Orient Energy Review September 2017

ENERGY rient O R e v i e w

w w w .o r i e n t e n e r g y r e v i e w .c o m

Covering Local Content Oil & Gas N500

7.0Ghc US $3.00

Vol 6 No.09 September 2017

Offshore Africa:

Exploring the Continent’s growing oil Sector in the Wake of Market Rebalancing

Ghana: Launches World Energy Council’s Future Energy Leaders’ Program

Nigeria: Major Shake-Up In NNPC; 55 Top Officials Affected

TRANOS, A True Manifestation of Local Content Drive in Nigeria Orient Energy Review Vol www.orientenergyreview.com

6 No.08 September 2017 1

Surpassing Expectations With Cutting-Edge Technology At TRANOS we believe in continuous improvement of Process, Technology and People.

Our vision, values and forward-thinking approach to all projects has propelled us to become the company we are today.

After delivering some of Nigeria’s most innovative and critical engineering solutions, Tranos has a strong opinion about what it takes to deliver complex projects in a creative, timely and cost-efficient way.

Our Capabilities Onshore and offshore steel fabrication and installation Design, Fabrication and installation of Mechanical & Process equipment packages/skids including rotating equipment packages Design, Fabrication and Installation of Electrical and Automation systems and panels Onshore and Offshore facility maintenance

We Think Further. www.tranos.ng

sales@tranos.ng

2 Orient Energy Review Vol 6 No.08 September 2017

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EDITOR’S NOTE

Hurricane Harvey, Oil Market Rebalancing and the African Offshore Play The whole World woke up on Friday 25th August 2017 to find the US State of Texas engulfed in a category 4 Hurricane Harvey. The Catastrophic storm has walloped Houston -- the epicenter of the nation's oil industry -- and the extent of the damage isn't yet known, but we do know that the U.S. refining capacity is now estimated at only 30%.

The region where the storm struck is home to some 2.2 million barrels per day (bpd) of refining capacity as well as being a major shipment point for both imports and exports of crude oil and fuel products. The refining capacity that has been idled because of the storm is about 11.2 percent of the U.S. total, and the immediate impact is being felt in gasoline prices.

Experts say the Hurricane Harvey may have achieved in global crude oil markets in a few days what OPEC and its allies have struggled to achieve in months - a tightening of supplies and a rise in prices. Crude oil prices rose slightly on Thursday, 31st August, contrary to the expectations of the Organisation of Petroleum Exporting Countries (OPEC), as oil traders focused more on Hurricane Harvey’s Harvey hit on oil demand than the impact on supply disruptions.

PUBLISHER/EDITOR-IN-CHIEF: Nneka Ezeemo EDITOR: Margaret Nongo-Okojokwu PRODUCTION: Chiamaka Umeh CORRESPONDENTS: Oge Obi (Lagos) Dirisu Yakubu (Associate Editor) Vivian Osuji Isreal (Head,South South Bureau,Port Harcourt) Jerome Onoja (Lagos) Gilbert Boyefio (Ghana Correspondent) Godspower Ike (Port Harcourt) Margaret Ahiakwo (Houston Texas, USA)

Meanwhile, lots of activities have been ongoing offshore Africa, the Organisation of Petroleum Exporting Country (OPEC)-led market rebalancing efforts are gradually beginning to yield positive results globally, and stalled oil and gas projects are currently being revived. In all these, the African oil and gas industry have been described by experts as a major destination for new investments and is expected to attract significant percentage of investible funds in the global oil and gas industry.

We explore the renewed activities arising from this effort and the attractiveness of Africa to investors .

Orient Energy Review also caught up with an Original Equipment Manufacturing company servicing the Oil, Gas and Power industries in Lagos Nigeria, - TRANOS. Mr Jude Abalaka, the MD/CEO gives us a hint into what makes his company tick.

There are other exciting stories inside, cutting across all sectors in the energy industry.

We welcome delegates attending the famous Offshore Europe and the Power Nigeria respectively. Grab a copy of our magazines Conferences holding in the UK and Nigeria respectivel for free at these events and more.

Our thoughts and prayers are with the victims of the Hurricane Harvey in Houston Texas.

Do enjoy the read and let us have your feed back

Margaret Nongo Okojokwu Editor, Mobile +234 8170334471 m.okojokwu@orientenergyreview.com

CONTENTS

GM Business Development D Jerome Onoja

5

INDUSTRY NEWS

Business Development Executive: Arit Asuquo Dan Ruth Muo (South Africa) Stanley Etim CREATIVE: DEE GRAPHICS CIRCULATION MANAGER : Ajayi Kayode CI LONDON OFFICE: Charity Place, Unit 1 Thurrock Pack Way Thurrock Parck Ind. Estate Tilbury,Essex Rm !87Hz. +447974199137 GHANA OFFICE: GHA +0243915206 orientenergyreviewgh@gmail.com ORIENT ENERGY REVIEW has emerged to be the platform and voice for the growing local content policy across the world.It is a monthly publication of Orient Magazine,Newspaper and Communications Limited 5, Dipo Dina Drive, Abule Oshun,Badagry Express Way Lagos www.orientenergyreview.com email: info@orientenergyreview.com

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......................................................

Hurricane Harvey Ratchets Up Pressure for OPEC to Rebalance the Market

POWER

Nigeria has gained 3,384 MW-USAID

24

COVER STORY

10

INTERVIEW

Offshore Africa: Exploring the Continent’s growing oil Sector in the Wake of Market Rebalancing

TRANOS, A True Manifestation of Local Content Drive in Nigeria

LOCAL CONTENT

31 GHANA REPORTS

Bui Power Authority Compensates Farmers Affected By Solar Project

8 16

Nigerian Content: Dangote Refinery to pick vendors from NOGIC Qualification System 30 Marginal Fields: NNPC Wants Local Oil Firms to Target 50% National Production

LOGITICS & MARITIME

Maritime Dev’t: Actionable Concepts Needed to Transform Potentials Into Opportunities - Transport Minister

38

Orient Energy Review Vol 6 No.08 September 2017 3

INDUSTRY NEWS

Hurricane Harvey Ratchets Up Pressure for OPEC to Rebalance the Market

H

istoric flooding in the U.S. state of Texas is likely to make it harder for the Organization of Petroleum Exporting Countries (OPEC) to succeed in its bid to rebalance the market, analysts at Barclays said in a research note.

Hurricane Harvey, which was later downgraded to a tropical storm, struck the coast of Texas on Friday causing widespread damage and flooding.

In the aftermath of what was the most powerful hurricane to hit a U.S. state in more than 50 years, several refineries in the Houston area were shut down while ports were closed to incoming and outgoing traffic.

Shares of Valero Energy, Phillips 66 and Marathon Petroleum all closed higher on Monday, on the back of news that several Houston-based refineries had been forced to halt production.

“In the coming weeks, we expect Hurricane Harvey’s impact to make it harder for OPEC to rebalance the market and maintain bullish sentiment,” Barclays’ analysts said.

“Disruptions to refineries, production and trade will also make the weekly Energy Information Administration (EIA) data even noisier and less useful as a high frequency indicator at the

4 Orient Energy Review Vol 6 No.08 September 2017

very time OPEC needs it most,” they added.

OPEC, Russia and other leading producers are slashing output by around 1.8 million barrels per day through to March 2018 in order to clear a supply overhang and support prices. OPEC and non-OPEC ministers are scheduled to meet on September 22 to discuss a possible extension to the cuts.

The refining capacity that has been idled by the storm is estimated to be about 11.2 percent of the U.S. total, according to a Reuter’s report, while the initial impact appears to be felt in gasoline prices.

Benchmark U.S. gasoline futures were little changed on Tuesday, having surged almost 7 percent on Monday to reach $1.7799 a gallon.

Amrita Sen, chief oil analyst at Energy Aspects, told CNBC on Tuesday that the U.S. had suffered a “huge” loss in oil output in the wake of tropical storm Harvey.

“On our estimates, it is about 36 percent of U.S. Gulf Coast refining.

That is well over 3.5 million barrels per day because not only are refineries shut; there are also refineries that are operating at reduced rates,” Sen said.

“Unlike in the past, say in 2008 when the last hurricane hit, (the U.S.) is now an exporter of oil products. This

has huge ramifications for the global products market and that is why you have seen all products really rise very sharply,” she added.

Brent crude, the global oil benchmark, was trading slightly higher at $51.99 in early morning deals on Tuesday.

Rick Joswick, managing director for oil with the PIRA Energy Group, a unit of S&P Global Platts, told CNBC that U.S. Gulf oil product prices would continue to spike for the time-being.

“In previous storms, including Katrina, Rita, Gustav, Ike, and Isaac, gasoline prices peaked within 2 weeks after landfall at a level 20-80 cents/gallon higher than before the storm hit.

But prices always declined rapidly and were back to the same level or below pre-storm values within 2-4 weeks,” he explained via email.

“PIRA’s outlook is for gasoline prices to spike by a similar degree for the next week or so. After then, prices will decline, but more slowly than in prior outages due to the increased pull by regional importers which is much higher now than back during the prior storms,” Joswick added.

Courtesy: cnbc.com

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INDUSTRY NEWS

Major Shake-Up In NNPC; 55 Top Officials Affected …As Roland Ewubare becomes New Head of NAPIMS

A

s part of the ongoing restructuring of the Nigerian National Petroleum Corporation, NNPC, 55 top management staff were either appointed or redeployed across the company’s operations in a major management shake-up announced on Tuesday, August 29th.

The Group Managing Director, GMD of the Corporation, Maikanti Baru, said the new appointments would not only help reposition the NNPC for the challenges ahead, but would also help to fill the gaps created due to statutory retirements of staff.

Under the new arrangement, Mr. Baru said a former Managing Director of the Integrated Data Services Limited, IDSL, Roland Ewubare, has been appointed the new Group General Manager, GGM, National Petroleum Investment Management Services, NAPIMS. Former GGM and Senior Technical Assistant, STA, to Mr. Baru, Diepriye Tariah, would take over from him as the MD of IDSL; while the Executive Director Operations of the Kaduna Refining and Petrochemical Company, KRPC, Malami Shehu, was appointed Managing Director, Port Harcourt Refining Company, PHRC. A former MD of the Warri Refining and Petrochemical Company, WRPC, Adewale Ladenegan, was moved to KRPC to assume duty as MD. Also affected was Muhammed Abah, who until recently was the

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Executive Director (Operations) of WRPC succeeds. He will take over from Mr. Ladenegan as MD of Warri Refinery.

At the Nigerian Products Marketing Company, NPMC, former GGM in charge of Corporate Planning and Strategy, CP&S, Umar Ajiya, was named the MD following the recent retirement of Farouk Ahmed from service. Also, a former General Manager, Downstream, GMD’s Office, Bala Wunti, takes charge as GGM CP&S. Other changes include Usman Yusuf who takes over as GGM/STA to the GMD; Adeyemi Adetunji as MD NNPC Retail, and Bola Afolabi as GGM in charge of Research and Development Division of the Corporation.

Mrs. Ahmadu-Katagum was also appointed GGM (Shipping) in the Downstream Autonomous Business Unit, ABU, while Kallamu Abdullahi takes over as the GGM in charge of the Renewable Energy Division in the Downstream ABU. Also, Shaibu Musa was promoted MD of the NNPC Medical Services Limited, while Ibrahim Birma is the new GGM in charge of the Corporation’s Audit Division, now renamed Governance, Risk and Compliance Division.

The spokesperson of the NNPC, Ndu Ughamadu, said all the appointments and redeployments, which have been approved by President Muhammadu Buhari, take immediate effect.

Total Becomes Second-Largest Producer in North Sea

F

rench oil major Total is now the second-largest producer in the North Sea after it overtook Royal Dutch Shell.

This follows the French oil company’s acquisition of Maersk’s Norwegian and UK producing assets.

The $7.45 billion deal by Total was welcomed by the market, with analysts saying it helped the French company rebalance its portfolio by adding assets in developed countries after going for projects in riskier places such as Iran and Russia.

The deal boosts the share of eight global oil majors in the North Sea – Statoil, Total, Shell, Exxon Mobil, Conoco, ENI Several oil majors have been actively looking to divest fields in the North Sea – one of the most mature global oil provinces where future developments will be complicated by high decommissioning costs of old infrastructure.

Some assets have been bought by private equity firms which have expanded significantly in the region, with companies such as Chrysaor and Siccar acquiring fields from Shell, Austria’s OMV and France’s Engie.

But despite around $10 billion worth of deals in the North Sea over the past two years, private equity firms remain fairly small players with their total share still below 10 percent

Orient Energy Review Vol 6 No.08 September 2017 5

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INDUSTRY NEWS

Azuri Technology, NDPHC Unveil PayGo Solar System

A

zuri Technology in partnership with the Niger Delta Power Holding Company (NDPHC), has launched its PayGo Solar Home Systems in Nigeria, to deliver affordable, clean energy to 20,000 rural households living without electricity, The Guardian reports.

Under Nigeria’s Renewable Energy Policy, the government aims to increase power generation from renewable energy sources from 13 per cent in 2015 to 23 per cent in 2025 and 36 per cent in 2030.

Azuri’s PayGo Solar Home systems have the capacity to power four LED bulbs providing up to eight hours of lighting, a radio and a USB port with charging cables for mobile phones.

Customers pay a monthly top-up rate via mobile money for 36 months after which time the unit can be unlocked and the customer owns the unit.

The deployment of 20,000 Azuri solar home systems is expected to create 500 direct jobs, including solar installer and agents and 5,000 indirect jobs.

Small businesses will be able to stay open for longer hours after sunset, students can continue their studies in the evening, and off-grid families can charge phones or listen to radios in their own homes.

Azuri has carried out successful pilots within several communities in Abuja, Kwara, and Osun states, installing nearly 200 solar home systems, just as the launch of the Azuri Quad system, last year, has helped

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Kachikwu Gives Mid-Term Report, Says Petrol Prices Likely To Fall

boost the country’s economy, which fell into recession in 2016.

The General Manager, West African region, Azuri Technology, Vera Nwanze, said the PayGo solar system has made it possible for students in Nigeria’s rural areas to study at night, and excelling in schools, while the system has also helped parents save money as well as reduce the health hazards associated with kerosene explosions and others.

Explaining what makes Azuri Technologies different from other brands already in the market, Nwanze said the Azuri Quad is simple to install with all components provided.

The company’s Vice President, Market Development, Paul Foster, who also addressed the media yesterday, disclosed that subscribers could have their battery box (Azuri Quad) changed if found to be faulty.

He assured Nigerians that they can never regret obtaining the solar system from company because it is made from high quality and due diligence.

The Managing Director/Chief Executive Officer, NDPHC, Chiedu Ugbo, had said during the flag off the scheme early this year that NDPHC is actively involved in the presidential initiative on rural solar home lighting systems, where 20,000 units of solar home systems are being deployed in under-served rural areas with no access to grid electricity supply.

B

ased on what was described as the competition inherent in the Premium Motor Spirit (PMS) price modulation, the Minister of State for Petroleum Resources, Ibe Kachikwu yesterday, made a prediction of cheap petrol in the nearest future.

He said the price of diesel, which is now 40 per cent down amid surplus supply, was enough evidence that petrol prices will also crash. Petrol is N145 per litre.

