Majorwaves Energy Report August 2020 by majorwavesenergyreport

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Majorwaves Energy Report AUGUST 2020, Vol 3 No 8

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Majorwaves Energy Report AUGUST 2020, Vol 3 No 8

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CONTENTS

Sylva, Kyari, Wabote hail SEPLAT as pride of indigenous operators, gas revolution strides

Eni Takes Steps to Cut Operation Costs by 1.4bn Euros in 2020

OPEC+ Plan to Increase Oil Production by August Could Backfire –Rystad

President Buhari Inaugurates Nigerian Content Tower, Pledges More Spend on Job Creation, Infrastructure

COVID 19: Oilserv Donates Medical Supplies To Enugu State Government

Mozambique, Total Plan to Export Gas by 2024

..Research shows this USS 40 barrel of crude, after refining, is worth close to USS2,500”

‘N43.24bn Ibadan Dry Ports Project Goes To FEC Soon’

NIMASA Boss Celebrates Berth Of Largest Container Vessel In Nigeria, Lauds NPA MD.

More than a glimmer of hope for Jobs, Poverty Eradication

Oladunni Owo President, WEOG

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Majorwaves Energy Report AUGUST 2020, Vol 3 No 8

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Globally, millions have moved from being furloughed to being laid off. There has been soaring numbers of bankruptcies such that large corporations aren’t spared as the toll of the 2019 novel coronavirus disease (COVID-19) continues to hit hard. However, World Bank Lead Economist for Nigeria, Marco Hernandez has argued that the unprecedented crisis requires an equally unprecedented policy response from the entire Nigerian public sector, in collaboration with the private sector, to save lives, protect livelihoods, and lay the foundations for a strong economic recovery. Should the nation not succeed at this quest, it will see the Nigerian economy slide into recession, particularly if Q3 ends negative. From all indications, Q2 numbers would be negative when released. The spiking cost of Nigeria’s debt profile has also reached a new high with the country’s debt service as a percentage of revenue rising to 99 per cent! Even more worrisome for businesses is the rising inflation, which is few notches from 13 per cent. So, it is understandable to see the government commit to revolutionary leadership in the oil and gas space in order to bring in all the accruable benefits from the number one revenue earner for the nation. What exactly is happening in this sector differently that could transform the fortunes of Nigerians as regards job creation, poverty eradication and general development of the country? Find answers to these and more in our August edition. Stay safe!

Jerome Onoja

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Editor’s Note Publisher Joshua Bretz Managing Editor Jerome Onoja Editor Margaret Nongo-Okojokwu Business Development Stanley Etim Taiwo Olamilekan Amicable Aluu Production Solomon Obande Toma Stephen Research Analyst Simon Olanipekun Correspondents: Lagos Ikenna Omeje Abisoye Vincent Emeka Enunwah Daniel Terungwa Chukwunonso Mordi Port Harcourt Arit Dan Stella Odogu US Omaya Joko UK Kunle Kazeem

Majorwaves Energy Report is published by Majorwaves Communications, 25B, Adebayo Doherty Street, Lekki Phase 1. Lagos Phone: +2349035477966 Email: info@majorwavesenergyreport.com www.majorwavesenergyreport.com

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INDUSTRY NEWS

Sylva, Kyari, Wabote hail SEPLAT as pride of indigenous operators, gas revolution strides By Margaret Nongo-Okojokwu

he Honourable Minister of State for Petroleum Resources, Chief Timipre Sylva; the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kyari; and the Executive Secretary, Nigerian C o n te n t D eve l o p m e n t a n d Monitoring Board (NCDMB), Engr. Simbi Wabote, have commended Seplat Petroleum Development Company Plc for its sterling leadership s the industry’s poster child and breathtaking impacts on the growth of the country’s oil and gas development in the past decade. Speaking at the maiden edition of SEPLAT Energy Summit held virtually on Thursday, the trio took turns to celebrate what they described as SEPLAT’s pacesetting role in the development of the country’s oil and gas development in the past decade. Listed on both Nigerian and London stock exchanges, SEPLAT is Nigerian leading independent indigenous Nigerian energy company. Sylva, who opened the summit themed ‘Business Sustainability and Strategic Leadership in Africa’ recalled the emergence of SEPLAT 10 years ago and declared that the company has demonstrated the capacity to drive the innovation and

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expertise required for local content development. He said that SEPLAT’s investment in gas development aligns with the National Gas Expansion Programme (NGEP), adding that the government has declared 2020 as “the year of gas”. He stated that the country has sufficient gas reserve to meet its energy need if the efficient utilisation and monetisation template of companies like Seplat is adopted by others. “On January 16, we inaugurated an Inter-agenc y Commit tee saddled with the responsibility of coordinating our concerted efforts to ensure the penetration of domestic utilisation of liquefied petroleum gas (LPG), encourage auto LPG, compressed natural gas and LPG for the domestic market. This will drastically reduce the massive outflow of the nation’s foreign exchange currently being expended in the importation of Premium Motor Spirit (PMS),” the minister said. Kyari, who lamented that Nigeria is a net importer of petroleum products, announced that SEPLAT is collaborating with NNPC “to create a splitter plant in short term” to address the refining challenge facing the country.

“There are other private initiatives. As we know, there are several licenses granted by the Federal Government for people to construct refineries, but they can’t do this because of the clear issue around the market structure. But thankfully, we have transited out of the regulated petroleum market into a deregulated market,” said the NNPC boss. Speaking during a panel session dubbed ‘The impact of Global Energy Transition on African Economies’, Wabote congratulated Seplat for surviving till its 10th anniversary, saying that the crop of the Board members, management and staff has contributed immensely to the feat. He added: “Seplat is a poster child of local content development in Nigeria. I want to congratulate its chairman, Dr. ABC Orjiako for having been steadfast to steer the ship to what we have today.” Earlier, in his welcome remarks, SEPLAT Chairman, Dr. ABC Orjiako declared that the event would be an annual platform for the company to continue to shape the narrative on relevant issues in the energy sector. He noted that at inception, Seplat became a trail blazer for indigenous participation in the oil and gas sector in Nigeria and had since recorded historic accomplishments in various aspects of its business.

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INDUSTRY NEWS “We have grown our operations, our reserves and became the first company to be listed on both the Nigeria and London Stock Exchange” Dr. Orjiako stated.

commitment to the highest standards of corporate governance standards as well as an unwavering focus on sustainable value creation for stakeholders.

future sustainable energy system in Africa. He also expressed optimism at the future prospects of Seplat despite prevailing challenges in the operating environment, adding that:

The Founding and outgoing SEPLAT CEO, Mr. Austin Avuru recalled the company’s journey from inception and how the company successfully surmounted the various challenges to become Nigeria’s leading independent. Avuru attributed the company’s success to its passionate

“We are very strong on corporate gove r n a n ce , s t r u c t u re a n d zerotolerance for unethical practices” Avuru affirmed. SEPLAT’s new CEO, Mr. Roger Brown described the summit as crucial platform to debate challenges and solutions for the transition to a

“We are still a company that is looking forward to very big strides and we are looking to the future to becoming an energy company delivering best practices globally as well as delivering value to our customers and all our stakeholders.”

Aveon Offshore Successfully Loads-out 300-tonne Topside Module for Anyala West Conductor Supported Platform By Margaret Nongo-Okojokwu

veon Offshore Limited has announced the successful loading-out of a 300-tonne topside production module for the Anyala West Conductor Supported Platform from its fabrication yard in Port Harcourt, Rivers State. The project, which is for the Nigerian National Petroleum Corporation and FIRST Exploration & Production Development Company Joint Venture (NNPC/ FIRST E&P JV), is the first of twoconductor supported platforms currently under construction by NNPC/FIRST E&P JV for Anyala and Madu fields in OML 83 AND 85.

“We are yet again proud of this milestone. The 300-tonne topside production module was successfully loaded-out for the Anyala West Conductor Supported Platform from our fabrication yard in Port Harcourt. “It has been transported to OML 83, offshore Nigeria, to be lifted onto the preinstalled drilling deck using a heavy lift vessel, after which the final hook-up and commissioning of the platform will be performed with first oil production commencing shortly thereafter. “This project is a NNPC/FIRST E&P Joint Venture. This is the first of two-conductor supported plat forms currently under

construction by NNPC/FIRST E&P JV for Anyala and Madu fields in OML 83 AND 85,” Aveon stated on its LinkedIn account. The company expressed gratitude to its clients for trusting it with the project and also appreciated its team and contractors for making the project a reality. Anyala Drilling Platform 1 (ANDP1) IS A Conductor Supported Platform, located in approximately 55m of water in OML 83, offshore Nigeria. The platform has been fabricated on Aveon yard over a period of about 18 months.

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INDUSTRY NEWS

Eni Takes Steps to Cut Operation Costs by 1.4bn Euros in 2020 By Jerome Onoja

talian energy giant, Eni, has taken step to cut its operation costs by 1.4 billion euros this year, because of the economic challenges occasioned by Covid-19 global pandemic. This was part of the consolidated results for the second quarter and first half of 2020 (not subject to audit), approved by the company’s Board of Directors on Wednesday. “Quarterly results were negatively and materially affected by the combined impact of the ongoing economic recession due to the COVID-19 effects on production, international commerce and travel, with a major impact on energy demand, and by oil and gas oversupplies,” a release by the company on Thursday said. The company reported an adjusted operating loss of €0.43 billion in the second quarter 2020 as against a profit of €2.28 billion in the second quarter of 2019 (adjusted operating profit of €0.87 billion in the first half 2020, down by 81 percent compared to 2019). The lower quarterly performance was driven by scenario effects of -€2.6 billion and the operational effects of COVID-19 for -€0.3 billion, partly offset by an improved underlying performance of €0.2 billion. In the first half of 2020, the underlying performance was positive for €0.3 billion. Adjusted net loss was put at €0.71 billion in the second quarter and €0.66 billion in the first half, driven by a lower operating profit and an increased Group tax rate that was negatively affected by the depressed scenario. According the release, the company recorded a

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net loss of €4.41 billion and €7.34 billion in the second quarter and the first half 2020, respectively, “due to the recognition of pre-tax impairment losses at non-current assets for €3.4 billion (of which €2.8 billion in the second quarter) mainly relating to oil&gas assets and refinery plants, due to a revised outlook for oil and natural gas prices and product margins, equaling to a post-tax amount of €3.6 billion that includes the write-off of deferred tax assets (of which €3.5 billion booked in the second quarter). Net result was also affected by a post-tax loss on stock of €1 billion due to the alignment of the book value of inventories to current market prices.” Adjusted net cash before changes in working capital at replacement cost was put at €3.26 billion in the first half of the year, down by 52 percent as against the first half of 2019 (€1.31 billion in the quarter, down by 61 percent) driven by negative scenario effects for -€3.5 billion, including the impact of dividends from equity accounted entities, operational impacts associated with the COVID-19 for -€0.6 billion, a non-cash change in fair valued derivatives for -€0.3 billion, while the underlying performance was a positive of €0.8 billion. It said that the net cash from operations was approximately €2.4 billion in the first half, down by 64 percent (€1.4 billion in the quarter, down by 69 percent), net investments was €2.86 billion, down by 24 percent due to the curtailment of the capex plan adopted since March 2020, fully funded by the adjusted cash flow, net borrowings was €19.97 billion (€14.33 billion when excluding lease liabilities), up by €2.85 billion from December 31,

2019, while leverage was 0.37, before the effect of IFRS 16, higher than the ratio at December 31, 2019 (0.24) and at March 31, 2020 (0.28). The IFRS 16 leverage was 0.51. Speaking on the results, Eni CEO, Claudio Descalzi said: “Eni’s second quarter results are extremely positive considering we have gone through what is likely to be one of the most challenging quarters the oil and gas industry has faced in its history. Prices collapsed along with demand due to both the pandemic crisis and geopolitical tensions. While actions taken by OPEC+ have allowed the market to reach some stability, emerging from the pandemic will be difficult, with signs of great uncertainty still to come. Given the current circumstances, Eni has promptly reacted by reviewing its 2020-2021 industrial plans with the aim of maintaining a robust balance sheet. In particular, we have taken action to reduce operating costs by €1.4 billion in 2020, without compromising employee job security. Capex has been cut by €2.6 billion, mainly in the upstream business, which has been most impacted by the crisis. Our gas, retail and bio-refining businesses have shown particular robustness, posting better results than those achieved in 2019 despite the effects of the pandemic and beating market expectations. These results have allowed us to once again generate cash flow exceeding capex, without affecting our €18 billion liquidity reserve at June 30, 2020.”

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INDUSTRY NEWS

DPR boss Charges Nigerian Lubricant Producers to Target Export Market By Margaret Nongo-Okojokwu

he Director, Department of Petroleum Resources (DPR), Sarki Auwalu, has charged lubricant producers in Nigeria to look beyond the shores of the country and target the export market in the distribution of their products. According to a statement signed by the DPR Head of Public Affairs, Paul Osu recently in Lagos, said Auwalu gave the charge when he played host to members of the Lubricant Producers Association of Nigeria (LUPAN) in a virtual meeting held recently.

The DPR boss noted that members of LUPAN had the capacity and resources to produce for exports, as was done in the past.He assured the members that DPR would provide adequate support through its robust regulatory framework to enable them to achieve the mandate.The DPR boss stated that the value created by LUPAN to the Nigerian economy was immeasurable. Auwalu stated that the DPR, as the regulator of the oil and gas industry in the country, it places high premium on its relationship with the association as partners in the realisation of government’s aspiration for the sector. He advised LUPAN to see DPR as a business enabler that is always ready to ensure investment success and sustainability for all stakeholders in the oil and gas sector.Sarki also emphasised the need for better strategic partnership a n d c o ntin u o u s c o lla b o r ati o n

between DPR and LUPAN.He reiterated that DPR was working with relevant government agencies to check the influx of sub-standard lubricants into the country and that solution would soon be provided for LUPAN members. The DPR boss informed the members that the department would soon begin the implementation of a digital solution, using the short code messaging system to check for adulterated lubricants in the country.In his remarks, the President of LUPAN, Alhaji Mustapha Adio, assured Auwalu that the association would continue to partner DPR for the development of the lubricant market in Nigeria. He also commended the positive interventions of DPR in the creation of enabling business environment for its members.

NNPC Inks $1.5bn Oil Prepayment Deal With Vitol, Matri By Daniel Terungwa

igerian National Petroleum Corporation (NNPC) has signed a $1.5 billion prepayment deal led by Standard Chartered and backed by oil traders Vitol Group and Matrix Energy, two sources close to the matter said, the first since the coronavirus pandemic. According to Reuters, the deal provides Nigeria with much-needed cash after its finances were hit by the oil price crash in April as COVID-19 lockdowns erased nearly one third of global oil demand. The financing package called Project Eagle was also backed by African Export Import Bank (Afrexim) and

United Bank for Africa. Vitol and Matrix will each get 15,000 barrels per day (bpd) of crude as repayment over five years, starting in August. Nigeria’s crude production is nearly 2 million bpd. Nigerian trader Matrix confirmed its participation in the deal. Vitol, the world’s biggest independent oil trader, declined to comment. A spokesman for Standard Chartered declined to comment. Afrexim did not have an immediate comment. UBA and NNPC did not immediately respond to requests for comment. Prepayments with traders are widely used in commodity finance as banks consider them to be one of the more secure forms of lending in countries

viewed as risky. For trading firms such as Vitol, these loans are ideal for securing long-term supplies and boosting razor-thin margins. NNPC has been trying to raise cash through prepayments with traders for years. However, the firm’s opaque finances and costly gasoline subsidies have made it tough for it to secure private financing on attractive terms. Nigeria announced the end of subsidies earlier this year. NNPC will use a large portion of the money to pay taxes owed by its subsidiary NPDC, the sources said. The remainder will go towards operational expenses and capital expenditure. One of the sources said money from the pre-payment could fund an upgrade of the Port Harcourt refinery.

