Petroleum engineers want deployment of technology to curb oil theft

The Society of Petroleum Engineers (SPE) Nigeria Council says deployment of modern technology can assist in curbing crude oil theft in the country.

Mr Tunji Akinwunmi,  Chairman, SPE Nigeria,  made the assertion while speaking with newsmen  in Lagos on Wednesday.

He spoke ahead of the council’s 2021 Oloibiri Lecture Series and Energy Forum (OLEF) holding on  March 18 in Abuja.

Akinwunmi said that some operators had started utilising drones and other modern gadgets to monitor pipelines and petroleum infrastructure.

He said that  it needed to be expanded and sustained.

Akinwunmi said that the COVID-19 pandemic had negatively affected the oil and gas industry, hence the need to improve on operational excellence and portfolio optimisation going forward.

According to him, both factors can help to reduce the Unit Operating Cost (UOC) of producing crude oil in Nigeria which the government targets to be not more than $10 per barrel by December 2021.

Akinwunmi also noted that the passage of the Petroleum Industry Bill , currently before the National Assembly, would stimulate more activities in the oil and gas sector.

He said it would maximise opportunities for the benefit of the country.

On the 2021 OLEF,  he said Chief Timipre Sylva, Minister of State for Petroleum Resources; and Mr Mele Kyari ,Group Managing Director, Nigerian National Petroleum Corporation; were among stakeholders expected at the hybrid event.

He said also expected as keynote speaker is  Director, Department of Petroleum Resources, Mr Sarki Auwalu.

Akinwunmi said the lecture would look at reducing overall cost of doing business through digitalisation, reevaluation of operational strategies, deployment of local technology and entrenchment of good governance.

The SPE chairman said over 3,000 participants from the industry, government and academia are expected to participate in the lecture both online and offline. (NAN)

Dangote Refinery coming on stream (Pictures)

Ex-trade minister backs full deregulation of petroleum downstream sector

Mr Okechukwu Enelamah, former Minister of Industry, Trade and Investment, on Thursday said the full deregulation of the petroleum downstream sector would allow the industry to reach its full potential.

Enelamah also advised the Federal Government to look for a win-win solution to the issue of removal of petrol subsidy, being the right thing to do from an economic perspective.

The News Agency of Nigeria (NAN) reports that Enelamah spoke at the 18th Annual Memorial Lecture of Chief Aret Adams, the first Group Managing Director of the Nigerian National Petroleum Corporation (NNPC).

The lecture  had as its theme: “Total Deregulation of Nigeria’s Downstream Oil and Gas Sector: Challenges and Opportunities.”

The former minister, who chaired the lecture, said  a lot of capital would be freed up for developmental purposes if the sector was fully deregulated.

He noted that the deregulation of the telecommunications sector which had transformed to a $20 billion industry in less than 20 years was a pointer that same could be achieved in the petroleum sector.

According to him, true competition, independent market regulator, consumer protection and investor protection are some of the factors that can help achieve a fully deregulated petroleum sector.

Delivering his lecture, Mr Tunji Oyebanji, Chairman, Major Oil Marketers Association of Nigeria (MOMAN), said Nigeria lost $13 billon in 2019 to non-functional refineries.

Oyebanji noted that if the four NNPC refineries were operating at optimal capacity, Nigeria would have imported only 40 per cent of what it consumed in 2019.

He said : “Full deregulation of the downstream sector remains the most glaring boost to potential investors in this space.

“Total deregulation is more than just the removal of price subsidies, it is aimed at improving business operations, increasing the investments in the oil and gas sector value chain and resulting in the growth in the nation’s downstream petroleum sector as a whole.”

Oyebanji said that though the government had announced the removal of petrol subsidy in March 2020, with the price of crude  oil above $60 per barrel, the N162 the product was currently being sold was below the landing cost.

He said NNPC as the sole importer of petroleum products was currently defraying the cost through ‘under recovery”, stressing that this was not sustainable in the long run.