Presenting his scorecard in his two years in office in a podcast released to reporters in Abuja, Kachikwu said that “once Nigerians throw their trading skill in it, once competition thrives, the prices will continue to tumble.

“My guess is that you will see the prices tumble in the next four, five to six months. The market will be more stable and definitely, the prices will be lower than what we see today.”

Kachikwu said, “I know that a lot of you watched as we moved price from N86.50; you to N145 were screaming where we were heading?”

He said the government had no money from crude oil following the reduction in production as the militants were on the rampage.

The minister said, “The reality was that we did have the barrel to throw at it; we didn’t have the refineries. The Federal Government was bleeding. The production today is about 1.4 because the militants’ attack had taken away about 800,000 barrels per day. Once you do not have the barrel, the foreign exchange does not come in.

“So foreign exchange was depleting and the question was what did we do with the foreign exchange we had.

“And the President made the right choice to leave what we have intact so that we do not run into a state of bankruptcy. The only option we had was to create a liberalised environment so that people can bring in their products, source their money from secondary markets, charge the right price, which they would not do unless the price was high. Fellow Nigerians, we were left with no option than what we did.”

According to Kachikwu, the refineries were not working but as soon as the government was able to revamp, the 445 barrels per day was sent to the refineries. *Ynaija.com

Orient Energy Review Vol 6 No.08 September 2017 7

INTERVIEW

TRANOS, A True Manifestation of Local Content Drive in Nigeria “At Tranos , we see quality as systemic, as well as an integrated process” How long have you been in business?

T

RANOS, an indigenous engineering and technology company is a true representation of Local Content drive in Nigeria. With a wide range of technical and engineering competencies, it provides innovative and diversified solutions to different sectors, ranging from oil and gas, power and energy to telecoms, among others. In this interview with OER’s Jerome Onoja, the Managing Director, Mr Jude Abalaka, says that Tranos has, through its drive for excellence, maintained high standards in building power generator enclosures, skids and packages, providing energy distribution, control and automation systems and is set to go international by supplying other African countries and the Middle East as it takes off to the global market. Excerpts Tell us about Tranos?

Tranos is a wholly Nigerian-owned, technology company focused on improving lives through innovative solutions. We prefer to use the word ‘technology’ to describe our work because we have a number of technical engineering competencies which we use in serving different companies. So, our clients vary from sector to sector, and from industry to industry. We try to use technology to solve their unique problems.

8 Orient Energy Review Vol 6 No.08 September 2017

Tranos was incorporated in 2008. By next year, we will be 10 years in business. Our initial focus was to service the Oil and Gas industry both in equipment supply and fabrication services. We did that for a while and then realized that opportunities existed in other markets.

From about 2010, we started investing in equipment as a deliberate move to end sub-contracting jobs to foreign companies. We started doing this before the NOGICD Act was enacted.

For us as a company it made a lot of economic sense to have more control over what we were doing than waiting for foreign companies. In the course of time, we discovered that, what we were doing could benefit other sectors of the economy as well. So, we started attracting customers from the telecoms, building industry and in that same way, our business began to grow.

Is Tranos an extension of a foreign company trying to make in-road into the Nigerian market?

No, no, no! We are a Nigerian company making our way into the international market.

How do you source your raw materials and component

parts?

It depends. Most of the time, the bulk of them are sourced locally. A lot of the mechanical things we produce like enclosures,are largely made of local steel.

We have a good local company called WEMPCO, they make cold roll steel. For the hotroll steel materials, we buy from local suppliers. We also buy electrical cables from Kabelmetal and Coleman.The materials we import are mostly accessories, some of the consumables and the component parts that do not have local suppliers.

What standards and certifications do you use in your processes?

We are ISO 9001: 2008 certified. We are currently working on upgrading to 2015.

For us ISO is like the entry level with regards to quality because we don’t see quality as something that applies to clients alone. We see quality as systemic, as well as an integrated process. If we have a good quality system, it will also impact on our operations. So, we approach our operational systems from the perspective of guaranty for good quality such that quality doesn’t just happen because someone found out through an inspection,

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INTERVIEW but we arebuilding a system where we have everything in place, so that all our processes and outcomes are guaranteed.So, ISO 9001 stands as ourentry level requirement as we build operational excellence and a lean production system on top of that. By so doing, we kill two birds with one stone; because, besides assurance of good quality, we eliminate rework, reduce cost of production and optimize production.

Are you a member of any regulatory professional engineering body in Nigeria?

We are members of Nigerian Society of Engineers, Manufacturers Association of Nigeria andof course, we have our valid DPR and other regulatory requirements in place as well.

What has been your driving force?

Our target is excellence. From the onset, it has always been our goal to attain excellence in everything we do.

We are not just trying to be the best in Nigeria at what we do, we want to be the best or at least among the best anywhere in the world.

For us, the driving force is being able to benchmark ourselves and say, ‘when compared to other companies that do what we do in the world, are we among the best?’. Going back to our operational processes, we have learnt and taught ourselves to look at quality and efficiency in a particular way. We have learnt what constitutes waste in an operational system and we have started to eliminate them one by one. So, what drives us is the pursuit of excellence and perfection.

You have a great team; what is yourpolicy in recruiting engineers?

That is an question. look is

interesting What we at most of the time will-

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ingness to learn. We have our basic entrance tests and interviews too, but as a knowledge-based organization we look for people who are hungry for knowledge and willing to learn.

We have discovered that it is difficult to find ready-made candidates because of the cutting-edge technologies we use. The younger engineers tend to be much more eager to learn, so we like that in the people we recruit. With our core values in mind, we seek people who can easily fit in.

Have you identified upcoming projects for which you have capacity and believe such opportunities could help Tranos retain Forex which ordinarily would be spent on importation?

Yes. We know for example there is Zabazaba Project coming up which we hope to get involved in. There is also the Bonga South West Project. On these projects, there are opportunities for the provision of electrical and mechanical systems andmodules, like rotating equipment packages for pumping, power generation and compression. The EPC contractors and other OEMs can look inwards instead of seeking for foreign subcontractors.

We can also provide power distribution and control systems packages too. These are usually subcontracted by the main EPC contractors. Typically, the subcontractor will import all the components and assemble locally, but in our own case asyou have seen from our facility, we can actually build all the enclosures tofit the exact size that is needed on the FPSOs. Can you highlight some projects Tranos has done?

In the oil and gas industry, we worked on the Chevron Firewater system and their sewage treatment plant upgrade. We did some work on the USAN FPSO for the Essential and Emergency power generators too. A lot of the other things we have done in the oil industry are in subcontracting roles; we worked as subcontractor for delivering water treatment plants for Shell, we carried out numerous offshore fabrication, installation and repair work on Mobil’s OCIPII program during which time we fabricated a cofferdam for the

project. Recently, we fabricated a 12-ton pipe clamp for a 48-inch pipeline repair for Hydrodive/Shell.

In the power sector, we have a couple of multi-nationalsfor whom we aretier-one suppliers, and we produce various steel enclosures for generator soundproofing, compact substations and power distribution. We have designed and produced specialized hybrid power systems for telecoms base stations, we have thousands of this powering base stations across the country.

What are Tranos future plans to collaborate with some of our tertiary institutions in respect of knowledge transfer, given that you have a lot of domesticated but unique technologies in use here?

Knowledge is important to us and working with educationalinstitutions is a key thing we have in mind,but we are seeking the best approach.

We have relationships with a couple of institutions like the Institute of Industrial Technology (IIT) who we have worked with on a couple of things. And because they train graduates; we also recruit some of their trainees. We have done a few things with UNILAG; we sponsored a research project in their mechanical engineering department.

What challenges have you faced as a young company and how have you handled them?

Getting the right personnel is one, especially as we are growing because a lot ofyoung engineers have little applicable technical knowledge. We couldn’t find people with the experience we required. We solved it by organizing a lot of in-house training, bringing in trainers, and sending some people abroad.

Another challenge is the supply chain; the struggles of bringing in things into Nigeria like machinery and some of the accessories and consumables we need. It is always a challenge because of the cumbersome process of importing and clearing goods. Financing can at times be a challenge too.

You are an Original Equipment Manufacturer; tell us about some products you manufactured in recent times?

We have the telecoms power solution. It is a hybrid power system that connects a special DC diesel

Orient Energy Review Vol 6 No.08 September 2017 9

Our Capabilities

12

Design

Our Capabilities Design At TRANOS, we take pride inour ability to design all products and fabricated materials from scratch.

The advantage TRANOS has over other companies is our in-house research, development and design capabilities. These allowus to o er customized products to customers. Our Design Engineers make use of amixture of several computer-aided design software to bring conception to every idea. We make use of the Autodesk Product suite: Autodesk Inventor, AutoCAD, as well as other design software like META LLIX, DR. ABEand the proprietary software of some of the machines. We also make use of our 3DPrinter for advanced prototyping to

Welding and Fabrication

Sheet Metal Fabrication what guide our work at TRANOS. Powder Coating , Painting & Finishing We have invested in state of the art e quipment and operated by highly skilled and well trained operators.

Our fabrication process at TRANOS involves acombination of cutting, bending, and joining procedures.

Our facilities are equipped with ultra-modern machines that give us an edge in precision fabrication and manufacturing. Some of these machines include:

Precision CNC Cut ting &Punching • • •

Electrical & Mechanical Assembly • •

ARCADE21 2PUNCHINGMACHINE AMADA AE251 0NTTURRETPUNCHINGMACHINE LINCOLNELECTRIC BURNY 1 0LCD WI THHYPERTHERM MAXPRO200CUTTINGSYSTEM AMADA LCG301 5LASERCUTTINGMACHINE LINCOLNELECTRIC PHANTOMST WI THTHESPIRITII 400 PLASMA CUTTINGMACHINE

These are used for precision cutting and punching. We are able to precisely cut complex shapes from 0.5mm to 50mm.

Insert picture of red area (You can insert picture of machines, but I think what would be more interesting are pictures o f things fabricated or being fabricated by the machines.

TRANOS

| Cor porate broch ure

• OurCapabilities

10 Orient Energy Review Vol 6 No.08 September 2017

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POWER

Schneider Electric to Aid Dangote Refinery On Safety, Reliability & Profitability With Iot Solutions

S

chneider Electric, the global specialist in energy management and automation, has signed a contract to provide comprehensive process automation systems, solutions and services to Dangote Oil Refinery Ltd., a subsidiary of African business conglomerate Dangote Group.

Under the terms of the agreement, Schneider Electric will supply its EcoStruxure system architecture and platform, comprising its EcoStruxure Foxboro distributed control system, Triconex process safety solutions, PIONIR analytical fuels blending systems and a suite of SimSci and Wonderware software solutions, including its unified supply chain management and operations management software, to drive supply chain and operational efficiency, reliability and profitability improvements at Dangote’s greenfield refinery in Lagos, Nigeria.

EcoStruxure is Schneider Electric’s IoT-enabled, open and interoperable system architecture and platform that deliver Innovation At Every Level across connected products, edge control and apps, analytics, and services. The EcoStruxure architecture enables scalable design and operation of connected systems with best-in-class cybersecurity built in at every layer.

Meeting Demand “While Nigeria is the world’s eighth largest producer and exporter of crude oil, we still import nearly 80 percent of our petroleum products,” said Devakumar V. G. Edwin, group executive director, strategy, capital projects and portfolio development, Dangote Industries Ltd. “Once completed in 2019, however, the Dangote Refinery will be the world’s largest single train refinery capable of producing 33 million tons of various liquid products, including gasoline, diesel, kerosene, aviation fuel and other petrochemicals every year. Not only is that enough to meet all of Nigeria’s consumption needs each and every day, we will have a surplus of each of these

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products for export.”

Because it will be a single train facility, any interruption or shutdown in operations at the Dangote Refinery would decrease output from 650,000 barrels a day to zero. Recognizing the need to safeguard their continuous operations, Dangote Oil Refinery Ltd. chose Schneider Electric’s EcoStruxure Foxboro DCS and Triconex process safety solutions— which include emergency shutdown systems—to maximize the safety and efficiency of their operations and to improve the reliability of their equipment assets and asset sets. PIONIR process analyzers will improve process optimization, asset protection and compliance with environmental regulations. And advanced SimSci and Wonderware software will be implemented both to unify planning and scheduling and to improve real-time data collection and analysis, further optimizing operations and product blending.

When combined, the integrated suite of systems and software solutions will help the Dangote Refinery gain better real-time control of all its business variables, including the safety, reliability, efficiency and profitability of its operations.

Value-focused IIoT Technology = Real-time Safety, Efficiency, Reliability and Profitability Control “Maintaining continuously safe, reliable and efficient refinery operations will help us reach our national goal of reducing petroleum products imports and increasing our energy independence, which could help increase our country’s foreign exchange by up to $5.5 million and reduce oil imports by up to $7.5 million,” Edwin said.

To ensure its refinery continually runs smoothly and at full capacity, Dangote Oil Refinery Ltd. sought high-end solutions that both mitigate risks and hazards and prevent unscheduled downtime.

“Through its Foxboro and Triconex systems, PIONIR process analyzers and market-leading SimSci and Wonderware software brands,

Schneider Electric has a longstanding reputation for delivering reliable, value-focused technology solutions.

Their strong track record gives us confidence in their ability to help the Dangote Refinery achieve exceptional levels of real-time operational safety, efficiency, reliability and, of course, profitability. This will translate into more value for the refinery and more value for Nigeria’s economy,” said Edwin.

As part of the agreement, Schneider Electric has created a task force between its Nigerian office and its engineering office in India, which has successfully implemented critical control and safety systems for some of the largest refineries in the world. This level of experience and expertise, coupled with Schneider Electric’s commitment to providing local support, made the company Dangote’s top choice. Schneider Electric will also provide design, engineering and installation services, not only ensuring a successful implementation from start to finish, but ensuring the workforce is equipped with the tools they need to positively impact business performance.

“Today’s industrial operations are facing two critical challenges: the increasing speed of business and the pace of technology changes, particularly in the day of IIoT,” said John Eva, senior vice president, global engineering, procurement and construction, Schneider Electric.

“To help Dangote address these challenges, we are delivering and implementing value-focused technology solutions—innovation at every level—so they can move from managing their performance and business results to actually controlling them, in real time.”

For more details and information about Schneider Electric’s process automation systems and solutions, please visit the company’s EcoStruxure Plant webpage.

Orient Energy Review Vol 6 No.08 September 2017 11

POWER

Nigeria has gained 3,384 MW-USAID …As DisCos reject 9, 310 MW in a week Dirisu Yakubu with agency report

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igeria has gained 3,384 megawatts of electricity from Power Africa’s financial closure, an initiative of the United States Agency for International Development (USAID), aimed at increasing power generation in sub-Saharan Africa.

This amount of represents 47 per cent of the 7,200MW total installed electricity it is expected to achieve in the African continent before the end of 2017.

In its 2017 annual report, the agency said it achieved this through Public-Private Partnership arrangement and had mobilized more than $54bn in commitment from more than 140 partners.

The agency listed the Omoka Independent Power Project, Elema IPP, Afam, Azura and other privatized general assets as some of the projects in Nigeria it had helped to mobilize funds for.

Findings by Orient Energy Review (OER) show that The Power Africa initiative has assisted the Port Harcourt Electricity Distribution Company to increase its revenue collection with metering technology that can be used to analyze customer energy use and improve efficiency in energy distribution.