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INDUSTRY NEWS

OPEC+ Plan to Increase Oil Production by August Could Backfire –Rystad By Ikenna Omeje between August and November is only a fraction of the 1.4 billionbarrel stock overhang that was built up in the first five months of 2020, adding that this historic inventory build-up will still act as a soft brake on price increases when demand rebounds.

he Plan by the Organisation of Petroleum Exporting Countries (OPEC) and its allies known as OPEC+ to increase production of oil from August could backfire as the upcoming partial return of curtailed oil production is set to create a new four-month supply glut of around 170 million barrels, a Rystad Energy analysis has revealed. According to the data consultancy firm, the analysis is based on the assumption that oil demand will not rebound as quickly as previously thought due to the persistent expansion of the Covid-19 pandemic in key markets, or what it called a mild second wave of the virus. It said: “After the first five months of 2020, which all registered excess global oil production compared to market demand, June was a month when global stocks saw some relief of 2.2 million barrels per day (bpd) of implied oil inventory draws. July, the last month of OPEC+’s record 9.7 million bpd output curtailment commitment, is also set to end with demand surprisingly exceeding supply by 1.9 million bpd.“But with the mild second wave already hitting several countries, we scale back our total liquids (crude, condensate, NGLs, other liquids, and refinery gains) demand recovery expectations in the short-term. Between August and October, total liquids demand levels will stay flat at around 90.5 million bpd, before rising to 92.9 million bpd in November and 94.6

“On the supply side, the US provided a much-needed supply-side buoy. We made major revisions to both our historical and future output projections. Based on preliminary reporting from most of the big oilproducing states and satellite data that give us insights into frac activity, we now believe that oil production (crude and condensate) reached a bottom of 10.4 million bpd in May 2020. “While oil production in the US will rise from now and until September, we have revised down our growth expectations due to low frac activity and natural decline.

million bpd in December.

“

Unlike demand, global oil supply is set for a mini growth rally after reaching an astonishing low of 86.4 million bpd in June and an expected 88.2 million bpd in July. The planned output increase from the OPEC+ alliance and the reactivation of other global shut-in production is forecast to push supply to 91.2 million bpd in August, 92.5 million bpd in September, 92.9 million bpd in October and 93.3 million bpd in November, before closing at 93.4 million bpd in December.” Speaking on the analysis, the Rystad Energy’s Head of Oil Market Research, Bjornar Tonhaugen, was quoted as saying: “OPEC’s experiment to increase production from August could backfire as we are still nowhere near out of the woods yet in terms of oil demand. The overall liquids market will flip back into a mini-supply glut and a swing into deficit will not happen again until December 2020.” “We doubt that the market can take the additional production volumes from OPEC+ from August without negative consequences for oil prices, as the new glut will likely cancel some of the gains that led Brent to post Covid-19 highs of about $44 this month,“ Tonhaugen said. The company noted that, nevertheless, the total surplus of about 170 million oil barrels that will be created

Production is estimated to bounce back toward the 11 million to 11.2 million bpd range and then degrade towards 10.7 million bpd again in 4Q20 and 1Q21 as the current activity level is insufficient to offset the natural base decline. “In addition, we revised down Iraqi oil production by about 200,000 bpd as the country makes good on its promise to make up for past missed OPEC+ compliance. Country-wide production will drop to 3.8 million bpd in Jul-20, we forecast, compared to our initial view that its output would struggle to get below the 4 million bpd barrier. We expect to see Iraq oil production capped below 4 million bpd through October but then will see output gradually increase again. “Our balances suggest that OPEC+’ tapering plans to year-end may need to be put on hold if the goal is to sustain the oil price recovery. This can of course still happen, perhaps already in a month, as OPEC’s market monitoring committee will be reassessing the market on a monthly basis,” Rystad stated.

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INDUSTRY NEWS

Shell Trumps Spill Response And Prevention Record In The Niger Delta By Ikenna Omeje

hell Petroleum Development Company (SPDC) has stated that it recorded a significant reduction of breaches from wellheads and cleaned up more spill sites than ever before. The energy company made this known in their 2020 Shell Nigeria Briefing, while pointing that in 2019, SPDC JV reduced operational spills to their lowest levels. It reported seven operational spills in 2019, representing a 46.6 percent decrease over the previous year (when it recorded 15 of such spills). Data available showed that in the year under review, theft and sabotage resulted in 156 spills. In 2018, the figure was 109. As part of the company’s policy, when a leak is identified, the team responds to contain any spilled oil and clean up. In 2019, it remediated 130 sites. Shell noted that SPDC JV is working to eliminate spills from its operational activities, remediate past spills and prevent spills caused by crude oil theft, sabotage of pipelines or illegal oil refining. While SPDC operates to the same technical standards as other Shell companies globally, the company said illegal activities continue to inhibit a normal operating environment; noting

that past spills from operational and illegal activities have been well documented, resulting in a clean-up programme and, where appropriate, compensation. According to the company, there is still much work to be done to get the company to its target of ‘Goal Zero’ in all spills (operational and third-party vandalism). This can only be archived through a solid strategy, active partnerships, closer community engagements, bold security and new surveillance equipment, the company said it is steadily making progress in the areas of Improving performance; Preventing illegal activity; Response and investigation; Improving remediation; and Clean-up in Ogoniland. In the area of improving performance, Shell has a global ambition to achieve no harm and no leaks across all its operations. This is known as Goal Zero. To reduce the number of operational spills in Nigeria, Shell said the SPDC JV is focused on implementing its ongoing work programme to appraise, maintain and replace key sections of pipelines and flow lines. In 2019, SPDC completed another 30 kilometres of new pipelines, bringing the total laid over the last eight years

to around 1,330 kilometres. “These efforts have significantly reduced operational spills over 100 kilograms to seven incidents and 28 tonnes of crude in 2019, compared to 15 incidents and 413 tonnes in 2018. This represents a year-on-year reduction of more than 90 percent by volume, returning the joint venture to its trend of reducing operational spills. “Community engagement and the ongoing commitment from government agencies has also helped shorten response times to incidents. SPDC’s average time to complete the clean-up of free and/or residual spilled oil has halved from 13 days in 2016 to seven days in 2019. Closer engagement with communities has helped SPDC to access spill locations more quickly, meaning on average that joint investigations now commence within three days in 2019 compared to six days in 2016,” it stated. Shell Nigeria however, indicated that there still remains a challenge of preventing spills relating to sabotage and theft by third parties. These illegal activities accounted for 95 percent of the SPDC JV spill incidents in 2019, a similar proportion to previous years.

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INDUSTRY NEWS “In 2019, there were 156 theft and sabotage-related spills over 100 kilograms, up from 109 in 2018. This is due to factors such as increased availability of production facilities after a major export line repair in 2017, crude theft activities in an election year when government security agents can be reassigned, and the price of crude oil and refined products that is seen as an opportunity for illegal refining. Despite preventive efforts, spilled volumes from illegal activities increased to around 2,000 tonnes of crude in 2019, compared with around 1,600 tonnes in 2018,” it said. On response and investigation, the company said upon identifying a leak, production is suspended, and efforts are made to contain any spilled oil. It said regular tests on emergency spill response procedures and capability is carried out in order to ensure staff and contractors can respond rapidly to an incident. Additionally, in line with government regulations, a Joint Investigation Visit (JIV) team visits the spill site to establish the cause and volume of oil spilled. In the area of improving remediation, the SPDC JV has continued to identify and remediate legacy spill locations. In 2019 alone, 130 sites were remediated and 123 certified by Nigerian government regulators, compared to 116 certified and 45 remediated in 2018. Also in 2019, SPDC and IUCN joined forces on the Niger Delta Biodiversity Technical Advisory Group, which includes representatives from the Nigerian Conservation Foundation and Wetlands International. The groups work together to monitor biodiversity recovery of remediated sites. Four sites have been assessed and selected as pilot sites for monitoring. These sites represent three ecosystems in the Niger Delta: land, seasonal swamp and swamp. On efforts made towards preventing illegal activities, Shell said the SPDC JV is committed to minimising the impact of third-party incidents and spills. The company works with government agencies, non-governmental organisations and communities to proactively minimise spills from illegal activity. This work includes: Using simplified zonal pipeline maps to enhance

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targeted response to third-party interference and prevent incidents from occurring. Since 2017, SPDC has also been able to remove more than 523 illegal theft points. Illegal theft points are identified by daily inspections from the air and on the ground. The company has also implemented anti-theft protection mechanisms, such as anti-tamper locks and steel cages for wellheads. Around 301 cages have been installed so far and around 80 more are planned for 2020 that will all come with CCTV technology. In 2019, three breaches of the cages were recorded out of 300 attempts. As a result, wellhead-related losses significantly dropped from about 30 kb/d in 2016 to less than 1 kb/d in 2019 across all SPDC operations. SPDC has also implemented several initiatives and partnerships to raise awareness of the negative impact of crude oil theft and illegal oil refining. Examples include community-based pipeline surveillance, radio jingles and the promotion of alternative livelihoods through Shell’s youth entrepreneurship programme, Shell LiveWIRE. On Ogoniland Clean Up, Shell said SPDC JV is working with the relevant stakeholders to implement the 2011 United Nations Environmental Programme (UNEP) Report on Ogoniland. Over the last eight years, the company has taken action on all, and completed most, of the UNEP recommendations addressed specifically to it as operator of the joint venture. The UNEP report recommended the creation of an Ogoni Trust Fund with $1 billion capital to be co-funded by the Nigerian government, the SPDC JV and other operators in the area. In its commitment to contributing its share of $900 million over five years to the fund, SPDC made $10 million available in 2017 to help set up the Hydrocarbon Pollution and Remediation Project (HYPREP), an agency established by the federal government to lead the cleanup effort. In 2018, the SPDC JV deposited a further $170 million into the escrow account to fund HYPREP’s activities, to complete its first-year contribution of $180 million. In 2019, the JV contributed the next tranche of $180 million, bringing the total contribution made to $360 million which represents the full amount due

for the two years. SPDC has continued to work with the Bodo community and others to clean up areas affected by two operational spills in 2008. A memorandum of understanding granting SPDC access to begin the clean-up was signed in 2015 and two contractors were selected to conduct the clean-up, overseen by an independent project director. The clean-up consists of three phases; removal of free phase surface oil, remediation of soil and planting of mangroves and monitoring. The removal of surface oil started in September 2017 and was completed in August 2018. Field remediation activities started in November 2019 following a contract procurement process to select remediation contractors. 800 community workers have been medically checked, assessed for their swimming ability to ensure they can safely respond to incidents in rivers and creeks, and trained to International Maritime Organisation oil spill response Levels one and two. Remediation is expected to take around 18 months. Shell said the clean-up will only be successful if the repeated re-contamination of cleaned-up sites from illegal thirdparty activity stops. In response to UNDP recommendations, SPDC has reassessed 15 SPDC JV sites mentioned in the UNEP report and remediated further where required with the sites certified by government regulators; completed an inventory and physical verification of assets for decommissioning and working with joint venture partners and the FGN to develop a decommissioning plan for these assets; completed a comprehensive review of its oil spill response and remediation techniques and made a number of improvements in line with industry best practices; collaborated with the Rivers State Government to deliver water to impacted communities and built water facilities, which are expected to be upgraded as part of HYPREP’s planned activities; and trained contractors on clean-up and remediation techniques and assigned specialist supervisors to a number of project sites to ensure effective oversight and compliance.

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INDUSTRY NEWS

NNPC Averts $125m Fraud Targeted at FG by Syndicate By Ikenna Omeje

he diligence of the Management of the Nigerian National Petroleum Corporation (NNPC) in collaboration with officials of the Federal Government has saved Nigeria from losing a whooping sum of $125,000,000: 00 (One Hundred and Twenty-Five Million United States Dollars) to an alleged international crime syndicate led by Messrs. Ramirez and Mr Jose Salazar Tinajero and their company Samano Sa De Cv. Reports said that SAMANO had contacted officials of the Federal Government sometime in 2015 with information in respect of 48 Million Barrels of Nigerian Bonny Light Crude Oil allegedly stolen from Nigeria and stored in various ports and terminals in the People’s Republic of China. SAMANO offered to purchase the alleged stolen crude upon its recovery. Even though its claim was difficult to believe given the stern procedures underpinning crude oil handling and export operations, the Federal Government of Nigeria in collaboration with the Nigerian National Petroleum Corporation (NNPC) set out to verify these claims and requested for evidence to that effect, which was never provided by SOMANO. Notwithstanding the failure to provide evidence to support its claims, relevant officials of the Government were mandated to proceed to China to verify the claims of the existence of the said stolen Nigerian Crude Oil. The said delegation discovered that the SAMANO’s claim was

false and baseless. Consequently, the Government severed communications with the syndicate. Miffed by this, Messrs. Ramirez and Mr Jose Salazar Tinajero, acting as agents of SAMANO, resorted to the blackmail and intimidation of key officials of the Government and the NNPC threatening to make public the fact that the said 48 million barrels of stolen Nigerian Crude Oil in China had been recovered, sold and the proceeds therefrom looted by some government officials and the NNPC when it was aware that this was untrue. They also demanded $125,000,000:00 (One Hundred and Twenty-Five Million Dollars) from said government officials, which was conveniently and rightfully ignored. Thereafter, NNPC reported this case of attempted blackmail to the Department of State Security and the Nigeria Police Force. They, upon investigation, discovered that SAMANO and its agents were international fraudsters. Mr Ramirez, for instance, was indicted by the U.S. District Court in the Southern District of Texas as the mastermind of a scheme leading to the loss of several millions of dollars through various mail and wire frauds between 2010 and 2013.In fact, there is a warrant for Mr Ramirez’s arrest and extradition to the United States to face criminal justice on account of the said fraud schemes. Mr. Jose Salazar Tinajero, a co-conspirator,

has been in and out of jail in South America due to the involvement of SAMANO in elaborate smuggling and money laundering scams. Mr Ramirez is also facing two separate and unconnected criminal charges at the High Court of the Federal Capital Territory, Abuja in Charge No: FCT/ HC/CR/147/2016 and the Federal High Court, Lagos in Charge No: ID/2763/2016. Both charges were preferred against Mr Ramirez by the Economic and Financial Crimes Commission (EFCC) for economic and financial crimes. The said Mr. Ramirez and his cohorts have since been charged to several courts in Nigeria for criminal offences ranging from fraud, forgery, extortion, blackmail, conspiracy, etc. The charge which relates to the attempt to fleece the Federal Government and NNPC is Charge No.: FCT/HC/BU/CR/134/2019 between the Federal Republic of Nigeria v. Marco Antonio Ramirez & 4 Others pending before the High Court of the Federal Capital Territory Abuja. But for the due diligence of the management of the NNPC, the Federal Government would have lost a whopping sum of $125,000,000:00 (One Hundred and Twenty-Five Million United States Dollars) to this international crime syndicate. The NNPC is currently consulting its lawyers Afe Babalola & Co. in a bid to take corresponding legal action(s) against the said syndicate for damages done to its reputation and its officials as a result of the false publications by the syndicate.

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Goodwill Messages to NCDMB on Inauguration of the Nigerian Content Tower.

Hearty congratulations to the Executive Secretary Engr Simbi Wabote and His ever productive/patrotic team

on the commissioning TODAY of magnificent 17-Storey NCDMB TOWER, the first of its kind in South-South Zone of Nigeria. We are excited to have proudly serviced the Edifice with Coleman ELECTRIC CABLES which is 100% made-in-Nigeria. Your leadership resilience in navigating challenges posed within Oil Sectors’ local content cannot be quantified. We are appreciative of your commitment! Congrats! George Onafowokan, MD/CEO, COLEMAN WIRES & CABLES

In 2014, NCDMB facilitated the first ever export of made-in-Nigeria cables. These cables were used for the production of six Liquified Natural Gas (LNG) ships for BGT/ NLNG in South Korea. Kabelmetal Nigeria was a proud beneficiary of this NCDMB’s progressive initiative. In 2019, NCDMB directed that all cables for use in the Oil & Gas industry in the country must be procured from Nigeria cable manufacturers. This is a huge boost to the nation’s economy, it scales up business opportunities for local manufacturers, enhances employment opportunities and tax revenue for the country. Robert Kretschmer, MD, Kabelmetal Nigeria Plc 14

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LOCAL CONTENT

President Buhari Inaugurates Nigerian Content Tower, Pledges More Spend on Job Creation, Infrastructure By Margaret Nongo-Okojokwu

...Jonathan, Senate President, ministers attend virtual commissioning

resident Muhammadu Buhari Thursday commissioned the new headquarters building of the Nigerian Content Development and Monitoring Board (NCDMB) in Yenagoa, Bayelsa State, with a pledge to spend more on infrastructure across the country and focus on finishing projects delivered by local contractors and technology that create jobs for thousands of Nigerians. The President commissioned the iconic 17-storey building known as the Nigerian Content Tower through the zoom meeting platform and was joined on the platform by former President Goodluck Jonathan, Senate President, Ahmed Lawan; Deputy Senate President, Ovie

Omo-Agege; three ministers, federal legislators, managing directors of international oil and gas companies and heads of government agencies. Other structures commissioned by Mr. President included the 10MW Power Plant and 1000-seater Conference Center and he reaffirmed his administration’s drive to provide infrastructure across the country to attract investments, create jobs and eradicate poverty. ‘‘With the commissioning of this project, I want to highlight that we have put in place a landmark of reference in the Niger Delta to reflect long lasting legacies that signpost the years of oil and gas exploitation and I assure you that there is more to come,’’ he said.

