending to firms in the energy sector in the last couple of years, the banks still gave out loans totaling N1.544 trillion to oil and gas
Broad Street
and power firms during the period in review.
A breakdown of the total non-performing loans shows that the
bad debts of oil and gas firms currently stands at over N29.214
billion, while those from the power sector stands at N2.44
billion.
Banks disown NNPC’s $1.56bn
facility Chartered Bank, who spoke on behalf of the Consortium of banks restated the fact that the said $1.56 billion facility is not a loan but forward sale of crude oil with advance deposits to be made to the Corporation on standard NNPC sale terms at ruling market prices.
Before now, the Honourable Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke and the Group Managing Director of the NNPC, Engr. Andrew Yakubu had in separate presentations to the House Committee explained that the $1.56billion instrument was not a loan but a proposed forward sales agreement to enable the NNPC settle outstanding debt obligations.
Lending credence to this position, Mr. Adeola explained that the sales agreement which is being brokered by four Nigerian banks namely First Bank, UBA, Eco Bank and Standard Chartered Bank is designed to enable NNPC reduce the debts accruing from petroleum products imports.
``The key idea is to enable NNPC immediately raise the sum of US$1.5 billion to pay down outstanding debts.
CONTINUES ON PAGE 1
5Cover Story
Non-performing loans and exposures The table below shows exposures to the banks as well as the
bad debts:
CONTINUED FROM PAGE4
8.6bn
1.117.6bn
183M
3.373bn
1.08bn
EXOSURE (N) NON-PERFORMING LOANS (N)
Oil & Gas PowerOil & Gas Power
Bank
First Bank
ZenithBank
UBA
FCMB
SterlingBank
FidelityBank
WemaBank
DiamondBank
UnityBank
GT Bank
2011
386.93bn
153.49bn
151.3bn
97.45bn
44.43bn
24.54bn
8.7bn
78.16m
4.75m
168.9bn
2010
266.62bn
123.238bn
110.72bn
66.92bn
18.41bn
22.06m
8.17bn
63.27m
22bn
8.79bn
5.53bn
164.27bn
2011 2010 2011 2010 2011 2010
14.23bn
759m
1.86m
1.125bn
2.32bn
14.59bn
4.19bn
17.46bn
35.6bn
5.05bn
38m
2.43m
4.4bn6.57bn
1m
3.79bn1.47bn
1.74m 2.13m
3.03bn
11.83bn
0.2743m
27.9m
0.085m
27.7m 965.9m
0.05m
Source: Financial Statement
However, a number of banks refused to disclose their exposures in their reports. They are Access Bank Plc, Union Bank Nigeria Plc and Skye Bank Plc, which made no mention of loans extended to oil and gas firms in their 2011 financial statements, while the financial statements of Standard Chartered Bank and Citibank could not be accessed, as they are not listed on the Nigerian Stock Exchange.
A l s o , t h e f i n a n c i a l statements of Keystone Bank, M a i n s t r e e t B a n k a n d Enterprise Bank could not be accessed due to the fact that t h e y a r e n o t p u b l i c companies.
An analyst who spoke on the condition of anonymity, said Access Bank, Union Bank and Skye Bank inability to give out loans to energy firms in their 2011 financial year, may be as a result of fear and weak risk management structure.
The analyst is of the view that the banks, coming out from the crisis in the sector without been swallowed, might decide to t read cautiously in advancing loans, so as to avoid a repeat.
The analysts further stated that most of the banks are yet to put in place a strong and
effective risk management structure, a factor which m i g h t a f f e c t t h e i r advancement of loans to certain high-risk sector of the economy.
AMCON bars banks from loaning to chronic debtors
The CBN and AMCON late last year ordered banks to stop giving out loans to i n d i v i d u a l s a n d organisat ions who are indebted to banks to the tune of N5 billion and above.
In the list released by the CBN and AMCON, 20 oil and gas firms were credited with N705.885 billion while five power firms owed N114.928 billion.
It is expected that a significant reduction will be recorded in the banks’
lending to oil firms, when t h e i r 2 0 1 2 f i n a n c i a l statements are released.
The impending reduction in local banks’ exposure to oil and gas, and power firms has raised concerns about how these firms will finance their operations.
Analysts are of the view that the oil firms might have to resort to offshore financial institutions or multilateral financial agencies to finance their operations, and if the issue is not addressed soon, Nigeria’s oil output and local supply of petroleum products wil l l ikely be affected negatively.
Already, the Nigerian Association of Petroleum Explorationists, NAPE, had declared that Nigeria’s potential of generating about
2.26 million metric tonnes of liquefied petroleum gas, LPG, annually will not be achieved, unless the country addressed the issue of infrastructure deficit and lack of access to finance by players in the oil and gas sector.
In a presentation by Mr. Mustapha Jibrin, at one of its c o n f e r e n c e s , N A P E maintained that financing is critical, especially as it is evident that the country’s Vision 20:2020 objective can only be achieved with a stable power supply, with gas production playing a critical role.
He stated that recent gas discoveries in other parts of Africa were already affecting N i g e r i a ’ s n a t u r a l g a s potential and its global competitiveness, adding that increased access to finance a n d i n f r a s t r u c t u r e development wil l help reverse this trend.
H e s a i d , “ T h e competitiveness of Nigeria’s n a t u r a l g a s a n d t h e numerous opportunities to monet i se i t would be i m p a c t e d b y r e c e n t discoveries of large reserves of gas in other parts of Africa, especially offshore East Africa, as well as huge exploitations of shale gas in different parts of the world.”
Also speaking, Mr. David Adonri, an economic expert, expressed concerns over the huge exposure of the banks to energy firms in their current financial statement.
He said the Nigerian petroleum industry is not viable, especially due to the delay in the deregulation of the sector and government control of the sector.
He added that financing power and oil and gas projects with bank loans is a mismatch, due to the long term nature of such projects and the short term nature of bank loans. “It is disturbing to hear that banks are still exposing themselves to the petroleum industry in such a manner that could threaten their existence.
“Those affected have failed to learn from the past. Any bank over-exposing itself to the petroleum industry does so at its peril because government’s control of that sector is a recipe for commercial failure.
“The petroleum sector can only become viable when it is completely deregulated and privatised. If the balance sheet of any bank is damaged as a result of excessive risk taking, CBN and NDIC
should liquidate it and the management made to pay for their recklessness.
“Considering the short maturity profile of banks’ deposit liabilities in Nigeria, it is inconceivable that they will venture into financing Electric Power projects which by nature are long term. The mismatch in financing will definitely result in bad debt. Electric Power infrastructure r e h a b i l i t a t i o n a n d d e v e l o p m e n t r e q u i r e s medium to long term funds which are obtainable from the Capital Market and D e v e l o p m e n t F i n a n c e institutions.”
CBN’s intervention The challenges faced by the
banks between 2009 and 2011, when the CBN sacked the management of five banks and nationalised three of the banks were brought about by the inability of the oil firms to pay their debts following the crash in the prices of crude oil in the international market. This was in the wake of the global financial crisis and the credit c r u n c h i n t h e g l o b a l economy.
The CBN said the troubled banks had huge portfolio of non-performing loans, far above the figures allowed by law, in addition to other irregularities recorded in the banks.
The industry regulator also s a i d t h e b a n k s h a d difficulties in meeting their obligations to customers and other stakeholders and were constantly on ‘life support’, continuously accessing the Expanded Discount Window, EDW, for funding.
When the CBN moved against the five banks, August 2009, it said the total loan portfolio of the five banks was N2.802 trillion. Margin loans amounted to N 4 5 6 . 2 8 b i l l i o n a n d exposure to Oil and Gas was N487.02 bil l ion, while aggregate non-performing loans stood at Nl.143 trillion representing 40.81 per cent.
T h e C B N s a i d f r o m information at its disposal, it is evident that the five banks a c c o u n t e d f o r a disproportionate component of the total exposure to capital market and oil and gas, thus reflecting heavy concentration to high risk areas relative to other banks in the industry.
After the CBN’s efforts at sanitizing the banks and cleaning up their books, the banks have resumed lending to the energy sector, however, with extreme caution.
The CBN said the troubled banks had huge portfolio of non-performing loans, far
above the figures allowed by law, in addition to other
irregularities recorded in the banks
Oil 6
Oil &FELIX ANYANROUH
The Challenges of the Nigerian Electric Power Sector Reform (2)
Part one of this article reviewed the history of liberalization of Nigeria’s electric
power sector from 1896 to the present, noting that the capacity shortage
nevertheless remains pervasive.
Nigeria like many countries of the world provides subsidies for the electricity power
sector explicitly or implicitly, to producers and consumers. Justifications for their use
vary from social welfare protection, job creation, the encouragement of new sources of
energy supply, and economic development to energy security. Consequently, the
government is faced with formulating a tariff structure to incentivize power generation
and distribution on the one hand and social implication of market determine by
subsidies for those at an economic disadvantage position on the other.
The government should be concerned with the effect of subsidies to increase of
output capacity, and the encouragement of private participation. It is undeniable that
with the revised 2012 tariff structure, Nigeria has one of the median electricity rates in
the world. In mid 2012, NERC increased electricity tariff at a rate of N11 and N12 for
middle class consumers. Highest income consumers living in areas designated as R3
and R4 paid higher rates – as much as N23.71/kwh with fixed meter charges of
N21,256.30 and N118,830.56 respectively. This cost-reflective tariff regime is crucial to
the recovery of expansion and efficiency in the sector - get market signals right so that
prices can reflect the true cost of producing and consuming power.
Preferred bidders for distribution companies was carried out and awarded late last
year. There were allegations of misdeeds in the bidding process. It was alleged that
political brinkmanship was exercised in the process - past political and military leaders
were the beneficiary of the process. It was also alleged that the process was not
transparent. Prof. Bart Nnaji – then Minister for power lost his job in the process.
The issues of transparency and political will were also raised on the contracting of
transmission rights. The deal is reported to have been contracted to a Canadian firm
Manitoba Hydro Power at a cost of about $ 23.7million or N 3.7billion. The company
was expected to have formally assumed control of the Transmission Company of
Nigeria operations on Monday, July 30. Although there were some roadblocks to the
execution of the contract, Manitoba is set to take over control of transmission in Nigeria
It is axiomatic (and supported by the empirical evidence) that corruption discourages
private investment, retards growth and inhibits poverty reduction efforts. In the energy
sector for example, the delivery of energy moves from generation to transmission, to
wholesale distribution and finally to retail distribution. Corruption can occur anywhere
along the line. In generation, for example, it can occur in the licensing stage – where
government officials might be tempted to ask for kickbacks in the issuance and renewal
of generation licenses. Also, contracting for Power Purchase Agreements with state
entity including payments for power generation can attract corrupt practices.
Furthermore, management of public finance is crucial to sector performance. For this
reason, there are frequent attempts to explore vulnerabilities on both the expenditure
and revenue sides of public finance. Due to the intricacies involved, budget
management is frequently afflicted with inefficiencies and corruption. This can take
the form of diversion of budgetary allocations towards activities that have greater
potential for kickbacks, bribery, and fraud or theft. In the energy sector for example,
this can occur in both the legislative and executive arm of government – budgetary
approval process for the electricity power sector in the allocation of subsidies,
procurement etc.
A close examination of Nigerian electricity sector reforms suggests that corruption
was a major factor in the cycle of failure, inefficiencies and capacity shortage. It is a
public fact that the Nigerian society is plagued with serious corruption, hence the
creation of the Economic and the Financial Crimes Commission (“EFCC”) and the
Independent Corrupt Practices and Other Related Offences Commission (“ICPC”) to
fight this vice. The EFCC until recently was very effective in fighting graft and financial
crime in Nigeria.
The liberalization of an electricity power sector can be a cumbersome process whose
impact can be viewed as both short-term as well as long-term in nature. At the same
time, the success or failure can only be measured by past mistakes and corrective
measures. The concerns about the liberalization process in capacity-short countries
have centered on the process followed, the transition management and the final
destination of the reform process.
As will be readily apparent from the foregoing discussions, a tremendous amount of
effort and resources - both institutional and regulatory - have been brought to bear on
liberalization as a panacea for a capacity deficient electricity power sector. Yet, the
problems persist. The question, then, is why? It is the author’s opinion that at every
stage of the liberalization process a constant theme is the issue of corruption. To
advance the liberalization process towards its laudable objectives, this author offers the
following recommendations:
? A robust and radical reform in the sector demonstrating changes to improve
and strengthen both the regulatory and institutional framework to enhance
accountability and minimize corruption;
? Adequate incentives for investors and a climate of predictability, through
consistency in formulation and execution of policy.
? The country should immediately establish a permanent, special unit of the
EFCC - dedicated to the Petroleum and Electricity Power sector, with independent
powers of investigation, arrest, and prosecution in all instances of corruption in the
sector, without recourse to the Ministry of Justice. Such a draconian approach is
justified: after all, this sector is the lifeblood of the nation.
ABREC, USAID sign MoC on clean energy financing
Clara NWACHUKWU
African Biofuel and Renewable E n e r g y C o m p a n y , ABREC, and
Nexant Inc., a United States Agency for International D e v e l o p m e n t , U S A I D initiative, have signed a M e m o r a n d u m o f Cooperation, MoC , for the promotion of Clean Energy Financing in West Africa.
A USAID statement made available to Sweetcrude last week indicated that the MoC was signed on January 18, 2013, adding that the two bodies will be responsible for implementing the Regional Clean Energy Investment Initiative, RCEII, in the sub-region.
Under the terms of the cooperation, which was s i g n e d b y t h e C h i e f Executive Officer, ABREC, Mr. Thierno Bocar Tall, and Vice President, USAID’s Nexant, Dr. Peter du Pont, the two organisations will be responsible for:
? Creating a regional base of support for Private F i n a n c i n g A d v i s o r y Network, PFAN, in West Africa, and will contribute to the development of a PFAN network of partners and o t h e r i n t e r e s t e d stakeholders;
? S u p p o r t i n g t h e development of a pipeline of clean energy projects for consideration by investors in West Africa region through a Call for Proposals, CFPs;
? O r g a n i s i n g , promoting and hosting the West African Forum for Clean Energy Financing, WAFCEF, this October in Accra, Ghana, where projects selected for the CFPs will be presented by their respective developers to investors and financiers;
? Mentoring selected projects by offering pre- WAFCEF introductions to inves tors , and pos t – WAFCEF deal-flow sessions. Selected projects will be offered technical assistance to develop financially viable business plans, which will be
presented at the WAFCEF; and,
? P r o m o t i n g discussions on clean energy pol icy and knowledge sharing.
T h e c l e a n e n e r g y investment initiative is a key part of USAID’s global effort to promote low emissions development strategies.
According to the promoters, the RCEII is a three year programme designed “to support the expansion and strengthening of PFAN in West Africa,” adding that it “applies the methodology of identifying early stage projects suitable for private sector f inance and by providing mentoring and advisory services to help guide these projects for financial closure.”
