Majorwaves Energy Report May 2020 by majorwavesenergyreport

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MAY 2 0 2 0 VOL 3 NO 5

MAJORWAVES ENERGY REPORT

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Marginal Fields amid Global Recession NCDMB Donates N70m to PTF on COVID-19 Nigeria Approves N11.52bn Jebba Hydropower Plant Turbine Rehab Project FAR to Sell all or Paa of its Interest in the Sangomar Development Oï¬&#x20AC;shore Senegal Equatorial Guinea Grants Two Year Extension for All Oil and Gas Licences

Majorwaves Energy Report MAY 2020, Vol 3 No 5

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Majorwaves Energy Report MAY 2020, Vol 3 No 5

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Majorwaves Energy Report MAY 2020, Vol 3 No 5

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Majorwaves Energy Report MAY 2020, Vol 3 No 5

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As a couple of African countries put up oil field assets for sale to investors, Nigeria has announced its plans to do same. Our cover story examines the outcome of previous bid rounds and the likely effect on the new announcement amid a shrinking global economy, occasioned by Covid-19. The Nigerian Content Development and Monitoring Board, NCDMB has continued to show solidarity in the fight against Covid-19 by making a donation of N70mn to the Presidential Task Force on Covid-19. We bring you report on some of its activities, including the recent launch of BentPlus, an online platform for local creation of digital technologies. It is meant to disrupt the oil industry and bring tech solutions to numerous ancillary services. Incentives continue to be a tool for attracting and keeping investors. To this end, Equatorial Guinea has extended all oil and gas licenses by two years, considering the lull in the industry following impact from Covid-19. Ngozi Oyewole is our Energy Woman for the month. The founder of Noxie Limited and its subsidiaries stands out among the few women entrepreneurs in Nigeria’s energy space. The quality of her personal protective equipment (PPE) matches global standards. Enjoy these and other interesting stories in our May issue. Finally, Majorwaves Energy Report expresses its appreciation for the heroes of these trying times – the doctors and other healthcare workers. We hope and pray a cure or a vaccine is found as soon as possible. Please 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 Port Harcourt Arit Dan Emmanuel Akporhouno 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

Oil Price Doubles as Output Cuts Increase Demand

An oil ministers’ meeting in May. Officials from OPEC countries and Russia are expected to continue cuts in their output to support the price of oil.

il’s rally resumed after prices doubled early in May, amid optimism that output cuts are easing a huge supply glut and demand losses have bottomed. Futures in New York rose above $25 a barrel after earlier breaking above their 50-day moving average for the first time since January. Russian oil production was down 16% in the first five days of May, Interfax reported, while Plains All American Pipeline LP sees close to 1 million barrels a day of Permian shut-ins in May. Output in North Dakota was down by 450,000 barrels a day, according to state data, though some shale drillers said they may restart output if prices rose above $30 a barrel. OPEC+ began implementing 9.7 million barrels per day of production curbs on May 1, which along with some early signs of demand recovery has helped to ease fears the world will run out of storage space for crude and fuels. The Trump administration is pivoting to “phase two” of its virus response in an effort to reopen the nation’s economy. While it’s possible the worst is over

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for oil markets, most analysts don’t see a rebound to pre-virus levels of consumption for at least a year, with some questioning if it will ever happen. The risk of a second wave of infections in the U.S. as states reopen can’t be discounted, while deteriorating relations between Washington and Beijing may hamper the global economic recovery. “The Russian news suggests a faster full compliance with cuts versus the past,” said Giovanni Staunovo, commodity analyst at UBS Group AG. “There’s also likely some technical buying from momentum investors.” Prices: – West Texas Intermediate rose 2.9% to $25.28 a barrel as of 10:35 a.m. in London – Brent added 1.7% to $31.51 a barrel – Dated Brent, a reference for twothirds of the world’s oil flows, was at $23.83 on Tuesday, according to traders monitoring prices from S&P Global Platts.

Winners from last month’s oil market rout are now starting to emerge. Hedge fund Westbeck Capital Management, which posted its best ever month in April after being short oil prices in the front of the curve, said the bull case for crude is now “simply exceptional.” Pierre Andurand’s commodities fund is now up almost 70% this year after further gains in April. U.S. crude stockpiles rose by 8.44 million barrels last week, the American Petroleum Institute reported, according to people familiar with the data. That would be the smallest increase since the week ended March 20, if confirmed by Energy Information Administration figures due Wednesday. Supplies at the storage hub at Cushing, Oklahoma, rose by 2.68 million barrels, the API said. “The market’s focus will remain the state of crude oil inventories at Cushing and U.S. production,” said BNP Paribas SA’s Head of Commodities Strateg y Harry Tchilinguirian. “Last week, the market took some comfort from the fact that the pace of additions to Cushing storage moderated.”

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INDUSTRY NEWS

Shell Donates PCR Machines, Ventilators, Equips Rivers for Coronavirus Testing

Rivers State Governor, Nyesom Wike, displays one of the coronavirus testing machines donated to the state by the Shell Petroleum Development Company (SPDC), at the Government House, Port Harcourt, on Wednesday. The governor is flanked by SPDC’s Deputy Managing Director, Simon Roddy (left), and the Zonal Manager, Nigeria National Petroleum Corporation, Adebola Aderibigbe.

ivers State is set to start testing for COVID-19 in Port Harcourt with the receipt of the state’s first set of testing equipment from the Shell Petroleum Development Company (SPDC) among many other medical hardware and consumables presented to the state governor, Chief Nyesom Wike early in May. SPDC’s Managing Director and Country Chair, Shell Companies in Nigeria, Osagie Okunbor, who presented two Polymerase Chain Reaction (PCR) machines, the main testing equipment, ventilators and other medical items at the government house in Port Harcourt, said SPDC and its joint venture partners were committed to supporting the state to stop the spread of COVID-19 or any disease outbreak in the state. Okunbor, who was represented by the Deputy Managing Director of SPDC, Simon Roddy, said, “While we remain committed to supporting the state government to deepen its efforts at managing the pandemic, we recognise inadequate testing capability in the Niger Delta and it is in response to this that we are presenting the state with COVID-19 compatible PCR machines and kits, while further extending medical equipment support to the holding centre at the Eleme General

Hospital.” The SPDC MD said the donation, the third in a series, was aimed at further enhancing the clinical capacities and capabilities at the Rivers State University Teaching Hospital. In its first COVID-19 support to the state in March, SPDC had provided three vehicles, including fueling and maintenance, to aid in contact tracing. The second set of donations was made on April 7 when the company gave an ambulance, generator and medical equipment to enable the operations of the State Holding Centre at the Eleme General Hospital, for any disease outbreak in Rivers and neighbouring states. Receiving the donations, Governor Wike said, “Thank you Shell and NNPC for your partnership that has resulted in the donation of these PCR machines. Now you have supported the state. The COVID-19 pandemic is a war, more than the conventional warfare, and everybody must work together to win it. The lives of my people are very important to me. I took an oath to protect lives and property and we must do everything that we can to mitigate and reduce the transmission of the disease.”

In his remarks, NNPC Group Managing Director, Mallam Mele Kyari, who was represented by the corporation’s Zonal Manager, Mr. Adebola Aderibigbe, pledged NNPC’s continued support to the state to ensure minimal impact of the pandemic in the state and the Niger Delta region. The equipment donated included ox ygen concentrators, suction machines, defibrillator, ventilators, wheeled stretchers, swabs, personal protection equipment including googles and N95 masks, ambulance, and a generator; while a Shell-funded off-grid power solutions company, All On, has also completed the solarpowered electrification project, providing the state’s holding centre in Eleme with electricity from a 9.6Kw solar and 30kWh battery storage solution. All On executed the multimillion-naira project through one of the rising innovative firms in the off-grid sector, GVE. Also at the donation event were the Secretary to the Rivers State Government, Dr. Tamunobaabo Wenike Danagogo; The Rivers State Commissioner for Health, Professor Princewill Anthony Chike; SPDC’s General Manager External Relations, Igo Weli; and the company’s Regional Community Health Manager, Dr. Akin Fajola.

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INDUSTRY NEWS

Newly-Recruited NNPC Graduate Trainees Assume Duties Remotely and reduced number of people in the workplace. Mr. Obateru said the trainees had completed online documentation, and would commence virtual on boarding as required. He also relayed the message of the Managing Director of the corporation, Mele Kyari, who expressed delight about the assumption of duty of the new intakes while noting that they were part of the succession plan to assure the future of NNPC.

ore than 1,000 graduate trainees recently recruited by the Nigerian National Petroleum Corporation (NNPC) have assumed virtual duty from 4th of May, 2020. This is in compliance with a statement released by the corporation on Thursday the 30th of April 2020. According to the letter signed by the Group General Manager, Group Public Affairs Division, Kennie Obateru, “The trainees are to assume duty first, virtually, while the corporation monitors the Covid -19 situation and the Federal Government’s directives to determine a date of physical assumption of duty,”.

Mr. Kyari also congratulated the successful graduate trainees, adding that much was expected of them. Kennie Obateru stated further that the assumption of duty of the graduate trainees marked the successful completion of the 2019/2020 recruitment noting that in pursuance of excellence, NNPC as an equal opportunity employer with business interests across the Oil & Gas Industry value chain would continue to recruit the best hands in order to buoy its operations nationwide.

Virtual assumption of duty became necessary due the need to comply with extant protocol on social distancing

LEKOIL Gets A Breather on $7.6Million It Has to Pay to Optimum

AIM Listed LEKOIL says it reached an agreement with Optimum Petroleum Development Company, the Operator of the Oil Prospecting Lease (OPL 310), on deferring the final tranche of payment of $7.6Million due on or before 2 May 2020. The companies had earlier jointly decided that final payment of $9.6Million, in aggregate, would be made to Optimum to cover sunk costs and consent fees for

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LEKOIL’s 17% farmed in interest. This final payment was to be made in two tranches with the first payment of $2Million completed as announced on 3 April 2020. Now Optimum and LEKOIL have agreed on a deferred payment schedule as follows: the sum of $1.0Million to be paid on or before 15 July 2020; the sum of $2Million to be paid on or before 2 September 2020, and the sum of $4.6Million to be paid on or before 2 November 2020. OPL 310, located in 100 to 200metre water depth in the Benin Basin, offshore Lagos, Nigeria, contains the Ogo field. The field was discovered in 2013, with LEKOIL and (then partner) Afren, now defunct, describing it a significant discovery and claiming estimates of P50 recoverable resources of 774 Million Barrels of Oil Equivalent (MMBBOE) a figure which far exceeds the expected pre-drill estimate of 202MMBOE.

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INDUSTRY NEWS

NLNG Commits N1bn to Covid-19 Fight in Rivers.

he Nigeria Liquefied Natural Gas (NLNG) Limited said it has committed N1 billion in various interventions in Rivers State in collaboration with relevant stakeholders to contain the spread of COVID-19 in the state, particularly in its operational base, Bonny Island currently with no confirmed case of infection).

the spread of the disease was in line with its obligation to staff and social responsibility to stakeholders, host communities and Nigeria as a whole.

The NLNG added that on the national level, it also contributed to the over US$30 million financial support given to the federal government through the Oil and Gas Industry Collaborative initiative spearheaded by the Nigerian National Petroleum Corporation (NNPC) to fight the virus. The company restated its support for the fight against the pandemic and urged resilience and adherence to social distancing rules and other precautionary measures advised by the health authorities, in order to control the spread of the disease in the country. NLNG in a statement signed by its General Manager, External Relations and Sustainable Development, Mrs Eyono Fatayi-Williams, pointed out that it takes the health and safety of its stakeholders very seriously, adding that the measures it proactively put in place to prevent

The NLNG alsi disclosed that it has in addition donated equipment and Personal Protective Equipment which include five suction machines, three single air conditioners for consulting rooms, five split air conditioners for wards and 10 patient monitors. Other items it donated for use on Bonny Island included one oxygen bank consisting of five bull nose cylinders, 10 drip stands, 10,000 one-fit N95 health care particulate respirator and surgical masks, 250,000 surgical masks, 50,000 nitrile gloves, 12,500 hooded coveralls with boots, 70 respirators, and wall mounted hand sanitizers.

The company revealed that it has committed to the refurbishment of a building and setting-up of a 10bed Isolation/Holding Centre at the Bonny Zonal Hospital.

protect all those who live on, or visit the Island. NLNG also said it is donating equipment and materials to upgrade specific facilities at the Rivers State University Teaching Hospital (RSUTH). The company also donated items to the government which includes two transport vehicles for contact tracing, five ventilators, 30 patient monitors as well as over 100,000 surgical masks. Other items donated by the company include 30,000 nitrile gloves, 5,000 hooded coveralls, 8,000 respirators, 200 goggles and 200 face masks. It said it would continue to support the government through its membership of an advisory team constituted by the state ministry of health to guard against the spread of the disease. The company stated that to help palliate hardship resulting from the stay-at-home order in Rivers State, it has donated food items to its host communities, stressing that its contribution to the fight against the pandemic was in line with its vision of, â&#x20AC;&#x153;helping to build a better Nigeria.â&#x20AC;?

The company maintained that it is also partnering with a committee set up by the Bonny Local Government Council to develop and implement a strategic plan to

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INDUSTRY NEWS

OGTAN Webinar: Wabote Bemoans Impact of Covid-19 on Oil, Gas Industry Trainings

he Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB) has advised companies handling trainings in the Nigerian oil and gas industry to reposition themselves. Mr Simbi Wabote, the Executive Secretary, NCDMB, gave the advice while speaking recently at a webinar. Wabote urged the companies to redesign their training modules in order to overcome the challenges created by the coronavirus pandemic and crash of crude oil price. According to him, the webinar, organised by the Oil and Gas Trainers Association of Nigeria (OGTAN) had the theme: “Challenges, Opportunities and New Realities for O&G Trainers’’. Wabote warned that the twin challenge of COVID-19 pandemic and low price of crude oil might remain for a considerable time. He noted that oil and gas training would be negatively impacted because most face to face programmes would no longer hold and there would be delayed learning interventions, loss of businesses, revenue and jobs.