It has also provided support for Eko, Ikeja and Benin Discos, through the modernization of their networks and identification of ways to increase collections.

According to the report, this development has reduced commercial losses that are a huge challenge to the survival of these

utility distribution companies in the last couple of years.

“In Nigeria, the USAID initiative has helped four distribution companies reduce commercial and technical losses by up to 17.6 per cent and increase revenue collection by up to 33 per cent, improving their financial viability and introducing the US technology to improve system reliability,” it added.

In June 2013, Power Africa launched with the goal of doubling access to electricity in sub-Saharan Africa by increasing installed generation capacity by 30,000MW while adding 60 million new household and business connections by 2030.

In February 2016, the US Congress passed the Electrify Africa Act of 2015, which charges Power Africa with increasing installed generation capacity by 20,000MW. The United States Coordinator for Power Africa, Andrew Herscowitz, said, “Over the next year, Power Africa will work with more than 100 US companies, our African partners, other donors, and the private sector to harness the technology, ingenuity, and political will to bring the benefits of modern energy to even the remotest African village and promote economic growth across the African continent.

“Our intent is to expand beyond our initial focus on solar lanterns and renewable energy to support more on-grid power projects in natural gas and other sources, as our funding allows.

“This year, Power Africa facilitated the first-ever African pension fund investment in an African power generation company — mobilizing more than $23m of African capital from one country to invest in another African country’s development.”

Meanwhile, 11 electricity distribution companies (Discos) in the country rejected 9,310.64 megawatts (MW) of electricity from the generation companies (GenCos) in the past one week because their distribution facilities could not take up all the electricity, records from the Transmission Company of Nigeria (TCN) have shown.

The Discos, according to a summary of the daily load allocation between August 13 and 20, rejected an average of

12 Orient Energy Review Vol 6 No.08 September 2017

1,163.83MW daily, with the rejection coming mostly from Ibadan, Benin, Abuja, Eko and Ikeja Discos.

TCN equally indicated that despite the slight rise in power generation – an average of 3613.85MW – during the period and huge demand for electricity by consumers, the Discos could not take up the entire load allocated to them in line with the Multi-year Tariff Order (MYTO) sharing model.

It showed that in the eight-day period, the Discos collectively rejected 983.6MW, 1,062.11MW, 1,802.1MW, 1,506.03MW, 1,581.36MW, 701.31MW, 629.94MW, and 1,044.03MW respectively.

Similarly, another report on the sector’s performance within the week, which the Advisory Power Team in the Office of the Vice-President shared, showed that most of the Discos have continued to experience challenges with their networks.

The advisory team’s report linked the poor distribution capacities of the Discos to the frequent outages at their feeders.

Recently, records from the Manufacturers Association of Nigeria (MAN) indicated that due to poor power supply from the Discos, Nigerian manufacturers spent N66.99 billion on generators and alternative energy sources to power their factories in the second half of 2016.

MAN said in its review of the operational activities of its members within the period that daily power supply to them averaged eight hours and outage four times, hence its expenditure on alternative energy sources in the period increased to N66.99 billion, from N29.48 billion expended in the corresponding period of 2015, representing a N37.51 billion increase.

Only recently at the last power sector operators’ monthly meeting in Kano, the Minister of Power, Works, and Housing, Mr. Babatunde Fashola, revealed that Nigeria currently has up to 6,863MW of electricity that can be wheeled out to homes and industries in the country, but cannot send all of it to consumers because the distribution facilities of the Discos were poor and unable to evacuate all of the generated power.

Fashola explained that due to improvements in gas supply to thermal power plants in the south and adequate rains in the reservoirs of the hydro plants in the north, the country could conveniently generate 6,863MW and transmit 6,700MW of it, but the electricity could not get to consumers because the 33KV infrastructure of the Discos was constrained.

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Nigerian Govt approves $5.792bn for 3,050MW Mambilla hydro project, 45 Years after

POWER

Zungeru Hydropower Plant At 47% Completion – CNEEC

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he Federal Executive Council, FEC, presided over by President Muhammadu Buhari, approved $5.792 billion (about N1.140 trillion) for the construction of the 3,050 megawatts Mambilla Hydro-Power project at Gembu in Taraba State.

The Minister of Power, Works and Housing, Mr. Babatunde Fashola, disclosed this on Wednesday while addressing State House correspondents alongside the ministers of labour and employment as well as the minister of sports, on the outcome of the Council’s meeting.

He said, “The memorandum from the Ministry of Power, Works and Housing was to the award of the Mambilla Hydro-Power plant. I believe that many of you have heard of this project. Nigeria started talking about it since 1972; that is about 45 years ago.

“Several efforts had been made to bring it to reality but I’m happy to announce that this government approved the contract today to joint ventures of Chinese Civil and Engineering Company for the engineering and turn-key contract, including civil and electro-mechanical works for $5.792 billion.

“The construction should take about 72 months (6 years),” he added.

According to Fashola, the scope of works of the project will include the construction of four dams and 700 kilometres of transmission lines.

The minister said the project, when completed, would boost the nation’s economy as it would unleash the potential that had been reported about Mambilla in the fields of agriculture, tourism and energy.

“It will also help Nigeria strike a very big blow on the climate change issue and fulfil its commitment under the Paris Climate Agreement, because this is going to be renewable energy, coming also at a relatively competitive cost.”

Mr. Fashola said the project would be jointly financed by the federal government and the China Export Import, EXIM, Bank.

EXIM bank will provide 85 per cent of the cost while the federal government would provide 15 per cent.

Meanwhile, the Minister of Labour and Employment, Dr. Chris Ngige, explained that the council approved Boiler and Pressure Vessel Regulation to ensure industrial safety in the country.

He said the approval was in line with international best practices to safeguard lives and property in the industrial sector of the nation’s economy.

www.orientenergyreview.com

T

he China National Electric Engineering Company (CNEEC) Has Disclosed That The Zungeru 700mw Hydroelectric Power Plant In Niger State Is At 47 Per Cent Completion Stage, The Punch Reports.

The Deputy Project Manager, Mr. Xiao Nie, Told Journalists On A Tour Of The Project On Wednesday That The $1.29bn (About N473bn) Project Was Expected To Be Completed In 2020. He Explained That The Project Was Made Up Of Four Units Of 175 Mw Each, Adding However, That The First Phase Would Be Released By December

2019 While The Remaining Would Be Released After Every Three Months.

He Said That The Project Which Was Inaugurated In 2013 Was Initially Expected To Be Completed In 2019 But was Delayed

By Unresolved Issues With The Host Communities. Nie Explained That When Completed, The 700MW Power Plant Would Supply 2,640gwh To The National Grid Annually. He Said That The Zungeru Plant Was Expected To Improve Electricity Supply And Boost Industrial Development In The Country.

Oil Marketers Threaten Mass Retrenchment over N720b Subsidy Arrears Except the Federal Government pays all petroleum subsidy arrears of over $2 billion (N720 billion) owed oil marketers, many employees in the downstream sector may soon be thrown into the labour market, The Guardian reports.

Already, the oil marketers who operate under the aegis of Major Oil Marketers Association of Nigeria (MOMAN); Independent Petroleum Marketers Association of Nigeria (IPMAN); Depot and Petroleum Products Marketers Association (DAPPMA); and Independent Petroleum Products Importers (IPPIs), have disclosed plans to embark on mass retrenchment of workers as government fails to pay the outstanding subsidy owed on the importation of petroleum products, accrued interest on loans from banks and exchange rate differential.

The government’s delay in the payment of the over N720 billion debt has made marketers to halt the importation of petrol, leaving the Nigerian National Petroleum Corporation (NNPC) to become the sole importer of the essential commodity. The marketers said as a result of the non-payment of interest and foreign exchange differentials, they had gradually become financially handicapped to continue operating profitably. They added that government’s delay in settling all the debts was threatening massive investment in the downstream sector.

Orient Energy Review Vol 6 No.08 September 2017 13

FINANCING ENERGY

FG Launches $200m Fund to Help Indigenous Oil & Gas Firms government drive to improve access to low-cost credit across the economy, Reuters reports.

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igeria’s oil minister said the government launched a fund on Thursday with an initial value of $200 million to support local oil and gas firms, part of a

The Nigerian Content Development Fund (NCDF) would be financed through allocating the fund one percent of the value of all contracts awarded in the staterun upstream oil and gas industry, the Petroleum Ministry said. The new fund would offer finance to

energy firms setting up manufacturing facilities or acquiring assets such as oil rigs, ministry officials said. It would also offer project financing and help refinance existing loans, they said.

“I would like to see this fund going to cutting edge, tech-driven businesses,” Minister of State for Petroleum Emmanuel Kachikwu told an event in the capital Abuja to launch the fund. The goal was to increase the size of the fund to $1 billion, he said, without giving a timeframe.

The Nigerian Content Development and Monitoring Board (NCDMB) would manage the fund alongside the state-run Bank of Industry, officials said. *Reuters

Mozambique Sets Sights on Capital Gains Tax from ENI, Exxon Deal Maleiane said in a news bulletin on Mozambique’s local TV.

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ozambique will charge Italian energy company ENI $350 million in capital gains tax for its sale of a stake in the Coral South natural gas field to ExxonMobil, the nation’s finance minister said on local television on Tuesday, August 29th.

14 Orient Energy Review Vol 6 No.08 September 2017

Mozambique’s government plans to set up a sovereign investment fund where taxes received on sales of the country’s minerals will be used to finance development projects, state media reported earlier this month.

The government has authorised the asset sale and the tax authorities can now collect the tax, Minister of Economy and Finance Adriano

“The state has already done what had to be done. Officials from outside the country must close, and from there they have a deadline of 30 days to bring the funds here to Mozambique. Before the end of the year is the probable deadline,”said Maleiane.

In June, ENI signed an $8 billion deal with the government to develop a gas field off the coast of Mozambique, the first of a series of projects that could transform the poor African nation into a major energy supplier to Asia.

The Coral South field operated by ENI contains about 450 billion cubic metres or 16 trillion cubic feet (tcf) of gas.

Exxon Mobil Corp agreed this year to pay Eni $2.8 billion for a 25 percent stake in Coral South.

Source: Reuters www.orientenergyreview.com

FINANCING ENERGY

Greenwish to Invest $800m on Solar Powered Telecom Towers across Africa

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reenWish Partners, a renewable energy company run by a former Morgan Stanley executive, is planning to invest $800 million on solar-powered telecommunications towers across Africa, Bloomberg reports.

“We reduce the total cost of power by 30%,” said Charlotte Aubin-Kalaidjian, the founder and chief executive officer of GreenWish, who was formerly a managing director at Morgan Stanley Investment Management. “Smaller towers can run entirely on solar and battery and larger ones reduce their diesel use by at least 60%.”

Africa has more than 240,000 telecom towers, which convey signals to and from mobile phones. Most of them are powered by diesel genera-

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Expert Gives Reasons Why Nigeria Lacks Major Waste-To-Power Investment

tors because they’re often attached to unreliable grids or in remote areas without power network access.

The hybrid systems developed by GreenWish combine a solar panel, a battery and a diesel generator to provide complete off-grid reliability.

Mauritius-based Greenwish has partnered with Orange SA and will begin with 250 towers in the Democratic Republic of Congo this year.

It’s aiming to reach 3,000 towers across several countries by 2018 and 10,000 by 2020. Aubin-Kalaidjian said Greenwish is in discussions with other telecommunication companies in Africa and expects to extend its partnership with Orange beyond the DRC, moving into other markets such as Nigeria, Senegal, Egypt and Ivory Coast.

A waste-to-power project finance specialist, Fatima Ademoh, has disclosed that for many reasons, Nigeria may not see major investments in waste-to-power generation soon despite its huge waste resources.

Ademoh, who is currently developing an embedded waste-to-power plant in the Kuje part of Abuja, Nigeria stated at the August edition of the monthly power dialogue of the Nextier Advisory, that Nigeria’s unique but untapped advantage in waste-to-power generation could remain latent unless a proper policy on waste management was enacted by the government to create the kind of buzz needed to set off the value chain.

Ademoh, also identified poor awareness; funding; and non-existent in-country capacity for waste-topower projects as some of the key challenges that have kept the sector from taking off. She explained that a policy that would support proper waste management and guarantee consistent feedstock to power plants was needed in Nigeria, adding that private funders would look at the sector only when it has the right policies to support their investments.

Orient Energy Review Vol 6 No.08 September 2017 15

FINANCING ENERGY

Banks Cannot Provide for Power Sector Loans Because It’s Systemically Important - Wigwe

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he Group Managing Director and Chief Executive Officer of Access Bank Plc, Mr. Herbert Wigwe, has explained why Nigerian banks have still not made provisions for most of the power sector loans, despite the fact that most of the loans taken by investors who bought up the federal government’s assets in the electricity sector almost four years had defaulted on their loan repayments.

He said if the banks were to make impairment charges on the loans it would be counterproductive, as the power sector was systemically important and critical to the growth of the Nigerian economy.

Wigwe, who said this during an interview on ARISE News Channel, described the issues surrounding the power sector privatisation as very important and urged the federal government to look into the issues and create some form of reprieve for investors that had staked their funds in

the sector.

“There is a problem in that value chain and there is also a problem with the pricing of their product which everybody needs to look at. There is a problem in terms of access to gas also, so several little things need to be resolved.

“But this is not the first time it is happening. Remember in the 80s, the government had to step in and that was how the creation of prudential guidelines came up.

“I think the government needs to revisit that whole (power) sector in terms of the people who are exposed to that sector and create some form of reprieve for them

to work it out and for things to go right.

“That is because that sector is extremely important for the industrialisation of our country. But if you treat it otherwise, what you get is a collapse of that sector, which would be worse for all of us. So I think it needs to be managed and I believe the government should do that.

“You can’t tell the banks to provide for those loans right now. It is a very important issue and it is a national issue. It is a national issue because it is critical for our economy.

“And the banks that were sufficiently patriotic to support investments in power need to be given time to manage those exposures.

“Some of the problems that have come out of these exposures were actually not caused by the banks, but out of the fault in the implementation of the power policy.

“Now, having said that, there is also the issue of the systemic importance, relevance, and what you need to do about depositors’ funds,” he pointed out.

Lekoil Set for More Investment off Renaissance Capital Ratings

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ekoil may be set to attract the required funding to emerge as major oil and gas producer as a rating agency has given a green light to investors to invest in the indigenous oil firm, Orient Energy Review reports.

Renaissance Capital yesterday indicated that the high rating of the oil company was based on the ramp-up of commercial production at the Otakikpo field.

It said this in a mes-

16 Orient Energy Review Vol 6 No.08 September 2017

sage to investors and other stakeholders.

Renaissance disclosed that it updated Lekoil estimates following the rampup of commercial production at the Otakikpo field and its expectation of phase 2 development in the first half of 2018. Renaissance indicated that it is now more optimistic, after seeing operational progress at both the Otakikpo and Ogo fields.

www.orientenergyreview.com

LOCAL CONTENT

30 Marginal Fields: NNPC Wants Local Oil Firms to Target 50% National Production Dirisu Yakubu, Abuja, FCT

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he Nigerian National Petroleum Corporation (NNPC) recently called on members of the Independent Petroleum Producers Group (IPPG) to participate in the forthcoming bid round for about 30 marginal oil fields which is set to be flagged off by the Federal Government.