The Lome, Togo-based, ABREC is an initiative of the World Bank; the ECOWAS Bank for Investment and D e v e l o p m e n t , E B I D ; Nigeria’s International Energy Insurance, IEI; the ECOBANK Development Corporat ion EDC; the “Fonds African de Garantie e t d e C o o p e r a t i o n Economique”, FAGACE; the Nigerian Export-Import Bank, NEXIM; and a host of other donor partners to promote renewable energy and low carbon industry in Africa.
The company also manages the Africa Clean Energy Technical Assistance Facility, and engages regularly with governments and other stakeholders to encourage renewable energy and policy development and policy harmonisation.
USAID on the other hand, supports programmes that reduce greenhouse gas, GHG, emissions and achieve m u l t i p l e n a t i o n a l development objectives, including enhancing energy s e c u r i t y , i n c r e a s i n g industrial competitiveness, expanding private sector investment, supporting economic growth, and alleviating poverty.
7Oil
Mexicans
Derivation: Mexico encourages higher wealth distribution
Clara NWACHUKWU
On e o f t h e
fallouts of the
just-concluded
13th Annual
Nigeria Oil and
Gas , NOG In ter na t iona l
Conference and Exhibitions is
the issue of derivation, with
Mexico, a top oil producer
advocating for higher derivation
to resource rich areas.
A former Undersecretary for
Hydrocarbons, Republic of
Mexico, Mr. Mario Gabriel
Budebo, who was the speaker for
the Leading Light Session
sponsored by ExxonMobil
Companies in Nigeria, told the
audience that derivation to host
communities in his country is
between 30 and 35 percent of the
total oil revenues.
Budebo, in response to a
question on how the oil wealth is
distributed in Mexico in order to
compare notes with Nigeria,
said, “With regard to wealth
distribution between 30 and 35
percent goes to the oil producing
states and the remaining 65
percent is distributed among all
the municipals based on the size
of the population.”
He added the figures may go
even higher, as currently
discussions were ongoing in
Mexico, as to how to distribute
the new productions recorded in
the recent times.
His response attracted a loud
ovation from the audience,
especially as the issue of
derivation has remained a
knotty one in the Nigerian
polity, with the Northern region
complaining that the current 13
percent allotted to the Niger
Delta states had placed these
states above them, thereby
creating not just uneven
distribution of resources but also
impeding general pace of
development of the regions in
the country.
Indeed, one of the main
o b j e c t i o n s a g a i n s t t h e
Petroleum Industry Bill, PIB,
undergoing scrutiny at the
National Assembly, is the
proposal to establish additional
10 percent equity fund to the oil
communities, a move the
Northern states have sworn they
will not support.
Shared experience
In his introduction of the
s p e a k e r , t h e C o u n t r y
Chair/Managing Director,
ExxonMobil Companies in
Nigeria, Mr. Mark Ward,
explained that the purpose of
the session, “… is to bring
greater perspectives on how to
make Nigeria’s oil and gas
i n d u s t r y m o r e g l o b a l l y
competitive, and to determine
what it takes to become globally
competitive.”
He added that Mexico, also a
developing country, had also
gone through s imi lar o i l
exploration and exploitation
experiences like Nigeria, and to
see what possible lessons that
could be learnt from these
experiences.
These, Ward said, would help
Nigeria tremendously, especially
now as the petroleum industry in
undergoing major reforms, which
could make or break it globally.
Mexican oil and gas reforms
Budebo, who spoke on, “Oil and
Gas in Mexico: Evolution, Legal
C h a n g e s a n d F u t u r e
Opportunities,” took a historical
detour of petroleum development
in his country, saying that oil
production had gone on for well
over 70 years before reforms
began in 2008.
He added that before it came,
the process took about two years
of fine-tuning before it became
acceptable.
He recalled: “Mexico’s
petroleum history dates from the
beginning of the twentieth
century. At the time, concessions
were given to international
companies to explore the territory
and produce petroleum: First
under the ownership of the
landowner, and after 1917, under
the ownership of the Nation,
paying a special tax.
“During the fir st quarter of the
20th century, oil production in
Mexico increased significantly.
By 1921, Mexico was the second
largest producer in the world,
contributing with 14% of total
w o r l d p r o d u c t i o n ; w i t h
approximately half a million
barrels a day.”
Budebo further observed that
the period was “the first time in
Mexico that a public forum was
created by Congress to discuss a
reform<’ adding that it was
accompanied with “A very
through media campaign.”
According to the former
Mexican Hydrocarbon boss, the
reforms brought about stronger
regulatory policies for the
petroleum industry, which were
based on four main broad
objectives with a view to making
the industry more market
oriented:
? N e w c o r p o r a t e
governance - Integration of
independent non executives
directors and new attributions to
the Board.
? A l i g n m e n t o f
incentives - Mandate for value
c r e a t i o n ; d e f i n i n g
responsibilities; payroll linked
to performance; greater public
informative requirements, and
citizen bonds.
? Execution capacity -
New contracting scheme for
greater participation of the
private sector. More risk
oriented contracts, and,
? M a n a g e m e n t
autonomy - Application of
excess revenues, approval of
budget ad jus tments and
freedom for internal structural
organisation.
He concluded that for the
reforms to be as successful as
expected there was the need for
the state oil company, Pemex to
demonstrate greater market
discipl ine, which echoes
Nigerians desire for the
Nigerian National Petroleum
Corporation, NNPC, while also
emphasising the need to
improve transparency and best
acquisition practices and a host
of others.
He maintained: “The new
reform should include deeper
changes that allow more open
conditions for the participation
of private companies, as well as
more autonomy to Pemex, under
a market discipline scheme that
gives the company a larger set of
tools to perform in this new
environment.
“Such changes would boost
investment in the sector,
bringing employment and
economic growth to the country.
A new petroleum reform under
these lines, would result in
higher operating efficiency,
“Mexico’s petroleum history dates from the beginning of the twentieth
century. At the time, concessions were given to international
companies to explore the territory and produce petroleum: First under
the ownership of the landowner, and after 1917, under the
ownership of the Nation, paying a special tax
lower costs, faster incorporation
of new technologies and, as a
result, increased economic rent
for the benefit of the country.”
8Oil
PCMN manufactures protective coating for vessels, others… Calls for support to enhance capacity
Clara NWACHUKWU
Indigenous company, Paints and Coatings M a n u f a c t u r e r s Nigeria Plc, said it has been awarded the sole
manufacturing rights for the manufacture of protective coatings by International P a i n t s i n N i g e r i a . International Paints is reputed as the biggest manufacturer of oil and gas, and marine paints in the world.
S p e a k i n g o n t h e development on the sidelines of the recently concluded N i g e r i a O i l a n d G a s Conference in Abuja, the company’s Chief Executive Officer, Mr. Mike Thompson, told Sweetcrude that with this feat, the company’s staff strength has increased from 13 at inception to current 130. Only five of these are expatriate staff.
Thompson also revealed that the Nigerian Stock Exchange, NSE-quoted company now manufacturers about 95 percent of such paints used for corrosion p r o t e c t i o n a n d o n l y complements it with about five percent imports
The protective paints are used for the covering of floating production storage and o f f l oad ing , FPSO vessels, platforms, buoys, o t h e r v e s s e l s , t a n k s , refineries and a host of others, while also carrying out facilities upgrade.
He said that getting quoted on the NSE meant that the company moved up from 60 percent foreign ownership to now 70 percent Nigerian ownership since it got listed on November 2, 2010.
He further disclosed that the company is also involved in project management, t e c h n i c a l s u p p o r t b y undertaking inspections throughout the tenure of the project, procurement services relating to plants, tools, equipment and consumables for coating projects as well as training.
Thompson explained that with regard to training, PCMC “offers formal training a n d c e r t i f i c a t i o n o f application personnel in the fields of coatings, painting, b l a s t - c l e a n i n g a n d supervision,” adding that all
its courses are globally ce r t i f i ed by the UK’s I n d u s t r i a l C o a t i n g s Applicator Training Scheme, ICATS.
He said that PCMN in October 2011, became the first training centre for ICATS in Africa. “We are also Oil and Gas Trainers Association of Nigeria, OGTAN-registered, a n d w i t h o u r I C AT S certification, anyone trained by our company can work in the United Kingdom, UK,” he added.
Growth challengesSpeaking on the operating
environment challenges, the company’s Chairman, Chief Sylverius Okoli, said all that the company needed to enhance capacity utilisation still as low as 20 percent is greater support from the Federal Government and the International Oil Companies, IOCs.
H e s a i d t h e l o c a l l y manufactured paints are at a disadvantage because of the imported cheaper paints. He argued that if government could impose higher duty on these imported protective c o a t i n g s , t h e l o c a l l y manufactured ones would be able to compete more favourably.
In addition, Okoli noted that if the IOCs, in line with the Nigerian content policy are able to source their protective coating locally for their various operational equipments, it will go a long way in boosting indigenous capacity.
He noted that all the protective coating used by
the IOCs for the buoys, platforms, FPSOs and other vessels are all imported, mainly from the Asian tigers, who build these facilities, thereby increasing capital
flight from the economy but a l s o e x p o r t i n g h u g e employment opportunities.
He said, “Government can raise duty on oil and gas paint products from the current 20 percent to about 80 or even 100 percent duty to create a level playing field for all
operators. If this happens, we not only will be able to generate hundreds of more employment opportunities, but also we will be able to compete globally. Beyond
these, we can even export not just our expertise but also our products to the sub-region and beyond.
T o q u a n t i t y w h a t government and IOC support can do for the company, the chairman noted that last year, PCMN was the largest growing stock on the NSE. “We went from 52kobo per share to N1.91k at the close of trading in 2012.”
With such high prospects, he said the company wants “to focus more on providing all the protective coatings required for the oil and gas industry including FPSOs, and LNG vessels .” He added that despite the high cost of the locally manufactured products, the value addition is higher in terms of “ p a y m e n t o f t a x e s , employment generation and i n - c o u n t r y c a p a c i t y building.”
Besides, he noted that the pay back for the additional costs is less than a year because of the spiral effects in the economy.
Marine line 784 was recently used to coat the fuel oil tanks on the new Vicem Mega-Yacht
The protective paints are used for the covering of floating production storage and
offloading, FPSO vessels, platforms, buoys, other vessels, tanks, refineries and a host of others, while also carrying out
facilities upgrade
9Oil
NCDMB, Amnesty collaborate on employment of ex-militants
Th e N i g e r i a n C o n t e n t D e v e l o p m e n t and Monitoring Board (NCDMB)
and the Presidential Amnesty Programme have begun to work together towards c r e a t i n g e m p l o y m e n t opportunities in the Oil and Gas Industry for ex-militants w h o h a v e u n d e r g o n e s p e c i a l i z e d t r a i n i n g programmes.
The Executive Secretary, NCDMB, Engr. Ernest Nwapa and the Chairman of the Presidential Amnesty Programme, Mr. Kingsley Kuku confirmed this in Abuja while speaking at the just concluded Nigerian Oil and Gas Conference. Mr. Kuku was represented at the event by his Special Assistant, Mr. Lawrence Pepple
Over 1,498 ex-militants underwent various training programmes in foreign locations such as South Africa, Ghana, Cyprus, Dubai, with some of them specializing in practical Oil and Gas disciplines.
C o n f i r m i n g t h e collaboration, the Executive Secretary said the Board is working with all stakeholders of the industry under the strong leadership of the Honourable Minister of Petroleum Resources, Mrs. Deziani Alison-Madueke to domicile more work in-country and deepen the capacity of the local supply chain to execute complex industry work, thereby creating more opportunities for employment of qualified Nigerians.
Nwapa stated that major o p e r a t i n g c o m p a n i e s , including the Nigerian N a t i o n a l P e t r o l e u m Corporation cannot employ more than 50,000 Nigerians as they had outsourced most of their operations, adding however that the industry was capable of creating thousands of jobs through the execution of its jobs in-country.
“We are pulling the industry together because they have capacity to create new shop floors and it is only where there are jobs that training can thrive and succeed,” he said.
H e i d e n t i f i e d t h e m a n u f a c t u r i n g o f components of various equipment used by the industry as the segment that will unlock thousands of productive job opportunities f o r y o u n g N i g e r i a n s , including ex-militants.
The Executive Secretary further advised that “When
the ex-militants come back, they should not be kept together. Instead, we will take them in twos or threes and inject them into projects as ordinary Nigerians, without them having tags as ex-militants.
Nwapa also counseled the Amnesty Office to manage the expectations of the ex-militants about the Oil and Gas industry, indicating that “contracts in the Oil and Gas industry run for 18 to 20 m o n t h s , a f t e r w h i c h companies start disengaging workers who will be expected to seek fresh employment in companies that have got new projects.”
“We need to increase shop floor space and encourage manufacturing through the help of the international operating companies. We also need to educate the ex-m i l i t a n t s t h a t t h e i r employment lies in the manufacturing facilities.”
c c o r d i n g t o t h e AExecutive Secretary, the ex-militants and other young Nigerians would also benefit from the Capacity B u i l d i n g I n t e r n s h i p Programme, which the Board h a d b e g u n w i t h t h e Pe t r o l e u m Te c h n o l o g y Associat ion of Nigeria (PETAN).
Under the programme, PETAN will recruit qualified Nigerians and expose them to various training and skills development workshops and on- the- job t ra in ing to
prepare them to work in the course of contracts and gain employment.
PETAN companies will then absorb the trainees once they win the contracts and retain them after the internship p h a s e b a s e d o n t h e i r performance.
In his comments, Mr. Lawrence Pepple harped on t h e n e e d t o p r o v i d e employment opportunities for the ex-militants after their training, to ensure that they do not slip back into nefarious activities.
He warned that if the militants were not properly engaged, the next phase of
militancy will be fused with intellect and skills because the ex-militants are being trained in the best facilities on s h i p b u i l d i n g a n d maintenance, welding and fabrication etc.
He said, “Although they may not be properly certified, they
can be made to learn on the job and become better. If you don’t give them jobs when they return, they will be more sophisticated and this will be a very serious problem.”
Admitting the guidance they receive f rom the Executive Secretary, Pepple pleaded with the industry to guide the Amnesty Office on what is required to meet their standards.
He also confirmed that the A m n e s t y O f f i c e h a d uploaded the database of trained ex-militants unto the Nigerian Content Joint Qualification System.
*Govt wades in,
suspends further
sales Emma Amaize
Communities infringe on Warri Refinery land
ARRI Refining and
Petrochemical Company, WWRPC, Warri, Delta State, has
complained about alleged
encroachment on its property
by Ifiekporo and Ijalla
communities to the Delta State
Government.
A source said part of the land
in question have even been
sold by some persons in the
communities, a development
that made the state governor,
Dr. Emmanuel Uduaghan, to
direct the Commissioner for Oil
and Gas, Hon. Mofe Pirah to
step into the matter and report
back urgently to him. At a
meeting with leaders of the
communities, Hon Pirah
warned that government would
not condone infringement on
government lands by
communities. He told them
government received a petition
from WRPC, a subsidiary of
NNPC that Ijalla and Ifiekporo
communities have encroached
on their acquired land.