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The executive secretary said that most oil and gas trainings would likely take place in virtual classrooms and would require virtual machines, simulators and dongles. He added that such trainings would demand high cost of set up but the operational cost would be lower over time and learning costs would become cheaper. Wabote said that virtual learning models might lead to lower assimilation by the trainees and reduced profits for the companies at the onset. He listed critical requirements for oil and gas training in this regime to include, expanded spaces for ongoing trainings, reduced number of students per classroom, increased cost of instructors, face masks, hand sanitisers, hand gloves, soaps and water. Wabote identified the negative impact of the prevailing circumstance on OGTAN members to include stoppage and cancellation of training programmes, delay in payments, reduction in the number or trainees and higher cost of administering programmes.

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Other effects may include, abandonment of physical classrooms in spite of huge investments already

made, need for new capitalisation to acquire infrastructure, absence of high speed internet and need for retraining of faculties,” he said. He also warned that there would be shortage of training opportunities because the oil industry was suffering from no new projects and crash in oil price, hence no funding for trainings, competitive rivalry and lack of certainty in training opportunities. Wabote said the new regime of virtual training would attract new and global competitors, some with advanced technologies. He advised local players to explore collaborations, international accreditations, quality, cost and differentiation. For ongoing trainings, the executive secretary advised OGTAN members to implement COVID-19 safety measures, redesign time table and number of trainees per class, provide Personal Protective Equipment (PPE) and redesign On-the-Job Trainings (OJT) and laboratory events. He said: “For medium term plans, training firms are to redesign hands-on classes and leverage technology,

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INDUSTRY NEWS

move majority of theoretical trainings online, retrain faculties for virtual training and provide infrastructure.

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Other strategies are to expand the market place, advertise online, get international students and include trainings required in the other sectors of the economy in their offerings.’’

Wabote also recommended that training companies should consider partnerships, consider jointly establishing a global virtual university with hubs around the world and mergers and acquisition of smaller players.

funding for the acquisition of training technology. According to him, a special e-learning centre will be established in the Board’s Specialised Centre in Yenagoa, Bayelsa and a new trainees’ handbook and new Human Capacity Development Guideline will be launched.

He said that on NCDMB’s part, the board would provide tablets or laptops in future virtual trainings and would consider a special

Nigeria Has No Shut-in Oil Production -Kyari

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We have to cut down, whether with or without OPEC output cut deal. We have to reduce our oil production level because we do not have where to take the oil to, till the situation improves. The impact of the crisis is global and not on Nigeria alone,” he said.

roup Managing Director of the Nigerian National Petroleum Corporation, NNPC, Mele Kyari, has debunked reports that Nigeria has shut in its oil production as a result of the current market situation. He made the clarification in an interview with Premium Times on Tuesday. According to him, Nigeria achieved the highest oil production capacity it has not in the last two to three days, with the country approaching about 2.44 million barrels per day.

He said the OPEC+ output cut would take effect in May and June. At its last meeting a fortnight ago, OPEC and its allies agreed to cut a total of about ten million barrels of crude oil per day, with about eight million barrels per day in the first phase of the implementation of the deal. Nevertheless, he said the country has to scale down the production, considering that ultimately it has nowhere to take the oil to during this period of coronavirus pandemic.

On the slump in the U.S. crude oil which crashed futures below $0 per barrel, he said is not a reflection of the reality in the global oil market capable of impacting Nigeria’s oil production. On Monday, the U.S. crude oil price dropped to its worst level since New York Mercantile Exchange, NYMEX opened oil futures trading in 1983. The drop came few days after Nigeria’s benchmark crude oil grade, Bonny Light, slumped to an average $12$13 per barrel. Despite the recent intervention by the Organization of Petroleum Exporting Countries, OPEC and its allies, led by Russian, to cut global crude oil, no significant improvement has emerged in the oil market. With crude oil prices on a downward swing, market analysts say the record output cuts by OPEC+ expected to take effect from May 1 needs some time to rebalance the market. But, the GMD said Nigeria has no cause to be apprehensive over US negative oil price.

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INDUSTRY NEWS

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FG Spent N752 Billion on Subsidy-NNPC

That is not real crude oil price. That is the traders’ paper figure just showing the detail at the close of their business for the month. You would have observed that it has changed this morning (Tuesday). This is because they are not sure of the storage facilities for their stock of products they have,” the NNPC boss said. He said the situation, which reflects the current position in the U.S market, does not have any direct impact on the price of the Brent crude oil blend, which rose to about $28 per barrel before dropping to the current price of to $26.24 a barrel on Tuesday.

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Usually, the spread between OPEC price and the other prices vary by about $8 to $9. When that is deducted from the prevailing price, we have the real price in the market. But, today, Brent is about $28 per barrel. If $8 or $9 is deducted, we will know what the real price is today.“ But, it’s really nothing for us (Nigeria) to worry about at all. Like I said the other day, the market will still change and rebound after the OPEC output cut. We will have to wait and see what is going to happen. It is just the close of the market month,” he said. On whether the current situation has any impact on Nigeria’s oil production, he said that is a different issue, pointing out that oil production is usually a factor of the availability of the market for the product. He said now that there is a drastic drop in the price of crude oil at the internal oil market, there is the problem of storage facilities, which is why traders have taken that position to show inactivity. However, as soon as most countries return to the market by May after the lockdown period, as a result of the impact of the Coronavirus on the global economy, Mr Kyari said storage facilities would become available, and of course, crude oil price will rebound.

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he Nigerian National Petroleum Corporation (NNPC) has said that the Federal Government spent N752 billion on petrol subsidy in 2019, According to NNPC’s operations and financial activities for January 202 the government through the Corporation spent the sum of N594,525,670,942 as subsidy payments captured as under-recovery in its financial statement for January 2019 and January 2020. The repor t stated fur ther that Nigeria imported 21,832,380,171.73 litres of petrol through its Direct Sales Direct Purchase (DSDP) swap programme between January 2019 and January 2020. The report also showed that apart from the expenses, the country also lost about N28,396,312,295 to stolen or lost products within the period; adding that N132,143,966,247 was spent on pipeline repairs and management costs, as well as N3,460,993,736 calculated as

the financial value of the volumes of crude oil that were lost.igeria resorted to importation of refined petroleum products for its domestic use as the country’s three refineries largely remained dilapidated, incurred a total of N158.6 billion as losses within the same period. Both subsidy claims and refineries deficits amounted to circa N752 billion. Specifically, the NNPC noted that in January 2019, the country spent N40,532,561,017 on petrol subsidy; N2,875,580,922 in February; N13,335,581,366 in March; N104,347,173,012 in April; and N102,338,409,727 in May. It further spent N30,637,245,949 in June on petrol subsidy; N9 3 , 691 , 8 61 ,719 in J ul y ; N42,926,632,833 in August; N31,405,120,306 in September; N29,312,835,072 in October; N33,187,554,072 in November; N26,628,940,202 in December and then incurred N43,306,174,744 in January 2020. The figures according to the corporation are reported in arrears.

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INDUSTRY NEWS Similarly, it stated that the consolidated performance of the refineries showed that they lost N8,362.02 billion; N10,259.27 billion; N16 ,036 .17 billion; N11,439.86 billion; N13,629.28 billion; and N17,420.47 billion in the first six months of the year which were January, February, March, April, May, and June respectively.

The refineries further failed to earn N13,836.04 billion in July; N13,209.08 billion in August; N7,074.31 billion in September; N11,716.56 billion in October; N12,517.09 billion in November; N13,457.59 billion in December of 2019 and then N9,601.49 billion in January of 2020, with all the figures recorded in arrears.

The refineries, the NNPC report stated were largely inoperative in 2019 with their capacity utilisation remaining at zero most of the time except for January, February, March, May and June when they operated at various low percentage levels of 5.55 per cent; 13.18 per cent; 3.17 per cent; 1.75 per cent and 2.14 per cent

Smart Policy Options will Safeguard Nigeria’s Economy from Covid-19 Shocks - NNRC

Ajumogobia

h e Nigerian Natural Resources Charter (NNRC) has urged the Nigerian government to act quickly on a number of reform items, long on the drawing board, if the country “is to minimize the effects of the inevitable recession contributed by falling oil prices, depreciating revenues, and rising debt ratio,” that are aggravated by the rampaging global pandemic known as the Novel Coronavirus Disease 2019 (COVID-19 for short). Drawing on the benchmarks and the gaps identified in its recently

published 2019 Benchmarking Exercise Report (BER), the Charter acknowledges the government’s recent steps; “to deregulate the downstream sector, re-open bid rounds of marginal fields, cut the 2020 budget, contemplate privatization of the refineries and others”. But “to optimize the opportunities from oil and gas exploitation to withstand the prevailing COVID-19 shocks and its after effects”, the Charter urges, “Nigeria must consider the following policy options to stabilize the sector, maintain revenue flows, attract investment and drive

growth: * Maintain peace and stability in the Niger Delta to sustain revenue flows from oil production. Sustaining benefit transfer schemes by NDDC, MNDA and other interventions will support the government’s stabilization efforts; * Improve coordination between federal and Niger Delta state governments on the response to the COVID-19 pandemic including the design and implementation of stimulus plans;

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INDUSTRY NEWS * Liberalize the downstream sector to allow market forces determine pump prices for petroleum and other products. This will ensure the availability of revenues necessary for more critical areas of the economy; * Improve the efficiency of the downstream oil sector by reviewing its policies, regulations and operational guidelines to ensure profitability, improved private sector participation and improved employment; * Adopt and constitutionalize a savings mechanism with clear and transparent operational rules. This could be by retaining the more effective sovereign wealth fund (SWF) in the NSIA and transferring funds from the Excess Crude Account, the stabilization fund and other similar funds to the SWF. This will help fortify the Nigerian economy from oil price volatilities and other economic shocks. Ramping and prioritizing domestic gas-based industrialization projects, to diversify Nigeria’s energy supply, increase local employment and reduce domestic demand and Nigeria’s reliance on oil; * Support a major and urgent shift to gas in terms of investment focus. Gas supply to domestic market for power, industrial & manufacturing feedstock and enabler to economic development. Emphatic shift to

the gas value chain offers Nigeria the leverage for socio-economic development in the medium to long term;

* Sell off unviable government owned oil assets to raise revenue and boost efficiency in the short to medium term.

* Fast-track the passage of the petroleum industry bill to bring about the fiscal, governance and regulatory clarity required to monetize Nigeria’s 200 Trillion cubic feet of gas reserves. Speedy passage of the Petroleum Industry Bill will provide a clearer strategic direction to the entire industry, reengender trust, thereby increasing investments which will in turn increase national revenues required for development;

“Adopting these reforms will improve Nigeria’s competitiveness, revenue inflows and improve her ability to survive and subsequently recover from the effects of COVID-19 on the global economy”, the NNRC explains, asking that the government be consultative in its approach to reforms, transparent and inclusive to increase likelihood of acceptance and implementation.

* Review the existing fiscal framework to ensure competitiveness and support Nigeria’s ability to attract investments into the upstream sector, effectively shoring up Nigeria’s diminished reserves; * Institutionalize cost management strategies within the sector with the overall objective of reducing the high unit production cost of crude thereby improving governments revenue from the sector;

“Prioritizing these reforms are necessary while Nigeria considers other medium to long term reform plans simultaneously. The NNRC’s 2019 Benchmarking Exercise Report (BER) outlines other sector gaps to be focused on in the medium to long term to improve Nigeria’s oil sector performance. These can be found on the NNRC website on www. nigerianrc.org/2019-benchmarkingexercise-report.”

* Immediately privatize refineries as stated by NNPC to improve Nigeria’s access to finished products in country, reducing potential for over reliance on external support for products, to preserve Nigeria’s sovereignty; and

Sahara Energy Chief Calls for Greater Resilience in Global Energy Market

he Chief Operating Officer (COO) of Sahara Energy Resources DMCC, Dubai, Mr. Andrew Laven, has said that stakeholders in the global energy market need to work more collaboratively to shore up the market’s resilience in the face of the economic and supply chain disruption caused by the Covid-19 pandemic. Laven, in a statement by the Head, Corporate Communications, Sahara Group Limited, Mr Bethel Obioma, explored some of the key lessons from the pandemic for the energy market in an article for leading trade publication Energy Voice, titled: ‘Finding the new norms in the post-COVID supply chain’.

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INDUSTRY NEWS The statement quoted Laven as saying: “The path to recovery is likely to be bumpy and everywhere will be moving at a different pace, so more of a wide U-shape than a quick V. Whatever the path, oil will be a critical element of the recovery. Even though there is not much we can do to stimulate demand, the sector must prepare for recovery: positioning all aspects of the value chain to supply energy to countries, communities and individuals.” The market, Laven said in the statement, needs to brace up for a shift in consumption, following the disruptions caused by the pandemic. According to him, “A shift in consumption for example more driving, less flying will see demand for products change. Refineries may need to change the way they operate and produce different proportions of each fuel, which may see some refineries unable to operate economically and being forced to close. Where things change, though, there are also opportunities for new energies when demand starts to pick up maybe the world will use it as an opportunity to take a step towards cleaner energies.” Laven argued that given experiences from previous market disruptions, he was certain that the market would “bounce back”, especially when all stakeholders work together to achieve the “greater good” for all. “The oil market is exceptionally robust and will bounce back, but it would be a mistake to miss this opportunity to learn from the current challenges and build greater resilience in our supply chains for the future. In this area, we are happy to lead by example.

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Resilience has always been a part of Sahara Group’s approach across the African continent, building a business that learns from the market conditions in order to adapt to and meet current requirements and changing circumstances,” he added. Laven’s Sahara Energy Resources DMCC, Dubai is an affiliate of energy conglomerate Sahara Group which has operations in Africa, Asia, Europe and the Middle East.

Eni Invests 33.4 Million Euros in Human Capacity Development in 2019 By Ikenna Omeje Eni, the owner of the subsidiary, Nigeria Agip Oil Company (NAOC), invested 33.4 million euros in human capacity development of its workforce in 2019. The company disclosed this in a release sent to Majorwaves on Wednesday, on its 2019 sustainability report titled,” Eni for --- A just transition 2019”. The company said that during the year under review, it increased training hours for its workforce by 16.5 percent, which started since 2018, noting the important role developing the skills of its workforce can play in the company’s transformation agenda.

