January edition

Usan, Agbami share from Chevron's $35.8bn upstream spend P/6

Compliance with rules, regulations is our core value —Siemens Nigeria Boss

P/10

A Review Of The Nigerian Energy Industry January, 2014

VOL 01 N0. 11

U P DAT E S MONTHLY BASKET PRICE DEC-13 OCT-13 OCT-13 SEP-13 AUG-13 JUL-13 JUN-13 MAY-13 APR-13 MAR-13 FEB-13 JAN-12 DEC-12

107.31 104.97 106.69 108.73 107.32 104.45 101.03 100.65 101.05 106.44 112.75 109.28 106.55

Daily | Weekly | Monthly | Yearly OCT-12

108.92 U$

114 112 110 108 106 104 102 100 Dec-12 Jan13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13

Nigerian contractors should demand for bigger projects, says Nwapa

M

r. E r n e s t N w a p a , executive secretary of the Nigerian Content Development and Monitoring Board, NCDMB, has urged local Nigerians contractors in the oil and gas sector to demand for bigger projects.

Nwapa who hailed Nigeria's progress so far, in term of shoring up local content in oil and gas operations, was, however, of the view that the nation was still far from achieving the highest possible level in that regard.

He spoke at the event to mark the successful completion of the detailed engineering of the offshore living quarters of the Floating Production Storage Offloading, FPSO, for Total’s $13.35 billion Egina project.

The NCDMB boss, who maintained that his board was put in place to create increased capacity for local Nigerian

CONTINUES ON PAGE 7

www.sweetcrudereports.com

Nigeria's failed

Gas

Revolution Lofty targets, zero delivery

P/25

$1.68bn Deal: Oando set to become largest local E&P firm

Contents

02

2014 January, SweetcrudeReports

Editor’s note

F

inally, we are in 2014, the 'appointed' year for Nigeria's greatness in natural gas and gasrelated industries. Three years ago, the Federal Government had launched its famous Gas Revolution project with plenty of buzz and hype. At that launch, an excited Petroleum Minister Diezani Alison-Madueke and jubilant President Goodluck Jonathan had painted a picture of Eldorado for Nigeria on account of the gas master-plan.

Promises were aplenty: Nigeria would become the undisputed regional hub for gas-related industries within three years; the plan would mark the beginning of the end of gas flaring in the country, the master-plan will result in about $25 billion worth of investments in gas processing, transmission and downstream utilisation projects, it will make available increased volume of gas to power stations, in the process ensuring stable power supply and creating the undertone for even more widespread wealth, it will result in widespread availability of LPG and significant reduction in LPG price, widespread availability of LPG will displace as much as 60 per cent of the eight million litres of kerosene consumed daily for household use, the replacement of firewood by the much cleaner LPG will reduce deforestation and desertification, natural gas will replace fuel oil as fuel for industrial boilers etc.

"By 2014, we would have positioned Nigeria firmly as the undisputed regional hub for gasbased industries such as fertiliser, petrochemicals and methanol. We would by then, be producing enough fertiliser to create a self-sufficient country and a net exporter of fertiliser and food to the world. We would be the leading regional centre for petrochemical production

and manufacture of petrochemical-related products both for local and export use," President Jonathan added.

It is three years down the road and the year by which all these would be accomplished.

But, nothing on ground shows anything had happened that will lead to the realisation of these targets this year. In place of visible progress, the entire process has stymied, mired in controversy, inconsistencies and poor implementation. Indeed, one industry observer captured it succinctly when he described the situation on ground as a case of 'lofty targets but zero delivery'. That's another way of saying the project has failed. And we can't agree less.

On a brighter note, however, it is good news that in the face of general apathy by the multinationals to investing in the Nigerian oil and gas sector due to alleged policy inconsistencies, poor leadership and uncertainty in the sector, the super major Chevron has devoted a good chunk of its $35.8 billion 2014 upstream spend for the Usan and Agbami projects.

These and more in this edition, including news of Wale Tinubu and his Oando Plc, which is set to become the largest indigenous E&P company in the country. The news about Chevron and Oando are welcome developments which serve as brilliant sparks of hope.

We welcome you to 2014. We say thanks to you all - our readers, partners and advertisers, who were with us in the outgone year. Please, stay with as we continue to work to satisfy you through our three platforms: SweetcrudeReports Monthly, SweetcrudeReports in The Guardian and SweetcrudeReports online.

4 6 10 12 19 25 30 33

COVER

36 39 42

FREIGHT

44

Nigeria’s failed gas revolution

OIL Usan, Agbami share from Chevron’s $35.8bn upstream spend

FOCUS Compliance with rules, regulations is our core value—Siemens Boss

GAS Rest kerosene, adopt cooking gas, PPMC urges Nigerians

POWER

NIPPs bids: Financial evaluation to be unveiled this month

FINANCE Government to reap $1bn in income tax from NLNG

LABOUR

Labour to FG: Don’t privatise refineries, deal with PIB

SOLID MINERAL

Nigeria awaits fresh development funds from World Bank

UK, Nigeria firms partner to secure Lagos anchorage

MOTORING 2014 SUV Buying Guide

TECHNOLOGY

How utility electrical distribution networks can save energy in smart grid era

COMMUNITY

SNEPCO takes Corporate Social Responsibility to Old Citizens

EDITORS Hector IGBIKIOWUBO Chuks ISIWU ASSISTANT EDITORS Yemie ADEOYE Toju VINCENT Eluonye KOYEGWUAEHI

GM, Marketing SNR. CORRESPONDENTS Oscarline ONWUEMENYI Nkem IGBIKIOWUBO Chima UGWUANYI +234 08060249746

Design/Layout Frontline Concept

Printed and Published by Sweetcrude Limited Plot 2191 Osiefa Crescent, ‘Amuwo Odofin, GRA, Lagos.

WEBSITE: www.sweetcrudereports.com Enquiries? Call: +234 08023145252

2014 January, SweetcrudeReports

03

Cover Story OSCARLINE ONWUEMENYI

F

ew government programmes have generated the amount of buzz and hype like the Gas Revolution project announced nearly three years ago by the Federal Government, and even fewer have seemingly evaporated into thin air quicker.

President Goodluck Jonathan had stated at the launch of the ‘Gas Revolution: Rebirth of Industrialisation’ in March 2011 that the agenda would deliver the country from hopelessness and reposition it to b e c o m e t h e industrial giant of the African continent. But, three years since t h e g r a n d announcement and elaborate launch event, the Gas R e v o l ut i o n A g e nd a ha s stymied, mired in controversy, allegations of corruption, inconsistencies and poor implementation.

Highlight of the launch of the agenda, which was expected to propel the achievement of the National Gas Master-plan, was the signing of Memorandum of Understanding, MoU, between the Nigeria National Petroleum Corporation, NNPC, and representatives of two foreign investors, namely Xenel of Saudi Arabia and Nagarjuna of India; and Chevron Nigeria Limited.

Two other companies, Oando Nigeria Plc and Agip, were awarded contracts for the development of the anchor Central Processing Facility, CPF, to be located in Obiafu, Rivers State and Warri, Delta State.

What they said Jonathan had stated at the launch in the Federal Capital, Abuja, that with the full implementation of the gas master-plan, the Nigeria would become the undisputed regional hub for gas-related industries within three years.

He further assured at the launch that the plan would mark the beginning of the end of gas flaring in the country.

According to the president, full implementation of the e n t i r e g a s m a s t e r- p l a n agenda would in fews years

2014 January, SweetcrudeReports

Nigeria's failed Gas Revolution Lofty targets, zero delivery

result in about $25 billion worth of investments in gas processing, transmission and downstream utilisation projects.

President Jonathan said: "As a nation, we are continually striving to realise the fullness of our potential.

Very few nations can boast of the resources we have, both natural and human. Our proven gas reserves base of

Nigerians".

Regional hub for gas "Today we take a small but important step in a conscious effort to reverse that trend.

Today marks the beginning of what I believe will be an amazing journey of transformation of our own

By 2014, we would have positioned Nigeria firmly as the undisputed regional hub for gas-based industries such as fertiliser, petrochemicals and methanol. We would by then, be producing enough fertiliser to create a selfsufficient c o u n t r y

187 trillion cubic feet and a further undiscovered potential of 600 trillion cubic feet, leave us with no excuse for the relatively high rate of unemployment and underindustrialisation.

destiny and the restoration of Nigeria into the league of nations which have leveraged their strength in the abundance of natural gas, to transform the lives of present and future generations of

"By 2014, we would have positioned Nigeria firmly as the undisputed regional hub for gas-based industries s u c h a s f e r t i l i s e r, petrochemicals and methanol. We would by then, be producing enough fertiliser to create a selfsufficient country and a net exporter of fertiliser and food to the world. We would be the leading regional centre for petrochemical production and manufacture of petrochemical-related products both for local and export use," President Jonathan had stressed.

On her part, Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, said the boost in the production of liquefied petroleum gas, LPG, from the proposed land-based Central Processing Facilities, CPF, to be located in Obiafu, Rivers State and Warri, Delta State, will result in widespread availability of LPG and significant reduction in LPG price.

She said: "We believe that

04

this will displace as much as 60 per cent of t h e eight millio n litres of kerosene consumed daily for household use.

The replacement of firewood by the much cleaner LPG w i l l r e d u c e deforestation and desertification.

Natural gas will replace fuel oil as fuel for industrial boilers. Above all, this agenda sets the tone for the final stop of gas flaring in Nigeria as the markets created provide a sink for all currently flared gas".

Alison-Madueke maintained that the gas revolution also comprises government’s ongoing efforts in gas-to-power. "Based on the various steps that were taken last year to reposition the commercial framework for gas in the domestic market, I am confident that we now have in place, a more sustainable framework to assure gas availability to P o w e r. T h e i m p a c t i s becoming evident as we witness a great improvement in gas supply performance relative to last years. Our power agenda will create the undertone for even more widespread wealth," she added.

What is on ground Investigations by SweetcrudeReports have revealed that three years into the much-heralded Gas Revolution agenda, what is so far on ground does not reflect the lofty targets set by the government. As one industry o b s e r v e r, w h o c r a v e d anonymity put, "it is a case of lofty targets, zero delivery."

Matters are made worse even by the blatant refusal of government officials, including those at the Nigerian National Petroleum Corporation, NNPC, to discuss the state of the ‘Revolution’. Calls and text messages sent to the GSM number of the NNPC, Group Executive Director in charge of Gas, Dr. David Ige, as far back as November last year were not replied up to the CONTINUES ON PAGE 5

Cover Story

2014 January, SweetcrudeReports

05

Nigeria's CONTINUED FROM PAGE 4 time of going to press.

Checks revealed that the government has failed to achieve any of the targets it set at the launch of the gas revolution and indications are that none of these targets may be met in the next 5 years given government's current disposition towards investors.

Contrary to the pronouncements of both the president and the minister of petroleum resources, gas flaring continues at various fields in the Niger Delta and offshore while efforts at supplying gas for power generation has fallen far short of expectations, resulting in continued poor power situation across the country.

Mid last month, national electricity supply was reported by the Minister of Power, Prof. Chinedu Nebo, to have dropped by 22 per cent due to lack of gas to power the nation's electricity generating plants, though the minister blamed the situation on "constant destruction of key gas-to-power infrastructure" by vandals.

In what many consider a major blow to the government's gas revolution, Chevron Nigeria Limited, CNL, and Shell Petroleum D e v e l o p m e n t C o m p a n y,

failed Gas Revolution SPDC, both major players in the nation’s oil and gas industry, last August pulled out of the consortium of companies promoting the Olokola Liquefied Natural Gas, OKLNG, project, with the NNPC as the principal partner. Both companies cited reasons for quitting the project to include lack of progress on the project eight years after its launch and non-commitment of the Federal Government to pursuing its completion as well as non-passage of the Petroleum Industry Bill, PIB, by the National Assembly. The US company, ConocoPhillips, another partner in OKLNG, had earlier pulled out of the project as it divested from Nigeria, citing inclement

environment.

Recently, the Nigeria Gas

Mid last month, national electricity supply was reported by the Minister of Power, Prof.

Chinedu Nebo, to have dropped by 22 per cent due to lack of gas to power the nation's electricity generating plants, though the minister blamed the situation on "constant destruction of key gasto-power infrastructure" by vandals

Association, NGA, comprising stakeholders in the gas business in the country, passed a verdict on the gas revolution plan, declaring that it was still very far from meeting the expectations of Nigerians as it called for increased efforts from government at actualising the agenda.

According to Chima Ibeneche, President of NGA, turning natural gas into a profit-making venture requires huge investments in infrastructure that address the five component areas of g a s a v a i l a b i l i t y, g a s affordability, deliverability, funding, and the legal and regulatory framework.

The NGA boss who was speaking at a conference tagged "The Gas Revolution: Industry feedback on the gains, challenges and opportunities", decried numerous clogs in the government agenda to reposition the natural gas sector to support rapid economic growth, noting that challenges with the policy was making it difficult to achieve effective links between the gas sector and other economic areas such as industries, agriculture and human development as well as driving local content and indigenous participation.

Oil

2014 January, SweetcrudeReports

06

Usan, Agbami share from Chevron's $35.8bn upstream spend CHUKS ISIWU

T

he Usan and Agbami fields in N i g e r i a ' s deepwaters are some of the global projects expected to share from Chevron Corporation's $35.8 billion upstream spending this year.

The US super major plans the multi-billion dollar upstream spending in 2014 for major capital projects in Nigeria, Angola, the Republic of Congo, United Kingdom, Canada Australia and Argentina.

The company's plan for Nigeria involves a further development of the giant Usan and Agbami fields.

The Usan field in OPL 222 is located approximately 62 miles (100 kilometres) off the coast of the Niger Delta in water depths of about 2,400 feet (750 metres). First oil from the field in 2012 boosted Nigeria's daily oil production by 80,000 barrels per day.

Chevron Petroleum Nigeria Limited controls 30 per cent stake in the project, while Total E&P Nigeria Limited is the operator on behalf of the Nigerian National Petroleum Corporation, NNPC, with 20 per cent stake, while Esso E&P Nigeria Limited holds 30 per cent and Nexen Petroleum Nigeria Limited, 20 per cent as partners.

Discovered in late 1998, Agbami was the second major deepwater oil find off Nigeria's Niger Delta', the first being Bonga field by Shell.

Between them, Usan and Agabami form part of the strategic projects Chevron has been pursuing towards realising its production potentials. A further injection of funds in their further development is aimed at realising the production potentials.

Specifically, the $35.8 billion, which Usan and Agbami will share from, is part of the $39.8 billion capital and exploratory budget for 2014, which includes $4.8 billion of planned expenditures by

Usan

affiliates, which do not require cash outlays by Chevron.

The 2014 budget is

budget.

M r. J o h n Wa t s o n , Chairman and Chief Executive Officer of Chevron

Planned capital spending is also directed toward improving crude oil and natural gas recovery and reducing natural field declines from existing producing assets throughout the world approximately $2 billion lower than expected total investments for 2013. For the current year, total investments are estimated at $42 billion, including e x p e n d i t u r e s o f approximately $4 billion for major resource acquisitions not included in the original

Corporation, said the company had expected that 2013 would be a relative peak year for investments, as it completed several attractive resource acquisitions.

But, he added: “We also anticipate 2014 will represent the peak year for spending on our Australian

LNG projects as we move them closer to first production. Overall, we have an attractive portfolio of investment opportunities which we will continue to fund in a disciplined fashion to grow value and shareholder distributions”.

A

bout 90 percent of the 2014 spending programme is budgeted for upstream crude oil and natural gas exploration and production projects. Another eight percent is associated with the company’s downstream businesses that manufacture, transport and sell gasoline, diesel fuel and other refined products, fuel and lubricant additives, and petrochemicals.

A breakdown of the c o m p a n y ’s s t a t e m e n t showed that investment of $35.8 billion was planned for exploration and production activities. Major capital

investments include developments in Australia, Nigeria, the United States deepwater Gulf of Mexico, the United States Permian Basin, Kazakhstan, Angola, and the Republic of the Congo.

Planned capital spending is also directed toward improving crude oil and natural gas recovery and reducing natural field declines from existing producing assets throughout the world. About 30 percent of the upstream capital programme is allocated to highly profitable development wells and other projects associated with current producing assets.

The 2014 base programme includes an increase in a ct i v i t y a cr o ss se v e r a l producing regions of North America as well as in Thailand and Indonesia.

CONTINUES ON PAGE 7

Oil

2014 January, SweetcrudeReports

07

Marginal field bidding firms must be 51% owned by Nigerians - DPR SAM IKEOTUONYE

T

he Department of Petroleum Resources, DPR, has stressed that the 31 oil fields on offer under the current licensing round for marginal fields, which opened few weeks ago is meant for Nigerian companies whose 51 per cent equity shares must be owned by Nigerians.

The DPR director, Mr George Osahon disclosed this as he outlined the conditions under which bidding companies would be awarded oil fields under the bid round.

According to him, the condition regarding 51 per cent equity ownership by Nigerians was part of the guidelines outlined by the government so as to attain the overall objectives for the bid round, which include, not only to grow national production but to raise the capacity of Nigerian companies playing in the upstream sub-sector of the petroleum industry.

Listing other aspects of the guideline, he said: “Any company that is bidding this time around cannot have any promoter that has more than 25 per cent shares in the company, also among the promoting team, shareholders, you must have at least one of them being somebody who is experienced in upstream, that is exploration and production components".

Osahon explained that

effort was made under the current bid round to avoid the experience from the 2003 exercise, where companies awarded fields were yet to develop them 10 years after.

Said he: “One of the issues we have had so far is that people get fields, 10 years after they get the field, they have not done a thing. If you recall, marginal field by definition means a field that has been discovered by major IOCs and 10 years thereafter they have not developed those fields.

We take those fields from IOCs give them to Nigerian companies and another 10 year down the road those fields have not been developed and then you ask yourself what is the difference.

“We do not want to give these assets out and wait for another 10 years for them to be developed, therefore we have indicated again as one of the conditions, if you get a field within two years of getting it you should have done something. If you have not, the powers-thatbe will take the field from you”.

The DPR boss also stressed the need for bidding companies to have access to required funding, saying those in charge of awarding the fields must be able to see clearly from the information provided by the bidders that they (the bidders) have access to finance.

Nigerian contractors should demand for bigger projects, says Nwapa CONTINUED FROM PAGE 1 players as well as get increased level of work in the sector done in-country, said: “I just believe that in an FPSO project, that coming to have a big party like this for detailed engineering could send a wrong signal that we are already satisfied.

"We are not yet satisfied. So, as Nigerians, we are looking for bigger projects. Let us always take one project, put it in our pocket and ask for more. That is what we continue to say to Nigerian engineering contractors, fabricators and all our companies that are working in the industry”.

Still, he maintained that the completion of the detailed engineering for the Egina FPSO by a local contractor was a big step forward and should, therefore, be applauded.

“We are not just interested in seeing this project as if it is a dash, but as something that has become part of our way of doing business.

We want to see it done in such a way that we layer it.

"We layer Ofon and then we layer Egina on top of Ofon and we put our learning together, so that we do not dissipate that, which we are doing. I am very sure that Samsung knows this because this is the way they themselves became a big international company,” Nwapa stated.

Bribery and subterfuge were alleged to have characterised last year's award of the contract for the Egina FPSO to the South Korean company, Samsung.

The Nigerian National Petroleum Corporation, NNPC, was said to have set aside its three-tier contract tendering process to ensure the South Korean firm grabbed the contract.

Bribery allegations were levelled against Samsung officials, a ranking official of the Ministry of Petroleum Resources, a relation of the ministry official and officials of the NNPC, who were alleged to have actively aided the subversion of the corporation's contracting process to favour Samsung.

Usan, Agbami share from Chevron's $35.8bn upstream spending CONTINUED FROM PAGE 6 In Australia , the Gorgon project has been under construction for four years and is almost 75 percent complete.

