January edition by Sweetcrude reports

DPR to commence recovery of idle marginal fields in March P/10

Transition Electricity Market to take off February 1

P/18

A Review Of The Nigerian Energy Industry January, 2015

VOL 02 N0. 22

www.sweetcrudereports.com

U P DAT E S MONTHLY BASKET PRICE JAN-15 DEC-14 NOV-14 OCT-14 SEP-14 AUG-14 JUL-14 JUN-14 MAY-14 APR-14 MAR-14 FEB-14 JAN-14 Daily | Weekly | Monthly | Yearly

47.59 59.46 75.57 85.06 95.98 100.75 105.61 107.89 105.44 104.27 104.15 105.38 104.71

45.74 U$

108 106 104 102 100 98 96 94 92 90 88 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Dec-15

Shell: Okunbor steps in as Sunmonu retires

ong-time country head of Shell Nigeria, Mr. Mutiu Sunmonu, is retiring from the company and Mr. Osagie Okunbor will become managing director of Shell Petroleum Development Company of Nigeria, SPDC, from March 1. Okunbor, currently senior advisor for Shellâ&#x20AC;&#x2122;s upstream international operations business in The Hague, has more than 28 years of experience in the industry. He has formerly been vice president of human resources at Shell upstreamâ&#x20AC;&#x2122;s subSaharan Africa division, as well as vice president of infrastructure & logistics at Shell Nigeria.country chair in January 2010.

Nigeria caught in the throes of oil price volatility Economic hardship looms in 2015 Local refining, way out of problem Fuel prices still high, marketers' greed fingered

Nigeria Content Investment Forum

Where prospects meet opportunities

Houston, Texas, May 4, 2015 For far too long oil & gas enthusiasts from Sub Saharan Africa, especially Nigeria visit the USA in search of technical partners, products and services. Most of them go back empty handed. We seek to change all of that. Enquiries: tukur70@sweetcrudereports.com, yemie@sweetcrudereports.com Powered by

Contents

2015 January, SweetcrudeReports

Editor’s note

e welcome you to 2015, and it is our utmost wish that the new year fills your heart and your home with love, joy and laughter. Unfortunately, Nigeria, from all indications, appears in for a difficult year. The current fall in oil prices, well below the nation's oil benchmark price of $65 per barrel for the 2015 budget, means Nigeria would be operating on a deficit budget, and with this will come the kind of hardship the nation may not have anticipated. Already there are talks of austerity, gloom, hard times, expenditure cut-back, retrenchment or mass sack and the rest of them. What's the way out of this scenario? Can the nation's foreign reserves which has now climbed to $34.49 billion, going by the Central Bank of Nigeria's latest account steer the country out of trouble? Economic analysts and industry experts we spoke with in the process of producing this edition of your favourite newspaper proffer solutions to the problem. To cushion the effect of last year's devaluation of the naira, the Trade Union Congress says it would be demanding for wage increase for workers this year. A very laudable move, but it is left to be seen how the government

4 7 13 15 18 24 29 32 34 38 40 43

would address this expected demand in the face of dwindling revenue and economic down-turn the situation in the international oil market presents. If you are involved in sea piracy or any other form of illegality within the Nigerian maritime domain, the Director General of the Nigerian Maritime Administration and Safety Agency, NIMASA, Ziakede Patrick Akpobolokemi, has news for you: 'We will come after you and we will get you', he says. The man who has been at the helm of affairs at the national maritime regulator in the last four years sounded so sure as he spoke to the media, including SweetcrudeReports, in Lagos. Now the good news: Shell Petroleum Development Company of Nigeria, SPDC, and Bodo Community in Rivers State have finally resolved their differences in respect of the two oil spills in the area in 2008. “From the outset, we’ve accepted responsibility for the two deeply regrettable operational spills in Bodo. We’ve always wanted to compensate the community fairly and we are pleased to have reached agreement,” said Mr. Mutiu Sunmonu, SPDC's managing director, as he announced a £55 million settlement agreement with the community over the oil spills. All these and more in this edition. Once again, we say, welcome to 2015.

COVER

Nigeria caught in the throes of oil price volatility

OIL

Oil Price Fall: Industry players seek survival strategies

FOCUS If you kidnap, we’ll come after you, Akpobolokemi warns sea pirates

GAS NLNG Vessels: Nigerian firms begin export of products to Korea

POWER

Transition Electricity Market to take off February 1

FINANCE World Bank to spend $1.7bn on Nigeria’s power sector

LABOUR

Stimulate local refineries in 2015, PENGASSAN tasks Govt

SOLID MINERAL

Transportation, major problem of Ajaokuta Steel -Minister

FREIGHT NIMASA targets 90% ISPS code compliance this year

MOTORING CAR AND DRIVER unveils the 10 Best Cars of 2015

TECHNOLOGY Oil shale economics

COMMUNITY Bayelsa govt reviews security policy to check oil theft

EDITOR-IN-CHIEF Hector IGBIKIOWUBO EDITOR Chuks ISIWU ASSISTANT EDITORS Yemie ADEOYE Ike AMOS Eluonye KOYEGWUAEHI

SNR. CORRESPONDENT Oscarline ONWUEMENYI Sam IKEOTUONYE

GM, Marketing Nkem IGBIKIOWUBO

+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

2015 January, SweetcrudeReports

Cover Story

2015 January, SweetcrudeReports

Nigeria caught in the throes of oil price volatility CHUKS ISIWU, OSCARLINE ONWUEMENYI & MKPOIKANA UDOMA

lobal oil prices have been in steep decline since June 2014 as a result of slow demand growth and a number of other factors, among them the slowdown in the global economy, from China to the European Union; an overproduction of oil, with the United States producing more energy from shale oil deposits; and the Organisation of the Petroleum Exporting Countries, OPEC, holding its output steady, even as prices drop. Just last week, the global oil benchmark, Brent, against which Nigerian oil is priced, tumbled below $50 per barrel, its lowest level since May 2009. How far will oil prices fall? Nobody seems to know. Indeed, the decline in global oil prices has meant good news for car-driving consumers in mostly Western countries who are now paying less at the pump - on average, petrol is about $2 a gallon for consumers in the United States, marking the lowest prices in over four years. Reports further show that the global oil slump is also good for businesses, as consumers may suddenly have more money to spend. But, the news isn't all cheery, especially for millions of ordinary Nigerians who have been told by their government to tighten their belts for the rough patch ahead due to the global slump in oil prices. Also, for many small businesses in the country, the falling price of oil adds new risks and concerns, forcing them into some sort of precarious balancing act. The question, however, has been asked: how exactly are Nigerians being impacted by the global collapse in oil prices? Also, why are millions of Nigerians not feeling the global oil slump in their pocketbooks? Why, in a situation where pump price of petroleum products is at its lowest in recent history in other climes, are Nigerians made to pay more for the product, oftentimes after queuing for several hours? Many analysts who spoke to our correspondents blamed this on greed and avarice of petroleum product importers, stressing that the system has been rigged to always serve the interest of the

Crude oil flowline oil companies against the citizens. Others blame inefficiency and corruption of the regulatory system, as well as mismanagement of the subsidy process for the current state of affairs. G l o o m , c o n c e r n everywhere Stakeholders in both the private and public sectors, who spoke to our correspondents, painted a gloomy picture of the economy and the prospects of workers in the new year. They based their projections on recent happenings in the Nigerian and global economies. This gloomy picture is in addition to the political tension, corruption and insecurity already plaguing the nation. In the oil sector, experts are of the firm belief that the current development would cause a reordering of priorities, adoption of new operating strategies, a c u t b a c k on expenditures, deferment of projects, loss of jobs and project flights, considering Nigeria's inclement operating environment and high cost of doing business, when compared to those of neighbouring oil producing countries. Some analysts, including Engr.

Many analysts who spoke to our correspondents blamed this on greed and avarice of petroleum product importers, stressing that the system has been rigged to always serve the interest of the oil companies against the citizens Emeka Ene, the chairman of the Petroleum Technology Association of Nigeria, PETAN, say players should look inward and tap indigenous human and capital resources that would drive full industrial operations in the sector. In both public and private sectors, there are strong indications that workers are faced with mass retrenchment. Presently, reports indicate that at least 70,000 civil servants in 30 ministries, departments and agencies of the Federal Government had yet to receive up to three months salaries. While the Federal Government is believed to owe workers of the Ministry of Labour and

Productivity salary arrears ranging from one to three months, 11 state governments could not pay December salary to workers. Three of the states – Benue, Plateau and Osun – have been reported to owe workers three months’ salary arrears. In separate interviews with SweetcrudeReports, stakeholders expressed fears that companies and public institutions were planning to address the downturn in the economy with cost-cutting measures and downsizing. Recently, the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, gave indications to this effect when it raised the

alarm that companies, especially in the petroleum sector, had plans to retrench staff. According to the association, non-core employees of oil firms in the country may be asked to quit their jobs, if the fall in oil prices persists till April or May. According to the Media Officer of PENGASSAN, Mr. Babatunde Oke, employers had grown weary of the slump. “The effect might be severe if it continues till May because some employers are already complaining that they may need to shed weight, if it persists till then. Of course, it will affect contract staff, if the slump persists,” Oke noted. Similarly, the Deputy President, National Association of Small Medium Enterprises, Mr. Orimadegun Agboade, stated that retrenchment had already begun in some sectors. He said, “We closed for the year (2014) earlier than usual. Ordinarily, we take a break close to Christmas. But with the way things are right now, many companies closed two weeks before the normal closing date. Based on recent events, federal, state and local governments still owe salaries of up to threemonths. It is an indication that things are not right at all. In fact,

CONTINUES ON PAGE 5

Cover

2015 January, SweetcrudeReports

Modular refinery

Nigeria in the throes of oil price volatility CONTINUED FROM PAGE 4 many of us are afraid of what will happen.” Agboade stated that the current foreign exchange rate is the harbinger of the gale of retrenchments that would sweep workers out of the manufacturing sector. “For instance, I am a manufacturer of medicine; I received a notice from my bank two weeks ago that the Federal Government had placed an embargo on all letters of credit. The implication of this is that immediately we run out of the raw materials we have now, the hope of getting more will be slim, or it won’t come on time. “In the pharmaceutical industry, where I belong, close to 98 per cent of our raw materials are imported. A lot of companies are already cutting salaries,” Agboade added. The NASME Deputy President further said the scale of retrenchment could be as high as 25 per cent. He warned that if things were not sorted out quickly, it could reach 50 per cent. Similarly, the Chairman, National Association of Small Scale Industrialists, Lagos State chapter, Mr. Segun Kuti-George, said the fact that the foreign exchange rate was not in equilibrium with the naira was a sign that mass retrenchment might be closer than expected. “We have more naira chasing

fewer dollars now. Also, the monetary policy is moving from 12 per cent to 13 per cent higher interest rate. We now have a higher rate of exchange, which inherently means inflation. “It means that prices of imported and locally-made goods will go up, which would mean lower demand and, therefore, lesser profits for companies. This may then lead to layoffs,” he explained. The Director-General, Lagos Chamber of Commerce and Industry, Muda Yusuf, predicted that the year would be challenging for businesses, as the cost of production would increase, while purchasing power would decline. He explained that businesses would have to look at all possible options for survival, including cost reduction in other areas. The process of reducing costs, according to him, may result in cutting the number of employees. At the presentation of the 2015 budget to the National Assembly, the Minister of Finance and Coordinating Minister of the Economy, Dr. Ngozi Okonjo-Iweala, had announced more austerity measures. She had explained that the measures were aimed at cushioning the economic impact of the drop in oil prices. She added that the measures would be implemented from the beginning of the second quarter of 2015 to boost the ratio of nonoil revenues to oil revenues. The