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Eni’s operational excellence model demonstrates its continued commitment to valorizing its people, protecting the health and safety of employees and environment. The skills of Eni’s people play a key role within the company’s transformation, and to this end Eni invested 33.4 million euros in training activities in 2019, increasing training hours by 16.5% since 2018. Operational excellence also means running our business with the utmost attention

to integrity, respecting and promoting human rights and always operating with transparency,” the company state According to the statement, decarbonization is key to the the company’s energy transition, and in this regard, its strategy is targeted at reaching net zero scpoe 1 and scope 2 greenhouse gas emissions by 2040, which will be followed by lifecycle greenhouse emissions reduction of energy products sold by 80 percent. The statement said,”Eni’s commitment to progressive decarbonization is central to its energy transition roadmap, which entails a significant reduction in the carbon footprint related to the business portfolio. The new Eni’s Strategy aims at reaching net zero scope 1 and scope 2 greenhouse gas emissions by 2040, and reducing net lifecycle greenhouse gas emissions of energy products sold (inclusive of scope 1, scope 2 and scope 3) by 80% in 2050 vs 2018, a target which exceeds the 70% threshold reduction foreseen by the International Energy Agency in the Sustainable Development Scenario.”

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INDUSTRY NEWS Speaking on the report, the Chief Executive Officer of the company, Claudio D esc alzi, said“The historical moment we are going through poses complex challenges on our path, but we’re certain that these difficulties will lead to new opportunities for Eni. The commitments we have taken to pursue in our transformation process as a business are now even stronger, as well as our determination to fight climate change and our efforts towards a just energy transition that

takes into account all the factors at stake: from the need to reduce our carbon footprint in the direction of the Paris Agreement to the need for a global development of mankind.” Highlight of the report revealed that the intensity of greenhouse gas emissions in the upstream operations of the company, fell by 27 percent since 2014, which is in line with the goal for 2025, that sets a reduction of 43 percent compared to 2014. Also,

the fugitive emissions of methane fell by 44 percent since 2018. This is a target of an 80 percent reduction compared to 2014 six years early than forecasted. The report further highlighted that a total of 25,845 hours of training on human rights, to create a shared language and culture of upholding human rights and improve understanding of its potential impact on the company’s business, was invested.

PPPRA, PEF, PTDF Constitute Administrative Overburden to the Petroleum Sector - Expert By Ikenna Omeje with no significant value added to the economy. Yet, the compensations in these agencies of the Ministr y of Petroleum are significantly higher than those of the staff of the ministry and are comparable to NNPC structure. This is prebendalism at work!,” he said.

professor of Petroleum Economics and Policy Research and former president of the United States Association for Energy Economics (USAEE), Mr Wumi Iledare, has said that Petroleum Products Pricing and Regulatory A genc y (PPPR A), Petroleum Equalization Fund (PEF) and Petroleum Technology Development Fund (PTDF ) constitute administrative overburden to Nigeria’s petroleum sector.

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They constitute administrative overburden to the petroleum sector. When last did you see an advert for employment into these agencies? Yet the employees are hired, even if temporarily hired, Why? The reason is obvious, juicy agencies

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Oronsaye report, a 660-page report, had recommended a reduction in the number of government agencies and parastatals by consolidating some and the outright scrapping of about 102 of such organisations. But reacting to the planned implementation of the report by the Federal Government said to happen in October this year, Iledare called on President Muhammadu Buhari to go beyond “just adopting Oronsaye’s report on rationalising, merging or eliminating agencies”, and use “more competent hands irrespective of political persuasion, or personal allegiance than before.” Iledare stated this in an interview with The Guardian while speaking on the impacts of COVID-19 on the country’s oil industry.

Speaking on the current weak price of oil in the international market, he said it will continue until inventory decreases. And admonished the Federal Government to revise its budget in line with the current market realities, prioritize spending on economic stimulation and borrow locally to stimulate the economy. He said, “In the shut run, yes price will continue to fall until it begins to rise when inventory is depleted or nearly so. But that depends on whether OPEC+ reduces production dramatically. “There is nothing the government can do, but to revise its budget and prioritise actual spending to stimulate the economy. I may actually suggest revisiting salary structure of some agencies and trimming down employment in wasteful areas. The Federal Government may also take another look at unsustainable budget items, and bloated overhead. It will take several months to reach the budget price of 57 dollars per barrel in a sustained manner.

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The Federal Government whose revenue is highly dependent on oil revenue is in a dire situation. Perhaps, one can suggest to it to borrow money locally to fund economic stimulation. I would, therefore, advise the government to avoid foreign borrowings because our foreign debt is already beyond manageable level.”

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LOCAL CONTENT As part of the long term solution to the economic challenges the country is facing because of its over reliance on crude oil, he said that petrol subsidy is unsustainable, noting that the payment of subsidy by the Nigeria National Petroleum Corporation (NNPC) has impacted the national company’s commerciality to meet up with government’s “economic populism”.

Train 7: NCDMB Approves Key Documents, Clears Project for Take off

“In the long run, the government needs to be less dependent on using the price of oil to define its budget, especially the concurrent expenditures. In the short-run, the government may also need to address the petroleum pricing issues.

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Petroleum products subsidy constitutes a major problem rocking our economy because of its unsustainability, and the amounts paid out over the years have never being budgeted. Hence the NNPC has had to absorb significant losses, which has impacted the commerciality of the corporation to meet up with government’s social obligations and economic populism,” Iledare said. For the country to redeem time lost in order to avoid a post-COVID-19 energy and economic crisis, he said that Nigeria needs to deploy skilled professionals in ministries, agencies and private firms, adding that all irrational models in appointments must be avoided. He said,

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The energy sector cannot deliver effectively to fuel Nigeria’s economy without using skilful professionals in the ministries, agencies and private firms. You don’t even need to hire new skills, per se, because Nigeria has competent skills in place. Yes the 20/80 rule can apply. Assign your best devoid of the illegal geopolitical structure that the country has been using as a cover in recent times.”

he Nigerian Content Development and Monitoring Board (NCDMB) has approved the Nigerian Content Compliance Certificate (NCCC) and Approved Vendors Lists (AVLs) for the Nigeria LNG Train 7 Project. The approval gives NLNG the final clearance to award the project to Saipem, Chiyoda, Daewoo Consortium and commence the execution, having previously signed the Letter Of Intent (LOI) in September 2019, after the consortium emerged the commercially preferred bidder, with technical capability to deliver on the project. The approval was conveyed in a recent letter by the Executive Secretary of NCDMB, Engr. Simbi Kesiye Wabote to the Managing Director of NLNG, Mr. Tony Attah, titled “Re: Re-NLNG Train 7 Project-Provision of Engineering Procurement and Construction For Train 7 (T7) Project- Submission of Revised NCCC’s and AVLs. The NCCC is a key Nigerian Content implementation document that spells out the detailed scopes on an oil and gas project, agreed Nigerian Content commitments and delivery strategy. The AVLs on the other hand contains all the likely Nigerian vendors, foreign vendors and community vendors for each scope of work. The vendors will still go through another prequalification process before commercial quotations will be received from them. The Executive Secretary further

directed that “NLNG should note that any scope of work not provided in the approved NCCCs, AVLs and Nigerian Content Plan, but surfaces in the project execution shall be considered Nigerian Content scope of work to be executed by Nigerian resources.“ The Board reviewed the Train 7 documents and granted necessary approvals with dispatch, notwithstanding the constraints of the COVID19 pandemic. The maximum review circle was 2-3 work days. Since the COVID 19 outbreak and lockdown in Nigeria, NCDMB has also ensured that critical services and operations of the Board continued unabated. In particular, the Board rolled out measures to ensure resilience and business continuity in the oil and gas industry. It offered business advisory to Project 100 companies and other oil and gas service companies in Nigeria on how to navigate through these precarious times and remain resilient. NCDMB also rolled out palliatives for beneficiaries of loans under the Nigerian Content Intervention (NCI) Fund. The palliatives include a huge reduction of the interest rate (from 8 to 6 percent per annum), extension of moratorium and tenor extension. These palliatives take effect from April 01, 2020. The Board also directed NLNG to give priority to Project 100 companies with proven capacities in the Train 7 project. The Board also donated ambulances and medical equipment to some states in support of the fight against COVID19.

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LOCAL CONTENT

Covid 19: NCDMB Cuts Interest Rate on NCI Fund Loans, Extends Tenor

n a d d i t i o n to e a r li e r measures by the Nigerian Content Development and Monitoring Board (NCDMB) to spur business continuity, particularly in the oil and gas sector, NCDMB has again rolled out fresh palliatives for beneficiaries of loans under the Nigerian Content Intervention (NCI) Fund. The palliatives include a huge reduction of the interest rate (from 8 to 6 percent per annum), extension of moratorium and tenor extension. These palliatives take effect from April 01, 2020. The Executive Secretar y of NCDMB, Engr. Simbi Wabote explained that these palliatives seek to reinforce the various economic stimulus packages by the Federal Government to support businesses to overcome the difficulties created by the coronavirus outbreak in Nigeria. He reaffirmed the Board’s commitment to continue to provide impetus to businesses in the oil and gas industry to surmount emerging operating difficulties in line with the Federal Government’s policy direction. Under this palliative regime, all

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running loans with outstanding tenor within 3 years will be extended by 6 months, while all running loan facilities with a tenor above 3 years will get extra 12 months tenor. Similarly, there will be moratorium extension on all running loan facilities under manufacturing, asset acquisition and contrac t finance with outstanding tenor not exceeding 3 years by 6 months and by 12 months for all applicable running loan facilities, effective April 01, 2020 . The five loan products under the NCI Fund are manufacturing, asset acquisition, contract finance, loan refinancing and community contractor financing. However, there have been no disbursements yet under Community Contractor Financing to date. The Board also confirmed that about 91 percent of the US$200m NCI Fund had been disbursed to 26 beneficiaries and many of the borrowers have started repaying. It indicated that the current success rate of the Intervention Fund is above 95 percent. Since the COVID 19 outbreak and lockdown in Nigeria, NCDMB has continued to roll out measures to ensure

resilience and business continuity in the oil and gas industry. Just last week, the Board offered business advisory to Project 100 companies and other oil and gas service companies in Nigeria on how to navigate through these precarious times and remain resilient. The Board also directed NLNG to give priority to Project 100 companies with proven capacities in the Train 7 project. Much more than these, despite the lockdown, NCDMB also wrote to NLNG granting final clearance on Nigerian Content requirements and for the Train 7 contract to be signed and project to commence. Even on the fight against COVID19, the Board also donated ambulances and medical equipment to some states.

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LOCAL CONTENT NCDMB: Executive Secretary Congratulates Staff on the 10th Year Anniversary

Rungas, NCDMB Hold Inaugural Board Meeting

he Executive Secretary o f t h e N i g e r ia n Content Development and Monitoring Board (NCDMB), Engr. Simbi Kesiye Wabote has felicitated with management and staff of the Board and the entire oil and gas industry on the 10 years anniversary of the enactment of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act. The Executive Secretary conveyed his compliments on Wednesday during the virtual town hall meeting he held with staff of the Board to mark the anniversary. About 90 percent of the Board’s staff participated in the meeting from different cities across the country. T h e Nigeria n O il a n d Gas In dus tr y Co ntent Development (NOGICD) Bill was signed into law on April 22, 2010 and it gave birth to the NCDMB. Wabote explained that the Board had elaborate plan to celebrate the momentous achievements recorded over the first decade, but had to postpone it alongside other scheduled programmes because of the coronavirus pandemic and escalating effects across the country and the globe.

He noted that the restriction in movement in most parts of the country has necessitated the adoption of virtual work mode by the Board to ensure business continuity. He charged every staff of the Board to start adjusting to this new reality because post-COVID-19 would entail a lot of adjustments in our way of doing business, even after a vaccine for the virus is discovered. Wabote also used the opportunity to commend President Muhamma du Buhari, members of the Presidential Task Force (PTF) on COVID-19 and all frontline medical personnel for the diligent and courageous work they are doing to contain the spread of coronavirus in Nigeria. He also hailed the visionary leadership displayed by Mr. President in banning the importation of rice and some other food items in 2019, a decision that encouraged local rice production that has helped the country to avert food crisis during this pandemic. The Executive Secretary also asserted that COVID-19 has taught Nigerians the key lesson that we must urgently pursue Local Content and self-sufficiency in every sector of our national life.

he Nigerian Content Development and Monitoring Board (NCDMB) on Thursday participated in the inaugural Board of Directors meeting of Rungas Prime Industries Limited, in furtherance of the partnership to establish a 400,000 units per day LPG (cooking gas) cylinders manufacturing plant at Polaku, Bayelsa State. The meeting was held via video conference facility in line with NCDMB’s firm commitment to ensure business continuity despite the disruptive effect of the coronavirus pandemic in the country. The Board of Directors approved elements of the business plan that will enable the commencement of the project within the constraints of the COVID-19 lockdowns. NCDMB and Rungas signed the partnership agreement in December 2019 in Yenagoa, Bayelsa State, at the Practical Nigerian Content Workshop. In January 2020, the Executive Secretary NCDMB, Engr. Simbi Wabote announced that Rungas had been allocated two hectares of land at the Board’s land at Polaku for the establishment of the factory. He also stated that Chief Timipre Sylva, Minister of State for Petroleum Resources was desirous for the project to start immediately because of his mission to drive the penetration of cooking gas to all Nigerian homes. The Executive Secretary said the project will generate up to 200 direct and indirect jobs during construction phase and about 350 direct and indirect jobs during the full operations phase, in addition to other induced employment and economic activities. The project received further boost in March when NCDMB signed an agreement with Shell Nigeria Gas (SNG) for the lease of one hectare of the Board’s land at Polaku, for the development of a Pressure Reduction and Metering Station. Shell will use the new plant to distribute part of the gas from its Gbarain-Ubie Gas Plant for domestic utilization in Bayelsa and environs. Shell’s investment will ensure that Rungas Prime and other businesses that would sprout on the Polaku corridor can easily access natural gas for power and other needs.