The MOMAN chairman also disclosed that Nigeria had the cheapest fuel price among its African neighbours, which encouraged smuggling of the product across its borders.

He said deregulation would increase more investment especially with the taking off of the African Continental Free Trade Agreement (AfCFTA) which would give Nigerian businesses opportunities to expand.

Oyebanji said the coming of stream of the 650,000BPD Dangote Refinery, Bua Group Refinery, Waltersmith Refinery and others would transform Nigeria into a net exporter of crude oil  in the near future.

In his address of welcome, Mr Charles Osezua, Chairman, Board of Trustees, Aret Adams Foundation, said the late NNPC boss had over 32 years ago championed the campaign for full deregulation of the downstream sector.

“Aret fought for the removal of subsidy and wanted to release the creative and entrepreneurial capacities of Nigerians.

“There was resistance which led to his removal as the GMD which was termed ‘national interest’, but 32 years later, the discussion of subsidy removal remains topical and emotive, ” Osezua said. (NAN)

Passage of PIB will unlock several midstream gas opportunities - Sylva

 Chief Timipre Sylva, Minister of State for Petroleum Resources says the passage of the Petroleum Industry Bill (PIB) into law will unlock several midstream gas opportunities and enhance domestic gas utilisation.

Sylva said the Federal Government was also ready to collaborate with all stakeholders to initiate national activities that would make Nigeria actualise its declaration of 2021-2030 as the ‘Decade of Gas Development’.

The News Agency of Nigeria (NAN) reports that Sylva spoke on Thursday at the ongoing 12th Nigerian Gas Association (NGA) International Conference 2021.

The conference had the theme: "Powering Forward: Enabling Nigeria’s Industrialisation via Gas."

The minister who was represented by his Technical Adviser, Gas Business and Policy Implementation, Mr Justice Derefaka, noted that Nigeria's

over 200TCF proven reserves of natural gas must be utilised for economic growth and development.

He said: Our efforts will continue to focus on gas to transmute Nigeria from the conventional dependence on white products to a cleaner, more available, accessible, acceptable, and affordable energy use in gas. 

"This will not only cushion the effects of current deregulation but also create enormous job opportunities for Nigerians. 

"For this reason, we are proposing grand fathering in the new PIB.

The proposed PIB now before the National Assembly when passed into law will also unlock several midstream gas opportunities to further enhance domestic gas utilisation

"The revised PIB framework is based on core principles of clarity, dynamism, neutrality, open access and fiscal rules of general application. "

According to him, the priority of  President Muhammadu Buhari's administration is the

development of Nigeria’s vast gas resources and strengthening of the gas value chain as encapsulated in the National Gas Policy of 2017. 

Sylva said the president had outlined

some strategic priorities for the ministry aimed at stimulating  the sector to foster the sustainability of the Nigerian economy, enhance energy availability, create well paid jobs, and take millions of Nigerians out of poverty.

"As a government, we are pursuing programs to grow our gas economies through the development of industrial and transport gas markets, in juxtaposition with gas-to-power initiatives," he added.

He listed the achievements of the government to include the construction of the 614km Ajaokuta-Kaduna-Kano (AKK) pipelines, inauguration of the National Gas Expansion Programme and the commencement of the Nigeria Gas Flare Commercialisation Programme. (NAN)

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NASS pledges support to quick completion of Dangote Refinery

The National Assembly Ad-hoc Committees on the Petroleum Industry Bill (PIB) on Tuesday pledged their support to the quick completion of the Dangote Refinery in Lagos because of its importance to the nation's economy.

The committees also assured Nigerians on the quick passage of the PIB which according to them would make the Nigerian oil and gas industry operate in line with global best practices and attract investors.

 

The committees made the pledge during an inspection visit to the sites of the Dangote Refinery, Petrochemicals Complex, Fertiliser Plant and Subsea Gas Pipeline projects in Ibeju Lekki, Lagos.