The current estimate for the cost of the foundation project is $54 billion ($55 billion), with plant startup and first gas planned for mid-2015.

The Vice Chairman of Chevron, Mr. George Kirkland said the Gorgon project economics were attractive.

“We continue to make steady progress against key project milestones and are applying lessons learned to our Wheatstone development which is almost 25 percent complete. Approximately 75 percent of our combined LNG offtake from the two projects is committed under firm,

long-term sales and purchase agreements.

These LNG developments are two of our most important future legacy assets, representing approximately 400,000 barrels a day of net production at full capacity. They will be substantial contributors to our cash flow for decades to come,” he said.

Kirkland noted: “Our focus is on developing resource projects that grow shareholder value. For instance, we are steadily increasing activity levels to develop shale and other tight resources in Canada’s Duvernay, the Vaca Muerta in Argentina and the Permian Basin of the United States. We are very pleased with our global unconventional acreage position”.

Oil

2014 January, SweetcrudeReports

08

Nigerian Navy vessel

Navy says surveillance cameras will help combat oil theft

C

hief of Naval Staff, Vice Admiral Dele Ezeoba, has hailed the installation of surveillance cameras along the Nigerian territorial waters, saying this will help monitor vessels and combat crude oil theft.

Admiral Ezeoba, who disclosed this while commissioning the Regional M a r i t i m e Aw a r e n e s s Capability Centre, RMAC, in Yenagoa and Brass, both in Bayelsa State, stated that the top technology equipment would avail the Navy the ability to ensure effective surveillance of the nation's territorial waters. ‘’What we have done is that we have added impetus to our capacity to deliver on Mr. President’s mandate. The domain awareness centre satisfies the requirement of one of the legs of our trinity of action, which is surveillance capability. ’’We can identify vessels in accordance with IMO classification that says every vessel that is registered and is

a flagged vessel must have Automatic Identification System, AIS. That gives you the total character of the vessel and what she is supposed to be doing.

"Where we find that such vessel does not have such AIS identification, what we do is to begin to question its authenticity,” the Navy chief further stated.

Disclosing that the equipment has been

installed all across the nation’s coastline, Admiral Ezeoba maintained that with the RMAC centre, it would be easier for the Navy to identify and classify vessels according to the International Maritime Organization, IMO, standards.

According to him, the challenge before his officers and men at present was the capacity to respond to the threats posed by ‘strange

vessels’ and the ability to sustain the hi-tech equipment that had been installed.

The Chief of Naval Staff also listed the capacity of the judiciary to try and prosecute suspects arrested as another challenge in the effort to eradicate criminality in the Nigerian territorial waters.

BPE assures on transparent privatisation of refineries

T

he Bureau of Public Enterprises, BPE, has assured of a transparent process in the plan to sell the nation's four refineries in Warri, Kaduna and Port Harcourt.

“The directives we have is to conduct the privatisation process transparently, complying with due process and international best practice. We are expected to improve on the high standards set in the

power sector transaction, which has received accolades all over the world as being very transparent,” BPE Director General, Mr. Benjamin Dikki, said in a statement issued in Abuja.

Dikki stated that privatisation transactions for the refineries would draw from the successes in the successful privatisation of successor generation and distribution

companies created from the unbundling of the defunct Power Holding Company of Nigeria, PHCN, under the government's reform programme for the power sector.

He assured that the processes to be adopted in the refineries privatisation would be subjected to utmost transparency but with an expectation that it will be far above the experience from PHCN privatisation.

Oil

2014 January, SweetcrudeReports

Skills Development: PTDF partners Botswana University

09

NIGERIA CONTENT INITIATIVE Dr. Ibilola Amao

Nigeria’s Gas Revolution -The long Overdue Revolution

T

University of Botswana

P

lans are on by the P e t r o l e u m T e c h n o l o g y Development Fund, PTDF, to partner with Botswana University of Science and Technology, BUST, in the development of skills for the Nigerian oil and gas industry.

Disclosing this while receiving the management of the university led by its Vice Chancellor, Professor Hilary Inyang, in Abuja, Executive Secretary of the Fund, Dr. Oluwole Oluleye, said: "The key thing is to start the process and then we can continually build on that,” he stated. “This is quite innovative and I am quite impressed. I see some areas of collaboration and I believe with an African sister institution coming to us, "I think we would see how we can give you some preference and see how we will be able to send some students to you and continue to do what is necessary to move the process forward.”

According to Oluleye, his agency has been involved in many programmes and activities aimed at developing the manpower needs of the Nigerian oil and gas industry and will do anything at its disposal to collaborate with the Botswanabased University especially in areas of vocational and technical skills development as well as the Fund’s University lecturers Skills Enhancement Programme, ULSEP, and other forms of entrepreneurship skills development initiatives.

Noting that his administration was ready to train and enhance the capacities of people to participate in the oil and gas industry and to move a step further to get them employed and positioned to contribute their quota to the overall national economy, the PTDF boss said the Fund has created effective linkage between its recently graduated 100 youth who underwent vocational training in Cotonou, Benin Republic with some Banks in order to support them develop their acquired

skills so that they can be self sufficient enough to contribute to the national economy.

In his contribution, Professor Inyang stated that he led his

delegation to visit the PTDF so as to acquaint the executive secretary with the activities of his institution.

Kano Govt warns filling stations against hoarding

T

he Kano State Government has warned owners of filling stations hoarding petrol not to do so or face the wrath of the law.

The State Commissioner for Commerce, Industry, Cooperatives and Tourism, Dr Damburam Nuhu, gave the warning in a statement signed by the ministry’s Public Relations Officer, Malam Aliyu Yusuf.

It said that the government had observed that some stations had decided not to sell fuel since Sunday, thereby creating panic buying among fuel consumers in the state.

It said that most of the stations had enough petrol to sell to the motorists and other consumers, yet they deliberately created the temporary scarcity.

The statement urged the people not to panic, adding that a monitoring team would commence inspection of the filling stations, and any station found hoarding the product would face the wrath of the law.

It directed all filling stations to continue with their normal operations.

The statement said the NNPC depot at Hotoro had confirmed that all the filling stations in the state had sufficient petrol to sell, adding that there was no reason to hoard the product.

“The depot further acknowledged that even during the weekend, no fewer than 53 petrol tankers were off-loaded across filling stations in the state,” the statement said.

o tackle the epileptic power supply that plagues individuals in Nigeria, at best diesel or kerosene generators are used back-to-back with some costs subsidised by functional inverters.

The average Nigerian is not so fortunate and does not have the luxury of choice but has to do with either a hybrid inverter or a kerosene generator. Most Nigerians fall into the category of those who are stranded in badly ventilated environments and can neither afford a generator nor an inverter. They are reduced to suffering the noise pollution as well as the exposure to the cancerous toxins of fumes from their neighbor’s generators.

Nigeria leadership must prescribe gas utilisation and zero flare incentives such as those that resulted in viable gas utilisation projects.

The growth and development of natural gas utilisation in Nigeria has been constrained by a lack of political will to put in place the appropriate policy, incentives and fiscal regime that would stimulate domestic gas utilisation. It is most appropriate to question the government of President Goodluck Jonathan, his Minister of Petroleum Resources, Minister of Power, Minister of Works, Minister of Interior and Minister of Mines and Steel Development on their inability to deliver developmental assets to Nigerians as promised during the launch of the Gas Revolution in March 2011.

Looking at the colourful and well packaged write up by newspapers as well as the publicity that went with the gas revolution launch, I wonder where the plan got mixed up if at all there was one. President Goodluck Jonathan announced at the launch, the rebirth of Nigeria’s industrialisation in Abuja to great applause by industry watchers, emphasizing that it is vital for the diversification of the economy for national development.

He assured the investors, notably Xenel of Saudi Arabia, Nargajuna of India and Chevron in Nigeria of Government’s readiness to provide the necessary support. President Jonathan is quoted as saying: “this aspiration to re-industrialise Nigeria is aggressive and can only be achieved through a revolution”.

Not only have these quotes become an embarrassment to the President and his Minister of Petroleum Resources but it is now evidence of the levity with which statements are made by the leadership in Nigeria. To have invited Nargajuna, Xenel and Chevron representatives to a gathering when there was no actual plan in place to ensure that three years afterwards some of the nine (two world-scale petrochemical and fertiliser companies, as well as five fertilizer blending plants, a methanol plant, a Liquefied Petroleum Gas (LPG) distribution plant) line items of capital investment mentioned exists is such a shame.

Key and notable figures at the event include the Governor of Delta State, former GMD, NNPC, Engr. Austen Oniwon, the Vice President of Nigeria, members of the Federal Executive Council etc.

It is no news that all is not well with the Nigerian Oil and Gas industry. If the President of the Federal Republic of Nigeria and the Commander in Chief of the Armed forces of Nigeria promised that the Petroleum Industry Bill (PIB) would enjoy a quick passage, in March 2011, not only to Nigerians but to dignitaries from Saudi Arabia and India as well as representatives of a US based International Oil Company, I wonder what credibility we have as a nation if almost three years later the bill has not been passed. Also, the Minister of Petroleum resources is quoted as saying that $1billion was to be spent in 5 years on seismic data gathering, aeromagnetic surveys, exploration and appraisal drilling, gas is not fully monetized and there is no incentive for the exploration and production of non-associated gas. Nigeria desperately needs credible and committed leaders, who not only understand but mean what they say and say what they mean. To accomplish this they need dedicated foot soldiers and not sycophants so that they follow through on their utterances. If our nation must come out of its current state of accelerated regression we not only need a gas revolution but a mind revolution. Can our President and Minister improve the lot of us Nigerians by implementing the various uncompleted plans they have laid out since 2011 and the long awaited gas revolution before it is too late? *Dr. Ibilola Amao is the Principal Consultant with Lonadek Oil and Gas Consultants Limited, a firm of technical consultants with their core competence in the area of Local Content and Vendor Development. For more information or to reach Dr. Amao you can email her atlolaamao@lonadek.com or visit www.lonadek.com.

Focus

2014 January, SweetcrudeReports

10

Compliance with rules, regulations is our core value —Siemens Nigeria Boss

S

iemens prides itself in vigorously leveraging the advantages it provides.

The business activities of the company's energy, healthcare, industry and infrastructure sectors have helped it capture leading markets and high technology positions worldwide. Mr. Michael Lakota, Managing Director/Chief Executive Officer, Siemens Nigeria, in this interview with CHUKS ISIWU, speaks on the company's operations in Nigeria, its expansion plan and how Siemens is helping Nigeria build local capacity.

Could you tell us about your operations in Nigeria?

Our operations in Nigeria have a very wide scope. We are active in the power sector and in the industry sector, mainly focusing on the cement industry, building materials, food and beverages and consumer goods. We also operate in the healthcare sector and in the infrastructure and city sector. These constitute our global focus (four sectors). In Nigeria, our primary focus is on the energy sector and our activities range from supporting the oil and gas operations to power generation, power transmission and also the distribution of power.

in executing that project?

In finishing the project, our number one challenge was the location of the area in the middle of the country. This made it difficult in terms of logistics of bringing our heavy equipment to site. That was definitely a challenge. Apart from that, the other is the regular project management challenges we would ordinarily have as a company doing a turnkey project. One has to manage your project actions very thoroughly and very accurately, then one is able to carry it through. This is what we seek to prove, to deliver a power plant in time and in perfect order. It is very rare in Nigeria (to my understanding) that a huge project worth around 300 million Euros is delivered on time and in order.

In the area of power, what specifically have you done in Nigeria?

The latest indigenous project and I will also say the biggest success story so far for Siemens Nigeria, is the Geregu II power plant, which we handed over to the president (President Goodluck Jonathan) in an official commissioning ceremony on the 3rd of October 2013. This is the second part of the Geregu I plant, which we also built. The power plant generating 434 megawatts has now made Geregu, a small town close to Ajaokuta (in Kogi State) the centre of excellence when it comes to power generation. This is because this is one of the biggest success stories in Nigeria especially when you take into account the situation in the power sector generally. This claim is not only from my personal perspective but is also found in the company's history.

You mentioned earlier about your involvement in oil and gas. What exactly does Siemens do in that sector?

We support the oil companies in the area of power generation because they need a lot of power for their operations. We supply gas turbines to the oil companies for power generation and we also support them in compression solution, for pipeline compressors. For their operations, they need a lot of compressors and compressor training. On gas compression, for instance, we have more than 100 units installed around the country.

What were the challenges

What is your level of

involvement in healthcare?

To be honest, the healthcare sector is still very young or at a very early developmental stage.

We at Siemens are providing top technology healthcare equipment for hospitals (e.g. computers). Nigeria still needs to develop the sector much better because currently a lot of

have you done in Nigeria?

Apart from the recently commissioned Geregu II, we built Geregu I power plant. We also built the Afam power plant.

We are the preferred bidders for some IPP projects. So, there are projects in the pipeline right now. Geregu and Afam are the two major power plants we have

One has to manage your project actions very thoroughly and very accurately, then one is able to carry it through people still fly out of the country to get professional medical treatment, and I think this is something the government should take a look into. It should treat the people in-country and provide a sustainable professional healthcare system in-country.

Apart from the Geregu plant, what other projects

built. However, we have done smaller power plant projects, for clients like Dangote, cement plants, for iron and steel plants, as well as for the oil and gas industry. These are captive power plants which are used to supply power for industrial purposes, e.g. power supply to cement plants or bottling plants or even to iron and steel plants.

What are the upcoming IPP projects that you are involved in, as you mentioned earlier?

One is located at Benin. There are many IPPs coming up, in different sizes and scales. There is currently a lot of discussions and negotiations about contracts for the power plants. It is still too early to talk about them at this stage.

Going through your company information online, I observed that within the period between 2001 and 2012 your customer sales in Nigeria was as much 121 million Euros. What's your assessment of this performance and are you hoping to surpass this?

Nigeria is a gross market, that's for sure. I think everybody knows this although we know that doing business in Nigeria is not easy and not always straightf orwa rd . There a re so m e boundaries and hurdles which one would need to overcome, not only from supplying companies but also from customers'

CONTINUES ON PAGE 11

Focus

2014 January, SweetcrudeReports

CONTINUED FROM PAGE 10 perspective, to speed up processes. There are however good opportunities. On the other hand, this is something which we have said very clearly: compliance (with rules and regulations), for us, is the most important thing. We will never do anything that is not transparent or which does not comply with our own very strict rules and regulations, and also not compliant with the Nigerian rules and laws, either the trade act or anticorruption acts. That is something very important for Nigeria which we will never compromise for any revenue target or for any target you might have in mind.

That's our principle and a core value.

to develop our business and we want to support our customers, especially focusing on the power industry, but then we also work with industrial conglomerates like Dangote, Honeywell, Flour Mills, etc. There is also much internal demand in building materials. Going to food and basic products, such as noodles, f l o u r s a n d s u g a r, t h e s e industries are coming up in Nigeria and we as a technology company can also deliver a lot of value to these customers. Of course we are covering the whole value chain starting from power generation, including the medium voltage which is required in the industrial set up, down to factory automation.

Mr. Lakota

Are you thinking of going into renewables in Nigeria?

That’s an interesting field and we recently discussed that with the Minister of Power (Prof. Chinedu Nebo). We invited the minister to Berlin some weeks ago. He was in our gas turbine factory with a delegation to talk about the future of the energy sector in Nigeria, and definitely, the energy mix is important. We calculated some scenarios and did analyses of how the market could develop and which energy mix might be the best option from the investor's perspective.

We finally came up with the position that renewables is an option but it will never solve the basic problem of the Nigerian power shortage. With the renewables, you can operate in the north, the middle belt and the coastal areas. Altogether, the renewables will not solve the problem. From our calculation and from our scenario approach looking into the future, gas-fired power plants are the most economical and the ones which could be built up a lot quicker and which will eventually bring in massive generation capacity for Nigeria.

As a company, are you going to go into it (renewables) in Nigeria?

Definitely yes, as a company we are into renewables. We are involved in wind. Once a customer asks us to support a renewable project, we will do it.

But again we aren’t a utility, so, we are not building a solar plant or a wind plant for ourselves. We will build it once a customer asks for it. That's our job here in Nigeria - to discuss with our customers their requirements and then try to meet such requirements. If you are the customer and you want to generate power, we can give you all options in our portfolio and then you as a customer need to make the decision which one you want to go for - hydro, solar, wind or gas or whatever you want. It always depends on your parameters - investment, return-on-investment, availability of fuel or availability

Compliance with rules, regulations our core value —Siemens Nigeria Boss of natural resources. This is a call that the customer would have to make. We try to be as neutral as possible, to show all options. This is extremely important and this is our approach. We are not involved in telling you something for the short term. We want to tell you the truth about your life package because our products are designed for 30, 40 years and not just for two or three years. This is a very important approach that we are trying to bring into the market, looking at the total cost of ownership and looking at the total life package of a product or a project, especially talking about power. We are talking about things that you can use if they are good for 40 - 50 years.

You could use a top technology product for years. You could use a turbine for instance, for 40 years once you give it proper maintenance.

You talked earlier about the Minister's visit to Germany. During that visit, an MOU was signed between Nigeria and Germany to generate about 10,000 megawatts of power in Nigeria. What does this really entail?

It was an addendum to the previous MOU signed under the predecessor of Prof Nebo. Now, we amended it and reemphasised our commitment to

1 1

It was an addendum to the previous MOU signed under the predecessor of Prof Nebo. Now, we amended it and reemphasised our commitment to Nigeria. We also amended it to include a very important point the transmission, because transmission is a very critical aspect in the Nigerian energy sector Nigeria. We also amended it to include a very important point the transmission, because transmission is a very critical aspect in the Nigerian energy sector.

Under this MOU, what will Siemens do towards helping Nigeria achieve the 10,000 megawatts target? Are you going to provide only support services or are you going to be involved directly in the building of projects that will generate the volume of power?

It is both. We are providing support for generation. We can build power plants. We have demonstrated that in Geregu and I am proud to say that we are the only company in Nigeria that has built a power plant on time and with state-of-the-art technology. So we have a perfect story. We can build, but we need

customers. Again, we are not a utility. We are a technology company. Once either the government or a private investor places an order, we can immediately build the power plant and we will immediately contribute to the 10,000 megawatts.

On the generation side and also on the transmission side, we do a lot of development work with our customers. We try to find the right option for the customer and the right technology. We also help our customers in a very young market to find the right technology and the right partner to work with.

What is you general expansion plan in Nigeria?

I mentioned before that Nigeria is a gross market and a growth engine for Africa. We want to be part of this, we want

Are you thinking of building a plant here in Nigeria for some of the things you currently bring into the country just like the US company, GE, which has announced plans to establish a manufacturing plant here?

I don't want to comment on our competitor's announcement. I want to focus on reality and the only reality we see on ground here is what has been done so far. For instance, we have already signed an agreement with Mikano, a partnership to build substations locally in Nigeria. This is a way we are contributing to growth in Nigeria - partnering. We want to increase capacity not on our side. We want to enable Nigerian companies and this is what we are going into - partnerships in various fields with Nigerian companies. However, we are in t h e s e c o n d r o w. We a r e delivering components or knowhow training. We work together and our local partners are as in the substation example, making products locally in Nigeria with the Siemens brand name. That's our priority, not to invest in bricks and walls. That's not what we want to do. We want to invest in people and knowledge.

And that's why we are going the way of partnering with companies.

Siemens has been involved with the defunct National Electric Power Authority and Power Holding Company of Nigeria in its task of generating and supplying power to Nigerians. What do you really think is responsible for Nigeria's problem with power supply from your own perspective?

One thing is the challenge of gas supply. We have various customers who want to build power plants, but they are struggling because they don't have sufficient gas.

Gas

2014 January, SweetcrudeReports

12

Rest kerosene, adopt cooking gas, PPMC urges Nigerians

M

anaging D i r e c t o r, Pipelines a n d Products Marketing Company, PPMC, Prince Haruna Momoh, has urged Nigerians to rest the use of kerosene and adopt liquefied petroleum gas, LPG, for cooking to save costs.