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LOCAL CONTENT

NCDMB Donates N70m to PTF on COVID-19 ...Pandemic an opportunity to promote Local Content-SGF

h e N ige ria n C o nte nt Development and Monitoring Board (NCDMB) on Wednesday donated N70,000,000 (Seventy Million Naira) to the Presidential Task Force (PTF) on the Coronavirus Virus (COVID-19) pandemic. The Executive Secretary NCDMB, Engr. Simbi Kesiye Wabote handed over a letter communicating the donation to Secretary to the Government of the Federation (SGF) and Chairman of the Presidential Task Force on COVID-19, Boss Mustapha in Abuja. Wabote explained that the Minister of State for Petroleum Resources, Chief Timipre Sylva, who is also the chairman of the NCDMB Governing Council is passionate about the oil and gas industryâ&#x20AC;&#x2122;s support to the fight against COVID 19. He noted that despite the Boardâ&#x20AC;&#x2122;s recent donation of ambulances and medical supplies to its host states

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of Bayelsa, Delta and Rivers, to support its response against the pandemic, the Governing Council still considered it necessary to approve additional support to the national effort. In his response, the SGF thanked the NCDMB for the donation and assured that it will be used judiciously in furtherance of the national response. He added that medical equipment and relief materials were required in all states of the country. He regretted that COVID-19 had become the biggest health challenge of our generation and every available resources will be required to contain it. Mustapha charged Nigerians to take personal responsibility and obey all the guidelines issued for the easing of the lockdown. He stressed that countries that had overcome the virus had achieved the feat through the active cooperation

of their citizens. Speaking further, the SGF hinted that the pandemic had provided the perfect opportunity for Nigerians to promote Local Content in all facets of the economy. He noted that all countries of the world were scrambling for ventilators, test kits and other medical consumables, thereby spiking the cost of the items. T h is d eve l o p m e nt h e s a i d underscored the urgency to focus on the local production of all critical items we need as a nation. He added that focusing on Local Content in key sectors of the economy will also help to stop capital flight and create much needed jobs locally. The SGF confirmed that the Central Bank of Nigeria (CBN) had begun to introduce a number of funding packages that are designed to promote medical, pharmaceutical and hospitality businesses that would depend on what we produce, manufacture and consume locally.

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LOCAL CONTENT

NCDMB to Spur O&G Innovation with BrentPlus

he Nigerian Content D evel o p m e nt a n d M onitoring B oard (NCDMB) on Friday launched BrentPlus, a series of initiatives that will stimulate innovations in the oil and gas industry and ancillary sectors and create a platform for local creation of digital technologies. The Executive Secretary of NCDMB, Engr. Simbi Kesiye Wabote unveiled BrentPlus during a webinar titled “Innovating for the future of Nigeria’s Oil & Gas Industry and its Linkage Sectors.” He added that one of the strategic initiatives under the Nigerian Content 10-year roadmap is to promote the development of innovative in-country solutions in the oil and gas industry. The webinar was the first by the Board since the outbreak of the Coronavirus pandemic and according to Wabote, it will form part of the new channels and technologies NCDMB will be using henceforth to engage stakeholders of the oil and gas

industry. He listed the processes of BrentPlus to include Problems Definition, Call for Innovation, Nigerian Oil and Gas Technology Hackathon, Incubation and Scale-Up. Providing details of the Problems Definition stage, the Executive Secretary said the Board will administer surveys to focus groups and stakeholders to understand the biggest challenges facing the sector. He promised that the Board will soon hold a Webinar to get feedback on the opportunities for digital innovation.

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The problems must not be related to the oil and gas sector. It can be daily life problems,” he clarified.

Subsequently, NCDMB will pick out the biggest challenges and call for innovations from interested teams with ideas, prototypes, solutions and relevant experiences, after which, the applications will be reviewed

by judges and shortlisted, with a few selected. He stated that the third stage of the BrentPlus process will be a Hackathon- a three-day residential camp where “participating teams will meet with industry stakeholders and further understand the challenges. Teams will revalidate their solutions and pitch at the end of bootcamp. Five winning teams will be selected.” Wabote explained fur ther that Hackathon enables crowd sourcing of digital innovations that will solve challenges. The idea is to provide a platform for individuals to get together for a short period of time to collaborate on a project, he added. He hinted that during the incubation, which is the fourth stage of the process, ”five winning teams will get $10,000 equity-free grant each. They will also get work-space, expert mentors, global partners and unprecedented market access over three-months, ensuring they become commercial and investorready.”

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LOCAL CONTENT He added that “at the end of the incubation, the teams will participate in a showcase day to demonstrate their progress. This showcase will aim to connect them with investors and industry stakeholders where they can further amplify their market access.” Specifying the criteria for eligibility, the Executive Secretary said participants ”must be a team/ company of at least two or more members with at least 75 percent of the founding team as Nigerians. The team/company must be a registered, or intending to register as a profit/business entity. The solution described in response to the challenge must be driven by digital technologySoftware, Hardware or both.” Other conditions include that “the solution must either be at idea stage, prototype level or a launched solution that hasn’t gained commercial traction. The team

must be available to participate in a three-day hackathon as well as a three-month incubation, if selected.” The NCDMB boss solicited for industry’s collaboration and support in helping to understand most pressing challenges and provide datasets that can be useful for the innovators. He also called for mentors who will help and guide the teams at the stages of Hackathon and Incubation and serve as advisors to incubated teams. He also sought for partners who will provide additional incentives for participating teams to make the project bigger as well as host and showcase participating teams at their events. Lastly, he requested industry assistance in facilitating access to market, particularly to operational facilities for rapid product validation and participation in demos and potential to invest in

promising start-ups. Responding to a question from the audience, the Executive Secretary assured that prototypes from the programme will not be abandoned. “We will see it end to end and put in place plans for continuity,” he promised. On concerns that the introduction of more sophisticated technology by the oil industry could lead to job losses, he insisted that technological advancements had always created more jobs opportunities around the world, especially for persons who are willing to innovate and acquire relevant skills. He said the outbreak of COVID19 had made it imperative for organisations and individuals to adopt technology and innovation to stay afloat. He also charged Nigerians to promote innovation and adapt to cutting edge technology that will help in solving the problems we face in different facets of the society.

NLNG signs EPC Contracts with SCD JV Consortium

igeria LNG Limited (NLNG) has signed the Engineering, Procurement and Construction (EPC) Contracts for its Train 7 Project with the SCD JV Consortium, comprising affiliates of Saipem, Chiyoda and Daewoo.

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The execution of the EPC Contractsnow triggers the commencement of the Detail Design and Construction phase of the Project expected to increase the capacity of NLNG’s current six-train plant by 35% from the extant 22 Million Tonnes Per Annum (MTPA) to 30 MTPA.

N L N G is a n in c o r p o r a te d Joint-Venture owned by four Shareholders, namely, the Federal Government of Nigeria, represented by Nigerian National Petroleum Corporation (49%), Shell Gas B.V. (25.6%), Total GazElectricite Holdings France (15%), and Eni International N.A. N.V. S.àr.l (10.4%). Reacting to the Contracts’ signing, Engr. Tony Attah, the Managing Director and Chief Executive Officer of NLNG, remarked that the EPC Contracts represents yet another milestone in NLNG’s journey towards achieving its vision of being a global LNG company, helping to build a better Nigeria. READ Oil output disruptions to erode surplus, demand may surprise – IEA He said: “With the award of the EPC Contracts to our preferred bidders (SCD JV), we are guaranteeing that our country remains significantly on the global list of LNG suppliers.

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LOCAL CONTENT This singular act clearly demonstrates our Shareholders’ determination and resolve to sustain the economic dividends that NLNG’s monetization of our vast natural gas reserves offers our great country Nigeria” He expressed confidence in SCD JV Consortium’s proven competence, adding that the demonstration of an understanding of NLNG’s business philosophy by the Consortium will positively influence the execution of the Project and ensure zero harm to people, environment and host communities. Also, the Group Managing Director (NNPC) and a Director on the NLNG Board, Mr. MeleKyari, remarked on NLNG’s successes and its operating model. He said: “Nigeria LNG’s successes since it started operation in 1999 continue to prove that the

Company operates a unique business model that is profitable to all its stakeholders. NNPC and the other Shareholders — Shell, Total and Eni — are proud to be a part of this exceptional Nigerian brand that stands out in the global market.”

every stakeholder involved in execution of the Train 7 Project, especially the SCD JV Consortium, NLNG Train 7 Project Team and the Company’s Management to leave no stone unturned in making this project a reality,” he added.

“It is for this reason that our President, Muhammadu Buhari instructed through the Honourable Minister of State for Petroleum Resources that NNPC as a Shareholder must do everything possible to support all the other Shareholders and NLNG’s Management to secure the much-needed public confidence from all critical stakeholders, especially the critical agencies of the Federal Government of Nigeria and international investors, to pursue the Company’s ambition of adding a 7th train to its existing production capacity. I encourage

NLNG says the Project was in fulfilment of its vision of “…being a Global Company, helping to build a better Nigeria.” The Project upon completion will support the Federal Government’s drive to generate more revenue from Nigeria’s proven gas reserves of about 200 Trillion Cubic Feet (Tcf) and further reduce gas flaring in the country’s upstream oil and gas industry. The construction period is expected to last approximately five years with first LNG rundown expected in 2025.

MARITIME

NIMASA Probes Dead Fishes in Niger Delta Communities

in the affected communities and those who trade in aquatic animals to avoid consumption and sale of the dead fish.

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h e Nigerian Maritim e Administration and Safety Agency has commenced a scientific inquiry into the recent shoals of dead fishes washed ashore along the Niger Delta coastline states of Akwa Ibom, Bayelsa, Cross River, Delta, Rivers and other places within the region. The agency also put up a warning to the general public, especially the locals in the affected areas, about the dangers of consuming or selling the

dead fishes to unsuspecting members of the public The Director-General of NIMASA, Dr Bashir Jamoh, said the agency was working with relevant scientific experts to isolate the cause of the abnormal issue of dead fish along the Niger Delta coastline. He said in a statement, “We want to identify the cause and establish what can be done to alleviate the adverse effect of this occurrence on the people and the marine environment in the affected areas. “While we are working to decipher and mitigate this strange incident, we appeal to locals

Also, selling of the dead fishes to members of the public will carry criminal liabilities.”

Jamoh said the investigation would involve an examination of the dead fish as well as water and sediment analyses. According to the statement, NIMASA has the mandate to regulate and protect the country’s marine environment as provided for in the Merchant Shipping Act 2007 and in compliance with the International Convention for the Prevention of Pollution from Ships, 1973, as modified by the Protocol of 1978 (MARPOL 1973/78), and other relevant instruments aimed at protecting the maritime domain.

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MARITIME

Covid-19: NIMASA Presents Ventilators, Response Vessels, Ambulance to Lagos State

he Direc tor G eneral, of Nigerian Maritime Administration and Safety Agency (NIMASA) Dr. Bashir Jamoh has presented a number of medical equipment and items including ventilators, Ambulance, buses and response vessels to Lagos state Government towards the fight against the spread of COVID 19. While presenting the items to the Governor of Lagos, Dr. Jamoh stated that the Agency felt it necessary to make the donations to Lagos as the state remains the epicentre for the virus in Nigeria. He commended Governor Babajide Sanwo-Olu for being proactive in his response to the pandemic.

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I want to commend Mr. Governor, for his exemplary leadership in the management of this pandemic, we as a regulatory Agency felt it was necessary to support the state as responsible tenants of Lagos and we hope this would go a long way in our collective effort in fighting COVID-19” Dr. Jamoh also disclosed that along with the items the Agency is also assisting the Lagos state Government with a sum of 20 million naira, adding that the donations from the Agency are not limited to Lagos alone as all geopolitical zones

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would benefit from the Agency’s humanitarian gesture.

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Our donations are not limited to Lagos alone, this is just the flag-off, we will also make donations to other states affected and as well ensure that all geopolitical zones of the country benefit; this we will continue to do as we fight against this deadly scourge”, he said. Commenting on the vessels that were made available to the state, the NIMASA DG stated that it would assist Lagos in responding to incidents in the coastal states for anchorage evacuation if need be, and that the crew on board are volunteer staff from the Agency who have been trained on manning the Fast Intervention Vessels. Dr. Jamoh also appreciated the Federal Government for its timely response to the pandemic stating that the Government has created roles for the necessary agencies to fight the scourge. He particularly commended the efforts of the National Centre for Disease Control (NCDC) in responding to infected persons as he also appealed to the media to play their roles in sensitizing the public stressing that everyone has a role to play in the fight against the pandemic.

Receiving the items on behalf of Lagos State, the Commissioner for Finance, Mr. Rabiu Olowo said the State government was overwhelmed by the goodwill and support from NIMASA.

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This is most welcomed and on behalf of the governor and the good people of Lagos State, I say thank you. As you are all aware Lagos State is the epic center of this pandemic in Nigeria. Everyone is fighting this pandemic across the globe.”

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We have seen the response of the State to this and the true leadership of Mr. Governor to fighting this. This donation will go a long way in supporting and complementing the state effort towards fighting this Pandemic,” he said. Items handed over to Lagos state Government included Ventilators, Ambulance, Fast Inter vention Vessels, Buses, oxygen concentrators, personal protective equipment, hand sanitizers. NIMASA also pledged that there were handy volunteers from the Agency and experts ready to work with the government in the use of fire engines for fumigation purposes.

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MARITIME

Covid-19: NSC Tells OPS to Decongest Ports Using Existing Incentive Windows

Relief Measures to Port Users Due to Outbreak of Covid-19 – Extension of Relief Period

he Nigerian Shippers’ Council (NSC) has advised members of the Organised Private Sector (OPS) to take advantage of the opportunities created by the various incentives which the Council has brokered with service providers at the port, to take delivery of their consignments during the period of lockdown imposed to contain the spread of Coronavirus (COVID-19) pandemic. The Council, which expressed worry over the growing number of overtime containers at the seaports, raised the alarm over looming congestion in the port where majority of the terminals are recording 95 percent yard occupancy rate due to failure of cargo owners to take delivery of their consignments. Hassan Bello, executive secretary of the NSC, made this call in Lagos on Tuesday during a meeting with members of Manufacturers Association of Nigeria (MAN), the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA), and Shippers Association of Lagos State (SALS). Bello, who emphasised on the need to diversify the economy through export and automated port system, listed some of the incentives to include reducing the cost of doing business at ports by working with truckers to reduce the transportation cost by 30 percent during the period of lockdown.

The Nigerian Por ts Authority has directed all Terminal operators to extend the suspension of all applicable terminal storage fees on consignments (demurrage) for another fourteen days effective April 13, 2020. This follows the extension of the Lockdown in response to the COVID-19 outbreak by President Muhammadu Buhari on Sunday, April 12, 2020. According to the G e n e r a l M a n a g e r, Corporate and Strategic Communications NPA, Mr. Jatto Adams, the gesture is in recognition of the pressure that the COVID-19 pandemic imposes on businesses,

the responsibilit y imposed on the Authority to relieve this burden on its customers as well as attaining the objective of the Federal Government’s Ease of Doing Business Policy at this trying period. The Authority thanked all stakeholders for their cooperation and also stated that compensation to terminal operators will be as spelt out in its April 8, 2020 letter to the terminal operators noting that it will not tolerate any form of non-compliance and defaulters will face appropriate sanctions.