Pirah said the Ministry of
Land had been directed to
survey the land based on
available land documents of the
area and determine the actual
boundary. The commissioner
asked the communities to
inform those that bought the
disputed land to attend the next
meeting to be informed of the
development. He said
information at his disposal
showed that WRPC decided not
to fence the landed area
because the matter was
pending in court and wondered
why the communities were
selling part of the land.
Government, therefore,
ordered suspension of activities
on the land until the next
meeting when the Ministry of
Lands was expected to have
completed its assignment on
the boundary between WRPC
and the communities.
Mrs. Pauline Avose, who
represented the Ministry of
Lands at the meeting, said the
ministry would comply by the
resolution, while the leader of
Ifiekporo Community, Mr.
Monday Akpeyi said WRPC did
not inform the community that
it was encroaching on its
property. He, however, said the
community was prepared to
abide by government’s
directive.
“When the ex-militants come back, they should not be kept together. Instead, we will take
them in twos or threes and inject them into projects as ordinary
Nigerians, without them having tags as ex-militants.
10Gas
… Grants 5yr tax holiday, production allowance
PIB: FG grants special incentives for gas
Ev e n a s t h e
execut ive and
l e g i s l a t u r e
s t r u g g l e t o
harmonise some
contentious fiscal issues and
other grey areas in the Petroleum
I n d u s t r y B i l l , P I B , t h e
development of the nation’s gas
resources as being proposed in
the bill will remain non-
negotiable.
Government is also willing to
grant a five-year tax holiday as
an added incentive for domestic
gas production as well as a
production allowance worth up
to 100 percent of prevailing gas
prices in order to fast-track the
development of Nigeria’s
natural gas resources, which
reserves are put at about 187
trillion cubic feet.
A member of the PIB technical
C o m m i t t e e , M r. A b i y e
Membere, who made the
clarification in one of the
sessions at the just-concluded
Nigeria Oil and Gas, NOG 2013
International Conference and
Exhibition in Abuja, noted that
before now, gas development
was almost non-existent.
This is because in the past, the
discovery of gas was treated as
an incidental, and no conscious
effort was made to exploit the
natural resource, despite the
millions of dollars doled out by
government to the international
oil companies, IOCs, to do so.
The development led to the
continued flaring of gas with no
end in sight, as opposed to
global initiatives to make the
environment less contaminated.
Membere, who is also the
Group Executive Director,
Exploration and Production,
Nigerian National Petroleum
Corporation, NNPC, however
maintained that this will no
longer be the practice in the
current dispensation.
More incentives for gas
producers
Reacting to the clamour for
more incentives by the IOCs,
Membere: “Today, we hear the
incentives are not enough. In
the past, we were giving out
money as an incentive for gas
development. We gave out
cheques to people just for them
to develop gas, but where are we
today? We have changed the
deadline for gas flare out many
times. Even before you finished
your gas project, you have
collected your money for gas.
Government was dishing out
money free to those who wanted to
develop gas.”
Explaining the wisdom in
higher tax and lower royalty, he
said:”Nigerian gas, based on what
we have today, is not that bad with
respect to liquid. All we are trying
to do is to compensate the
increase in tax with decrease in
royalty. Royalty is a front line
action; it has a long way of
gapping the equivalent tax you
pay. So, we reduce royalty to
compensate for that gas. Addition
to that , for domest ic gas
production, there is a five year tax
holiday. Five years are typical
years where projects are being
amortised. If you have a project
that you spent $100 million, it is
expected that you amortise it in
five years, which is $20 million
each year. You will have that as a
tax holiday.
“In addition to that, we
i n t r o d u c e d p r o d u c t i o n
allowance. For you to produce
gas, there is an amount of money
that the government will give to
you back. In some cases,
depending on the type of
production, you get 100 per cent,
more or less, the price of gas.
Take for instance for smaller
field, you get a production
allowance of up to $2 per 1,000
cubic feet. It is for you to get that
drive to supply gas to the
domestic market. With the
combination of these incentives
to the fiscal regime, we strongly
believe that gas projects will get
minimum rate of return that may
encourage investors to come.
Harmonising issues
Membere said part of the plan
is to harmonise oil and gas
development, saying, “One of
those things, which are gaps
currently in the Petroleum Act -
the separation of oil from gas.
Over the years, gas development
was actually not in existence.
People just take the oil and leave
the gas, which is why we are
where we are today.
“So, the current thinking is to
harmonise the tax regime for oil
and gas so that when somebody
is looking for oil and knowing
that the oil does not flow alone
but it comes with the gas, he has
to plan for the gas. So, in a
situation where you are having
development, it has to be an
i n t e g r a t e d o i l a n d g a s
development strategy and no
longer oil strategy, which used
to happen. Because it used to be
different in the Petroleum Act,
we had to give separate
incentives for gas development.
With harmonisation, he
argued that operators will begin
to treat gas finds more seriously
than they had previously, while
also distinguishing between
associated gas and non-
associated gas . “On the
associated gas, you can leverage
on the oil. On the non-
associated gas, you do not have
anything to leverage on,
especially when the gas is dry.
When the gas is wet, the liquid is
actually dried for sustainability.
“We fully understand that one
of the key drawbacks in gas
d e v e l o p m e n t i s l a c k o f
infrastructure. Government has
taken a bold step in ensuring
that key infrastructures like
trunk line, Ob/Ob-Oben East
West gas pipeline, which is
going to link the gas between
the east and the west, is in place.
The Ajaokuta-Kano-Katsina
line, which is another major key
infrastructure that is going
towards the north, is also in
place.”
Other incentives
Membere further disclosed
that part o f the special
incentives for gas development
as being proposed in the
granting of open access to
infrastructures, especially for
the small producers. “One
additional aspect of this is the
open access policy in gas, where
small producers that are lacking
all these infrastructures do not
go back in developing high cost
and high value types of
infrastructures before they can
produce gas.
Irrespective of what the price
of gas is at the international
market, which is determined by
USA, he argued that gas
producers will not run at a loss
as long as the domestic market is
adequately supplied. He said
that this will among others,
“ensure that there is constant,
reliable and sustainable power
in this country. That is going to
s t i m u l a t e t h e g a s f e e d
industrialisation that we are
talking about.”
Gas plant
11FeedbackFeedback
Transparency, accountability issues in derivation
The last has not been
heard concerning
the agitation by
several groups, to
have direct control
of the 13% derivation, paid to
state governments of oil-
producing areas, with the aim of
d e v e l o p i n g o i l - b e a r i n g
communities.
In Delta State, where most of
the exploration of oil & gas is on-
shore, the agitation is now
a m o n g s t - f a m i l y, v i l l a g e ,
community, clan, ethnic and
other interest groups.
Prince Emmanuel O.Oyibo,
C o m m a n d e r , E t h n i c
Communi t ies Secur i ty, a
member of Federal Ethnic
Council of Nigeria, is appealing
to all Security Agencies to
ensure that they do not allow
themselves to be used by the
corrupt politicians to sabotage
the efforts of President Goodluck
Jonathan for sustainable peace
and development and to keep
their eyes watching for them not
to run away from the country.
Prince Onyibo is making this
plea, so that, public office
holders to can an account for the
funds including the 13%
derivation funds, received by
Delta State as well as other oil
States to the people of Oil
Communities at the grass root
level through the ethnic council.
The counc i l wants the
presidency to ensure probe of the
funds starts immediately before
the end of March 2013, and
ethnic communities’ security to
unite, ensuring accountability
and payment of the funds
requested at July 2012 for the
ethnic communities’ security
outfits. The federal Government
should also make the release of
the monthly 250m from the 50%
of the 13% derivation funds,
while discussing the derivation
and the (P.I.B).
“The 50% of the total allocation
coming to Delta State monthly
from the Federation account
which is supposed to be for the
Oil Producing Communities is
what we are talking about first,
w h i l e o t h e r d i s c u s s i o n
concerning the 13% derivation
setting up the Board when it will
come to conclusion,” Prince
Onyibo added.
But, the Governor of Delta
State has spoken strongly
against the agitation for the
remaining 50% of the 13%
Derivation, paid to the state,
which he avers is being used in
developing other areas of the
state, advising anyone who is not
satisfied with arrangement, to
approach the proper court of law.
The council, represented by
Prince Onyibo, wants the total
allocation to the Oil producing
States to be managed by
m e m b e r s o f t h e c o u n c i l
representing their ethnic
nationalities but not the Oil
Commission created by the state
government.
T h e c o u n c i l t h e r e f o r e
demanded Chief Willington
Okirika and his team to give
account of their stewardship,
following allegations of a
missing N79billion, adding that
until they do, “They should not
parade themselves as leaders on
the issues of 13% derivation and
the PIB. Failure to do so will be
penal ized by the Ethnic
Communities Security and
handed over to the Presidency.”
St ra tegy fo r sus ta ined
competitive advantage
In order to address the need to
enhance the leadership capacity
of African senior executives,
These Young Minds and Aston
Business School have partnered
to offer a four-day executive
educat ion programme on
strategy for a sustainable
competitive advantage.
The organisers in a statement
made available to Sweetcrude
said the the programme,
http://theseyoungminds.co.uk/st
r a t e g y - f o r - s u s t a i n e d -
compet i t ive-advantage, is
unique in that it is specially
customised for African senior
executives from the public and
private sector, ensuring it reflects
contextual nuances and adds
immense measurable value for
p a r t i c i p a n t s a n d t h e i r
organisations.
The Executive Education
Director, Aston Business School,
Mr. Paul Butler, was quoted as
saying: “We have developed this
p r o g r a m m e t o p r o v i d e
participants with a great
opportunity to enhance their
capacities as strategic leaders.”
Also speaking about the
programme, Founding Executive
Director of These Young Minds,
Mr. Alim Abubakre, said: “The
p r o g r a m m e S t r a t e g y f o r
S u s t a i n e d C o m p e t i t i v e
Advantage combines tuition in
management that reflects the
contextual nuances o f a
developing country with a
platform for senior executives to
shape their organisational vision
w h i l e c h a l l e n g i n g t h e i r
assumptions. Through this
programme senior executives
would broaden their horizons,
enhance their ability to provide
strategic leadership, improve
their capability to anticipate and
manage the future and present
risks involved and maximise
their potential to harness
o p p o r t u n i t i e s f o r t h e i r
organisation in a sustainable
way”.
The statement also explained
that the bespoke programme will
offer attendees the tools to build
their own successful and
sustainable strategies. It will also
explore ways of mitigating
potential risks to the market
position of the attendees’
organisations. Participants will
also benefit from insights into
the current motivations and
future behaviour of competitors.
An exclusive working visit to a
high-profile global organisation
in Birmingham will also be
included.
The Sustained Competitive
Advantage programme will run
from June 10th to 13th, 2013. It
will take place at the Aston
B u s i n e s s S c h o o l , i n
Birmingham, UK, which is
amongst the top business
schools worldwide with triple
accreditation from EQUIS,
AMBA and AACSB (only 50
Universities globally have
attained this feat).
In order to address the need to enhance the leadership capacity
of African senior executives, These Young Minds and Aston
Business School have partnered to offer a four-day executive
education programme on strategy for a sustainable
competitive advantage
FocusF 12
World Energy Outlook and Potential Impact on Nigeria’s Petroleum Industry
NRC officials give the St. Lucie Nuclear Power Plant good safety ratings
Be i n g a t e x t
presented by the
C h a i r m a n /
M a n a g i n g
D i r e c t o r ,
ExxonMobil Companies in
Nigeria, Mr Mark Ward, at the
10th Aret Adams Annual Lecture
Series, organized by the Aret
Adams Foundation. Excerpt:
Mobil Producing Nigeria is
honored to join the Aret Adams
Foundation for what has become
a very important date in the
industry speaking calendar. I
commend the Board of the
Foundation for sustaining its
founding vision, and providing
this platform that brings industry
leaders together to address
critical issues associated with
our industry.
Our topic, “World Energy
Outlook and Potential Impact on
Nigeria’s Petroleum Industry”,
is probably as relevant as it will
ever be to Nigeria’s energy
industry, and all of us sitting in
this room.
ExxonMobil’s Outlook is a
comprehensive and detailed
assessment of the energy
landscape over decades. It is
part of the foundation on which
we have built our business. The
Outlook to 2040, as with past
analyses, is based upon a
combination of public and
proprietary data covering more
than 100 countries.
Global outlook
We look at world demand, the
types of energy needed to meet
that demand and other factors
that might impact energy supply
and demand on a global,
regional and national level.
These include things like
expanding prosperity among a
growing world population, the
cost and availability of various
f o r m s o f e n e r g y , t h e
development and use of new
technologies, and government
policies and regulations.
More recently, we have shared
it beyond our Board Room to
public audiences around the
world to broaden understanding
of the energy challenges and
opportunities all of us face in the
years ahead. This is even more
important for an energy rich, -
and energy dependent - nation
such as Nigeria.
It is important to understand
the links between population
growth, economic progress and
the amount and type of energy
used around the world. Growing
p o p u l a t i o n s a d v a n c e
economically over time and seek
better living standards, which in
general leads to increased
energy use.
We expect that by 2040, global
population will reach 8.7 billion,
and the Non OECD will make up
85 percent. Global GDP is
expected to increase at about 2.9
percent a year from 2010 to 2040,
led by the rapidly expanding
economies of the Non OECD.
Energy demand
The point here is that energy
demand, projected to grow
significantly through 2040, will
be driven mainly by population
and economic growth in the Non
OECD.
Since 2010, demand for energy
from the United States, Europe
and other OECD members is
being moderated as their
economies reach a plateau. Total
demand increases around 35
percent from 2010 to 2040, or
about 1 percent per year on
average.
Looking at trends by energy
type:
Oil remains the largest single
source of energy. Its use will grow
around 25 percent.
Oil, natural gas and coal
provide approximately 80 [82%
2010, 77% 2040] percent of total
supplies.
The most significant shift
occurs as natural gas displaces
coal as the second-largest fuel
by 2025. Gas will grow faster
than the other major fuels, with
demand up 65 percent by 2040.
This is important for an oil and
gas resource-rich country like
N i g e r i a a n d p r o v i d e s
c o n t i n u o u s i n c e n t i v e t o
implement competitive policy
regimes.
By 2040, we expect Asia Pacific
market will account for close to
45 percent of demand, up from
just 20 percent in 1980.
Here is some perspective on
how the recent surge in North
America’s domestic production
of oil and gas might impact the
global market.
T h r o u g h e x p a n d i n g
application of horizontal drilling
and hydraulic fracturing, the US
is tapping “unconventional” oil
and natural gas found in shale
and other “tight” formations,
leading to a dramatic shift in
North America’s demand and
supply outlook over the period.