Speaking in Abuja on plans by his company to deepen the use of the LPG also known as cooking gas, Momoh said other countries were diversifying from kerosene to gas as house hold fuel as he announced plans by the Nigerian National Petroleum Corporation, NNPC, to retail LPG in its fuelling stations across the country.

T he PPMC boss, who stressed that gas is the future of the world, said: “Kerosene is expensive and is imported.

“I urge Nigerians to rest the use of kerosene and save costs. A lot has been done by government to ensure that it comes to stay. We produced 250,000 metric tonnes of LPG this year (last year).

“Our market plan is to begin more retailing of LPG and lubricants in our 450 mega and affiliate stations by mid2014 so as to ensure quality and pricing.

He added that “LPG is cleaner and safer," as he assured that the PPMC, a subsidiary of the NNPC, would continue to ensure petroleum products were available at all times.

Giving details of the plan to deepen the LPG use in the country, Momoh stated that one of the measures is to provide LPG skids in its 21 depots, the aim being to bring

Cooking gas the product nearer to consumers, especially those in the rural communities.

This, he said, would in turn help reduce the traditional use of wood and charcoal for cooking, in the process, helping to reduce

his company would in the future acquire LPG vessels and would in partnership with non-governmental organisations, NGOs, create increased awareness on substitute fuel for the nation.

He further stated: “PPMC

PPMC did not only guarantee the availability of coastal storage at Apapa, PPMC embarked on the rehabilitation of all LPG utilisation plants strategically located across the six geo-political zones of the country deforestation in the country and the general global environment.

According to the PPMC boss, other measures included the creation of viable access and restoration of the Apapa LPG facility from 4,000 metric tonnes to 7,000 metric tonnes.

Momoh also revealed that

is saddled with the responsibility of petroleum products supply and distribution, as well as the supply and distribution of LPG in the Nigeria market.

“In 2007 when NLNG announced the intervention scheme through the appointment of off takers by the federal government,

PPMC decided to key into this vision to ensure the achievement of the intervention scheme.

"PPMC did not only guarantee the availability of coastal storage at Apapa, PPMC embarked on the rehabilitation of all LPG utilisation plants strategically located across in the six geo-political zones of the country.

“These utilisation plants were constructed about 20 years ago but they were left unused.

PPMC then after the launch of the intervention scheme by NLNG embarked on a rehabilitation of the utilisation of these plants. These plants are located in Lagos, Ibadan, Ilorin, Kano, Guzo, Gombe, Enugu, Calabar and Makurdi.

“The aim of building these utilisation plants years back was to ensure that LP gas gets closer to consumers that disforestation is reduced and also that gas flaring is reduced to the barest minimum".

2014 January, SweetcrudeReports

Gas

NLNG Plantt

NLNG a successful company, says Okonjo -Iweala

F

inance Minister, Dr. Ngozi OkonjoI w e a l a h a s commended the Nigeria LNG Limited as a successful and commercially viable organiation.

The co-ordinating minister for the economy, who spoke during a recent visit to the NLNG plant on Bonny Island, Rivers State, said: “I came, after looking at your books, and saw that you have been commercially viable and successful. The Nigeria LNG is an asset to the country".

The company is owned jointly by the Nigerian National Petroleum Corporation, NNPC, representing the Nigerian government; alongside three other companies - Shell Gas BV with 25.6 per cent stake, Total LNG Nigeria Limited (15 per cent) and Eni International (10.4 per cent). The NNPC holds the largest interest of 49 per cent, The $2.6 billion NLNG plant which commenced operation in

But the minister was hopeful that the planned Train 7 NLNG expansion project would position Nigeria better in the global LNG market and ensure it gained more market share rather than losing 2009 has so far earned for the shareholders a whopping $25 billion. Besides it owns 24 ships, which is involved in LNG trade across the world while another six ships are currently under construction at the Samsung and Hyundai ship building yards in South Korea.

Okonjo-Iweala, during the visit, also heard that, to empower Nigerians in line with the Local Content law covering the oil and gas industry, the company recently launched a $1 billion finance scheme for its local contractors and vendors.

This is aimed at aiding its

registered local contractors and vendors access scarce funds from banks in form of loans at conducive rates. Five local banks are participating in the scheme and any contractor or vendor registered with the NLNG could approach any of the banks for a facility that would enable them execute jobs from the gas company.

To access the loan, however, such vendor or contractor

13

would be expected to present to the bank a work order, purchase order or contract document from the NLNG. The participating banks are First Bank of Nigeria, Access Bank, United Bank for Africa, UBA, Standard Chartered Bank and Zenith Bank.

According to NLNG's Managing Director, Mr Babs Omotowa, the credit would enable the NLNG registered contractors and vendors speed up delivery of goods and services to the nation’s oil and gas industry.

Despite what the minister saw as an impressive performance, there are fears for the Nigeria LNG over the predicted global LNG industry storm, which analysts say, could see the Nigerian company losing a considerable chunk of its market share.

But the minister was hopeful that the planned Train 7 NLNG expansion project would position Nigeria better in the global LNG market and ensure it gained more market share rather than losing.

The Train 7 project is expected to lift NLNG’s total gas production capacity from the current 23 to 30 metric tonnes per annum of LNG on completion. Also, it is expected to fetch the government annual revenue of $3 billion.

But, the project had been on the drawing board for long, suffering various shifts in its planned construction take off.

According to the NLNG boss, the continued delay of the Train7 project is believed to be holding back fresh Foreign Direct Investment worth $12 billion that should have been flowing into the country in addition to about 13,000 jobs expected to be created by the project.

“We are expecting Foreign Direct Investment of $12bn from our proposed Train7 plant, which we hope will be completed within the next four years. The project is expected to create 13,000 new jobs and generate $3 billion revenue annually for the government,” he said.

Desperate businessmen smuggling substandard gas cylinders into Nigeria - NLPGA

T

he Nigeria Liquefied Petroleum Gas Association, NLPGA, says desperate businessmen were smuggling substandard gas cylinders into Nigeria without regard to standard requirements.

Besides safety considerations, according to the association, the influx of the substandard cylinders was a discouragement to genuine investors wishing to go into the gas cylinder business.

Making this disclosure, president of the NLPGA, Dayo Adeshina, said: “In the recent years, tens of thousands of LPG cylinders have been imported into the country and some of the

cylinders were certified by the Standard Organisation of Nigeria, SON. “Some cylinders were also smuggled into the country by desperate businessmen with little or no recourse to standard requirements.

“Unfortunately, unsuspecting buyers often prefer the substandard cylinders in order to save money”.

Adesina, who stressed the need to arrest the ugly trend, said his group was ready to co-operate with the Standard Organisation of Nigeria, SON, the Nigerian Association of Liquefied Petroleum Gas Marketers and other relevant stakeholders in the business in that regard.

2014 January, SweetcrudeReports

Gas

14

NOSDRA ready to address gas flaring soon – DG

Gas flaring

A

new amendment is underway to empower the National Oil Spill Detection a n d R e s p o n s e A g e n c y, NOSDRA through its act in order to address the problem of gas flaring in the country.

The Director-General of NOSDRA, Mr Peter Idabor, who disclosed this in Abuja, said the issue of gas flaring had been the subject of discussions for a very long time now.

He said that oil companies were looking at the cost implication of tackling the problem especially since gas could be harnessed to generate electricity.

“Gas gathering can power the turbines that will produce the much needed electricity for this country. I believe in a short period of time, the issue of gas flaring will be minimised; you cannot talk about zero flare,” he said.

In the interim, he advised oil companies to use scrubbers to filter raw gas coming from their plants to reduce gas flaring in the country.

According to him, scrubbers are a diverse group of air pollution control devices that can be used to remove some particulates and or gases

from industrial exhaust streams.

The director-general said that the scrubber would help to filter raw gas causing environmental pollution.

He said that technology would also help to hold back some heavier molecules that could cause more damage to the environment.

“My own recommendation has always been that they should attach what is called scrubber, enough scrubbers not to allow the crude gas coming out from the ground to just burn with so much smoke.

“There are some chemical products that are associated with those gases; so if they put scrubber at the mouth, they will filter it and (the gas will) burn in a better way.

“What we are saying is that oxide of carbon, oxide of sulphur, oxide of nitrogen are being spilled into the environment and this could cause acid rain; so it is a problem.“

T

he director-general said NOSDRA had been working hard to address the problem of oil spills in the Niger Delta.

He explained that all stakeholders, including NOSDRA, the community and the oil companies,

My own recommendation has always been that they should attach what is called scrubber, enough scrubbers not to allow the crude gas coming out from the ground to just burn with so much smoke

among others, were involved in determining the cause of a spill and the information signed by all the parties.

“After that, we ask the oil companies to contain the spills with immediate effect as soon as they receive the information.

“The oil is contained and the environment is cleaned and if necessary, remediated to its original form before the spill,” he said NOSDRA was established

by Act No. 15 of 2006 by the Federal Government, to address environmental degradation and devastation of the coastal ecosystem, especially in the oilproducing areas of the NigerDelta region.

NOSDRA is statutorily empowered to coordinate oil spill management and ensure the implementation

of the National Oil Spill Contingency Plan, NOSCP, for Nigeria, in accordance with the International Convention on Oil Pollution Preparedness, Response and Co-operation, OPRC, 1990, which Nigeria has ratified.

The NOSCP is a blueprint for checking oil spills through containment, recovery and remediation/restoration.

It was drafted in 1981 and first reviewed in 1997 and further reviewed in 2000 and 2006, respectively.

Labour shortage threatens $50bn LNG plans

E

nergy companies trying to raise almost $50 billion for Canada’s first network of natural gas export terminals will face an even more basic challenge: finding the workers to build them.

Housing complexes boasting an indoor golf driving range, a two-storey gymnasium and a private movie theater are among perks companies are mulling to lure tradesmen to Canada’s remote, snow-swept West Coast and mitigate wage inflation that could blow up project budgets.

Labour shortages in the country already have pushed wages for some oil and gas workers as much as 60 percent higher than their counterparts in the United States, according to U.S. and Canadian labour data.

“The lack of skilled workers is a major component for the reason why you’re often behind schedule and over budget,” said Geoff Hill, partner and oil and gas leader at financial advisers Deloitte Canada in Calgary. A dearth of labor for oil sands and mining will be “exacerbated” by a new wave of construction to enable gas exports, he said.

Chevron Corporation will need as many as 5,500 workers to build a pipeline across Canada’s western mountains and a plant on the country’s frosty Pacific Coast for shipping gas to Asia, according to company estimates.

2014 January, SweetcrudeReports

Gas

15

Oando Marketing Plc Office building, Apapa, Lagos.

German firm lifts Nigeria's LPG subsector with $5m

G

erman governmentowned development bank, KFW, would be making 5 million Euros available to select microfinance banks, MFB, in the country to boost local utilisation of the Liquefied Petroleum Gas, more popularly known as cooking gas.

The initiative is coming through Oando Marketing Plc, a subsidiary of the integrated energy group, Oando.

According to Chief Executive Officer, Oando Marketing, Mr. Abayomi Awobokun, the funds would be loaned to micro, small and medium-sized enterprises and cooking gas end users for investment in the LPG. The initiative was sealed in an agreement between the German bank and Oando Marketing in Frankfurt, Germany. KFW’s Director of the Department for Africa Regional Programmes, Dr. Thomas Duve, and Awobokun signed the agreement ob behalf of their companies..

Oando Marketing Department recently signed a Memorandum of Understanding with the National Association of Microfinance Banks to make the LPG, which Awobokun described as "cleaner and safer cooking fuel" easily available to more Nigerians.

MFBs involved in the scheme, which aims at promoting Oando's three-in-one 3kg O-Gas cylinders, include Foresight MFB, Lake MFB, Channel MFB,

Esusu MFB, Capstone MFB and Infinity MFB. Others are Sunrise MFB, Acute MFB, Strong Alliance MFB and Global Initiative MFB. Awobokun stated that under this arrangement, intending end users could approach a wide range of microfinance banks with only N200 as an initial deposit and acquire a complete set of the portable 3kg O-Gas. But, he revealed that such intending end-users would have to deposit N200 daily with the selected microfinance banks for 30 days to complete the payment for the 3kg cylinder.

On the latest deal with the German bank, the Oando

Awobokun listed some of the advantages of utilising the gas to include the provision of a cleaner and safer fuel option for lowerincome households; reduction of indoor air pollution that causes significant health problems as well as decline in carbon emissions resulting from dirty fuels

Marketing boss said it was a good development for especially the low-income earners in the country, who, he said, Oando was determined make more comfortable through unhindered access to affordable cooking gas.

Awobokun listed some of the advantages of utilising the gas to include the provision of a cleaner and safer fuel option for l o w e r- i n c o m e h o u s e h o l d s ; reduction of indoor air pollution that causes significant health problems as well as decline in carbon emissions resulting from dirty fuels and a reduction in deforestation and the green house effect.

Fracking ‘may help conserve water’ H

ydraulic fracturing may actually help conserve water in the long run as the gas the technology frees up can supplant the water-intensive needs of electricity generated by coal, a new study has found.

Researchers at the University of Texas at Austin studied water-use data from all 423 power plants in the state of Texas, concluding that “the transition from coal to natural gas for power generation is saving water and making the state less vulnerable to drought”. Texas produces more power than any other state.

“Even though exploration for natural gas through hydraulic fracturing requires significant water consumption in Texas, the new consumption is easily offset by the overall water efficiencies of shifting electricity generation from coal to natural gas,” researchers said in a statement.

Environmentalists have raised concerns about the demands fracking puts on freshwater resources in places like west Texas and elsewhere suffering through devastating droughts.

But the recent study, which was published this week in the journal Environmental Research Letters, estimated that the water saved by shifting a power plant from coal to gas is 25 to 50 times as great as the amount of water used in fracking.

Gas can also supplement wind-power plants at times of peak use, which could promote even lower levels of water consumption from power generation.

According to the study, in 2011 alone Texas would have consumed an additional 32 billion gallons of water if all its gasfired power plants were instead coal-fired plants, “even after factoring in the additional consumption of water for hydraulic fracturing to extract the natural gas”.

“The bottom line is that hydraulic fracturing, by boosting natural gas production and moving the state from waterintensive coal technologies, makes our electric power system more drought resilient,” said Bridget Scanlon, senior research scientist at the university’s Bureau of Economic Geology, who led the study.

2014 January, SweetcrudeReports

Gas

16

'NLNG Train 7 project, others to create thousands of jobs’ SAM IKEOTUONYE

M

anaging Director of the Nigeria L N G Limited, Mr

Babs Omotowo, says the Nigerian Liquefied Natural Gas, NLNG, Train 7 project together with the Brass LNG project and the Federal Government gas master plan would create thousands of

jobs for the nation's unemployed.

Omotowo gave the assurance in Port Harcourt as he re-assured of his company's commitment to the success of the Nigerian

Content policy.

He noted that besides creating jobs on completion, the NLNG Train 7 project would also create economic opportunities for indigenous companies.

NLNG-Plant-Bonny-123

At the recent signing of a M e m o r a n d u m o f Understanding, MoU, with representatives of five local banks to kick-off his company's $1 billion financing scheme for contractors and vendors, Omotowo said the scheme was in accordance with the Nigerian Oil and Gas Industry Content Development Act of 2010, which encourages full participation of local companies in the oil and gas business alongside the foreign firms.

Five local banks are participating in the scheme and any contractor or vendor registered with the NLNG could approach any of the banks for a facility that would enable them execute jobs from the gas company.

To access the loan, however, such vendor or contractor would be expected to present to the bank a work order, purchase order or contract document from the NLNG. The participating banks are First Bank of Nigeria, Access Bank, United Bank for Africa, UBA, Standard Chartered Bank and Zenith Bank.

According to Omotowo, the credit would enable the NLNG registered contractors and vendors speed up delivery of goods and services to the nation’s oil and gas industry.

Gas exports to bridge Tanzania’s current account deficit

T

anzania will reduce its current account deficit in the next few years when it begins exporting high value commodities like the liquefied natural gas, LNG. Currently, the government is looking at erecting a facility to export LNG to be located in Lindi Region by 2020, that will be similar to those developed by the biggest gas exporter Qatar in the world. Similarly, it is pushing to start natural gas exports to the East African countries by 2015.

The Tanzanian Ambassador in Belgium and the European Union, EU, Dr Diodorus Kamala said: “To export goods with high value in order to lessen current account deficit, heavy investments on value

addition to ensure such commodities qualify the level of international standards is of paramount importance.

“It is from this reason that the government is struggling to attract serious investors to invest in the exploration of natural gas and other mining and agriculture activities for the country to export high value goods.”

Tanzania is estimated to have more than 40 trillion cubic feet of gas, which it said can rise for over five-fold over the next five years, putting it on par with some Middle East producers. It already uses it locally for power production for the national grid as well as in the industries like cement, textile and glass

manufacturing, breweries and steel mills.

Tanzania is still heavily dependent on traditional exports namely of cashew nuts, coffee, cotton, sisal, tea and tobacco. Over 70 per cent of the population engages in agriculture activities for income generation.

Thus, attracting investors into value addition of agro products would in the same way help to the great extent boosting exports of high value goods to fetch premium prices in the international markets and in the end lessening current account deficit.

LNG Tanzania

2014 January, SweetcrudeReports

Gas

US shale oil output ‘to peak in 2021

would fall to below 40% in the near term but then recover after 2016. Last year it had expected OPEC’s share to remain at 40-45% in the coming years.

The EIA maintained its view from last year that output will peak by 2020 and begin to decline. The sharp decline rates of most shale oil wells has fueled some skepticism of the long-term trend from a handful of geologists.

The EIA said the United States would be pumping 9 million bpd by 2025, a million barrels more than today, and 7.5 million bpd in 2040, above last year’s 6.1 million bpd forecast.

H

Shale oil

U

S crude oil production, rejuvenated by the advent of “fracking” shale formations, will approach historic highs by 2019, the Energy Information Administration, EIA, has said, raising its forecast to levels that would have been unforeseen just a few years ago.

The US oil and gas industry has been a bright spot in recent years as the economy struggles to recover from a financial crisis and growth stagnation.

The energy renaissance has prompted some large US oil companies to sell foreign assets and come home to focus on shale, leading to a upsurge of infrastructure projects. Cheap gas, meanwhile, has reinvigorated the refining and energy-heavy industrial sectors by lowering costs.

The EIA said production in t h e w o r l d ’s l a r g e s t o i l consumer will rise by 800,000 barrels per day every year until 2016, when it will total 9.5 million bpd.

By 2019 it will peak at 9.61 million bpd, nearly matching a 1970 record of 9.64 million bpd.

In 2019, domestic production of crude oil will account for 63% of total supplies, a significant increase from 2011 when it barely covered 38% of the country’s needs.

The government agency’s two-million-barrel-per-day upgrade from last year’s report shows how production from tightly packed shale rock has consistently confounded analysts, as higher prices and rapidly evolving technology fuel growth.

The EIA increased its forecast for shale oil production and pushed back the year of its peak. It now sees production peaking in 2021, from 2020, at 4.8 million bpd, not 2.8 million bpd.

“One thing I am sure of: The technology and prices really, really matter when you look at what the likely production numbers for oil and gas are going to be,” EIA Administrator Adam Sieminski told analysts. “It’s not just trying to estimate what the resource level is in the ground.”

Just a few years ago, US policymakers were considering the risks of an

The sharp decline rates of most shale oil wells has fueled some skepticism of the long-term trend from a handful of geologists.

ever-rising dependence on imported fuel. The EIA itself barely mentioned shale oil in its 2010 outlook, focusing rather on offshore production growth.

N

ow policymakers are struggling to get to grips with a complete reversal of that equation. The government has begun approving more natural gas exports and may consider lifting a ban on crude oil exports.