The Director-General, Lagos Chamber of Commerce and Industry, Muda Yusuf, predicted that the year would be challenging for businesses, as the cost of production would increase, while purchasing power would decline

Federal Government’s 2015 budget estimates of about N4.3trillion was planned with a $65 oil price benchmark. Way out of the price quagmire The biggest question currently centres on how Nigeria could negotiate itself out of the oil price problem without a scratch or with minimum injury. Suggestions as to the way out of the situation have been as varied as those making the suggestions. Many believe in the adoption of cost-cutting measures, beginning with a pruning down of the cost of governance. Mr Seyi Gambo, a former National Public Relations Officer of PENGASSAN wants the Federal Government to tackle the issue of wastages in the economy by slashing the emoluments of members of the National

Assembly just as he called for reduction in the expenses of running the executive arm of government. An analyst, who pleaded anonymity, urged a change in the current culture of sharing oil earnings between the three tiers of government - Federal, States and Local Governments, urging that the state governments should develop their own sources of revenue. President of Bank Directors Association of Nigeria, BDAN, Mr. Sunny Kuku, urges that the nation be more inward looking as he also called for a reduction in the cost of governance. “We should reduce the cost of governance, reduce unnecessary cost of importation, things that we do not need. We should look inward like India and China did," he said. According to the President of

Lagos Chamber of Commerce and Industry, LCCI, Mr Remi Bello, a diversification of the economy is what the nation needed. "The price crash in the oil sector showed that the economy ought to be diversified in such a way that we don’t depend on crude oil. The government should look into agriculture products, minerals, among others. This signal is telling us we have been careless about the management of our resources,” he said. For Mr Kazeem Bello, an energy expert, Nigeria "must diversify in terms of other viable frontiers of international revenue earning. Secondly, we must make the private sector our engine of growth in order to generate more exportable goods and services". "Thirdly, government should demonstrate the political will to fight corruption and mismanagement which are part of a `lachrymal waste pipe’ of public resources," he stressed Sewa Wusu, analyst at Sterling Capital, would want the government to focus on taxation to make more funds available to government so also Razia Khan, head of African markets at Standard Chartered, who also said, “a good, long-term measure would be to focus on drawing informal sector companies into the tax net, though she recognised that "this is difficult to achieve.” For the Head of Macroeconomic and Fixed Income Research at FBN Capital, Gregory Kronsten, the Federal Inland Revenue Service, FIRS, needed to buckle up by bringing into the tax basket many companies in the country that do not pay. President of Bank Directors Association of Nigeria, Mr. Kuku is also of the view that "the real economy should be developed by focusing on small and medium enterprises and investing in infrastructure”. Government, he further stated, should take its hands off businesses ensure regulation, security, social development while allowing the private sector to do the rest. For Prof. Adolphus J. Toby, the Dean, Faculty of Management Science and a Professor of Banking and Corporate Finance at the Rivers State University of Science and Technology, RSUST, the way forward for Nigeria is a diversified economy, and then the government should begin to think about Nigeria without oil for the next ten years. “A way forward for Nigeria is a diversified economy. A shift away from the mono-product economy which relies on oil as it major source of revenues to an economy that receives revenue from different sources; sources like agriculture, manufacturing, exports and even from other natural resources apart from oil such as coal, granite and other extractive minerals. “Then there is also a need for financial sustainability, strengthening of government institutions and having the right change agents in position of authority. The federal government should be resolute in

CONTINUES ON PAGE 5

Cover

2015 January, SweetcrudeReports

PIB passage'll give boost to local refining

Fuel station CONTINUED FROM PAGE 5 building indigenous capacity and diversifying the economy. Those things that we need not to import we should stop importing them, and then it will be great if we can think about Nigeria without oil in the next ten years, at least it will reduce the level of heart-attack the economy is currently facing,” Prof. Toby said. The local refining option Other economic analysts and industry experts who spoke to our correspondents across the country say the current situation Nigeria had found itself came as a result of bad leadership and poor handling of both resources from and assets in the nation's allimportant petroleum sector. The good news, they maintained, is that the situation has given the nation and the government a golden opportunity to work towards ensuring local refining of its crude oil to provide petroleum products to a hungry market that has been completely taken over by foreign imports. By refining its crude locally Nigeria would have added value to the crude and in the process creating jobs for its unemployed youths. “A major way forward is for Nigeria to begin to refine its crude oil and take advantage of enormous derivatives that come in the refining of crude oil locally. Hundreds of thousands of new jobs will be created if our oil is refined locally,” Comrade Unyime Usoro, Chairman of the Akwa-Ibom Council of the Nigerian Labour Congress, NLC, told SweetcrudeReports. He added: “The present situation should create room for

our gas reserves to be fully exploited and utilized. Fuel price should come down and this will free some funds currently used on high fuel prices. The freed funds can be channelled to the provision of social services such as education and health”. An analyst, who pleaded anonymity because of closeness to government, said,"The situation in the global oil market calls for a national emergency in favour of local refining of crude. Obviously, no one will buy our crude oil any more because there is a glut in the market. The sensible way out of the ugly situation is to add value to our crude oil by refining locally and then target West Africa as a market". "There is a short way to do this. We can start by operating modular refineries, floating refineries and the rest of them. These will not take time to put in place. These come highly recommended in an emergency situation, if the government would be ready to act," the source added. The big question is really if the government would be ready to act on these because there had been cases of modular refineries projects in the past that never came to realisation," he further stated. The other option is to revamp the nation's four existing ailing local refineries in Wa rri, Kaduna and Port Harcourt, which have a combined refining capacity for 445,000 barrels of crude oil per day. The four governmentowned plants, the last of which was built in 1988, had been crying for maintenance with little or lack of attention from the various successive

governments in the country. Another analyst said: "The Federal Government should summon the political will to bring on board private refineries. A number of them have been licensed in the last few years with none coming on stream." Indeed, about 18 companies were about 14 years ago given licence to build and operate private refineries by the government, but none had progressed to production. Many never went beyond the site clearing stage as several factors, among them, lack of policy clarity on the part of the government, made further progress dicey.

investment into the oil and gas sector. If we are to talk about refining locally for instance, how can Nigeria refine locally when the PIB is not passed? Who will even want to invest in refining locally when the PIB is yet to be passed? "We need to change the models used in running the nation’s refineries, we should rather use the LNG models to run them. The government should grant incentives to private people to invest in the refineries so that they can produce locally. But then all these have to do with how responsive is the government to the yearning and aspersions of the ordinary people, and it is an issue because if the ordinary PIB passage'll give boost to people cannot elect who leads local refining them, their opinions will matter To push the establishment of little in governance,” Onuegbu local refineries and give a boost asserted. to local refining of petroleum, Comrade Chika Onuegbu, the Fuel prices can't drop Trade Union Congress, TUC, because of importers' greed Chairman in Rivers State and Industry experts pointed out as i m m e d i a t e - p a s t N a t i o n a l one of the aberrations of Nigeria Industrial Relations Officer of and the negative effect of lack of P E N G A S S A N , s a y t h e local refining, the fact that the Petroleum Industry Bill, PIB, drop in global oil prices have not still trapped in the National brought about a reduction in Assembly, must be passed into local fuel pump prices. In South Africa, for instance, law. "We must pass the PIB, so that petrol price has fallen by 127 we can attract direct foreign cents per litre, diesel (105 cents

It is the kind of wonder you see in Nigeria, that crude oil prices would fall in the global market, yet local fuel prices would remain unchanged in Nigeria

per litre), and liquefied petroleum gas, LPG, or cooking gas (210 cents per kilogramme while in the United States the pump price of petrol was on Monday as low as $2 a gallon about N84 per litre. Despite calls for a reduction in fuel prices by the Nigeria Labour Congress and the Trade Union Congress, petrol still sells at the official N97 per litre price, as prices of kerosene and cooking gas also remain unchanged. Many analysts who spoke to SweetcrudeReports blamed this on greed and avarice of petroleum product importers, stressing that the system has been rigged to always serve the interest of the oil companies against the citizens. Others blamed the ineffective regulation in the system, and the subsidy process, which they say, is yet to deliver on rewards for Nigerian consumers of petroleum products. "It is the kind of wonder you see in Nigeria, that crude oil prices would fall in the global market, yet local fuel prices would remain unchanged in Nigeria. If local fuel prices cannot drop at a time of low crude oil prices, at what point will it then drop?" queried one of the analysts. He added: There are many variables involved in fuel importation and supply in Nigeria, but even with all the other variables being static, a reduction in the cost of the major variable, which in this case is crude oil, should naturally necessitate a drop in fuel prices anywhere in the world, even if the drop would be marginal". Director of Communications at the Petroleum Equalisation (Management) Fund, PE(M)F, Mr. Goddy Nnadi, explained that for Western economies, it is easier and faster to feel the impact of the global fall in the price of oil. “But for us in Nigeria, it is not the same because we do not refine the products here, we have to go really far away to refine the products, pay for transporting it back to the country, including other handling and insurance charges". He noted that even when the products arrive Nigeria, there are other factors that go into the process which eventually further increase the cost, saying: "Someone has to pay for all of that, and thus your prices remaining where they are in spite of what we find in other societies.” He noted that, “Basically, we import refined products, so you pay the cost of the crude which has come down globally now, and you also pay for the refined products, including the transportation and the inefficiencies that crop up in the system”.

Oil

2015 January, SweetcrudeReports

Oil Price Fall: Industry players seek survival strategies KUNLE KALEJAYE

he sharp decline in crude oil prices has boxed operators in Nigeria's oil and gas industry, as their counterparts in parts of the world, to a corner, with many seeking to restructure their economic priorities and operations to meet the exigencies of the t i m e . Industry players, who spoke at the annual business dinner and award ceremony of the Petroleum Technology Association of Nigeria, PETAN, were of the view that the development held dire consequences for Nigeria and its economy as they advocated the need for players to look inward and tap indigenous human and capital resources that would drive full industrial operations in the sector. According to Engr. Emeka Ene, the chairman of PETAN, the current oil price dilemma was a universal concern that affects all interests in the Nigerian oil industry. Players, he said, must face the new reality by adopting cost efficient measures in keeping afloat. For him, local content remains the only path for the industry through the prevailing market turbulence. He affirmed that the Nigerian government's local content policy has significantly transformed the industry's landscape in a manner never experienced in the nation's petroleum sector, adding that international oil companies have continued to collaborate with PETAN in a win-win a p p r o a c h . Managing Director of Oando Gas and Power, Mr. Bolaji Osunsanya, who also said indigenous Nigerian companies had a significant role in Nigeria weathering the current oil price turmoil, affirmed that survival of the Nigerian Petroleum industry and the success of running policy programmes depend on ability of local service providers to deliver. PETAN, he stated, has the challenge of developing the technology that would enable the industry overcome lean margins under the current price downturn. On his part, Executive Secretary of the Nigerian Content Development and Monitoring Board, NCDMB, Engr. Ernest Nwapa, who was also a speakers at the event, said the local content policy

An artistic impression of oil barrels

The hope of the industry must be planted in the indigenous players,” he said as he noted that industry tradition has started altering in favour of local content.

has progressed beyond reversal and oil price drop was a challenge Nigeria must o v e r c o m e . What this means according to Nwapa is that indigenous players in the industry must rise to the challenge of driving the industry at times of commercial adversity. He urged PETAN and other sister associations in the industry to assume more responsibility at critical moments to ensure the

survival of the Nigerian petroleum industry, adding that the only way out of the tight oil price curve was for the different business interests in the industry to foster unity in tackling a common problem. “Collaboration among local and international players in the industry is what is required to sustain Nigeria content development ,” he d e c l a r e d . Nwapa pointed out that the

indigenous players in the oil and gas industry have escaped the average psychological limits in the country, stressing that the mindset of the industry has developed above the Nigerian psychological template. He said recent advances and milestones recorded by local players indicated that inves tors have started advancing into new frontiers driven by strong belief in local capacity to deliver on tough assignments in challenging terrains. He also pointed out that the capacity and efficiency so far demonstrated by indigenous oil companies that acquired divested assets have addressed the concern about the sustainability of the government’s local content policy, adding that the wisdom of President Goodluck Jonathan in enacting the policy into law has been robustly justified. He lamented that the decades wasted in depending

on the multinational joint venture operators to groom the Nigerian National Petroleum Corporation for exploration and production operations proved futile, stressing that no group of players would realize Nigeria’s national aspirations in the industry better than indigenous players. “The hope of the industry must be planted in the indigenous players,” he said as he noted that industry tradition has started altering in favour of local content. The changing tradition has made it easier for violation of Nigerian Content provisions to be very obvious whenever it happened, he maintained. Nwapa revealed that bankers’ support for the industry has also continued to improve with the rising indigenous capacity for job execution. "With the evolving tradition, services around the industry have also started responding to the needs of compliance", h e s a i d .