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INFRASTRUCTURE

Sonatrach and Lukoil Sign MoU to Invest in Algeria

lgeria’s Sonatrach Group and Russia’s Lukoil, have signed a memorandum of understanding (MoU) to look at possibilities for the two parties to invest jointly in exploration and production operations in Algeria The deal could lead to increased production and exploration in the North African country. The MoU follows the publishing of the new Algerian hydrocarbons law at the start of the year, which revised the institutional, legal and fiscal framework of the energy sector in Algeria. The MoU also covers a review of international exploration and production opportunities. Algeria is a leading natural gas producer and one of three top oil producers in Africa.

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Nigeria Approves N11.52bn Jebba Hydropower Plant Turbine Rehab Project

he Federal Government of Nigeria has endorsed a US $32m (11.52 billion Naira) turbine rehabilitation project by Mainstream Energy Solutions Limited (MESL) at its Jebba hydropower plant in Niger State. The Minister of State, Power, Mr Goddy Jeddy-Agba made the disclosure when he received a delegation from ME SL , operators of the Kainji and Jebba hydropower plants, along with officials of Original Equipment Manufacturer (OEM) of the turbine, Andritz Hydro GmbH. The Minister also lauded the company for the turnaround experienced in the plant since it took over the operation in 2013. He assured the delegates that the Federal government was ready for more partnerships and investments as MESL was striving to improve the plants without being prompted. “I want to assure you that the Federal Government will work to make the power sector viable and move forward,” he said. The Managing Director of Mainstream Energy Solutions Limited (MESL), Eng. Lamu Audu, , in his remarks said that the Jebba Unit 2G6 turbine got burnt in

2009 under the defunct PHCN and that as part of their capacity recovery programme, they will be signing the agreement soonest to rehabilitate it as part of their mandate in the power sector privatisation. The Jebba turbine project will cost US $32m in two years and it is expected to add 96.4MW capacity to the plant. “We are sourcing for the funding through loans and again it will take about two years. The unit is supposed to come back to the grid in the second quarter of 2022.” he noted. Audu emphasised that MESL has recovered 468MW at Kainji and will be adding 80MW by October 2020 after on-going recovery works on Unit 1G7 turbine. Combined with the Jebba capacity, MESL will reach over 1,000MW capacity out of the 1,338MW total installed capacity of both plants. “By the time we recover Unit 2G6, we will almost reach our limit and we will be focusing on expansion,” he added.

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POWER

Dial it Down, NERC Orders Power Players

he Nigerian Electricity Regulatory Commission (NERC) is attempting to broker a peace deal between the Transmission Company of Nigeria (TCN) and the Abuja Electricity Distribution Company (AEDC). NERC said in a statement that there had been an “unnecessary exchange of technical opinions and blame trading” in public between the two companies. The dispute focuses on the operation of power systems and how outages are managed. Those holding licences were ordered to halt “any such public displays of indiscretion” on operations in the electricity sector. Such talk in public serves no purpose, it said, and the discussion of the “capitalisation of network utilities” was not a suitable subject for social media campaigns. As such, TCN and AEDC are to meet at NERC’s offices to discuss the matter.

The regulator warned that other distribution companies (Discos) would be scheduled for meetings to address similar issues. Once these have been completed, NERC will provide a regulatory finding to provide “general direction” to suppliers on how to protect the system. AEDC and TCN have been trading accusations following power outages on April 25. TCN kicked things off that day by saying there was a need for capitalisation of the Discos. If nothing is done to tackle this problem, it warned, “the power sector will completely collapse”. AEDC responded the following day, asking whether it was more important for the discos to be capitalised or for TCN to have expertise. Some AEDC 33kV feeders did trip on April 25, it acknowledged,

but pinned the blame for power losses predominantly to TCN. TCN has resisted the co-ordination of relays and this caused the problems, AEDC said. The company went on to describe TCN as the “weakest link in the value chain” and that the network lacked adequate protection. The dispute continued, with TCN issuing further statements. “All TCN want is for Abuja AEDC to strengthen its network and stop dropping massive load at the slightest rainfall to safeguard TCN equipment,” it said. TCN issued a statement on April 29 saying there had been a loss of supply on the national grid. The cause of the outage is being investigated.

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COVER STORY

Auctioning Marginal Fields amid Global Recession

By AMOS IKE

he novel Coronavirus (COVID-19) pandemic has battered the global economic and caused a disruption in the international financial system. This article highlights the impact of the pandemic on plans by countries to undertake marginal fields’ bid rounds; the challenges and prospects of the auctions. Economies, the world over, have been impacted by the impact of the COVID-19, and this had been worsened by the declining prices of crude oil in the international market. Though the real impact of these twin mishaps was yet to be stated and felt, it is envisaged that economies would begin to see the impact when the dust settles and

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when the world gradually begins to open for business. It has been projected that the envisaged economic gloom would affect every aspects of the economic life of a country, while the worst hit would be countries without adequate fiscal buffers. Though it appears that the oil and gas industry is the worst hit, with the dwindling prices of crude oil, low demand for crude oil and lack of facilities to store crude oil, stakeholders are unanimous in their views that the real impact of the crisis on the petroleum industry is yet to be felt. It had been stated that a number of oil and gas projects would suffer; while most oil and gas companies

are expected to cancel or cut down on their projects among others. Specifically, African Energ y Chamber had few days ago, stated that while the immediate impact on the continent’s biggest oil and gas projects is already being felt, a much bigger impact would result from the deferral or cancelling of drilling plans. According to the Chamber, already, across oil and gas basins, drilling projects are being put back on the shelves or terminated, while Final Investment Decision (FID) on Shell’s Bonga South West Aparo project in Nigeria, for which the invitation to tender was released to contractors early last year, might also not see FID this year.

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COVER STORY A major aspect of the petroleum industry that could suffer major setbacks is the planned marginal fields’ auction, as well as any attempt by African countries to conduct bid rounds for their hydrocarbon assets. It was reported that the Ministry of Petroleum Resources, had in April, gotten the approval of President Muhammadu Buhari for the fresh award of marginal field licences, however, the timeline for the auction was not stated and the number of fields to be awarded was not also stated. COVID-19 and impacts on field auction However, while the decision of the government to go ahead with the award is considered laudable, stakeholders are concerned that the current state of things in the global economy would negatively impact on the planned auction. Specifically, investors would be concerned about the state of the international crude oil and gas market, the ease of accessing funds to finance the acquisition, while the capacity of the investors to acquire and develop the fields within stipulated periods would also be a major factor. Current status of existing marginal fields

It also stated that delays in the execution or sanctioning of these projects were expected to severely impact African economies whose local goods and services were set to benefit from billions of dollars of subcontracting opportunities. It said, “Similarly, the impacts of the current crisis are wide and affecting both Africa’s most promising exploration prospects, but also its multi-billion-dollar landmark projects such as BP and Kosmos Energy’s Greater Tortue Ahmeyim (GTA) LNG project in Mauritania and Senegal or ExxonMobil and Eni’s $30bn Rovuma LNG project in Mozambique. Oil projects are suffering even more.”

The last marginal fields’ auction Nigeria conducted in 2003 had failed to achieve the desired results. The fields were awarded to indigenous investors, with majority of the awardees unable to develop them. Specifically, out of the 24 marginal fields awarded to 31 indigenous investors in 2003, according to analysts, only about 12 of the fields are operating. Going by the Department of Petroleum Resources (DPR), these producing fields are barely contributing 2.14 per cent to Nigeria’s crude oil production, as at 2018. In 2013, the Federal Government had proposed conducting another bid rounds for 31 marginal oil fields, though the award failed to see the light of day. The then Petroleum Minister, Mrs. Diezani Alison-Madueke, stated that of the 31 fields, 16 of them were located onshore, while the remaining 15 were located in the continental shelf. She had revealed that, of the

Mrs. Diezani Alison-Madueke

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24 fields that were allocated in similar exercise a decade ago, eight were already producing

while the others were at various stages of development. Alison-Madueke had noted that the marginal field operators had also recorded huge discoveries in excess of 100 million barrels to the nation’s reserve base, adding that of the eight assets that had so far been divested by the International Oil Companies (IOC), at least four were held by active marginal field operators, who had continued to demonstrate remarkable technical ability in operating significantly larger assets. Attractiveness of fields Due to the fact that they are relatively small, major players are usually not attracted to marginal fields. In some cases, the fields are relinquished by the oil majors. However, the fields offer great opportunity for smaller independent African and non-African companies. In Nigeria’s 2003 marginal fields’ bid round, the 31 companies awarded the available fields, were awarded on the basis of sole operators and others as joint-ventures. It opened a number of opportunities for local and regional industry players while it contributed, though minimally, in increasing Nigeria’s oil output.

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COVER STORY It also promoted indigenous participation in petroleum upstream activities. For companies like Oando, Waltersmith, Shoreline Energy, Seplat, Sahara Petroleum or Brittania-U, these fields represented important opportunities to farm-out some acreage from the majors and lead their own projects. However, there are a couple of lessons to be learned from Nigeria’s first marginal fields auction. According to energy experts, marginal fields are particularly attractive for smaller indigenous or regional companies that can operate well with smaller profit margins. These companies are also much more cash-strapped than the likes of ExxonMobil, Total or other IOCs, therefore need investment capital to develop their acreage. In addition, it also informs that seeking capital in the local financial sector can be challenging, especially as Nigerian banks have been resistant to awarding credit lines to operators in this kind of project due to their experience from previous exposures. Away from the regular bank practice of issuing loans against equity or assets, reserve based lending was the order until recently. Sequel to bank’s exposure, loans have been difficult and that has delayed field development. This means that inviting foreign partners with access to capital becomes paramount. Secondly, experts have pointed out the issue of legal clarity, especially as the Nigerian Petroleum Industry Bill, which in its many forms had been under discussion for over two decades, continues to create disruption and uncertainty in the industry and delaying new bidding rounds. They are of the view that

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if the current form of the bill is approved, marginal field operators are expected to receive significant cuts in taxes and royalties,

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but that remains unclear for the time being. Low profit margins From the foregoing, it is evident that marginal fields offer smaller profit margins; investors in the fields face difficulties in accessing funding, while legal clarity is crucial. All these challenges remain in the Nigerian petroleum space as well as in some other African countries. With the decline in crude oil prices, the margins available to investors in marginal fields had been further eroded, while getting markets for crude oil and gas from the assets would be a major challenge, especially with the huge supply overhang currently witnessed in the market. With the global economy facing serious financial, especially with the projection by multilateral and multinational financial institutions that the global economy would be plunged into a recession as a result of the COVID-19 pandemic, accessing funds to finance the purchase, exploration and production from these marginal oil and gas fields would be a major challenge for investors seeking to invest in these assets. In addition, the pandemic had disrupted governance, the world over, especially in Nigeria, and it is highly unlikely that Nigeria’s PIB would be passed before the end of this year. In the legal aspect again, most of the companies awarded marginal fields in the last exercise, were

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unable to commence exploration and production from the assets due to protracted legal issues.

Most of the companies instituted legal proceedings against their partners or against owners of other assets and these helped in no small measure in ensuring that the government did not achieve the

desired objectives from the assets. Furthermore, as Nigeria considers marginal fields award, mainly to boost its revenue in the wake of the global economy downturn, a number of constraints remain which might determine the success or failure of this exercise. Apart from Nigeria, with declining production and scarce investment, Angolan had put in place a number of new policies to reboot its oil industry and propel economic development, some of which included the marginal oil fields policy. The government targeted what it already knew existed, the country’s multiple deposits of what has been dubbed marginal oil fields, which was expected to go on sale last year. Experts claimed that in the Angolan deep offshore, several of these prospects had been found over the years and dismissed in the pursuit of more profitable opportunities, adding, however, that in the wake of the lack of investment in exploration in the country over the last four years, these marginal reserves have become more relevant for Angola’s macro-economic outlook.

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In May 2018, Angola’s government published a new framework specifically designed to promote investment in these areas.

According to the official text, the law considers marginal fields those discoveries with proven oil reserves of less than 300 million barrels (exceptions are considered for bigger reserves in particularly expensive working conditions), standing at or below 800 meters of water depth, that do not give returns to the state of more than US$10.5 cents per barrel, returns for the operator of no more than US$21 per barrel and that have an average return on investment after taxes of less than 15%. For those that fit these conditions, the government offers extensive tax and fiscal benefits,

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COVER STORY as well as, easier conditions for cost recovery, in order to make those reserves commercial and promote their development. Factors hindering marginal fields In his analysis of the marginal fields awards in Nigeria and across Africa, Professor Chijioke Nwaozuzu, petroleum policy expert and petroleum economist, noted that six factors had constrained the activities of marginal field operators, adding that the main factors relate to the lack of funding and the marginality of the fields. Other factors, according to him, are:

Professor Chijioke Nwaozuzu,

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inadequate technical expertise, government policies on royalties and petroleum taxes, board / partnership wrangling in some cases, and in other cases the presence of significant antientrepreneurial mentality among the operators. He said, “Funding constraints are the main reason cited by the growing number of Nigerian exploration and production companies for inability to progress on projects, as well as the necessity to invite foreign technical partners.

“The need to invite foreign partners has become inevitable given that most local banks have not cooperated with marginal field operators in putting these fields into production. However, such invitations run contrary to the core moral concept and principles of the marginal fields’ licensing exercise. “The original principle behind this exercise whereby the government took undeveloped discoveries, which has proven oil, from the oil majors and awarded these to local companies, was

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to encourage indigenous capacity building in the upstream petroleum sector.

“The indigenous marginal field operators were expected to employ Nigerian geologists and petroleum engineers, acquire workstations for their use, utilize other local skills in field development (in the office and on operational site), put local talent on site to supervise well drilling and produce the oil, and in the event, increase the pool of technically capable oilfield personnel who can replicate the same exercise elsewhere in Nigeria and abroad. Therefore, to invite technical partners would mean that the country still has not ‘indigenized’ the development of these marginal oil assets.” Constraints He added that, “The second constraint is the relative marginality of the fields. Of the six companies that have brought their marginal fields to production as at 2011, only Mid-Western Resources (partnering with Mart Resources) are producing sizeable volume of crude oil (about 8,700 bpd). This is followed by Brittania-U (producing about 2,300 bpd) and Energia (producing about 2,000 bpd). Pillar Oil was producing 100 bpd before the well wateredout.