Sieminski said the government may want to consider oil swaps with Mexico, if not a total elimination of the nearblanket ban on exports which was imposed after the 1970s

17

Arab oil embargo. A mere 60,000-130,000 bpd leave the country, all for Canada under special licenses.

“They might want to look at the possibility of whether it would make some sense to allow the light sweet crude to go to refineries in Mexico that need that oil and have more sour crude coming from Mexico,” he said.

Members of OPEC, including Saudi Arabia, are being forced to confront a trend they initially greeted with skepticism. The global oil cartel said in November it may lose 8% percent of its market share to shale in the next five years.

The EIA on Monday said OPEC’s world market share

igher US production will also help tamp down global benchmark Brent crude oil prices, which are now expected to fall to $92 a barrel in 2012 prices in 2017, before rising to $141 in 2040. Last year the EIA saw a fall of $96 in 2015.

US oil and gas output reversed years of decline after companies learned how to drill long horizontal wells and hydraulically fracture shale rock to entice out oil and gas.

The EIA raised its forecast on natural gas production to 31.9 trillion cubic feet (tcf) by 2025 from the 28.7 tcf it had forecast last year, and to 37.6 tcf by 2040 against the 33.2 tcf touted earlier.

The 2040 total annual gas production number equates to just over 100 billion cubic feet a day from around 70 bcf/d now.

Natural gas output will increase steadily, growing 56% between 2012 and 2040.

Natural gas exports will continue to rise. The country will become a net natural gas exporter two years sooner than the EIA had previously judged, in 2018, and a net exporter of liquefied natural gas (LNG) by 2016.

Imports of liquid fuels will fall to 25% of total U.S. consumption by 2016, far lower than the EIA’s previous forecast of 34% by 2019, from 40% today.

As oil output starts to fall, the share will increase to 32% by 2040, still lower than the 37% it expected a year ago.

Consumption of liquid fuels will rise to 19.3 million bpd in 2025, but then slip to 18.7 million bpd from 18.5 million bpd in 2012. Natural gas consumption will rise to 28.4 tcf by 2025 and to 31.6 tcf in 2040 from 25.6 tcf last year.

2014 January, SweetcrudeReports

18

Power

2014 January, SweetcrudeReports

19

Calabar Simple-cycle 561 MW

NIPPs bids: Financial evaluation to be unveiled this month SAM IKEOTUONYE

I

nvestors bidding for any of the 10 National Integrated Power Projects, NIPPs, put up by the Federal Government for privatisation must have a net worth of between $100 and $250 million.

Managing Director of the Niger Delta Power Holding Company, NDPHC, Mr James Olotu, disclosed this in Lagos, announcing also that an Evaluation Committee was already considering the proposals sent in by the bidding companies and was expected to round up its assignment soon to kick-start the approval process for the bids.

The NDPHC has received about 66 proposals for the acquisition of 80 percent of the 10 power plants, with installed capacity of 4,700mw The plants are still largely under construction.

Olotu, who spoke on what follows after the assignment of the Evaluation Committee, said: "It is after the evaluation, that the report will be submitted, which will be taken to the board and the owners of the company.

"Upon their approval, we

announce the results. Then we open the financial bid.

The technical bid is to ensure that the people have competencies technically to be able to run efficiently and effectively a power plant of the size of which they themselves said they want to buy.

"Sometimes somebody may

be technically good but he does not have the money to pay. We look at the financials and see that they have the clout to do so. Then we announce the financial results.

"That hopefully according to our agenda will finish by J a n u a r y n e x t y e a r.

Thereafter, the preferred

winners and the runners up would be made known.

"Then we give them a period of six months to be able to gather all the money they need to gather. By June or July next year, all the payments would have been made.

"Do not forget they are investing in 80 percent

shares in the individual power plants that are existing. It is not as if we are selling the assets. They are buying into a growing concern. What they are buying is the ability of that growing concern to make money by giving power efficiently into the grid"

ECOWAS promises 'significant improvements' in power supply for citizens

T

he ECOWAS Commission President Kadre Ouedraogo has assured citizens of West African countries benefiting from the $108 million regional emergency energy programme that they would experience "significant improvements� in power supply by 2014.

Ouedraogo gave the assurance while speaking in Abidjan, during the signing ceremony for the grants to three ECOWAS beneficiary countries, The Gambia, Mali and Sierra Leone.

"Mali will get 54.32

million dollars; followed

by The Gambia with 31.8 million dollars and Sierra Leone 21.8 million dollars and the grants would be disbursed in two tranches over 12 months," he said.

O

uedraogo said that persisting energy deficit which became more acute in the last 10 years, had impacted negatively on the region’s competitiveness, productivity and economic growth.

The three countries are the latest beneficiaries of the regional programme based on requests by the states, and it is aimed at

enabling them to rehabilitate some of their generation infrastructure and network.

It is also aimed at build capacity, install pre-

payment metres and develop an improved mechanism for coordination and monitoring of their energy utilities.

Power

2014 January, SweetcrudeReports

20

AfDB N30bn to aid investment in Nigeria's power sector

African Development Bank building

T

h e A f r i c a n Development Bank, AfDB, has approved $184.2 million (about N30 billion) loan to encourage private investments into the Nigerian power sector.

The bank, which stated that the facility is coming under its Partial Risk Guarantee, PRG, said it also approved $3.1 million loan to enhance capacity building in power generation and distribution to meet the country's 40,000 MW target by 2020.

"The Board of Directors of the AfDB group approved an African D e v e l o p m e n t F u n d , A D F, Partial Risk Guarantee, PRG, program of $184.2 million and an ADF loan of $3.1 million for capacity building, to support the Nigerian power sector privatisation programme.

"The Board's decision will allow the AfDB to support the Nigerian Government's efforts to reform the power sector and position the country for sustainable and inclusive growth", the bank said in a statement.

According to the bank, the PRG programme in Nigeria

The Board's decision will allow the AfDB to support the Nigerian Government's efforts to reform the power sector and position the country for sustainable and inclusive growth", the bank said in a statement aims to increase the country's electricity generation by catalysing private sector investment and commercial financing in the power sector.

"The PRGs will mitigate the risk of the Nigeria Bulk Electricity Trading Plc, NBET, a Federal Government of Nigeria entity established to purchase electricity from independent power producers, IPPs. "It will also prevent the risk of not fulfilling NBET's contractual obligations under its power purchase agreements with eligible IPPs. "This in turn will increase the comfort level of private sector financiers and commercial lenders investing in the Nigerian power sector privatisation programme",

added the statement.

According to the bank, available data from the Nigerian government shows that power outages cost the country about three per cent of its GDP annually.

"It is anticipated that the IPPs eligible for coverage under the programme could generate additional 1,380 MW of power

by 2016.

"This will in turn increase Nigerians' access to more reliable and affordable electricity from 41 per cent currently to 50 per cent by 2016", the statement said.

The bank explained that the p ot ential impact of the programme would ensure effective and steady power supply, which is critical to the sustainability of Nigeria's development path.

The bank's Director for Energy, Environment and Climate Change, Alex Rugamba, noted that the Nigerian PRG programme was expected to improve productivity, economic activity and growth that would reduce poverty.

"In the short to medium term, the project will yield an increase in the maximum electricity supply and consumption per capita", he stated.

Mr. Rugamba held that Nigeria would need more private investment in the power sector to meet its development objective of ranking amongst the top 20 economies of the world by the year 2020.

The Director said that private sector investment was required in the supply chain for the country to meet the generation targets.

Nigeria's current maximum electricity generation capacity of approximately 5,500 MW is inadequate to meet demand estimated at a minimum of 10,000 MW.

“Rural power cost to remain low in Kenya’

T

he connection cost for the rural electrification programme in Kenya will not be increased for the next five years, the Ministry of Energy has assured.

The Principal Secretary, Joseph Njoroge said the government is sourcing more than $600 million (Sh51.93 billion) to enhance rural electrification and retain the existing connection charges so that more Kenyans can get power supply.

“Were have engaged with the African Development Bank and World Bank and the latter has factored in to dispatch some funds, which might stream in early next year. The feedback from the other lender so far is positive,” he said during the launch of energy journalism excellence awards in Nairobi.

EJEA is an initiative led by the ministry of energy and Kengen, with the aim of recognising and encouraging energy journalism in the country.

Power

2014 January, SweetcrudeReports

21

Idare hills

Govt reassures rural communities on renewable energy

T

he Federal Government is determined to ensure the electrification of rural communities through solar energy under its Rural Energy Access Programme, R E A P, a c c o r d i n g t o supervising Minister for Environment, Mr Darius Ishaku.

Making this known at the 4th Annual Nigeria Renewable Energy Day in Abuja, the minister said the ministry had started enlightening rural communities on energy switches that reduce emission and save lives through the programme.

“This includes the installation of Solar Home Systems to 600 households in Matum Biu in Gasol Local Government Area of Taraba.

This we intend to extend to do in other parts of the country so that we can have the kerosene lamp switch off grid communities,” he said.

According to him, Nigeria is the world’s largest importer of

Making this known at the 4th Annual Nigeria Renewable Energy Day in Abuja, the minister said the ministry had started enlightening rural communities on energy switches that reduce emission and save lives through the programme

Ekwunife, spoke on the ‘Role of Legislation on the Environment’, and urged Nigerians to embrace renewable energy.

Represented by Mr Ganiyu Olukolu, a member of the committee, Ekwunife said the National Assembly was committed to addressing environmental challenges through formulation of some legislation.

E

diesel generators, considering the emission factor this statistic, the cloud hovering over our major cities is directly linked to health hazards of inhabitants.

The minister said ShortLived Climate Pollutants, SLCP, had become a major development issue that calls for quick and significant worldwide action starting with individual country activities.

“We, therefore, believe that

Renewable Energy Programme of the ministry will help to educate, synergise and possibly scale up the development of clean and renewable energies as a means to reduce emissions of black carbon, methane and other SLCP. “Nigeria is embarking on a Green Investment Destination for Green Investors,” he said.

The Chairman, House of Representatives Committee on Environment, Rep. Uche

kwunife said one of the ways was the Petroleum Industry Bill, adding that the law when passed would help to address environmental pollution.

In his keynote address, Sen. Bukola Saraki, the Chairman, Senate Committee on Environment a n d E c o l o g y, s a i d a i r pollution and black carbon emission were detrimental to human health.

Saraki said the use of traditional cooking methods were issues that affect women and children mostly in rural areas.

“Globally, there are over four million deaths every year due to household air pollution, is the third most significant risk factor, killing almost 70,000 people every year-more than half of whom are children.

“This form of biomass energy use for cooking no doubt justifies the development of sustainable clean cook stove programme in Nigeria,” Saraki said.

He said providing environment for a thriving market for clean cook stoves was arguably the best strategy for the country to reach the last mile in adopting clean cook stoves technology and fuel.

Saraki said it was important for the stakeholders to have a collective plan that would hold them accountable and committed to playing a role in the efforts to reach a target.

“A target to reach at least 10 million households with cleaner forms of cooking energy and technologies by 2020,” he said.

2014 January, SweetcrudeReports

Power

N360bn spent on settlement of PHCN workers -BPE

22

Poor Services: Exercise your rights, NERC urges power consumers

T

he Nigeria Electricity Regulatory Commission, NERC, has urged Nigerians to exercise their rights, including seeking redress in court, over poor services by the companies operating in the power sector.

NERC chairman, Dr Sam Amadi, who disclosed this, said unlike in the past when electricity consumers did not have the right to sue the defunct Power Holding Company of Nigeria, PHCN, an unsatisfied customer could now take legal action against the power companies mainly because of the privatisation of the sector.

Amadi said: “The consumers have that right and I want to encourage consumers to exercise those rights. If people commit any violation of civil or criminal laws in the course of producing electricity, they are liable and could be convicted.”

Also, he disclosed that

PHCN Workers

T

he Bureau of Public Enterprises says the Federal Government has spent over N360 billion on the payment of severance benefits to workers of the defunct Power Holding Company of Nigeria, PHCN. BPE Director-General, Mr Benjamin Dikki said in an interview that the payment was in accordance with the agreement to settle the severance benefits to the affected workers.

Dikki said that at the beginning of the privatisation process, the budgeted cost for the settlement of labour liabilities in the sector was put at N401 billion.

"The BPE contributes N315.6 billion from the sale of PHCN asset, while the federal government provides N45 billion to bring the amount so far remitted to more than N360 billion.

"It would be recalled that the Federal Government had demonstrated great commitment in resolving labour issues in the power sector reform and privatisation.

"From the beginning, it had committed the entire proceeds realised from the sales of the

The BPE contributes N315.6 billion from the sale of PHCN asset, while the federal government provides N45 billion to bring the amount so far remitted to more than N360 billion power assets to the payment of the worker’s terminal benefits.

"The N360 billion so far spent was forwarded to the office of the Accountant-General of the Federation to settle 51,247 PHCN Staff, both active and retired,’’ he said.

Dikki also said that of the 51,247 workers, 47,913 were active staff, and 3,334 were retired staff of the company.

The Director-General said 2,158 staff, comprising casual workers and those nor properly documented, were yet to be settled.

"The reason is that some were not initially captured when we were taking into account all the workers, while at the same time, some deliberately refused to fill the forms provided.

"So, those remaining have issues. We don’t have sufficient records on them, so, we cannot

prove if they are bonafide staff or not.

"Until we conclude verifying their authenticity, we cannot just hand out funds to anyone,’’ he said, urging the affected staff to exercise patience as the bureau was working to rectify the issues as soon as possible.

matters relating to poor services could be brought to the attention of NERC for appropriate action, saying: “We have our consumer complaints unit, forum offices and we also have the NERC hearing.

"If consumers have complaints against the power firms, they should go through that proper channel, but nothing stops the high courts in the country from hearing matters that people feel they can take to court".

Noting that the the Electric Power Sector Reform, EPSR, Act does not exclude the jurisdiction of the courts to adjudicate on disputes based on Chapter four of the nation’s constitution, Amadi stated that the Act had "given the courts the right to determine such disputes".

"The courts will likely tell you to go to the forum’s office if it has not gone to that extent, but if it is something of judicial review of decision, of course, the courts will take it. So, there is no immunity in the system,” Amadi revealed.

He also urged power consumers to exercise the right of asking questions, stressing: “The consumers under the FoI Act should ask questions of regulators; ask questions of operators to show them the book. Ask us why you are charging this amount”.

Lagos can generate power, can't distribute - Fashola

L

agos State governor, Babatunde Fashola, is bemoaning the provisions of the Power Reforms Act enacted by the National Assembly to regulate the power sector, which according to him, has curtailed the intervention of the 36 states of the federation in power generation and supply.

“When we provide power for small estate like Isolo industrial estate, we do that because we own the estate. We can do self-embedded generation but we cannot sell power to the residents. Those are part of the assets that the distribution companies have bought,” Fashola told captains of industries recently at the third corporate assembly at the Lagos House, Marina.

According to him, the Alausa Power Plant built by the state has since led the Nigerian Electricity Regulation Company, NERC, to declare that the states “cannot distribute power.”

"We are regulated by the power reform act on how we can intervene in the sector. The power we are generating through the IPPs are for our own use, under the principle of embedded generation which the law allowed," the governor stated as he also disclosed that the state had no intention to go into power distribution.

According to the governor, were the state to have the intention of distributing power, “it will need to embark on separate agreement with the owners’ of that distribution companies. But by doing self generation, what that means is that we take ourselves away from the national grid.”

2014 January, SweetcrudeReports

Power

23

Oil pipline

Vandals now using dynamites to blow up gas pipelines - Nebo

M

inister of Power, Prof.

Chinedu Nebo, says sabotage against the nation's gas-topower network has assumed a new dimension as vandals were now using dynamites to blow up the pipelines.

Citing the case of the Western gas supply trunk line from Escravos to Warri, the minister said this was recently found to have been blown open at various points much beyond what had originally been thought.

“Another one at the Eastern axis at Bokoloma were punctured at many points and it would take the next one month to fix,” Nebo said while appearing before the House of Representatives committee on power.

“The worrisome problem associated with vandalism according informed the convocation of stakeholders’ forum by the office of the National Security Adviser (NSA). This forum brought together all security agencies to tackle the menace, it was resolved that information sharing among all

stakeholders is key to fighting vandalism,” the minister further stated.

Vandalism, according to him, has impacted negatively on power supply, slashing overall power output by 22 per cent last month.

The minister said the vandals have injured the nation’s economy so much and called on the lawmakers to enact stiffer penalties against the saboteurs to curb their excesses.

Recounting some of the achievements of his ministry last year, Nebo disclosed that the third Benin-Onitsha 330kV double circuit transmission line have been completed while the 215 megawatts (MW) Kaduna power plant was about 70 per cent into implementation.

The minister informed the parliamentarians of a new initiative by his ministry tagged "operation light up rural Nigeria” which the

Vandalism, according to him, has impacted negatively on power supply, slashing overall power output by 22 per cent last month

ministry with supports from President Goodluck Jonathan has embarked on to employ off-grid solar power systems to provide electricity to rural communities across Nigeria.

He said the president has given approved for about three pilot projects to be executed in each state of the federation.

ECOWAS promises 'significant improvements' in power supply for citizens

T

he ECOWAS Commission President Kadre Ouedraogo has assured citizens of West African countries benefiting from the $108 million regional emergency energy programme that they would experience "significant improvements” in power supply by 2014.

Ouedraogo gave the assurance while speaking in Abidjan, during the signing ceremony for the grants to three ECOWAS beneficiary countries, The Gambia, Mali and Sierra Leone.

"Mali will get 54.32 million dollars; followed by The Gambia with 31.8 million dollars and Sierra Leone 21.8 million dollars and the grants would be disbursed in two tranches over 12 months," he said.

Ouedraogo said that persisting energy deficit which became more acute in the last 10 years, had impacted negatively on the region’s competitiveness, productivity and economic growth.

The three countries are the latest beneficiaries of the regional programme based on requests by the states, and it is aimed at enabling them to rehabilitate some of their generation infrastructure and network.

It is also aimed at build capacity, install pre-payment metres and develop an improved mechanism for coordination and monitoring of their energy utilities.

Guinea Bissau and Guinea were the first beneficiaries under the programme which was launched in 2010.

2014 January, SweetcrudeReports

Power

24

'Afam to provide power in excess of 1,000mw'

Afam power station

SAM IKEOTUONYE

T

he new owners of t h e A f a m Generation Company, one of the firms created through the unbundling of the defunct Power Holding Company of Nigeria, PHCN, have pledged to provide power in excess of 1,000 when they assume total control of the asset.

“We are very happy and committed to the directives and issues in the SPA. We are excited and glad that this process has come to a conclusion. When we take over, we will be a catalyst for the energy sector,” a top official of the company, Mr. Oghens Sanomi, said as he made the pledge at the signing of the Share Purchase Agreement, SPA, with the Bureau of Public Enterprises, BPE, representing the Federal Government.

The National Council on Privatisation, NCP, had suspended bids for the Afam Generation Company over allegation that former Power Minister, Prof. Bart Nnaji, had interest in a company bidding for the firm.

A fresh bid process launched by the National Council on Privatisation, NCP, saw the emergence of Televeras as the preferred bidders.

A t t h e S PA s i g n i n g ceremony in Abuja, the Director General of BPE, Mr. Benjamin Dikki, said the exercise represented the concluding leg for the privatisation of the successor companies of the defunct PHCN. The signing ceremony also involved North-West Power Limited, the new owners of the Kaduna Distribution C o m p a n y, w h i c h privatisation process was also suspended by the NCP as none of the initial bidders met the technical criteria set

out in the bid for the company.

Chairman, North-West Power, Yusuf Abubakar, at the event, expressed optimism about his company performance in the future, s a y i n g : “ We k n o w t h e enormity of the task, we are committed to transforming the company into a world class one that will serve our people.

"It is our hope that we will also help in transforming the economy of the area so that the peoples’ well-being is assured. We thank BPE for a very transparent process”.