Group Managing Director of the Corporation, Dr. Maikanti Baru, gave the charge recently while receiving a delegation of IPPG led by its chairman, Engr.

Ademola Adeyemi-Bero, at the NNPC Towers in Abuja, where he also urged them to take advantage of the low crude oil price regime to develop capacity and acquire relevant technology that would make them showcase their competence to the outside world.

Dr. Baru also charged the IPPG members to ramp up their collective production from 10 per cent of national production to fifty per cent in the next 10 years in order to increase the footprint of indigenous companies in the upstream sub-sector as is the case in the downstream and to demonstrate the depth of local content policy penetration in the oil and gas industry.

The NNPC boss stated that there were lots of opportunities in the marginal fields which would soon be available, urging the IPPG to work hand-in-hand with the Department of Petroleum Resources (DPR) to ensure that they meet the conditions that would be required from bidders.

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He said: “The marginal oil field lease renewal is an opportunity for your group.

You will need to engage the DPR early in discussion to find out the conditions that the Federal Government is interested in. For example, the supply of gas to power plants and fertilizer plants and I think your group will be successful.”

The NNPC helmsman said the corporation was passionate about collaborating with the indigenous producers in order to grow their capacity and participation in the exploration and production sub-sector in line with government’s local content policy.

In his words, the NNPC remain proud of indigenous oil companies and was looking forward to a time when about ninety per cent of upstream operations in the country would be controlled by them.

Dr. Baru, who applauded members of the group for their productive community engagement which had stemmed the incidence of pipeline sabotage along the Trans Forcados Pipeline, urged them to extend similar gesture to the communities around the other crude oil lines to help stabilize national production.

Chairman of the Group, Engineer Adeyemi-Bero, who made a presentation to the NNPC management, said the group was made up of twenty five active indigenous producers and driven by the passion to support the 12 Business Focus Areas of the current management of NNPC and the Seven Big Wins of the Federal Government. The Chairman praised the Federal Government for

initiating the Joint Venture cash call exit programme, adding that the move would bolster their activities in the upstream sub-sector.

However, Leonard Ngegu, Plant Manager of City Gas Nigeria Limited is doubtful of local firms’ability to make the most of the marginal oil fields even if they have their bids accepted by government. According to Ngegu, technical capacity is key to oil exploration and production, stressing that with the exception of a handful of indigenous companies doing business in the sector; only the multinationals have what it takes to do successful business “when the chips are down.”

Ngegu who is currently holidaying in Montreal, Canada told Orient Energy Review in a telephone conversation that though, the Nigerian Content Development and Monitoring Board (NCDMB) is doing a ‘fantastic job,’ the challenges of technology and skilled manpower could not be wish away with a wave of the hand.

“It is a good challenge from the NNPC but are we ready? Are the indigenous companies ready? Of course, local content is on our lips now but how many of these companies can take advantage of the marginal fields as thrown at them?” he asked.

Reminded that a good number of them have actually stood up to be counted in the recent time, the City Gas boss admitted progress has been made, insisting that there remains gaps to be filled.

“Things are getting better and I am aware we have competent local companies operating in the Nigerian oil and gas industry. The question however is: how many of those companies do we have?

Are you not surprised that days after the NNPC charged them to get ready; no company has stated its readiness? He asked rhetorically.

The IPPG was formed in 2016 with the mandate to promote and advance the collective interest of members in a coordinated manner as a unified advocacy platform for federal government policies in the upstream sub-sector of the oil and gas industry.

Orient Energy Review Vol 6 No.08 September 2017 17

LOCAL CONTENT

Chevron Trains 14 Young Nigerians To Acquire Oil, Gas Skills

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hevron Nigeria Limited (CNL), the operator of the NNPC/ CNL Joint Venture has completed a 12-month on-the-job-training of seven Nigerian graduates at CNL’s office and field locations. The training was part of CNL’s efforts to assist with building organizational capability in the oil and gas industry. This is the second batch of trainees that have gone through this programme and this batch makes it a total of 14 graduates who have benefitted from this outstanding internship programme since 2015.

The internship programme, which is in support of the Nigerian Content Human Capacity Development Initiative (NCHCDI), covered various disciplines, including earth science, reservoir management as well as drilling and completions. The programme was executed in partnership with the Nigerian Content Development and Monitoring Board (NCDMB). CNL has spent over N300 Million on the internship programme since its inception in 2015.

CNL was one of the operators in the oil and gas industry that heeded NCDMB’s call in 2014, to help provide on-the-job-learning and capacity building opportunities for Nigerian Earth Science graduates. The first batch of seven earth scientists completed their internship program

in 2015 and some of them were subsequently employed by companies in Nigeria and overseas.

The only female trainee in the team progressed into a role of higher responsibility in one of the Federal Government parastatals. Another trainee is currently undertaking a Ph.D programme in Engineering in an Ivy League university in the United States of America.

At the passing out ceremony for the second batch of seven beneficiaries, held recently at the NCDMB liaison office, Abuja, CNL’s Chairman and Managing Director, Mr. Jeffrey Ewing, commended the partnership between CNL and NCDMB, stating that the collaboration has been yielding positive results.

Mr. Ewing, who was represented at the event by Mr. Olusoga Oduselu, CNL’s General Manager, Nigerian Content Development, stated that “Chevron prides itself in building capacity in Nigeria and in Nigerians.

Our support for Nigerian Content development goes beyond the implementation of the provisions of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act.” He also congratulated the interns for successfully completing the 12 months’ internship.

Mr. Simbi Kesiye Wabote, NCDMB’s Executive Secretary, thanked CNL for its consistent support of the NCHCDI and other initiatives of NCDMB. In his words, “Chevron has been fantastic in its collaboration with the NCDMB, not only in the implementation of the NCHCDI program, but in other initiatives of the Board.”

Efe Akpovwovwo, one of the beneficiaries of the program, thanked CNL and NCDMB for the opportunity, saying it enabled him to acquire high level technical skills in the use of state-of-the-art technolo-

18 Orient Energy Review Vol 6 No.08 September 2017

gy in the oil and gas industry. In his words, “… the internship program in Chevron was an invaluable experience for me. Some of the skills I acquired in the technical area include well & seismic data interpretation, 3D Simple Petrel Earth Modelling, identification of workovers & infill drilling opportunities, use of Microsoft-Office software, well site drilling operations and inter-disciplinary understanding of reservoir management.” Mr. Akpovwovwo said the opportunity also enhanced his reporting, presentation, creativity and multi-tasking skills. In 2009, Star Deep Water Petroleum Limited (a Chevron Company and operator of the Agbami unit) and the other parties in the Agbami Unit, introduced the Agbami Medical and Engineering Professionals Scholarship (AMEPS).

The scholarship program was initially designed for undergraduates of Niger Delta origin, but was later extended to all eligible Nigerian undergraduates. AMEPS has helped to generate a strategic feed into the national health and engineering manpower pool. A total of fifteen thousand, eight hundred and two (15,802) scholarships worth about N7.5 billion were awarded between 2009 and 2016.

Other notable NCHCDI achievements by Chevron Companies in Nigeria include the training of 230 Nigerians as operators in South Africa for the Escravos Gas-to-Liquids (EGTL) Project; training of 109 Nigerians in operations, maintenance and instrumentation in South Korea for Agbami Deepwater Project; training of more than 400 Nigerians at a Vocational Training Programme (VTP) in Ogere. Ninety-eight per cent of the beneficiaries of the VTP have been employed by CNL while others have been employed by other international oil companies.

CNL also has an ongoing five-year scholarship program worth over N300 Million for Dynamic Positioning training for Nigerian seamen at PEM Offshore Limited, an indigenous company. A total of 172 Nigerian seamen have undergone this training till date

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LOCAL CONTENT

Chevron Nigeria Wins best exhibitor Award 2017 SPE NAICE

By Oge Obi the efficiency and professionalism in the industry and promote an investment friendly climate. Okunbor posited that a consensus has been built around what the issues of the industry are and what next step to take.

Speaking also, the new SPE Council Chair, Engineer Chike Nwosu, appreciated the dignitaries who graced the occasion including the outgoing Chairman, Dr. Saka Matemilola. Nwosu who accepted to serve as the next SPE Chair assured the BoT that he understood the enormity of the task that was before him and promised to take the petroleum association to the next level.

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he 2017 Society of Petroleum Engineers’ (SPE) Nigeria Annual International Conference and Exhibition (NAICE) saw a drift in tide as the oil giant, Chevron Nigeria emerged the conference best exhibitor after a four-year limp to the covetous award.

Rising from the third position in the previous years to the first position was said to be a testament to the oil giant’s assiduous efforts and commitment in the successful implementation of the annual event.

The categories of the award ranged from best technical papers, young professionals category to sub-committee chair persons who worked assiduously for the success of the conference.

The Country Chair of Shell Companies in Nigeria, Osagie Okunbor in his opening remarks applauded the efforts that were put together in the 2017 SPE conference. The Country’s Chair who was represented by the Managing Director of SNEPCo, Bayo Ojulari, commended the cautious decision of the organisers for directing its thought on certainty of the oil industry in Nigeria and how to profitably navigate through the certainty.

Okunbor noted that the conference theme, “Riding the Waves of Boom and Bust, Common Objectives, Diverse Perspective” is most timely given the realities in the industry globally and particularly in Nigeria whose economy is de-

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pended on the revenue from oil. According to him, “despite the diverse perspectives on the issues in the industry, setting and aligning objectives may be a viable option for riding the waves, not just for survival but for sustainability and profitability.”

Speaking further, Okunbor disclosed that part of the International Oil Company’s response to the uncertainties among other actors in the industry is to constantly review and optimise its portfolio with the aim of strengthening its businesses in the area of its services.

And that it is also part of its decision to continue to encourage and release its staff to play active role in professional associations like the SPE so that jointly solutions can be created, open challenges, add value to the industry as well as to the country.

Delighted at the oil giant’s performance at the conference, especially the feat of producing 44 technical papers, representing over 30 per cent of total papers presented at the SPE conference authored by Shell staff, he said that through the high level participation the IOC had in no small measure contributed to the success of the 2017 SPE NAICE. The Country Chair stated that the IOC at industry level would continue to work with other players in the industry and that it would engage its partners, regulators and other stakeholders to improve

The new SPE Chair extolled Matemilola whom he understudied for one year.

Commending the members of the council who he referred to as talented people with whom the SPE will be shaped for another one year. He asserted, “there is no fear in my heart that we will continue to deliver as SPE Nigeria Council has done in years past”. And that SPE under his watch will partner with government particularly the NCDMB, DPR and sister organisations like NAPE, Nigeria Gas Association (NGA) and Manufacturing Association of Nigeria (MAN) so as to diversify the oil sector and explore other energy mix.

“There will be R&D to encourage proper research and development in academia, the ability to transform that initiative to academia to pilot test projects and make them commercially viable. NCDMB will play a greater role to actualise this objective. This structure will deliver innovation for the oil and gas industry, Nwosu said.

Some big wigs who graced the award dinner includes the Executive Secretary of the Nigeria Content Development Monitoring Board (NCDMB), Engineer Simbi Kesiye Wabote, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC) was represented by Group General Manager, R&D, Dr. Bola Afolabi, Managing Director of SNEPCo, Mr. Bayo Ojulari, representative of the Director, Department of Petroleum Resources (DPR) amongst others.

Orient Energy Review Vol 6 No.08 September 2017 19

LOCAL CONTENT

Nigerian Content: Dangote Refinery to pick vendors from NOGIC Qualification System … NCDMB targets opportunities in operations phase …set to launch NCI Fund with $200m

T

he management of Dangote petroleum refinery has agreed to select competent Nigerian vendors that will participate in the construction of the plant from the Nigerian Oil and Gas Industry Joint Qualification System (NOGICJQS), the database of available capacities in the oil and gas industry managed by the Nigerian Content Development and Monitoring Board (NCDMB).

The Chief Operating Officer, Dangote Refinery Project, Mr. Giuseppe Surace committed to this at the technical meeting held between top officials of the company and NCDMB at the refinery project site in Lekki, Lagos State recently.

He affirmed that there were many advantages in patronizing the local market, adding, “Nigerian companies will get the first right of refusal. We will procure anything that is available in Nigeria.”

The COO confirmed there were several Nigerian Content opportunities in the company’s refinery and gas gathering projects but interested companies must submit competitive bids and have technical capabilities. He explained that the project is a private investment, hence the strategy is to get the best quality anywhere in the world at the most competitive price.

He advised local vendors to quote reasonable prices when bidding for industry projects, rather than believe that they would win jobs because of the Nigerian Content Act, irrespective of expensive quotations they submit.

He noted that Dangote Group engaged the services of some Nigerian companies on its fertilizer project which had reached an advanced stage of development and was committed to do the same on the 650,000 barrels

per day refinery project, which will be completed in October 2019.

In his comments, the Executive Secretary NCDMB, Engr. Simbi Wabote promised that the Board will assist the company in the utilization of the NOGICJQS database, to ensure that it maximizes the utilization of local personnel, goods and services in the construction and operations phase of the project. He said, “The Nigerian Content Act applies to every player in the Nigerian oil and gas industry and not just international companies. If Nigerian companies and investors procure everything from abroad then the essence of the Act will be defeated.”

Wabote maintained that slight cost differentials between Nigerian and foreign vendors should not be an excuse to export jobs, stressing that the opportunity cost of creating employment for Nigerians, developing local capacity, retaining spend in the economy and engendering a safe operating environment for companies justifies any marginal cost of execution charged by Nigerian vendors.

He explained that Nigerian companies were affected by high costs of funds and powering their operations with diesel generators, assuring however that investments and initiatives by the Federal Government was already improving the power situation in the

20 Orient Energy Review Vol 6 No.08 September 2017

country.

On funding, the Executive Secretary informed that the Board had obtained all necessary approval to re-launch the Nigerian Content Intervention Fund (NCI Fund). He said the pool available for lending to qualified oil and gas players had been increased from $100m to $200m to ensure that more deserving companies benefit at the same time.

He reiterated that NCI Fund will be disbursed directly by the Bank of Industry (BOI) at eight percent interest rate and repaid within five years.

Speaking further, Wabote sought the collaboration of Dangote Refinery to build infrastructural and human capacity that would support the operations phase of the project, stating that “operations last for many years and there are huge opportunities to tap in from the Local Content perspective.”

He charged the company to develop and submit to it a list of support businesses that will be needed in the operations phase of the refinery so the Board can build the capacity of Nigerian in those areas ahead of the project commencement. He also expressed the Board’s preparedness to partner Dangote Refinery in setting up a world class welding school on the back of the refinery project. www.orientenergyreview.com

INTERVIEW

...........continued from page 9 generator with a variable speed operation to solar power as well as the national grid, (PHCN). It is automated and can select between the available power sources. There’s also an option where you can remotely monitor and control it. We also have a range of wall-mounted and free-standing enclosures in mild steel and stainless steel. Our enclosures are used for power distribution, automation and for instrumentation. We make enclosures for mechanical equipment and skids too. Besides our standard range, we also design and build bespoke solutions using our R&D engineering capability. So, for projects where clients say, “I want something specific”, we sit down with them and our engineers come up with customized solutions.

What are some of the companies you actually deliver your services to?