He expressed delight that thousands of direct and indirect jobs were created during the execution of the project in addition to the various business opportunities. ‘‘This commissioning brings to the fore the importance of local content in all activities of our national life especially with the prevailing COVID-19 pandemic. ‘‘I believe strongly in local production and patronage of our goods and services as one of the surest ways to empower our citizens and give them viable opportunities to excel in their chosen professions and business endeavors. ‘‘That is why two of the Executive Orders issued under our government are related to enforcing local content in public procurement and contracts

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LOCAL CONTENT to further replicate the successes being realized in the oil and gas industry. ‘‘Local Content and Self Reliance are key principles of the recently approved 2.3 trillion Naira National Economic Sustainability Plan. The plan is aimed at the promotion of local production, local services, local innovation, and the use of local materials,’’ he said. Commending the Ministry of Petroleum Resources, the Minister of State for Petroleum Resources, Chief Timipre Sylva, members of the Governing Council, as well as management and staff of the NCDMB, for the achievement, the President said: ”The edifice we are commissioning today is a befitting birthday gift as you mark your 10thyear anniversary as a regulator and developer of local content in the oil and gas industry. ‘‘I am also pleased that this project has been delivered by local contractors supported by other local engineering and project consultants. We must all be proud that we finished what we started. In his address, Chief Timipre Sylva described the building as evidence that Mr. President was committed to infrastructural development in every part of the country. ”It shows that skyscrapers and other laudable infrastructures can be built in the Niger Delta and indigenous contractors can perform wonders

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when given the right opportunities and the people of Bayelsa and indeed the entire Niger Delta are receptive to development and that Nigerian Content is here to stay.” In his remarks, the Executive Secretary of NCDMB, Engr. Simbi Kesiye Wabote confirmed that the project was “fully executed using the dexterity of a Nigerian Architect, Popham Walter Odusote and other Nigerian consultants to design and supervise the project execution. The main contractor, MEGASTAR is Nigerian with several other Nigerian sub-contractors that worked day and night to deliver this world-class building with impressive safety statistics.” According to him “the materials used is 76 percent Nigerian Content with the tiles, electrical cables, granite, and many other building materials produced in Nigeria. The manpower used for services and labor is over 95 percent Nigerian Content. The skills transferred to the local workforce in the construction of a high-rise building has been unprecedented.” He expressed pride in the end-toend thinking that went into the design and execution of this project which is typical of the Nigerian Content Board. “That is why we also partnered with NAOC JV to provide the 10MW gas-fired Power Plant to provide reliable power supply to the new headquarters building,” he said.

Attendees of the event in Yenagoa included the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mr. Mele Kolo Kyari, who conveyed the support of the corporation to the NCDMB in the delivery of Local Content value to the nation. In his speech, the Managing Director of Megastar Technical and Construction Company Limited, Architect Harcourt Adukeh stated that it was remarkable that a project awarded during the administration of former President Jonathan had continued seamlessly to completion and commissioning under the Buhari’s administration. He commended NCDMB for having clarity of intent regarding what it wanted to achieve with the project. ”This clarity of intent and enthusiasm to develop Nigerian capacity engaged on this project was demonstrated seamlessly through corporate administration of four consecutive Executive Secretaries.” He emphasised that the excellent technical back ground and experience of the current Executive Secretary helped ease the project, stressing that the project recorded a remarkable safety record, with zero Loss Time Injury (LTI), zero fatality, zero disability and zero road transport accident.

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LOCAL CONTENT

North/East Intervention: NCDMB Receives Report from Aisha Buhari Foundation By Margaret Nongo-Okojokwu

h e N i g e r ia n C o n te n t Development and Monitoring Board (NCDMB) recently received the implementation repor t on the school-based deworming programme it sponsored in Adamawa, Borno and Yobe States through the Aisha Buhari Foundation (ABF). The National Coordinator of the Foundation, Dr. Mohammed Kamal Abdurrahman submitted the report to the General Manager, Research, Strategy and Development (RSD), NCDMB, Mr.Abdulmalik Halilu at a brief ceremony at the Board’s liaison office in Abuja. The target of the Board’s support to ABF was to eradicate schistosomiasis, a neglected tropical disease amongst children between the ages of 5-11 years and to improve the nutritional status of pregnant women. The Executive Secretar y of NCDMB, Engr Simbi Kesiye Wabote participated in the meeting via the virtual platform and he remarked that the Board supported the programme because of the direct linkage between healthcare and nutrition of children and their mental development and contributions to the economy in their adulthood. He remarked that the Board’s intervention led to the donation of Folic Acid and Iron Supplements to 12,500 Pregnant Women and mass

administration of Praziquantel Drug among school children for treatment of Schistosomiasis in Adamawa, Borno and Yobe States. A total of 243,776 children were administered the drug, with Adamawa having 100,778, Borno, 120,146 and Yobe 22,852. Wabote added that the programme also trained health workers in the three states, for sustainability and trained teachers in administration of the drug to school children for sustainability. Other accomplishments included the donation of 55,000 packs each of Ribena, toothpaste and toothbrushes to improve oral hygiene among pupils, development of a collaboration model and establishment of working relationship between the Board, the foundation, Federal Ministry of Health, World Health Organization (WHO) and State Ministries of Health on accessing logistics, training, communication and administration of drugs to combat Schistosomiasis on an ongoing basis. The National Coordinator of the Aisha Buhari Foundation thanked the Board for supporting the successful implementation of the programme He highlighted the multidimensional nature of the project, including the impact on children’s educational performance as well as the health

benefits to school children, pregnant women and unborn babies. Abdurrahman also hinted that “the project has the potential to contribute to the attainment of many of the Sustainable Development Goals, particularly Goal 2, which speaks to the issue of nutrition; Goal 3, which has to do with promoting health and well being of all; Goal 4, which has to do with education and Sustainable Development Goal 17 which speaks to the issue of partnership. ”In addition, this project aligns with national and global priorities as well.” Making a presentation, the Programme Manager, Dr Omole Ukwedeh revealed that the Board partnered ABF in 2018 with a view to supporting government’s efforts towards improving child survival in the North East. She clarified that Borno, Adamawa and Yobe were selected because they were the most affected by insurgency. She also explained that parasitic worms, Schistosomiasis and Soil Transmitted Helminthiasis are types of Neglected Tropical Diseases (NTDs) that are endemic in Nigeria, especially in the North East. According to her, these parasites have a detrimental impact on child health as they deplete nutrients in children and adversely affect physical and cognitive development, causing symptoms such as abdominal pain, anaemia, bladder and liver diseases. ”This results in impaired growth, reduced school attendance, poor educational achievement and reduced productivity as adults,” Ukwedeh added. Recalling their experiences while executing the programme, Ukwedeh said they were impacted by insurgency in Yobe State, reluctance of the populace to accept drugs in Borno state and communal clashes and difficulty to access some areas in Adamawa state. She pleaded with NCDMB to continue its support for the programme, adding that it was important to carry out follow up treatment for two consecutive years to achieve elimination of Schistosomiasis in target communities.

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LOCAL CONTENT

Oilserv, IVM Create Pedestal For Proliferation Of Locally Manufactured Vehicles By Jerome Onoja

L-R: Engr Emeka Okwuosa (Chairman, Oilserv Group) and Chief Dr. Innoson Chukwuma (Chairman, IVM) on tour of IVM facility

n furtherance of local content develop m ent , Nigeria’s engineering, procurement and construction (EPC) giant has announced its partnership with Innoson Vehicle Manufacturing as it intends to get involved in the conceptualization, manufacturing and use of the locallymanufactured vehicles for its oil and gas operations. This is geared toward eventual proliferation of Nigerianmade vehicles.

The growth of Nigerian Content development in the oil industry is backed by the Nigeria Oil and Gas Industry Content Development Act (NOGICD Act) of 2010, a piece of legislation that was reinforced by the presidential Executive Order 003 and later Executive Order 005. All three instruments of the law point to the nation’s push for patronage of indigenous companies and growth of local capacity and capabilities.

Sequel to its order for vehicles worth 600mn Naira (US $1.58mn), Engineer Emeka Okwuosa, Chairman of Oilserv Group recently led a team of some of his C-level executives on a tour of the IVM plant in Anambra state, where both companies announced their partnership in a bid to further entrench local content and increase the supply of locally-manufactured vehicles to Oilserv’s fleet and the Nigerian oil industry.

Oilserv, a 100 per cent Nigerian-owned, EPC company with a commendable track record on big ticket projects within and outside the country has shown unwavering commitment in leading the development and expansion of Nigerian Content. Its strategic partnership with IVM is expected to spike the patronage and use of madein-Nigeria vehicles in the nation’s oil industry and beyond.

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Speaking to newsmen at the tour, Okwuosa said, “As an engineering and construction firm, we build pipelines in Nigeria and across Africa; we also develop and use technologies. But overtime, we have seen IVM prove itself because it doesn’t just talk the talk but also walks the walk, so we are here to identify with him. “It’s important to note that IVM manufactures motor vehicles, they do not just assemble component parts. They take it from the scratch and adapt it to our country.

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So, we see their ingenuity as an avenue to forge a partnership. As such, we are here to see their processes and to tell the world that IVM is developing Nigerian Content, of which Oilserv is a key driver.”

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LOCAL CONTENT

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He further added, “IVM is a local manufacturer while Oilserv is a local engineering company. So this partnership with IVM is a testimony to the development of local capacity in Nigeria.

We only import some engines, electrical and body parts but we produce all the plastic component ourselves, he added.”

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He further stated that, “new vehicles are produced according to demand. Whatever the need, we can build the mould and produce the specification.

We are here to partner with IVM for the conceptualization, manufacturing and use of local vehicles for our activities in the oil and gas industry.” Confirming IVM’s competency over time, Okwuosa said, “We have been engaging Innoson before now because we believe in them. We already made an order worth about 600mn Naira. Some of the vehicles you saw during the tour are being made for Oilserv. “It’s pertinent to note that you need to have high quality and standards to service the oil industry. I’m talking about international standards; the same that obtains in Western world. And that standard is what we see here.

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Another key feature with IVM is the flexibility of its manufacturing process. That gives you a wide range of options to explore.” On his part, Dr Innocent Chukwuma, Chairman and Chief Executive Officer of IVM maintained his resolve to develop Nigerian Content and local supplies of its raw materials. He stated that IVM is unfazed in spite of the absence of a functional steel industry. “Because we manufacture and do not just assemble, 60 per cent of our component parts come from within the country. Yes, it’s interesting to note that we make the carcasses of the vehicles here, locally.

“The partnership with Oilserv will help Nigeria as a whole, even across Africa. Because, wherever OIlserv works across Africa, it’ll be noted that the vehicles used are from Nigeria.

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Our vehicles constitute about 90 per cent of their fleet – locally manufactured! That tells you Mr Okwuosa has the development of Nigeria in mind.” Alluding to a unique benefit from its partnership with Oilserv, Dr Chukwuma stated that, “even when they give us orders on certain specs, we still learn a thing or two from them because Oilserv is an outstanding engineering company with international footprint. Confirming the standards with its manufacturing process, he affirmed that IVM’s manufacturing process is built to global standard. He said, “our vehicle manufacturing system is consistent with what obtains globally. There are international standards you have to meet, otherwise it won’t work. We maintain that same standard here.

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We don’t just manufacture to quality and standards, our delivery is also on scheduled time. I can attest to that fact that Oilserv is happy with our delivery time” he quipped.

sourcing vehicles locally, the Group Head of its Supply Chain at Oilserv, Chukwuma Nkwodinmah praised the partnership between both firms. Nkwodinmah said, “Sourcing vehicles locally has added to Oilserv’s profitability. A direct comparison between the prices of local supplies as against importation of similar vehicle specs shows a price differential. That difference is a huge profit to OIlserv.

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Also, our large orders help Innoson put food on the table of its large employees. So, it’s a mutually-beneficial partnership with a lot of prospects”, he added. In the same vein, Solomon Okodugha, Group Chief Finance Officer, Oilserv Group noted that the partnership is strategic to Oilserv, helping it further its pursuit of Nigerian Content development. Okodugha averred that the partnership will lift jobless people off the street via employment by both companies, thus it’s a commendable venture which also improves the economic wellbeing of Nigerians. Identifying a unique feature of the partnership, Chigozie Obi, General Manager Operations and Technical Services for OIlserv stated that,

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Both companies are champions of Nigerian Content and they are making a huge statement by showing Nigerians and the rest of the world that they can carry out technical activities and still maintain international standard”.

Lending his voice to a major benefit of local content development and

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LOCAL CONTENT

Azikel Modular Refinery In Bayelsa Progresses By Margaret Nongo-Okojokwu

he Azikel refinery is a modular hydro-skimming petroleum refinery being developed in Yenagoa in Bayelsa state of Nigeria. It is the first private hydro-skimming refinery being developed in the country. The refinery is being developed by Azikel Petroleum, a subsidiary of Azikel Group, which operates various businesses in Nigeria including dredging, air transportation, power, and petroleum. The new refinery will have a total production capacity of 12,000barrels per day (bpd). It will process Bonny Sweet light crude and Gbarain condensate to produce high quality petroleum products including a few secondary products. Azikel refinery location and site details The refinery is located in the Obunagha complex of the Gbarain region, near the city of Yenagoa in Bayelsa State. It is in close proximity to the shores of the Nun River towards the south, the GbarainUbie Shell gas gathering facility on the east, and the proposed Azikel power plant on the west. The refinery site covers an area of 19.9ha and is well-connected to road transport infrastructure by the East-West Road and the Issac Adako

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Boro Expressway that connects to Yenagoa and Port Harcourt.

per minute (gpm) and cooling water circulation will be 1,200gpm.

Â Azikel refinery design details

Azikel refinery development and construction details

The Azikel refinery development is divided into two segments â&#x20AC;&#x201C; Outside Battery Limits (OSBL) and Inside Battery Limit (ISBL). The ISBL segment will include process units of different sizes, which are designed to produce mixed liquefied petroleum gas (LPG), gasoline, kerosene/Jet A1, diesel and heavy fuel oil products. It will comprise of a crude distillation unit with debutaniser, naphtha hydrotreater, naphtha splitter, catalytic reformer, diesel treater, isomerisation units, steam boilers and gasoline stabiliser. The OSBL segment includes an internal road network of 3.1km and total storage capacity of 665,700 barrels or 70,930m3 for crude and refined products with 32 units of different tank sizes. The area will also house a security building, maintenance building, administrative building, terminal operator building, vapour collection centre, fire-fighting station, loading gantry, water treatment and utilities. The refinery will receive feedstock from the nearby Gbarain-Ubie Shell facility through a pipeline to the storage tanks. The raw water consumption of the refinery will be 140 gallons

The major engineering designs for the Azikel refinery were implemented in 2015 and the soft development of the project began during the same year. Infrastructural development works began in 2016 after receiving environmental and social impact assessment certificate followed by land acquisition and land preparation. The refinery site comprises of naturally thick virgin swamp forest, which required massive sand filling to enable construction. The land reclamation and sand filling works for the site required the use of 2.7 million cubic meters of sand over a period of nine months. The detailed engineering works commenced in 2017 followed by the civil and mechanical works. Concrete perimeter fencing and construction of the internal road network commenced during the same year. Major works undertaken in 2018 included the construction of the storage tanks, administrative building, terminal operating building, and helipad apart from installation works for the main refinery.

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LOCAL CONTENT Procurement and fabrication of the main modules including the crude distillation units, isomerisation units, and naphtha hydrotreater is currently ongoing. Azikel refinery products The primary products of the refinery will include premium motor spirit, diesel, kerosene, LPG and aviation fuel. The secondary products from

the refinery will comprise of heavy fuel oil, naphtha, and gas oil. Contractors involved McDermott, an engineering and construction company, was awarded the engineering, procurement, and construction (EPC) contract for the ISBL segment of the refinery in July 2020. McDermott also worked on an extended front-end engineering and

design (FEED) contract since 2018. UAE’s MUC Oil and Gas undertook the project management consulting and FEED contract for the project. Other companies associated with the project include Honeywell UOP, Oil Project USA, JLS Capital Strategies, Shell, MRS, Norton Rose Fulbright, Atlantic Gulf and Pacific Company, and Chemie-Tech.