Solar station

Durumi solar-power project for commissioning soon

A

ll appears to be set for the commissioning of the solarpowered electrification project in Durumi, a suburb of Mpape in Bwari Area Council in Abuja.

The project which is under the auspices of "Light Up Nigeria Initiative" launched by the Ministry of Power in conjunction with Schneider Electric of France and Philips of Netherlands has brought changes to the economy of the rural community near Abuja.

Minister of Power, Professor Chinedu Nebo and the Special Adviser to the President on Project Monitoring, Prof.

Sylvester Monye, were at the project site for an on-the-spot assessment of the project.

Nebo, while speaking to the people in

the community, rhetorically asked them if they were happy with the president for siting the project in their community; and in unison, they said they appreciated government for the presence of the project in their area.

The minister urged the community to protect the equipment so that vandals would not come and cart them away. He assured the community that President Goodluck Jonathan was committed to the welfare of Nigerians and the provision of infrastructural projects that would boost the socio-economic activities in the rural areas.

Expressing satisfaction at what he saw, the minister disclosed that all is set for the commissioning of the

project by the president.

The Special Adviser to the President on Project Monitoring, on his part, said he was delighted with the project.

The project is reported to have transformed Durumi with children, women, men seen going about their business activities, happily.

The village square, and the streets leading to the palace, clinic and primary healthcare centre have all been energised with street lights.

Homes enumerated for the project is put at 1,005; about 95% of the homes already have electricity, while the remaining uninstalled homes equipment could be seen at the primary sector.

Finance

2014 January, SweetcrudeReports

25

Govt to reap $1bn in income tax from NLNG this year

T

he Federal Government would this year reap over $1 billion in company income tax from the Nigeria LNG Limited, according to the company's managing director and chief executive officer, Mr. Babs Omotowa.

Omotowa confirmed that his company would be paying as much as that sum to Finance Minister, Dr. Ngozi Okonjo-Iweala during her visit to the Nigeria liquefied natural gas, NLNG, plant on Bonny Island, Rivers State.

The NLNG plant which commenced operation in 1999 enjoyed a 10-year tax holiday which has since elapsed, paving way for the government to reap huge income yearly from income tax. It has also been earning huge revenue as returns on its investment in the $2.6 billion project.

Besides the huge income that had been going to the Federal Government in form of revenue from the export of the gas and the income from tax, the NLNG had contributed in reducing gas flaring from 65 per cent to about 20 per cent.

But Omotowa maintained that the gas flaring figure would improve while income going to the government would rise if the planned expansion of the NLNG plant becomes a reality.

According to the managing director, the company is already primed for the planned expansion. The sixtrain plant currently produces about 22 Metric Tonnes Per Annum, mpta, of liquefied natural for export and 5mpta of natural gas liquids, NGL. “NLNG Train Seven project will raise the liquefaction capacity of the Plant to 30mtpa, consolidating Nigeria’s position as one of the largest producers and exporters of LNG and sustained revenue for the economy,” Omotowa said.

Pointing out other potentials of the company, the NLNG boss disclosed that the company had last

LNG ship

year awarded contracts to Samsung Corporation a nd Hy und a i Hea v y Industry both of South Korea to build six ships.

The successful complrtion of the six new ships will see the number of ships in NLNG fleet to 30, meaning more revenue for the company's shreholders - the Nigerian National Petroleum Corporation, representing the Federal government, with 49 per cent stake; Shell Gas B.V. owning 25.6 per cent, Total LNG Nigeria (15 per c e n t ) a n d E n i International (10.4 per cent).

He said: "We are constructing six brand new ships in Korea and the total cost of constructi on is $1.3

billion. We are training Nigerians in the process.

"We will train over 600 Nigerians and 100 of them will be given advanced training too. 30 of them will actually go to Korea to learn

more about ship-building so that they will participate in the construction of ships.

“We are hoping to develop capacity so that in future, when we will have dry docks and other ship-building

facility in Nigeria, there will be Nigerians to do the work.

"They are being trained in ship-building. There are dry docks being built in Nigeria.” He said.

$1.68bn Deal: Oando set to become largest local E&P firm

B

y the end of this month, Oando, Nigeria's leading integrated energy group, would have become the largest indigenous oil exploration and production company in Nigeria.

This will come after the company would have completed the $1.68 billion acquisition of the assets of ConocoPhillips in Nigeria.

Oando Energy Resources,

the upstream arm of Oando Plc, last year extended the closure date of the acquisition by 60 days from November 30, 2013 to January 31, this year.

“The availability of $815 million in committed credit facilities from local and foreign banks and the already paid $435 million deposit place OER in good stead to finalise the financing of the balance

necessary to close the $1.68 billion purchase,” said Dr. Alex Iruna, Head, Corporate Communications at the Oando Group.

The acquisition, described as a transformational milestone, would make Oando the largest indigenous exploration and production company in Nigeria with 50,000 barrels of oil equivalent per day in production, 236 million in 2P reserves and over 500 million in contingent resources.

2014 January, SweetcrudeReports

Finance

26

NNPC Tower, Abuja

NNPC has fully met remittance of crude sales —GMD OSCARLINE ONWUEMENYI

T

he Nigerian N a t i o n a l Petroleum Corporation, NNPC, has met its statutory remittance of crude oil sales till date, group managing director, Mr. Andrew Yakubu, has said.

Yakubu also told journalists in Abuja that a routine annual audit of the corporation has commenced on the orders of Petroleum Minister, Mrs Diezani AlisonMadueke.

Speaking in the backdrop of the allegation by Central Bank of Nigeria, CBN, governor, Sanusi Lamido Sanusi, of unremitted $49.8 billion crude oil fund by the corporation, the NNPC boss described the allegation as "unfounded" and "baseless".

“The allegation is unfounded, baseless and has become a political instrument in the current politically charged environment. We are taken aback because there is hardly any operation that the

NNPC does alone; it is a multi-agency transaction and right from our production containment

and entitlements meetings, all the various agencies that are involved in crude oil production are involved in the meetings and reconciliation is done with lifting numbers agreed and signed off before the lifting of our crude oil," the NNPC boss said.

According to him, “operations at the terminals are also done by all the

NNPC is by statutory requirement responsible for direct remittances of only one stream of liftings, namely equity crude...

NNPC remitted its portion which is $18.48 billion (27.5%) into the federation account being the total proceeds from equity crude and gas sales of which CBN acknowledged receipt of $15.528 billion (24%)

various agencies and particularly championed by the regulatory agencies who are the arbiters of numbers and superintend over the process. NNPC is not a sole player in the entire business of the oil and gas value chain, so our functions are purely professional and we also have avenues to reconcile from time to time and we have no option whatsoever to determine the reconciliation of the numbers and our operations with all other agencies".

Yakubu disclosed that NNPC crude oil liftings is made up of equity crude, royalty oil, tax oil, volume for third party financing and the Nigerian Petroleum Development Company, NPDC, equity volume.

Remittances of proceeds from these liftings are made according to statutory and production arrangements, he said.

He further explained: “Accordingly, proceeds from equity crude is paid by NNPC into the Federation Account which is held by the

CBN. Proceeds from royalty oil is paid to DPR (Department of Petroleum Resources) whose designated account is managed by the same CBN, proceeds from tax oil or petroleum profit tax lifted by NNPC is paid directly into the FIRS account also managed by CBN”.

“NNPC is by statutory requirement responsible for direct remittances of only one stream of liftings, namely equity crude...

NNPC remitted its portion which is $18.48 billion (27.5%) into the federation account being the total proceeds from equity crude and gas sales of which CBN acknowledged receipt of $15.528 billion (24%)".

“On the issue of $49.8 billion or (76%) of total national liftings and the alleged unremitted funds, these are remitted to the various agencies which are statutory empowered to collect and remit same into the federation account,” Yakubu emphasized.

2014 January, SweetcrudeReports

Finance

NSE market indicators up 0.94%

E

q u i t y transactions o n t h e Nigerian S t o c k Exchange, NSE, opened after the Christmas holiday in an upward trend with the market indices growing by 0.94 per cent.

The All-Shares Index rose by 373.43 points or 0.94 per cent to close higher at 40,231.68 against 39,858.25 achieved on Tuesday, Dec. 24.

The Market Capitalisation, which opened at N12.755 trillion, appreciated by N120 billion or 0.94 per cent to close at N12.875 trillion.

An analysis of the price movement chart indicated that Nestle recorded the highest gain to lead the gainers table by N14.90 to close at N1, 200 per share.

It was followed by Total Plc

with a gain of N4.95 to close at N170 per share.

Lafarge Wapco appreciated

by N3.85 to close at N115, while Nigerian Breweries gained N2.15 to close at N164 per share.

Conversely, Guinness topped the losers' chart, losing N2.50 to close at N233 per

share. Ashaka Cement trailed with a loss of 17k to close at N20 per share.

Airservice depreciated by 9k to close at N3.20, while Dangflour and UPL lost 8k each to close at N9.31 and N3.98 per share respectively.

However, the volume of

27

The floor of Nigeria Stock Exchange shares traded decreased by 38.26 per cent with an exchange of 377.012 million shares worth N2.404 billion traded in 3,603 deals.

This is in contrast to the 610.607 million shares valued at N2.353 billion traded in 3,206 deals on Tuesday.

Staco emerged the most traded stock with 73.34 million shares valued at

N36.67 million.

It was followed by Unity Bank Plc with 47.09 million shares valued at N23.55, while NEM traded 37.33 million shares worth N25.72 million.

Transcorp sold 34.50 million shares valued at N160.78 million, while FCMB accounts for 29.29 million shares worth N104.62 million.

Local banks could finance GENCOs, says financial expert

N

igerian banks can play a major role in financing the activities of the privatised Power Holding Company of Nigeria, PHCN, generating companies, GENCOs, according to a financial expert.

The GENCOs and

distribution companies, DISCOs, were created through the unbundling of the defunct PHCN and were last year handed over to private investors under the Federal Government reform programme in the power sector.

"The (local) banks have the

capacity and they know that if they don’t get involved now, it will be difficult doing that later. So, this is about supporting indigenous opportunities,� Mr Robert Grant, group head, project and structured finance at FCMB Capital Markets Limited, said.

2014 January, SweetcrudeReports

Finance

28

Group stakes $50m on Nigeria’s energy infrastructure, others

T

he Old Mutual Investment Group says it would be staking $50 million on Nigeria’s energy infrastructure through its alternative investment arm from this year.

It is part of the overall $5 billion voted for the entire Africa by the group. The Nigerian investment would be made under the Nigeria Infrastructural Development Fund, the group said.

According head of Capital Raising at Old Mutual Infrastructural, Rojie Kisten, the company is also interested in investing in low housing scheme in the country.

Other areas of the company’s investment interest in Nigeria in the long term plan include the agricultural sector and railway sector.

Head of Alternative Investments at the group, Mr. Paul Boynton, who also spoke at the parley with journalists in Cape Town, South Africa, maintained that the Nigerian economy would be witnessing massive growth from the privatisation going on in the energy sector, saying it was important for the private sector to be involved.

Alternative Investments, Boynton said, is one of the largest alternative investment

Power transmission line

Banks under probe over handling of PHCN workers’ benefits

S

everal banks are current under probe by the Federal Government over their handling of the payment of severance package for exworkers of the defunct Power Holding Company of Nigeria, PHCN. They are being probed specifically for their alleged delay in the disbursement of the severance funds to the sacked workers of the former national utilty.

Minister of Power, Prof.

Chinedu Nebo, disclosed this, describing the delay in the processing and release of t h e p a y m e n t a s

embarrassing.

He noted, for instance that payment instruction given to a particular commercial bank on December 10 was yet to reach the office of the AccountantGeneration of the Federation, 13 days later.

Nebo told a stakeholders meeting attended by the Minister of Labour, new owners of PHCN successor companies and other power industry stakeholders, that the non-payment of entitlements to the electricity workers weeks after it ought to be due was frustrating.

According to Nebo, the meeting was called to finalise

issues of labour relations between the new owners of the PHCN successor companies and the workers, so as to prevent disharmony that could hinder speedy delivery of power to Nigerians.

The minister, who empasized the need for the new owners to establish a good human resource department that will constantly engage labour, said they should embrace this rather than discouraging union activities.

In his own contribution, Minister of Labour and

Productivity, Chief Emeka Wogu urged strict adherence by the new owners of the generation and distribution companies to the provisions of Nigeria’s labour l a w s a n d International L a b o u r Organisation 1949 Convention, both supporting the existence and operation of workers’ unions.

managers in Africa, with assets under management of approximately $5 billion as at October 2013 and manages investments in p r i v a t e e q u i t y , infrastructure, mezzanine debt and a range of impact funds.

He said the company builds capabilities that generate investment outcomes with higher returns than traditional asset classes or with lower correlation to traditional asset classes, which results in diversification benefits for clients portfolios.

“We leverage our respected brand, depth of experience and expertise as well as our extensive network of strategic relationships to produce attractive deal flow; execute projects professionally and timeously; continuously add value as well as focus on sustainability,” he stated.

2014 January, SweetcrudeReports

29

Labour

2014 January, SweetcrudeReports

30

Labour to FG: Don't privatise refineries, deal with PIB ELUONYE KONYEGWUAEHI

W

orkers in t h e Nigerian petroleum industry have reiterated their opposition to the planned sale of the nation's four refineries in Warri, Kaduna and Port Harcourt by the Federal Government, urging rather that government expedites action on the passage of the Petroleum Industry Bill, PIB, still before the National Assembly.

According to them, the issue of the refineries has been adequately addressed by the PIB and the only thing needed to be done is the passage of the bill by the legislature.

The oil industry made the disclosure as they warned the Federal Government to prepare for a "battle" with Labour that could disrupt industrial peace in the oil and gas sector, if it insisted on proceeding with the privatisation plan.

The workers, under the aegis of the Nigeria Union of Petroleum and Natural Gas Workers, NUPENG, and the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, said they would be embarking on strike any moment from now and that they have found it necessary to "put the government and the entire country on notice of their resolve to cripple the oil sector to ensure that the refineries considered as national heritage are not sold to cronies and fronts of government officials to the detriment of the entire nation".

Speaking on behalf of the two unions after NUPENG's National Executive Council meeting in Port Harcourt, NUPENG President, Comrade Igwe Achese, said it was shocking that the Federal Government could contemplate selling the refineries when even non-oil producing countries were building and expanding their

A refinery

We have to restate it, again and again, that we will not accept the planned sale of the refineries.

Not in our time. They were handed over to us by our founding fathers and we intend to also keep the refineries for generation yet unborn

participation in crude refining.

He asked the promoters of the planned sale of the refineries to name one oilproducer country that was not expanding refining capacity outside Nigeria, the ninth largest oil producing country in the world.

According to him, “We have to restate it, again and again, that we will not accept the planned sale of the refineries. Not in our time. They were handed over to us by our founding fathers and we intend to also keep the refineries for generation yet unborn. If past government had sold them, what would this government be talking about? When the (ex-President Olusegun) Obasanjo government tried it at the twilight of his government, the succeeding government had to reverse the sale in the national interest because of

opposition from most Nigerians, including organised labour. What the refineries need is comprehensive turn around maintenance and sound management.”

“None the less, the issue of the refineries has been adequately addressed by the Petroleum Industry Bill (PIB). The government should put in more energy to ensure that the PIB is passed with concerns of stakeholders well addressed. We are all living witnesses to previous privatisation exercises and the fate of such organisations. We cannot afford to toy with the refineries. We are using this medium to put government and Nigerians on notice that should government fail to listen to us and other wise counsel, we shall not hesitate to shut down the entire sector.”

Comrade Igwe also challenged the government to tackle the increasing unfair labour practices in the sector, especially casualisation, contract labour and out-sourcing, warning that “it is a time bomb waiting to explode and throw the entire sector into chaos.”

Petroleum Minister Diezani Alison-Madueke announced plans by government to sell the refineries few weeks back, but re-assured that organised Labour would be carried along in the process leading to the sale.

Mrs Alison-Madueke could not be reached for comments on the NUPENG and PENGASSAN latest strike threat. Telephone calls and text messages to the minister and her assistants, including Mr Eric Ufo Atuanya and Kevin Alonzo, were not responded to until time of going to press.

2014 January, SweetcrudeReports

Labour

31

OLUONYE KONYEGWUAEHI

M

aritime Workers Union of Nigeria, MWUN, has petitioned President Goodluck Jonathan, condemning the recent 75 percent hike in tariff of imported vehicles to the country. The union argued that if allowed to stand it, the plan would not only threaten ports operations, but lead to massive loss of jobs.

In a petition by the President-General and Secretary-General of the union, Anthony Emmanuel Nted and Aham S. Ubani, respectively, dated December 27, 2013, MWUN said: "We have roll on/roll off terminals in our ports specifically built for exclusive handling of imports and exports of vehicles. In this terminal, over 95% of workers are Nigerians who earn their living on RORO operations. To the best of our knowledge most of the vehicles assembling plants we used to have in this country no longer exist.

"If, therefore the federal government is serious in h a v i n g v e h i c l e s manufactured in this country and in making Nigerians patronise made in Nigeria vehicles, the first thing to do is to provide the enabling environment. This includes local production of parts needed for the vehicle production, steady power supply and all necessary infrastructure which are obviously lacking today."

The petition continued: "Today, and indeed in this festive season, the government policy on importation have made it difficult for genuine rice importers to bring in their rice through our ports. Many rice vessels destined to our ports are now being diverted to port of neighbouring countries. The negative effect of this is massive: Revenue accruing to the nation is lost to other neighbouring countries.

Nigerians, who are supposed to work and earn their livings on this, are denied the work and livelihood. Large scale smuggling is thus encouraged are not controlled.

"The business of fake/rebagging of inferior quantity rice not fit for human consumption is also out on the increase. This portends serious health

Imported cars at the port

Imported Vehicles: Hike in tariff'll kill jobs, hurt ports —Labour hazards and drawback in our economy. The announcement of the minister of agriculture that Nigeria is able to produce enough rice locally, to feed itself is as at now a mere projection and cannot be realised in short term given our high level of rice consumption as a staple food. We therefore suggest that in the interim; that the benchmark on imports of rice be reviewed downward to encourage genuine

importers to bring in the rice through Nigerian ports, reduce massive smuggling and effect proper quality control.

"This will also enhance cargo throughout in our ports and job security of Nigerians working in the maritime sector. We wish to point out that the effect of these policies is capable of heightening/provoking social unrest in the country and therefore portends danger in this pre-election

year (2014)."

The union advised the Federal Government to review these policies and defer their implementation in the national interest.

"Furthermore, our members are yet to recover from the m a s s i v e l o s s o f unemployment during the port concession era and cannot bear any mass retrenchment which the current policy of government on tariffs/levies and bans/prohibitions portends.�

NLC boss tackles FG for over-reliance on oil

V

i c e President of Nigeria Labour Congress, NLC, Issa Aremu, has berated the Federal Government for continued over-reliance on oil for its yearly budget, describing the situation as "sad".

"The point I want to raise is that 53 years after independence, it is sad that we still rely on

crude oil. The fundamental of our budget still rely on one source of revenue which is oil.

"I think I want to say next year the federal government should redouble its effort to make sure we add value through manufacturing sector. The only way to do so is for us to do as much as possible to revive the industries, not just the textiles but the automobile, food and beverages," Aremu said at a news conference in

Kaduna, to review the activities of the government for 2013, Harping on the need to diversify the economy, he said: "There is a report that came out recently in a business newspaper that close to 130 companies have closed down in Nigeria. So, while our government is talking of direct foreign investment coming to Nigeria, we should make the point that the domestic investment is actually

dying, and you cannot create jobs if there are no industries. In fact, for us to solve the problem of unemployment is for us to add value to our natural resources and raw materials and process them into manufactured products.

"This is where I think government has taken a bold decision on the new automotive policy which is to restrict the wholesale importation of imported second hand vehicles.