We have offered services to Total, Chevron, Hydrodive and WAOS in the oil and gas industry. We have a very good relationship with Cummins Power Generation; we supply them with a large quantity of enclosures for their power generator sets.

We also make customized designs for them whenever they have special requirements.

If you see a Cummins generator, there’s a high possibility that it is enclosed in a canopy built by Tranos.

We produce compact substation enclosures for Schneider Electric, and we are working on bringing in new customers like Kohler

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SDMO, who are equally interested in our enclosures.

In what areas are you expecting support from the government?

I always struggle with questions of what government can do for you. I am all for government supporting Nigerian businesses but the truth is that, there are a lot of challenges and not all of them can be solved by the government. If government has to help everybody, then it is no longer business. But there are supply chain challenges that have to do with government agencies like Customs, NAFDAC, SON and others. I think this is an area government can improve and actually do something. It will also help for government to buy our products and use our services.

A lot of people think that development is infrastructure – good roads, good hospitals, good schools, etc. The truth is that,we cannot have good schools without good teachers. So, I think we really, really need to take a step back and pour a lot of money into education.

Are there international companies you admire?

We admire Toyota because of their production system just like a lot of other companies do. We admire Toyota because they have a very advanced production system and they have a continuous drive for improvement. We also admire compa-

nies like GE and Siemens. This is because, have realized that we are not that typical company, where you will say, we produce generators or we produce enclosures; we do much more than that. We have also realized that the knowledge we are building within the organization can do a lot for people.

Where do you see Tranos in 10 years from now?

In ten years, we hope that our production system will be much more advanced than where we are now. We are looking at doing a lot of automation of our processes. On a second thought…, in less than two years, we should have achieved that, which will lead to a drastic reduction of waste.

We are looking at growing our capabilities to build and produce heavier structure in terms tonnages. We presently handle about 20 tons but intend to increase that significantly. We plan moving into a bigger facility with more production lines and we should be routinely exporting our products to other countries.

We shall have a bigger R&D department because we do a lot of research and development; looking for problems we can solve and looking out for solutions we can either improve on or make better.

Finally, we expect that by then, the raw materials and component parts we are struggling to import right now will be sourced locally.

Orient Energy Review Vol 6 No.08 September 2017 21

PHOTO GALLERY

NAICE 2017 IN PICTURES

L

-R: Chike Onyejekwe, Managing Director AITEO; Engr S.D. Thomas, C.E.O. Frontier Oil; Austin Avuru, CEO SEPLAT; Dr. Chioma Nwachuku, GM External Affairs & Communications SEPLAT; Engr. Taofiq Tijani, former Commissioner for Energy & Mineral Resources Lagos State at SEPLAT Stand at the recent Society of Petroleum Engineers (SPE), Nigeria Annual International Conference and Exhibition (NAICE) 2017, in Lagos.

Ibe Kachikwu, Minister for State, DrMinistry of Petroleum Resources

Cross section of participants at the Opening Ceremony at this year’s Society of Petroleum Engineers (SPE) Confab

Team Chevron

Team Seplat 22 Orient Energy Review Vol 6 No.08 September 2017

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PHOTO GALLERY

Faces at the Sustainability in the Extractive Industries (SITEI) Conference 2017 Tagged ‘Building Local Global’, SITEI 2017 focused on strengthening of the local extractive industries for global competition. Bigwigs of the Nigerian Extractive Industries gathered at SITEI 2017 to spur competitive positioning. CSR-in-Action’s SITEI 2017 played host to honourable Ministers Dr Ibe Kachikwu and Dr Kayode Fayemi, the Executive Secretary NCDMB Engr. Simbi Wabote, amongst others.

Dr Ibe Kachikwu, Minister for State Ministry of Petroleum Resources

Dr. Kayode Fayemi, Hon. Minister for Solid Minerals

Engr. Simbi Wabote

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Orient Energy Review Vol 6 No.08 September 2017 23

Offshore Africa: Exploring the Continent’s growing oil Sector in the Wake of Market Rebalancing

By Jerome Onoja Godspower Ike

T

he Organisation of Petroleum Exporting Country (OPEC)-led market rebalancing efforts are gradually beginning to yield positive results globally, and stalled oil and gas projects are currently being revived. In all these, the African oil and gas industry had been described by experts as a major destination for new investments and is expected to attract significant percentage of investible funds in the global oil and gas industry.

This article explores the renewed activities arising from this effort and the attractiveness of Africa to investors.

It also explores the role oil-producing countries in Africa are playing to not only attract, but also retain these investments for a longer period of time.

The African oil and gas industry is

currently on the path of growth and development and is already attracting greater interests from investors across the world.

The rising interests in the African oil and gas industry is coming on the heels of efforts at market rebalancing by stakeholders, championed mainly by the Organisation of the Petroleum Exporting Countries (OPEC).

With the efforts at rebalancing the crude oil market, hope is rising on the return of stability in the market and attractiveness of crude oil and gas.

With this optimism, investors are beginning to strategise; suspended projects are gradually returning, while funds are already flowing into the industry. Africa appears as a lucrative destination in this equation.

Africa has been described as the last true oil and gas frontier with more

24 Orient Energy Review Vol 6 No.08 September 2017

than 4,200 oil and gas blocks identified, while almost half of these blocks are open, subject to force majeure or in the application phase.

Africa, reports said, has proven natural gas reserves of 513 trillion cubic feet (TCF) with 91 per cent of the annual natural gas production of 7.1TCF coming from Nigeria, Libya, Algeria and Egypt.

The continent currently supplies about 15 per cent of the world’s oil and boasts significant untapped reserves estimated at 8% of the world’s proven reserves. These reserves have increased in the last two decades from 5.8% in 1991 and 7.6% in 2001 and this trend is anticipated to continue.

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COVER STORY

“

The regional nature of these challenges and the growing interdependence between net importing and net exporting African countries require a strengthened partnership among all stakeholders to enhance regional energy security,”

According to Abiodun Adesanya, President of the Nigerian Association of Petroleum Explorationists (NAPE), Offshore West Africa sub region is one of the ‘fastest growing and most attractive’ oil and gas provinces in the world today. He said, “Within the last decade, statistics indicate that there had been some recent world-class discoveries in Senegal, Ghana, Nigeria, Sierra Leone, Liberia, all the way to Angola. Also, there are some similar finds in East Africa offshore from Mozambique to Kenya”.

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He added, “It is not surprising at all that the attention of some of the IOCs is being drawn to the region, therefore making it a preferred destination for investment in comparison to Europe and America where exploration works have long attained maturity.

PriceWaterHouse Coopers, PwC, in one of its report identified the crown jewels, who are the new players on the east coast, particularly Mozambique and Tanzania. With this, it said East Africa is merging as a new source of gas and oil.

Particularly, the report disclosed that significant gas finds in excess of 127 TCF in Mozambique had created the potential for another African super player, adding that with further exploration and development it is expected that Mozambique could overtake Nigeria and Algeria as the African country with the largest gas reserves.

It noted that Mozambique is expected to become the second-largest exporter of Liquefied Natural Gas (LNG) by 2025, as the country steps up production from 10 million tonnes per annum (Mtpa) in 2017 to an envisaged 50Mtpa.

“Access to the lucrative Asian LNG market has significant economic benefits for the East African region and could act as a catalyst for meaningful economic development. Developments in Ghana have demonstrated the possibilities within Africa to the world,” the report explained.

The report added that more than 80 per cent of the 1,300 blocks in North Africa are licensed, while in sub-Saharan Africa it is estimated that only about 30 per cent of 2,900 blocks are licensed.

“In the sub-Saharan regions it is evident that many new opportunities still exist, especially for exploration and production (E&P) companies that are willing to take risks,” the report pointed out.

Furthermore, in its analysis of the West African oil and gas industry, Infield Systems Limited, in a report presented by its analyst, Catarina Podevyn, said the previous year has been a challenging period for the global oil and gas industry, adding that West Africa certainly has not been immune to the repercussions of oil price decline.

The report noted that delayed projects include Shell’s Bonga South West, where Final Investment Decision (FID) had been postponed, while Maersk’s Chissonga had gone back to the drawing board.

It however, stated that going forward, West African development is expected to remain strong, buoyed by a handful of giant projects sanctioned prior to the oil price collapse, and supported by increasing investment in new areas of production.

It added that with several capital intensive field developments sanctioned prior to the oil price decline, West Africa is anticipated to see robust demand growth through to 2018, noting that over the 2016-2020 timeframe, a capital expenditure (CAPEX) demand compound annual growth rate (CAGR) of 4% is forecast.

On a country-by-country basis, Infield explained that Angola is expected to dominate demand in West Africa, driven by Total’s activities; while the highest growth rates are anticipated for emerging countries of hydrocarbon production, in particular Côte d’Ivoire and the more established Equatorial Guinea.

Specifically, it said Angola is expected to continue to drive capex demand within the West African region, with a 47% market share of demand between 2016 and 2020.

It said after a decline in capex investment between 2014 and 2015, predominately as a result of giant projects such as N’Goma and CLOV seeing the majority of its development spend during the previous period, it expects Angola’s demand to increase year-onyear through to a peak spend in 2018.

According to the report, projects expected to drive this peak include Kaombo 2 and the presaltCameia Mound, with the majority of installation capex forecast to take place in 2018.

Orient Energy Review Vol 6 No.08 September 2017 25

COVER STORY

“

Access to the lucrative Asian LNG market has significant economic benefits for the East African region and could act as a catalyst for meaningful economic development.

Developments in Ghana have demonstrated the possibilities within Africa to the world,” Again, the report said Nigeria is expected to hold a 22% share of offshore expenditure demand over the 2016-2020 timeframe, a slight increase from the 18% market share seen over the previous five years.

Altogether, Infield Systems projected that 54 potential fields offshore Nigeria would require capex spend over the forecast timeframe, with Total-led developments anticipated to form 38% of demand during the period.

The report said the giant Egina project is expected to remain key to Total’s investment, with 60% of the French international oil company’s forecast demand offshore Nigeria expected to be attributable to the development.

In the case of Ghana, the report projected that the country would remain the third-largest destination for operator capex offshore West Africa going toward 2020, driven by the TEN (DeepwaterTano) developments.

It noted that Tullow’s Mahogany East and the Eni-operated Sankofa OTCP are also anticipated to require substantial investment during the next five years.

Equatorial Guinea, the report said, is expected to undergo a capex demand Compound Average Growth Rate (CAGR) of 13% over the next five years to 202, adding that a total of 28 fields may require capex during the period; an increase from the 15 fields invested in over the previous five years.

26 Orient Energy Review Vol 6 No.08 September 2017

Key to Equatorial Guinea’s demand growth, it said, is expected to be Ophir’s Fortuna FLNG project, which is forecast to comprise 28% of the country’s offshore capex demand during the 2016-2020 period.

Furthermore, the report said the previous five years has witnessed significant capex growth offshore Congo (Brazzaville) noting that a CAGR of some 154% from 2011 to 2015.

This, Infield Systems said, had been predominately driven by investment on the Moho Nord Marine project, which has comprised 52% of the country’s offshore expenditure.

For Côte d’Ivoire, Infield said Total’s Saphir discovery in April 2014 highlighted the potential of the ultra-deepwater blocks to the west of the country’s offshore zone and the under-explored San Pedro basin.

The country projected that up to 11 potential fields offshore Côte d’Ivoire would require capex during the next five years to 2020, while the highest demand is expected on Saphir.

It also stated that the country’s eastern offshore zone, where prospects such as Eland and Kudu neighbor Ghana’s TEN fields, would also see investment during the period, while over the upcoming five years the country is likely to see increasing exploration, as a number of new operators have entered the country’s market over recent

In addition, Infield Systems forecast a number of possible developments offshore Cameroon to require expenditure over the 2016-2020 timeframe.

It said while the majority of these are in the very early stages of planning, the Golar Cameroon FLNG is expected to see completion in 2017, with the FID reached by Golar and its partners in September 2015.

It added that prospects offshore Senegal may also see capex begin before the end of the decade, noting that it exects for operator Cairn Energy to lead development on the FAN-1 and SNE-1 Sangomar Deep discoveries, which were amongst the largest global discoveries of 2014.

It also projected that the two prospects to be developed via an FPSO, which would have the capacity for future tie-ins of neighboring prospects, although the operator and its partners have yet to announce when a FID will be due on the development.

PwC declared that there are many key opportunities within Africa due to new exploration blocks being opened for competitive bidding; port development and management; pipeline engineering and construction (both subsea and onshore); onshore and offshore maintenance.

It also identified some more factors that would open the opportunities to include LNG plant engineering and construction; CO2 reduction and gas-powered electricity generation; other gas monetisation projects for local use, such as methanol, fertilisers, urea; stability of supply and security of supply with a reduction in exports; Others are foreign exchange inflows; distribution of wealth – for the benefit for all citizens; infrastructure development mega projects; and new refinery development or upgrades.

Also, in its own report, Ernst and Young (EY) stated that African countries are increasing their production of oil and gas, addi ng that revenues from higher prices and the investment that new discoveries are attracting, have made a key contribution to growth and developmental initiatives.

It noted that while the majority of reserves and production remain concentrated in six countries — Nigeria, Libya, Algeria, Angola (oil), Sudan (oil) and Egypt (gas) — there have been ever-increasing discoveries of new oil and gas, for example, in Ghana, Tanzania, Mozambique and Uganda, and prospected fields in many countries, including Sierra Leone, Mali and Kenya.

EY added that despite current levels of concentration, 23 African countries were producers of oil and gas in 2012 and still rising, noting that oil and gas would be a key driver of growth across much of Africa going forward.

The report noted that there are ever-increasing discoveries of new oil and gas, for example, in Ghana, Tanzania, Mozambique, Kenya and Uganda, while bright prospects are seen for many other countries, including Sierra Leone, Morocco, Gabon, Côte d’Ivoire, Liberia, Mali and Kenya.

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COVER STORY It said, “Before the Libyan production curtailments, African oil production had been growing steadily over the past decade. Conventional forecasts see African oil supply growth continuing over the next 25 years, albeit more slowly than it had recently — with forecast ranges of growth over the period of between 0.5 and 2.0 million barrels per day.

“African natural gas supply has similarly grown strongly in the recent decade, and forecasts of supply growth are dramatically stronger than for oil, with supply expected to double by 2035.”

Furthermore, it is also argued that with growing interest and investment from India, China and international oil companies operating in Africa, there had been increased competition for exploration acreage in recent years.

Reports are rife that as some of the traditional multinationals divest from areas in Africa, opportunities for new independents will emerge, causing the trading mix and diversity of the companies trading in Africa to change.

This, experts said, would cause established energy companies to become more agile in order to respond to greater competition and emerging trends.

They said that apart from Mozambique joining Egypt, Nigeria Libya, Algeria and Angola as major upstream power houses in Africa, it unlikely that Ghana or the other East African countries would disturb the equilibrium that had existed in Africa for the last two decades.

Analysts at Ernst and Young also argued that refining capacity in Africa would continue to increase, in contrast to what is happening in the developing world, as countries strive to have a greater security of supply and increase export earnings from the sale of refined products.

Already, African countries have started to witness large inflow of foreign investment, with Nigeria, a major oil producing country in Africa, signing agreements with multinational oil companies valued at over $4 billion over a period of 18 months.