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“Some of these volumes can be quite discouraging for ambitious foreign E & P companies, considering the amount of investment required

to bring some of these fields into production. Production from swampy / deep sea fields is usually higher than production from onshore fields. This is a critical issue that investors have to consider too. “The third constraint is availability of local technical expertise. Undoubtedly, there exists abundance of local technical expertise, which has developed over a long period of time. This is so, considering that Nigeria has produced oil in commercial quantities since 1970 to date. However, most of them may not be available to work for marginal operators if they can earn more pay with established E & P companies. “It should also be acceptable to highlight the relative differential in quality between local technical expertise and the technical expertise available in Western countries. Consequently, the government is not averse to joint-ventures between marginal field operators and foreign technical partners, provided that the Local Content Act applies to board appointments, local employees, and inclusion of local contractors in the provision of goods / services needed for field development and production. “The fourth major constraint is government policy as regards royalties and taxes. New fiscal regimes have been proposed in the Petroleum Industry Bill (PIB). If the PIB is passed in its current form, operators will observe a significant reduction in applicable royalties and taxes. A reduction of about 30% in applicable royalties and petroleum taxes has been proposed, which makes it commercially attractive for small operators to develop these marginal fields very profitably. “The Bill also introduces a modern acreage management system with strict relinquishment guidelines,

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COVER STORY which provides for oil companies operating in this country to relinquish acreages from existing oil prospecting licenses (OPLs) and oil mining leases (OMLs), except acreages that will be developed in the near future, or those that are currently in production. This policy is meant to discourage operators from sitting on acreages that otherwise will be available to other credible investors.” Fields’ status In its report on the Nigerian marginal fields, one of the leading data analytics firm, Budgit, disclosed that there are about 178 marginal oil fields in Nigeria, noting that majority of the awarded fields were yet to begin production.

onshore, the production growth is greatly affected by infrastructure constraints resulting from attacks on the pipelines and oil theft in the Niger Delta.” Revoked licences Because of these constraints and many more, a number of the marginal fields in Nigeria had been unable to produce a single barrel of crude oil or any quantity of gas, almost two decades since there they were given the acreages. This was why in April 2020, the Department of Petroleum Resources, said it has revoked the licenses of marginal fields awarded to 11 firms.

It said, “The following major issues contribute to the under-utilization of the marginal fields and its consequent minimal contribution to Nigeria’s oil revenue:

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Discretionary decisionmaking, political interference and lack of transparency are the bane of the process of awarding marginal oil fields. The Department for Petroleum Resources (DPR), the institution in charge of managing the exploration licenses, does not publicly provide the criteria for prequalification of awardees. This makes the entire process opaque. “Reports show that in the past many of the winning companies were closely associated to government officials. This factor alone significantly affects the field performance, as most of the awardees do not have the technical skills to exploit the skills. This is also the reason why most of the marginal fields are dormant. “More so, there is no consistency or reliability in the bid process. The sudden suspension of the 2013/2014 bid rounds is an evidence of this. This again deters investment. Again, because the marginal fields are

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Mr. Paul Osu, Spokesperson for the DPR

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According to the DPR, the revocation stems from their inability to meet the requirements stipulated by the Federal Government.

Spokesperson for the DPR, Mr. Paul Osu, who confirmed that the licences for the marginal oil fields had been revoked by the Federal Government, said: “These fields were allocated to the licensees since 2003 and the agreement the licensees had with the government on award of the fields to them was that the fields, after five years from the period of allocation, would be

put into production. The licensees had always pleaded for extension of time and the government in its magnanimity continued to give them more time. “This is 15 years down the line. Has government not given them enough grace? None of the fields is producing as we speak. Remember that the marginal fields’ policy was government’s economic decision and action to stimulate the economy, increase reserves and most of all enable indigenous oil companies to participate in oil exploration and production. The government may put the fields on offer when carrying out another bid round.” The marginal fields’ licences that were revoked included: Ekeh field, Oil Mining Lease (OML) 88, operated by Movido Exploration and Production Limited; Ofa field in OML 30 and operated by Independent Energy Limited (IEL) with 67. 5 per cent equity, First Hydrocarbon Limited FHN 16.25 per cent and Xenoil 16.25 per cent; and Tom Shot Bank (TSB) in OML 14, owned by Associated Oil and Gas Services Limited. Another is Atala, located in OML 83. The Bayelsa State Government has 40 per cent equity in it while First Exploration and Production (40 per cent). Another one is Akepo in OML 90, owned by Sogenal Limited and Oando Energy Resources; Oriri field in OML 88, operated by Goland Petroleum Development Company and Ke, an onshore field located in OML 55 owned by Del Sigma Petroleum Limited. The rest are: Ogedeh field in OML 90, operated by Bicta Energy; Ororo field in OML 95, owned by Guarantee Petroleum Limited and Owena Oil and Gas Limited; Dawes Island field, located in OML 54, operated by Eurafric Energy Limited; and Tsekelewu field in OML 40, owned by Sahara Energy and African Oil and Gas Limited in ratio of 70 per cent and 30 per cent equity holdings. Success stories However, in spite of the many woeful stories of majority of the marginal fields’ operators, Lekoil’s story had been positive and remained a beacon

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COVER STORY of hope for the industry. Since acquiring the Otakikpo field in 2003, the company has raised production to 6,000 barrels per day and is now planning to take production to 20,000 bpd. Speaking on the successes of the company, Chief Executive Officer of Lekoil, Mr. Lekan Akinyanmi, said, “We built the infrastructure from scratch, so a lot of companies who bought assets from an IOC already have the infrastructure there but this place was just swamp; we first started doing civil works, we had to sand fill the entire place, we worked with the communities, sorted everybody out and then we re-entered those wells and built everything from scratch. “For evacuation, we built a sixkilometer pipeline that went underwater, so that there is a point where you connect and the shuttle tanker takes it to floating production storage and offloading (FPSO).” To achieve this feat, Lekoil said it collaborated with other partners,

“But collaboration has also been difficult with some local operators. For many folks that have been awarded these fields, you see a mismatch between expectation and reality,” Akinyanmi said. However, speaking on the challenges faced, Akinyanmi said, “Some of the fields are truly marginal; they are quite small; it may not be as easy to develop them on their own unless they are part of a cluster. It means people have to collaborate more but in Nigeria we haven’t proven to be so good at working together.” Another success story is Waltersmith Petroman Oil Limited. The company was incorporated in 1996 as a Joint Venture between Waltersmith & Associates Limited, a Nigerian company and Petroman Oil Limited of Calgary, Canada to operate as an petroleum exploration and production company. In 2001, Waltersmith Petroman Oil Limited became a wholly owned Nigerian company with the divestment of Petroman Oil Limited.

crude oil plus condensate production; processing 50 million barrels per day crude oil plus condensate refinery; processing 500 million standard cubic feet per day (MMscf/d) gas primarily as fuel for power and the installation and supply of 1000 megawatts of electricity, including renewable. In October 2018, Waltersmith performed the ground-breaking ceremony of its 5,000 barrels of oil per day (bopd) modular refinery and have already commenced work on the development of an additional 25,000 bopd. Also, by January 2020, during his visit to the company, Minister of State for Petroleum Resources, Chief Timipre Sylva commended Waltersmith Petroman for its plans at promoting Nigerian content while driving fuel sufficiency in the country, with its 30 000 barrels per day modular refinery, being constructed at Ohaji/ Egbema Local Government Area, Imo State.

In 2003, the company participated in the Nigerian marginal oil field licensing round for indigenous companies and was awarded the Ibigwe field located in Oil Mining Lease (OML) 16 by the Federal Government of Nigeria. The award was secured on a joint interest basis, with Waltersmith holding 70% and Morris Petroleum Limited, 30%. In 2004, the Company executed a farmout agreement with Shell Petroleum Development Company and its Joint Venture Partners including the Nigerian National Petroleum Corporation (NNPC) and effectively took over operatorship of the asset. Over the years, the Mr. Lekan Akinyanmi, Chief Executive Officer of Lekoil

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company had made significant investments in the business and had set a target of achieving by took the company public, and 2026, 100,000 barrels per day installed corporate governance (bpd) structure thereby increasing its chances of securing funding.

Chief Timipre Sylva

The Minister had confirmed during his inspection tour that the refinery construction is currently at an advanced completion status of over 90 per cent. Another success story in the marginal fields programme is the Niger Delta Exploration and Production Plc, which have successfully

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COVER STORY explored and commenced production on its oil fields and had successfully built and operated a modular refinery. However, despite the unimpressive performance of majority of the marginal fields and the successes recorded by a few, especially in Nigeria and a few African countries, as well as the global economic challenges,

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experts are unanimous in their views that the marginal fields’ awards should proceed. According to some of the analysts,

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the marginal fields’ bid rounds would afford many African countries the opportunity to easily mobilize revenue that would not be easy to come by due to the downturn; while some others are of the view that the award of the blocks would help the affected countries shore up their crude oil and gas production and mobilize much-needed foreign exchange revenue. Going on with marginal fields auctions Specifically, Program Coordinator of the Nigerian Natural Resource Charter (NNRC), Ms. Tengi GeorgeIkoli, stated that going ahead with its proposed marginal fields’ sale would make a significant contribution in helping Nigeria curtail the impact of the envisaged global economic downturn. She said, “As the COVID-19 health crisis persists, attempts to curb the spread of the disease continue to significantly affect global revenues and resources. The universal measures of social distancing, movement restrictions, lockdowns, though necessary to stem the spread and impact of the pandemic have on the other hand, contributed to slowing down the global economy. “Sustained low oil prices and price volatility has and is expected to continue to reflect negatively on the Nigerian economy, thus the need to adopt policies that sustain its revenues in the short 34

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to medium term while exploring long term options to drastically reduce over dependence on oil postcovid-19.

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“The effects of the pandemic on the oil sector underscore the imperative to revisit the much advertised policy of economic diversification. “While commending the Nigerian government on the steps taken to sustain the Nigerian economy through oil sector reforms; to deregulate the downstream sector, re-open bid rounds of marginal fields, cut the 2020 budget, contemplate privatization of the refineries and others, there are some additional interventions required to crystallize those policies and further support the Nigerian economy. “Moving forward, all strategies must be sustainable, if Nigeria is to minimize the effects of the inevitable recession due to the falling oil prices, depreciating revenues, rising debt ratio and diminishing reserves. The recent OPEC + production cuts may be too little too late and so Nigeria must look internally for solutions and adopt interventions that take a longer term view.” Essence of PIB On his part, Professor Nwaozuzu, maintained that despite the challenges encountered in the past, the future of marginal fields’ development looked promising. According to him, going forward, there are a number of financial, technical initiatives and government policies that would aid the process of marginal fields’ development, adding that the most important of these was the passage of the PIB. On the technical side, Nwaozuzu noted that operators would have to develop more effective reservoir management systems and synergistic facilities utilization in order to boost mutual profitability. In addition, he said, “Energy and petroleum academic centres in the country should be strengthened through

funding by local industry players. This should enhance human capacity development needed in the industry and reduce the strong dependence on expensive expatriate personnel and skills. Presently, investment in marginal fields comes from JV, Debt and Equity financing, or a combination of these.

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“There should be more effective mutual integration between operators and the local financial sector. Operators can form Special Purpose Vehicles (SPV) and tap into the international investment market as well. They can also attract more capital expenditure (CAPEX) investment by aggregating or co-mingling proximal fields’ reserves in order to achieve critical volumes.” On the other hand, Nwaozuzu said, “Government has a crucial role to play in enhancing the profitability of these ventures. Government can revise the fiscal terms and make them more investorfriendly; suspend royalty payment for at least three years from commencement of production to eliminate front-loading of royalty payments and thereafter apply the sliding- scale method to royalty payments based on producibility; and provide tax holiday of 3 years by suspending VAT, import fees, education tax, among others. “The CBN can support the local banks in reviewing monetary terms for energy projects, and government can also establish Energy Bank, as separate from Bank of Industry, to enable local energy companies gain access to funds at globally competitive rates.” From the foregoing, it is obvious that conducting bid rounds within the next couple of months for the award of marginal oil and gas fields would be negatively impacted by the envisaged global economic downturn brought about by the COVID-19 pandemic and to a large extent, the low price of crude oil in the international market. However, it has become expedient that the auction of the fields must be conducted irrespective of the unfavourable economic condition, especially going by the numerous advantages presented by the award to economies.

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SOCIAL INVESTMENT

Wapco Invests $2.6m in Scholarship, Skill Acquisition

he West African Gas Pipeline Company Limited ( WAP Co) said it has invested over $2.6million (N988,000,000.00) in the past seven years in form of Scholarship Program for Tertiary Institutions and Skill Acquisition programs for those interested in learning a skill among its host communities. According to the Managing Director of WAPCo, Mr. Gregory Germani, the past months have clearly shown us how much of a village the world is now, for a virus to travel about 10,000 kilometers and have as much effect on the world as the COVID-19 virus has. Represented by Deputy Manager, External Relations, West African Gas Pipeline Company Limited, Mr Temitope Sodeinde, Germani said “Having seen the general lack of protective equipment and medical supplies for medical personnel around the world, WAPCo felt it necessary to extend a hand of fellowship by supporting the Lagos State and Ogun State Governments with a few needed materials.