We expect North America oil
demand to fall, primarily as a
result of improved efficiency in
transportation. This trend,
coupled with increases in liquid
supplies being developed in the
U.S. and Canada today, is
expected to lead to a significant
d e c l i n e i n n e t i m p o r t
requirements (shown in the dark
green-hatched area). In fact,
around the year 2030, we expect
North America to go from a net
importer to potentially a net
exporter of oil and oil-based
products. The point here is that
on balance, North America is
likely to move from a net import
position to a net export position
by about 2025.
Impact on Nigeria
In 2011, Nigeria exported
about 2.3 million bbl/d of crude
oil. The US is the biggest
importer of Nigeria’s crude, with
34% of export volume. Europe
(30 percent) and Asia (17
percent) follow closely.
However, exports to the US
from Nigeria have declined in
recent times, in favor of
domestically-produced crude.
In 2011, US import of Nigerian
crude decreased in volume
overall, with the trend sustained
in 2012. Reported shipping
schedules for this year show that
Nigeria cut exports in February
to 67 cargoes (about 2.19 million
bpd), compared with 75 cargoes
for January 2013.
So, will the changing supply
CONTINUES ON PAGE 13
It is important to understand the links between population
growth, economic progress and the amount and type of energy
used around the world
13Focus
World Energy Outlook and Potential Impact on Nigeria’s Petroleum Industry
dynamics in North America
impact Nigeria’s production? Is
the supply market constricting?
Not necessarily, as demand
remains strong in China and
India. But we expect competition
will tighten as exporters,
including Nigeria, seek new
markets outside of the US.
H o w e v e r, a s w e n o t e d
previously, the US is projected to
be one of the world’s largest
producers by 2020; driven by
f a s t e r t h a n e x p e c t e d
development of shale oil in
North America
According to the EIA, US oil
production in 2012 exceeded
seven million barrels a day - the
first time since 1993.
US oil imports are expected to
fall by more than 4MBD,
compared to current 10MBD
imports. The US will be a net
exporter of oil by 2030
In view of this emerging
scenario, where potentially, the
U.S. competes for the same
export market, with cheaper
shale oil, the obvious question
we should ask is, “‘what should
Nigeria be doing today”?
This is important, as the oil and
gas sector currently accounts for
over 95 percent of Nigeria’s
export earnings and about 40
percent of total revenues.
Natural gas d iscover y,
consumption
Let’s take a look at natural gas,
where North America’s shale
boom has had a more dramatic
global impact.
The remaining global natural
Shiroro dam
gas resources and projected
demand, as estimated by the
International Energy Agency is
more than 28,000 Trillion Cubic
Feet (TCF). But gas is an
a b u n d a n t , w i d e - s p r e a d
resource.
The gas resource is split into
c o n v e n t i o n a l a n d
unconventional gas, with
unconventional gas making up
about half the estimated
remaining resource. In North
America, it is higher – about two-
thirds of the remaining resource.
Access to North America’s
unconventional gas has shifted
global LNG market dynamics,
with new technology spurring
d o m e s t i c p r o d u c t i o n a t
significantly cheaper rates. This
will almost eliminate the need
for imports into North America,
and make more LNG available
to Europe and Asia Pacific.
We note also that global
consumption - shown in blue
bars – is projected to increase by
over 50 percent from 2005
through 2030. This demand will
be mainly in Asia, which takes
over the top spot from North
America. Non-OECD countries
are expected to account for more
than 70 percent of total
consumption growth and
production of natural gas over
the forecast period.
One fact is now evident: the
US will likely not import LNG
over the next decade. According
to data from the EIA, this is
equivalent to losing about 23%
of projected global LNG market.
We’ll discuss why this insight
should be of interest to Nigeria
in the next slide.
Let’s review some interesting
d a t a f r o m t h e E n e r g y
Information Administration
(EIA).
According to EIA, Nigeria
exported 17.97 million metric tons
of LNG in 2010, making Nigeria
the 5th largest LNG exporter in
the world and the largest LNG
exporter in the Atlantic Basin.
Europe, with 67 percent, is
Nigeria’s biggest export market.
The U.S. imported 0.86 million
metric tons of Nigerian LNG (5%),
or only 1 percent of total U.S. LNG
imports.
So, while we see that the U.S. is
not a significant export market for
Nigerian LNG, the real danger to
Nigeria lies in potential U.S.
export of her shale gas to global
LNG market.
Indeed in 2011, the impact of
the U.S. shale gas boom was not
felt by Nigeria because more of
the country’s LNG exports went to
Japan, where Nigerian exports
tripled due to increased LNG
demand following the Fukushima
nuclear accident.
However, we know that quite a
few countries (notably Australia
and China) are interested in
applying the technology which
has allowed North America to
unlock unconventional gas.
Will these countries achieve the
same success as the U.S.?
While current forecast is that
similar commercial production
remains some years away, the
point to note is that interest in
unconventional production is
growing, even in Europe,
Nigeria’s biggest LNG market.
It is worth pointing out that
Nigeria’s share of global LNG
market dropped in 2011, from 10
percent to 7 percent, mainly due
to lack of recent capacity increase
and rising production from Qatar
and Aus t ra l ia . Niger ia ’ s
estimated LNG production
capacity is currently 22 million
metric tons per year, and no
major increase is expected to
come online before 2015.
With Nigeria’s proven natural
gas reserves put at an estimated
180 trillion cubic feet as of end
2011 - the ninth largest in the
world – the country needs to
open up her market and focus on
being a competitive, low-cost,
high-reliability supplier to the
global market.
Global changer
It would be worthwhile
examining a number of factors
that have contributed to what
could possibly be a global game
changer in our industry:
First, there was availability of a
huge prime resource base.
Second, there was expanded
access to this resource, with
c lear resource r ights to
investors. This allowed for
investment in, and application
of appropriate technology.
Third, you had a system that
tried to avoid arbitrary and
punitive tax policies
Fourth, clear regulatory
system that not only supported
s a f e d e v e l o p m e n t a n d
production, but responded to
industry push to expedite the
permitting and construction of
p i p e l i n e s a n d o t h e r
infrastructure necessary to get
these new energy supplies to
market.
These conditions, mostly
absent in other places, came
together at the right time and
created what we are witnessing
today.
Going forward
Nigeria must recognise that a
significant resource shift has
turned a key trade region into
possibly a direct competitor, and
avoid creating barriers with
potential to make her industry
uncompetitive for investments.
Coupled with the emergence of
other resource basins in East,
Central and South African
countries, Nigeria must work to
maintain her place as a key
contributor to global energy
supply.
The Government’s focus on
restructuring the industry
through the Petroleum Industry
Bill (PIB) is therefore timely, but
it must be designed and
implemented correctly.
This means:
? Globally competitive
fiscal terms, to attract capital
? Stable and fair business
inves tment c l imate wi th
appropriate protections
? E n s u r i n g t h a t
fundamental issues such as
f u n d i n g l i m i t a t i o n s a n d
operations inefficiencies are
addressed.
? D e v e l o p i n g a
completely thought-through
transition, to avoid major
disruptions.
In conclusion, I would like to
leave you with a summary of
our thoughts:
Population and economic
growth in non OECD countries,
projected to grow significantly
through 2040, will drive energy
demand/use.
Oil and natural gas will remain
the largest single source of
energy in the foreseeable future.
The recent boom in North
America’s domestic production
of unconventional oil and gas
has changed global supply and
demand market; other countries
are seeking to apply the
technology
Nigeria needs to develop clear
regulatory and competitive
policies and make plans around
a potential scenario where the
U.S. and new players from Africa
compete for the same export
market.
Competition is global and
requires more than resource to
attract and maintain investment.
We hope that by sharing this
Outlook, we can all help
contribute to making informed
decisions about the nation’s
energy future.
Distinguished participants,
ladies and gentlemen, once
again, I thank you all for your
kind attention.
CONTINUED FROM PAGE 12
14Power
FG to begin inspection of power projects… Only 40 of 491 projects completed
Ughelli power station
Th e F e d e r a l
Government is to b e g i n a n inspection of all power projects
site across the country from this March, warning that it might sanction contractors found to be delaying in the delivery of their projects.
This follows the poor execution and delivery rates o f p o w e r p r o j e c t s b y contractors, as only about 40 out of 491 contracts so far a w a r d e d h a d b e e n completed.
To this end, Vice President Namadi Sambo, said he will send out a crack team of project monitoring group by from this month, to ascertain the level of work at the sites and to take far-reaching decisions if necessary,
Mr. James Olotu, the Managing Director, Niger D e l t a Po w e r H o l d i n g Company Limited, NDPHC, promoters of the National Independent Power projects, NIPP, disclosed this during the commissioning of three new 15 MVA sub-stations and switchgears panel in Yaba, Orile-Coker and Kirikiri sub-stations in Lagos.
He said there are currently about 491 power projects across the country, while
about 40 of the projects had been completed.
He however added that some of the others yet to be completed have reached a d v a n c e d s t a g e s o f completion and would be completed before the end of the year.
He disclosed that the Federal Government set a target of June this year for the completion of all distribution p r o j e c t s , w h i l e a l l transmission projects and about 99 per cent of all generation projects are expected to be completed by
the end of the year.Accordingly, he said the
project monitoring team will visit all the projects sites, so that actions can be taken on the spot if we find that the contractors are not meeting up with target given to them.
He, however, noted that the g o v e r n m e n t i s n o t compromising quality for speed, saying that while emphasis is placed on speedy completion, it is also ensuring that the projects are done to international standards.
e said, “While doing Hthis, we are aware that it is also important that the delivery should be known to be actually effective and qualitative, not delivery that is fast and then as we move back and go away after commissioning, they say
something has broken down. That is fraud. We want the contractors to deliver quality work.
“But the time for delay is over. No more delay again on this project. Every contractor has no excuse on why they
should not deliver on their project.”
On the issue of supply of gas to the power stations, Olotu said all stakeholders in the power sector are working together to ensure that the challenges facing steady power supply, especially availability of gas, is dealt with.
Also speaking, Mr. Oladele Amoda, Chief Operating Officer, Eko Electricity Distribution Company, said with the addition of the new 15 MVA 33KVA/11 KVA sub-stations at New Yaba, Orile-Coker and Kirkiri sub-stations, the total capacity at Yaba has improved to 45 MVA, Ori le-Coker has improved to 30 MVA 11 KVA while Kirikiri has risen to 30 MVA 33KVA.
He said the installation of t h e s u b - s t a t i o n s a n d sw i t chgear s w i l l he lp minimize load shedding and tackle the issue of epileptic power supply.
H e s a i d t h e n e w equipments were strategic, especially as they cater for the need of strategic areas of the state, areas, adding that the benefiting communities have started feeling the impact of the projects in terms of improved power supply.
the government is not compromising quality for speed,
saying that while emphasis is placed on speedy completion, it is also ensuring that the projects
are done to international standards
Delta tackles Asaba power crisis with 262 transformers
Emma AMAIZE
ELTA State Government has D
acquired 262 electricity distribution transformers of various capacities to surmount the epileptic electricity supply in Asaba, the state capital and environs. Governor Emmanuel Uduaghan, who disclosed this in Asaba said with the acquisition of the transformers, work would commence shortly on the 150 MVA Step Down Sub-Station in Asaba. He explained that when completed, the project would lead to a remarkable improvement in electricity to Asaba and environs, as Asaba would no longer depend on the Obosi Sub-Station. Governor Uduaghan said the transformers would be deployed in areas of need to strengthen the distribution network. He disclosed that the state hosts four functional Power plants situated at Ughelli, Okpai and Sapele and promised to patronise the Akwa-lbom based Transformer Producing Company in the procurement of the next batch of transformers.
In his words” We got to know of the indigenous transformer production company in Akwa Ibom after we have placed orders for these transformers from SIEMENS. We will patronize them in our next procurement.”
15Power
Powercell to invest $2m in power backups
The Managing D i r e c t o r , P o w e r c e l l L i m i t e d , M r. Tayo Balogun, in
this interview with Sebastine Obasi, speaks about the use of Uninterrupted Power Supply, UPS and Inverter s y s t e m s t o p r o m o t e sustainable energy supply.
Te l l u s m o re a b o u t Powercell and its business?
Powercell was incorporated to take care of renewable energy. We are the sole p a r t n e r s t o A B B o f Switzerland. We are their only representative both in Nigeria and West Africa. Renewable energy is energy that comes from natural sources like the sun, wind, wastes. The one we are actually into deals with the sun and the wind. You know every day the sun must come out and the wind must blow. These things are used as sources of energy worldwide. That is why we embraced it.
Why did you decide to go for this type of business?
We looked at the energy sources in Nigeria about three years ago vis-à-vis the prevailing power challenges and thought of how we could help in alleviating the power problem. We started by bringing in inverter from the United States of America, and then battery, as a back-up. Then, we went further to explore the renewable energy aspect. The world is focusing more on the wind and the sun as sources of energy. We felt therefore that Nigeria should not be left behind. We have been in the back-up business, that is inverter and UPS, for three years now, but we have been in the renewable energy business for five years.
Can you explain the p a r t n e r s h i p w i t h ABB/Newave?
Newave Energy is one of the leading manufacturers of UPS in Europe. It is based in Switzerland. In June 2012, the company was bought over by ABB. All over the world, mergers and acquisitions are common these days. The marriage between ABB and Newave came into being on June 2, 2012. We signed our p a r t n e r s h i p a s s o l e representative of the ABB UPS on September 24, 2012. Newave is a member of the ABB Group. We opted to market ABB brand of UPS in N i g e r i a b e c a u s e t h e company is well known in Nigeria. It has been around for a long time.
Do you have the capacity for the business?
One of the things ABB is known for is training and retraining. We were involved in their various trainings after which we were certified by the company. We have also sent our engineers and some other staff to Switzerland for their training. The reason for all these is that we are looking at a wide customer base, such that our staff would be able to serve them satisfactorily.
How much are you then investing in the business?
We are investing about $2million in the next 13 months. That is not going to be all we will invest. We are going to surpass it, going by the feelers we are getting f r o m o u r p r o s p e c t i v e customers. We brought in some UPS last year and did some demonstrations for our customers. Since then, we have been getting a lot of enquiries. By the first week in March, the first batch of our consignment would have hit
the market. We have been doing aggressive marketing and we are expectant that the result will be beneficial. Many companies have been making enquiries about our products. They include; oil companies, banks, steel companies, pharmaceutical companies, even individuals who are tired
of using brands that are not durable. Because ABB is a well known brand, we give two years warranty to our customers. We are the only company marketing UPS that gives that duration of warranty. That shows we know what we are selling. We can beat our chest and say
that what we are selling is the best.
How affordable are your products?
O u r p r o d u c t s a r e affordable. If you compare them with the others in their class, you find out that they are the cheapest. When you are entering the m a r k e t n e w l y, y o u consider the price of your products. We want to get to as many customers as possible, that is why we m a d e o u r p r i c e s affordable. From reports worldwide, the rate of failure of Newave products is less than one percent.
What are your plans for the future?