2015 January, SweetcrudeReports

Oil

Oil vessel

30 Nigerian January oil cargoes unsold - Traders CHUKS ISIWU

h e r e w e r e indications that, as year 2014 ended, over 30 Nigerian January loading cargoes remained unsold, with the nation's overall crude oil exports expected to witness a noticeable drop in February. According to market sources, Angola, Africa's second largest oil producer after Nigeria, was luckier, having sold out its January programme as at the middle of last month. “ Th e A n g o l a n J a nua ry programme is sold out thanks to the Chinese but on Nigeria, we still have almost 40 million barrels left (including) some December barrels on storage," a t r a d e r s a i d . The development is a sad one for Nigeria, which is already facing a bleak 2015 following dwindling oil prices that is expected to hit its 2015 budget. Prices have in recent weeks fallen below the country's $65 per barrel projected oil benchmark price as contained in the budget. SweetcrudeReports reported recently that Nigeria's crude cargoes for January loading were struggling to sell due to very weak demand with an oversupply of sweet crudes in t h e m a r k e t .

Demand for the Nigerian crude and other West African cargoes in Asia and Europe remains slow, as according to traders, there is an over-hang of cheaper sweet crudes on the two c o n t i n e n t s . The costs of the Nigerian crude and the brands from other West African countries are impacted by high freight rates, traders said. Meanwhile, Nigeria's crude oil export level is expected to fall in February to about 1.87 million barrels per day, a drop from about 2.03 million barrels projected for the month of J a n u a r y . According to a Reuters report, the expected drop in exports in February would be due to availability of less of the benchmark Qua Iboe oil, as the multinational ExxonMobil shuts its Ibeno terminal, near Eket, Akwa I b o m S t a t e , f o r maintenance. The report indicated, however, that the export level would still be higher than those for much of 2014, as there would be relatively strong production of other Nigerian grades such as Brass River (Agip) and

B o n g a ( S h e l l ) . As it concerns declining oil prices, a monthly poll by the international news wire indicated that prices would rebound in 2015 and 2016 as the market stabilises in the wake of a near-40 per cent collapse since last year. The Reuters report indicated that analysts still see oil prices averaging more than $10 a barrel above current levels this year, even though forecasts actually collapsed in the wake of the Organisation of the Petroleum Exporting Countries, OPEC's, decision, at its last meeting two months ago, not to cut output despite a global glut. The survey of 31 analysts and economists, conducted after the OPEC meeting in Vienna, Austria, forecast North Sea Brent crude would average $82.50 a barrel in 2015, down $11.20 from last m o n t h ' s p o l l . It is the biggest downgrade in average forecasts since the global economic crisis in 2008 and compares with an average price of around $102 for Brent so far this year. The poll forecast Brent would average $ 8 7 . 4 0 i n 2 0 1 6 . But the projections are still well above current prices,

NNPC headquarters, Abuja

Govt issues vacation order over structures on NNPC's right-of-way

he Federal Government has warned those who encroached on the Nigerian National Petroleum Corporation's, NNPC, right-of-way to vacate such locations. The Public Affairs Manager of Pipelines and Products Marketing Company, PPMC, Mr Nasir Imodagbe, stated this in Abuja, saying government was set to clear all structures obstructing the oil pipelines’ “Right of Way” across the country. He said the mandate of PPMC was to clear obstructions to secure the company’s right-of-way. The spokesperson, who decried the high level of encroachment on the right-of-way, said that there would be no compensation for anyone whose structure is demolished. He said that those encroaching on the stretch were illegal occupiers of government land because they had no approval from government before they built on the pipelines’ right-ofway. He explained that oil pipelines passed through the way and that no structure was expected to be on it. “Any structure on it is illegal,” he said. He said demolition had already been carried out on the stretch in Lagos and some areas in the northern part of the country, adding that those who encroached on the company’s right should therefore stay clear and not wait for the demolition team to arrive. While stressing that government was poised to reclaim the entire oil pipelines right of-way, he stressed that the aim was to stem the activities of vandals on the pipelines.

Oil

2015 January, SweetcrudeReports

Two in EFCC net over N500m oil scams OSCARLINE ONWUEMENYI

he Economic and Financial Crimes Commission, EFCC, has smashed a syndicate of suspected fraudsters, who duped their victims over N300 million in cases involving different fake crude oil deals. According to the EFCC, two members of the syndicate, Michael Morowie and Emmanuel Owoicho, were in the custody of the commission explaining their involvement in the crude oil scam. The EFCC spokesman, Wilson Uwujaren, stated in a statement that “EFCC moved against the syndicate following complaints by victims who had been fleeced by the alleged fraudsters. “An unsuspecting victim alleged that members of the syndicate collected N119m from him on the pretext of supplying him with two million barrels of Bonny Light crude oil. Eventually, the oil supply documents, which were purportedly obtained from the Nigeria National Petroleum Corporation, were found to be fake.” He explained that in the course of investigation, operatives of the EFCC also quizzed one Samson Omobere

of Etsam Oil and Gas Limited, who admitted to have collected the N119m from the complainant. The suspect alleged that he transferred a substantial part of the money to the Magnificent Marine Services Limited. “This led to the arrest of one Michael Morowie, a director in the Magnificent Marine Services Limited, who allegedly withdrew over $358,000 and N11.7m from the company’s account under the names of Boma Harry, Peterson Harry and Elder Dan Jumbo,” Uwujaren said. He added that four driving licences bearing his photograph under the name of Michael Morowei as well as several other scam documents were recovered from the suspect’s house. The EFCC said another member of the syndicate also obtained N300,000 from another victim, a Kenyan citizen resident in G e r m a n y . “The syndicate had sold the same dummy of supplying him with two million barrels of Bonny Light crude oil,” Uwujared stated. The EFCC spokesman added that the commission was investigating the sy nd i ca t e f o r a no t he r

alleged case of obtaining N102.8m from another com p la ina nt und er t he pretences of supplying him two million barrels of Bonny L i g h t c r u d e o i l . According to the anti-graft agency, one Emmanuel Owoicho of Owoema Resources Limited, confessed to have collected N15m from the complainant.

It added that Owoicho directed the complainant to pay the bulk money to some bank accounts, including Allen Logic Ways Unique Services Limited. “Acting on this lead, the EFCC arrested one Michael Oghenemi. “The EFCC also recovered the letterhead of Allen Logic

Ways Unique Services, which was registered in the name of Pabor Wariowei, from his h o u s e . “About N14m was transferred to Standard Allied Universal Concept registered by Fubara Jumbo, one of the pseudo names used by the suspects.They will be charged to court after investigation is concluded," Uwujaren added.

'No chance' of OPEC cut - Report

audi Arabia and its Gulf OPEC allies are showing no sign of considering cutting output to boost oil prices, which are at their lowest levels in more than five years after dipping below $50 a barrel this week. OPEC decided against limiting production at its last meeting on 27 November, despite misgivings from non-Gulf members, after Saudi Oil Minister Ali al-Naimi said the group needed to defend market share against US shale oil and other competing sources. Those misgivings have grown with a slide in oil prices to below half their level in June, according to Reuters. This has hurt the economies of Opec's smaller producers. Benchmark Brent slipped

OPEC headquarters in Vienna, Austria by 22 cents to $50.93 a barrel by 12:35 pm in New York (1735 GMT). It had dropped to $49.66 on Wednesday, its lowest since May 2009. US crude was up a cent at $48.66, after plumbing a 51/2-year low of $46.83 in the previous session, Reuters reported. OPEC has forecast an

increasing surplus in 2015, citing rising supplies outside the group and lacklustre growth in global demand. But the Gulf members, who account for more than half of Opec output, are not wavering, arguing lower prices will slow competing supplies, spur economic growth and revive demand.

Oil

2015 January, SweetcrudeReports

Nigeria marginal fields

DPR to commence recovery of idle marginal fields in March KUNLE KALEJAYE

lose its assets, Osahon 2003 we gave five years to disclosed that when the bid develop these fields, after he Department of round was done in 2003, that we gave another five ‎ P e t r o l e u m operators were given five years and that is what is Resources, DPR, years to develop their fields about to expire sometime w o u l d b e but that close to the n e x t y e a r ( 2 0 1 5 ) . r e c o v e r i n g a l l expiration of the period, "Think about it, if these fields non-performing marginal government gave additional were collected from major operating companies because fields from the 2003 bid round fiver years. from their operators by March He said it was the interest of they did not develop them – t w o m o n t h s a w a y . government to diversify after 10 years. W i t h t h e d e v e l o p m e n t , exploration and production “Section 16 of the law is very according to the DPR, the a c t i v i t i e s i n N i g e r i a , clear about that. What will licences covering the awards stressing that this interest happen when you keep them would be revoked and the w a s w h a t l e d t o t h e with Nigerian companies for operators would lack all emergence of indigenous another 10 years? There is no c l a i m s t o t h e f i e l d s . operators in the country. just need, something has to Director of DPR, Mr. George "Marginal fields are the total happen. We need to move on. Osahon, who revealed this in local content initiatives for "Government has concerns Lagos, said 10 years after the t h e e x p l o r a t i o n a n d and one of it is that there is no fields were awarded to production space in the need to keep reserves when operators, they (operators) country. It is not an end in they are not in production. ought to have developed the itself, it is a means to an end. People are aware that since assets. "We know that people who 2010, production has being There are approximately 28 have assets have challenges declining and we need to do marginal fields, two of which but two things affect them something about that". were given out before the most and one of them is On the current crude oil 2003 bid round while 24 fields funding, the other one is the price drop, Osahon said this were later given out to 31 technical competence and was not the time to go into companies. capability for people to exploration and production, Maintaining that it was not operate their assets,” the but stressed that this did not the intention of‎ the regulator DPR boss said. mean that marginal field or the Ministry of Petroleum He continued: "Talking operators should not engage Resources for any operator to about government support, in i n e x p l o r a t i o n a n d

p r o d u c t i o n . "Cost of E&P also tends to go down during this period. So, if you wait long enough for those who have been there, there will be enough reason for you to go into oil exploration, but the cost will be l o w , ” O s a h o n s a i d .