2014 January, SweetcrudeReports

Labour

32

Electricity union issues ultimatum over PHCN workers pay SAM IKEOTUONYE

T

he New Year may be herald by an industrial action by the nation's electricity workers, who have issued a 14-day ultimatum to the Federal Government that expires on January 5, over unresolved labour issues in the power sector Operating under the aegis of the National Union of Electricity Employees, NUEE, the workers said in a petition to Minister of Power, Prof Chinedu Nebo, that they would be shutting down the power sector should all the entitlements of the defunct Power Holding Company of Nigeria, PHCN, not paid to them at the expiration of the ultimatum.

“We are constrained to write your office on the flagrant abuse of human and Trade Union rights in the Power Sector and the criminal silence by those that should have checked these abuses," the petition by NUEE president and general secretary of the Union, Mansir Musa and Joe Ajaero, read.

They lamented that the entitlements of most of workers had remained unpaid months after the hand over of the sector to private individuals.

This development has dashed hopes that all labourrelated issues associated with the unbundling of the PHCN and the resulting privatisation of the power generating companies, GENCOs and distribution companies, DISCOs, may have been resolved.

NUEE said it would be compelled to embark on an industrial action over government’s refusal to honour agreement jointly entered into, as well as the flagrant abuse of trade union rights by operators and regulators in the industry.

The petition to the Power Minister stated that the union had waited patiently for the ministries, departments and agencies, MDAs, "to do the needful but to no avail".

It stated that all the collective agreements entered into with government have all been

Oil barrels

There is a report that came out recently in a business newspaper that close to 130 companies have closed down in Nigeria. So, while our government is talking of direct foreign investment coming to Nigeria, we should make the point that the domestic investment is actually dying violated, adding that about 10,000 workers in the power sector have not been paid a dime as their severance entitlement.

AfDB adopts labour safeguards

T

he African Development Bank, AfDB, has directed that all its borrowers must c o m p l y w i t h International Labour Organisation, ILO, core-labour standards a n d o t h e r requirements protecting workers.

I n a d o p t i n g " O p e r a t i o n a l Safeguard 5: Labour Conditions, Health and Safety," OS 5, the AfDB requires that all bank borrowers comply with the ILO core labour standards, provide written information to workers about their working conditions and rights, comply with basic occupational health and safety standards, and take responsibility

for the conditions of "thirdparty" (subcontracted) workers.

The adoption of the new safeguards culminates in a four-year process to which trade unions contributed recommendations.

It follows the example of the labour performance requirements adopted in 2006 by the World Bank’s private sector lending arm, the International Finance Corporation, IFC. While largely similar, the AfDB policy appears to put a stronger requirement on borrowers to ensure that its contractors also comply, instructing that "the borrower or client incorporates these requirements (of OS 5) in contractual agreements with its contractors, subcontractors and intermediaries".

The IFC requires only that

b o r r o w e r s ‘ u s e commercially reasonable efforts’.

T h e A f D B h a s announced that it will develop assessment procedures and a tracking system to enable it to monitor implementation of the new requirements.

Jenny Holdcroft, policy director at IndustriALL Global Union, says that monitoring by trade unions has played an important role in ensuring compliance with the IFC labour safeguards.

It will be important for African trade unions, the ITUC and Global Union Federations to comment on the effectiveness of the assessment and tracking procedures as they are established, and to monitor AfDB projects regarding compliance with the safeguard on an ongoing basis.

Solid Mineral

2014 January, SweetcrudeReports

33

Nigeria awaits fresh development funds from World Bank

N

igeria is e a g e r l y awaiting fresh grants from the World Bank Micro-Credit scheme for artisanal miners.

The Bank granted $2.5 million to 50 mining cooperatives across the country in its latest project year which ended earlier in May. Director, Artisanal and Small Scale Mining Department at the Ministry of Mines and Steel Development, Mr Obiora Azubike, who disclosed this, stated that the last disbursement of funds under the scheme was before the closure of the project year in May and that the next disbursement was expected as soon as the Solid Minerals Development Fund begins full operation.

According to Azubike, each of the 50 co-operatives got $50,000 (about N8,250,000) through the micro-credit scheme. Both the miners and their host communities benefited from the grant, he said.

"The unit of disbursement was 50,000 dollars. But before you are given the money, you are expected to also bring in some of your own matching grant, but not necessarily in cash.

"So, whatever you are able

World Bank office to produce on your own will depend on how much you will be given. But the highest is 50,000 US dollars. The World Bank Micro-Credit Scheme

has ended. So, right now there is no World Bank Micro-Credit Scheme for artisanal miners.

"The one we had before

under the Sustainable Management of Mineral Resource Project has ended," Azubike said.

Azubike also stressed the

need for the Federal Government to increase the funding of the sector through increased budgetary allocation.

...To adopt Chinese technology in exploitation of minerals 50 co-operatives got $50,000 (about N8,250,000) through the micro-credit scheme. Both the miners and their host communities benefited from the grant

N

igeria is currently making efforts to develop its mineral resources using China’s advanced technology, according to Minister of Mines and Steel Development, Mr Musa Sada.

The minister said at the bilateral meeting between the Nigerian Geological Survey Agency, NGSA, and the China Geological Survey, CGS, to perfect the M e m o r a n d u m o f Understanding, MoU, signed last year.

Represented by his Technical Assistant on Mines, Mr Umar Hassan, the minister said China desired to exploit mineral resources from all corners of

the world.

He said: "We have virgin mineral field for china to develop for us and such mineral resources will contribute to our economic development."

Mr Nwegbu Ndubusi, the Director-General of NGSA, said the country would collaborate in the areas of geological maps, compilation of regional minerals, correlation, geodata construction and sharing.

Others are geology of environment and geohydrology, monitoring and prevention of the geohazard, remote sensing, geo-statistics, and geochemical analysis.

The agency would also

collaborate in the areas of chemical exploration, marine geology, mineral resources exploration t e c h n o l o g y a n d methodology as well as research in the basic geology of Nigeria.

He said that China had advanced technology in these areas.

"There is need to improve on the MoU we had on mineral deposits. NGSA deserves to tap into the technology in China as it is more advanced in geosciences/explorations.

"For us to get to the level of the best in the world, we need to cue into the technology and expertise of China," he said.

According to him, the

country needed to improve on its mineral development to attract investors to the mining sector.

Ndubusi said one of the major challenges facing the sector was insufficient geosciences data to enable the investors to make investment decision. " T h r o u g h t h i s collaboration, the country will improve on its geosciences data.

"The whole idea is to locate mineral deposits such as gold for investment as well as to locate minerals that are toxic to the environment," he added.

He disclosed that the agency would send some of its staff to train in exploration and laboratory analysis in Beijing.

2014 January, SweetcrudeReports

Solid Mineral

34

Underground mining

Bank to raise operational funds for mining sector to 10%

M

r Robert Orya, the Managing Director, Nigeria Export-Import, NEXIM, Bank, says the operational funds to the mining sector would be increased to 10 per cent to develop the sector.

Orya said in Abuja that the operational cost was increased from three per cent to 10 per cent to fast track

development in the sector, addding that a lot of potential which had not been fully harnessed were abound in the sector.

“What we are doing, the little operational funds in NEXIM, we are deploying at least 10 per cent. Two years ago, we had targeted three per cent of our total loanable funds to that sector.

“But because of the importance, because of the

huge potential, we have been able to move that from three per cent to 10 per cent of loanable funds.

“Again, we are trying to unveil commercial lines of credit from other NEXIM banks in the world, so that we can bring it as investment capital to supplement what we are doing,’’ he said.

He maintained that due to the huge potential in the

'Why miners, investors must sign development pacts with communities'

1

7 December 2013, Abuja - The Federal Government has urged miners and investors in the nation’s mining sector to sign community development agreements with their host communities.

Minister of Mines and Steel Development, Mr.

Musa Sada, who made the call in Abuja, also urged investors in the sector to forge joint ventures to bring rapid development to the sector.

“Miners and investors in the nation’s mining industry should endeavour to sign community development agreements with the various community development

associations in their host communities instead of with a village or community head to avoid unnecessary clashes in their operations across the country," he told members of the Miners Association of Nigeria, MAN, during their visit to his office.

The miners were led to the

sector, the government would one day decide to have specific intervention funds to make the sector competitive.

Orya said that with the intervention funds, commercial banks would begin to fund the sector.

According to him, the bank will allocate 10 per cent of what it generates annually to the mining sector to enhance its operations. ministry by the president of MAN, Alhaji Sani Shehu.

“Mining nations all over the world started to grow their mining industries with joint venture strategy for rapid growth and development, which had at the end attracted direct foreign investments, and now are big players globally.

He stressed the need for miners to continue to partner with NEXIM bank and other financial institutions to improve their activities.

“It is a sector that has a lot of potential and it also has a lot of challenges.

“But the minister has done so much in reforming the sector, some of the structural challenges we are having, I am sure a lot of them have been addressed," he added.’’

Orya said that with the discovering of 44 minerals in commercial quantity across the country, if developed, would boost the revenue base and create a lot of job opportunities for jobless Nigerians.

He said that South Africa, which had less mineral resources than Nigeria generated 60 per cent of its GDP from the mining sector.

The managing director expressed regret that the contributions of the sector to the country’s GDP was less than one per cent.

2014 January, SweetcrudeReports

Solid Mineral SYLVESTER AROH

T

h e transformation agenda of the J o n a t h a n administration has been equivocal in its determination to liberate Nigeria from the shackles of the nation’s mono-economic dependence on the oil sector.

It is to this end that the Jonathan administration has embarked on revitalising the solid mineral sector.

Nigeria is blessed with rich mineral resources. It is on record that almost all the thirty-six states of the federation and the Federal Capital Territory have one or more mineral deposits in stock. Unfortunately these mineral deposits, which can sustain some countries in the world, are yet to be maximally harnessed in Nigeria until in the recent time.

It is against this backdrop that the Jonathan administration’s efforts in making the mineral sector work have been appreciated by micro-economic development observers in Nigeria. It is also crystal clear that the development of the solid mineral sector in Nigeria can only be achieved when specialized institutions in the nation’s micro and macro-economic sector play their roles maximally.

Nexim Bank, one of such institutions, has taken the bull by the horns by spearheading the development of the solid mineral sector in Nigeria.

Like President Goodluck Jonathan rightly observed, the mineral sector together with manufacturing, agroprocessing and services (tourism and entertainment) are the constituents of Nigeria’s ‘Mass Agenda’ conceptualized to intervene, and thereby drive growth in the non-oil sectors of Nigeria’s economy.

T h e m a n a g i n g director/chief executive of Nexim Bank, Mr Roberts Orya, has not minced his words in making the impacts of Nexim Bank open in the transformation agenda of President Goodluck Jonathan.

According to him, “Nexim Bank’s intervention in the solid mineral sector is structured as is the case with other three sectors of focus.

We combine funding with capacity-building. We engage stakeholders to identify obstacles to the growth of the solid mineral sector. And we look at efficient ways to remove the barriers.”

The development of Nigeria’s solid mineral sector

Mr Orya

SOLID MINERAL DEVELOPMENT:

The Nexim Bank perspective is a global challenge. It involves not only making the sector merely open for investors but providing the atmosphere for such operations to be conducive and encouraged. This Nexim Bank has come to fill the gap in conjunction with other stakeholders.

In the words of Roberts Orya, “Once we have the initial local private investment in place, with government approval, I am pretty confident that foreign capital will follow. Like the oil and gas sector, we can attract global companies to come here (Nigeria) and invest in the solid mineral sector.”

The intervention of Nexim Bank as well as other specialized institutions has been enhanced following the passage of the Minerals and Mining Act 1999 which has provided a robust legislative framework for the sector.

On a general note, the solid mineral sector of Nigeria has a great prospect for many reasons. The recent roadmap by the Federal Ministry of Mines and Steel Development is encouraging. Apart from the roadmap, Roberts Orya is of the opinion that other measures already adopted in the sector will revamp the mineral sector.

Echoing him, “Improved geological information,

As the nation’s solid mineral sector is being revamped with such supports from Nexim Bank, it is necessary to recall the journey of Nigeria to the solid mineral sector so far favourable policy framework for local and international investors, the new national solid minerals policy, availability of low mining technology and recovery from the slump in the prices of metals in the global market will ensure the Nigerian mining industry revamps.”

At the last count, the Federal Ministry of Solid Minerals Development (Ministry of Mines and Steel Development, with a wider mandate) has confirmed that Nigeria is blessed with thirty-four solid minerals currently being promoted for investment. The identified minerals are capable of

playing a key role in Nigeria’s housing, infrastructure, and construction industry. They include coal, iron ore, limestone, granite, marble, bitumen, gypsum, talc, lead/zinc, gold, kaolin, copper, soda-ash, rock salt, uranium, limestone, uranium, tin, asbestos, columbite, to mention a few.

One huge benefit of the Roberts Orya-led Nexim Bank in contributing maximally to the development of the solid mineral sector is the sector’s multiplier effect in job creation for the teeming youths of Nigeria. From available records, the number of Nigerian youths unemployed outweighs those employed. The imbalance has also led to the economic retrogression of Nigeria as a lot of manpower is constantly being wasted due to under-utilisation of the nation’s human potentialities. Thus the intervention of Nexim Bank in diversifying the solid mineral sector is a welcome development because it is a singular act that will make the fortunes of Nigeria not the same again.

The recent assertion of Orya that Nexim Bank has resolved to create and

35

sustain 15, 000 jobs in the non-oil sector has been heartrending. The chief executive has therefore assured that Nexim Bank will make this laudable goal realizable through the provision of finance and enhance industrial capacity as well as support the acquisition and adoption of new and clean technologies, thereby ensuring competitiveness of Nigerian products and manufacturing operations.

In his words, “The bank’s funding intervention in support of exports has created and sustained 60, 000 jobs in the past few years: 2009 – 25000 jobs, 2011 – 35, 000 jobs. The bank support has attracted foreign generation of about 100 million dollars annually, making a total of 200 million in the past years.” The determination of Nexim Bank to generate multitude of jobs in Nigeria is premised on huge intervention in the sectors with higher investment potentialities such as mining, agriculture, tourism, and creative arts.

Economic analysts are of the opinion that if Nexim Bank sincerely delves into the solid mineral sector as well as other non-oil sectors, Nigeria will mark a sporadic economic turnaround.

Records also indicate that the bank is not new in this sector because it has supported the Nigerian nonoil export to the tune of N20 billion naira.

Orya said, “As regard the intervention in the next five years, our strategic plan is to support the non-oil sector to the following minimum level: 2011, N37 billion; N2012, N41 billion; 2013, N50 billion; 2014, N63 billion; and 2015, N94 billion.”

As the nation’s solid mineral sector is being revamped with such supports from Nexim Bank, it is necessary to recall the journey of Nigeria to the solid mineral sector so far. Before the discovery of oil, Nigeria’s solid mineral sector was being harnessed orderly. The sector was then majorly in the hands of the foreigners.

The Jos tin ore, Enugu coal mining among others readily come to mind. However the discovery of oil in commercial quantities later killed the advancement already recorded in the solid mineral sector.

So far the Jonathan administration has shown that the non-oil sector of the economy remains the only option for the nation’s economic development. *Aroh is the Northern Regional Editor of a Lago-based Research Intelligence Magazine.

Freight

2014 January, SweetcrudeReports

36

TOJU VINCENT

A

s part of efforts to arrest piracy in Nigerian waters, a United Kingdom-based firm, Secure Anchorage Area, SAA, in collaboration with a Nigerian shipping firm, Ocean Marine Security, have created a partnership that will provide a secured anchorage for vessels in the nation’s waters.

Speaking at the launch of a sec ure anchorage area offshore Lagos, SAA’s Operations Director, Sven Hanson said the anchorage area is located c.10 nautical miles, NM, south west from the entrance to Lagos Port Channel.

Hanson said the initiative was launched to provide 24hour protection for vessels, otherwise vulnerable to attacks as they waited to berth. It will also cover those conducting ship to ship, STS, operations offshore Lagos.

The new arrangement, which enjoys strong supports from the UK and Nigerian governments, is expected to offer protection solution to both domestic and international shipping companies that need protection from piracy.

According to Hanson, SAA has been providing protection for offshore access and client vessels in the Niger Delta before now but only extended its services to offshore Lagos.

He explained that the arrangement is such that there would be dedicated Nigerian Navy patrol boats with mounted weapons, capable of enforcing a 200 nautical miles maritime exclusion zone.

Also speaking, Managing Director of SAA, Mr. Nick Dixon, assured that effective security solution, would bring succour to ship owners and increase trading activities in country.

“The most interesting thing here is that the Nigeria Navy patrol boats ensure all potential threats are neutralised a significant distance away from where the clients of SAA are securely anchored,” he said.

Although SAA is a private sector organisation that is offering a viable maritime security solution to vessels

Port harbour

UK, Nigeria firms partner to secure Lagos anchorage The most interesting thing here is that the Nigeria Navy patrol boats ensure all potential threats are neutralised a significant distance away from where the clients of SAA are securely anchored

TOJU VINCENT

F

ormer Director General of the Nigerian Maritime Administration and Safety Agency, NIMASA, Dr. Ade Dosunmu has called for the establishment of more

owners, it requires the assistance of the Nigerian N a v y a n d o t h e r stakeholders from the oil and gas and shipping industries to ensure that pirates are prevented from getting into vessels, in addition to solving the problem of piracy, which has been existing in the Gulf of Guinea for over 30 years.

“SAA is a private sector company that is offering security service with the Nigeria Navy and others. A lot of commercial vessels at present are entering Nigerian waters to get their place of berth, but they are told that their place of berth is not available and they have to take the risk of returning to a 150 nautical

miles offshore and drift for maybe two weeks until the place becomes available.

"So, what we have done is to secure a 24/7 safe anchorage area nearer vessels' place of berth to ensure safety and minimal risk to the environment in the event of spillage from transfer of hazardous cargo from one platform to another.

Dosunmu, NIMASA ex-DG, calls for more maritime academies maritime academies in order to further decentralise the existing Maritime Academy of Nigeria, MAN, in Oron, Akwa Ibom State.

Dosunmu made the call last week at the award and gala night of the 25th anniversary celebration of the Maritime Reporters Association of Nigeria, MARAN.

The erstwhile NIMASA boss stated that there was need for Nigeria to concentrate its efforts in building both human and infrastructure capacity, even as he urged that Nigeria took s cue from the Philippines which has 50 million citizens with over 30 maritime academies.

He said the main focus of the Nigerian Seafarers

Development Programme, NSDP, which he initiated few years ago must not be lost on the current implementors. According to him, the NSDP programme was not designed to be a permanent solution to the dearth of seafarers in Nigeria; rather, it was fashioned as a stop-gap measure to meet Nigeria’s demand for seafarers.

2014 January, SweetcrudeReports

Freight

37

US Coast Guard revisit Nigeria to monitor ISPS implementation TOJU VINCENT

O

fficials of the United Sates Coast Guard are yet again in Nigeria to monitor the implementation of the International Ships and Ports Facility Security, ISPS, code.

Senior Special Assistant to the President on Maritime Matters, Mr. Leke Oyewole disclosed that the visit of the United States coast guard officials is a follow up to two previous visits.

The officials, according to Oyewole, are to visit some facilities in the Eastern ports particularly in Calabar, the Cross River state.

It was also gathered that the coast guard team will review the checklist and processes of implementing the guidelines of the code to correct any inherent abnormally that may arise.

Besides monitoring the implementation of the ISPS code, the team will also inspect how drills are conducted by the Port Facility Officers of some of the terminals.

A source close to one of the Recognised Security Organisation disclosed that some of these facilities are yet to meet the proposed standard of security levels and arrangements in their terminals.

It will be recalled that the United States government last year issued a 90-day ultimatum to the Nigerian government requiring its Designated Authority, DA, for International Ship and Port Facility Security, ISPS, Code implementation.