Similar scenarios are recorded in Libya, Algeria, Morocco, Ghana, Sudan, and Egypt, as well as in almost all the oil-producing countries in the continent.

Highlighting investment opportunities in Africa, Olivier Mussat, Chief Investment Officer, International Finance Corporation, IFC, said half of the estimated financing needs for

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infrastructure in Africa is unmet.

He argued that currently, developing countries spend $1 trillion annually on infrastructure, noting, however, that the need for investment was estimated to double annually over the next decade.

According to him, East Asia including China would require the majority of investment, sub-Saharan Africa’s needs seem smaller at about $50 billion to $150 billion compared to other regions, but they are substantial relative to the region’s GDP. Mussat stated that more than half of the investment requirement would be in the energy sector, especially in the electricity sector, including generation, capacity, transmission and distribution networks, adding that preparation costs, including costs of design and arranging financial support, can constitute up to 10% of overall costs.

Also speaking on the opportunities in Africa, Partner in charge of Energy & Project Finance Group at ACAS-Law (Adepetun, Caxton-Martins, Agbor and Segun), Donna Obaseki-Ogunnaike identified opportunities both in the Nigerian and African oil and gas sector to include investment in LNG, independent power plants, gas to liquid conversion, natural gas liquids (NGL) and methanol.

Adding her voice to the preparedness of the African countries, MsDamilolaOwolabi, Managing Director of Dreg Waters Petroleum & Logistics Ltd believes the Nigerian government is ready to receive potential Oil and Gas investors and have put the necessary infrastructure in place.

She explains, “There are currently no challenges encountered in processing automated permits at the Department of Petroleum Resources as a high-speed processing measure has been put in place by the agency.

This ensures a 48-hour turn-around time for issuance of licenses.

Speaking as an Oil and Gas consultant on logistics, also to new firms; she emphasizes the easy access to statutory registrations, viz: Corporate Affairs Commission; Federal Inland Revenue Service; and License for Operators or Permit for Contractors. “Most of these processes have been automated and made accessible to remove unnecessary bottleneck and improve the ease of doing business index in Nigeria” However, as Africa awaits a further rush in investment, even with the current efforts at market rebalancing, the African Development Bank and the African Union in a report titled, ‘Oil and Gas in Africa,’ averred that a key concern regarding the governance of oil and gas resources is that the governments of African oil and gas-producing countries receive an inadequate share of the large rents from production.

The report, which is a supplement to the African Development Report, said this might stem from a number of reasons, including contracts and regimes that are not designed to extract maximum rents; and oil and gas policies that are designed primarily to promote and attract investments and have not evolved with changing global dynamics and national interests.

The report noted that the sustainable development of oil and gas resources requires policies, principles, and practices that support the utilization of resources in a manner that does not prevent future generations from benefiting from the resources.

It also added that a great challenge, particularly for oil-producing African countries, is to ensure sufficient, reliable, and environmentally responsible supplies of oil, at prices that reflect market fundamentals.

“

“Most of these processes have been automated and made accessible to remove unnecessary bottleneck and improve the ease of doing business index in Nigeria”

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COVER STORY To achieve this important goal, the report noted that several challenges had to be addressed, including high and volatile oil prices; growing external and internal demand for oil; increasing import dependence of many African countries; and, most importantly, sustainable management of the continent’s oil and gas resources for the benefit of all.

“The regional nature of these challenges and the growing interdependence between net importing and net exporting African countries require a strengthened partnership among all stakeholders to enhance regional energy security,” it added.

Despite the challenges and issues involved, the report however, agreed that an oil and gas resource boom can, under the right circumstances, be an important catalyst for growth and development, adding that the often-referred-to ‘natural resource curse’ can be avoided with the right institutions and policies.

It said, “Several countries in Africa have demonstrated this and there is some reason for cautious optimism that more countries have learned hard lessons from past resource booms, and, in future, will pursue strategies and policies that would allow them to fully reap the benefits of their natural resource wealth.”

To this end, to forestall a negative side to the attractiveness of Africa oil and gas industry, the AfDB and the AU said it is important for continental bodies, to become more engaged in helping African countries manage their oil and gas resources.

The report also argued that it is likewise very important that these continental bodies, together with other international donors and stakeholders, provide technical and financial assistance to help new oil and gas producers negotiate fair and pro-development contracts where environmental, social, and revenue distribution are an integral part of the management of oil and gas.

At the regional level, the report stated that regional economic blocs in Africa can play a key supporting and coordinating role and can be instrumental in advancing a number of initiatives.

According to the report, these initiatives can be in the area of promoting regional integration in oil and gas exploitation; building regional infrastructure, such as oil and gas pipelines, for sustainable exploitation of oil and gas; and promoting regional economies of scale in the sector, focusing especially on downstream industries, such as refineries.

Others, the report said, are encouraging countries to adhere to principles of good governance and transparency initiatives for revenue management; promoting regional sharing of experiences; promote intra-regional trade in the oil and gas sector and support and promote the African Petroleum Fund.

The rest are:“establish regional mechanisms for sharing experiences on oil and gas issues, especially those related to contract negotiations and technology transfer; and encourage the sharing of regional expertise in the sector.

In the same vein, African Petroleum Producers Organisation, APPO, the umbrella body for oil–producing countries in Africa, in one of their reports, stated that for member countries to position themselves for the expected investments, they should focus on value addition rather than volume of production.

The group added that governments of these countries needed to work harder for investments under the current economic circumstance, while ensuring that partnerships focus on flexibility rather than contractual commitments.

The group said regulatory frameworks should be fit for purpose, while efforts should be made to control and limit ineffective bureaucratic procedures including permits and consents.

It also said oil-producing countries in the continent should implement anti-corruption initiatives and ensure transparency; implement better management of production cost elements; co- integrate upstream and downstream activities; embed and establish linkages and the rest of economy to make it more resilient to shocks such as the current one.

Others, it said, are, “Strive towards joint collaboration between infrastructure developers; Promote private sector investment incentives; work towards a more balance economy rather than current emphasis on export of crude oil; entrench sincerity of purpose and remain consistent with project development programmes so as to attract and retain participation of partners.

“Repeal and/or discard arrogant and dissenting laws; invest in human capital development to foster security with APPO member counties; promote local content management and pursue community development as a shared responsibility between stakeholders; implement continuous learning and knowledge sharing; safeguard the safety, environment and social development in producing communities.

“Implement gas monetisation and flare out programmes to protect the environment and mitigate climate change; see petroleum as source of energy and growth enabler instead of emphasis on crude export; develop medium-long term strategies to anticipate developments in the oil market.

“There should be clarity on role/powers of ministers and regulatory agencies to reduce approval cycle time and operational bottlenecks; regulatory certainty, clarity and flexibility for changes overtime to reflect circumstances; promotion of regional synergy and cross border investment in infrastructure; establish-

28 Orient Energy Review Vol 6 No.08 September 2017

ment of a robust information databank on challenges and opportunities for existing and potential investors in the sector.”

Considering the capacity of indigenous companies to take advantage of the new finds, MrAbiodunAdesanya said, “Collaboration is the name of the game for operating companies wanting to work in the deep offshore as the cost is very high and prohibitive. This is evident in medium-sized international companies who are seen collaborating to get the best from the industry. Indigenous companies simply do not have the required funding except through collaboration with IOCs to operate in the deep offshore else they run the risk of over-exposure”.

Speaking on ways to attract and sustain investments in the African oil and gas industry, Donna Obaseki-Ogunnaike of ACAS-Law said efforts should be geared towards harmonising laws, regulations and policies on gas into a single piece of legislation in order to achieve clarity in the legal/regulatory regime for gas.

She also noted that the continent should encourage the increase of gas reserves and extraction of available reserves through the grant of licences/permits for gas exploration and extraction, distinct from the approvals for crude oil.

She said tax holidays should be granted to investors engaging in gas activities as gas projects, adding that pioneer industries status should also be extended to include activities for gas exploration, extraction and processing.

In conclusion, as Africa awaits the rush of investments into the oil and gas sector, it is important that oil-producing countries take steps to forestall the ‘resource-curse syndrome’ and make sure that efforts are geared towards ensuring that the investments are sustained and used for the growth and development of the countries and the continent in general.

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Orient Energy Review Vol 6 No.08 September 2017 29

GHANA REPORTS

Bui Power Authority Compensates Farmers Affected By Solar Project

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he Bui Power Authority (BPA) last Tuesday, August 29, 2017, paid GH¢42, 277 as compensation to the five farmers whose farms will be affected by the 50-megawatt solar plant to be established at Carpenter in the Bole Bamboi District in the Northern Region.

The farmers are Baba Tuoro Nimber, Kwasi Bandong, Papa Tailor, Kanyokanyuriyi and Jonas Nwinsumba.

Presenting the compensation package to the farmers at a mini durbar at Carpenter, the Chief Executive Officer (CEO) of the BPA, Mr Fred Oware, explained that the money was the compensation meant for the destruction of their farm produce but not the purchase of their lands.

He gave an assurance that communities affected by the construction of the Bui Dam, whose compensation had not been paid yet would certainly be settled. He also said the authority was establishing a solar project estimated to cost $56million

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to support the Bui Dam to help generate more power during the dry season.

According to him, the authority had secured all the necessary machines and equipment for the commencement of the project.

He said the BPA collaborated with the Land Valuation Division (LVD) for the valuation of the 1,000acre land and the payment of the compensation package to the five affected farmers.

He assured the chiefs and residents of Carpenter that the BPA’s vision to establish Bui City was still in the plans of the authority.

Contractor The CEO of Strategic Security Systems International, a Ghanaian company, and contractors of the project, Oheneba Ofori Boateng told the Daily Graphic that work was expected to start within two months and completed within 12 months.

“The duration of the project should not take more than 18 months, we are to do it under 12 months, so

come August next year we will be here with other dignitaries to cut the sod for the inauguration of the project.” he stated.

According to him, the company was now waiting for the chiefs and people of the area to officially hand the land over to the company for it to begin the project.

The Omanhene of Carpenter, Nana Solomon Dompeeh Antwi II, appealed to the contractor to engage the youth in the area in the execution of the project.

He was optimistic that the project when completed would help create jobs and bring development to the town and its environs.

Nana Antwi II thanked the government and the BPA for selecting the Carpenter community to host the solar project and assured them of the Mo Traditional Council’s support to the BPA . He advised the five beneficiaries to make judicious use of the compensation package.

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GHANA REPORTS

Ghana Launches World Energy Council’s Future Energy Leaders’ Program

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hana officially launched its national chapter of the World Energy Council’s Future Energy Leaders’ program. The chapter welcomed ambitious young professional interested in energy from corporate institutions, government and universities in an effort to join the scheme.

The launch of the program under the theme, ‘Building the capacity of young energy experts to think out of the box for a sustainable energy future’, held at Ghana’s Energy Commission on August 30, is the first of its kind within Africa.

The future Energy Leaders’ program is a platform designed to shape and grow young professionals to become the energy leaders of tomorrow by engaging them in national, regional activities and events. Its objectives are to inspire participants to become the next generation of energy leaders capable of solving the world’s most pressing and rapidly changing sustainability challenges.

William Horsu, Secretary, Ghana member committee, said: “The aim of the program is to enable the

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Ghana to become a more active member committee through its young energy leaders of tomorrow.

Currently, our existing leaders do not have any plans for nurturing future talent for our youth within the energy sector. The opposite is true in countries such as Germany. The future of our country will be in the hands of our youth. The FEL national program will act as a springboard to enable this to happen.”

Rosa Djangba, member of the Council’s global Future Energy Leaders’ program, commented: “Young energy professionals are not really currently involved in the energy sector in Ghana. Their voices and opinions are not heard or considered when decisions are being made. The leading actors in the Ghana’s energy sector are the much older professionals who will soon be retiring out of their jobs. There is therefore the need to bring up a generation of energy professionals who will take over the energy sector and make decisions that will help improve access to reliable sources of energy among others.

“There is also a generation of young

people who want to pursue careers in the energy sector. There is a need for an organization that will be able to provide advisory services for such individuals. FEL Ghana will go a long way to solve some of these issues. I am very excited about this launch, and the future is bright for Ghana. FEL Ghana will seek to have partnerships with other FELs in member countries to embark on projects that will be mutually beneficial for the Council’s partnering countries.”

Earlier this year, Sheila Elizabeth Bortey-Kharis, an electrical engineer with the Ghana Grid Company Ltd. working as an operations planning engineer at the nation’s system control center, was selected as part of the Council’s FEL-100 program.

Her role is to draw day ahead plans for the operation and control of the National Interconnected Transmission System in Ghana. She looks forward to working with the many young experts across the globe and sharing her experiences and knowledge as result, with her Ghanaian counterparts.

Orient Energy Review Vol 6 No.08 September 2017 31

COMMUNITY REPORTS

Amnesty Programme Trains 14,366 Ex-Agitators – Boroh Ijaw Youths Shut Content Board For Not Relocating IOCs Offices • Bayelsa govt, IYC condemn killing of soldiers

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he Coordinator, Presidential Amnesty Programme (PAP) Brig. Gen. Paul Boroh (rtd.), has said that about 14,366 ex-agitators had been trained in the programme.

Boroh, who made this disclosure when he featured at the News Agency of Nigeria, NAN, Forum in Abuja on Sunday, explained that their capacities had also been developed in the areas of agriculture, automobile engineering, aviation sector and then we are also looking at the sports sector.

“As we speak, we have trained well over 5,000 persons in the area of education capacity development and we have trained well over 22,000 others in the area of skills acquisitions and entrepreneurship development,” he said.

He added that since the inception of the programme, it had granted amnesty to 30,000 ex-agitators of the Niger Delta region as well as pronouncement of their engagement to capacity development.

Mr. Boroh said that between now and December 17, its organisation would continue to graduate more ex-agitators, who have benefited from the scheme.

According to the Coordinator, the Amnesty education programme is winding down and there is need to graduate more of the beneficiaries. He said the role of education in a national development cannot be over emphasised.

He added that education was a pivotal investment for human and economic development and also influenced by the

environment within which it exists.

Mr. Boroh said that the President Muhammadu Buhari administration is aware of the needs of today’s youth to have a specific set of skills to survive in this competitive world to progress.

The presidential aide said that the beneficiaries who are now graduates were aware of the socio-economic scenario of the nation and can help in moving the region and the nation forward.

According to him, the beneficiaries can now contribute towards nation-building which requires a democratic society that allows the contribution of all, rich or poor.

“From now till December 17 you will be hearing of graduations because we are winding down and positively for that matter as well as empowerment.

“We are using government institutions, we think the resources we spent in this programme will be better utilised within the country. That is why we are using government owned institutions instead of institutions abroad, this is our focus.

“Right now, we have trained about 14,366 ex-agitators in the programme and their capacities have also been developed in the areas of agriculture, automobile engineering, aviation sector and then we are also looking at the sports sector,” he said.

He said other areas included skill acquisitions, entrepreneurship and educational development.

32 Orient Energy Review Vol 6 No.08 September 2017

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jaw youths have shut down business activities at the operational headquarters of the Nigerian Content Development and Monitoring Board (NCDMB) in Yenagoa, the Bayelsa State capital.

The youths, under the aegis of the Ijaw Youth Congress (IYC) worldwide led by the Chairman of the Central Zone, Comrade Tari Tori, said the action was, among others, a result of alleged refusal by the board to compel the international oil companies (IOCs) to relocate to the Niger Delta.