Total to drill 44 wells at Egina

ultinational oil company, Total, would be drilling 44 wells at its Egina field as part of the programme to bring the asset to production by 2017. According to the company, two rigs would be kept busy at the Egina field for a total of 3,000 days, drilling the 44 wells in water depths ranging between 1,400 and 1,700 meters. The international oil company disclosed this as it unveiled drilling programme for the Egina project. This is the deepest offshore project ever operated by Total. With production of 200,000 barrels per day, it will contribute significantly to achieving Total’s 2017 production objectives,” Executive General Manager of the Egina Project, JeanMichel Guy, said in a statement. Guy stated that besides contributing to Total's production objectives, Egina project would also boost local content as thousands of local jobs woud be created while local infrastructure would be impacted. The statement added that Egina's field infrastructure would include an Floating Production Storage and Offloading, FPSO, unit, an oil offloading terminal and subsea production systems such as risers, 52 kilometres of oil and water injection flowlines, 12 flexible jumpers, 20 kilometres of gas export pipelines, 80 kilometres of umbilicals, and subsea manifolds.

Oil

2015 January, SweetcrudeReports

Local content policy has progressed beyond reversal -Nwapa association and other sister groups in the industry to assume more responsibility at critical moments to ensure the survival of the Nigerian petroleum industry. He added that the only way out of the current tight oil price curve was for the different business interests in the industry to foster unity in tackling a common p r o b l e m . “Collaboration among local and international players in the industry is what is required to sustain Nigeria content development,” Engr. Nwapa declared as he pointed out that the indigenous players in the oil and gas industry have escaped the average psychological limits in the country. Stressing that the mindset of the industry has developed above the Nigerian psychological template, he

Eland secures credit to fund Opuama field development

Local engineers at work SAM IKEOTUONYE

x e c u t i v e Secretary of the N i g e r i a n C o n t e n t Development and Monitoring Board, NCDMB, Engr. Ernest Nwapa, says the Federal Government's local content policy has progressed beyond reversal. B, Engr. Ernest Nwapa, says the Federal Government's local content policy has progressed beyond reversal. The implication of this, according to Nwapa, is that indigenous players in the oil and gas industry must rise to the challenge of driving the industry. In a keynote ad dress at t he annual business dinner and award by the Petroleum Technology Association of Nigeria, PETAN, he urged the

The implication of this, according to Nwapa, is that indigenous players in the oil and gas industry must rise to the challenge of driving the industry. stated that recent advances and milestones recorded by local players indicated that investors have started advancing into new frontiers driven by strong belief in local capacity to deliver on tough assignments in challenging terrains. According to Nwapa, the capacity and efficiency so far demonstrated by indigenous oil companies that acquired divested assets have

maintained that no group of players would realise Nigeria’s national aspirations in the industry better than indigenous players.

Said he: “The hope of the industry must be planted in the indigenous players,” he said, adding that industry tradition has started altering in favour of local content. He pointed out that the changing tradition has made it easier addressed the concern about for violation of Nigerian the sustainability of the Content provisions to be very government’s local content o b v i o u s w h e n e v e r i t happened. policy.

Lamenting the decades wasted in depending on the multinational joint venture operators to groom the Nigerian National Petroleum Corporation, NNPC, for exploration and production operations, the NCDMB boss said this proved futile as he

“With the evolving tradition, services around the industry have also started responding to the needs of compliance, he said. He noted also that bankers’ support for the industry has also continued to improve with the rising indigenous capacity for job e x e c u t i o n " .

est Africa-focused Eland Oil & Gas has announced that it has arranged a new credit facility for up to $75 million. The firm said the credit facility will enable it to continue the development of the Opuama field on Oil Mining Lease 40, offshore Nigeria, as well as fund general working-capital expenses. The reserves-based lending credit facility has been arranged with Standard Chartered Bank and has a maturity of four-and-a-half years. It is payable quarterly from September 2016 and has a margin of 7.75 percent over the London Interbank Offered Rate. Eland CEO George Maxwell commented in a company statement: "I am delighted that we have signed this RBL facility. The strong commitment from SCB in the current market conditions highlights the robustness and value of our asset base even accounting for the current lower oil price environment.

Oil

2015 January, SweetcrudeReports

GE, Heirs Holdings to jointly pursue opportunities in Nigeria's oil & gas

S energy giant G e n e r a l Electric, GE, and Nigeria's H e i r s Holdings, HH, have reached agreement to expand their existing relationship to jointly pursue opportunities in Nigeria's Oil and Gas i n d u s t r y . Having identified enormous opportunities in the upstream sector and the domestic demand for oil and gas, both companies are poised to collaborate in transforming the industry landscape. Before now, GE's collaboration with Heirs Holdings was focused on the Nigerian power sector and specifically the expansion of Transcorp Ughelli, Nigeria's largest power station. According to the companies, the latest move is a clear demonstration of a new approach by multinational companies to develop meaningful and long term partnerships with credible and strong indigenous companies across a range of sectors. It is also an endorsement of the growing maturity of Nigeria's private sector. Chairman of Heirs Holdings, Mr. Tony O. Elumelu, said the expansion of the relationship with GE represents a pivotal moment for the oil and gas industry and for Nigerian businesses as a whole. He added that this marks a major milestone in the Heirs Holdings strategy to domesticate value across the energy sector. "Partnerships like this capture the spirit of what I have termed Africapitalism and bring together global entities and world-class Nigerian companies. These are the kinds of investments we need to create employment and ensure economic value," Elumelu said. The agreement will ensure the development of local capacity, technology transfer and leverage the best of global technology to deliver a solution fit for the African market, he added. Vice-Chair of GE Global John Rice said the agreement was a further

John Rice, Vice-Chairman, GE Global. Tony Elumelu, Chairman, Heirs Holdings, Lazarus Angbazo, President and CEO, GE Nigeria and Jay Ireland, President and CEO, GE Africa at a partnership signing ceremony in Lagos.

Partnerships like this capture the spirit of what I have termed Africapitalism and bring together global entities and world-class Nigerian companies. These are the kinds of investments we need to create employment and ensure economic value example of meaningful local content delivery in Nigeria's petroleum industry. "Our work with Transcorp and now, Heirs Holdings is ample proof of our commitment to continually identify and align with strategic stakeholders to create jobs, facilitate technology and skills transfer in critical sectors of the economy," he said.

The developing GE-HH relationship is expected to lead to significant investment and supply chain benefits for a whole range of Nigerian companies, operating across the industry value chain. Both organisations aim is to act as a catalyst for a far broader participation of small, medium and large Nigerian enterprises.

Russia oil output hits post-Soviet high

ussia's 2014 oil output hit a post-Soviet record high average of 10.58 million barrels per day, bpd, rising by 0.7 percent helped by small nonstate producers, Energy Ministry data has shown. Oil and gas condensate production in December hit 10.67 million bpd, also a record high since the collapse of the Soviet Union. The data showed Russia's so-called small producers, mostly privately held, increased their output by 11 percent to just over 1 million barrels per day. Crude oil exports via state monopoly Transneft fell 5 per cent to 195.5 million tonnes due to rising domestic demand and refinery runs. Exports to China reached a new high of 22.6 million tonnes (452,000 bpd), up 43 percent on the year as Russia seeks to diversify its energy customers. Russian producers capitalised on rising oil prices in the first half of 2014, when they reached over $113 per barrel. However, they have halved since then. Hurt by falling oil prices and Western sanctions prompted by Moscow's role in Ukraine, growth in oil output in 2014 slowed from a gain of 1.4 percent in 2013. Top listed oil company Rosneft, which produces more oil than OPEC members Iraq or Iran, saw its output slip 0.7 percent as it struggled to arrest declining production at its West Siberian fields. Oil and gas fund about half of Russia's budget. The country's economy is slipping into recession following a fall in oil prices and could see oil output decline to 525 million tons in 2015, according to an Energy Ministry forecast.

Focus

2015 January, SweetcrudeReports

i r e c t o r General of Nigerian Maritime Administrati on and Safety Agency, NIMASA, Ziakede Patrick Akpobolokemi, has been at the helm of affairs at the national maritime regulator in the last four years. At a recent press conference in Lagos, Mr. Akpobolokemi speaks on the agency's activities in the last four years and on other issues relating to the nation's maritime i n d u s t r y . SweetcrudeReports KUNLE KALEJAYE was there to capture his response E

telling people. When oil companies now do advert, they will mention that 'adherence to the Cabotage Act' is mandatory. Why the delay for a national carrier? I appreciate the anxiety because if I were in your shoes, I will also be asking all these questions from the DG, asking him how many jobs have been created under the Cabotage Act, why the delay for a national carrier? In the last four years, the efforts put in place have not materialised into practical reality that will enable us have a national carrier, but, we are setting the foundation for it. We equally know that the areas we are lacking is too much and we are taking them one at a time, and it is becoming too difficult.

Right now as we speak, a committee on national carrier has been constituted, a blue print is being worked upon which we want the government to address and we will not allow government at all levels to rest until they given us what Nigerians are asking for.

Was it all rosy for NIMASA in 2014? I don't even like an easy life. When I wake up in the morning, the first thing I pray for is that the day be very difficult because out of a rough sea you will make a good captain. When you lay things on a platter of gold, you cannot conquer things you even envisage. If you have children and everything is at their disposal - money, food, cloths, house - they will not appreciate what you are doing and will not understand what is life. The time they will understand what life is all about is when you are no more there to provide for them. The training I have is to take life as a difficult place. We have come in and actually, life is a difficult place. Even in our own individual lives, you will have challenges. Even if God speaks to us directly or loves us best, we will have challenges. So, if you come into a maritime administration as NIMASA and you think it is going to be easy it's not possible. You see people who are stealing oil and you confront them, you think it will be easy? You see people in organised piracy, sea robbery, kidnapping in the water ways and you think it will be easy? You see people who don't want to conform to vessels' regulations, you see the bureaucracy of getting things to work. Nothing can be easy. But, the thing is that you must not give in to fear, you must have a goal and ask God for support. The most important thing is the purity of your intention, that's what is going to save you. If your intentions are not pure, God will see you no matter how you want to hide. So, it has been very challenging, but, we are making unusual gains out of

Akpobolokemi

If you kidnap, we'll come after you, Akpobolokemi warns sea pirates the difficult situations. The maritime administration has stayed for so long, why is that it is just in the past four years that we are talking about domain awareness, satellite, radial, patrol boat? These things comes with too much trouble, but the troubles are also our inspirations and your prayers are also the thing making us to succeed. Your quite time of prayer goes a long way to help us because only one of the problems is enough to give anybody high blood pressure. But, we thank God, none of us has high blood pressure, because you are all praying for us and our intentions, even though we make mistakes, are not impure.

Kindly tell us the number of jobs created so far under the Cabotage Act? I know that thousands of jobs are created, but to pin it to a precise number as we speak is difficult. However, after this conference, we can speak with

the Cabotage Unit to give us the number of jobs created under the Cabotage regime. There is nothing hidden about it. I know that we have created thousands of jobs. These are not things that we have to go to the street to be

The most important thing is the purity of your intention, that's what is going to save you. If your intentions are not pure, God will see you no matter how you want to hide.

So, by the next four years of this regime, a national carrier will come. Therefore, I appreciate your anxieties, your feelings about it because it is a constructive way to think. How many vessels has been attacked under your watch? What I know is that in the last one month plus, the number of vessels attacks we have stopped in Lagos area alone and the number of pirates in our custody is alarming. None of them succeeded, some of them have been handed over to the navy, and civil defence for persecution. Some of the vessels are in our custody. If any pirate wants to attack any vessel in Lagos, it will take the grace of God for them to succeed because while they are planning to attack the vessel, we are already aware of it and ready to strike them. Besides the satellite, we have other mode of operation that we can use to get these people. If you kidnap, we will go after you. That is why we are saying that people should not pay ransom for hostages to be released. We have to go after them and crush them. We will all die some day and that is the truth about the matter. It is either we die in the hands of pirates or in the hands of robbers or in our sleep or sickness or without any cause, everybody will die at some point in time. So the issue of fear to approach pirates or afraid of kidnappers should not be there. They use to send me text messages but I will reply them that we are coming after them and will crush them.