NCDMB in Equity Investments Agreements With Nigerian Based Firms By Margaret Nongo-Okojokwu

igerian Content Development and Monitoring Board (NCDMB) has signed equity investment agreements with Duport Midstream Company. The agreement will see the establishment of an energy park in Egbokor, in the country’s midwest and Eraskon Nigeria Limited, for lubricating oil blending plant in Gbarain, in Nigeria’s south-central east. The two companies are expected to

generate 1500 direct and under the board’s commercial indirect jobs. ventures programme and are in sync with the vision to The energy park will comprise catalyse the industrialisation of 2500 bpd modular refinery, of the Nigerian oil and gas 30mn standard cubic feet industry and its linkage gas processing facility, a sectors. He noted that the compressed natural gas board was excited at the facility and two megawatts prospects of the partnerships power plant. The lubricating in job creation, value oil plant is expected to have retention petroleum products a capacity for 45,000 litres availability, utilisation of our per day. abundant gas resources and in the development of inSimbi Wabote, engineer and country capability. the executive secretary, said the investments were coming

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LOCAL CONTENT

FG Begins Feasibility Study for Brass Shipyard Project NCDMB, NLNG to drive project By Margaret Nongo-Okojokwu by the NCDMB in conjunction with NLNG as a Capacity Development Initiative (CDI) on the back of the Train 7 Project. He mentioned that Nigeria has a long coastline of 853 kilometers and navigable inland waterways of 3,000 kilometers, which offer immense potential for maritime sector development, stressing that Brass coastline, was very close to the Atlantic Ocean. Wabote further explained that there ”are over 20,000 ships working for the oil and gas sector in Nigerian waters and the annual spend was over $600million in the upstream sector.”

he Federal Government has commenced feasibility study for the construction of a shipyard in Brass Island, Bayelsa State, which would cater for the maintenance and repair services of cargo vessels, oil tankers, and LNG carriers. The Minister of State for Petrolem Resources, Chief Timipre chaired the project’s kick-off meeting on Thursday and stated that it will be executed by China Harbour Engineering Company, which had carried out similar projects across the globe as well as in Nigeria. The feasibility study will be funded by the Nigerian Content Development and Monitoring Board (NCDMB) as part of its overarching mandate to domicile key oil and gas industry infrastructure and increase retention of industry spend. The scope of the feasibility study includes geotechnical and bathymetric surveys, conducting a market study, ascertaining an optimal construction scale, developing technical proposal and construction plan and estimation of the required investment to bring the project into reality. According to the Minister, the high traffic of vessels in and out of Nigeria provides a huge opportunity to retain substantial value in-country through the provision of dry-dock services.

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He said the shipyard project would further develop and harness the nation’s position in the oil and gas value chain and linkage to other sectors of the economy. Dwelling on the prospects of the shipyard project, Sylva hinted that the Nigeria LNG’s Train 7 project is expected to increase the company’s Liquefied Natural Gas capacity from 22MTPA to 30MTPA and induce the acquisition of additional LNG carriers to the existing ones, all of which would need maintainance and servicing. He added that the project would also benefit from the upcoming implementation of the Africa Continental Free Trade Agreement (AfCFTA) as Nigeria could serve as hub for ship-building and repairs. He expressed confidence that the outcomes of the feasibility study and subsequent construction and operation of the shipyard will create employment opportunities and contribute to poverty reduction in line with the aspirations of President Muhammadu Buhari’s Government. In his presentation, the Executive Secretary of NCDMB, Engr. Simbi Kesiye Wabote assured the Brass shipyard project and other ongoing efforts to catalyze manufacturing would help the Board achieve the target of 70 percent Nigerian Content by 2027. He confirmed that the project was being driven

Providing more statistics, the Executive Secretary stated that the oil sector spent $3.047bn on marine vessels between year 2014-2018 and 73 percent of the total spend went to crew boats, security vessels, diving support vessels and fast supply intervention vessels. Other vessels in that category include mooring launch and shallow draft vessels, he said. He regretted that most of the vessels that operate in the oil industry are taken to Ghana, Equatorial Guinea, Cameroun and other countries for dry docking because our local dry docks were built many years ago and no longer provide the required services. The Executive Secretary also listed the objectives of NCDMB’s Marine Vessel Strategy to include promotion of indigenous ownership, increase participation and increase capacity of local shipyards to build, service & maintain marine vessels of various sizes and manufacturing of vessel components and consumables incountry Other objectives of the Marine Strategy are to give first consideration to Nigerian built or owned vessels for contract award and job offers, discourage capital flight, generate employment and increase retention of Industry spends and stimulate value creation. The project’s schedule indicates that the site work would be executed within six months while feasibility study would be completed in four months.

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SOCIAL INVESTMENT

COVID 19: Oilserv Donates Medical Supplies To Enugu State Government By Chioma Orji

Engr Emeka Okwuosa, Chairman Oilserv Group and Ifeanyi Ugwuanyi Governor of Enugu

igerian engineering, procurement and construction (EPC) g ia nt , O ils e r v o n Friday August 7, donated medical supplies and Personal Protective Equipment (PPE) to Enugu State Government and people, in furtherance of the Group corporate social responsibility initiatives and support in the fight against Covid-19 pandemic in the state. This gesture is sequel to the Oilserv Group donations and support to host communities in Abia and Rivers States, in the fight against the pandemic and to provide palliative to the teeming

populace, to help cushion its effect. The donated items, which were received by the Governor, His Excellency, Gov. Ifeanyi Ugwuanyi at the Enugu state Government house, were presented by Oilserv Boss; Engr. Emeka Okwuosa. The items donated include: Disposable Face Mask 3-PLY Flu Virus Dust Protection (20,000pcs); FFP2 FDA Approved Mask (400 nos); Nitrile Protective & Disposable PVC hand glove (10,0 0 0 nos.); Transparent Medical Face Shield (200 nos); Disposable Non-woven Protective suit made with breathable film (200 nos); Neutral Infrared Thermometer (50 nos); and

Facial and Temperature Monitor Facial and Temperature Monitor / Camera with Accessories and Brackets (1 nos). Others were: COVID-19 Rapid Test Kit (200 nos); Alcohol based hand sanitizer (70ml) – 500 nos; Alcohol based hand sanitizer (125ml) – 360 nos; Alcohol based hand sanitizer (500ml) – 120 nos; Alcohol based hand sanitizer (5 Litres) – 60 nos; and Antiseptic liquid handwash (600ml) – 180 nos Oilserv commended the governor on his indefatigable effort and determination to keep Enugu State safe at this time of COVID-19 pandemic.

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ACROSS AFRICA

More than a glimmer of hope for Jobs, Poverty Eradication By JEROME ONOJA AND AMOS IKE

resident Muhammadu Buhari had promised to lift 100 million Nigerians out of poverty within a ten-year period, and he planned to do this majorly through job creation. However, the COVID-19 pandemic has posed a major challenge to the attainment of this target, as businesses are struggling to survive under the impact of the pandemic. This article explores the role the oil and gas sector is playing in making this target achievable, highlighting oil projects and the correlating employments in the country. It also points out the role of the Petroleum Industry Bill (PIB) in ensuring continuity of the planned positive impact on the economy.

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Unemployment, one of the root causes of poverty and crime, has over the years, been a major challenge and burden to Nigeria. The National Bureau of Statistics’ (NBS), had in its third quarter 2018 report, pegged unemployment in Nigeria at 23.1 per cent; underemployment at 20.21 per cent; youth unemployment and underemployment at a worrying 55.4 per cent. That means for every 100 Nigerian youth in the working-age range, approximately 56 persons are either unemployed or underemployed. These statistics has further been worsened since COVID-19 struck, as more and more businesses have been affected by the lockdown. The decline in

economic activities has made some businesses go bankrupt. This is also threatening the promise of President Muhammadu Buhari to lift 100 million Nigerians out of poverty, mainly through job creation, making its attainment seem impossible. Nigeria’s unemployment rate had been projected to rise to 33.5 per cent by 2020, while it has been estimated that the

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global pandemic could push at least five million people into poverty; spike Nigeria’s inflation rate to almost 14 per cent, as well as put the country at the cusp of an impending recession.

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COVER STORY

Situating the problem, the analysts said: “The Nigerian government’s ability to create employment for its growing youthful population has been gravely undermined by the plunge in oil revenue due to the crash in global oil prices.

Vice President Yemi Osinbajo

Osinbajo stated that the government anticipates 39.4 million job losses by December due to the pandemic. Before the COVID-19 pandemic, Nigeria’s unemployment rate was already high at 23.1 per cent, while underemployment stood at 16 per cent, according to the NBS. In May 2019, Chris Ngige, the Minister of Labour and Employment, also projected an unemployment rate of 33.5 per cent by 2020.

“This has necessitated several revisions to the country’s 2020 budget and significant reductions in certain planned fiscal expenditure. Although the oil price benchmark was reviewed upwards to $28 per barrel from $25 per barrel, according to the recently passed revised budget, the fiscal revenue projection is based on expected oil production of 1.8 million barrels per day (mbpd). “This is above the new OPEC quota of 1.4mbpd. Invariably, it could be as unrealistic as the newly revised 2020 budget of N10.81 trillion, which is 2.08 per cent higher than the initial budget of N10.59 trillion. In other words,

In its June 2020 report, analysts at Financial Derivatives Company (FDC) stated that the imposition of lockdown measures has had a severe impact on business operations and raised the threat of massive job cuts as companies struggle to survive the nightmare of the century. For instance, the analysts noted that Vice President Yemi Osinbajo had argued that the combination of the

“

coronavirus pandemicdependent factors – including lockdown measures and depressed global crude prices – had led to a sharp rise in unemployment rates in Nigeria and completely derailed the economy’s already fragile recovery from its 2016 recession.

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the United States reported a spike in its unemployment rate to 14.7 per cent in April 2020, the highest since the inception of the unemployment survey,

before it eased to 13.3 per cent in May 2020. They explained that although the unemployment statistics of many African economies including Nigeria is not up to date, these countries are also likely to experience a surge in unemployment rates.

Chris Ngige

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with government revenue in tatters, the feasibility of planned fiscal spending is already a mirage and so is employment creation. “This is aggravated by the possibility of massive lay-offs of workers by firms operating in the country, especially companies offering non-essential services who have been the most affected by the lockdown measures. A number of companies have reported

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COVER STORY a steep decline in earnings in first quarter 2020, largely attributed to the unintended consequences of the COVID -19 lockdown measures.” However, World Bank Lead Economist for Nigeria, Marco Hernandez, argued that

Marco Hernandez

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the unprecedented crisis requires an equally unprecedented policy response from the entire Nigerian public sector, in collaboration with the private sector, to save lives, protect livelihoods, and lay the foundations for a strong economic recovery.

Specifically, during the lockdown, investors in the Nigeria Liquefied Natural Gas (NLNG) had taken the Final Investment Decision for the Train 7 project; the Nigerian Content Development and Monitoring Board (NCDMB) had entered into agreements with firms for the development of an oil and gas park, a modular refinery and lubricating plant projects in Edo and Bayelsa; construction of a shipyard in Brass Island and a research institute and a museum in Oloibiri. The NNPC is moving beyond its unprecedented audit to the revamp of the country’s refineries and proceeding with its plan to construct condensates refineries; Dangote Group is inching closer to completion of its 650,000 barrels per day refinery project, while oil majors have promised to continue with their ongoing projects. Almost all of these projects, among others, are labour intensive and are envisaged to create massive job opportunities for Nigeria as well as make meaningful impact in the economy of the country. For instance, the NLNG Train 7 project has been estimated to create over 40,000 direct and indirect jobs at its peak, this is in addition to several thousands of jobs it would create from associated industry that would spring up from the expected increase in gas production and utilisation. Executive Secretary of the NCDMB, Engr. Simbi Wabote, had stated that the

And this is the leadership role stakeholders in the Nigerian petroleum industry have displayed. Despite the lull in economic activities, the Nigerian oil and gas industry is forging on and providing the muchneeded succour and cushion needed to sustain the economy in these trying times. Since the pandemic broke out and the attendant lockdown, most businesses in some sectors of the economy had cut down on their operations, but the oil and gas sector, the country’s major source of revenue and foreign exchange earnings, has continued to forge on, with a number of projects continuing unhindered, while new ones came on stream. 26

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NLNG Train-7 project would deliver 100 per cent engineering of all non-cryogenic areas incountry, adding that the total in-country engineering manhours is set at 55 per cent which exceeds the minimum level stipulated in the NOGICD Act,

in line with resolve to push beyond the boundary of limitations. The schedule of the NOGICD Act set the minimum engineering man-hours for FEED and Detailed Engineering on LNG Facility at 50 per cent. He stated further that

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the benefits of the Train 7 project would extend to site civil works on roads, piling, and jetties, 100 per cent local procurement of all LV and HV cables, non-cryogenic valves, protective paints and coatings, sacrificial anodes and many other direct procurements from local manufacturing plants.

The target, according to Wabote, is to assemble over 70 per cent of all non-cryogenic pumps and control valves in-country, while other spinoff opportunities include logistics, equipment leasing, insurance, hotels, office supplies, aviation, haulage and many more. He added that

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Engr. Simbi Wabote

the project would open up other development opportunities for some gas fields in the shallow and deep offshore acreages such as HI, HA, HK, and Opoukunou-Tuomo fields.

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COVER STORY Wabote had charged the SCD consortium to fully implement the agreed Nigerian Content levels as contained in the approved Nigerian Content Plan for Train-7 project, covering engineering, fabrication, civil works, local procurement, project services, logistics, equipment leasing, insurance, hotels, office supplies, aviation, haulage, human capacity development and jobs. Apart from the job opportunities and the accruable revenues from this multi-billion dollars Train-7 project, the Minister of State for Petroleum, Chief Timipre Sylva, also sees the additional tonnage of LPG to be produced from Train-7 as a key benefit to reduce importation of LPG into the country. Another massive job creating project is

was recently put at 71 per cent completion, is currently envisaged to be completed by 2021. While upon completion, the

that operations at its new $2 billion granulated urea fertiliser plant at Ibeju-Lekki would begin soon, adding that

Dangote refinery

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Dangote Refinery, which is situated on 6,180 acres (2,500 hectares) of land at the Lekki Free Zone in Lagos is expected to be Africa’s biggest oil refinery and the world’s biggest singletrain petroleum facility.

Chief Timipre Sylva

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the Dangote Refinery, which had been estimated to create a total of 4,000 direct and 145,000 indirect jobs during different phases of the project. Estimated to cost about $18 billion, the refinery will produce Euro-V quality gasoline and diesel, as well as jet fuel and polypropylene. The refinery will be able to process 650,000 barrels of crude oil per day into refined petroleum products, which would help Nigeria become an oil refining country, not just an oil exporter. The Dangote Refinery, which

International and local contractors like MAN Diesel & Turbo, Schneider Electric, C&I Leasing, Honeywell UOP, and Air Liquide Engineering & Construction have benefitted from the building of the refinery and these companies have employed Nigerians to work on the project. In addition, Governor of the Central Bank of Nigeria, Godwin Emefiele, disclosed that the Dangote Refinery would lead to the employment of over 70,000 Nigerians when it finally starts operation. According to Emefiele, the Dangote Refinery and Petrochemical plant, when operational, would increase its workforce from the current 34,000 to over 70,000. Another job creating project is the Dangote Fertiliser plant, which had been envisaged to create thousands of jobs in addition to its opportunities for the Nigerian economy. President of the Dangote Group, Alhaji Aliko Dangote, stated

Godwin Emefiele

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the fertiliser plant would make Nigeria the only urea exporting country in sub-Saharan Africa and biggest producer of polyethene, which is capable of generating $2.5 billion annually. He said, “Nigeria would soon become the biggest and only urea exporter in sub-Saharan Africa, for the first time. And we are not only exporting, but we would also be exporting big time. “We are also going to have polyethene which is about 1.3 million tonnes annually. These two products would bring in about $2.5 billion annually in terms of foreign

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COVER STORY exchange. A lot of forex would now come in and that $2.5 billion is only about 10 per cent of remittances.” “Pre-testing of the fertiliser plant, all the sections of the fertiliser plant, such as Central Control Room, Ammonia and Urea Bulk Storage, Cooling Tower, Power Generator Plant and Granulation Plant, have all been completed and are going through pre-testing.” He said the project would be the largest fertiliser plant in the world with its three million tonnes per annum capacity which would make Nigeria the largest exporter of petroleum products in Africa.