They accused the NCDMB of operating an empty office in Bayelsa without notable directors and top management staff while opening operating branch offices in Abuja and Lagos.

The youths demanded that the Federal Government should immediately mandate all IOCs to relocate to the region, and that the executive secretary of the board must operate from the office in Bayelsa, instead of Abuja as, according to them, the law of the board demands.

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COMMUNITY REPORTS The IYC also wants the board to immediately cancel the two offices created in Abuja and Lagos and relocate all NCDMB offices to the Niger Delta.While addressing the angry youths, Tori alleged that the NCDMB contravened the Nigerian Content Act, section 71, sub-paragraph 3, which they claimed stipulates that the local content board has the powers to establish branch offices within oil and gas producing states.

Lamenting that the board opened offices in Abuja and Lagos but has failed to open branches in the oil producing states, the IYC said it would not allow the NCDMB to divide the people and their common interest. According to him, all directors and the executive secretary spend time everyday in other offices in Lagos and Abuja but come once in three months to the headquarters.

A member of the board who pleaded anonymity told The Guardian that it was surprising that while the youths were pleading for the relocation of multinational oil companies, they were harassing the few that were in the region.

The source said that indeed the NCDMB maintained a liaison office in Abuja that has only five members of staff, adding that the office was hired because of the relationship between the company, the petroleum ministry and other such agencies. He condemned the turn of events during the protest, noting that what the youths were doing was capable of scaring away would-be investors from the region.

“We are not even thinking of relocating. Where are we going to move our 17-storey headquarters which is already in the 12th floor? The ED already explained everything to the IYC worldwide leadership that visited him, why is the zonal body now overriding the national? “ he queried.

In another development, the IYC condemned the killing of four soldiers and a civilian by unknown www.orientenergyreview.com

gunmen at Ekeremor Local Government of Bayelsa on Monday.

The gunmen suspected to be militants had recently ambushed and killed four soldiers and a civilian along the waterways of Letugbene. A statement by its spokesman, Henry Iyallah, described the killing as sad, unfortunate and barbaric considering the fact that not too long ago, soldiers were murdered at Ogbugbagbene community in Burutu Local Government Area of Delta State.

“We call on the security apparatus to investigate and unravel those behind these dastardly acts. These unfortunate killings do not reflect the position of the Ijaw people.

The IYC extends its sympathy to the military authorities and the families of the soldiers and civilian who lost their lives in this unfortunate incident while also expressing their cooperation to wipe out criminal elements from Ijaw communities.”

According to the group, it is not part of the culture of Ijaw people to take the lives of human beings for no just case. “These actions are anti-Ijaw interest and against the interest of the communities close to where the killings took place in Bayelsa State.”

The state government has also condemned the killing of the soldiers.

In a statement, the Commissioner for Information and Orientation, Hon. Jonathan Obuebite expressed serious regret over the unfortunate incident, describing it as unwarranted, barbaric and totally unacceptable.

It was learnt that the militants overpowered the soldiers, seized their arms, moved them to a location in the creeks and shot them dead. While one of the civilians, a boat driver was said to have escaped, the only survivor of the attack reportedly jumped into the water before he was shot by the hoodlums.

Delay in Ogoni clean-up worries Rivers Students

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he delay by the Nigerian Government to begin the actual clean-up of oil impacted sites in Ogoniland as recommended by United Nations Environment Programme, UNEP, is now a source of serious concern for students in Rivers State.

A group known as Rivers South-East Students Assembly, RSESA, says it is sad that the government was yet to begin work in the area more than a year after Vice President Yemi Osinbajo flagged off the clean-up in Bodo.

National Coordinator of RSESA, Mr. Enoch Fubara, appealed to President Muhammadu Buhari to clean up Ogoniland so as to improve the health and economic life of people of the area.

Fubara also called on every authority concerned with the clean-up to hasten it up, saying pollution in the area was posing a serious health challenge to the people.

“Basically, we want to lend our voice and call on the Federal Government and other relevant authorities to hasten up with the implementation of UNEP clean-up report in Ogoniland.

“The health condition of the people of this senatorial district is worrisome.“There is no potable drinking water in the area, therefore there is need for the implementation of the clean up to be quick, because it will help people from this area and even students to live a healthy life,” he said.

Orient Energy Review Vol 6 No.08 September 2017 33

COMMUNITY REPORTS

Hurricane Harvey: Shell to donate $1m to American Red Cross

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nternational oil company, Shell, has said it will make an initial contribution of $1 million to the Hurricane Harvey disaster relief fund.

According to a statement by Bruce Culpepper, Shell U.S. President on Wednesday, Shell said it had informed the American Red Cross about the donation.

The company said as recovery and relief efforts evolve, it will consider where else to offer assistance that can have the most immediate impact.

“Our roots run extremely deep in Houston and we are committed to doing our part to help the city move on in the aftermath of Harvey,” he said.

“Shell employs nearly 20,000 people in the U.S. and nearly half of them are being directly impacted by Harvey,” said Culpepper. “Despite the hardships associated with this event, countless employees have reached out to understand how they can contribute to the relief effort. Ours is a resilient family and I’m proud of the effort employees are making to look after their neighbours and fellow citizens,” the statement read.

Chevron contributes $1m to Texas Hurricane Harvey relief efforts

34 Orient Energy Review Vol 6 No.08 September 2017

Chevron Corporation has announced that it is making a $1 million contribution to the American Red Cross for the immediate relief efforts under way to assist victims of Hurricane Harvey that struck Texas over the weekend.

“Our thoughts are with all the people who have suffered tremendous losses and disruption from this catastrophic hurricane and related flooding,” said Jeff Shellebarger, president, Chevron North America Exploration and Production Company.

“As a business with deep ties to Texas and Houston , this donation will assist with the initial critical relief process.

We will continue to work with responding organisations to support ongoing recovery efforts, which we hope can begin soon.”

The donation will support relief efforts throughout the affected regions, including both Corpus Christi and the greater Houston metropolitan area. In addition, the company will match donations made to the relief efforts by its employees and retirees, many of whom have seen the tragedy unfold firsthand.

One of Chevron’s top priorities is protecting its employees, families and communities when they may need assistance in times of emergency.

The American Red Cross is a key partner in delivering that assistance. “The Red Cross is working around the clock in extremely challenging conditions in Texas to help people impacted by Hurricane Harvey,” said Gail McGovern , president and CEO of the American Red Cross.

“We couldn’t do it without the generosity of our donors – like Chevron. With their support, the Red Cross can be there when disaster strikes to respond with shelter, food and the necessary supplies to ensure people are cared for, and to help during the recovery process. We’re extremely grateful for their support.”

Houston represents the

single-largest concentration of Chevron employees globally, and the company has important business interests throughout Texas, including the Permian Basin and Corpus Christi.

A number of Chevron’s businesses are headquartered in Houston, including our exploration and production companies for North America, Africa and Latin America; our technology companies; pipeline, power and global procurement businesses; and the supply and trading function.

In addition, many of Chevron’s major capital projects are planned and developed from Houston.

Collapsed Bridge Cuts Off Bayelsa Oil, Gas Community

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esidents of Imiringi, oil and gas-rich community in Ogbia Local Government Area, Bayelsa State, have been separated from Yenagoa, the capital city and other sections of the state, following the inability of the state government to repair the bridge since it buckled during the 2012 flood disaster.

The predominantly agrarian community, host to the Anglo-Dutch oil giant, Shell Petroleum Development Company, SPDC, has over 15 functional oil wells and 10 gas wells

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EXPLORATION & PRODUCTION

It also hosts Federal Government Girls College, Imiringi, and the ailing Bayelsa-owned gas turbine plant, otherwise known as the Imiringi Gas Turbine, built by the administration of late Chief Melford Okilo during the Second Republic when Bayelsa was part of the old Rivers State.

Sadly, residents of the serene but fast-growing settlement are not happy with what they described as the continued desertion of work on the collapsed bridge linking the community to the rest of the state. The locals built a makeshift wooden channel, popularly known as Monkey Bridge, across the creek to link the community, when the bridge built over four decades ago went bad and the long distance of the narrow SPDC iron bridge from the heart of the community.

The SPDC steel structure, community sources told a local newspapper, was built by the company to enable personnel access its many locations in the community.

Dashed expectation The hope of the natives was, however, rekindled, when the state government intervened after the devastating flood and awarded contract for the construction of a new bridge across the creek.

But work on the project had since stopped with the contractor pulling out of site, following the drop in the state’s allocation from the Federation Account. Also, the temporary wooden structure is gradually decaying, threatened by the rising water level. Disturbed by the development, indigenes of the community have called on the state government to resume work.

Shell Bridge serves limited purpose A resident of the area, who simply identified himself as Gift, said: “We had thought that the second coming of the contractor to site sometime in 2015 would see to the completion of the project. But the

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unexpected recession came and the project was abandoned over alleged inability of the government to meet up its financial obligation.

The only link to the community presently is through a narrow steel bridge built several years ago

by SPDC to enable its personnel access its numerous facilities in the area.” Another indigene, Grace, said: “Our people are mainly farmers and you do not expect us carry our farm produce and start going through the rigours of passing through the Shell bridge, which is far away from community, to access our homes.

Nigeria: Eland Oil & Gas Mobilises Rig For Opuama-7 Sidetrack

Appeal to govt “We have no choice than to construct this makeshift wooden bridge across the creek. We are not happy, as you can see the new bridge project awarded by the state government has been abandoned in spite of the contribution our community makes to the national and state coffers.” Also heartbroken by the plight of the community, a youth leader, Collins Enato, who recalled that one Pastor Ranami Afagha mobilised community folks, last year, to rehabilitate the temporary makeshift wooden structure pending when work resumes on the abandoned bridge project, said: ”We are appealing to the state government to hear the cry of our people and mobilise the contractor back to site.”

Renowned environmentalist, Alagoa Morris, also pleaded with the government to revisit the abandoned bridge project, saying, “the Imiringi Unity Bridge is one major project the whole community is looking up to the state government to do for them. “Even though the state government made some attempts at reconstructing this bridge that was destroyed by the great flood of 2012, the project site seemed abandoned for two years now.”

Following mobilisation of the rig, drilling at Opuama-7 is expected to commence by around mid-September and is forecast to begin production in October. Upon completion of drilling, initial production from Opuama-7 is expected to be 5,900 bopd (2,655 bopd net*) taking total production at OML 40 to over 18,000bopd (8,100bopd net*).

AIM-listed Eland Oil & Gas has confirmed that the OES Teamwork Righas been mobilised to the Opuama Field, OML 40, in preparation to perform the sidetrack of the Opuama-7 well.

Since 1 June 2017, there have been 3 months of production from OML 40, at an average rate for producing days of over 11,750bopd (5,287bopd net*). More than 1,080,000 barrels of oil (486,000 net*) have been produced into the Forcados terminal in this 3-month period, with only 0.95% downtime for maintenance during this time. Current gross production from Opuama is around 12,500bopd.

Further revenue receipts from export through shipping of $3.5million have been received and settlement of $3.8million to a shipping contractor has also been completed by Elcrest. Final amounts due to Elcrest and to shipping related contractors are expected to be concluded within the next month.

George Maxwell, CEO of Eland commented saying ‘We are delighted to have mobilised the OES Teamwork Rig to Opuama-7 and following our successful placing we are fully funded for the drilling of the well. Opuama-7 alone is expected to increase current average production by nearly 50% taking total production to around 18,000bopd. Elcrest’s maiden use of a swamp drilling rig shows how far the Company has come since inception and is a significant advancement and achievement for all involved in the Company.

‘The consistent and significant levels of uptime and production seen from Opuama field will continue to improve cashflows and allow us to further add value for all stakeholders and fund the development of our world class asset base in the Niger Delta.’ * Net production figures relate to Elcrest Exploration and Production Nigeria, Eland’s joint venture company. Production rates, when oil is exported via Forcados, are as measured at the Opuama PD meter, are subject to reconciliation and will differ from sales volumes.

Orient Energy Review Vol 6 No.08 September 2017 35

EXPLORATION & PRODUCTION

Namibia: Chariot Oil and Egypt Signs Three Hydrocarbon Exploration Gas renounces offshore blocks 2714A and 2714B Agreements With Shell And Apex International Energy

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he Egyptian government awarded an oil and gas exploration project to the Anglo-Dutch Shell group and two exploration projects to the American company Apex International Energy.

These three projects located in the western Egyptian desert should lead to the excavation of 16 new fields over an undisclosed area.

The oil ministry said in a statement that the first transaction would allow Shell to invest $ 35.5 million, and the second would see Apex, which is operating for the first time in Egypt, investing $ 45.9 million On the two projects, Reuters said .

The awarding of these projects comes just after the signing of three new exploration agreements in the Western Desert with Egyptian Petroleum Corporation (EGPC), Apache Corporation and Merlon Petroleum Company. An acceleration of the agreements, which is part of the Cairo strategy of attracting heavy investments in the under-exploited areas of the country.

Between June 2016 and July 2017 (previous fiscal year), international companies invested $ 8.1 billion in Egypt. *Reuters

Saipem Awarded New Work Worth $370 Million

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hariot Oil and Gas in Namibia chose not to renew its exploration contract on offshore blocks 2714A and 2714B offshore.

The announcement was made via a statement on Tuesday. According to this document, management explains that this decision is part of its policy to better manage its portfolio and impose a certain financial discipline. The other important reason for this withdrawal is the fact that the company has not found a partner to reduce costs during the next development phases. “Although it is clearly disappointing that we were not able to attract a partner in these blocks, it is important for us to maintain financial discipline and risk management (...) Our operational goal is to prepare the drilling program In Morocco, to make progress in drilling preparations in the central blocks in Namibia and to launch the partnership process in Brazil. Thank Namcor and the Ministry of Energy and would it continues to facilitate our efforts to advance our drilling program. “ Said Larry Bottomley, CEO of Chariot.

A notification of this decision was made to the Namibian Ministry of Energy and the process of validation of the withdrawal was initiated.

Chariot operates these two blocks with 85% interest. The Namibian oil company controls 10% and Quiver, a local exploratory firm, the rest.

Eni Angola has awarded Saipem work orders in relation to the West Hub Development project as an addition to those previously assigned during 2016 and 2017.

The work, which will be performed by the E&C Offshore division, encompasses the construction and subsequent installation in deep waters of umbilicals, risers and flowlines (Deep Water SURF) required for the development of Block 15/06, located 350 km north west of Luanda and 130 km west of Soyo.

Furthermore, in the framework of its Maintenance, Modifications and Operations (MMO) activities, once again in the Offshore E&C sector, Saipem has acquired from Eni

36 Orient Energy Review Vol 6 No.08 September 2017

Ghana Exploration & Production a contract for the engineering, procurement and construction of the infrastructures needed to boost the capacity of the gas stations situated in the vicinity of the ports of Takoradi and Tema in Ghana.

Finally, among the new acquisitions a contract has been assigned by Nord Stream 2 for the construction of the last section of the pipeline crossing the Baltic Sea and the shore approach in Greiswald, Germany.

The combined value of the above-mentioned new contracts is approx. USD 370 million.

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LOGISTICS & MARITIME

opportunities are coming. How are we taking advantage of the natural vantage position we have found ourselves, Amaechi said.