CONTINUES ON PAGE 14

2015 January, SweetcrudeReports

Focus CONTINUED FROM PAGE 13 We must fearlessly approach any person that is causing us problems. Pirates in Lagos area cannot operate because before they go out, we crush them and we are going to sustain that. If I tell you the number of vessels that we have arrested, including pirates, and areas we have conquered in collaboration with JTF alone, you will be surprised. Why are wrecks still in Lagos waterway? Government has awarded contract to remove wrecks in all our maritime domain. They have started and by the grace of God, the wrecks are going to be removed. The first phase of the job has been awarded in the southern areas, Lagos inclusive.

job. If you violate our laws, â&#x20AC;&#x17D; irrespective of your political affiliation, the first thing we will do is to detain your vessel, take you to the court, if you bribe your way out of court, well that is your luck.

If you kidnap, we'll come after you, Akpobolokemi warns sea pirates

Let me tell you some thing. We will give marine notice 20 times telling people to remove their wrecks, and nobody will show up, but, the day you want to remove their wrecks that has been abandoned for fives years, you will suddenly see the crew. The next day they would go to court to get injunction. I'm telling you what is happening.

Over 2,500 of them. We have two windows, the first window is state and NIMASA partnership. From the MoU we have with the various states, we contribute 40 percent and they contribute 60 percent. But, we contribute far beyond 40 percent because the traveling expenses, medical fees, feeding, accommodation etc of the seafarers are taken care of by NIMASA. However, some states refused to partner but we created another window that is the one that is addressed as first aid participation and the number is very few. Therefore, the bulk of the over 2,500 seafarers are from NIMASA full time training, full time scholarship. We spend billions of naira yearly for this training. How many arrests and persecutions have been

Once we are through with all the resolutions and the rest of them, we will invite the press and tell them that this is the communique that has been agreed on, this is the timeline for 'A', 'B', 'C', 'D', waver conditions etc.

I have written so many of these letters and many Nigerians have gotten jobs but I will not come and announce this kind of thing. Once you draw my attention that you have these vessels, just give me the information and that oil company will not move.

Someone will go to court and say that his wreck is worth $10 billion, meanwhile, the actual cost of the vessel might not be up to $1 million. After using the vessel for 20 years and abandoning it, he is coming to ask for $10 billion compensation. That is the true situation.

How many Nigerians have benefited from the seafarers programme?

We have to do our job and leave posterity to judge if we did our own part of the bargain or not. We are going to go after them, the OPTS (major oil companies) is already working with us with the purpose to implement the Cabotage regime and other necessary business.

I have personally written to oil companies to give jobs to Nigerians when they have vessels. No matter how tight my schedule is, I have personally gone to inspect some of these vessels and I have written to so many companies, saying "this vessel by the estimate or by the assertion of management meets the requirement of the Cabotage Law...and on no condition should this job be given to any foreigner."

We have so many court cases against us to remove wrecks. We have the mandate to remove these wrecks but if I tell you the number of litigation against us, you will be surprised. That is to tell you that we must change our ways.

Help to educate our people because wrecks can cause navigation problem, criminals hide there and that is why some don't want us to remove it because criminals are helping them do their business.

Akpobolokemi

If I don't fight them, I can be removed before the time God prescribed for me in this job, so the best thing is to prepare to fight for Nigerians achieved in terms of sea piracy and oil theft? I must be honest with you, persecution is a major problem. If I tell you that we have been successful in persecution, I am not telling you the truth. To implement the laws of this country is a major problem. When you take a pirate to court, in the next one hour, you will see him sending a text message that he is back and is going to deal with you. Sometimes is it very sad when I think of things like this. It is not about what we can do because there is separation of powers. What the law says we cannot do, we cannot do. Because of this issue of

persecution, we assembled judges and appealed to them to look into cases of pirates. If someone steals crude oil and is jailed for six months or one year, it will serve as a big discouragement to others not to do the same thing. But after 24 hours you will see the thief calling and telling you that he is back. It is a major problem for us and it is not what we can fix singlehandedly, rather all of us must come and find a solution to the problem. Our job is to arrest sea pirates, crude oil thieves and present them to the court. But, what happens thereafter, I don't k n o w t h e m a g i c . Why is the Cabotage Act not

being enforced? If people think we have not been enforcing Cabotage, that is not the situation. For Nigerians to get the jobs, we had two meetings with all the oil majors, we came up with some resolutions, we have subcommittees and we told them that Nigerians must get the cargo, Nigerians must get the job. So the sub-committees has started their job, we have met with the oil majors and in January 2015, reports will be submitted, then all parties will jointly agree and we will call the private sector to come and listen to us and make input to the implementation of the Cabotage regime. When NIMASA detains a vessel for non-compliance with Cabotage Act, we will give you a detention order and tell you what and what you have done. Some will evade our taxes and the rest of them, and then begin to cry foul. Some will want to link us with politics and the rest, but we are not politicians, we are doing our

If I don't fight them, I can be removed before the time God prescribe for me in this job, so the best thing is to prepare to fight for Nigerians. When someone brings in a vessel that Nigerians can do whereas our boys are not working, there is unemployment, there is crime, and will sit down comfortably and allow these kind of things to happen, it can't happen. So we will go after them one after the other and ask them if they are Cabotage-compliant. If no, what are the reasons? If it is something that was exceptionally difficult for us to handle at that time, we will now look into the problem. Since the inception of this agency, there has never been this kind of enforcement of regulation. The only difficult aspect of the Cabotage Law that we have not been able to implement is the distribution of CVFF (Cabotage Vessel Financing Fund), but in terms of employment - the crew and the - I have personally been signing them. When people write letters that they have vessels, I personally go to inspect them and I tell them on no account should jobs be given to a foreigners because these Nigerians have gone to collect heart-breaking loans from Nigeria banks and if you don't give the person job, is it not hypertension you want to give to h i m ?

Gas

2015 January, SweetcrudeReports

NLNG Vessel

NLNG Vessels: Nigerian firms begin export of products to Korea KUNLE KALEJAYE

everal Nigerian c o m p a n i e s participating in the supply of materials for the Nigerian Liquefied Natural Gas, NLNG's, six new ships under construction in South Korea, have commenced export of their products to the Asian c o u n t r y . The Nigerian companies would be reaping about US$10 million in revenues under the arrangement. NLNG, through its subsidiary company, Bonny Gas Transport, BGT Limited, had in 2013 contracted the building of the new vessels to South Korean shipbuilders, Samsung Heavy Industries, SHI,, and Hyundai Heavy I n d u s t r i e s , H H I . It successfully leveraged to include a unique local content clause which enables Nigerian companies to benefit from substantial vessel construction materials export contracts. SweetcrudeReports gathered that Paints and Coatings Manufacturers Nigeria

Limited, one of the key local company-beneficiaries, has already shipped 66,000 out of an agreed 388,000 litres of paint, to Samsung Heavy Industries shipyard in South Korea. Other companies which have also already exported products to South Korea include Berger Paints Nigeria Plc, which has exported 33,000 of its 83,000litre quota, worth over US$1 million, and Metec West Africa, which has exported 210 tonnes of anodes, valued at US$2.5 million. Nexans Kabelmetal Limited, another notable beneficiary, recently shipped 180,000 metres of cables costing over US$1 million to the South Korean shipyards. Captain Temi Okesanjo, NLNG’s General Manager, Shipping, said on the development: “The achievements recorded by Nexans Kabelmetal, Berger Paint Nigeria Plc, Metec West Africa and other Nigerian manufacturers, add to the success of our vessel acquisition project.

"The benefits from this project do not stop at exports. For example, Berger Paints and Kumkang Korea Chemicals Ltd (KCC), a South Korean company, and technical partner to HHI, will exchange staff in a special technology transfer programme.” “By the end of this project, NLNG would have helped the concerned local companies acquire the necessary capacity and know-how, to successfully compete with peers from all around the developed world. This is consistent with NLNG’s vision to help build a better Nigeria,” Okesanjo added. Also reacting to the development, Berger Paints Managing Director and Chief Executive Officer, Tor Nygard, said: "In the past, Berger Paints only exported paints to Ghana. This recent export of our products to South Korea is a major milestone for our company, and we are very excited for this remarkable opportunity. I believe efforts which follow the laudable NLNG example, will go a long way to develop the local industry in Nigeria."

In the past, Berger Paints only exported paints to Ghana. This recent export of our products to South Korea is a major milestone for our company, and we are very excited for this remarkable opportunity. I believe efforts which follow the laudable NLNG example, will go a long way to develop the local industry in Nigeria. NLNG exports liquefied natural gas through large ships to buyers in different parts of the world, and is ranked among the top five global suppliers of the fuel. The company, additionally, produces about 80 percent of the cooking gas currently used in the Nigerian market. The NLNG subsidiary, BGT, owns 13 of the 23 vessels in NLNG’s fleet and the acquisition of the six new vessels now being built in

South Korea, the first of which is due for delivery in 2015, positions the company to preserve and grow its position as a reliable player in the global energy market. NLNG is owned by four shareholders, namely, the Federal Government of Nigeria, represented by the Nigerian National Petroleum Corporation, NNPC (49%), Shell Gas BV (25.6%), Total LNG Nigeria Limited (15%), and Eni International (N.A,) ( 1 0 . 4 % ) .

2015 January, SweetcrudeReports

Gas

Clamp down on illegal gas refilling outlets, NALPGAM urges govt

Gas refilling plant KUNLE KALEJAYE

he Nigerian Association of L i q u e f i e d Petroleum Gas Marketers, NALPGAM, has urged government at all levels to clamp down on illegal gas refilling outlets in the country to avoid incessant gas explosions. Mrs Oluwafunke Eleyinmi, the NALPGAM Public Relations Officer, made the call in Lagos in reaction to the ghastly gas explosion that occurred recently in Akure, Ondo State. Eleyinmi said there was need for government to commence prosecution of unregistered cooking gas refilling outlets to avoid indiscriminate explosions in the country. According to her, most cooking gas explosions were caused by illegal gas plant operators who are not members of NALPGAM. "We want to use this medium to advise Nigerians to report any illegal gas re-filling

outlets within their neighbourhood to the a u t h o r i t i e s . "We commiserate with Ondo state government over the recent gas explosion incident, we also appeal to gas marketers to be safety conscious," she said. T h e N A L P G A M spokesperson advised the Department of Petroleum Resources, DPR, to publish names of accredited gas refilling retailers in the country as she called on government to design a method of tracking some of the illegal gas re-filling stations in the country. Eleyinmi urged the marketers who operated without license to register with DPR urgently to avoid wasting the lives of Nigerians, adding that NALPGAM would soon commence "Operation show your licenses" to identify illegal operators. "Plant operators must be conversant with all safety needs of LPG plant operations," she said, as cautioned DPR against approving the siting of gas

plants in a volatile and A k u r e . unconducive arena. "The owner of the facility is C o n c e r n i n g t h e g a s not a member of NALPGAM explosion in Akure, she said: and has no licence to operate. " N A L P G A M h a s We need to know who disassociated itself from the approved the siting of the owner of the illegal facility in skid gas facility in that area.

"Who gave the licence and when was it given? DPR is the government agency responsible for giving out such licences’’.