During the revamp of the refineries, Nigerians would be engaged by the firms contracted by the NNPC to carry out the revamp, while the revival of the refineries would further create more jobs as more Nigerians would be engaged to work at the refineries. The NNPC said it was also in the process of establishing two new 200,000 barrels-per-day condensate refineries to boost incountry refining capacity.

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Unlike the conventional refineries, condensate refineries primarily refine condensate, not crude oil. They often produce one product, mostly Premium Motor Spirit, popularly known as petrol.

Already, Oilserv Limited, one of the nation’s leading EPC partners in the project had said it would employ and absorb about 3,000 workers to complete the project. Engr. Emeka Okwuosa. Chairman/ Group Chief Executive Officer of Oilserv, said these workers, including engineers, would be engaged to complete a 303 kilometers part of the project in record time of 12 months and commissioned within 18 months. Oilserv said it is going to complete its own portion of the project, which runs from Ajaokuta to some kilometers after Abuja, faster than the 24-month period expected by the Federal government for the completion of the project.

Nigerians would be engaged during the construction of the refineries, and more Nigerians would also be employed when the refineries come on stream.

Alhaji Aliko Dangote

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Yet another project that would boost employment in Nigeria, is the revamp of the country’s existing refineries, and the Nigerian National Petroleum Corporation’s quest to build two new 200,000-barrels per day refineries. The NNPC had recently secured financing from two oil trading companies and some banks to pay off taxes owed by its subsidiary, Nigerian Petroleum Development Company (NPDC), and also utilise some of the funds to finance the revamp the refineries.

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Furthermore, the Ajaokuta-KadunaKano (AKK) pipeline, which was flagged off during the COVID-19 lockdown, is another project that would impact Nigeria’s employment rating positively. According to the Federal Government, the economic benefits of the AKK pipeline which would originate from Ajaokuta, in Kogi State and traverse Abuja, Niger, Kaduna, and terminate at Kano, would boost domestic utilisation of natural gas for Nigeria’s socioeconomic development, when completed

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It is envisaged to unlock 2.2 billion cubic feet of gas to the domestic market, support the addition of 3,600 megawatts of power to the national grid and revitalise textile industries, which alone boasts of over three million jobs

Engr. Emeka Okwuosa

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The 303 kilometer portion of the project would also involve running an in-built tracking sensor gas pipe of 40-inch diameter to ensure protection,

safet y and maintenance on completion of the project. According to the company, all the engineering works on the project would be done by certified Nigerian engineers, as this is part of efforts to promote local content in the oil and gas sector.

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COVER STORY Okwuosa said, “We are ready for it. We are already working at laying the lines.

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Although we are 100 per cent an indigenous company, with the AKK project, we intend to engage between 1,500 and 2000 personnel at the peak of operations. “We will crank up our employment by more than 1,000 and the major part of this 1,000 will be indigenes of the areas where we operate. We have a clear plan to develop the areas where we build pipelines.” Also, the NCDMB recently signed two agreements with two firms in a deal worth $25 million combined, for the construction of a lube blending plant in Bayelsa State, and an energy park in Edo state, comprising among others, the setting up of a modular refinery and power plant. Simbi Wabote stated that

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from these two projects, the partners are expecting about 1,500 direct, indirect, and induced employment opportunities, adding that there are several other spin-off economic activities that would be developed where these projects are located,

which are also capable of creating enormous job opportunities. The two separate partnership agreements and share subscription agreements were signed, firstly, between NCDMB and Duport Midstream Company Limited for the construction of an energy park at Egbokor, Edo State and between

NCDMB and Eraskon Nigeria Limited, for construction of a lube blending plant at Gbarain, in Bayelsa State. The deal saw NCDMB acquire equity stakes in the companies with the intent of ensuring that the aims and objectives of the projects come to fruition. NCDMB is investing $15 million in Duport and $10 million in Eraskon. Wabote explained that the partnership with Duport Midstream Company Limited entails the construction of an energy park at Egbokor, Edo State comprising 2,500 barrels per day (BPD) modular refinery, 30 million standard cubic feet per day (MMscfd) gas processing facility which would include a Compressed Natural Gas facility and two megawatts (MW) power plant. Regarding the partnership with Eraskon, Wabote said the project would be the first and only lubricating oils blending plant in Bayelsa State, adding that the 45,000 litres per day facility would enhance the availability of engine oils, transmission fluids, grease, and other products. Chief Executive Officer of Duport Midstream Mr Akintoye Akindele, assured that the energy park project would add value to the nation’s natural resources and create wealth and social amenities for communities. He added that

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the Energy Park is scheduled to create over 1,000 jobs and impact 10,000 families,

noting that the modular refinery would produce a combination of Naphtha, diesel, kerosene and HFO, otherwise known as residual fuel oil. Wabote, also disclosed

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the Board was in talks with a number of Original Equipment Manufacturers (OEM), to domesticate a large percentage of modular refineries fabrication and assembly in Nigeria, another venture that would create jobs in large numbers. Also,

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the various gas initiatives of the Federal Government, is expected to create 500,000 jobs across the country,

in addition to its target of boosting gas supply and consumption. Specifically, Programme Manager – National LPG Expansion Plan in the Office of the Vice President, Mr. Dayo Adesina said, the government, with the various gas projects, had projected gas consumption volumes and value to be unlocked in different sectors of the Nigerian economy. “In the textile industry, for instance, there is a potential to have about 500,000 metric tonnes deployed in that area.

Mr Akintoye Akindele

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COVER STORY and consulting, well drilling services and petroleum technology as well as maintenance and modification among others. Simbi Wabote had explained that Project 100 was conceived to identify 100 start-up oil and gas companies and support them through special interventions to facilitate their incubation, maturation and growth into world class service companies.

Mr. Dayo Adesina

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When we revamp this gas industry, we can create about 450,000 direct jobs.

opportunity for LPG in the industry for cooling, heating and power generation,” he maintained. There is also the Project 100 initiative, promoted by the NCDMB, where indigenous oil and gas service

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companies involved in the project have contributed over N50 billion to Nigeria’s Gross Domestic Product (GDP), and created over 1,500 direct and 15,000 indirect jobs

that benefit the nation. The areas of competencies of the Project 100 beneficiaries include exploration, subsur face and seismic services, fabrication and construction, Front End Energy Design, FEED, detailed and other engineering services, marine services and operations and inspection, testing and certification. Other key areas of competencies are inspection, hook-up and commissioning, material and procurement, project management

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He said the programme was introduced as part of the NCDMB’s mandate to develop the capacity of the local supply chain for effective and efficient service delivery in the oil and gas industry. There is also the LPG cylinder plant being planned in some states across the country that is expected to create about 1,000 jobs; like the proposed plant in Polaku, which the NCDMB said would create between 250 and 350 jobs during the construction phase and other LPG cylinder projects in the south-west region of the country. Other ongoing and soon-to-commence oil and gas projects that would improve the country’s employment statistics over the next coming years include the Brass Island shipyard project; Bonga South-West Aparo; Brass Liquefied Natural Gas (LNG); Olokonla LNG project; Gas Revolution Industrial Park, Ogidigben; Zabazaba-Etan and Preowei projects among others. However, for these projects to go on as envisaged, experts are unanimous in their views that the much-needed reforms in the petroleum industry should be instituted urgently, especially with the passage of the Petroleum Industry Bill (PIB). Specifically, immediate past President of the Petroleum Technology Association of Nigeria (PETAN), Engr. Bank-Anthony Okoroafor, argued that

Engr. Bank-Anthony Okoroafor

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Nigeria would continue to be faced with severe cases of capital flight and paucity of new investments in its oil and gas sector if it continues to delay in passing the Petroleum Industry Bill (PIB) and if it also fails to undertake farreaching reforms of the sector. Okoroafor, who is also Managing Director of CB Geophysical Solutions Limited, disclosed that the delay in the passage of the PIB was holding down lots of final Investment Decisions (FID) and critical investments in the Nigerian oil sector. According to him, the uncertainty created by the lack of passage of the reforms have significantly affected investments in the Nigerian oil and gas sector, adding that it is important for the country to send a signal to the market that the government is serious about the oil reform agenda. “Time is of the essence now to pass this PIB. There is no better time than now, especially as oil is being found everywhere around the globe,” he argued. Okoroafor maintained that Nigeria’s production was declining by between 10 per cent and 15 per cent annually, adding that

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COVER STORY

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for the country to maintain two million barrels per day, it needs to be spending about $10 billion capital expenditure (CAPEX) annually.

He added that to grow to its target daily production of three million barrels per day, Nigeria needs to be spending between $20 billion to $30 billion dollars capex yearly, especially as this would guaranty activity level to achieve and maintain the desired level of daily production. He said: “Government should assent to and speedily sign the PIB, which comprises the Petroleum Industry Fiscal Bill (PIFB), Petroleum Industry Administration Bill (PIAB), Petroleum Host and Impacted Communities Development Bill (PHICDB). “Timely conclusion of the ongoing industry reforms would guarantee legislative certainty and clarity. The government should work with the National Assembly and critical stakeholders to actualize this. “Delay in passing the PIB is holding down lots of FIDs and critical investment. The passage of and the assent by Mr. President to the PIB is important to send a signal to the market that this government is serious about the oil reform agenda.

Also speaking, Senior Partner, Energy and Commercial Contracts of Primera Africa Legal, Mr. Israel Aye, lamented that the country had lost billions as a result of the delay in the passage of the PIB, adding that the opportunity cost of the delay in terms of industry growth, infrastructure and value addition to the economy was too high, for the country to continue to toy with the passage of the bill.

On her part, President of the Women in Energy Network (WIEN), Mrs. Funmi Ogbue, maintained that the delay in the passage of the PIB was creating uncertainties in the Nigerian oil and gas industry.

According to him, until Nigeria reviews its strategies and policies relating to the petroleum industry, focusing more on increased domestic consumption of its oil and gas resources and development of the midstream sector of the industry, the industry would continue to make limited contributions to Nigeria’s economic growth, while its impact would always be limited.

She said, “The expedient passage and purposeful implementation of the PIB is critical to addressing most of the loopholes in the management and governance of the sector.

He said:

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“We believe that this time around, the Ninth National Assembly will break the jinx and should be able to pass the Petroleum Industry Bill. Struggling to pass a legislative bill for 20 years is a shame to us all.”

“The uncertainty created by the lack of passage of the reforms has significantly affected investments in the Nigerian oil and gas sector.

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I call on the legislators to expedite action on the passage of the relevant bills associated with Section 16 of the Petroleum Act and incorporate feedback from the public hearing.

She said that the current legal framework in the sector was ineffective, especially with the many regulator y overlaps in responsibilities.

Mr. Israel Aye

Mrs. Funmi Ogbue

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“The PIB when passed into law will improve governance of the sector by strengthening institutions in the areas of clarity of structures, roles, accountability, transparency, and overall efficiency and effectiveness.” In addition, Energy Research Fellow at the Surrey Energy Economics Centre, University of Surrey, Dr. Carole Nakhle, however, commended the Federal Government, stating that the country was on the right path in terms of moving with the long awaited reforms of its petroleum fiscal regime.

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COVER STORY Nakhle, who is also Chief Executive Officer of Crystol Energy and acts as Special Parliamentary Adviser on Energy and Middle Eastern Issues in the House of Lords, stated that the delays in the passage of the PIB over the years, and related intense debates and controversies had heightened the fiscal and political risks. She added that the delay in the review of the Nigerian petroleum industry laws had negatively affected investors’ confidence in government policies. Nakhle disclosed that

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with volatile oil and gas prices.

Nigeria’s fiscal regime, at the moment, was unnecessarily complex and a tapestry of different structures and rates, with special focus on royalty, which, in turn, varies with terrains, water depths, oil price and oil and gas production. She listed the guiding principles of an attractive fiscal regime to include stability, simplicity, progressivity and neutrality, adding that a starting point in reviewing Nigeria’s fiscal regime would be to aim for simplification. She argued that Nigeria’s fiscal regime was unstable and lacked progressivity, noting that the frequency of the fiscal changes proposed and/or implemented strongly suggested a structural weakness in the fiscal regime that prohibits it from adapting to evolving oil industry related conditions, both domestically and internationally.

Dr. Carole Nakhle,

“With the heavy focus on royalty and its relatively high rates, well above what is typically found elsewhere and in addition to instruments such as signature and production bonus, the regime is overall regressive. Sliding scale royalty does not secure progressivity. “Location, volume and prices: poor proxy of profitability; linking taxes to oil price will create further instability.

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The only way royalty can be made progressive is by linking it to a profitability measure,” From the foregoing, it is obvious that the Nigerian petroleum industry will continue to make meaningful contribution to the development of its economy through job creation and provision of opportunities for linkage sectors. Still, it is a critical factor in the country’s quest to diversify its economy and guarantee lasting poverty eradication.

She stated that a progressive regime can stand the test of time and cope

Mozambique, Total Plan to Export Gas by 2024 15, 2020. Tanzania’s LNG project — in the natural gasrich offshore Ruvuma Basin — in the southeastern part of the country — still awaits the final investment decision (FID) after the government grants project approval.

ozambique plans to start exporting liquefied natural gas (LNG) by 2024 ahead of Tanzania, after Total SA secured a $14.9 billion debt facility for the construction of an LNG processing plant in Cabo Delgado Province, in the deep waters of Ruvuma Basin north of the country. The debt financing agreement, which is the country’s first onshore development, was signed on July

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Mozambique’s FID for the $20 billion LNG project was made in June 2019 and building works started in August the same year. Total SA’s chief financial officer Jean-Pierre Sbraire said Mozambique’s senior debt facility — the biggest in Africa to date — includes funds from eight Export Credit Agencies (ECAs), 19 commercial banks and a $400 million senior loan from the African Development Bank Group (AfDB). “This is a first in class transaction that sets a new standard for mega-

ACROSS AFRICA projects on the African continent,” said AfDB’s acting General Counsel Souley Amadou on the collaboration of project sponsors, Mozambique’s government, the financing parties and advisors. Total SA is leading a consortium of firms in the project that will have a gas plant and an export terminal on the Afungi peninsula. Total acquired a 26.5 per cent stake in the Mozambique LNG project from Occidental Petroleum for $3.9 billion in September 2019 .“The project will facilitate the development of gasfired electricity and will play a key role in providing reliable affordable energy for the country and the wider region,” said Wale Shonibare, AfDB’s director for Energy Financial Solutions, Policy and Regulation.

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ACROSS AFRICA

Equatorial Guinea Focused Trident Energy Bets on Pre-salt Layer with Brazil Acquisition

LUKOIL Acquires Cairn Energy’s Senegal Interests By Daniel Terungwa

UKOIL has concluded an agreement with Cairn Energy to acquire a 40% interest in RSSD (Rufisque, Sangomar and Sangomar Deep) project in the Republic of Senegal for $300 mln in cash. The agreement also provides for a potential bonus payment to Cairn Energy of up to $100 mln after the commencement of production. The transaction is subject to customary conditions, including the approval by the government of the Republic of Senegal. The blocks of the project covering 2,212 sq km are located on the deepwater shelf of the Republic of Senegal 80 km from the shore with the sea depth of 800-2,175 meters. The blocks include two discovered fields: Sangomar and FAN. The Final Investment Decision (FID) on the Sangomar field was taken in the beginning of 2020 and the field development has begun. According to the Company’s estimates, the recoverable hydrocarbon reserves of the Sangomar field total approx. 500 million boe. The field is planned to be launched in 2023 with designed production level of 5 million tons of crude oil per year. The RSSD project is being implemented under a production sharing agreement. Woodside is the project’s operator with 35% stake. Other participants are FAR (15%) and state-owned company Petrosen (10%). ‘Entering the project with already explored reserves at early stage of their development is fully in line with our strategy and allows us reinforcing our presence in West Africa. Joining the project with qualified international partners will allow us to gain additional experience in development of offshore fields in the region’, said Vagit Alekperov, President of PJSC LUKOIL.

rident Energ y, the independent company operating the Ceiba and Okume fields in Equatorial Guinea since 2017, has just made its official entry into Brazil’s offshore. The company has acquired the Pampo & Enchova clusters from staterun Petrobras, which include ten concessions producing over 22,000 bopd from the PPM-I, PCE-1, P-8 and P-65 platforms. With this acquisition, Trident Energy confirms continued appetite from independent oil & gas operators to grow their assets globally, especially in proven geological regions around the pre-salt layer which extends from Africa to Brazil. Such offshore regions, which include the hydrocarbons-rich provinces found in Angola, Equatorial Guinea or São Tomé and Príncipe, have proven to be very identical and a hotspot for global exploration. According to recent industry estimates, the pre-salt Campos & Santos basins in Brazil may contain as much as 100 billion barrels of recoverable oil.

discovery in Guyana belongs to the same geological system. “Trident Energy’s ability to get the deal done during difficult moments speaks to its leadership’s and longterm view of the energy industry. This acquisition b y Tr i d e n t E n e r g y continues to demonstrate the attractiveness of the geological system offshore Brazil and Africa. Such interest by independents is very encouraging both for new markets such as Suriname and Guyana in the Americas, but also for exploration in new African provinces such as São Tomé and Príncipe,” declared Nj Ayuk, Executive Chairman at the African Energy Chamber. The acquisition marks a major milestone in Trident Energy’s strategy to acquire large midlife assets globally. In 2017, the operator was successful in taking over the Ceiba and Okume fields in Equatorial Guinea.