The lawmakers  were led  on the visit by Sen. Sabo Nakuda, Chairman, Senate Committee on PIB and Mr Mohammed Monguno, Chairman, House Committee on PIB respectively.

They were received by Mr Devakumar Edwin, Executive Director, Strategy, Capital Projects and Portfolio Development, Dangote Group.

Speaking with newsmen, Nakuda said refineries were part of downstream operations of the Petroleum Industry, adding that the committee intend to visit all the refineries in the country.

Nakuda said : "We were in Kaduna yesterday and today we are in Lagos. We will also go to Port Harcourt and Warri to know what the industry entails and what needs to be captured in the PIB.

"I am totally overwhelmed with what I have seen at the Dangote Refinery. 

Looking at this Investment here, it is unbelievable that a single individual can confront this project at this time of our economic life.

"I am sure that by this time this refinery come on stream that even our currency, the Naira is going to be strengthened because we are spending millions of dollars on importing petroleum products. 

"Here we have an edifice that can supply the country's petroleum needs and we as a National Assembly are going to make sure that we give him all the necessary support because it is like a matter of life and death.”

On the PIB, he said the lawmakers were working assiduously to ensure its passage within the next two months.

Also speaking, Monguno said the bill would make the nation's oil and gas industry competitive and attract the much need investments.

"The world is moving away from oil and gas towards renewables and as such there is need for us to maximise our potential that is yet to be exploited particularly with regards to crude and condensates," he said.

According to him, Nigeria has between 10 and 20 years to judiciously utilise its oil and gas resources to develop its infrastructure and transform the country's economy.

He lauded the President of the Dangote Group, Dr Aliko Dangote for having the foresight in embarking on the projects, adding that it would generate a lot of multiplier effects in the downstream sector.

"It will create employment for our teeming unemployed youths, 

diversify our economy and help us to boost our foreign exchange reserve," the lawmaker added.

On his part, Edwin lauded the commitment of the government and the legislature to pass the PIB this year.

He said the three million Metric Tonnes Per Annum Fertiliser plant would improve the agricultural sector and stop importation of fertiliser into the country.

Edwin noted that the 650,000-barrels-per-day refinery could meet 100 per cent of the Nigerian requirement of all liquid petroleum products and would have surplus for export.

"The refinery project will create 1,600 permanent jobs and 100,000 indirect jobs. It will save Nigeria over $9.8

9 billion annually through import substitution, " he said. (NAN)

Marketers seek FG’s intervention to halt hike in cooking gas prices

The Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM) has appealed to the Federal Government to urgently intervene in arresting the galloping hike in the prices of cooking gas across the country.

NALPGAM made the appeal in an open letter jointly signed by its Executive Secretary, Mr Bassey Essien, and its National Public Relations Officer, Mr Raphael Aguele, on Friday.

A copy of the letter which was addressed to Chief Timipre Sylva, Minister of State for Petroleum Resources, was obtained by the News Agency of Nigeria (NAN) in Lagos.

NAN reports that the price of 12.5kg of cooking gas has increased from N3,300 to N4,200 and N5,500 at retail outlets in the last few months.

NALPGAM appealed to the government to put in place a policy that would encourage full domestication of Liquefied Petroleum Gas (LPG), also known as cooking gas.

The marketers said every local producer of gas should be mandated to domicile all molecules produced in the country as against the situation of being a major exporter of gas produced as well as a major importer of gas.

“If all molecule of gas produced should be domesticated, the local markets will be adequately supplied and prices stabilised.

“By this way, the concerted efforts of the Federal and State government agencies to encourage the use of gas would not be in vain.

“Thus, we urge your urgent intervention to address the plight of stakeholders; else all the expansion programmes of the government would be an exercise in futility,” NALPGAM said.

The marketers noted that the government in line with its aspiration to deepen gas utilisation in Nigeria, had urged investors to harness investment opportunities in the entire gas value chain to bridge the gap in other domestic gas usage in the country.

They said the significant growth in local consumption of LPG had been hinged on many Nigerians converting to cooking gas for domestic and commercial uses.