The issuance of the ultimatum resulted in the Nigerian Maritime Administration and Safety Agency, NIMASA, being appointed as the Designated Authority to ensure nationwide compliance to the code.

The ISPS Code was adopted by the International Maritime Organisation, IMO, and became mandatory for implementation by all contracting governments in July 2004.

The objective was to

establish an international framework that would help ensure the global maritime domain was better secured from the threat of terrorism.

The code was to apply to vessels above 500 gross tonnage engaged in international voyage as well as the port facilities, PFs, servicing them.

Nigeria, being a signatory to the IMO charter, was among the member states that ratified the code and thus set out to implement the code in order to ensure the nation’s compliance by the due date.

Consequently, the government of President Olusegun Obasanjo in 2004 inaugurated the Presidential Implementation Committee on Maritime Safety and Security, PICOMMS, to act as the country’s DA and to ensure the nation’s compliance as required by the ISPS Code.

Nigeria was able to meet the deadline and was confirmed by the IMO as compliant that same year.

PICOMSS continued to function as the DA until the committee was formally wound down late 2012.

On May 21, 2013, the DA mandate was formally transferred to NIMASA following an official letter issued by the Ministry of Transport.

Upon receipt of the letter, the agency immediately set out to institute a fresh implementation programme as needed.

Coast border patrol

NPA sees 19.8mm/t cargo traffic

T

he Nigerian P o r t s Authority, NPA, saw cargo traffic for the third quarter of last year reach 19,849,258 metric tonnes as against 19,340,901 for same period in the preceding year, a

statement from the organisation said.

It said in the statement signed by its Assistant General Manager, Public Affairs, Mr. Musa Illya, that the cargo throughput of 19,849,258 metric tonnes for the third quarter of 2013 showed an increase of 2.6% over the 2012 third quarter

figure.

The increase in cargo traffic, which excludes that for crude oil terminals, has been attributed to the deepening of the Lagos port channel which is currently being handled by the Lagos Channel Management Company Limited.

According to the

statement, the port channel is currently at 13.5 metres which has made it possible for bigger vessels to sail into the ports without hitches.

This has provided shipping companies with a high level of efficiency and economic space which has enhanced their turnover and turnaround time.

2014 January, SweetcrudeReports

38

Motoring

2014 January, SweetcrudeReports

39

2014 SUV Buying Guide What you should know Top Recommended SUVs

T

he car-based crossover has revitalized the market for utility vehicles, as this new breed combines the trucklike utility that Americans prefer with the carlike comfort and fuel economy they expect. Old-school, truck-based SUVs are still the default choice for towing and rugged off-road adventure, but crossovers are becoming more capable for these tasks as well. Overall, utility vehicles appeal to consumers looking for an extra-spacious passenger package with an easily accessible place for cargo. And while the number of super-size, truck-based SUVs has dwindled, the compact crossover subcategory is one of the fastest-growing vehicle segments. Here we don’t separate SUVs from crossovers (in some instances the distinctions between the two are negligible), but instead divide the entire category by price range.

Honda CR-V

SUVs Under $25,000 When it comes to transportation for small families, it’s hard to beat the Honda CR-V . Thoughtful design and useful features are evident throughout, while the CR-V’s generous interior dimensions make easy work of hauling people and cargo. On top of that, excellent safety scores offer a high level of confidence when shuttling your precious cargo, plus the CR-V’s favorable fuel economy is a big plus for your budget. One of the only drawbacks is the lack of a more powerful engine option, but we still think most drivers will find the Honda CR-V appealing, especially when fuel economy is factored into the equation.

The Ford Escape is all-new this year and has managed to impress us right out of the gate. It checks off all of the items that a small family needs — as all good crossovers should — and sweetens the deal with agile handling, a pleasing cabin and comfortable seating for all. Unlike the Honda, the Ford Escape gives buyers the choice of three engines that all achieve favorable fuel economy ratings.

Budget-conscious buyers should keep tabs on their options, though, as the price can climb very quickly as items are added.

Also new this year is the Mazda CX-5 , which receives similar high marks as the Honda CR-V and Ford Escape. Additionally, the Mazda comes with daring styling plus a dash of fun-to-drive character. As an added bonus, the CX-5 could leave a couple thousand dollars in your pocket compared to the other crossovers. The Mazda CX-5 is a relative newcomer to our list, but its new position is certainly well deserved, especially since it puts so much sport into a segment that is otherwise perhaps a little too preoccupied with family values. The Mazda CX-5 crossover offers adventure, not just a trip to the store.

Ford Escape

Top Recommended 2013 Honda CR-V 2013 Ford Escape 2013 Mazda CX-5

SUVs Under $34,000 The Ford Flex is equal parts manageably sized minivan and budget limousine. The Flex’s boxy profile and vast interior mean you get almost all of the utility — and passenger-carrying capacity — of a minivan, but with none of the minivan stigma. Its carlike height means there’s no clambering up to get inside, while its carlike driving manners make it corner and steer a lot sharper than most minivans or crossovers. The optional EcoBoost V6 scoots the delightfully substantial package with authority, plus there’s almost no fuel economy penalty compared with the base V6, although you have to watch the bottom line, as EcoBoost-equipped models can get pricey.

True to Mazda’s reputation for making great vehicles that often are overshadowed by the fare from larger competitors, the Mazda CX-9 is one of the most satisfying three-row crossover SUVs you can buy at a price that is comfortably below $34,000, yet it goes widely unappreciated. When it comes to driving, the Mazda CX-9 puts the

Mazda CX-5

Ford Flex

Mazda CX-9 CONTINUES ON PAGE 40

2014 January, SweetcrudeReports

Motoring

40

2014 SUV Buying Guide What you should know CONTINUED FROM PAGE 39 sport in sport-utility, and this makes it a favorite with us. Tool out to the mall in the CX-9 and you’ll be astonished at how nimbly a sevenpassenger crossover can drive. Exterior styling is clean and understated, while the interior is filled with convenience features, trimmed with uncommonly nice materials and assembled to a visibly high standard. Buying Mazda’s CX-9 proves the wisdom of zigging while the rest of the world zags.

Hauling plenty of people or gear without fuss is the strong suit of the GMC Acadia , which takes a detour from the brand’s ruggedtruck image to put the emphasis on comfort and refinement. As many as eight occupants can travel in the Acadia, while optional allwheel drive can see you through inclement conditions. But the Acadia is one of our top choices mainly because of its blend of versatility and premium attributes — dirty it up towing muddy offroad motorcycles on Saturday and yet the Acadia cleans up well enough to merit out-front parking at a fancy restaurant later that evening. The GMC Acadia is the new interpretation of the classic American car.

GMC Acadia

Top Recommended 2013 Ford Flex 2012 Mazda CX-9 2013 GMC Acadia

SUVs Under $40,000 Opulent but not ostentatious, the Audi Q5 is responsibly dimensioned, has a high-quality interior and is packed with performance and utility that exceed its modest footprint. As you might expect from its European provenance, the Q5 emphasizes agile handling and confident high-speed cruising. You can choose from a wide range of powertrains that offer different combinations of performance and efficiency, encompassed by a thrifty-but-thrusty turbocharged 2.0-liter four-cylinder, a heavenly supercharged V6 or even a hybrid. Meanwhile, Audi’s customary all-wheel-drive system is standard, but things start to get expensive once you get to the hybrid.

The Swedish aesthetic is in full force with the Volvo XC60 , a crossover that demonstrates how hip “sensible” can be. The XC60’s styling intrigues from all angles with its austere Scandinavian coolness, while the well-trimmed interior is deceptively spacious, not to mention refreshing in its lack of buttons. Meanwhile, the XC60 sublimates Volvo’s wonky, safety-first legacy with an emphasis on driving dynamics, particularly from the turbocharged T6 models. It’s a $6,000 jump from the base model to the T6 in order to get all-wheel drive, so check out the front-drive XC60 if you like what the XC60 says but don’t necessarily need all-weather traction.

The first generation of the BMW X3 crossover wasn’t one of the company’s better efforts, but all that’s changed now and the X3 is one of our top choices for an entry-luxury crossover. The new turbocharged four-cylinder engine is a performance marvel and is uncommonly frugal, while the 300-horsepower inline-6 helps deliver BMW nirvana in a crossover wrapper. The X3’s interior is lusciously styled and trimmed, while even the base model BMW X3 offers an unusual amount of standard content, including all-wheel drive and an engine stop-start system that enhances fuel efficiency.

Audi Q5

Volvo XC60

Top Recommended 2013 Audi Q5 2013 Volvo XC60 2013 BMW X3

BMW X3

SUVs Under $55,000 No matter which version of the Porsche Cayenne you select, it’s no subtle cruise-around-the-block proposition. Yes, the Cayenne makes a magnificent statement. Yes, you can spend as much as you want on a Cayenne, but at well less than our $55,000 price point, even the base Cayenne has a stunningly designed interior, standard all-wheel drive and some of the most muscular sheet metal in the crossover kingdom. At a smidge more than $55,000, the new Cayenne Diesel may be the thinking buyer’s choice, with performance that rivals the much pricier V8 variants and a 29 mpg

Porsche Cayenne

CONTINUED FROM PAGE 41

2014 January, SweetcrudeReports

Motoring

41

2014 SUV Buying Guide CONTINUED FROM PAGE 40 rating on the highway.

The choices in this class don’t get any more all-around solid than the Acura MDX . Whether it’s the MDX’s front-line array of high-tech electronic features, the ample performance from its 300-hp 3.7-liter V6 or the meticulous quality of its interior, the MDX simply doesn’t mess around. Mix in Acura’s reputation for unbeatable reliability and resale value and the MDX is a can’t-miss proposition — unless you want to save some bucks and examine its little brother, the RDX , which was totally redesigned for 2013 and with 273 horses ain’t no slouch, either.

“Cavernous” isn’t really accurate to describe the Infiniti JX35 , because a cavern also would need exquisite leather-trimmed walls and enough high-tech firepower to please a midlife-crisis Batman.

The JX35 is genuinely huge inside, including its rearmost row of seats, which can handle adults (at least for a while) and is accessed via a clever new seat-tilt design that allows child seats strapped in the second row to remain in place. Infiniti’s got an arsenal of available electronic features for the JX, including a system that will stop the JX completely before you reverse into something unseen. A poised highway ride and a hushed interior complement these impressions, although the V6 engine is still pretty thirsty despite the efficiency offered by the powertrain’s continuously variable transmission (CVT).

Acura MDX

Top Recommended 2013 Porsche Cayenne 2013 Acura MDX 2013 Infiniti JX35

SUVs Over $55,000 Like your mom said, it’s what’s on the inside that counts, so consider the Infiniti QX56 for your next luxury SUV. No longer built from a pickup truck platform, the new seven- or eight-passenger QX56 impresses with a combination of old-world comfort and modern technology. A seven-speed transmission routes power from a powerful 5.6-liter V8 to either rear- or four-wheel drive, so crosscountry trips feel effortless. Properly equipped, the QX is also capable of towing up to 8,500 pounds and features a tow/haul mode for the transmission as well as an automatic-leveling rear suspension. Criticisms are few, but a tight third-row seat and an exceptional fuel thirst should be noted.

Similarly well-outfitted for well-funded, large, active families in inclement climes, the seven-passenger, all-wheel-drive MercedesBenz GL-Class fulfills its mission with a range of powertrains from which to select. Either the 4.7-liter V8 or 5.4-liter V8 will blast this full-size SUV to 60 mph in less than 7 seconds, while the 3.0-liter turbodiesel V6 has a cruising range of about 600 miles and can tow up to 7,500 pounds. This is a full-size SUV done in the Mercedes-Benz style, completely sophisticated and refined, like an S-Class sedan in a sport-utility suit. It might be an SUV, yet it makes every drive an occasion.

Finally, if either Rodeo Drive or the Rubicon Trail beckons, there are few tools as posh or as well equipped for the job as the aptly named Land Rover Range Rover . With its impeccable 40-year pedigree of off-road prowess and a choice of two powerful V8 engines, the aluminum-intensive Range Rover sheds some 700 pounds this year in an effort to improve its traditionally poor fuel economy. It will continue, however, to indulge up to five passengers thanks to an entirely redesigned interior that’s one of the most opulent extant, boasting a 1,700-watt, 29-speaker audio system, front seats that can move in 20 different directions while massaging your buttocks in five different ways, optional LED ambient mood lighting, and a heated windshield. All this and go-anywhere mobility besides, from snowy wilderness cabin to fashionable downtown restaurant.

Infiniti Jx35

Infiniti QX

Mercedes-Benz GL-Class

Top Recommended 2012 Infiniti QX 2013 Mercedes-Benz GL-Class 2013 Land Rover Range Rover

Land Rover Range Rover

Technology

2014 January, SweetcrudeReports

42

How Utility Electrical Distribution Networks can Save Energy in the Smart Grid Era MICHEL CLEMENCE, RENZO COCCIONI, AND ALAIN GLATIGNY Executive summary Annual electricity distribution losses average 4% in the European Union.

These losses represent 7 billion Euros in annual waste. New regulations are forcing electrical distributors to enhance efficiency across their networks. Network operators are also challenged to integrate alternative energy generation and electric vehicles into their grids.

This paper offers a strategy for leveraging smart grid tools that will help meet and exceed regulatory efficiency targets.

measure, and improve transmission and distribution efficiency. Improvements can reduce operations cost by enabling the installation of equipment and software that communicates and integrates throughout the distribution path.

This paper explains how electrical distribution efficiency can be modernized to leverage the new promise of the “smart grid” while reducing distribution-related losses and associated costs (see Figure 1)2.

Ramifications of the European Union’s Energy Efficiency Directive are discussed, and best practices for deploying energy efficiency solutions are reviewed.

measures that reduce thermal losses, and by using low consumption equipment.

Examples of passive energy efficiency measures include the replacement of old transformers with lower loss amorphous distribution transformers, or the replacement of traditional lighting with low energy lighting.

T e c hni c al losse s a re physical losses that include load losses (copper or Joule effect) and no load losses (Corona losses, iron losses in transformers).

Non-technical losses are commercial losses which consist of delivered and consumed energy that

Introduction 1aInternational Energy Agency (IEA Statistics © O E C D / I E A , http://www.iea.org/stats/ind ex.asp), “Energy Statistics and Balances of Non-OECD Countries and Energy Statistics of OECD Countries, and United Nations, Energy Statistics Yearbook” 1b Eurelectric: Power Statistics 2010, Full report, page 16 2Wolfram Heckmann, Lucas Hamann, Martin Braun, Heike Barth, Johannes Dasenbrock, Chenjie Ma, Thorsten Reiman, Alexander Schelder , “Detailed analysis of network losses in a million customer distribution grid with high penetration of distributed generation”, Cired paper 1478, June 2013 As a result of recently announced government mandates, Distribution System Operators (DSOs) will need to improve the efficiency (lower the loss rates) of their electrical distribution networks by 1.5 % each year. In addition, they are tasked with finding new ways to integrate smart grid drivers such as electric vehicle charging stations and alternative energy generation (wind, solar) at consumer locations.

Today it is both possible and prudent to plan,

Figure 1 Distribution losses vary depending upon network configuration.

In the domain of electrical efficiency, it is always helpful to define common terms so that confusion is avoided when concepts and best practices are discussed. Below are a few terms that are utilized in this white paper and the associated definitions:

Some terminology Active Energy Efficiency is the act of effecting permanent change in energy consumption reduction through measurement, monitoring, and control of energy usage. Examples of active energy efficiency include dynamic network reconfiguration and voltage optimization. (For more information on Active Energy Efficiency, see the Schneider Electric white paper entitled “Making Permanent Savings through Active Energy Efficiency”).

Passive Energy Efficiency is the act of reducing energy consumption by promoting

cannot be invoiced to an end user.

This category of losses can be split into fraudulent losses such as theft, or nonmetered public lightning and hidden losses such as the inh o u s e consumption of equipment in the

distribution network (e.g., the power needed to cool transformers and to run control systems).

Distributed energy resources (DER) include a variety of supply-side and demand-side resources such as distributed generators (renewable or back-up), controllable (or flexible) loads used for demandresponse, energy storage (electrical or thermal) and electric vehicles (which play a dual role of both load and energy storage).

31, 2020 (Article 7).

—Network tariffs will reflect network costsavings. These savings will be achieved through both demand-side and demandresponse measures and also through distributed generation. This will include savings from lowering the cost of delivery of electricity or gas through investments in the distribution network or from network operational process improvements (Article15).

—Concrete electrical efficiency measures and investments for improvements in network infrastructure will need to be identified by June 30, 2015 (Article 15).

—Tariffs will be set at a rate that will encourage suppliers to improve consumer participation in system efficiency, including demand-response practices (Article 15).

The following sections provide examples of best practices that can help Distribution System Operators cut costs and accommodate the above regulations. 

Active energy strategies for loss control Issue 1: Technical losses in MV lines In Europe networks are configured in open loops and

controlled in order to be able to isolate a fault and restore power (see Figure 2). The normal open points of the loops are strategically located to maximize the quality of service, i.e., low interruption duration (SAIDI) and low interruption frequency (SAIFI). However this strategy does not minimise losses.

Strategy: Advanced Distribution Management Systems Systems built to estimate losses, like Advanced Distribution Management Systems (ADMS), need a real-time network topology, network measurements, load profiles at MV and LV substations, and customer consumption information in order to determine the optimal location of normal open points. In this environment, when the system operator plans to open or close a switchdisconnector, the ADMS simulates the impact on reliability of supply, losses, and voltage management.

Algorithms calculate optimum configurations on an hourly, monthly, seasonal, or yearly basis according to provided load curves, weather forecast, real-time data coming from sensors, smart meters, and number of switch operations (see Figure 3). Network simulationSCADAState e s t i m a t o r V o l t VarcontrolNetwork a n a l y s i s L o a d forecastingReal time

Regulatory challenges The European Energy Efficiency Directive 2012/27/EU, as it applies to Distribution System Operators, can be summarized as follows:

—Member states will enforce energy efficiency obligation target savings of 1.5% each year for the time period ranging from January 1, 2014 through to December

Figure 2 Diagram of a network configured in open loops and controlled in order to isolate a fault and restore power

CONTINUES ON PAGE 43

2014 January, SweetcrudeReports

Technology

43

How Utility Electrical Distribution Networks can Save Energy in the Smart Grid Era CONTINUED FROM PAGE 42

lifetime of the device. Hourly c o m m u n i c a t i o n reconfiguration would require b u s S u b s t a t i o n r e m o t e 200.000 operations during the terminal unitsSubstation lifetime of the device.)

—Losses can be reduced automationADMSFault 2 0% on a weekly managment… reconfiguratio n basis (i.e., 50 times a year) —Losses can be reduced to 10% on a seasonal reconfiguratio n basis (i.e., 4 times a year) —Losses can Figure 3 be reduce to Simulation and testing is an effective method for 4% in case of reducing network energy losses Optimal locations of normal open points in a distribution grid (power flow) depend on the actual power demand in the grid (consumption). Power demand fluctuates throughout any given day and will also change with the different seasons. These load changes impact the optimal locations of normal open points. It is therefore necessary to use a grid reconfiguration application for testing multiple grid states and to deploy a solution capable of identifying the optimal locations of normal open switches. The proper radial distribution grid configuration will be achieved in accordance with pre-selected criteria and objectives.

Deployment of such a system can help minimize losses, minimize load unbalance in HV / MV substation transformers and feeders, unload overloaded segments of a network, improve voltage quality and achieve an optimal voltage profile. However, the system can also be constrained by an infrastructure that limits the feasibility of switching operations and with infrastructure voltage and loading limits.

Field pilot projects of such systems have yielded some interesting results: —Losses may be reduced up to 40% in case of an hourly reconfiguration (However, this is not realistic in terms of the number of operations.