ExxonMobil’s world-class

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OVH Energy Concludes First Phase Of Covid-19 Intervention In Nigeria By Esther Mordi

VH Energ y Marketing, has wrapped up the first phase of its support for the Federal Government’s efforts at combating COVID-19 in Nigeria. The company’s intervention includes various donations such as N50 million towards NNPC’s collective intervention funds made through Major Oil Marketers Association of Nigeria (MOMAN), supply of test kits and the sum of N200 million as part of its Corporate Social Responsibility (CSR) efforts for the treatment of COVID-19 patients, donation of palliatives to host communities in Apapa, Onne, Ogu and Kaduna to help cushion the negative effects of COVID-19. As part of the contribution, OVH Energy has heightened safety and hygiene standards in all its facilities to ensure protection for clients, neighbors, customers and staff on essential duty who have carried on operations. The organization has also distributed protective masks and OVH Energy produced hand sanitizers – ‘OVH

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Energy Hand Sanitizer’ to all OVH Energy Marketing staff at its operations facilities and retail outlets nationwide initiating its DIY (Do it Yourself) protocols. Speaking on this initiative, the Chief Executive Officer, Huub Stokman said, “We each have our role to play in ensuring the safe health and well-being of everyone during these unprecedented times. Our donations underscore our support for nation-wide relief efforts and we appreciate the Government’s interventions so far and are proud to collaborate to ensure that critical stakeholders such as front line staff are protected during this crisis, and to enable more tests to be carried out in order to help save lives and ultimately defeat the pandemic.” He also added that, “the spread of the Coronavirus in Nigeria meant that we immediately triggered our BCP (Business Continuity Plan) and initiated efforts to minimize the spread as much as we could. In times like this, personal hygiene measures cannot be overemphasized. We

have shared with our employees measures which they should take in order to protect themselves and families. We have also urged them to follow directives provided by health authorities. We will continue to monitor latest developments on the situation to take appropriate measures”. OVH Energy’s donations have also been used to improve hospital facilities and establish isolation centers in Abuja and Yola. The company has scheduled the distribution of 3000 test kits across the country in states that have been hit the hardest by COVID-19. The company’s provision of palliatives in form of food items and other materials has fed and supported over 320 families in communities where it operates, including Onne and Ogu – Rivers State, Apapa Marine Beach & Orisunmibare – Lagos State, Ekpan –Warri and Tasu Mahuta- Kaduna respectively.

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SOCIAL INVESTMENT

Ogoni Clean-up: HYPREP Flags Off Livelihoods Training Programme

he Hydrocarbon Pollution Remediation Projec t (HYPREP) recently, flagged off the livelihoods training programme for Ogoni people, as part of the recommendation of UNEP to restore the livelihoods of communities impacted by oil pollution. Flagging off the programme in Korokoro, Tai LGA of Rivers State, the Minister of Environment, Dr. Mohammad Abubakar, said President Buhari is committed to fulfil every promise made to Ogoni people in the implementation of every recommendations of UNEP in Ogoniland. The Minister also commissioned a cassava processing factory built by its partners, the Stakeholders Democracy Network, SDN for the training of Ogoni youths on garri processing in commercial quantity, for economic growth. Abubakar also disclosed that the factory after a three-month supervisory running of the factory by the International Institute for Tropical Agriculture, IITA and SDN, would be handed over for running by the pioneer graduates which HYPREP had trained at the IITA in 2019. “This factory is the sustainability package for the training which we promised that on our own part, we have given you assurance and we want to restate it here that we are

committed to a post-training setup that will enable you put into use the skills you have acquired for your benefit and of your dependents. “Moving forward, HYPREP has developed a plan to group the operators of the factory being the Ogoni youths into co-operatives to enable them access funds to set up their own businesses, engage and train more youths. “The multiplier effect of this facility on the local economy cannot be overemphasised as households and individuals farmers can come here to process their produce, while there will be increase in the availability of food and business activities. “This factory will also serve as a hub for trainees from the Ogoni women livelihood training programme handled by the United Nations Institute for Training and Research, UNITAR.” The Minister, represented at the event by the Project Coordinator of HYPREP, Dr. Marvin Dekil, tasked the beneficiaries to jointly protect and make good use of the facility, adding that the factory was one among several other facilities where its livelihood training would take place. “Part of the livelihood programme is the training of 1,200 Ogoni women in different agro-allied skills in the areas of feed formation, poultry, fish farming and cropping for six months.

“HYPREP has engaged UNITAR to handle this training of women and that tells you the quality of training that the women will be receiving at the end of the day. “This event does not only mark a significant milestone in our continuous effort to provide alternative source of livelihood for people in impacted communities of Ogoniland but a further indication of President Buhari’s resolve to implement the UNEP report and better the lot of Ogoni people and Niger Delta at large.” Also speaking, the Chairman, Supreme Council of Ogoni Traditional Rulers, HRM King Godwin Giniwa, threw his weight in support of HYPREP for the implementation of UNEP Report in Ogoniland. “I am happy that HYPREP is progressing, whatsoever you will need to make the project successful, we will be here to make it available. You have our support, go ahead, we are behind you. “There will be peace for you in Ogoniland. I am grateful for what you are commissioning today. I pray the Almighty God to bless you (Dekil), your office and the Federal Ministry of Environment.” Also speaking, the Head, IITA, Onne, Dr. Richardson Okechukwu, disclosed that the factory has the capacity to produce five tons of garri per day, as well as plantain, yam and coconut flour.

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ENERGY WOMAN

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...Research shows this USS 40 barrel of crude, after refining, is worth close to USS2,500” Oladunni Owo President, WEOG

ladunni Owo is the author of the award-winning book: “BlackGold Refinery Business Made Easy-The Ultimate Guide To Making Big Money in Oil and Gas Refining’’. She is the president of Women in Energy, Oil and Gas (WEOG) Nigeria, a founding member of the Diversity Sectorial Working Group of the Nigerian Content Consultative Forum (NCCF), and belongs to a host of international women networks. Owo is an experienced business executive, management consultant and an oil and gas expert with over 2 decades of professional experience and expertise spanning the entire energy value chain working at several management roles across the downstream, midstream and 36

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upstream sectors of the industry. She is currently the CEO and Principal consultant at BlackGold Authorities and Advisory Consult, an organisation focused on providing management consultancy, capacity building and advisory services for the oil and Gas Industry. Being a Woman in STEM, she graduated with a Bachelor of Technology in Pure and Applied Mathematics, a MBA in Operational Research (OR) and a DBA in view. Excerpts of her interview with Jerome Onoja: You authored a book on refineries in Nigeria. What informed it? Yes, I did, but it is not specifically

for Nigeria, it is actually for all oil producing nations of the world. The title of the book is “BlackGold Refinery Business Made Easy-The Ultimate Guide to Making Big Money in Oil and Gas Refining’’. The book was written to solve the problem of refining, close the knowledge gap in refining, encourage producing nations to refine their oil, make the best of the God-given resource and stop treating it as a typical buy and sell commodity. I wrote the book so that the knowledge can be dispersed everywhere and people can learn and take action. I joined the oil and gas industry in the year 1995, as an undergraduate intern. It was those days when Nigerian University system was so

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ENERGY WOMAN unstable with lots of ASUU strike. I was opportuned to work with National Oil and Chemical Marketing Company, now rebranded as Conoil after the Shell and NNPC equity divestment. There were lots of issues in the oil and gas downstream industry. Frequent scarcity rocked the country, with a lot of queues at gas stations lasting close to 72 hours and sometimes five days, or more! There were cases where EHSQ were compromised, leading to fire incidents in the gas stations, burnt cars and humans. For me, these were major national problem. On the flip side, I understood according to OPEC, that Nigeria is the fifth largest oil and gas producing nation in the world. In my mind, I just could not reconcile the two situations. That got me really interested in the industry. I did not do that job like a typical intern. For me, it was a mission to see how this problem can be resolved and how we can actually have a proper match; that was the beginning of the journey. I worked in National Oil’s regional office with the sales and distribution team and station dealers. Later, I worked in the IT department at the head office, Lagos. Afterward, I moved to Unipetrol which later got rebranded as Oando plc, after the AGIP and NNPC equity divestment. I worked in HR, Operations, Sales, Marketing, Strategy and Planning, Logistics , Projects, and Corporate Services . While serving in those capacities, I still had the mind of being a part of the solution to the industry problem. That mission drove my passion in the industry. How can we make this oil and gas a wealthgenerating resource for the nation and not just a typical commodity that people buy and sell?

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What gave me that opportunity was my being a member of the team that implemented a major ERP system for the organization as a subject matter expert and I had an overview of the business model for the entire organization and all its subsidiaries spanning the upstream, midstream, gas and power, services, downstream marketing and distribution designing business process models. I realized that the distinct challenge in downstream is still the same in the upstream and midstream. That was when I discovered that the major problem was that in Nigeria,

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the oil and gas resource is being treated as a typical buy and sell commodity as against it being a major resource. It is meant to be a transformational resource with the capacity and capability to transform resources like educational resource; human resource; infrastructure, and others.

There is meant to be significant transformation in the nation by virtue of Nigeria hosting this God given extractive the oil and gas but unfortunately that is not so rather we explore and produce the crude oil then sell it out to other nations. In the days where crude oil was US$150 or US$120 per barrel it seemed ok to just explore the oil, sell it out and not go through the stress of refining, which turns it into real wealth. It is only when you refine the crude that you have the real wealth. Recently I did an exposition on the real value of a barrel of crude. There was a research done about 5 years ago on the true financial value of a barrel of oil post refining. It was discovered that this crude that is currently sold at about US$40 per barrel can actually be worth close to $2,500 per barrel when refined. The people buying it from us are not just going to use it as crude oil but will refine it and turn it into useful products and materials that can create wealth. The reason why Dubai has become what it is today is because they treated and traded their oil as a transformational resource and used it to enhance their tourism industry. In 2012, I took a break off active employment to really do some research and studies. I discovered that the story hadn’t changed much. We were still selling out the crude at

While at Oando Plc, I touched virtually every part of the Industry, majorly downstream, some bit of midstream and some bit of upstream, it was a really engaging period.

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ENERGY WOMAN a $40, $60, $70 and importing the PMS, AGO, DPK, plastic, fertilizer, bitumen, asphalt, LPG and virtually everything else. It just did not add up. In the course of my study, I consulted for an organisation on a refinery project called First Atlantic Independent Refinery, one of the eighteen firms licensed to build private refinery during President Obasanjo’s tenure. Consulting for the organization was like a learning curve for all of us, because we had to see how we could make refining work in Nigeria; how we could raise funds for the projects. That led to a lot of exposure in refining and other untapped parts of the industry such as petrochemicals, gas flare commercialisation etc. I decided to reveal all my discoveries, I did not want to be selfish and leave it all to myself. I wanted people to be aware. There is a saying that goes: “There is power in knowledge; knowledge is power’’. When people know better they will do better, so I decided to capture all my refining knowledge and research work and put it into a book, such that people can read , study it and see that refining is not so much of a big deal. I remember during those research periods, I interviewed some top oil and gas executives in Nigeria from across downstream, midstream and upstream exploration and production, I asked them why they were not playing in the refining space. While some didn’t understand the process at all, others highlighted that it was not as profitable as it sounded. Then I asked why would America be buying crude oil from Nigeria if it is not a profitable business? They are not drinking it, they refine and turn it to hundreds of useful products that are then sold back to us at huge price. That is the real wealth. Yet, our industry executives are of the opinion that “There is no money in refining, the money comes in trickles and it is capital intensive”. I agree it is capital intensive so 38

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I added this to the challenge and began looking for refining solutions. I included project funding to the portfolio and here we are today. It’s so exciting to see that it’s now happening in Nigeria and some other African nation. What has the reception of the book been like? Very well. I actually launched it in 2016, in the United States of America. Then, my book architect and mentor, Dr Raymond Aaron helped to give it a good outlook and it became an award winning book in America. I got an award for writing the book because it was a solution-driven book, to solve a major multinational problem. The reception has been pretty good in Nigeria and in other African countries.

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It is selling on Amazon categorised under Amazon prime. Amazon took it up before I even made prints available for local consumption or distribution. I really wanted people to pick my brain and learn from the book, the first 1000 copies were given out free at conferences and the industry events since 2016. Aside the good reception, the impact has been fantastic. One of the major advocacies I have been projecting before and after writing the book are

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the refining quick wins and quick fixes producing nations can leverage on, such as modular refining solution: a quick fix to closing refining gaps. In 2017, my team and I were invited by the former minister of petroleum resources to discuss the possible refining quick fixes. In-country

capacity building and modular refining solution were our major discussion highlight. I appreciate the fact that they embraced that solution and now we are beginning to see increased modular refinery investments both private-sector driven and PPP driven. For me, that is a major feat to be celebrated. It is heart-warming to see it happening “live” in Nigeria.

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Now we have a total of about 16,000 barrel per day Modular Refining capacity with others coming on stream soon.

I remain a strong advocate for domesticating our oil and gas supply chain; that is where the real wealth is. What is your assessment of Nigeria’s overall crude oil refining of late, what would you recommend to be improved upon? Yes, there have been improved activities because of the advocacy and campaigns for in-country refining. The truth of the matter is until Nigeria really sees refining as a solution and starts treating crude oil as a transformational resource we will just be singing the same song we have been singing. It is great to see Dangote group make that massive refining investment, a totally green field business for the group. One would have expected that it was going to be one of the big players in the industry that would take up the business responsibility. That refinery is going to be a major one in Africa; the second or third largest in the world, the largest refinery in the world has a 900,000 barrels per day, capacity although it is growing old now. Dangote refinery is a 650,000 barrel per day capacity with complimentary petrochemical, fertilizer, power plants and so on. It is 70% completed. It is a massive plant.

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ENERGY WOMAN

The modular refinery solution is actually a solution to help provide refined product to local communities. A typical example is a case study of Texas, where you have several modular refinery units across the states. A refinery can serve just one local community based on their products need. It could be configured to produce just AGO and DPK; you could have others just churning out Naphtha to be used as raw material for petrochemical activities like plastic production and so on. Of course, we have the Waltersmith modular refinery in Imo State that is currently a five thousand barrel per day refinery. We have the Niger Delta Exploration and Production (NDEP) refinery upgraded from a 1000 b/d to 6000 b/d and later to 11000 barrels per day in the nearest future. The OPAC modular refinery is also 5,000 b/d. There are quite a number of refining investments decision ongoing, about 25 others may come on stream within the decade. I am quite appreciative that Nigeria is beginning to see the need to refine in-country

There was a particular time crude oil price crashed below $20 per barrel, at that point only nations with integrated energy chain enjoyed the dividends of that crash. We are yet to hear the last on the state of NNPC refineries. What solution would you recommend?

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In total, we are supposed to have about 445,000 barrels per day total capacity of the four refineries, but they are currently working below 15 percent and of course, it is another embarrassing paradox. Government cannot run those refineries. That model is not working. My proposal is that Government should divest her equity hold on the plants and allow investors who understand refining business run them.