Experts counsel govt on gas utilisation

il and gas industry experts who gathered recently in Lagos at the 14th Annual General Meeting and Business Forum of the Nigerian Gas Association were firm in their call on the Federal Government to do more to end gas flaring in the country. They said the 1.79 billion dollars (about N289.60 billion) lost annually to gas flaring was too enormous to be ignored. The Director, Department of Petroleum Resources, Mr George Osahon, had in December 2014 revealed that Federal Government loses about N289.6 billion annually to gas flaring. Osahon said at the 14th Annual General Meeting and Business Forum of the Nigerian Gas Association that the figure came from the 1.4 billion cubic feet of gas flared by multinationals on daily basis. He said that the 1.4 billion cubic feet of gas flared per day cost the country 4.9 million dollars (about N110 million) at $3.50/1,000 standard cubic feet daily.

Seyi Gambo, former Public Relations Officer of PENGASSAN, said that there was need for government to enforce the terminal date on gas flaring and convert the flared gas to improving the level of power supply. Gambo said that an articulated deadline was what the country needed and penalties set aside for defaulters. Simon Philips, an environmentalist at the University of Port Harcourt, stated that there had been several terminal dates to end gas flaring which had failed. Philips added that it was time the government found a solution to the problem because of the country’s dwindling income. He restated that most countries of the world depended on gas for all kinds of domestic use. Philips also called on the multinationals and environmentalists to design a blue print that would put an end to gas flaring in 2015. He wondered why gas flaring would take decades to come to an end in the country.

2015 January, SweetcrudeReports

Gas

A dockyard

'NLNG's dockyard will generate revenue, add jobs to economy’

he Nigeria Liquefied Natural Gas, NLNG, Limited has said the dry-dockyard it plans to build in Badagry, Lagos, would be operated and managed according to international standards, and when operational, would generate revenue and add jobs to the Nigerian economy. NLNG is currently reaching out to investors in the financial institutions to promote the potentials of the new project. The location of the dockyard follows the conclusion of feasibility studies by Royal HaskoningDHV, an independent, international engineering and project management consultancy headquartered in the Netherlands. The studies came as one of the benefits of NLNG’s US$1.6 billion contract with shipbuilders, Samsung Heavy Industries and Hyundai Heavy Industries, for the building of six new vessels.

Jarmakani

According to a statement by Kudo Eresia-Eke, General Manager, External Relations Division at the NLNG, made a v a i l a b l e t o SweetcrudeReports , the feasibility studies for siting the dry-dock were carried out on seven places— Badagry, Lekki FTZ, Ladol Island, Ogogoro Island, Olokola FTZ, Onne and Bonny — before consultants identified Badagry as the best-in-class location for the dockyard. NLNG, leveraging on the agreement with Samsung and Hyundia, secured a number of lucrative opportunities beneficial to the Nigerian economy, including the training of about 600 young Nigerians in various aspects of shipbuilding, procurement of goods from Nigerian companies and the feasibility studies for building a dockyard. “This dry-dock, when completed, holds huge potential for the investment c o m m u n i t y .

"Our LNG vessels and very large crude carriers (VLCC) of other companies in the oil and gas, and marine industries, which are currently maintained overseas, resulting in millions of dollars being spent overseas, will soon be maintained in-country with tangible value-adds for the Nigerian economy,” said Babs Omotowa, NLNG’s managing director and chief executive officer at the investment forum held at the proposed site for the dockyard in Badagry. The dry dockyard became necessary, according to some observers in Nigeria’s maritime sector, due to the long absence of an operational dockyard to cater for very large crude carriers, VLCCs, and liquefied natural gas, LNG, carriers as existing dockyards could only handle smaller vessels. Lack of such facility, according to them, meant that owners of large vessels in Nigeria and some others in

West African region, have had to pay large sums of money for docking facilities located mainly in Asia, Europe and the Americas that can accommodate such large vessels.

More vehicles, houses using gas in Tanzania

ore than 60 vehicles7 and 70 houses are now using natural gas while 300MW of electricity is being generated from natural gas in Tanzania, according to the government. Acting Manager of Gas Supply Company, GASCO, which is under TPDC, Mr Kapuulya Musomba, stated this in Dar es Salaam while giving a report on the implementation of the project from Madiba-Mtwara, Songosongo-Lindi and Coast to Dar es Salaam. The more than 500-kilometre pipeline project from Mtwara to Dar es Salaam launched in 2012 will have the capacity to transport 784 cubic feet of gas per day, which will generate 3,920MW of electricity. The country's current demand is 720 MW per day. By generating 3,920MW through domestic gas reserves, the country would have a surplus of more than 3,000MW. The project's cost is Tsh1.86 trillion (USD1.2 billion) and is funded by a loan from the Export-Import Bank of China. The construction plan involves building a 36-inch pipeline for 487 kilometres and a 24-inch pipeline for 24 kilometres, connecting the mainland to the gas source on Somanga Fungu, a small island in the Indian Ocean. Meanwhile, more than 90 per cent of the work on the construction of the Mtwara-Dar es Salaam pipeline has been completed, costing 1.225bn/- so far.

Power

2015 January, SweetcrudeReports

Transition Electricity Market to take off February 1 KUNLE KALEJAYE

fter initially fixing the take off date of the Transition Electricity Market, TEM, for this January 1, the Federal Government has now rescheduled the date to F e b r u a r y 1 . SweetcrudeRepoorts gathered that the change was due to the fact that some of the power firms expected to benefit from the N213 billion Nigerian Electricity Market Stabilisation facility provided by the Central Bank of Nigeria were yet to secure Letters of Credit, LCs, required to enable them access fund. A source at the Presidential Task Force on Power in Abuja said the TEM take off was also stalled because gas producers, who will supply gas to power generating plants, were insisting that LCs with 12-month duration be posted to their banks before the Gas Supply Agreements, GSAs, with the generating companies would be activated. Minister of Power, Professor Chinedu Nebo, who announced the initial date of January 1 in Abuja, had said it is an effective date for the take-off of all contractual obligation at a time when the nation's electricity market is flourishing. According to the minister, the main focus of TEM will be the consummation of all contractual obligations as stipulated in the rules. The

TEM declaration is not the start of the transition, but an attempt to make the market more matured and robust, he stated. Nebo, therefore, called on all actors to do their beats, just as he promised a level playing ground, insisting that government would not accept any excuse for the inability of all actors to provide Nigerians with uninterrupted power supply. He disclosed that the Central Bank was ready, hence all market participants should perfect their papers in order to access cheap fund under the governmentâ&#x20AC;&#x2122;s intervention initiative.

Transmission pylons

Abuja Disco, he said, has the capacity to use 700MW if available on the national grid, but is getting a paltry allocation of 285MW, being consumed at the ratio of 80% for the metropolis and 20% to adjoining states and satellite settlements Professor Nebo also expressed government's determination to radically address the lingering metering-gap existing in the power sector, saying this would help block leakages thereby making more resources available for i n v e s t m e n t .

The minister, who spoke about the negative impact of vandalism on power generation, said he and his counterpart in the Ministry of Petroleum Resources had perfected plans to stem this ugly tide. He also spoke about plans to increase power generation

through access to gas by plants built under the National Integrated Power Project, NIPP, and to enhance transmission capacity. The government, he said, would also pursue with vigour energy efficiency and conservation initiatives. Permanent Secretary in the Ministry of Power, Ambassador Godknows Igali, harped on the need for the power distribution companies to be more innovative in their load shedding arrangement and said companies should manage scare resources by shutting out electricity supply in offices at night while homes will have their turn in the day time. Speaking on behalf of power distribution companies, Ernest Mupaya of Abuja Disco, said his company has invested heavily in

infrastructure aimed at improving service delivery. He said the company now has an integrated payment platform for settlement of bills for improved customers interaction. Abuja Disco, he said, has the capacity to use 700MW if available on the National grid, but is getting a paltry allocation of 285MW, being consumed at the ratio of 80% for the metropolis and 20% to adjoining states and satellite settlements. Promising that with more energy available to the company, more would be made available to customers, Mupaya said the company is already working with Independent Power Producers that will harness vast solarpowered energy source and other power embedded projects, so that less emphasis would be on the grid.

2015 January, SweetcrudeReports

Power

Electricity consumers to face acute rationing soon …Power drops again to 3,000mw in two months

total of about 3,206.09mw was generated as at December 2, 2014 only to drop to 2,954.51mw by December 11, a reduction of 251.58mw in nine days. The Senior Special Adviser to the Minister of Power, Mr. Frank Edozie, however, blamed the drop in power generation to sabotage of pipelines and inadequate gas supply. Edozie, who disclosed this in a telephone interview said the epileptic power supply being experienced across the country was caused by recent vandalism of Trans-Forcados pipeline that transported crude oil.

OSCARLINE ONWUEMENYI

he Transmission Company of Nigeria, TCN, has announced t h a t t h e maximum generated electricity available for it to transmit for distribution across the country has dropped to 3,000 megawatts, MW

He said, “Inadequate gas supply and frequent sabotage of the pipelines had contributed immensely to lack of electricity supply in t h e c o u n t r y . “We are constrained due to the gas challenges and it has contributed to the drop of power generation to 3,500 m e g a w a t t s ” . The senior special adviser said that available power generation capacity currently stood at 6,000 mega watts while system capacity stood at 5,000 mega watts

This it blames on the vandalism of Nigeria’s key gas pipeline, the TransForcados gas pipeline, saying it has resulted to a drop of available maximum distributable megawatts of electricity nationwide to 3,000mw. According to a statement signed by its Assistant General Manager, Public Affairs, Mr. Dave Ifabiyi, in Abuja, the drop will call for regular supply rationing because gas supply to three key power generation companies, Egbin, Olorunsogo and Geregu, has been affected with the development. The TCN statement said the unexpected drop in power generation has resulted in the country’s electricity generation which averaged about 4,500mw in recent times dropping by nearly 1,500mw. Only last month, there were reports of unexpected and sharp decline in power generation across the country. Reports from the Ministry of Power website showed that the national electricity generation had dropped to 2,954.51mw in the early weeks of December 2014, putting a lot of pressure on available power. According to the website, a

Edozie said that the real challenge of epileptic power supply was caused by gas i n a d e q u a c y .

Lagos at night

The TCN statement said the unexpected drop in power generation has resulted in the country’s electricity generation which averaged about 4,500mw in recent times dropping by nearly 1,500mw.

Power Tariff: NERC extends planned increase for residential consumers

he Nigerian Electricity Regulatory Commission, NERC has extended the planned increase in tariffs for residential consumers to June this year while revised charges for other classes of consumers have taken effect from January 1. Addressing the media at the NERC secretariat in Abuja, the chairman of the commission, Dr Sam Amadi, said the freeze in charges for residential consumers, who constitute about 80 per cent of the electricity consumers, was aimed at promoting the interest of consumers as well as stimulate operators to serve consumers better.

Dr Amadi expressed worries over the rate of meter deployment by electricity distribution companies in-spite of the credited advancement payment initiative. Since private companies took over ownership of some unbundled government stake in the power sector, new owners have said they needed to increase tariff in order to meet the needed increase in generating capacity of the plants. Said Dr Amadi: “You may recall that after a recently conducted special review, NERC approved a revised Multi Year Tariff Order 2.1, which came into effect on

January 1, 2015. “A major highlight of the MYTO 2.1 is a six-month freeze from January 1, 2015 on tariff increase for residential consumers, who constitute about 80 per cent of the electricity consumers, known in the industry as R2 customer class, in the country.” Asked if there would be an increase in electricity tariffs for residential consumers at the expiration of the six months, Amadi said the outcome of the minor electricity tariffs review to be held during the period would determine if the rates would be hiked.