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We are, however, grateful for the leadership that has been provided to curb the spread of this menace, especially by the Ogun State Government, through the Incident Commander, His Excellency the Governor,Prince

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Dapo Abiodun, and his lieutenants.” He said as partners in progress, WAPCo has invested a lot in the development of communities within which it works. “So far we have invested $2.6million over the last 7 year in schools, hospitals, and water supply points built by WAPCo to foster good neighbourliness. We launched the Livelihood Program, which enables children from within our areas of operation to have access to education. This is either in the form of a Scholarship Program for Tertiary Institutions and a Skill Acquisition program for those interested in learning a skill. “Today, our communities can boast of first class graduates in Medicine, Engineering and the likes, as well as proud business owners who are daily improving on their outputs in response to the daily need for artisans in our society. Today, we are here, not only as representatives of the West African Gas Pipeline Company Limited, but also as a part of humanity,” he said. Receiving the donated PPE and other medical equipment on behalf of Ogun State Governor, Dapo Abiodun, Commissioner for Health, Dr. Tomi Coker, thanked them management of WAPCO Limited for donating PPE

and vital medical items to Ogun State in fight against COVID-19 pandemic. “On behalf of His Excellency, Governor Dapo Abiodun, I thank you for these donations. The PPE and other medical items donated came at the appropriate time when our health workers who are at the frontline are constantly exposed. We do know that over 40 of them have been infected and we in Ogun State are very proactive in ensuring that hopefully none of our frontline officers get exposed or found themselves in that situation. “So with this, you are actually partners in progress in ensuring that we protect our frontline workers and we will make judicious use of the PPE and other medical items which you have presented to us. So once again, thank you very much and please give our regards to other senior executives of WAPCO,” she said. WAPCo owns and operates the West African Gas Pipeline, a 678km pipeline that transports natural gas from Nigeria to the West African Region in a safe and reliable manner. It has a metering station in Ota, Ogun State and a Compressor Station in Badagry, Lagos. Between these two locations in Nigeria, WAPCo owns a 57km Right of Way that runs through more than 50 major communities.

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SOCIAL INVESTMENT

NNPC – AGIP Begins Construction of 200 Bed Infectious Diseases Hospital in Yenagoa The Group Managing Director of NNPC, Mr Mele Kyari noted that the Corporation was working with its Joint Venture partners, across the upstream, Midstream and Downstream Sectors to support the health sector. According to him, the NNPC led intervention had allocated the N21 billion worth of support to various International Oil Companies, Indigenous operators with Joint Venture stakes across the oil sector.

Governor Douye Diri of Bayelsa State performing the ground breaking for a permanent Emergency and Infectious Diseases Hospital for the South-South Region in Yenagoa – a project of the NNPC-led Oil & Gas Industry Intervention Initiative on COVID-19.

igerian National Petroleum Corporation (NNPC) in collaboration with Agip Joint Venture has flagged off the construction of a 200 bed capacity infectious diseases hospital for the SouthSouth Zone in Yenagoa, Bayelsa State capital. Speaking at the event, the Minister of State Petroleum, Chief Timipre Sylva, said the project was part of the Nigerian Oil Industry Coalition led by the NNPC to support the nation’s efforts to combat the COVID-19 pandemic. Stating further that the oil industry was contributing about N21 billion worth of support provided through the internal procurement processes of contributing companies. He said Bayelsa was considered a suitable site for the project given its pioneering role in the history of the state and the contribution of about 40 per cent to onshore crude oil output. In his words, “Before this hospital, the oil industry through the instrumentality of the NCDMB located in Bayelsa has also donated ambulances, to the Bayelsa state government. This action is taken to support national health care delivery facilities and strengthen our collective national resolve in combating this pandemic, and its dreadful impact. The intervention

initiative is in alignment with the ongoing federal government efforts to curb the pandemic through the Presidential Task-Force on covid-19 and it covers three key areas. The total commitment to this initiative, amounts to $58 million which is about N21 billion in the first instance in order to ensure transparency and accountability participating companies will execute the project, and items procurement using their internal companies established processes. All commitments under the initiatives are collected in kind and a clear and transparent governance frame work has been established for collecting and distributing the commitments, across the countries in alignment with the processes and procedures of the presidential task force on coronavirus. On the choice of Bayelsa, he said “Bayelsa State is of strategic importance to the nation. It is the state where the first commercial discovery of crude oil was made, thereby launching the country into the limelight of the petrol state nations also it is the state that also accounts for almost forty per cent of the nation’s total offshore oil production indeed, nowhere deserves to be selected as the first state to kick start the most important category of this intervention initiative than the glory of all lands.”

He explained that the infectious diseases hospital sited on 1586 square meter space would serve as zonal isolation centre for the COVID-19 and would serve as reference hospital for communicable diseases after the COVID-19 pandemic. In his speech, Mr Lorenzo Fiorillo, Managing Director, Nigerian Agip Oil Company (NAOC) noted that the outbreak of the corona virus has put a lot of strain globally on health care systems and personnel. Fiorillo who spoke through Mr Macwon Jitubo, Head of Community Relations, NAOC noted that the company remains sympathetic to the threat posed by the corona virus resulting to millions of death worldwide. “Eni, the parent company of NAOC considers people to be at the core of its culture and fundamental to its business, aware that creation of reciprocal values is possible through the sharing of objectives. we are certain that the Oil and Gas industry as a whole shares in these value. It is for this reason that we are here today at this difficult to perform the ceremony which will engender a valuable medical asset to the South South region of the country,” He said. Earlier, Gov Douye Diri of Bayelsa who lauded Sylva for attracting the project to Bayelsa performed the ground-breaking ceremony alongside other dignitaries. Mr Chukwuemaka Nwajiobi, Minister of State for Education who represented the Chairman of Presidential Task Force on COVID-19 and Secretary to Government of Federation, Mr Boss Mustapha at the occasion. The project which is the first of its kind in the entire South South when completed is expected to provide general medical services to the public, disease control centre, In-situ diagnostic lab, 200 capacity bed spaces scalable on both flanks & behind.

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SOCIAL INVESTMENT

OILSERV Ltd, Foundation donates food, medical supplies to host communities, states and Federal Government of Nigeria.

he coronavirus pandemic has had a devastating impact around the world disrupting lives, livelihoods, communities and businesses worldwide. Oilserv Limited commends the effort of Federal Government and the various State Governments in their bid to not only find solution to the pandemic and treat patients that have contracted the disease, but in their daunting effort to provide palliative to the teeming populace. In a bid to cushion the effect of the pandemic on the livelihood and health of the host communities in Rivers State as well as support other States and the Federal Government in the fight against the pandemic, Oilserv Limited in conjunction with the Sir. Emeka Okwuosa foundation donated food stuff and medical supplies worth over 100 million naira. In Rivers state, a total of 350 bags of rice were distributed to four different host communities namely; Woji (100 bags) Rumuibekwe (100bags) Ogale, Eleme (50 bags) and Uzuaku community in Abia state (100bags). In addition, the Company

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is donating medical supplies worth over seventy million naira which includes disposable face masks; 6000 nos, FDA approved mask; 1,500 nos, hand gloves; 80 cartons, face shields; 8 cartons containing 500pcs per carton, disposable protective suit; 1200 nos, infrared thermometer; 250 nos, facial and temperature monitor; 5 nos, COVID 19 rapid test kits (15 minutes result) 2500 nos. These materials have been ordered and are arriving this week. The benefitting States are; Rivers, Anambra, Enugu and the Presidential Task Force through the NNPC. O ils e r v L imite d , a l ea din g Engineering, Procurement, Construction, Installation and Commissioning Company in Nigeria has been a major player in the Oil/ Gas industry since her inception in 1992 and has contributed immensely to the development of pipelines systems infrastructure in Oil & Gas industry in Nigeria as well as other infrastructural projects that positively affect the economy of the country. Driven by the sheer determination and passion to impact lives positively, The Sir. Emeka Okwuosa Foundation also donated over 3,000 bags of rice and

a lorry load of yams (8000 tubers) to families in Oraifite and Ozubulu, Ekwusigo Local Government Area of Anambra state to cushion the effect of the Corona Virus and the lockdown in the state. Speaking with the press, Director of the Sir. Emeka Ok wuosa foundation; Hon. Azuka Okwuosa said ‘’we believe in the power of humanity to solve any challenge. The foundation’s contribution to families and communities in Anambra state aligns with our deeply rooted commitment to impacting lives positively and to support the state government against the fight of the Corona Virus at this difficult time’’. He further stated that their thoughts and prayers are with those affected by COVID-19 and the healthcare workers on the front lines battling to contain the outbreak. The Foundation’s poverty alleviation programme which also comes through capacity building, provision of basic amenities such as roads and water, and award of scholarship to the people, had improved the standard of living of people in Oraifite and its neighboring communities.

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ENERGY WOMAN

“Our coverall is good enough to be used in the rigs as PPE… -Noxie

gozi Oyewole, also known as ‘Noxie’ is the Founder of Noxie Limited, an awardwinning, SONCAP (SON/ LSOII/CB/2324) and MAN (MAN/ GML/05047) integrated service provider and manufacturer. She is a certified health and safety professional whose company plays actively in the supply chain of PPEs used by oil majors and service companies. Noxie equally maintains a good market share in construction, healthcare, food and logistics. In 2015, she was nominated by Forbes Magazine as one of the leading women entrepreneur in Africa championing business sustainability and women inclusion in business. Among several bodies, she is a member of the PanAfrican Manufacturers Association (PAMA); the International Women’s Society (IWS); Lioness Club of Africa Group; Thrive Women Solution; GAIA Women Club; Global Fund for Women and World Pulse Group. In this interview with Jerome Onoja, she speaks on a number of issues. Internationally, you have created

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a mark for the Noxie Brand via numerous recognitions. Forbes magazine acknowledged your prowess few years ago, can you tell us about it, please? Well, I really thank Forbes for the recognition because that publication actually set things right for me. It helped me to keep my eyes on my big vision and to make it happen. I really don’t know how Forbes found me, but I knew they kept on calling. The major question asked was where Noxie would be in five years. It left a big question mark. I don’t give in quickly to things, even though at that time my company was at an admirable stage and everything was looking good. What people didn’t know was that at that time,

“

I just wanted to run away and do nothing as an entrepreneurship But after the publication, I sat back, beat my chest like Esther in the Bible

and said “If I perish, I perish, I must go on”. Here we are today. A few others have featured me like the We Connect International, GAIA Africa, Women Economic Forum, This Day, and we have received different awards. I just thank God. How has your upbringing helped in shaping your philosophy into the woman you are today? Well, my parents did a good job for beating me the Nigerian way, if you know what I mean. My mum always flicked her eyes and drummed into my ears that a good name is better than riches. She was also an entrepreneur who taught me that a woman should be multi skilled. Both parents taught me to be positive in everything. I had the right discipline, I had love. I grew up with encouragement, I was criticised positively not negatively. I had very good listening parents and then married a man who always listens, cares and fears God.

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ENERGY WOMAN What is the story behind the name, Noxie? Noxie is my pet name and brand trademark by the Ministry of Industry, Trade and Investment. I appreciate the recognition. Feeling needed and appreciated are important incentives to keep you going. Life is about choices. If you discover ways to make the necessary unpleasant things enjoyable, you will hit jackpot. My quest for excellence, which didn’t come easy, requires unflinching focus. I found my path, speed, strength and I challenged the limitations. There has been an awakening, leading to increased advocacy for women empowerment and participation in the oil industry. What has been your advice to the various groups? The role of women cannot and should not be ignored. I’m sure we all know that when we empower a woman, everyone benefits but unfortunately, women are still treated as second-class citizens of this world. In some areas, girls are almost completely ignored with no status, no protection, or prospect. Even in many families and communities, inequality is so entrenched that it is not even questioned. I belong to the We Connect International; Learners of Africa; Women in Energy Oil and Gas; Wo m e n E c o n o m i c F o r u m ; Commonwealth Business Women Network, Nigeria where I am the COO; Women in Business (WIMBIZ); Africa Women in Entrepreneurship Program; Women in Manufacturing; Pan African Manufacturers Association just inaugurated at the African Union in Addis Ababa, Ethiopia. As a woman, capacity building fosters a sense of ownership and empowerment. With it, you have control over your selfdevelopment in areas of knowledge, resources, and solutions. It is important to be confident and able to light another woman’s candle until a full cycle is achieved so we all can shine together.

Noxie

What is Noxie Limited into? We are into integrated safety facilities and as alumni of Said Business School in University of Oxford, I learnt how to disrupt the giants when they’re sleeping. Everything we do is in line with the Nigeria’s local content standard and this really produced the famous registered Noxie coverall. It has gone through the various tests and passed.

“

Our coverall is good enough to be used in the rigs as PPE because it matches global standards, whether European or American. We also make other COVID-19 Medical PPEs and protective wears

like disposable coveralls, gloves, face masks, the normal brands like KN95, 3M/ N95/8210. We do the nitrile gloves. We service the oil and gas industry, medical industry, laboratories, construction, and food industry. We provide PPEs for companies and also use our machines for the branding. As a diversified company, we have the Noxie Furniture Factory in the heart of Mushin, Lagos. All our furniture are Ergonomic as the comfort and health of our clients mean a lot to us. The head, back, arm all need to be in the right position to avoid any occupational hazard. Our PPE offices are in Port Harcourt, Rivers and Eket, Akwa Ibom. Because we prioritize the comfort of our clients, our furniture are beautiful and ergonomic, considering various occupational hazards, neck ache, waist pain and others.

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ENERGY WOMAN Our Architectural and interior design division, deals with remodeling, office fit out, out door construction, structural repairs and renovations. The logistics division of our business, deals with the moving our products to our clients in various locations. However, when they’re not in use, we then use them for haulage of moving other goods commercially from one end of the country to another. So as you can see, I have been able to explain how each division of Noxie Limited is inter twined. So when my friends wonder I cope, am sure reading this article would finally explain how these various activities complement each other.

“

So, for an interior decorator and a creative hands-on person like me, it works very well for me without stress. Your philanthropic activities transverse regions. Are these in line with some SDGs aspirations or are they just spontaneous? A heart to give is probably my nature but

“

I am an ardent supporter of the Sustainable Development Goals which are universally applicable.