Nigeria LNG Road Delivery Scheme to Provide Cheaper Fuel

Speaking also, the Chairperson, Ship Owners Forum, Mrs. Margaret Orakwusi said lack of access to cheap funding has been the bane of shipping in Nigeria.

She hinted that shipping in Nigeria may remain uncompetitive if foreigners continued to enjoy a one digit interest rate against the double digits loan available to Nigerian shippers. “How do you compete with people who get very cheap funding such like one and half to two per cent interest rates? And we are here struggling to do business with 20 per cent.”

Charting the way forward, the Chairperson called for the establishment of a maritime bank and that the Cabotage Vessel Finance Fund (CVFF) should serve as the seed money. “We have money under the law that we have been putting aside and that is the CVFF. We need our own bank that will understand that we need to grow and that it is not profit-oriented.

“We need a bank that will understand the type of business we do. When you take a loan and the bank is giving you two years, it makes no sense getting the loan.

And that is why we believe that we need our own bank, a maritime bank that will finance ship building, ship yard, among others. And that this money should act as seed money, she posited.

The convener, Mrs. Ezinne Azunna in remarks said that the cocktail parley was for stakeholders brainstorm, and see how ship financing and maritime infrastructure can be best done. Azunna who noted that Nigerian maritime industry is vast and with huge potentials, however said “any nation without vessels is not competitive in the foreign space.”

“So, if Nigeria is unable to have ships, how can we say that we are a maritime nation. Now if we have ships, what are the advantages. Ship financing is broad, the money required to acquire vessel is pretty huge and over years we have tussles in the industry.

Is it possible to get ship financing and maritime infrastructure going, to leverage on what we have. How can we rally round and get this fund together and empower our people to get vessels because there are huge potentials in this line and we must move from talk shop. It is time for us to come together and say, do we want this to work, she said.

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igeria has launched a scheme to transport liquefied natural gas (LNG) to regions not linked by pipeline, supplying power plants and industry with cheaper, cleaner fuel, officials said.

Nigeria, a major oil producer, lacks refining capacity, so most crude is exported and the West African nation imports gasoline and other refined products. A creaking power network also means firms often rely on expensive diesel generators.

The government has said it wants to use more of its gas.

Under the new plan, the state oil firm, the Nigerian unit of France’s Total and Gas Aggregation Company Nigeria Ltd (GACN) would deliver gas to a small LNG plant run by Nigeria’s Greenville LNG, officials said in speeches at the launch.

Greenville would deliver the gas to industries and companies around the nation using trucks

which would themselves be powered by LNG, the officials said.

“Greenville will transport products with specialized LNG trucks, which have the capacity to travel about 1,000 km on LNG before refueling,” GACN Managing Director Morgan Okwoche said.

He said LNG was cheaper and lighter to transport than other fuel, so would damage roads less.

The trucks could supply areas not linked by pipeline to create what he called a “virtual pipeline” network.

Nigerian Oil Minister Ibe Kachikwu said investors “have been looking for how to be able to access and distribute gas in the absence of pipelines.”

“This is not to take the need away from the pipelines, we are going to continue to work on providing pipelines,” he said.

Orient Energy Review Vol 6 No.08 September 2017 37

LOGISTICS & MARITIME

Nigeria And Morocco Make Progress On Pipeline Project To Link The Two Countries

Maritime Dev’t: Actionable Concepts Needed to Transform Potentials Into Opportunities Transport Minister

By Oge Obi

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ccording to the Nigerian press, the funds to carry out the feasibility study of the gas pipeline project between Nigeria and Morocco have been unblocked by both countries.

However, the date for launching the work was not specified, but several experts from both countries were involved in this phase.

Nigerian President Muhammadu Buhari and Moroccan King Mohammed VI signed a strategic partnership agreement and a Memorandum of Understanding (MoU) on December 3 to build this infrastructure, which is expected to span 4 000 km, cost 25 billion dollars and cross about fifteen countries. According to Moroccan sources, the project will create “tens of thousands of jobs. “ .

In Nigeria, gas pipeline vandalism is at the root of defects in the supply of natural gas to countries like Ghana via the West African Gas Pipeline. The country is struggling to produce enough gas to power its power stations and, for the time being, no plan to improve production has been adopted. All these factors lead to questions about the viability of the gas pipeline project with Morocco.

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he Minister of Transportation, Mr. Rotimi Amaechi has called on the Nigerian shippers and other stakeholders in the maritime industry to rise to the challenge of transforming the huge potentials in the industry into opportunities economically beneficial to the country and her citizenry.

The minister who was represented by the Director General, Nigerian Maritime Administration and Safety Agency (NIMASA), Dr. Dakuku Peterside made this known at a cocktail parley for stakeholders in ship/ maritime infrastructure financing in Lagos recently.

According to him, it is high time operators and stakeholders applied their mind to knowledge, developed necessary skills and actionable concept that can translate dreams to economic benefits and opportunities.

“The emphasis for the conference is actionable concept. So, the thematic thrust of this is not the theoretical framework but practical actionable concept that can translate dreams to economic benefits and opportunities.

“I am very proud to say that the

38 Orient Energy Review Vol 6 No.08 September 2017

journey is in the right direction. All we need is the support, encouragement, critical and strategic partnership that will translate our vision to true opportunities that our people will benefit from.

Speaking on ship financing, the minister said that government is working on getting the private sector to drive the engine of growth whether it is ship building or in any economic activity. And that through NIMASA, government is willing to partner with anybody that has “the concept that can change our story.”

“We are taking practical steps and in the interim, we are engaging Central Bank of Nigeria and NNPC. We want to change the terms of trade from FOB to CIF. But how many persons are prepared for the new regime?

“Now NIMASA is working on Cargo Support Initiative so that our national shippers will have the exclusive right to take our cargoes. You must to develop concepts, you must develop

action plans to take advantage of the opportunities that are coming. Because indeed,

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Orient Energy Review Vol 6 No.08 September 2017 39

GAS

Baker Hughes Secures Second Major Contract For Eni’s Coral South FLNG

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aker Hughes, a GE company (BHGE), has announced a second major contract for Eni East Africa’s (EEA) Coral South FLNG development, offshore Mozambique, underlining the company’s position as the world’s first and only integrated fullstream provider of products, services and digital solutions that maximize productivity, efficiency and cost reduction.

The contract was awarded in 2Q this year by a joint venture formed

by TechnipFMC and JGC Corporation, the lead partner in a consortium that will provide engineering, procurement, construction, installation, commissioning and start-up (EPCIC) of Coral South’s FLNG facility.

The second contract - which was awarded through the former GE Oil & Gas business - will allow BHGE to provide rotating equipment for the power and gas refrigeration process of the new FLNG facility. The order consists of four Turbo-compression trains for mix refrigeration services, using the company’s aeroderivative gas turbine (model PGT25+G4) technology and driving its centrifugal compressors. In addition, the company will provide four Turbo-generation units, also driven by aeroderivative gas turbines (model PGT25+G4).

The components of the turbo compressor trains and turbo-generation units will be manufactured at BHGE Nuovo Pignone facility in Florence, Italy, where the train will be assembled and tested in the Massa facility.

Demonstrating the benefits for customers of BHGE’s access to the GE Store – where the company can draw on technologies (such as the gas turbines derived from the Aviation business) and expertise from multiple industries – the Turbo-generation units will be equipped with electric generators provided by the GE Power Conversion business.

A third contract was also awarded to BHGE after the closing of the integration between GE Oil & Gas and Baker Hughes last July and it includes the supply of Boil-Off

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Gas (BOG) and booster compressors capable of operating at -180° C to re-liquefy excessive BOG evaporating out of the LNG storage tanks.

In particular, BHGE boil-off gas compressor draws on extensive in-field experience and has been validated through a dedicated experimental campaign of detailed analysis and testing.

“Coral South LNG is an enormously important development for Mozambique and the region – the first new-built FLNG facility to be installed in Africa and one of only a small number in the world today,” said Rod Christie, President and CEO, Turbo machinery & Process Solutions, BHGE. “These awards further underline BHGE’s position as a full stream provider of smart, cost-effective advanced technology and solutions to drive reliability, flexibility, efficiency and productivity for major energy developments, while building on our relationships with oil and gas operators and our technical expertise that has been a true differentiator in this project.”

The contracts won by BHGE follow an earlier award in June this year for the supply of seven xmas trees, three 2-slot manifolds with integrated distribution units, MB rigid jumpers, seven subsea wellheads with spare components, a complete topside control system to be installed on the Coral South FLNG facility, and associated Services equipment and support including IWOCS and Landing Strings, tools, spares and technical assistance for installation, commissioning and start-up.

BHGE announced on July 3rd the completion of the transaction combining GE’s oil and gas business with Baker Hughes. The new company is the first and only to bring together industry-leading equipment, services and digital solutions across the entire spectrum of oil and gas development.

The Coral South FLNG project, the first phase of EEA’s wider plan of development for the world-class gas discoveries made in the Rovuma basin Area 4, will see the installa-

tion of an FLNG facility with a capacity of around 3.4 MTPA, fed by six subsea wells and expected to produce around 5 Tcf of gas during its 25 years of production, with an anticipated start-up in mid-2022.

The first ever offshore project to start producing gas in Mozambique, it will provide significant local economic benefits through job creation and support the region’s future energy needs.

EEA is the operator of Area 4, and holds 70% participation interest in the Area 4 Concession. Eni (71.43%) and CNPC (28.57%) are shareholders of EEA.

Ghana Wins Major Import Contract for LNG with Equatorial Guinea Ghana has just signed an import agreement with 150 to 200 million cubic feet a day for 15 years with Equatorial Guinea. Formed in the form of a Memorandum of Understanding, it was initialed by Ghana’s Energy Minister Boakye Agyarko and his Equatorial Guinean counterpart Gabriel Mbaga Obiang Lima.

According to the Ghanaian Energy Minister, “this agreement will mark the stability of Ghana’s power generation, promote low electricity production costs and, therefore, set lower tariffs for consumers . “ This contract is a giant step towards reaching the objectives of the Ghanaian electricity sector because the imported LNG will be mainly devoted to the production of electricity.

Ghana had signed an import agreement for LNG via Nigeria’s West African Gas Pipeline Company (WAGPCo). But because of the acts of sabotage in the Niger Delta, Nigeria’s main gas production basin, it almost never receives the necessary volumes. Instead of 120 million cubic feet of gas per day, Ghanaian terminals receive only 30 million cubic feet of gas per day.

This has a negative impact on its ability to generate electricity from gas. This is what has led the authorities to turn to other sources of supply. www.orientenergyreview.com

GAS

Nigeria: Govt signs $500m MoU for mini-LNG Plant

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he Nigeria Government, recently, signed an agreement with National Petroleum Corporation, Total Exploration and Production Nigeria Joint Venture and Greenville Energy for a mini-Liquefied Natural Gas plant.

The agreement would see the construction of the plant in Rumuoji, Rivers State, with an investment outlay of $500 million.

Speaking during the signing of the Gas Sale and Aggregation Agreement in Abuja, Minister of State for Petroleum Resources, Mr. Ibe Kachikwu, said the agreement would allow the movement of gas across the country.

He also stated that with the absence of adequate pipeline network in some areas of the country, the agreement would help in transporting gas to critical industries.

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Managing Director of the NNPC, Mr. Maikanti Baru, said the agreement would allow it increase its gas output to 1.6 billion standard cubic feet (BCF) and also boost gas supply for domestic consumption and power supply.

He further stated that the agreement would unlock existing opportunities in terms of gas supply to power companies, adding that the initial capacity of the mini-LNG project is 2,200 metric tonnes and has the capacity to grow to about 5,000 metric tonnes.

He said the Federal Government would address the challenges of payments and would ensure that payments are made on time for gas supplied under this arrangement.

He said the Federal Government is looking at increasing gas supply to the northern part of Nigeria, where a number of industries are closing shop because of the absence of electricity.

Speaking in the same vein, Group

Baru, who was represented by the Managing Director, Gas, and Power Investment Company, Mr. Sam Ndukwe, said Total would provide the gas feedstock, while the NNPC would create the enabling environment for the project to succeed by building more pipeline and increase access to gas supply.

He also added that the agreement is in line with its plans to increase its power generation target from one gigawatt to six gigawatts.

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TECHNOLOGY

Nestoil to Showcase Superior Technology at International Pipeline Conference

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igeria’s indigenous leader in pipeline construction, Nestoil Limited is set to take advantage of the Nigerian International Pipeline Technology and Security Conference (NIPITECS) holding in Abuja from September 13-14, 2017 to showcase its innovative technology and expertise in pipeline construction.

The company, which has acquired reputation for executing complex projects and working in challenging terrains, has described the conference as a veritable platform for collaboration and an avenue for showcasing the capacity of indigenous companies operating in the pipeline construction, engineering, operation and maintenance subsector of the Nigerian Oil and Gas sector.

Speaking on the company’s participation at the conference, its Executive Director, Dr. Umeh said that “a conference like this provides an avenue for pipeline construction companies in Nigeria to showcase their response to the socio-environmental challenges that have made pipelines less optimal in Nigeria”.

He added that “In response to these challenges, Nestoil has embarked on significant investments in acquisition of state-of-the-art machinery and technology, which guarantee higher level of security for laid energy pipes against vandalism and explosion”.

With technological innovation, Nestoil has made three major river and several road crossings, using the Horizontal Directional

Drilling (HDD) technology. The HDD, a trenchless technology that curbs vandalism, limits environmental degradation and ensures safe depth of pipelines burial, is the latest pipeline technology deployed by the company in execution of its pipeline projects. By this, Nestoil has signalled its capacity to deliver crude oil and gas pipeline construction contracts to world-class quality and standards. Unlike the conventional practices that resulted in demolition of houses, displacement of people and destruction of natural habitats, deploying the HDD technology shows significant consideration for the society, environment and mankind in the multi-layered engineering planning processes upon which the project implementation rests.

Nestoil is acknowledged for its inventiveness and seamless execution of landmark projects in Nigeria. Some these projects include the construction of the Edjeba Sewage Treatment Plant in Warri, construction of the 24” diameter Nember-Cawthorne Channel Trunckline (NCTL) for Shell Petroleum Development Company, construction and installation of the 2.5km Escravos River Cross as part of the OML 42 oil export pipeline network construction for the Nigerian Petroleum Development Company (NPDC).

of the OB3 (Obiafu/Obrikom to Oben) 48” diameter gas pipeline project for the Nigerian National Petroleum Corporation, with the attainment of impressive milestones and feats that hitherto were exclusive to international construction companies.

Over the past two decades, the company has established itself as a dependable partner in Nigeria’s quest for national development and economic empowerment.

In providing highly technical specialist services which include pipeline and flowline construction, Horizontal Directional Drilling for Pipeline Construction, Production facilities operation and Engineering Consultancy, we have consistently demonstrated commitment to the growth of the Nigerian economy.

Unarguably the largest indigenous Engineering, Procurement, Construction and Commissioning (EPCC) services provider for major International Oil Companies (IOCs) in Sub-Saharan Africa, Nestoil Limited has contributed significantly to the development of the oil and gas industry in Nigeria. The company is founded on its capacity to execute and deliver projects in any terrain and location, enabled by its effective community relations and stakeholders’ engagement strategy.

The acclaimed expertise which distinguished Nestoil from other industry players has become manifest in its execution

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