Power

2015 January, SweetcrudeReports

TCN wheels 4,389mw in December

Power sub-station KUNLE KALEJAYE

he Transmission Company of Nigeria, TCN, says it wheeled 4,389 megawatts of electricity in December 2014, accounting for an increased supply in the country for the yuletide s e a s o n . R e s p o n d i n g t o SweetcrudeReports' text message, TCN's General Manager, Public Affairs, Seun Olagunju confirmed the increased in power transmitted in December. She said, "Yes, TCN transmitted more power. According to the System Operator, TCN had a peak of 4,389MW wheeling in December 2014.”

electricity official, is due to the closure of industrial companies for the year.

to SweetcrudeReports' text message, said factories did not operate in full capacity.

Power plant, Engr. Mike Uzoigwe, who also responded

generation of 3,646.80mw as at 4th of January, 2015.

In Lagos, SweetcrudeReports "Electricity meant ‎ for He response: "Consumers checks revealed that the two industrial areas in the travelled out of Lagos. country was evenly Factories not operating at distribution companies, Eko and distributed to residential full capacity toward end of areas for the yuletide period," year. Therefore, available Ikeja DISCOs, distributed more an electricity official said. power could go round easily.” electricity to residential areas in Also confirming the However, six days into 2015, increased power supply, power supply dropped by December. Managing Director of Egbin 740mw with a peak

Gombe spends N558.7m on rural electrification Local Government Areas. The Commissioner for Rural Development and Cooperatives, Mr Hassan Ahmadu, told journalists in Gombe that the electricity in the affected communities was upgraded from 3KV to 11KV at N125.349 million.

She, however, decried the negative impact of gas pipeline vandalism, describing it as "a huge challenge.” I n L a g o s , SweetcrudeReports checks revealed that the two distribution companies, Eko and Ikeja DISCOs, distributed more electricity to residential areas in D e c e m b e r . The reason for the increased distribution of power to residential areas, according

Rural electrification

he Gombe State Government has said it had spent

N558.6 million on the electrification of rural communities in Gombe, Billiri and Yamaltu/Deba

He said 23 villages were covered by the project in Billiri LGA at the cost of N341.9 million, while the scheme gulped N91.9 million in Kagarawal Local Government Area

and adjoining communities. Ahmadu said the provision of electricity in Kagarawal Village, described as den of criminals, would reduce the influx of miscreants to the area. The commissioner said the provision of electricity would also reduce ruralurban migration. “We also want them to feel and touch the dividends of democracy,” the commissioner said.

2015 January, SweetcrudeReports

Power

Electric transformers

Eko Disco says N200m transformers will stabilise power supply â&#x20AC;ŚBEDC installs 36,000 prepaid meters

he Eko Electricity Distribution C o m p a n y , EKEDC, has purchased 40 new distribution transformers as part of efforts to boost power supply in its area of coverage. Principal Manager, Public Affairs Department, Mr. Ademola Adegoke, quoted Managing Director of the company, Engineer Oladele Amoda, as putting the cost of acquisition and installation of the transformers at N200 million. According to him, the new transformers would ensure that customers experienced steady supply of electricity and prevent prolonged outages as a result of faulty equipment, especially in the season of Christmas and New Year. â&#x20AC;&#x153;The EKEDC would continue to make optimal service delivery and customer satisfaction the centre-piece of its operations and activities. It reassured customers that all the eleven

business districts of the company would benefit from the installation of the new transformers," Adegoke said. He added that in addition to the injection of the 40 new transformers to the network, the company would soon introduce many other programmes to improve its service to customers. In a related development, the Benin Electricity Distribution Company, BEDC, has said it installed a total of 36,000 pre-payment meters in the last one year. BEDC's Executive Director, Commercial, Mr. Abu IsmailEjoor, said, in a presentation to stakeholders at a meeting convened at the instance of the Nigerian Electricity Regulatory Commission, NERC, on the Credited Advanced Payment for Metering Implementation, CAPMI, in Benin, Edo State, said within the last one year, not less than 36,000 prepayment meters had been installed across the company's area of operation.

The figure, representing an average of 3,000 per month, according to him, has gone to bridge the metering gap and eliminate estimated billing from its billing platform. The executive director stated that even though the company was eager to see that more meters were installed within the statutory 45 daysâ&#x20AC;&#x2122; time frame provided under CAPMI, this had ben hampered by customers that filled untraceable home addresses while making their meter applications, thereby making it difficult to meter such customers. He stated that within the first quarter of 2015, it was the intention of BEDC to migrate all its customers on the pre-payment meters to online real-time vending system, which would allow its customers to purchase electricity tokens round the clock. The commissioner in charge of Engineering, Standards and Safety at NERC, Mrs. Mary Awolokun informed the

The EKEDC would continue to make optimal service delivery and customer satisfaction the centre-piece of its operations and activities. It reassured customers that all the eleven business districts of the company would benefit from the installation of the new transformers

gathering, on behalf of the chairman of NERC, Dr. Sam Amadi, that the commission was conducting a nationwide tour of all distribution companies to meet directly with the customers and get their feedback as regards the CAPMI implementation in

a l l t h e D i s c o s . She said the commission was making all efforts to see that meters are made available to customers under the advanced payments scheme within the statutory 45 days allowed by the commission for all Discos to do so.

2015 January, SweetcrudeReports

Power

A broken gas pipeline

'Pipeline sabotage, gas shortage still challenge to power supply’

enior Special Adviser to the Minister of Power, Mr. Frank Edozie, says pipeline vandalism and shortage of natural gas to power electricity generating stations are still a major challenge to government's plan to ensure regular power supply nationwide. Edozie specifically blamed the recent drop in power generation to sabotage of pipelines and inadequate gas supply, stating that the ongoing epileptic power supply being experienced across the country was caused by recent vandalism of the Trans-Forcados pipeline that transported crude oil and gas. “Inadequate gas supply and frequent sabotage of the pipelines had contributed immensely to lack of electricity supply in the country. We are constrained due to the gas challenges and

it has contributed to the drop of power generation to 3,500 megawatts,” he said. The senior special adviser, who maintained that available power generation capacity currently stood at 6,000 mega watts while system capacity stood at 5,000 mega watts, said the real challenge of epileptic power supply was caused by gas inadequacy. Reveaking that power generation as at today stood at 3,500 megawatts, Edozie said: “We have not gone below that but we are gradually beefing up the generation to hit 5,000 mega watts as promised.” The Transmission Company of Nigeria, from which the power distribution companies source electricity, has the capacity to transmit 6,000MW. The Federal Government planned to generate 5,000MW in 2014. As at the end of 2014, this

The senior special adviser, who maintained that available power generation capacity currently stood at 6,000 mega watts while system capacity stood at 5,000 mega watts, said the real challenge of epileptic power supply was caused by gas inadequacy.

plan remained a mirage. By mid-December, reports from the Ministry of Power website showed that the national electricity generation had dropped to 2,954.51MW, putting a lot of pressure on available power. According to the website, a total of about 3,206.09MW was generated as at December 2, 2014 only to drop to 2,954.51 by December 11, a reduction of 251.58MW in n i n e d a y s .

Ghana to boost power generation

hana’s Volta River Authority, VRA, is set to improve its power generation capacity following receipt of a whopping $450 million from Africa Export-Import Bank, Afreximbank. VRA Chief Executive Officer, Kirk Koffi, confirmed that out of the funds, $150 million would be readily available in the country in January 2015 for the purposes of boosting Ghana’s power generation efficiency as well as assist the power utility convert its short term loans on its balance

sheet to medium term. “We need to add on more thermal generations and it takes more money to fund thermal generations,” he said, adding that “because of the current bad status of our balance sheet, it’s good that we do this,” Koffi said. He said the outstanding $300 million would also be available in January for the purposes of boosting power generation at the main generator.

2015 January, SweetcrudeReports

Power

IKEDC upgrades system for efficient bills payment

IKEDC office KUNLE KALEJAYE

he Ikeja Electricity Distribution Company, IKEDC, says it has upgraded its system to enable both prepaid and post-paid customers within its network to make payments with ease. Customers can now do this through vouchers, point-of-sale terminals, nearest bank branch, online banking portals as well as the company's website. In a statement made available to SweetcrudeReports, the company said the upgrade has facilitated the alignment of payment options within its network, a development that has invalidated previous payment options. According to IKEDC Managing Director Abiodun Ajifowobaje, the new payment platform is in collaboration with First City Monument Bank Plc, United Bank for Africa and Nigeria Inter-Bank Settlement System Plc, NIBSS. Working with these financial institutions, Engr. Ajifowobaje

explained, will ensure post-paid customer accounts are credited promptly, avoiding unplanned service interruptions while prepaid customers are provided m o r e c o n venient vending channels. Ajifowobaje said: â&#x20AC;&#x153;The upgrade is a result of a comprehensive study of our network which was geared towards ensuring that customers have seamless payment options. The new regime has eradicated any likelihood of wrong entries or delayed confirmation of payments by customers. "As long as the customers pay with our Ikeja Electric vouchers, at approved POS terminals agents, via NIBSS eBillsPay at b a n k b r a nches or online banking channels, the transaction is effected in almost real time," he said A breakdown of the payment options for prepaid and postpaid customers includes POS machine which is widely available for all customers at all Ikeja Electric business locations, service centres, agents locations and shops with

Ikeja Electric signage on display. Others include recharge cards vouchers, internet banking platforms with the following banks: Diamond, FCMB, Fidelity, Enterprise bank, Guaranty Trust Bank, Keystone bank, Mainstreet bank, Skye bank, Unity bank, Union bank, Wema bank and Zenith bank.

Chinese solar systems to light up rural Ethiopia

thiopia's Ministry of Water, Irrigation & Energy, MoWIE, through its Rural Electrification Fund, REF, has procured 11,488 solar home systems, SHS, from the Chinese Company Cecep Oasis New Energy Company, which are expected to be delivered within three weeks. The IDA provided the financing, a total of 2.8 million dollars, for the purchase of the systems which will be distributed to 11, 488 households that are members of the 207 cooperatives in the regions. At different times previously,

the ministry had procured and distributed institutional solar systems, says YisehakSeboka, the Rural Electrification Fund (REF) Coordinator at the Ministry. The first was in 2006 when 200 health posts received these systems. Out of these systems, Afar received seven, Somali 14, BenishangulGumuz four, Southern Nations, Nationalities and Peoples Region 37, Harari two, Amhara 49, Tigray 14 and Oromia 69. Then the Ministry distributed 100 institutional solar systems to 100 schools around the country.

The ministry used 918,388 dollars of GEF grant to buy 270 institutional solar systems from Zhejiang Holly International Co., Ltd; these were distributed to as many schools. After that the Ministry bought 345 institutional solar systems from the Indian M/S Lucky Export using 1.6 million dollars of GEF grant; these were distributed to 345 health institutions. The IDA, too, had supported the home system in a much larger scale, providing 10.4 million dollars.

Finance

2015 January, SweetcrudeReports

Electricity workers

World Bank to spend $1.7bn on Nigeria's power sector

he World Bank would over the next four years spend $1.7 billion (about N294 billion) on the Nigerian power sector, according to the Bureau of Public Enterprises, BPE. A statement in Abuja by the H e a d , P u b l i c Communication at BPE, Mr Chigbo Anichebe, quoted World Bank's Country Energy Task Team Leader for Nigeria, Mr Eric Fernstrom, as disclosed this at a capacity building programme on post privatisation monitoring for the power sector. According to the statement, the programme was jointly organised by the bank and the enterprise to ensure that the reform objectives were

realised. This, it stated, was due to the transparency exhibited in the transaction process and the robust post reform measures put in place by the National Council on Privatisation, NCP. It quoted Fernstrom as saying that the 1.75 billion dollars was 25 percent of a total 7 billion dollars earmarked for Nigeria in the next four years. It said the workshop, which was held in Uyo, was to expose participants to the techniques, methods and information sources for effective Post Privatisation Monitoring and Evaluation of PHCN successor companies. "It was also meant to enable participants to analyse performance targets, using relevant tools as well as expose them to strategies for effective

e n g a g e m e n t a n d collaboration with relevant stakeholders. "It attracted participants from critical sector stakeholders, including the

Nigeria Electricity Regulatory Commission, Presidential Task force on Power, Transmission Company of Nigeria," it stated.