I want to see Powercell, in partnership with ABB, as a leader in the back-up system in Nigeria. I want to see Powercell as a company people can rely on. We have a reputation that we cannot allow to be dragged on the mud. So in the next five years, I want to see Powercell/ABB products as household names in Nigeria.
Traxxas Power Cell batterys
WARRI INDUSTRIAL PARK AD
WARRI INDUSTRIAL PARK AD
18Power
jaw Oil and Gas P r o d u c i n g IC o m m u n i t i e s
Executive Forum and Idjerhe Enhancement Group have gone to court for interpretation of the Law on Tenure of the Chairman of Delta State Oil Producing Areas Development Commission (DESOPADEC).
In a summons brought pursuant to Order 3 Rule 15 of the High Court of D e l t a S t a t e ( c i v i l procedure) Rules 2009, the g r o u p i s s e e k i n g a dec lara t ion that the a p p o i n t m e n t o f t h e chairman of Delta State Oil P r o d u c i n g A r e a s D e v e l o p m e n t Commission, Mr Oritsua Kpogho, be declared null and void in violation of the provisions of section7(1) ( b ) ( c ) o f t h e l a w s establishing Delta State Oil Producing Areas Development Commission (DESOPADEC).
In exercise of its m a n d a t e , t h e Nigerian Electricity R e g u l a t o r y C o m m i s s i o n ,
NERC, recently developed a customer complaints forum to redress the mechanism for handling such complaints. The Commiss ion a l so inducted a 25 man members for the forum’s unit in Abuja, to oversee such complaints and effectively tackle them.
Members of the Forum were drawn from different w a l k s o f l i f e a n d organizations, including the Manufacturer Association of Nigeria (MAN); Consumer Protection Council (CPC); N o n - G o v e r n m e n t a l Organisations (NGOs); N i g e r i a n S o c i e t y o f Engineers (NSE); and the Nigerian Association of Chambers of Commerce,
Delta tackles Asaba power crisis with 262 transformers
Emma ARUBI
E LTA S t a t e G o v e r n m e n t has acquired D
262 electricity distribution transformers of various capacities to surmount the epileptic electricity supply in Asaba, the state capital and environs. Governor Emmanuel Uduaghan, who disclosed this in Asaba said with the a c q u i s i t i o n o f t h e transformers, work would commence shortly on the 150 MVA Step Down Sub-Station in Asaba.
He explained that when completed, the project w o u l d l e a d t o a remarkable improvement in electricity to Asaba and environs, as Asaba would no longer depend on the O b o s i S u b - S t a t i o n . Governor Uduaghan said the transformers would be deployed in areas of need t o s t r e n g t h e n t h e distribution network.
Power tussle: Group seeks clarification over tenure
Kunle KALEJAYE
NERC inducts members into complaints forum
I n d u s t r y , M i n e s & Agriculture (NACCIMA).
Those representing MAN are: Mr. Segun Ajayi, Engr. Nzewi Chukuemeka, Ali Madugu, Mr. Vincent Okuku and Dr. Babajide Taiwo., while Engr. Shamm Titus Kolo, Barr. Nwakwo Njideka, Abubakar Ahmed, Erema Ransome Daka, and Barr. Oseni Yinka represented the CPC in the forum.
Other members included Engr. Solomon Nyagba, Mr. Chukuemeka Okereke , Sulieman Bello, Engr. Emeka Unachukwu and Engr. Ismaila Olatunde Alapa, all from NACCIMA, while Ahaji Hashim Dikko, Mr. Juddy Okere, Naseer kwa ja’ afaru, Mr. Chisom Dike, Mrs. Eniola Oyedele represented the NGOs.
Members of the NSE in the forum are Engr. Jacob Fadupin, Engr. Steven Uzoechina, Engr. Ibrahim
Idris Daho, Engr. Christopher Ahiakwo, and Engr. Oluyemi Akindiji.
The Forum, which is akin to an appellate court, is to handle complaints emanating f r om the DISCO. Any dissatisfied customer who still feels that they have not gotten the desired attention, or are dissatisfied with the outcome as addressed by the DISCO, can then appeal to the Forum, being the next level of redress in the system.
In addition, Standard and Procedures provides for the establishment of Customer Complaints Units (CCUs). The CCU is the dispute resolution platform set up by the Distribution Licensee (DISCO). The DISCO ‘s CCU represents the first stage of a d d r e s s i n g c u s t o m e r complaints.
NERC therefore mandated that every DISCO to establish a CCU within its premises,
which shall be responsible for receiving and resolving customer complaints.
A c c o r d i n g t o N E R C Chairman, Dr. Sam Amadi, all further appeals from the Forum are to be made to the Commission for further actions. But where the c o n s u m e r s t i l l f e e l s d i s s a t i s f i e d w i t h t h e Judgment, he reiterated that he or she is free to move the case to the conventional courts.
Other steps taken by NERC to ensure that customers complaint are addressed include the establishment of C o n n e c t i o n s a n d Disconnections Procedures for Electricity Services that seeks to provides customers with electricity at their homes or business places. It a l s o e x p l a i n e d t h e procedures for obtaining such a supply and the documentation required.
Kunle KALEJAYE
Electric bulbs
19Finance
Ni g e r i a i s es t imated to have lost more than $40 billion
or N6.3 trillion investments in the last two years as a result of uncertainties in the o i l a n d g a s s e c t o r . Specifically, oil companies have held back over $40 billion worth of investment while waiting to see what h a p p e n s , s e q u e l t o regulatory uncertainty. Sweeping reforms to taxes and royalties, transparency, local participation and the Nigerian National Petroleum Corporation, NNPC, have been promised since 2007.
According to estimates from the Senate Committee on the upstream oi l industry, investments of at least $28 billion in the oil and gas sector have been lost or d e f e r r e d s i n c e 2 0 1 0 . Similarly, uncertainties are holding back Shell Petroleum Development Company ’s (SPDC) planned investment of about $30 billion in two offshore deep water projects in Nigeria. At the just concluded Nigeria Oil and Gas (NOG-13) conference he ld in Abuja , Mut iu S u n m o n u , M a n a g i n g Director of SPDC, said it was regrettable that Nigeria was losing huge revenues and investments, due to oil theft and bunkering because of unce r ta in t i e s . Though Sunmonu did not mention the projects where the fund would be deployed to, he stated that “SPDC would rather wait for stable and right conditions before committing finances.”
According to him, “Perhaps Nigeria’s oil and gas industry is slipping into the era when it took Mexico about 50 years t o r e c o v e r f r o m s u c h challenges in its oil industry. I recall the Mexican story where it took the country 50 years to recover from the loss in its oil production and my worry is that we are slipping towards that.”
DivestmentsWhile Shell may have held
back further investments in the sector, Conocophillips, a Houston Texas-based oil group, sold its assets after 46 years of operation in Nigeria to Oando Group. Some of these assets included its 17 percent stake in Brass Liquefied Natural Gas, LNG
Nigeria loses over $40bn investments in 2 years
Sebastine OBASI
facility and its joint venture stakes in OMLs 60, 61, 62, 63, 131, as well as Kwale-Okpai independent power plant.
T h e c o m p a n y w a s estimated to have realized more than $1.7 billion from the sale of its assets in Nigeria. The sale of its
Nigerian business unit was part of ConocoPhillips’ plan to i n c r e a s e v a l u e f o r s h a r e h o l d e r s t h r o u g h po r t f o l i o op t imiza t i on , focused capital investments that del iver growth in production and cash margins, improved returns on capital, a n d s e c t o r - l e a d i n g shareholder distributions.
Earlier, British Gas (BG) Exploration and Production, citing Nigeria’s turbulent oil and gas sector, pulled out of Nigeria, despite investing more than $500 million in its exploration activities on the offshore blocks OPLs 332, 286 , 284 and Oloko la Liquefied Natural Gas (OK LNG).
While announcing the divestment from OK LNG, Frank Chapman, Chief Executive Officer, said, “We are switching properties to development of projects elsewhere, most probably the
expansion of our new assets i n Au s t r a l i a . A t t h e appropriate time, there w o u l d b e f u r t h e r opportunities in Nigeria. For today, it is a low priority.”
I n t e r n a t i o n a l O i l Companies, IOCs are finding it easier to bye-pass Nigeria i n t h e i r i n v e s t m e n t decisions, due to what they termed unfriendly oil sector operating environment. Consequently, Nigeria is estimated to have lost about $2.7 billion or N426 billion from decline in crude oil production in the last quarter o f 2012 - October to December.
According to the Central Bank of Nigeria, CBN, Fourth Quarter Economic Report, Nigeria’s oil revenue in the fourth quarter of 2012 dipped by N112.6 billion, as gross oil receipts in the Federation Account stood at N1.824 trillion. That showed
a 5.8 percent reduction from N1.936 trillion recorded in the third quarter of 2012.
The CBN report also stated that Nigeria’s crude oil p r o d u c t i o n , i n c l u d i n g condensates and natural gas liquids stood at 2.00 million barrels per day (mbpd) or 184.00 million barrels during the fourth quarter of 2012, compared to the 2.26 mbpd or 207.92 mi l l ion bar re ls recorded in the third quarter, thus representing a decrease of 0.26 mbpd or 11.5 per cent in production level.
The report said the average price of Nigeria’s reference crude, the Bonny Light stood at $112.73 (N17,811.34) per barrel, with crude oil export at 1.55 mbpd or 142.60 million barrels in the fourth quarter, compared with 1.81 mbpd or 166.52 million barrels in the preceding quarter, representing a decline of 14.4 per cent.
Bar of gold and Euro notes
20Technology
Historyn the 10th century, t h e A r a b i a n p h y s i c i a n M a s a w a i h a l -Mardini (Mesue
the Younger) wrote of his experiments in extracting oil f r o m “ s o m e k i n d o f bituminous shale”.The first shale oil extraction patent was granted by the British Crown in 1684 to three people who had “found a way to extract and make great quantities of pitch, tarr, and oyle out of a sort of stone”. Modern industrial extraction of shale oil originated in F r a n c e w i t h t h e implementation of a process invented by Alexander Selligue in 1838, improved upon a decade later in Scotland using a process invented by James Young. During the late 19th century, plants were built in Australia, Brazil, Canada, and the United States. The 1894 i n v e n t i o n o f t h e Pumpherston retort, which was much less reliant on coal heat than its predecessors, marked the separation of the oil shale industry from the coal industry.
C h i n a ( M a n c h u r i a ) , Estonia, New Zealand, South Africa, Spain, Sweden, and Switzerland began extracting shale oil in the early 20th century. However, crude oil discoveries in Texas during the 1920s and in the Middle East in the mid 20th century brought most oil shale industries to a halt. In 1944, the US recommenced shale oil extraction as part of its Synthetic Liquid Fuels Program. These industries continued until oil prices fell sharply in the 1980s. The last oil shale retort in the US, o p e r a t e d b y U n o c a l Corporation, closed in 1991. The US program was restarted in 2003, followed by a commerc ia l l eas ing program in 2005 permitting the extraction of oil shale and oil sands on federal lands in accordance with the Energy Policy Act of 2005.
As of 2010, shale oil extraction is in operation in Estonia, Brazil, and China. In 2008, their industries
I
Understanding Oil Shale extraction
Phone: 08027181717, e-mail: [email protected]
Jim-Rex Lawson MOSES
Picture showing A.C. Kirk’s retort, used in the mid-to-late 19th century; it was one of the first vertical oil shale retorts. Its design is typical of retorts used in the end of 19th and beginning of 20th century.
produced about 930,000 metric tonnes (17,700 barrels per day) of shale oil. Australia, the US, and Canada have tested shale oil extraction techniques via demonstration projects and are planning commercial implementation; Morocco and Jordan have announced their intent to do the same. Only four processes are in commercial use: Kiviter, Ga lo te r, Fushun , and Petrosix .
What is Oil ShaleT h e t e r m o i l s h a l e
generally refers to any sedimentary rock that contains solid bituminous materials (called kerogen)
Processing principles
Overview of shale oil extraction
t h a t a r e r e l e a s e d a s petroleum-like liquids when the rock is heated in the chemical process of pyrolysis. Oil shale was formed millions of years ago by deposition of silt and organic debris on lake beds and sea bottoms. Over long periods of time, heat and pressure transformed the materials into oil shale in a process similar to the process that forms oil; however, the heat and pressure were not as great. Oil shale generally contains enough oil that it will burn without any additional processing, and it is known as “the rock that burns”.
Oil shaleOil shale can be mined and
processed to generate oil similar to oil pumped from conventional oil wells; however, extracting oil from oil shale is more complex than convent iona l o i l recovery and currently is more expensive. The oil substances in oil shale are solid and cannot be pumped directly out of the ground. The oil shale must first be mined and then heated to a
Oil shale
high temperature - a process c a l l e d r e t o r t i n g ; t h e resultant liquid must then be separated and collected. An alternative but currently ex p e r i m e n t a l p r o c e s s referred to as in situ retorting involves heating the oil shale while it is still underground, and then pumping the resulting liquid to the surface.
The Oil Shale IndustryWhile oil shale has been
used as fuel and as a source of oil in small quantities for many years, few countries currently produce oil from oil shale on a significant commercial level. Many
countries do not have s i g n i f i c a n t o i l s h a l e resources, but in those countries that do have s i g n i f i c a n t o i l s h a l e resources, the oil shale industry has not developed because historically, the cost of oil derived from oil shale has been significantly higher than conventional pumped oil. The lack of commercial viability of oil shale-derived oil has in turn inhibited the development o f bet ter technologies that might reduce its cost.
Relatively high prices for conventional oil in the 1970s and 1980s stimulated interest and some development of better oil shale technology, but oil prices eventually fell, and major research and development act iv i t ies l a r g e l y c e a s e d . M o r e recently, prices for crude oil have again risen to levels that may make oil shale-based oil production commercially v i a b l e , a n d b o t h governments and industry are interested in pursuing the development of oil shale as a n a l t e r n a t i v e t o conventional oil.
Oil Shale Mining and Processing
Oil shale can be mined using one of two methods: underground mining using the room-and-pillar method or surface mining. After mining, the oil shale is transported to a facility for retorting, a heating process that separates the oi l fractions of oil shale from the
CONTINUES ON PAGE 21
21TechnologyPhone: 08027181717, e-mail: [email protected]
CONTINUED FROM PAGE 20
Understanding Oil Shale extractionmineral fraction. The vessel in which retorting takes place is known as a retort. After retorting, the oil must be u p g r a d e d b y f u r t h e r processing before it can be sent to a refinery, and the spent shale must be disposed of. Spent shale may be disposed of in surface impoundments, or as fill in graded areas; it may also be disposed of in previously mined areas. Eventually, the mined land is reclaimed. Both mining and processing of oil shale involve a variety of environmental impacts, such as global warming and greenhouse gas emissions, disturbance of mined land, disposal of spent shale, use of water resources, and impacts on air and water quality. The development of a commercial oil shale industry would also have significant social and economic impacts on local c o m m u n i t i e s . O t h e r impediments to development of the oil shale industry include the relatively high cost of producing oil from oil shale, and the lack of regulations to lease oil shale.