Even now, I am the CEO of the Commonwealth Business Women Network in Nigeria which promotes entrepreneurial development so we collaborate with other organisations. For me,

“

the smile from a thankful person shows you’re really making a difference in someone’s life and that for me is the greatest feeling in the world. 42

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We uplift women through farming. It goes beyond just teaching them or supporting them. Sometimes you kind of get involved with what they do in their personal lives. I have over 200 widows I inherited from my mother. She had a widow’s ministry before she passed. I didn’t want that to die. So I took it on. They are now 400 widows. You know the life of a widow in certain parts of Nigeria, how they are treated and some of them don’t have children or support. We look after them, provide healthcare, clothing, food, and even give the very old, helpless ones a bath. Sometimes when they pass, I kind of do my own bit to give them a burial. I put them up in groups like a cooperative to support one another. Some of them are widows indeed but there are some young ones I mentor back into the society to remarry. We arrange for them to learn various skills. Others turn out to become tailors or hairdressers, and so on. So, I don’t know what you want to make of it. You can call it spontaneous, or SDGs, I just have a heart to feel what the next person feels. And then naturally, I am a very happy person. I just like to help. It’s not about money. You can even call me “Agony Aunt”. I also have some children I inherited from my mother who owned a school which she passed on to me. She had about 50 children she was paying fees for. Going through my mum’s documents when she passed, I found a file that had about 50 children and she was paying their schools. Some I still have not met but I just continued from where she left. I don’t know them. I just continued paying the fees to the school. I only get phone calls when they say they have just graduated and then I help wherever I can. There are other people I just give to, kindness is not something you say in public. It is a part of what you share. It’s not about wealth but doing what you should do. Being rich is not in having the best car or wearing expensive clothes. It’s about giving, showing love and putting a smile on someone’s face. As a woman, what has been your greatest fear in business and how did you manage? What is your take

about the glass ceiling for women achievement? Entrepreneurship is not for the lilylivered. The first worry is the fear of the business thriving, looking at the risks involved. You may think you have it all together but occasionally, the worst scenario plays up in your mind - like a bang! It is not always the lack of capital or skills. For me, I wipe my face and confront my fears. When you are playing with giants, you are always the underdog. So, they underestimate you, and while they are asleep, you are awake doing something great. And, when they are awake , you would have covered miles. Self-development is very key when you are in this situation. For me, I equipped myself, got certified in over 35 entrepreneurship certifications, which of course builds one’s confidence that shows that, this lady is good enough for the job. You can never have the feeling of fulfillment until you impact or touch another woman’s life. So, I mentor some women in South Africa and Bangalore under the Cherie Blair foundation. What is the vision for Noxie ten, fifteen years from now?

“

Right now, succession plan is in place. I have groomed my team and I am getting to where the baton will change hands. I think the foundation is right because the company is running well with all the processes and procedures in place. For us, training, continuous self-development, learning is very important. We have this beautiful culture, and everybody is tightly interwoven, doing his or her own specialised thing. In ten years, Noxie limited will be a multinational entity in the energy space. With COVID 19, a lot has changed.

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ENERGY WOMAN

“

So I get up and I go. For me, prayer is mandatory and I have that together because I know God has got my back and I don’t take it for granted. I love Scrabble, it was one of the things that brought my husband and I together. I play Scrabble on my phone, and audio book.

to be out there and do good things. But it’s not cool not to have a family to come back to. I think I’m blessed.

The robust client base was not attained by having the support of any foreign partner. I learnt on time never to miss an opportunity. When I had the chance to showcase myself, I put in my all and I ran with it.

I have the most supportive family where everybody helps in different ways. My patient husband tolerates my excesses of traveling all the time. Well, my work life is on the go. My lifestyle is a tough one. But somehow my family and my best friend are my biggest supporters. Sometimes I kind of want to give up and they come to my aid. I’m naturally a happy person. I play really hard when I’m not working.

I used to be in Nollywood many years ago. For Christmas celebration, I pack up, whether I’ve achieved or not. Christmas is a big thing in my family. My kids come in from everywhere, we reunite as a family in our beautiful hometown in Igbajo, Osun state. So we’re able to find time together to have fun. I was lucky. I stayed home for ten years after I got married. I just brought my children up to the point where I knew I had done what God guided me to do, while my husband was providing everything. And when it was time to get back to work, I took off but was mindful of the invisible leash that always reminded me that no matter how hard I work out there, home was always important. This could differ from person to person. I believe everyone should stick to what works for that person.

I can wake up to attend a friend’s birthday party in Dubai because it’s only the living that can enjoy life.

It is a good feeling to know you have a family to run to. So I always say, “When everything fails, there is always a home to run back to. So I tell other women that, It’s beautiful

Noxie is also responsive to change and will keep evolving. We should not be underestimated because a lot has gone into the company in the areas of intellectual property investment, monetary investment and unwavering family support. 10 years from now, all manufacturing will be done incountry and by Nigerians. We will still be soaring. How do you maintain a healthy worklife balance?

“

You have established a robust client base across the country. We believe this was attained with the support of some foreign partners?

The foreign partners appeared after that. I always tell people, everything comes from within you. Whatever you want to be starts from inside of you. Everybody needs a ladder holder. Certain talents die because they never got a chance. I am grateful to God that I was given a chance, I showed what I could do and I kept on believing in myself. It’s important to note that self-development is crucial to continued relevance. You can’t use old methods to fix this new normal. We are in the digital world where technology has taken pride of place in the new normal. As things changed, we changed too. So it wasn’t about any foreign partners. Everything happened here in Nigeria.

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ACROSS AFRICA

Equatorial Guinea Grants Two Year Extension for All Oil & Gas Licences

n e m o n t h a f te r it announced the waiving of its fees for oil service companies in the country, Equatorial Guinea has granted E&P companies a two-year extension on their exploration programmes. The grant, the country says, “will also ensure flexibility on the work programmes of producing companies to ensure growth and stability in the market”. In late March, the Ministry of Mines and Hydrocarbons MMH said it took the unanimous decision to waive its fees for service companies for a duration of three months, adding that it recognised the fact that the oil sector continues to be the largest private sector employer in the country and “we want to give our local services companies the means to weather the storm and avoid any jobs being lost”. It said it was “the first action to be taken to support oil & gas services companies in the wake of the oil price drop caused by the coronavirus pandemic”. Oil prices have headed farther south in the four weeks since that first announcement, with the horizon even cloudier. Yesterday’s press release announcing the grant of extension of tenor of acreage licences came less than a week after the Petroleum minister, Gabriel Mbaga Lima Obiang, suggested at a webinar that countries should be granting extensions for E&P licences at this time, as companies would be unable to carry out work programmes with

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any clarity until 2021. “The Ministr y of Mines and Hydrocarbons remains concerned about the resounding impact of the drop in oil prices, COVID-19 and its dramatic consequences on our hydrocarbons industry”, says the release. “At a time of great uncertainty, we have an obligation to make bold, decisive, and pragmatic policy decisions to get the industry moving again,” the statement explains, adding that the government is fully committed to safeguard local oil & gas industry, its companies and its employees. “The granting of these extensions has been deemed suitable to create an enabling environment for international and African companies to keep investing in Equatorial Guinea and ensure a quick recovery of our industry. “The MMH will continue working with oil companies benefitting from such incentives to make sure that the recovery of Equatorial Guinea’s oil sector is made on the back of local content promotion, increased technology transfers, and procurement of additional local goods and services. A particular emphasis will be put on educating, training and promoting local workforce to help further reduce operational costs for international

companies while maximising the creation of local value and revenue”. W ith th e s e p ro p o s als , th e Equatoguinean authorities say they guarantee existing investments into Equatorial Guinea, while empowering local companies to assist their foreign partners in safeguarding and increasing their operations in the country. “Some of these companies operating in Equatorial Guinea notably include ExxonMobil, EGLNG, Marathon Oil Corp, Atlas Petroleum, Kosmos Energy, Noble Energy, Glencore, Royal Gate Energy, Gunvor, Trident Energy, etc. “Such historic measures are being rolled out as Equatorial Guinea implements a series of landmark projects across its upstream, midstream and downstream industries. The backfill project is already ongoing to pool supply from stranded gas in the Gulf of Guinea and replace declining output from the Alba Field. Meanwhile, the ongoing Year of Investment has generated strong interest from various existing and new players in Equatorial Guinea to build and expand midstream and downstream infrastructure and maximise local processing and transformation of domestic crude oil and natural gas.”

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ACROSS AFRICA

Far to Sell all or Part of its Interest in the Sangomar Development Offshore Senegal

AR Limited reports that debt financing for the Sangomar field development offshore Senegal is not proceeding as expected due to COVID-19 and oil price impact on debt markets and the Company has commenced a process to sell all or part of its working interest in the Senegal Rufisque Offshore, Sangomar Offshore and Sangomar Deep Offshore (RSSD) project in parallel with investigating alternative sources of finance. In January, The Government of Senegal approved the Rufisque Offshore, Sangomar Offshore and Sangomar Deep Offshore (RSSD) joint venture Exploitation Plan and granted the Exploitation Authorisation for the Sangomar Field Development offshore Senegal. Woodside, as Operator of the RSSD joint venture executed the purchase contract for the floating production storage and offloading (FPSO) facility and issued full notices to proceed for the drilling and subsea construction and instalment contracts, including: * MODEC Inc for the purchase of an FPSO * Subsea Integration Alliance for the construction and installation of the integrated subsea production systems and subsea umbilical risers, and flow lines * Diamond Offshore for two wellbased contracts for the drill rigs Ocean BlackRhino and Ocean BlackHawk Following the grant of the Exploitation

Authorisation, the RSSD joint venture executed the Host Government A g re e m e nt w ith the Government of Senegal and took an unconditional f inal inves tm ent decision (FID) for the Sangomar Field Development phase 1. The Development and E xploitation Plan outlines the full field multi-phase development of oil and gas and details how the Sangomar Field (formerly SNE Field) will be developed in a series of phases using a stand-alone floating production storage and offloading facility with an initial 23 subsea wells and supporting subsea infrastructure planned for Phase 1. The FPSO is sized for the integration of potential future development phases, including gas export to shore and future subsea tie-backs.First oil is targeted in 2023. A high-definition 3D marine seismic survey across the SNE North, Spica area was completed in February 2020. On 27 March 2020, the Sangomar Operator, Woodside, announced the joint venture was taking early action to manage the impacts of COVID-19 on the supply chain and project schedule. The joint venture continues to evaluate options to reduce the total cost and near-term spend whilst protecting the overall value of the investment. Financing Update COVID-19 and the recent oil price collapse adversely impacted FAR’s financing plans for the Sangomar Field Development. The severe tightening of global debt markets, especially for oil and gas companies, resulted in the debt arrangements FAR had put in place at the beginning of the year being unable to close or complete. FAR has been taking action to seek to preserve shareholder value from this world class asset in the intervening weeks. FAR is contractually committed to the Sangomar Field Development and the approved 2020 work program and budget of US$163M (net to FAR).

FAR recognises that it is unlikely to be able to fund its future share of the substantial project commitments based on its current cash reserves and future equity raises alone. The process has commenced to sell all or part of the FAR working interest and investigate alternative sources of finance. In addition, the joint venture is working together with our contractors to cut CAPEX and rephase expenditure into the future to ease the pressure on all partners’ cash flow at this time. The Sangomar Development was running US$117M under budget for the year to end of March and we expect this trend to continue. FAR’s Managing Director Cath Norman said: Reaching FID on Sangomar was a momentous milestone for the joint venture and the people of Senegal and FAR is proud to have played an integral part in the discovery, appraisal and now commitment to develop the significant oil resource offshore Senegal. We thank all our stakeholders and assure you the joint venture is working tirelessly with our partners to manage the impact of COVID-19 on supply chain, costs, and schedule. The key challenge for FAR over the coming weeks is managing the fallout of the COVID-19 epidemic and oil price rout with respect to our ongoing commitment to the Sangomar Field Development and associated work program and budget approved for 2020. FAR thanks its shareholders for their support in the capital raise and SPP at the beginning of the year and welcomes new shareholders to our company. Progressing a sell down of FAR’s working interest in Senegal or arranging alternative financing for FAR’s share of the development and at the same time preserving cash and shareholder value in our assets remain clear objectives of the Board at this time.

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ACROSS AFRICA

First Unitization Agreement between Eni and Springfield Exploration and Production (E&P) will impact on Ghana’s oil and gas industry “Oil and gas works best with an enabling environment. The Government of Ghana and the Ministry of Energy are demonstrating a very pro-active attitude towards the development of the country’s oil & gas sector. Their directive to push for negotiations on a Unitization Agreement on Afina and Sankofa to be completed within 120 days is proof of political will that works to benefit the energy sector and the country,” stated NJ Ayuk, Executive Chairman at the African Energy Chamber.

ollowing study of technical evidence from Springfield E&P (SEP)’s West Cape Three Points 2 (WCTP2) License and Eni’s Offshore Cape Three Points (OCTP) License offshore Ghana, the Government of Ghana has declared earlier this year that the Afina-1x Cenomanian reservoir and the Sankofa Cenomanian reservoir are “one and the same”.

per Regulation 50(6) of L.I. 2359.

This conclusion calls for a Unitization Agreement between both operators in order to develop the reservoir that straddles both of their blocks.

The conclusion of such an agreement would ensure efficient reservoir exploitation, avoid unnecessary competitive drilling and maximize e c o n o m ic re c ove r y of t h e hydrocarbons reserves from both licenses.

This Unitization Agreement of the Afina and Sankofa Fields was requested by Minister of Energy, Hon. John-Peter Amewu, in a letter sent to SEP and Eni in early April 2020. The government’s direction then requested unitization talks to be completed within 120 days (four months). Shall both parties fail to comply with the government’s directive to agree on a Unitization Agreement, the Minister of Energy is empowered to stipulate the terms and conditions of such an agreement

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While both operators have until August 2020 to complete their negotiations, the African Energy Chamber is hopeful that it will result in the very first Unitization Agreement between an International Oil Company and a Ghanaian operator in the country, ushering a new era for Ghana’s upstream sector.

This would not be the first such agreement in Ghana. In July 2009, a Unitization and Unit Operating Agreement (UUOA) was signed for the development of the Jubilee Field, appointing Tullow Oil as its operator. The field entered into production a year later and has been successfully producing since then, becoming the crown jewel of Ghana’s oil & gas sector.

“Fast-tracking the development of these fields is very positive given current market dynamics and ensures that a credible Ghanaian operator will start producing at a time when other players are shying away from investing in Africa’s upstream,” he added. “We are very bullish that Springfield E&P can move ahead, make the deal work for Ghana’s oil sector and become a remarkable example of what African E&P companies can achieve for our industry and our continent,” concluded Ayuk. SEP is a majority interest holder (84%) and operator of the WCTP2 License, with the Ghana National Petroleum Corporation and its exploration company, EXPLORCO, holding the remaining interest. SEP drilled the Afina-1 well in October 2019, making two gas and light sweet oil discoveries at a water depth of 1,030 meters, and consequently more than doubling its proven oil reserves to 1.5 billion barrels and adding 0.7Tcf of gas. On the other side, Sankofa is a part of the Eni-operated OCTP Block, where Eni holds a 44.44% interest, Vitol 35.56 %, and GNPC 20%. The OCTP Block is reported to have reserves of about 40 billion cubic metres of unassociated gas and 500 million barrels of oil, and has been producing since 2017 from the John Agyekum Kufuor FPSO.

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