Currently, I know the refineries are being refurbished to commence production and the government have plans to hire consultants or outsource them to organizations that can run the operation. As good as this may sound, I think a better decision will be to just divest it entirely to the private sector For instance, Kaduna refinery was built to churn out products like bitumen but in almost five years the refinery has not produced any significant volume of bitumen. 100 per cent of the bitumen on Nigerian roads are imported. I recommend that the government divests the brown field refining assets 100 per cent. Let private sector take it up. Some of the national refineries OSBL (Outside Battery Limit) are still in good condition even though the ISBL (Inside Battery Limit) is almost packed up. There are several things that can be done with those facilities: they can be run as a brownfield project,

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ENERGY WOMAN collocate the refinery with other smaller modular refineries, smaller petrochemical plants and other smaller power plants thereby maximising the OSBL assets. What is the vision behind WEOG? Women in Energy Oil and Gas (WEOG), is an incorporated trustee, duly registered with the Corporate Affairs Commission of Nigeria in 2019 as a non-governmental organization (NGO). We are currently operating under the banner of international forum for women in energy, oil and gas. We created the forum to promote gender diversity and inclusion in the energy sector, being a male-dominated industry. It is meant to create opportunities for women to step into leadership roles and pursue their careers, businesses and personal goals in the industry, in line with the sustainable development goals. At WEOG, we believe that a more inclusive workforce will not only enhance business performance but can serve as an integral part of the national growth strategy for private business, for the public sector, for Nigeria and for Africa at large. It is a mix of a formal and informal forum, focused on networking, capacit y building, advocac y, forming alliances, providing funding opportunities, providing information for opportunity leverage, creating exposures, education and enhancing women collaboration and endeavours in the industry. Research has shown that women are better managers and because the industry is so challenged, we believe that if women step in to compliment the men, it will help to close the huge gap we currently have in the industry. The gap is just too wide and the industry is not meeting expectations. Like I mentioned earlier, a 10 per cent contribution to the nation’s GDP is far below expectation so we believe that if we have women become major players in the industry there will be a lot of improvement geared towards the oil becoming a transformational resource.

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So, we have a ten year outlook because by 2030, we will be expected to show forth what we have been able to achieve in line with the SDG targeted time frame of 2030. We want to act as the official link between institutions in promoting dissemination of vital information of mutual interest and benefits to women in the industry. We want to be able to provide mentorship and role model structures for industry’s new entrants, young women professionals, and girls in STEM and so on. We want to foster women entrepreneurial participation in the industry during bids, tender for public and private sector projects and so on. We want to be able to initiate and execute programmes, projects and activities geared towards the developmental objective of the forum. We have several events that will create exposures and opportunities for women to come together to network, enhance their career skills, share experience, explore opportunities, collaborate and advance their personal career and business goals. You belong to some global bodies of professionals; kindly tell us a few of these bodies and what they represent. There are quite a number of them like you rightly observed and I will just stick to the ones that relate to the industry: the energy sector. As a management consultant, it is expected that one would extend their learning tentacles to different professional bodies in order to learn and network. At the Association for Professional Consultant Trainers and Coaches, UK (APCTC) for example, it is a platform for management consultant s to further enhance their practice as consultant, trainers or coaches. There is OWIT (Organization of Women in International Trade) which is an international body; there is Institute of Planning (FIPN) that looks at professional and strategic planning for projects. There is Global Women Network for

Energy Transition (GWNET) based in Australia where we basically want to see women practice and get involved in the energy transition. As such, we review current energy mix and transition from just fossil fuel to the other different mixes that will enable renewable energies. We have the WEN, WEOG actually started from the WEN inspiration. WEN is Women’s Energy Network and it is all across America and WEOG is like their protégé since 2018. I am also a member of the Society of Petroleum Engineers (SPE). I do a few things with them as well. There is a new one, Women in Sustainable Power, Africa (WISPANET) and the objective is to achieve the goal of powering Africa. It is facilitated by the Future Energy Group. Others are FOBES Women, Women in Renewable Energy Africa (WIREA). It is a platform to increase knowledge and increase exposure, to learn, to see what is working in other locations, countries and communities and to see how we can adopt, adapt and replicate same in our own community. For me, that is the passion around joining these professional bodies. How did you find yourself in STEM and what is your advice to youngsters? In my case, it is because of my family background, my father was an engineer and so everybody studied science. I studied pure and applied mathematics as my first degree. Then for second degree, I studied operational research (OR). OR is actually used to design strategies and it can be applied in every strata and sphere of life using sciences. For youngsters, mathematics is the root of STEM, engineering and anything sciences, so you have to understand at least the basics of mathematics. But the challenge we have in this part of the world is the way mathematics is taught. There is that mind-set that it is a very tough subject so we need our educationists to let the learners

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ENERGY WOMAN the poverty headquarter of the world. I want to see a Nigeria where our resources will indeed transform to wealth, not just for some very few minority but for the majority of the citizens; where equality across board is embraced and achieved. I dream to see a Nigeria where our roads are fixed. We do not have to wait for a foreign company to import bitumen into Nigeria before we can have bitumen or asphalt to fix our pot-holes.

know it is no big deal so they can embrace it. As a matter of fact, it is so easy and straightforward. Understand the formula and replicate it. Understand the logic and replicate it.

realization of the potentials and opportunities of the God-given resource called oil and gas.

Personally, I try to let young girls understand mathematics, once you get mathematics right you can get any other subject in STEM right. You can understand sciences, engineering. With good understanding of mathematics, the sky is your limit in playing big in the STEM value chain.

Managing work-life balance is very critical to me in the sense that there was a particular point in my life I did not have a good balance. I was more of an all-work-and-no-play kind of person. But, thank God I was able to realize the need to quickly adjust and that is the message I would like to give to many ladies out there who are probably tilting towards just one side. It is good to quickly adjust. Life is supposed to be enjoyed and there has to be a balance.

I see a Nigeria where all the basic amenities, infrastructure will be there to make life simple and easy for the citizens; where there is power, energy; where roads are fixed, where education and water are not at exorbitant cost to the poor citizens but the responsibility of the government from the dividends and profits made from the natural resources God has blessed the nation with.

For me, I am a very adventurous person, I love traveling, discovering new things and making friends. So, I make sure I find a balance between work and what I enjoy doing. Worklife balance is very important.

I dream of a Nigeria where people do not have to run away to other countries but rather come in to have a better life. I see a Nigeria where rather than being a net importer of different products and finished goods, is a net exporter of finished products and goods to other nations.

Are you a feminist? No, I am not a feminist. When God created the earth, he created male and female. Initially he made just the male but later he said it is not good for the male to be alone, the female will be a help meet. So my personal advocacy is for balance. Anywhere it is found lacking, let us try and bring in it for the benefit of everybody. It is not about trying to downplay the headship of the man, it is about enhancing what we have and maximizing that salient knowledge that has been there and is not being tapped. Let the women step in to help and fulfil their purpose. This is not just something to happen in the home front, it is across. So it is not good that men alone should be in the energy and oil sector, the women should step in to help make full

How do you manage work-life balance?

What is the Nigeria of your dreams? The dream is huge and massive but I am going to limit it to my dream for the oil and gas industry. One day I want to see a Nigeria where the standard of living will be commensurable with the resources the country is blessed with. I want to see a Nigeria where we will not be called the largest oil and gas producer in Africa and yet

I dream to see a Nigeria where the crude oil will be refined and we will be able to maximize our extractive mineral resources to grow the wealth of the nation.

I dream of a Nigerian brand that will be strong, such that people do not have to cut corners; a Nigeria where the portion of the national cake which corruption has eaten so badly is moulded back and fixed; a Nigeria where every child is proud to be a citizen of; a Nigeria where every drop of crude and every smear of gas turns to national wealth. I see a glorious Nigeria.

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INFRASTRUCTURE

NNPC, First E&P Announce Arrival of FPSO To Nigeria By Daniel Terungwa

he Nigerian National Petroleum Corporation, NNPC, and First Exploration & Petroleum Development Company Limited, First E&P, have announced the arrival of the Abigail-Joseph Floating Production Storage and Offloading, FPSO, unit to the shores of Nigeria. In a statement obtained by Vanguard Maritime Report, recently, First E&P said prior to her sail-away, the FPSO underwent upgrade, refurbishment and life extension works in Keppel Shipyard, Singapore, to meet specified standards and specifications, noting that “the excellent partnership between NNPC, Department of Petroleum Resources, DPR, First E&P, Yinson and Keppel Shipyard, helped ensure these critical predeployment activities for the FPSO were completed in record time.”

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According to the statement, a team of young Nigerian professionals were part of the successful extension works in the Keppel Shipyard and they will form an integral part of the FPSO operations team in the production phase. It added that the FPSO is a 274 metres long converted Suezmax trading tanker. It is selfpropelled with 11 cargo storage tanks, two slop tanks and six dedicated water ballast tanks including fore and aft peak tanks. “The FPSO will be deployed in the Anyala and Madu fields, offshore Nigeria as part of OMLs 83 & 85 field development, Nigeria’s first wholly indigenouslyexecuted integrated oil and gas project in the shallow offshore. The processing system on the FPSO includes facilities for oil separation, stabilisation, produced water treatment, gas treatment and compression. “The processing and storage capacities include oil processing of 50,000 barrels

of oil per day, produced water treatment of 20,000 barrels of water per day, gas handling of 39 million standard cubic feet per day and cargo storage capacity of 700,000 barrels. The FPSO will be operated on behalf of First E&P by Yinson. “The ongoing development drilling campaign in the Anyala field is focused on drilling and proving expected oil reserves for development. A total of seven development wells have been planned and approved by DPR,” the statement said. Anyala field will be developed along with the nearby Madu field (OML 85) through a shared production facility. The produced oil will be processed through the AbigailJoseph FPSO. Associated gas and non-associated gas developments will be fully integrated into a gasintegration hub designed to feed an export line for the local gas market.

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INFRASTRUCTURE

‘N43.24bn Ibadan Dry Ports Project Goes To FEC Soon’ By Esther Mordi

he Full Business Case Compliance of the Ibadan Dry Port (IDP), estimated to cost $94m (about N43.24bn), will soon be developed for approval by the Infrastructure Concession and Regulatory Commission (ICRC) and the Federal Executive Council (FEC). Rakiya Zubairu, the Head, Public Relations, the Nigerian Shippers’ Council (NSC) said this in a statement recently.. The statement said this is the next phase of the Public-Private Project (PPP) that is being guaranteed by the NSC. The 80,000 TEU capacity dry port is to be built on the basis of a Public-Private Partnership basis. On completion, the facility is expected to contribute to addressing the problem of port congestion and gridlock in Apapa as it will be designated a port of destination where cargos will be consolidated for import and export, especially in the South-Western part of Nigeria. Among other uses, the dry port

will provide a competitive cargo sorting centre, bulk breaking as well as cargo-tracking and truck management services. The LagosKano standard gauge railway currently under construction is aligned to the proposed dry port, making it easy to convey cargo from the seaports in Lagos and to all destinations along the route. Already the first phase of the negotiation had established the economic viability of the project as well as the utilisation of local content at each stage of development and operation of the facility. The statement said: “Having concluded this stage, an Updated Full Business Case Compliance report will be produced. “A draft agreement will be presented to the Federal Ministry of Justice and sent to the Infrastructure Concession Regulatory Commission, ICRC, for vetting, after which the Minister of Transportation will present the agreement to the Federal Executive

Council. “The concessionaire will then be taken to the site for sodturning. “It is expected that construction will commence immediately after the ceremony “The time-line for completion is twelve months.” She said, that was the conclusion of another round of negotiation with the concessionaire. The preferred bidder for the project is the CRCC who was led by its deputy managing director, Jacques Liao, during the negotiation. The negotiation was moderated by the Federal Ministry of Transportation led by the acting Permanent Secretary, Dr Hussani Adamu and the Director, Maritime Services, Auwalu Suleiman, the Director-General of Infrastructure Concession Regulatory Commission, ICRC, Engr. Chidi Izuwa. Amb. Jummai Katagum who represented the Federal Ministry of Finance was also part of the 4-day negotiation.

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INFRASTRUCTURE USTDA Provides Support For New LNG Infrastructure In Nigeria By Emeka Enunwa

MARITIME

NIMASA Boss Celebrates Berth Of Largest Container Vessel In Nigeria, Lauds NPA MD. Nigeria Becoming a Sub-regional Hub- Jamoh

he U.S. Trade and Development Agency (USTDA) has awarded a grant to Nigerian natural gas supply company, Green Liquified Natural Gas (GLNG) to support Nigeria’s increased utilization of natural gas for power generation, local industry and additional economic growth. “This project will support the diversification of Nigeria’s economic development while creating opportunities for U.S. companies to develop world-class infrastructure,” said Thomas R. Hardy, USTDA’s Acting Director. “It will also build upon USTDA’s commitment to working with our partners in Nigeria to develop and expand the country’s natural gas options.” Specifically, USTDA’s grant will assess the viability of an LNG liquefaction and distribution facility and associated regasification and distribution stations in Southwestern Nigeria. GLNG selected the U.S. company NOVI Energy LLC to conduct the study. “We are proud to announce our pathbreaking LNG project in Nigeria, which will have a significant impact on Nigeria’s goal of pursuing a sustainable, environmentally friendly, alternate fuel-based economy,” said Mr. Anil Ahluwalia, Director of GLNG. This project supports the U.S. government’s Prosper Africa, Power Africa and Doing Business in Africa Initiatives.

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he Director General of the Nigerian Maritime Administration and Safety Agency, Dr. Bashir Jamoh has expressed his delight over the safe and successful arrival of what is now the largest container vessel to berth in any port in Nigeria. Stressing that this development will enhance the nation’s maritime competitiveness in terms of tonnage capacity and sub-regional hub status attainment, the DG noted in his phone remarks to Maritime Info shortly after the agency’s management retreat in Lagos, that this achievement was long overdue given Nigeria’s vast maritime potentials.

At exactly 1630 hrs, on Saturday the 15th of August, the MAERSK STADELHORN, a 300 mtrs Container Vessel safely berthed in Onne Port for her first voyage to Nigeria. Jamoh also commended the Managing Director of the Nigerian Ports Authority, Hadiza Bala Usman for her sterling leadership and management prowess, especially in providing the best in class professional support for the NPA pilots and mariners who were crucial in delivering on this major milestone of positioning Nigerian ports as sub-regional hubs for the entire marine environment of the Gulf of Guinea.

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MARITIME

Samsung To Employ ICT Tools To Improve Shipbuilding In Nigeria By Ikenna Omeje

amsung Heavy Industries (SHI) has said it is aiming to adopt Cloud, Big data and Internet of Things (IoT), among other advance technological tools to improve shipbuilding and operation methods in Nigeria. The company made this known in a statement on its official website. It said, “The company aims to use Cloud, Big Data, and loT, among other advanced tools, to make shipbuilding and operations on the fabrication and integration yards smoother and smarter. The technologies to be implemented will facilitate more efficient ways of working, lowering the cost of operations, increasing safety, and modernising the shipbuilding industry in Nigeria. Sustainable method of production, based on digital modes of operations, is the need of the hour as every country

makes its move towards energy transition.” It further noted that Innovations currently being worked on have the potential to bring about radical changes in the shipping industry, fostering the use of eco-friendly technology, a switch to digitised management and self-reliance on inspection for offshore engineering and more. The Managing Director of SHI, Jejin Jeon, said the company has identified Nigeria and the West Africa sub-region as an emerging market with an abundance of opportunities. “Our investment in West Africa is a long term one, rooted in helping develop local human capacity by leveraging our fabrication and integration yard to the benefit of the entire West African maritime industry. The new and modern ways of working will not only

empower Nigerian maritime industry, but is a promising opportunity for the country’s youths who will receive hands on training in these necessary tools of smart working that are soon to become the norm in every industry in the near future,” he said. Jeon stressed that Samsung believes in having big dreams and visions for the future and following them with passion. Given that the present and near future is digital, it is high time the shipbuilding industry started digitising its ways of working. “We are looking forward to introducing these innovations to truly transform our ways of working in a complex industry such as shipbuilding. We remain committed to ensuring that our relationship with the Nigerian community remains strong by continuing to train local staff in technical vocational skills,” he said.

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MARITIME

NPA Halts Licences Renewal For Shipping Firms Over Holding Bay Crisis By Esther Mordi up with the terminal operators at the ports. But when we have 36 No truck locations all around the Apapa environment, how do you think you are going to sanitize the area? In the Apapa environment, we have 36 truck parks that lack any form of equipment. I have always advocated for us to have larger truck parks that are outside of the port environment, dedicated for that purpose and only come when we are using the call-up system. “Nigerian ports are not responsible for providing truck terminals. What we know is that truck parks are local government issues, it is a Lagos State issue, so Lagos State Government must rise up to that and provide those parks,” she said.