Surface RetortingWhile current technologies
are adequate for oil shale mining, the technology for surface retorting has not been successfully applied at a commercially viable level even in the United States, although technical viability has been demonstrated. Further development and testing of surface retorting technology is needed before the method is likely to succeed on a commercial scale.
In Situ RetortingShell Oil is currently
developing an in s i tu conversion process (ICP). The process involves heating underground oil shale, using electric heaters placed in deep vertical holes drilled through a section of oil shale. The volume of oil shale is heated over a period of two to three years, until it reaches 650–700 °F, at which point oil is released from the shale. The released product is gathered in collection wells positioned within the heated zone.
S h e l l ’ s c u r r e n t p l a n involves use of ground-freezing technology to establish an underground
Stuart Oil Shale Facility, Queensland, Australia
Surface Retortbarrier called a “freeze wall” around the perimeter of the extraction zone. The freeze wall is created by pumping refrigerated fluid through a series of wells drilled around the extraction zone. The f r e e z e w a l l p r e v e n t s groundwater from entering the extraction zone, and keeps hydrocarbons and other products generated by the in-situ retorting from leaving the project perimeter.
Shell’s process is currently unproven at a commercial scale, but is regarded by the U.S. Department of Energy a s a v e r y p r o m i s i n g technology. Confirmation of the technical feasibility of the concept, however, hinges on the resolution of two major technical issues: controlling g r o u n d w a t e r d u r i n g production and preventing subsurface environmental p r o b l e m s , i n c l u d i n g groundwater impacts.
DisadvantagesB o t h m i n i n g a n d
processing of oil shale i n v o l v e a v a r i e t y o f environmental impacts, such as global warming and greenhouse gas emissions, disturbance of mined land; impacts on wildlife and air and water quality. The d e v e l o p m e n t o f a c o m m e r c i a l o i l s h a l e industry as earlier stated would also have significant social and economic impacts on local communities. Of special concern in relatively arid regions is the large amount of water required for o i l s h a l e p r o c e s s i n g ; currently, oil shale extraction and processing require several barrels of water for each barrel of oil produced, though some of the water can be recycled.
Te c h n o l o g y m i n i s t e r
commends Shell, others at Science Fair
T h e M i n i s t e r o f Communication Technology, Ms. Omobola Johnson, recently commended Intel Corporat ion, and Shell Petroleum Development Company, SPDC, for their support towards redirecting the objectives of educational development from knowledge based to empowerment.
The minister gave the commendation at the 2013 Annual National Science and Engineering Fair, which held at the University of Lagos. She also noted that the decision of the firms to bankroll the fair would further boost the study of Science and Technology in the country.
Activities to mark the four-day event included Science Q u i z a n d e x h i b i t i o n showcase. The exhibition stage saw the competing schools pass their innovative inventions through several stages under the keen watch of panel of judges. The fair was jointly sponsored by Intel Corporation, Shell and Interswitch.
While applauding the participating students, the minister, represented at the occasion by the Director General of Nigerian Postal Services, NIPOST, Mr. Lawrence Okoro, stated that i t was expedient that students at that level developed interests in practical sciences and
engineering solutions to c h a l l e n g e changes in t h e i r environment a n d t h e nation as a whole.
H e a d , S o c i a l Performance, SPDC, Mr. E m m a n u e l A n y i m , disclosed that t h e partnership with Intel and Interswi tch was part of the Shel l ’s commitment to national development, a i m e d a t a c t i v e l y pos i t ioning the Nigerian educational
sector on a global pedestal.Ayim said: “Science is key
to the development of any country and we feel that the best way to begin is to encourage young talents by exposing them to global standards. And we are happy that the young scientists are rising to the challenge already.”
Also commenting, the s p o k e s m a n f o r I n t e l Corporation, Mr. Osagie O g u n b o r , s a i d t h e partnership with Shell is pursuing a transformation agenda in the educational sector, to encourage a more p rac t i ca l approach to learning, and make students b e c o m e p r a g m a t i c researchers rather than p a s s i v e r e c e i v e r s o f knowledge.
“The changing trends in the global economy are increasingly becoming knowledge-based being driven by advancements in I n f o r m a t i o n a n d Communication Technology and this has significantly raised the stakes in the educational sector, thus we want to encourage a practical approach that will excite these young minds and spur their appreciation and effective contribution at the student-teacher level and, ultimately add to their wealth of knowledge in their respective disciplines.” Ogunbor noted.
22Solid Mineral
Small-scale and a r t i s a n a l m i n i n g , a s e c t o r t h a t governments
and development agencies often see as only a problem, could be a source of sustainable livelihoods for millions of marginalised people, say researchers at the International Institute f o r E n v i r o n m e n t a n d Development, IIED.
The sector is a paradox - productive but undervalued, conspicuous yet overlooked, and ‘ sma l l - s ca le ’ bu t economically and socially significant. It produces about 85 per cent of the world’s gemstones and 20-25 per cent of all gold. Its mines provide jobs and income for 20-30 million of the world’s poorest people and support the livelihoods of five times that number.
A s e c t o r m e t w i t h inadequate attention not just in Nigeria, but in most parts of the world also, but this trend is likely to change in the short term future. Most recently, experts and other international institutes, spear-headed by the IIED, have launched a report that ident i f ies the ser ious knowledge gaps in the sector and sets out options for a major new project-in-the-making. This project will aim to help policymakers ensure small-scale mining meets its potential to improve lives and take better care of local environments.
It will do this by connecting stakeholders, including m i n e r s a n d t h e i r communities, and ensuring t h a t , b e t t e r q u a l i t y information is generated and used effectively in policy making at local, corporate, national and international levels.
“Small-scale and artisanal mines can be a force for good, just as small-scale forestry and agriculture are, but right now, they operate in a hidden world,” says Sarah Best of IIED. “We want to identify ways to overcome t h e c h a l l e n g e s i n information, investment and institutions that prevent small-scale mining from realising its potential to contribute to sustainable development.”
Overall, artisanal and small-scale mining (ASM),
Beaming the light on small-scale mining
Noel ONOJA
employs ten times more people than large-scale mining. But it takes place in very remote areas, usually involves poor and vulnerable people, including women a n d c h i l d r e n a n d i s r e n o w n e d f o r s e v e r e pollution and harsh working conditions.
Despite all of these, development agencies and national authorities have historically given little attention to the sector and how to make it sustainable, instead focusing on large scale mining. Rather than supporting small-scale min ing , gover nments ’
policies are often poorly designed or implemented, or even repressive.
The miners themselves lack access to the rights, financial services, market information and technology they need to make this is a prosperous economic act ivi ty with reduced environmental impacts. As a result, many are often driven to operate illegally and it is this illegality that has biased attitudes about the whole ASM sector.
Donors often ignore small-scale and artisanal mining, perceiving activities such as small scale agriculture and forestry to be more ‘positive’
livelihoods for the poor. L a r g e - s c a l e m i n i n g companies often only engage with the small-scale sector in cases of conflict over land and resources.
The report shows that, while there is good hands-on experience and innovation o n - t h e - g r o u n d — f o r i n s t a n c e , w i t h s o m e governments adopting more inclusive policies and with the beginnings of ethical sourcing — these are often not widely known about, or face huge implementation challenges which stall progress.
“ G o v e r n m e n t s ,
development agencies and the private sector have tended to overlook small-scale mining, seeing it as a source of problems or something that should not exist,” says Abbi Buxton of IIED. “This neglect has to end, particularly as the d e m a n d f o r m i n e r a l resources continues to grow.”
IIED’s new programme of work follows earlier work on mining. In 2000-2002, the institute ran the ‘Mining Minerals and Sustainable Development’ (MMSD) project, a major review that gathered evidence and engaged s takeho lde r s around the question of ‘how can mining and minerals best contribute to the global transition to sustainable development?’
I t w i l l o v e r c o m e weaknesses in the way that knowledge is gathered and influences policy, such as the lack of information from artisanal or small-scale mining communities, and l i m i t e d c o o r d i n a t i o n between sector stakeholders. It will promote dialogue, learning and leadership at national and international levels and find practical solutions to sector-wide challenges, such as child labour, health hazards, informality, human rights, pollution, and transparency in supply chains. And it will e m b r a c e d i v e r s e collaborations at national and international level.
The new report presents several programme options that IIED has identified f o l l o w i n g i n i t i a l consultations with ASM sector stakeholders. The institute now welcomes responses to these options and expressions of interest in collaboration.
Local mining
23Labour
TRADE Union C o n g r e s s , T U C , h a s picked holes in t h e
d i s c r e t i o n a r y p o w e r s allocated to the President a n d t h e M i n i s t e r o f Petroleum in Petroleum Industry Bill, PIB, before the National Assembly, saying it is an open invitation for abuse.
President of TUC, Comrade Peter Esele, is particularly c o n c e r n e d a b o u t discretionary powers to a minister and the President in such a sensitive industry which is the main stay of the nation’s economy and where the standard all over the world is international best practice.
It would recalled that Comrade Esele, who was part of the Presidential Committee put in place by the Federal Government to prepare the draft PIB, in an interview with Sweetcrude, disowned the draft Bill before the National Assembly.
Esele argued that the d i s c r e t i o n a r y p o w e r s accorded to the president and petroleum minister must be removed from the bill to ensure transparency in dealing with operators especially in award of contracts to private investors in the industry.
The former President of the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, argued that all licenses, leases, contracts and awards must be through transparent competitive bidding, while a l l t e n d e n c i e s f o r discretionary or absolute powers in the bill must be jettisoned.
According to him, the National Executive Council, NEC, of TUC had critically examined the contents of the bill before the National Assembly and established that there were challenges in the bill and resolved that it should be properly debated with a view to ensuring adequate changes.
H e s a i d : “ M y o w n u n d e r s t a n d i n g o f “discretionary powers” is a s i t u a t i o n w h e r e t h e petroleum minister will issue a directive that an investor should not be given an oil block even when the said investor has met all the
PIB: TUC queries discretionary powers to president, minister
Victor AHIUMA-YOUNG
requirements. This should not be so, we do not need such powers in the bill. If an investor is qualified for oil block then so be it and if the investor is not qualified, let the law be implemented without fear or favour. This is our concern and we want the National Assembly to address this concern in the interest of t h e i n d u s t r y a n d t h e economy.”
T h e T U C P r e s i d e n t contended Nigeria should depart from the old regime of corruption and have a PIB with a balance between government and investors’ interest to ensure growth of the nation’s Petroleum industry. Esele called on the National Assembly to ensure that the PIB reflected a position that would promote and sustain growth and
fairness of all stakeholders in the Nigeria project, urging the lawmakers, however, to expedite action in the passage of the bill, because the delay was eroding investors’ confidence in the sector.
In a another development, TUC’s NEC of TUC has faulted the National Assembly’s suspension, sine die, of the debate on local government autonomy, saying “ with so much resources committed to gaining people’s opinion across the country, it is criminal and inexcusable for the lawmakers to suspend the debate at this stage.” In a communiqué at its meeting in Benin City, Edo State, they a r g u e d t h a t l o c a l government autonomy was not negotiable if democracy was to take a firm root in the country.
It noted that states or interests opposed to the local government authority were doing the nation’s fledging democracy more harm than good.
TUC also condemned the Federa l Gover nment ’ s budget of N4billion for the proposed First Lady ’s Mission Home.
A c c o r d i n g t o t h e communiqué, TUC “lends i ts voice to Professor Soyinka’s view that the project is a mind-boggling fiscal misappropriation. The NEC believes that this is another drain pipe on the nation’s economy and called on the federal government to stop forthwith the project. It advised that such money should be applied to create j o b s f o r t h e t e e m i n g Nigerian youths.”
I t c o m m e n d e d t h e approval of payments of t e r m i n a l b e n e f i t s o f electricity employees, but requested that government builds confidence in the process by ensuring the participation of the unions in the sector in the compilation and the computation of the benefits of all employees.
President Goodluck Jonathan
24Labour
SENIOR Staff Association of Electricity and A l l i e d C o m p a n i e s ,
SSAEAC, is not finding Federa l Gover nment ’ s announcement that N384 billion will be used to settle the terminal benefits of workers o f the Power H o l d i n g C o m p a n y o f Nigeria, PHCN, ahead of the privatization of PHCN’s assets, funny.
The association has not only rejected it like its National Union of Electricity E m p l o y e e s , N U E E counterpart, but went further to petition the Minister of Power, reminding the Government that labour, only gave condi t ional support to the planned privatization of the sector.
SSAEAC in the petition through i ts President-G e n e r a l a n d G e n e r a l Secretary, Engineer Bede O p a r a a n d B i o d u n Ogunsegha, a lawyer, warned government that if it went ahead with the process of privatization without carrying labour along, it would be definitely counter- productive.
The petition read “In furtherance of the agreement that the Unions in the Power S e c t o r s i g n e d w i t h G o v e r n m e n t o n 1 1 t h December, 2013, the Federal Government of Nigeria through the Bureau for Public Enterprises (BPE), engaged the services of an International Consultant: A l ex a n d e r Fo r b e s , t o c o m p u t e , u s i n g t h e necessary variables to arrive at the total terminal benefits due to staff of PHCN and also determine the individual benefits. The Unions were invited to work with the Consultancy and BPE, to diligently carryout this assignment.”
“At the meeting with the Consultant that was held on 14th to 15th January, 2013 in Lagos, our representatives (of the two in-house unions) on the computation of terminal/severance benefits, r e p o r t e d f u n d a m e n t a l observations/errors in the computation as follows: the s a l a r y s c a l e u s e d i n computing Gratuity is not PHCN Salary scale as at June 2012, as agreed with negotiation team under the leadership of SGF. Souvenir entitlement was omitted in c o m p u t a t i o n o f t o t a l entitlements, as agreed with
PHCN workers still unhappy over terminal benefits … Petitions power minister
Victor AHIUMA-YOUNG
Comrade Hassan Sumonu Committee, in compliance with our 2010 Conditions of Service. The variables used in the formula for annuity by the consultant are not realistic: (a) interest rate, (b) inflation rate (c) discount rate, and (d) life expectancy of each staff. Alexander Forbes used:
?5% as inflation rate (pension increase), instead of current rate of 12.5%.
?14% as discount rate, while
the current rate is 11%. The data used for all staff are
not correct in addition to u n c l e a r a s s u m e d l i f e expectancy of each worker.”
According to SSAEAC, “We are left with no option than to bring this to your notice, for i m m e d i a t e r e d r e s s b y directing the Consultants through the BPE to correct these abnormalities to enable the reform to go on as planned. While our Union and staff re-affirm our conditional acceptance of Government reform despite our preferred position, we will not allow our members to be cheated. Any attempt to the contrary of the agreement reached will be resisted by the workers. It is in the light of the above that we were s u r p r i s e d a t t h e announcement of a N384 billion approval by the
Federal Executive Council as representing total terminal b e n e f i t s t o P H C N Employees.”