According to NALPGAM, the country’s local consumption which hitherto stood at about 70,000 metric tonnes as at 2007 had grown to over one million metric tonnes as at end of 2020.

“A major challenge with LPG utilisation in Nigeria is the issue of inconsistent availability and ever galloping gas price with the attendant depot landing costs and other associated charges.

“The domestic availability has been skewed majorly to 65 per cent import dependence, while only 35 per cent has been attributed to local supply.

“The price of LPG has exponentially skyrocketed over the last few months.

The cost of LPG early in 2020 was N3.4 million per 20MT truck, but by December 2020, it had gone up to N5.4 million; N5.6 million in January, 2021 and N6 million per 20 MT by February.

“The galloping price increases have not only choked marketers but have also strangulated consumers, thus making a mockery of the whole gas expansion plan of the government,” the marketers said.

They noted that the gains made in the huge conversion rate to LPG usage which had moved the per capita consumption from 1.5kg to over 3kg have gradually reduced because of the domestic costs of LPG.

The marketers said a majority of users of LPG were gradually reverting to the use of kerosene and firewood with the obvious known health implications.

NALPGAM also alleged that LPG operations at the Nigerian Petroleum Development Company ( Oredo IGHF Plant), Ologbo, Edo State were dominated by “middlemen”.

They said: “These middlemen without identifiable LPG bottling plants are hawking LPG allocations from plant to plant for patronage at exorbitant prices.

“Equally, disturbing is the fact that gas plant owners in the Edo/Delta region with their verifiable large storage capacities have not been granted any off taker facility despite the location of the project in the region.” 

Nigeria will maximise AfCFTA opportunities with full deregulation of downstream sector, says NAC secretary

 Mr Francis Anatogu,  Secretary, National Action Committee for the Implementation of the African Continental Free Trade Area Agreement (AfCFTA) says Nigeria can maximise the opportunities of the agreement with full deregulation of the downstream sector.

Anatogu made the assertion while speaking with the News Agency of Nigeria (NAN) on Wednesday in Lagos.

NAN reports that Nigeria is among the African countries that has ratified the AfCFTA which began its implementation on Jan. 1, 2021.

The AfCFTA aims to redefine trade relations within African states and proposes creating a central market for goods and services, with free movement of people and investments across 54 countries.

Anatogu noted that refined petroleum products was Africa's number one import with African countries importing over $36 billion of petroleum products per annum.

He said: "So, Africa presents huge market for our oil and gas sector, especially the midstream and downstream sector.

"The very first step is for deregulation to happen and there is a level playing field for businesses to make investments.

"For the petroleum industry, without deregulation we will not be able to maximise the benefits of AfCFTA.

The first thing is to even get the marketers to even import and sell in Nigeria. 

"They need to feel confident to import petroleum products and sell in their home country before they can move to other African countries.

”What we now need to do as a country is to make sure that our businesses are best equipped to get into that market in Africa.What that means is that we need to encourage investments. 

”With deregulation, businesses are encouraged to invest because they know they can charge competitive prices and recover their investments."

Anatogu also harped on the need to create a level playing field for marketers and the Nigerian National Petroleum Corporation (NNPC) to create competition in the downstream sector.

He noted that while this could drive up the pump price of Premium Motor Spirit in the short term, it would eventually lead to stability as witnessed in the deregulation of other products like diesel.

Anatogu said: "What we have now is NNPC being the sole importer of products but we believe that if you allow it to float, the price might go up a bit in the short term but it will stabilise.

”With deregulation, if we look at the West African coast for instance, going to Cameron, Niger, Benin; imagine the number of Nigerian trucks that can be supplying these countries.

"Also, there are those that are concerned that if we allow deregulation that a lot of people will be impoverished.

 "The truth of the matter is that the amount of jobs it will create in the medium term far outweighs the risk of the short term spike."

While commending the government for removing subsidy on PMS, he noted that the increase in the pump prices had been marginal and due to market forces. (NAN)