Switch-disconnector equipment is designed to respond to actual needs, such as 1.000 operations per

yearly reconfiguration Issue 2: Impact of DER on voltage management One of the main responsibilities of utilities around the world is to maintain voltage limits as agreed to via contract with their customers (i.e., within +/10% of agreed to target).

Voltage control is traditionally performed by transformers, using on load tap changers and capacitor banks that inject reactive power into the grid at the HV / MV sub-station level.

The Distribution System Operator (DSO) fixes a setpoint and prepares scenarios and ranges based on seasonal load curves, for example.

As a result of the massive injection of Distributed Energy Resources (DER) requirements onto the grid, voltage management now presents DSO’s with a major challenge. They now have to manage situations where voltage may be rising on one part of their grid while decreasing on another part.

Thus, DSOs are deploying sensors to monitor the voltage

As a result of the massive injection of Distributed Energy Resources (DER) requirements onto the grid, voltage management now presents DSO’s with a major challenge

all along feeders, new actuators that are able to regulate the voltage at different levels, and centralised or distributed intelligence to manage the macro voltage control.

Strategy: Fine tuned voltage control infrastructure The monitoring of MV equipment in older substations is costly as it requires complex, intrusive methods. Thus, the ability to acquire accurate, “real time” voltage measurements implies the deployment of new solutions and sensors to minimize long term global costs.

A number of new solutions can be deployed to address this challenge. New capacitive or resistive voltage divisors can be inserted in cable connections at the transformer or Ring Main Unit (RMU) level.

Another option is to utilize “virtual sensors” capable of estimating or modeling the MV voltage based on other data that is easier and cheaper to measure. For instance MV voltage may be estimated from LV through distribution transformers or from load currents through lines impedance modeling.

Depending on the level of accuracy required, sensor and installation costs can be drastically reduced.

Actuators, which are most often installed at the HV / MV substation level (on load tap changers within HV / MV transformers, capacitor banks and voltage regulators), can also be installed along MV lines or even further downstream.

These new actuators are installed in smart transformers with up to 9 taps. The transformers can use MV voltage to increase or decrease the LV voltage.

They are actuated by contactors with an operation durability of more than 1 million operations. No maintenance is required.

Reactive energy injectors can also be utilized at the distributed generation (DG) level through insertion of dedicated devices or by using DG controllable inverters.

In the above two cases, the actuators must be managed together by new algorithms installed locally in primary or secondary substations

Figure 4 Voltage control aided by algorithms can help manage changes being brought about by increased presence of distributed energy resources (DER)

and / or centralized in the ADMS at the control centre level (see Figure 4). This downstream voltage regulation must be coordinated with the legacy regulation at HV / MV substations through the ADMS system.

This fine tuned voltage control infrastructure designed for DER integration can also be used to minimise technical losses.

On a heavily-loaded network it can be used to operate at maximum voltage to reduce current flow at equivalent power and therefore reduce Joules losses along cables and transformers. Or it can be operated at minimum voltage on a lightly loaded network to minimize iron losses in transformers. It can also be used to minimize load peaks thereby reducing the need to use costly, high carbon footprint energy resources.

T h e s e v o l t a g e management solutions have been tested in several pilot projects in Europe. DER integration on distribution networks can result in: —Drastic reduction of PV disconnection —Technical losses reduction in MV lines —Reduction of load peak Issue 3: Technical losses in LV lines

Technical losses on MV n e t w o r k s represent about 3% of the distributed energy. Joules losses represent 70% of these losses3 (but this is dependent upon the load rating of the network).

3 Dr. Georgios Papaefthymiou,

Christina Beestermöller, Ann Gardiner, “Ecofys Incentives to improve energy efficiency in EU Grids”, 15 April 2013 More losses occur in the LV network. The LV ends of distribution networks are often heavily unbalanced between transformers (transformer to transformer), between LV feeders within a transformer, and between the three phases of one given transformer. These imbalances cause joules losses in wires and transformers due to higher current level on the more loaded part of the network and to current flow in neutral wires. These losses are estimated to be between 200 and 1.000 Euros per substation per year.

Strategy: Detailed analysis of MV / LV level performance data The daily load, voltage, power factor, and the temperature profiles of the substation and feeders are examples of data that can be gathered by the monitoring system. A chronological overview of events can be determined, such as the voltage duration curve, load duration curve per feeder, vector diagram for the diagnosis of unbalances per feeder and other values.

These data points can then be formatted into customizable dashboards. In order to reduce the data volume that is transmitted from substation to the distribution management system (DMS), the curves can be calculated by local remote terminal unit (RTU). This practice helps to avoid communication congestion (see Figure 5).

Figure 5: Data gathered from remote terminal units (RTU) can feed dashboards visible from the control center or from other remote locations.

Community

2014 January, SweetcrudeReports

44

SNEPCO takes Corporate Social Responsibility to Old Citizens Aged woman

S

hell Nigeria Exploration and Production C o m p a n y , SNEPCO, a subsidiary of the Shell Petroleum Development Company of Nigeria, held its

end-of-year party at the Old People’s Home in Yaba, Lagos, during which it also inaugurated part of the home which it renovated.

SNEPCO had last year donated a 30KVA generator for the home as part of its

corporate social responsibility.

“We are pleased to identify with children with special needs and senior citizens as part of our social investments portfolio which cuts across health,

education and social services. Just recently, SNEPCO identified with children with special needs at Modupe Cole Memorial Childcare, Lagos by expanding and equipping a physiotherapy unit.

Govt set for clean up of Ogoniland —Ministry I

f all goes according to plan, the Federal Government would soon commence the clean up of the oil-spill devastated areas in Ogoniland.

This is in line with the recommendations of the U n i t e d N a t i o n s Environmental Programme, UNEP, which reported vast degradation of Ogoniland by oil companies.

The Ministry of Petroleum Resources would be executing the clean up through its Hydrocarbon Pollution Restoration Project, HYPREP, established for that purpose.

In announcing the planned commencement of the clean up in a statement in Abuja,

the ministry said project officials charged with the responsibility have already met stakeholders in Ogoniland, including members of the Ogoni Supreme Council of Traditional Rulers.

Also, the ministry has embarked on eight emergency measures with material and logistic support from the Bayelsa State Government as well as some local governments councils and corporate organisations, listing the measures so far embarked on to include mounting of advocacy signage, provision of drinking water tanks across Ogoniland, development of a medical

registry, sourcing of water testing and air pollution facilities and conclusion of clean up work plan and formation of work groups.

According to the ministry, the measures also included donation of lands for Centre of Excellence for Environmental Restoration and the Proposed Integrated Soil Management Centre, ISMC, gathering of commercial and technical information for the detailed design of the clean-up plan and a socio-economic study for the development of a livelihood strategy for Ogoniland.

It also said emergency call centres had been created as

it also announced ongoing discussions with the Johns Hopkins University on epidemiological studies, development of curriculum on environmental hazards, public awareness to highlight the dangers of artisanal refining activities and crude oil theft.

It further disclosed in the statement that the restoration project had been repositioned while the technical working groups had been created in line with recommendations of UNEP.

"And as it is being done here today, we were in Modupe Cole last year for the end of the year party,” the company's managing director, My Chike Onyejekwe, said during the end-of-year party.

According to Onyejekwe, six rooms were renovated by the company in order to create a more conducive living environment for the old people and to accommodate more inmates.

The managing director, who disclosed that SNEPCO has so far constructed 28 ICT centres in various secondary schools across the country, further revealed that the company would be providing the Old People's home with alternative electricity source by way of equipping the renovated rooms with inverters.

“We are working to deploy Health Straightening system (HSS) at hospitals at Iyi Enu (Anambra State), Ogijo (Ogun State) and Lapai community (Niger State. The HSS will help to improve service delivery, manpower, knowledge management, procurement, financial management and development of physical infrastructure,” he added.

2014 January, SweetcrudeReports

Community

45

Group tasks Shell on clean up of Ikararama Community

T

h e Environmental R i g h t s Action/Friends of The Earth Nigeria, ERA/FoEN, has urged Shell to clean up oil spill sites within its oil field in Ikararama community in Yenagoa, Bayelsa.

E R A / F o E N , a n environmental rightsfocused Non-Governmental Organisation, NGO, criticised the slow response of Shell to an oil spill incident, which occurred in Ikarama on November 2.

An oil spill from Rumuekpe crude delivery line operated

by Shell had discharged some 482 barrels of Shell’s Bonny Medium crude stream into the environment at Ikarama community.

Mr Alagoa Morris, Head of Field Operations at ERA/FoEN’s Bayelsa office, said the oil firm had yet to commence crude recovery and clean up of the contaminated site.

He said that the development had led to continued exposure of the community's residents and the environment to the toxic effects of crude oil since Nov. 2.

However, Shell in a report on its website, claimed that it commenced the recovery of the spilled oil on Nov. 12 and that the clean up of the spill site would be completed in April 2014. Checks at Ikarama recently showed that the clean up had yet to commence.

Morris said that field reports from ERA/FoEN’s environmental monitors showed that the spilled crude had been spreading and causing further degradation to the environment. ''Field monitors of the Environmental Rights Action/Friends of the Earth Nigeria (ERA/FoEN) visited Ikarama community on the 11th of November, 2013 to investigate an oil spill which community folks said occurred on the 2nd of November, 2013. ''As a follow up, ERA/FoEN visited again on the 17th of December, 2013 with a view to ascertaining the state of the immediate environment,

Oil spill

especially as to whether Shell has mopped up the spill. ''The spill was noticed to have spread over a 100 metres by length and, over 20 metres by width. During ERA/FoEN’s first visit, due to the vegetation cover it was not possible to properly observe the spread.

Field reports from ERA/FoEN’s environment al monitors showed that the spilled crude had been spreading and causing further degradation to the environment

''Economic trees such as palm trees and other crops like plantain and sugarcane were observed within the site polluted by crude oil," he said.

According to him, the NGO had, in its field report, demanded the immediate commencement of clean up

activities to forestall further damages to the ecosystem.

It challenged the oil firm to take steps to protect its facilities from vandals who often caused damages to the environment and residents.

ERA/FoEN also urged the oil communities to guard against vandalism and

report anyone found culpable in the act.

When contacted, Mr Precious Okolobo, Shell Spokesman, declined to speak on the perceived slow response of the oil firm to the spill in the community.

Delta commissioner advocates true federalism, 50% derivation

A

commissioner on the board of the Delta State Oil Producing Areas Development Commission, DESOPADEC, Chief Ominimini Obiuwevbi, says the absence of true federalism was denying oil producing communities of due development as he called for 50 per cent derivation in the sharing of national income.

Obiuwevbi, who represents Ethiope East and Ughelli North Local

Government Areas on the DESOPADEC board, said the current 13 per cent derivation fund for oil producing states was inadequate and should therefore be raised to 50 per cent.

He said in Ughelli at an event to mark his one year in office that the inability of the state body to implement some useful policies was caused mainly by the absence of true federalism in the country.

The commissioner

maintained that DESOPADEC was committed to the development of the oil bearing communities in the state and that it would continue to execute only people-oriented projects.

According to him, most of the projects he met following his appointment had been c o m p l e t e d a n d commissioned, while others “are speedily ongoing.”

2014 January, SweetcrudeReports

Community

46

Empowered woman in her store

M

inister of t h e Federal Capital Territory, FCT, Sen. Bala Mohammed, says 1,000 women would be empowered under the FCT Administration SURE-P programme.

Mohammed disclosed this to the National Council of Women’s Societies, NCWS, during the council's Peace Initiative and Conferment of 2013 Pillar of Achievements award.

The minister, who said the empowerment of women would bring development to FCT and the country at large, noted that women were tools for change that could bring p eace advocacy to the country and its leadership.

“Women are trustworthy, hardworking and reliable when given any opportunity to hold any office; they are peace advocators that must be given more chances in government,’’ he said.

The minister promised that the original Gbagi indigenes would not be neglected as the Land Swap programme ini t i a t e d b y hi s administration had come to stay.

“The rights, resettlement and compensation of the original Gbagi Indigenes will be given to them; and they will be well protected,” he said.

The minister, who was honored with pillar of achievement award by the NCWS, said that his administration would continue to promote peace and development in the FCT.

1,000 women to be empowered under FCTA SURE-P Wife the FCT Minister, Hajia Aisha Mohammed, said that women were agents of peace and should not be neglected in the society.

Mohammed urged women to nurture their children with the fear of God, adding that the future of the country was in their hands.

The President, the National

Council of Women’s Societies, FCT Council, Mrs Nancy Bulus said that the minister was honoured for giving women their rightful place in the FCT. She reminded the minister of its request for the building of NCWS, FCT Secretariat Complex and the 15 hectares of land for the building of

NCWS Housing Scheme.

Of the 12 awards given by the society, seven were awarded to women, including the FCT Minister of State, Ms Olajumoke Akinjide. Hajia Jamilah Tangaza, Executive Director of AGIS and Late Chief Jumai Aduda were also among the recipients.

Community threatens oil firm over job exclusion

R

e s i d e n t s o f Garseqoftu location in Kenya's Wajir county are threatening to stop oil exploration in the area over alleged exclusion in jobs, tenders and hire of vehicles.

The locals accused Africa Oil Kenya, AOK, which is involved in oil exploration, of colluding with the Wajir county government to sideline them.

In various protest letters endorsed by more than 50 community elders, the locals say they have no faith in the county government.

They called on the national government to intervene and resolve the issue before it degenerates into violence.

“We are not against the exploration because if oil is

discovered, it will benefit our county and the country in general. But we will not agree to be sidelined,” one letter read.

Community spokesman Abdikadir Mohammed said AOK has not honoured an agreement that 80 per cent of all procured services will go to the residents of Garseqoftu.

Mohammed said the community is being locked out by the county government for allegedly not voting for it during the March 4 general election.

“We don’t understand how the community can be sidelined yet it is the one that will suffer in case there are environmental and

health implications for the explorations,” he said.

“The community holds the key to the explorations. If it

Oil workers

says no because of being sidelined, AOK can as well pack and leave to prevent violence.”

2014 January, SweetcrudeReports

47

118,912 benefit from SURE-P —Wogu

A

bout 118,912 Nigerians have so far benefitted f ro m t he Community Services Women and Youths Employment Project, CSWYE, of the Subsidy Re-Investment and Empowerment Programme, SURE-P, in the 36 states of the federation and the Federal Capital Territory.

According to Minister of Labour and Productivity, Chief Emeka Wogu, the CSWYE is a project that should be adequately supported and sustained because it has direct bearing on the poor and vulnerable in the country.

“The volume of work done by the beneficiaries of CSWYE so far in all the states of the federation translated to a total of 160,548,400 man-hours, with environmental sanitation accounting for the highest value of 110,776,900 man-hours and traffic control the lowest, with a total of 3,817,300 man-hours output," Nwogu said at a meeting with the Senate Ad Hoc Committee on SURE-P. Nwogu stated that of the 118,912 beneficiaries, 75,823 were males, 43,089 females and 5,122 physically challenged persons, stating that the beneficiaries were spread in 8,864 service points in 11,139 communities of 8,993 wards across the 774

local government councils in the country.

Referring to the CSWYE project as a promise kept by the Goodluck Jonathan administration, he said that hallmark of the project was the transparency and accountability associated with it.

Chairman of the Senate Ad Hoc Committee on SURE-P, Senator Abdul Ningi, in his contribution, commended the minister for his transparent presentation, maintaining that the CSWYE was a project that should be supported and

sustained because of its direct bearing on the poor and vulnerable citizens of the country.

He said: “For us as a Senate and a Committee, we view this particular programme as very cardinal and very important to the wellbeing of the citizens of this Country. We believe if properly implemented, Community Services Women and Youths Employment Project of SURE-P will be a catalyst for development”.

Wogu

Kenya: Tullow seeks close ties with host communities

F

ew days after UK firm, Tullow Oil, was forced to suspend operations in Turkana in Kenya after locals stormed some fields demanding for employment, the company has sought specialists to help it forge a closer link with the locals.

Tullow, which has since resumed operations after signing a return-to-work m e m o r a n d u m o f understanding, MoU, with local leaders last month, has advertised for six positions of community communications coordinators.

These officers will serve as a focal point between the community and Tullow and will be required to provide an interface between Tullow and the community. Under the MoU, Tullow was supposed to have opened field information and liaison offices in Lokichar and Lodwar by December 31.

According to the job advert, two of the community coordinators will be based at Lokori, two at Lodwar and two at Lokichar. The officers will also be in charge of managing the day to day operations of the local community resource office. They will also facilitate

access to relevant information, responding to and document questions and issues raised by the community.

The company is also looking for a supplier development advisor who will among others assist new local suppliers achieve Tullow’s performance standards. During the demonstrations, locals demanded that they be given opportunities to supply good and services to the company and this post aims to address this issue.

E-mail: johniyene@yahoo.com

OBASANJO: Last fight against the obscurity of retirement

O

basanjo was a Nigerian soldier who became a Nigerian statesman, an African spokesperson and a world figure. In October 1979 he handed power to the civilian government of Shehu Shagari and became an instant hero of democrats all over the world.

Many have argued and his “body language” during his “second coming” has been read by many to suggest that he handed over power in 1979 more for fear of receiving the “Murtala Mohammed treatment” than for the love of democracy.

As a member of the Commonwealth Eminent Persons’ Group, Obasanjo wrote a letter to British Prime Minister, Mrs. Margaret Thatcher in which he thoroughly criticised her for her position against the placement of sanctions against P. W. Botha’s Apartheid regime in South Africa. For an African statesman, he stirred controversy by his statements and writings against the tradition of other statesmen before and during his time. After he handed over power to his former deputy, Madiba Nelson Mandela retreated from the spotlight in favour of the rulers of the day until he passed on. Julius Nyerere, Kenneth Kaunda and the maverick Ghanaian Air Force officer and former head of state, John Rawlings all kept that tradition in the same manner as our own Nnamdi Azikiwe, Shehu Shagari and Ernest Shonekan, quietly watching their successors with the optimism of sages and the practical expectation of wise men “who had worn the shoes.”

The earliest indications that Obasanjo would not welcome the relative obscurity of retirement came to the limelight when he edged off Chief Tony Anenih and assumed the office of Chairman of the Board of Trustees of the PDP in 2007. Examining his activities through the lenses of history one would find that this is a man who decided that even if he lost political relevance and societal limelight, he would not himself, let go of the limelight! To actualise his dreams, he wrote controversial biographies in which he gave himself credit for events that occurred without his participation; he formed a high profile democratic institution, the African Round Table, although he was himself bereft of democratic credentials apart from his fear-induced hand over of political power in 1979. You may recall that he deployed that platform to criticise the government of Gen. Ibrahim Babangida whose SAP policy he famously described as “lacking the milk of human kindness.”

Again for his meddlesomeness he was thrown into jail by the military government of Gen. Sani Abacha. While languishing in Abacha’s prisons, Obasanjo wrote a letter of condolence to the head of state when the latter lost his first son, Mohammed Abacha in a plane crash. Although this letter stirred no political controversy, it was regarded in intellectual circles as a shameless plea for leniency couched in the prose of condolence!

On the 13th of December 2013 Olusegun Obasanjo sprang out from his Ota Farm abode where only the cackle of the birds he rears, constitute his daily briefings. In his usual arrogance and tactlessness, he published an 18 paragraph letter he wrote to Nigeria’s president and commander-in-chief, Goodluck Jonathan.

Commenting on the letter, the African Herald stated: “Obasanjo has passed his shelf life in Nigerian politics.”

In an article published by the Punch on December 29, 2013, one Chido Onumah wrote: “Obasanjo has outlived his usefulness, if anyone ever found him useful.”

In our humble opinion, this is Obasanjo’s last effort at fighting the redundancy pressed on him by younger political hawks in the PDP and on the country’s political centre-stage where the combatants are the young and vibrant president and his team of young advisers against the equally young but misguided governors, who like Obasanjo would soon be characterised by the disappearance of their political shadows!

2014 January, SweetcrudeReports

48