“This announcement was grossly misplaced because the A lexander Forbes Consultant engaged by BPE, had not concluded his assignment and no figure had been emanated from his work. We do not understand the rational for announcing such a figure. It should be noted also that, only the Unions as representatives of the workers can confirm the basis of computations while individual staff will verify their data. The proposed issuance of statements of workers’ terminal benefits at t h e exc l u s i o n o f o u r Association headquarters by BPE wi l l be counter-productive. The earlier this verification of staff data is
done the better for progress of the reforms. We remind the government that our support for the reform is conditional upon the final settlement of all labour liabilities, hence the long period of negotiations and the resultant Agreement which upheld our Condition of Service 2010.
It would be recalled that barely 24 hours after the government said it had approved N384 billion for t h e p a y m e n t o f a l l entitlements of workers of PHCN, and process of the payment expected to begin a day after (21-02-13), NUEE r e j e c t e d g o v e r n m e n t position, threatening to shut down the industry, should government fail to reverse its position and perceived provocative utterances.
PHCN Workers
25Insurance
Apremium no cover’ s the ‘no directive of the N a t i o n a l I n s u r a n c e
Commission, NAICOM, gathers steam, stakeholders are of the opinion that the buy-in of oil majors is vital to its success
The oil and gas sector all along, has been the main stay of the Nigerian economy. However, activities in the oil and gas sector are yet to translate into a significant growth of the insurance industry. This is because the statutory requirement that insurers must underwrite 70 per cent of oil and gas risks emanating from the energy sector is yet to be achieved.
Although insurers are yet to achieve the 70 per cent coverage, stakeholders are of the opinion that the ‘no premium no cover’ mandate will impact positively on oil and gas risks underwriting if the oil majors adhere to it, irrespective of the capacity level of insurers.
According to experts, oil majors must pay insurance premiums in advance and not in installments, because they are not exempted at all from the ‘no premium, no cover policy.’
The new premium regimeSince the new premium
regime took effect from January 1, this year, it has received the support of the g o v e r n m e n t , a s a l l ministries, departments, agencies and stakeholders have been advised to ensure strict compliance.
It will be recalled that the Ministry of Finance issued a c i r c u l a r t o F e d e r a l Government’s Ministries, Departments and Agencies (MDAs) to adhere to the implementat ion of ‘ no premium, no cover’ policy.
NAICOM, had late last year issued a circular stating that f r o m J a n u a r y 1 , a n y underwriting firm that provides insurance cover without col lect ing the
Will oil majors adhere to ‘no premium no cover’ regime?Rosemary ONUOHA
premium would be liable to a penalty of N500, 000 or lose its license.
According to the circular, all insurance covers shall only be provided on a strict ‘no premium no cover’ basis and that only cover for which payment has been received, directly by the insurer or indirectly through a duly licensed insurance broker, shall be recognised as income in the books of the insurer.
It said irrespective of period of insurance, insurers shall ensure that at any point, they have received directly or indirectly, through the insurance broker the full premium in advance for cover being granted.
NAICOM noted that all brokers should within 48 hours of receiving premiums
on behalf of any insurer, notify the insurer in writing in each case, of the receipt of such premium, adding that all such n o t i f i c a t i o n s h a l l b e accompanied by the broker’s credit notes, acknowledging indebtedness to the insurer. It said upon the receipt of such credit notes, the insurer shall issue cover and forward the policy documents along with the related debt notes to the broker, adding that any broker who fails to notify the insurer of any premium received on his behalf shall be liable to a penalty that is not less than N250,000 in each case of failure to notify.
NAICOM further mandated insurers to notify it, not later than 30 days from the end of every quarter, of all premiums acknowledged as having been received by brokers or lead
insurers, but not remitted to them, adding that any insurer who fails to render such return, shall be liable to a penalty of N5000 for each day of default.
Insurers and brokers were asked to reconcile their accounts not later than March 31, 2013 and brokers and lead insurers are to notify the commission of premium received and un-remitted to insurers, not later than 30 days from the end of every quarter.
Expectations from oil majors
To give bite to its bark, NAICOM said that the oil majors have no reason not to adhere to the new premium regime, adding that previous court’s rulings would aid its legal strength to push the new premium regime to
success.C o m m i s s i o n e r f o r
Insurance, Mr. Fola Daniel, said that settled Appeal Court cases on the issue of insurance premium are clear indications that anything short of full payment at the c o m m e n c e m e n t o f a n insurance contract renders such transaction null and void ab initio.
Daniel said “The Provision of Section 50 (1) of the Insurance Act 2003 which states that, ‘The receipt of insurance premium shall be a condition precedent to a valid contract of insurance and there shall be no cover in respect of an insurance risk, unless the premium is paid in advance’, is indeed in the interest of the insured, going by decided cases on the issue by competent court of law.
Executive Director of Crystalife Assurance Plc, Mr Teju Ogunjimi; Managing Director of the company, Mrs Seyi Ifaturoti ; President of NCRIB, Barrister Laide Osijo and Executive Director of Crystalife, Mr Owolabi Salami during a courtesy visit on NCRIB by management of Crystalife, recently
26Insurance
Staco Insurance plc has set in m o t i o n a l l s t r a t e g i e s w i t h i n t h e
ethical l imits to gross premium income of not less than N8.5 billion in the current year 2013, as against N6.7 billion generated in 2012.
The company’s Managing Director Mr. Sakiru Oyefeso, hinted during an interaction with journalists in Lagos recently that, though it is difficult make premium pro jec t ion due to the enforcement of “no premium, no cover” law contained in section 50 of the Insurance Act 2003, the insurance company has a guide it is working with.
He said “Projection is very difficult to work on with this new law until the dust is settled. However, we have a guide to operate with. Last
Staco Insurance targets N8.5bn premium income
Favour NNABUGWU year, we end our business with N6.7 billion gross premium income. This year, we believe we should grow to N8.5 billion. But with the new trend of activities going now, it could be hard.”
Oyefeso added that the insurance outfit is, however, optimistic of meeting its premium target especially as “there could be opening in the economy with the seriousness of the Federal Government that the energy sector will come up, road network will be good, and there will be provision of potable water in all nooks and crannies of the country. These are all gigantic projects that will need insurances. These are the areas that could help the insurance indus t r y to generate more income. The oil and gas is there for us to take advantage of too.”
Again, as individuals are getting more aware of the need to buy insurance policies, the Staco boss
stated that more members of the insuring public might eventually buy into the existing micro-insurance products before long.
He also explained that the
change of the company’s name from Standard Trust Assurance plc to Staco Insurance plc during the last re-capitalisation exercise in the nation’s insurance industry which ended in February 2007, has also helped the insurance outfit to become a household name in the country.
The Staco boss further stated that the company is not resting on its oars because “We cannot say we have got to maturity, we are still in the process. It takes a longer time to get there. We want to see this company living like Nigeria to reach 100 years and beyond like First Bank.”
To improve on the fortunes of the insurance company in the market, Oyefeso stressed that the organisation has put in place what it called seven “S”, adding that if the seven “S” are pursued vigorously and nobody changes the game, Staco will be better for it at the end of the day.
We cannot say we have got to
maturity, we are still in the
process. It takes a longer time to
get there. We want to see this company living like Nigeria to
reach 100 years and beyond like
First Bank
a y e l s a n s h a d cause to smile recently as the B
management of Agbami Deep Water Oil Project, a j o in t p ro jec t o f the Chevron, Famfa Oil , Statoil, Petroleo Brasileiro and the NNPC, donated a s c i e n c e l a b o r a t o r y building for St Jude’s Girls Secondary School in Amarata, Yenagoa to boost science education.
The Agbami Field is located approximately 70 miles (133km) offshore Nigeria and contributes over 250,000 barrels of oil per day to Nigeria total oil production.
T h e c o m p a n y a l s o donated a chest clinic for t h e L e p r o s y a n d Tuberculosis hospital in Yenagoa. The chest clinic and science laboratory building projects are part of the operators’ social r e s p o n s i b i l i t i e s t o communities in its area of operation.
The Director, Deepwater and Production Sharing Contracts of the joint venture, Mr. Ken Sample, said the donations were a demonstrat ion of i ts c o m m i t m e n t t o conducting their business in Nigeria in a socially responsible manner.
Mr. Sample said the chest clinic and science l a b o r a t o r y b u i l d i n g constitute an aspect of the strategic intervention plan of the Agbami partners in the education and health sectors of the nation.
According to Sample, “From Lagos, Ondo, Delta, B a y e l s a K a d u n a , Maidugur i and Por t H a r c o u r t , A g b a m i partners have added values to the lives of Nigerians and several other projects are on-going.” The partners, he said have inst i tuted specialised educational scholarship programme in s u p p o r t o f h e a l t h manpower development in the country through targeted support for m e d i c a l , n u r s i n g , laboratory sciences and engineering students.
Samuel OYADONGHA
Chevron donates science lab in Bayelsa
Insurance policies files
27Maritime
THE Federa l G o v e r n m e n t through the Nigerian Ports A u t h o r i t y
(NPA) has commenced moves to develop three deep sea ports across the country with a view to growing the economy. Disclosing this in Onne, near Port-Harcourt, Information Minister Mr Labaran Maku, said that the government was partnering with private investors to b r i n g a b o u t t h e s e developments because, that, according to him is the only way to grow the economy.
Maku who visited the on going port extension work at the Federal Ocean Terminal currently being operated by Intels, also disclosed that the firm will hand over the facility to NPA after twenty years, so as to allow for enough time for the investor to recoup its investment. He explained that the new strategy by government to partner the private sector was paying off as the construct ion work has remained consistent unlike w h e n g o v e r n m e n t contractors are made to handle these kinds of jobs.
“We are doing a prime project for the economy of Nigeria, this port covers about 90,000 hectares of land which is a huge area and you can see the land reclamation going on it is all part of the port project. In less than one year, this contract has been virtually executed to about 70% percent and it will be completed in August and you can see because this is government private sector partnership (PPP) you can see the speed at which the project is being executed.
“If it were an entirely government contract , contractors will wait, they will delay, they will bring back papers for re-validation and they will keep working for years, but this new
OLLOWING the scrapping of the FP r e s i d e n t i a l
I m p l e m e n t a t i o n Committee on Maritime Securi ty and Safety ( P I C O M S S ) b y t h e Jonathan Good Luck administration last year, the Nigerian Maritime Administration and Safety Agency (NIMASA), has given port faci l i t ies security operatives till July this year, to re- validate their security evaluat ion wi th the agency.
Disclosing this at the 64th edition of the Lagos Maritime Security zone of the Port Facility Security Officers (PFSO) Forum, Chairman of the Forum, Mr. Suberu Anataku said that the group was still watching events as they unfold adding that it will o n l y r e p o r t t o t h e designated government agency.
The group said that it will await the government t o m a k e a f o r m a l declaration on who the designated authority will be before it will make its move. It was gathered that since the Committee was scrapped, NIMASA has taken upon itself to evaluate safety and security equipment and procedures at the facilities within and around the ports.
It will recalled that before now, PICOMSS was responsible for this, and cer t i f icates are usually issued to facilities that passes the evaluation process. It was further g a t h e r e d t h a t t h e certificates issued by PICOMSS were supposed to expire in December, but the Maritime agency has made these certificate i n v a l i d b y i t s pronouncement of the July deadline.
W h i l e t h e f o r u m recognise the fact that P I C O M S S h a s n o legislative backing, but that it assisted members of the group in facing their security challenges in the port.
NIMASA gives security operatives deadline on PICOMSS
Godwin ORITSE
Godwin ORITSE
FG moves to harness sea ports for economic development
strategy to engage the priavte sector to develop our ports is really working.
This port as it were, still has phase 4B, which will follow as the concluding part of the port project. Intels will manage this port for twenty years and recover its money so government has not invested any thing in this port and that is indeed a good policy of government.
“The infrastructures of the fast growing economies are provided by the private sector, all the government do
is to provide the legal framework. He noted that every aspect of the Nigerian economy is crying for attention as the economy grows and that government does not have the funds to do all of these at the same time, so the need for private sector participation.
Maku stated that the government will continue to use the private sector for the purpose of developing the economy.
The information Minister stated that it was the vision of
government to make Nigeria the leading economy in Africa in the two or three decades. He however urged the media to continue to monitor these on going projects and report the development as they unfold.
Meanwhile, the Managing Director of the Nigerian Ports Authority (NPA) Mr. Habib Abdullahi, said that the project was in response to the upsurge in maritime operations at Onne Port C o m p l e x d u e t o t h e increasing need to serve the oil and gas sector in West and Central Africa.
Seaport
28Maritime
TH E F e d e r a l G o v e r n m e n t t h r o u g h t h e M i n i s t e r o f T r a n s p o r t ,
Senator Idris Umar last month inaugurated the boards of the Nigerian Ports Authority (NPA) and the Nigerian Maritime Administration and Safety Agency (NIMASA) where Chief Tony Anenih and Lt Col Agbu Kefas were appointed to chair the boards o f N PA a n d N I M A S A respectively.
In this interview with SWEETCRUDE, Lt Col Agbu Kefas told Godwin Oritse that he was ready to assist NIMASA to achieve its objectives in the area of maritime security and safety.
Excerpts Congratulations on your
appointmentThank you very muchWhat is your vision for
NIMASAAlready, the management
has a vision , we will not change the vision because it is a positive one. What we will do is to support the current management in whatever way we can to ensure that the purpose for which the agency was set is achieved.
So what we are going to do as board or team is to give them all the necessary support to re-energize them and encourage them to achieve that goal.
There is this talk in the military circle that you were dismissed from the Nigerian Army because of your involvement with some militants in the Niger Delta area and after a lot of pressure your dismissal was converted to retirement, how would you react to this?
Which quarter of the military? The records are there to show, I retired meritoriously and it was voluntary and if you look around you can see a lot of military officers both serving and retired.They came in r e c o g n i t i o n o f t h e appointment and to celebrate with me. So, if I was dismissed, nobody will be here so you do not need any rumor and the records are there and they are very straight. And you can see, do I look like some body that was dismissed? Most of the Senators you see here, came because of me, that is because I am a true Nigerian and it cuts across the entire country.
There is also this anxiety in the Military because they cannot understand why and how a Lt Col will be
We’ll support NIMASA to achieve its goals —Kefas
presiding over meetings where Generals and Rear Admirals are seated. What is your take on this?
My brother, during the military era, who were the military administrators I mean the Governors, what were their ranks ? I am a very senior officer in the military because from the rank of a major, you are a senior officer. If the President did not deem it fit to appoint me, it means I was never qualified in the first place. Even you as a young man, are you not happy for me that a young man like yourself is getting appointed to this kind of office ? To see a young man like you being appointed to head the board of NIMASA means that there is hope for this country.
Let’s be positive and work together to make this country
great, let us not work on rumor.
Between the time you were appointed and now, you must have taken some notes, more so that you have watched NIMASA from afar , what would you want to quickly address ?