Hadiza Bala Usman

he Nigerian Ports Authority (NPA), has stopped the renewal of licences for shipping firms who fail to provide holding bays for empty containers. Failure of the shipping firms to establish a holding bay where empty containers are to be stacked is a major factor for the congestion currently being experienced at the ports. The Managing Director, NPA, Hadiza Bala Usman, who confirmed this during the 14th yearly, Business Law e-conference, said: “We actually refused to renew licences to shipping companies; they have to give evidence of having empty container holding bays that is commensurate with the vessels they bring in. “I encourage stakeholders to write directly to us to the extent that you identify issues affecting this procedure, and I will also push that in our system to ensure there is adequate monitoring. “I will get our team to get back to you by next week so that we can ensure that the shipping companies adhere to what was agreed in terms of maintaining the balance between what is coming in and what is going out.

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Bala Usman also advocated for an intermodal system to ease the movement of cargoes, and attributed the incompletion of the rail project to the COVID-19 pandemic. “I think there is a need for us to recognize the need to use intermodal transportation systems. You can’t have 90% of your cargoes being moved through the road alone; the road will get congested and will be spoilt. We must strengthen the utilisation of inland waterways. We must drive and have our rails system concluded; if not for the COVID-19, we would have concluded our rail connectivity,” she said. She also bemoaned the dearth of truck parks, stressing the need for designated places for trucks to stay and wait for call-up, saying: “If we don’t have designated places for trucks to wait and only to wait for a call-up, the trucks will just wake up and drive to the ports. “Lagos State Government must take ownership in providing dedicated truck terminals, where there will be linkage and a call-

She added that to ease the situation, NPA had converted its Lilypond Terminal to a Truck Park, while arrangements are ongoing with Lagos and Ogun State governments to provide more truck parks. Agreeing with Usaman, the Managing Director, Connect Rail, Edeme Kelekume, said: “There is no bigger word to describe the crisis we are going through with empty containers. The cost implication is running into billions of naira. The demurrage cost is too high and beyond what smaller players, especially the small and medium enterprises can handle. “Having access to where you can keep your empty containers is one thing, and the holding bays around the ports are not enough, so there is a need for more holding bays. “The infrastructure at the ports are not adequate, and this is also a challenge, as you don’t know how you can quickly be attended to and nobody is addressing the losses that are incurred. The Shipping lines must be compelled by the NPA to comply and provide holding bays,” he said.

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MARITIME

NIMASA, Customs Collaborate To Plug TIP Loopholes By Jerome Onoja

Col. (rtd.) Hameed Ali (r) with Dr. Bashir Jamoh

h e Nige ria n Ma ritim e Administration and Safety Agency, NIMASA, and the Nigeria Customs Service, NCS, have agreed to join forces to close loopholes in the Temporary Importation Permit, TIP, system that importers often exploit to avoid levies due to the government. DirectorGeneral of NIMASA, Dr. Bashir Jamoh, stated this in Abuja recently, when he visited the ComptrollerGeneral of Customs, Col. Hameed Ali (rtd). Jamoh said the temporary import permit issue was one of the biggest challenges faced by the maritime sector, stressing that it has denied the Federal Government huge revenue.

is indigenous shipowners that bear the brunt.”

Ali spoke in a similar vein, saying it is important for the NCS and NIMASA to develop a common platform for dealing with problems arising from the TIP. Jamoh stated, “The biggest issue we have has to do with temporary importation. What we observed is that people capitalise on the good gesture of government policies. “Those that are benefiting from this temporary importation bring in their own ship and after one year they will take it back to their country and import back with a different name.

The Director-General said the Merchant Shipping Act provided that vessels used in importation should be registered with the Nigeria Ship Registry, but in most cases, the importers did not. He called for greater synergy between NIMASA and NCS, and indeed, all agencies in the maritime sector, to address pertinent issues and improve the sector. Jamoh said it was in pursuit of such cooperation that a regular meeting of heads of maritime agencies was recently initiated. The meeting debuted on July 7 in Lagos at the Nigerian Shippers Council (NSC). It had in attendance Executive Secretary of NSC, Mr. Hassan Bello; Managing Director of Nigerian Ports Authority (NPA), Hadiza Bala Usman; Managing Director, National Inland Waterways Authority (NIWA), Dr. George Moghalu; and Rector, Maritime Academy of Nigeria, Oron, Commodore Emmanuel Effedua (rtd). Jamoh said the essence of the meeting was to identify and speedily tackle challenges faced by operators in the sector without the impediments of official bureaucracy. He invited the NCS Comptroller-General to join the heads of maritime agencies meeting.

“They do it constantly and this is to the disadvantage of our Nigerian shipowners.” He said Cabotage trade, which falls within the core functions of NIMASA, was suffering as a result of the abuse of the temporary import permit, and, “At the end of the day, it

“After the meeting, we decided to incorporate the Freight Forwarders’ Regulators to be on board,” Jamoh stated, adding, “The MD NPA and I have both agreed to extend the fellowship to you and you have the liberty to join us via zoom.”

Jamoh appreciated the efforts of the NCS under Ali to curb smuggling in the country and enhance revenue generation. Responding, the Comptroller-General of Customs pledged the commitment of the service to pooling resources with NIMASA to address the TIP issue and other problems in the sector. He said there was need for both agencies to design a common framework for tackling the issues. Ali said such approach would ensure that if Customs registered a ship and gave it a TIP, NIMASA would also have records of that registration on its own platform. According to him, “We should have more identity of the ship beyond the name, as name can be erased and another name used. We must now collectively get some identity of the ship that goes beyond name that should be registered in our records and yours so that if there is recycling of the ship, using that platform, we should be able to identify the ship and be able to apply the law as it is. “We should create that synergy based on ICT. I request that your IT staff synergise with ours to develop a platform that will create that collaboration, such that everything we record or register will reflect in your own record.” The Comptroller-General said the Customs was in the process of launching two patrol boats that would go beyond the creeks, to enhance maritime security. “We have mounted the necessary machine guns, one had an accident but it has been repaired, and very soon we will launch them into operations,” he said. “We will keep you posted as we intend to synergise with you to ensure the safety of our waterways,” Ali added. He also stated, “It is my hope that we will strengthen the relationship and increase the synergy between us as maritime operators, and, most importantly, to ensure that not only the revenue aspect of it is improved, but also to secure our waters. “The security of our people is more important than the revenue, because no matter how much you collect, if our people are not settled, or not in peace, then the whole essence of the revenue is bastardised. “So it is our hope that we join hands with you and make sure that we work assiduously to ensure that our waterways are safe and profitable.” Ali commended the NIMASA Director-General for the CEOs’ forum initiative, saying it would help to boost the sector.

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MARITIME

Maritime Agencies Adopt Modalities To Address Overlapping Functions By Jerome Onoja

L-R: Director General, Nigerian Maritime Administration and Safety Agency (NIMASA), Dr. Bashir Jamoh , Managing Director, Nigerian Ports Authority (NPA) Hadiza Bala-Usman (middle), Executive Secretary, Nigerian Shippers Council, Barr. Hassan Bello, during the Maiden Meeting of Heads of Government Parastatals in the Maritime Sector.

arastatals under the Federal Ministr y of Transpor tation have agreed on modalities for handling areas of overlap in their responsibilities. DirectorGeneral of the Nigerian Maritime Administration and Safety Agency (NIMASA), Dr. Bashir Jamoh, disclosed this in Lagos after a meeting of heads of the parastatals at the headquarters of the Nigerian Shippers Council (NSC). Jamoh said the agreement followed the work of a ministerial committee, stressing that meetings like this are necessary to build synergy and create the right atmosphere for the overall progress of the economy.

four months. Due to the proximity of our corporate headquarters to each, a lot of gains will be achieved in a short while without the usual official bureaucracy.”

He stated, “We have held the inaugural meeting for improved synergy and we hope to hold it on a monthly basis for the next

He said there was no better time to improve synergy among agencies under the Federal Ministry of Transportation than now, “When

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The Director-General added, “From our discussion and deliberations, we have decided on so many issues that concern national development, overlapping functions, and others. “We have a committee inaugurated by the ministry of transportation and we have been working for close to a year now. We have now decided on who should take what responsibility and we are going ahead with that.”

the COVID-19 pandemic and the accompanying disruptions to business and economy have placed a great deal of responsibility on the maritime sector as a vital support to the economy and key medium for the movement of essential supplies. ” Those who attended the meeting were Executive Secretary of NSC, Mr. Hassan Bello; Jamoh; and Managing Director, Nigerian Ports Authority (NPA), Hadiza Bala Usman. Managing Director, National Inland Water ways Authority, Dr. George Moghalu, and Rector, Maritime Academy of Nigeria (MAN), Oron, Commodore Duja Effedua (Rtd), joined via Zoom.

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POWER

Azura Power Deal: Nigeria Not Liable To Pay $1.2bn – Presidential Aide By Ikenna Omeje about this matter, there is no doubt at all that the binding agreements which brought about the plant were signed in 2013 and 2014. On April 22, 2013, the Power Purchase Agreement was signed. “This is the contract that contained the Take or Pay clause, which is now the crux of the manufactured controversy. That clause is however standard in PPAs. What it says is that government will pay for the energy produced by the plant, whether it uses it or not. Without that assurance, nobody would invest money in such a huge power plant. Large infrastructure projec ts are executed using project finance principles and debt, guarantees of repayment are always needed to reach financial close.

he Special Adviser to the President on infrastructure, Ahmed Zakari, has said that Nigeria is not liable to pay $1.2 billion according to the agreements signed before the takeoff of the 461 megawatts Azura power plant in Edo state.

truth. “Since the Buhari government had chosen not to repudiate the deal, it went ahead to issue the required legal opinion and signed the World Bank guarantees that had been initiated in April 2014. In fact, the main Power Purchase Agreement was signed in 2013.

Based on the agreement, Nigeria is obligated to pay Azura $30 million monthly with or without power being taken from the generation company, which has placed a heavy financial burden on the country. There is assertion in some quarters that if the country wants to exit from the contract, it will have to pay Azura an estimated $1.2 billion and take over the plant. “Over the past week, there has been an unnecessary controversy about the Azura-Edo Independent Power Project (IPP) especially the concerns about who signed the transaction documents and who did not sign, thus ignoring the consequences of backing out of the agreements by the Federal Government,” he said.

“If at the point the Buhari government came into oﬃce, it repudiated the contracts, what would have happened? First, because there was already a valid and binding contract between the Federal Government and Azura-Edo, that would have led to an international case similar to the P&ID scenario. “In the P&ID case, the Federal Government was sued for breaching the terms of a contract to build a gas processing plant. Despite the fact that no part of the plant was ever built and no government or World Bank guarantees were given, the Arbitral Tribunal found Nigeria liable in the sum of $9.6 billion. So, clearly, guarantee is not the issue at stake here,” Zakari said in a statement on Thursday.

“The Azura-Edo IPP is a functional 461MW power plant. It is owned by a group of investors led by an internationally reputed firm – Actis and includes the Edo State government as part of the investment consortium. Today, the plant supplies over 8% of the power on Nigeria’s National Grid. Clearly, the controversy as to who signed the agreements has no real basis, if indeed the only quest is for the plain

He added: “Third, it would definitely have aﬀected our credit rating and credibility as an investment destination. Some of the most reputable international banks and investors that were involved in the project include Development Finance Institutions of the US, UK, France, Germany, the Netherlands and Sweden,” the presidential aide said. “Again, laying out the facts already stated in previous communication

“On October 22, 2014, the second agreement was signed. That is the Put Call Option Agreement (PCOA), which establishes the formula for determining the amount payable by government, if it has to take over the Plant. The PCOA for power plants is actually a novel approach pioneered in Nigeria. It ensures that unlike other contracts where a contract default would trigger penalties alone, in the case of Azura a default would allow Nigeria to purchase the asset. This ensures that the country has a contingent asset alongside a contingent liability. The PCOA approach has now become standard in West Africa and is being adopted across the developing world. “Those who argue that the signing of the World Bank Guarantees makes the Federal Government under Buhari responsible for contracting Azura need only to look at the two basic transaction documents. Another curious mischief in this controversy is the assertion that Nigeria will become liable in the sum of $1.2billion if it defaults on the Azura contract. “Nowhere in any of the documents signed from 2013 to 2015 is any such figure mentioned. The only possible payout indicated in any of the agreements is in case the put and call option is activated. In that event, the cost of the plant would be worked out using a formula and become due for payment, but at least Nigeria will get in return a functional 461MW plant.”

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POWER

Nigeria to Deliver 5GW Of Electricity By 2022 – NNPC By Daniel Terungwa gas pipeline, Usman raised the hope for virtual supply using mini-LNG/ CNG trucks to supply gas to remote demand centres.

ith the kick-of f of the construction of a number of gas projects, particularly some major pipelines, the Nigerian National Petroleum Corporation (NNPC), said it will deliver about 5GW or 5,000 megawatts power by 2022. Since the privatization of the power sector in 2013, Nigeria has struggled to achieve sustainable electricity supply, but has been frustrated by the shortage of gas to power the plants as well as slowing the nation’s industrialisation and gas monetisation drive. NNPC hinted that the new generation capacity would be boosted by additional 5 billion cubic feet of gas daily by 2022, while also exploring partnerships for transmission and investments to enhance evacuation and power improvement. This was made known at a webinar, recently, where stakeholders, who gathered for the Nigeria International Pipeline Technology & Security (NIPITECS), strategized on ways of reducing cost in the industry, insisting that the development of pipelines is critical to harnessing the nation’s oil and gas resources. NNPC’s Chief Operating Officer, Gas and Power, Yusuf Usman, said during the webinar that with the expected delivery of NLNG Train 7 by 2024, the Federal Government is working on the completion and inauguration of the Escravos–Lagos Pipeline System (ELPS) I, and B3 gas pipelines to ensure connectivity between

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the Eastern and Western parts of Nigeria. Usman also noted that the construction of the AjaokutaKaduna-Kano, and two other gas pipelines, will ensure gas availability in the Northern part of Nigeria and interconnectivity within the East. He said some midstream processing facilities like the ANOH Gas Plant will guarantee gas supply to the domestic market, as the country pursues the actualization of the Seven Critical Gas Development Projects (7CGDP), to deepen the penetration of its gas resources, notably, LPG, CNG and virtual LNG in-country. According to him, the country would also secure and market the Nigerian Petroleum Development Company Ltd. (NPDC) joint venture portion and Production Sharing Contract (PSC) gas volumes, while pursuing the development of gas-based industries like the Brass Fertilizer project. Usman further said NNPC is looking to engage the Transmission Company of Nigeria (TCN), and generation companies (GENCоs), to execute partnership agreement or framework for expanding the nation’s transmission network Stressing the need to unlock power plants both existing and new, he said Nigeria would focus more on the regional market through the West African Gas Pipeline (WAGP), Trans-Saharan Gas Pipeline, among others. Noting that about half of Nigeria’s population live in rural areas that could not be economically supplied with gas via conventional

According to him, the move would stimulate socio-economic development, lower government import bills on white products, and promote sustainable energy and indigenous energy resource to power the economy Also speaking, the Group Chairman of Oilserv, Emeka Okwousa, said except Nigeria focuses on expanding pipeline networks, especially with financing models that won’t put pressure on the government, driving the needed investment for exploration of hydrocarbon resources may remain unattainable. While noting that there is insufficient pipeline infrastructure to support the domestic gas market aspiration in Nigeria, Okwousa insisted that “pipeline infrastructure deficit is a key disincentive to FID for upstream gas.” He said while Nigeria holds the 11th largest oil reserves as at 2019, and the ninth largest natural gas reserves, there was a need for investment in the sector, as exploration of gas fields are mostly associated gas. He said security of the pipelines remain critical, adding that just like the AKK pipeline where Supervisory control and data acquisition (SCADA) is being deployed to monitor the pipelines, there was the need to create awareness on the nature of gas as well as engaging local communities to protect the assets. Chairman of Pipelines Professionals Association of Nigeria (PLAN), Geoff Onuoha, noted that pipelines remained critical assets to the nation. Onuoha said pipeline development has become more critical to Nigeria going by the current push for gas development, while urging a cost effective approach to building and maintaining pipelines. He added that local participation, innovation, environmental and social dimensions are critical considerations the country must prioritise in developing the infrastructure.

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Articles inside

Nigeria to Deliver 5GW Of Electricity By 2022 – NNPC

Azura Power Deal: Nigeria Not Liable To Pay $1.2bn – Presidential Aide

Maritime Agencies Adopt Modalities To Address Overlapping Functions

NIMASA, Customs Collaborate To Plug TIP Loopholes

NPA Halts Licences Renewal For Shipping Firms Over Holding Bay Crisis

Samsung To Employ ICT Tools To Improve Shipbuilding In Nigeria

USTDA Provides Support For New LNG Infrastructure In Nigeria