First and foremost, when you get to a place, there must be attitudinal change, you have to create awareness, make people to be positive minded in their jobs, you have to make sure that they are committed. What we intend to do is to bring everybody together and drive the agency together, it is a team work. When we start working as team, we can now begin to address issues together.
First and foremost, when
you get to a place, there
must be attitudinal
change, you have to create
awareness, make people to
be positive minded in their jobs, you have to make sure that they are committed
Lt Col Agbu Kefas
HE management of the Nigerian Ports Authority, T
has assured the Nigeria Liquified Natural Gas Company, NLNG, of its continued support in the Maritime Industry and called for a sustained relationship that will be b e n e f i c i a l t o b o t h organisations.
Speaking in Lagos Managing Director of NPA Mal lam Habib Abdullahi made this declaration when he received a delegation from the NLNG Company which paid him a visit in his office in Lagos.
He commended the c o m p a n y f o r i t s contributions to the deve lopment o f the nation’s seaports and the maritime industry in general and pledged that the Authority will fulfil its o b l i g a t i o n s t o a l l s takeholders in the industry.
Represented by the E xe c u t i v e D i r e c t o r, Marine and Operations, E n g i n e e r D a v i d O m o n i b e k e , t h e M a n a g i n g D i r e c t o r assured the delegation that management will soon visit Port facilities in the Bonny Island for on the spot assessment of the situation.
Engineer Omonibeke d i sc losed tha t NPA M a n a g e m e n t i s intensifying its plans to ensure an e f fec t ive succession plan of its ageing marine personnel which includes the pilots a s w e l l a s t h e establishment of Vessel Tra f f ic Management I n f o r m a t i o n Ser v ices [VTMIS] a t Bonny to enhance safety o f n a v i g a t i o n a n d protection of the marine environment.
Earlier, the leader of the delegation and Deputy Managing Director of the company, Mr. Basheer Koko had listed Pilotage, training and certification o f p i l o t s , c h a n n e l m a n a g e m e n t , J e t t y maintenance and traffic management, light house management etc. as critical operational issues which NLNG wants NPA to look into in order to ensure smooth operations in Bonny Island.
NPA assures NLNG of improved economic relations
29
The people of O t u m a r a C o m m u n i t y, Warri South L o c a l
Government Area of Delta State, have asked the Shell Petroleum Development Company Limited, SPDC, to halt a proposed gas plant project in the area, or, on the alternative, give them adequate compensation to relocate, before the company can go ahead to site its proposed gas plant in the area.
T h e p e o p l e o f t h e community who spoke through their Chairman, Mr James Edun, Spokesman, Pastor Alade Omaejile, Women Leader, Mrs Grace Odogene and P.R.O., Pastor
I L a n d g a s landowners in Othe Niger-Delta
r e g i o n , u n d e r t h e platform of Association of Family of Oil and Gas Producing Community, ASFOGAPCOM, have criticized multi-national oil majors for alleged willful connivance with community leaders to deprive them of their legitimate rights and privileges.
Addressing reporters in Warri, Delta state, after a m e e t i n g o f t h e association, the National President, Mr. Joseph Abinogun, said, “The oppressive pract ice , which is now snowballing into a threat to the lives and soc io -economic interests of oil and gas landowners, is even made w o r s e b y t h e acquiescence of Nigeria Petroleum Development Company, NPDC, an indigenous oil major.”
The association said the S h e l l P e t r o l e u m Development Company, SPDC, NPDC and NNPC and other oil majors “should start dealing directly with landowners as against the obtainable practice where they had established dealings with host community leaders to the exclusion and disadvantage of oil and g a s l a n d o w n e r s . ” Alleging that NNPC had “ridiculously abdicated its supposed obligatory role , which ideally, s hou ld i nc lud e t he protection of rights and privileges of grassroots s takeholders in the Nigerian oil and gas industry”, it said, “If the oil majors are not dealing fraudulently, they should know their landlords and show them respect.”
“ D i r e c t d e a l i n g , including exchange of c o r r e s p o n d e n c e s , relevant information, negotiation of all sorts, as a matter of fairness, should be entered into directly with oil and gas owners, and not the other way round,” Abinogun asserted.
Oil, gas landowners berate oil majors
Community halts Shell gas project… Demands adequate compensation
Simon ADEWALE We y i m i F u l u d u , a r e requesting Shell Petroleum Development Company to pay a minimum of N25,000 per meter square, instead of N4,500, which the Company has proposed to pay them to vacate their residents which would be demolished to serve as site for the proposed gas plant which SPDC intends to site in the Community.
They have called on the company to follow the example of the Niger Delta Development Commission, NDDC, the Delta State Oil P r o d u c i n g A r e a Development Commission, DESOPADEC and the Delta State Government, that pay up to N120,000 per square meter to owners of properties usually demolished in construction sites, and said u n l e s s S P D C m a k e s
adequate compensat ion which would be enough for them to bui ld another b e f i t t i n g h o m e s f o r themselves, they would not vacate the community for the proposed gas p lant to commence.
It would be recalled that SPDC, in year 2000, proposed to site a gas plant in Otumara Community. Consequent upon the development, the company forwarded an E n v i r o n m e n t a l I m p a c t Assessment (EIA) to the F e d e r a l M i n i s t r y o f Environment for approval. Reacting to the EIA, copies which were made available to the press, the people of the community have alleged that SPDC, contrary to Article 11 Section 2 of the International Convention on Economic, Social and Cultural Rights, of the United Nations, the
company omitted “social, e c o n o m i c , p h y s i c a l , biological and hydrological impact which the gas project shall place on the immediate Otumara Community, and which avail the people of their rights to adequate compensation, an act which the people of the community have accused SPDC of deliberate witch-hunting”.
They also alleged that SPDC recently approached them to relocate, following approval of the EIA, by the Federal Government, “with the intention to pay them a token compensation of N4,500 per meter square for properties to be demolished, which the communi ty rejected”, insisting they must be paid N25,000 per meter square which is adequate for them to build a n o t h e r h o m e s f o r themselves.
Gas plant
30Community
WITH the wave of kidnappin g i n D e l t a
State and his refusal to sign into law the death penalty bill on kidnappers, passed by the state House of Assembly, not a few Deltans were beginning to wonder what the feasible plan, if any, the Governor, Dr. Emmanuel Uduaghan, has to combat the menace.
His ban on motorcycle, otherwise known as okada transportation in Asaba, the state capital, Warri and Effurun, helped to stem the tide in the three cities, but kidnappers took their trade to nearby Sapele, Ughelli and Oleh. In fact, it is as if the more the government beefs up its strategy to curtail kidnappers, the deeper kidnappers extend their tentacles.
While the government inaugurated a specia l securi ty task force in addition to the joint and separate teams of army and police officers patrolling the state, the governor has
O R T H A R C O U R T: S I X T Y f o u r P
trainees have graduated from the technical skills acquisition programme sponsored by Addax P e t r o l e u m N i g e r i a Limited at the Federal College of Education, Technical, Omoku in Rivers State.
S p e a k i n g a t t h e graduation ceremony, Managing Director of the oil firm, Chief Cornelis Zegelaar , said 114 youths were enrolled for various s k i l l s a c q u i s i t i o n programme in December 2011, while 64 graduated in programmes ranging from welding/fabrication, c o m p u t e r s t u d i e s , c a t e r i n g , e l e c t r i c a l installation/automobile mechanics and fashion designing. Adding, he said the graduands would be given starter packs and take- off grants of one h u n d r e d a n d f i f t y thousand naira each.
While appealing to them to use the fund wisely, Chief Zegelaar said they should deploy the skill g a i n e d f r o m t h e programme to firmly establish themselves. A c c o r d i n g t o t h e Managing Director, the firm had invested five hundred and fourteen million [514] naira in various training and e m p o w e r m e n t programmes for four hundred and sixty youths. He said the firm also awarded two hundred and ninety one university scholarships annually to students.
On his part, Provost of the Federal college of Education, Dr Nkasiobi Oguzor, charged the graduands to shun the temptation to sell the starter packs just as he commended the oil firm for sponsoring the youths. He urged the graduands to fur ther embrace the opportunity to be self reliant and active in the entrepreneurial world.
Addax trains 64 on skills acquisition
Jimitota ONOYUME
Uduaghan fortifies waterways against kidnappers, oil thieves
Emma AMAIZE
b o l s t e r e d t h e D e l t a Wa t e r w a y s S e c u r i t y Committee, DWSC, Warri, to provide security agencies w i t h i n t e l l i g e n c e i n f o r m a t i o n t o f i g h t kidnappers and oil thieves in the creek.
D W S C i s t h e f i r s t committee that Uduaghan inaugura ted when he assumed office as governor in 2007, and the group assisted in no small measure in stemming the tide of kidnapping in the creek.
However, k idnappers
shifted their activities from the waterways to the land when the creek became a no go area because of the wide tentacles of the committee, which assisted the military to recover arms seized from soldiers by militants before it was quietly dissolved.
T h e c o m m i t t e e w a s disbanded because of the new challenges that made land the new operational field of kidnappers and other security reasons. A source said it did not want duplication of efforts a n d s o , g o v e r n m e n t strengthened the army and police to take up more responsibilities in that regard.
However, owing to recent developments, the governor re-strategized and expanded the committee to rev his peace a n d s e c u r i t y a g e n d a . Speaking through his deputy, Prof Amos Utuama, SAN, while reconstituting the committee at Government House annexe, Warri, he said government would hold members of the committee responsible for any security breach in their areas. He, therefore, urged them to take their assignment, which is p r o v i d i n g i n t e l l i g e n c e information to security agents seriously.
Even though DWSC is not an arms-bearing outfit, he said it had the mandate to i n t e r v e n e i n c r i t i c a l situations to maintain peace, whether in the riverside areas or land. His words, “You are the eyes of the g o v e r n m e n t i n y o u r respective areas and you will be held responsible for any security breach in your area. Sleep with your head, but your eyes must be open.”
“We have decided to step up the security measures in the state through this c o m m i t t e e . S e c u r i t y concerns everybody. All hands must be on deck to address security challenges in Delta State. Members of this committee have the responsibility to oversee security in the land as well and they are to intervene once there is a threat,” he said.
“We know your track records. Ensure that there is peace in Delta State for development to take place. Once the state is fully developed, it will generate wealth and create job opportunities for our people and so you should know that your job is very vital, “he added.
Security concerns
everybody. All hands
must be on deck to address security
challenges
Arrested Kidnappers
31Community
The Anglo-Dutch oil giant, Shell P e t r o l e u m Development C o m p a n y
(SPDC) has empowered 20 youths drawn from the disputed oil rich communities of Nembe in Bayelsa and Kula in Rivers State, with life-sustaining skills as part of measures aimed at boosting capacity and increasing wealth portfolio in the Niger Delta.
The oil giant also helped the beneficiaries, who are mainly young women, to establish small scale businesses that would enable them cater for themselves and their families for life. Receiving their certificates of merit and business starter packs in Yenagoa, the beneficiaries of the LiveWIRE Business Enterprise Training for “Swamp 2” host communities of SPDC Eastern Operations
ARRI-LAND OWNERSHIWP tussle is set
to frustrate the proposed N173bn methanol plant by Gulf of Guinea in Nigeria.
The Gulf of Guinea Oil Explora t ion L imi ted (GGOEX) $1.1billion dollar investment in Delta state is to be constructed at Aja-Edede, Ugborodo, Escravos, Warri South-West council area of Delta State. But the facility with a capacity of 1.8million tonnes and provide two p e r c e n t o f g l o b a l methanol production, is already facing legal battle in the Effurun High Court i n S u i t N O : E H C / 1 8 9 / 2 0 1 0 : Yonwuren & others Vs Shell & others.
The suit is challenging the right of any company or establishments to use Aja Edede land without prompt and adequate compensation to the host community of Aja Edede. In a public notice by counsel to the Edede families in Ugbuwangue, Chief Pius Egomole of Inkeiruka Chambers, Warri, the plaintiff stated that they “will not permit any other interloper to enter their native land without first settling them”.
I n a V a n g u a r d publication on February 5, 2013, they maintained that “Aja Edede is not Ogidigben or Ajudaibo”, saying that “it is a community of its own”.
Reacting to the claim, the Ugborodo Community Trust Vice-Chairman, Mr. Isaac Botosan and the Public Relations Officer, Chief Ayiri Emami said “no single family own a land in Ugborodo”, noting “that all Ugborodo land belongs to Ugborodo people”.
They called on every stakeholder, government and investors to disregard the claims by the Edede family.
N173bn methanol plant in jeopardy over land disputes
Emma ARUBI
Shell empowers Bayelsa, Rivers youths with skills Samuel OYADONGHA
w e r e f u l l o f j o y a n d e x c i t e m e n t a s t h e y commended the company for engineering a turn-around in their lives.
Speaking at the graduation ceremony, SPDC Manager, G o v e r n m e n t a n d Community Development Relations Bayelsa/Delta, Mr. Evans Krukrubo , said the scheme was designed in line w i t h t h e c o m p a n y ’ s philosophy of contributing to economic empowerment and job creation for youths and women in i ts area of operation.
He said, “The LiveWIRE programme, which has trained over 5000 youth and women entrepreneurs since 2003, aims to provide access to entrepreneurship training, bus iness deve lopment services as well as start-up capital to establish and
e x p a n d y o u t h - d r i v e n businesses.”
According to him, “the beneficiaries of the scheme h a v e n o w c r e a t e d employment opportunities for thousands of youths across t h e r e g i o n , t h e r e b y contributing to the reduction of youth unemployment in the region.”
Also speaking, Mr. Hope N o u k a , M a n a g e r , Sustainable Development and Community Relations, described the programme as a critical step towards the qualitative empowerment of the youths in the region.
He urged the participants to utilize the skills acquired by putting starter packs given to them into good use to improve their individual lives and the advancement of their families and communities.
In his remarks, the state
commissioner for Energy, Mr. Francis Ikio, thanked SPDC for empowering the youths and charged the p a r t i c i p a n t s t o t a k e advantage of the opportunity to excel and empower others desperate to acquire similar skills, own and manage their independent businesses.
R e p r e s e n t e d b y t h e Permanent Secretary in the ministry, Mr. Prekake Gede, the commissioner however noted that the oil giant cannot achieve sustainable development in the region w i t h o u t t h e a c t i v e collaboration of other actors i n d e v e l o p m e n t . H e , therefore, charged other major players to fashion viable partnerships aimed at delivering on the needed s o c i a l p e r f o r m a n c e commitments to achieve the d e s i r e d i m p a c t a n d sustainability.
Skill Acquisition Centre
Sweetcrude is a Publication of VANGUARD MEDIA LIMITED, Vanguard Avenue, Kirikiri Canal, P.M.B.1007, Apapa. Website: www.vanguardngr.com (ISSN 2251-0001) Editor: CLARA NWACHUKWU . Phone: 08098051103, All correspondence to P.M.B. 1007, Apapa Lagos.