The statement also reported the DirectorGeneral of BPE, Mr Benjamin Dikki, as saying that the workshop had greatly increased the capacity of the participants to effectively monitor power companies. Dikki also expressed gratitude to the World Bank for its continued support to the enterprise over the years and for sponsoring the programme.

AfDB votes $500m for Nigeria's Development Bank

he African Development Bank, AfDB, would be providing a financial package of 500 million dollars to support the establishment of the Development Bank of Nigeria Plc, DBN. This follows an approval to this effect by the group's board of directors. Specifically, the financial package consisted of loans of 450 million dollars and an equity investment of 50 million in the DBN. A statement by the bank in Abuja said the funds from the AfDB Group would be used to

support Micro, Small and Medium-sized Enterprises, MSMEs, operating in various sectors of the Nigerian economy. "The DBN is being established by the Federal Government of Nigeria in partnership with international development financial institutions such as the AfDB, the World Bank, KfW of Germany and the French Development Agency (AFD)â&#x20AC;?.

2015 January, SweetcrudeReports

Finance

First Bank returns as duty collector for Customs

he Nigeria Customs Service, N C S , h a s unblocked and reinstated the First Bank of Nigeria Plc as its duty collecting bank. The development follows a detailed debt recovery plan by the service, the NCS Public Relations Officer, Mr Wale Adeniyi, said in a statement in Abuja. The statement said that the bank was suspended from duty collection due to the failure of its customers to redeem a bond amounting to N3.64 billion secured by the bank. It said that the ComptrollerGeneral of Customs, Alhaji Dikko Abdullahi, directed the immediate reinstatement of the bank following his satisfaction with the recovery plan brokered by Asset Management Corporation of Nigeria, AMCOM. The statement said that Abdullahi had directed importers and agents to resume duty payment transactions with the bank. According to it, the service will continue to recognise properly entered bonds as a tool for trade facilitation. It warned that any abuse of the process from any individual or organisation would no longer be tolerated. The statement explained that the bank’s customers, Messrs Onome Jack Up Service Limited and Oritsetimeyin Jack Up Service Limited, failed to redeem the N3.64 billion bond secured by the bank. “Satisfied with the recovery plan which involves the intervention of Asset Management Corporation of Nigeria (AMCON), the CGC, Dikko Abdullahi, has directed the immediate reinstatement of First Bank Plc as customs duty collecting bank," it said. In another development, the Tin-Can Island Port Command of the NiCS said it collected N22.3 billion revenue in November 2014 The Public Relations Officer of the command, Mr Chris Osunkwo, said the amount was less than the N27.1 billion collected in October,

attributing the decrease to the forces of demand and supply. He said: "In October, we made approximately N27.1 billion, whereas in November we had N22. 3billion. A lot of factors are responsible for the difference, particularly the forces of demand and supply. “When you try to find out

from the traders, they tell you that trading activities are at their lowest ebb because they observed that the people’s purchasing power dropped and as such, their warehouses are still filled up. “You will have to sell and realise money to be able to

come and clear or you import fresh ones. The level of compliance is gradually improving because we just celebrated the first anniverssary of PAAR (PreArrival Assessment Report). “PAAR just clocked one on Dec. 1, and among the things PAAR is here to achieve is to

make the trading public become more compliant. “If you are honest, you give appropriate and accurate information without trying to cut corners, definitely, you will have everything going for you.” A breakdown of the revenue showed that in November, the command raked in N18.1 billion into the Federation Account and N4.1 billion into the Non-Federation Account.

Containers at port

NLNG pays $30bn dividend to shareholders in 15 years KUNLE KALEJAYE

General Manager, External corporate tax payer in the Relation at NLNG, Kudo c o u n t r y . T h e a m o u n t he Nigerian Liquefied Natural Eresia-Eke, stated in a accounts for some five per Gas, NLNG, Limited has in the r e c e n t s t a t e m e n t t h a t cent of the government’s last ‎ 15 years paid $30 billion as besides the dividend to revenue, " the statement dividend to its shareholders, including shareholders, the company said. the Federal Government, represented had last year also paid Describing these as part of by the Nigerian National Petroleum Corporate Income Tax of the NLNG success story, Eke N 2 2 0 b i l l i o n t o t h e in the statement said Corporation, NNPC. The Federal Government is the government. "NLNG’s success is "NLNG had earlier this particularly commendable largest single stakeholder in the company with 49 percent interest, year (2014) paid Corporate because its world-class other shareholders being Shell Gas BV Income Tax, CIT of N220 international operations are (25.6% interest), Total LNG Nigeria billion to the Federal run on a day-to-day basis by Limited (15%), and Eni International Government of Nigeria, a senior management team b e c o m i n g t h e l a r g e s t that is 100 percent Nigerian. (10.4%).

2015 January, SweetcrudeReports

Finance

Naira notes

Naira devaluation aimed at encouraging local industries, boosting GDP —PHCCIMA MKPOIKANA UDOMA

he Port Harcourt Chamber of Commerce, Industries, Mines and Agriculture, PHCCIMA, says the recent devaluation of the naira by the Central Bank of Nigeria, CBN, is not against the interest of Nigerians, but is aimed at encouraging local industries in a bid to boost the country’s gross domestic product, GDP. President of PHCCIMA, Engr. Emeka Unachukwu, stated these while fielding questions from newsmen in Port Harcourt. According to him, “The devaluation of the naira is a classical economic theory, because when you want to discourage the taste for foreign goods, when you want to discourage import, when you want to encourage exports and manufacturing, devaluation of a currency is a classical fiscal policy to take. "It is not in the bad interest of Nigerians because they are forcing you to look inwards, so it’s a temporary thing because as soon as you start manufacturing locally, your GDP will grow and immediately the currency

will appreciate”. The PHCCIMA boss also reiterated that the chamber was giving out loans of up to N15 million without collateral and at low interest, to encourage SMEs in the state. “We decided to tackle the most gruesome of this challenges which is access to finance. We are happy to announce that through our PCS3 scheme (PHCCIMA Credit Support Scheme for SMEs), we can give collateralfree loans up to N15 million at low interest rate and minimum duration of three years. It is important to inform that this programme has earned us international recognition and nomination from the World Chamber of Commerce to compete in the Best City Chamber of the

World for 2014. “We have also remained socially responsible for partnering with the RSSDA on our award winning GWEPS, (Graduate Work Experience, Placement Scheme to reduce graduate unemployment in Rivers state” he said. Earlier, the Vice President of the Nigerian Chamber of Commerce, Industries, Mines and Agriculture, Mr. Prince Billy-Gillis Harry, called on the government to assist in ensuring that the Port Harcourt trade fair achieved international status as trade fair centre for oil and gas. “In the four regions in the country, there are designations for trade fairs.

The devaluation of the naira is a classical economic theory, because when you want to discourage the taste for foreign goods, when you want to discourage import, when you want to encourage exports and manufacturing, devaluation of a currency is a classical fiscal policy to take

For instance, in the North is agriculture, for the West it is commerce, for the East, they have made-in-Nigeria goods and for the South South it is oil and gas, but that potential

has not been fully harnessed by international status. We are looking forward in the future where government should make more efforts to ensure that we realise these objectives.” he said.

Capital Market: Why SEC extended capitalisation deadline to September

he Securities and E x c h a n g e Commission, SEC, may have acted due to pressure in its recent decision to extended the deadline for minimum requirement for all capital market operators to September 30, 2015. The extension came on the heels of pressure by capital market operators that the deadline be shifted due to the ongoing uncertainties in the country that hampered market growth and development. As part of the pressure, the commission had been battling with the Chartered Institute of Stockbrokers and the A s s o c i a t i o n o f Stockbrokers Houses of Nigeria, ASHON, over the the matter.

SEC recently announced the extension in a statement pasted at its web site. It stated that the approval was given on December 22 at the commission's board meeting following a review of the status report on the level of compliance by capital market operators. "The board expressed satisfaction with the efforts made by all operators, particularly those who have complied with the new requirements. "The board, however, took cognisance of the effect of the global economic situation and approved an extension of the deadline for compliance with the new minimum capital requirements by nine months, to 30th September 2015, " the statement stated.

2015 January, SweetcrudeReports

Finance

he Nigerian Stock Exchange, NSE, says there was the need for s t r o n g regulatory environment to enhance investors’ confidence in the nation's bourse. The Chief Executive Officer of NSE, Mr Oscar Onyema, made the assertion at the recent two-day workshop organised by the Capital Market Correspondents of Association of Nigeria, CAMCAN, in Lagos. Onyema, who was represented by Mr Bola Adeeko, NSE’s Head, Corporate Services, said that a stronger regulatory framework would protect investors against infractions. He stated that the framework would ensure a safe investment destination for local and foreign investors and a favourable business environment for companies to thrive. According to Onyema, the NSE had made great strides in its transformation journey, including review in market governance, structure and operations. "We have worked tirelessly to revise key rules for dealing members and issuers. We have developed several new rules to create the much needed order, equitable treatment, efficiency and protection for all participants in our market," Onyema said. He commended the Securities and Exchange

NSE says stronger regulatory measures will boost investors' confidence

Floor of the Nigerian Stock Exchange Commission, SEC, for supporting and approving its compliance measures aimed at strengthening the capital market. Onyema said that its compliance measures were supported by tight

enforcement procedures, which included inspections, market surveillance and a vigorous penalty system. He said that the exchange had reinvigorated its Investor Protection Fund to reduce losses investors

might suffer due to bankruptcy, insolvency, negligence or wrong-doing by a dealing member. Onyema said that the NSE was committed to developing a more transparent, liquid and accessible market to

'Nigeria-India trade volume hits $17bn’

he trade volume between Nigeria and India reached 17 billion dollars from April 2013 to March 2014, India’s Acting High Commissioner in Nigeria, Kaisar Alam, has said. Alam said in Abuja that India imported 14 billiondollar worth of goods from Nigeria during the year while Nigeria imported three billion-dollar worth of goods from India in the same period. He explained that India was currently the largest importer of Nigeria’s crude oil, importing 12 billiondollar worth of the product in the year under review.

"India imported 14 billiondollar worth of goods from Nigeria from April 2013 to March 2014, including 12 billion-dollar worth of crude oil,’’ he said. He also explained that with the reduction of U.S. import of Nigeria’s crude oil, India was currently Nigeria’s largest trading partner. According to him, a large number of Indian companies and businesses have footprints in Nigeria, which have made substantial investments in Nigeria. The envoy explained that the increasing trade relations between the two countries would boost trade volume in 2014-2015 fiscal year.

He said that the relations between the two countries had always been friendly, noting that ``Nigeria is a very important country to

India.’’ He expressed the optimism that the bilateral relations between Nigeria and India would improve significantly in the current year.

India imported 14 billiondollar worth of goods from Nigeria from April 2013 to March 2014, including 12 billion-dollar worth of crude oil

support the delivery of a wider range of investment products. He said that the market regulators would ensure c o n t i n u o u s engagement of all stakeholders to sustain the capital market growth and development. "While investors’ confidence is slowly being rebuilt, we still have a long way to go and many challenges to overcome. “It is our hope that we will continue to play our various roles in the transformation of the Nigerian Capital Market. We hope that these measures will lead us to an all-round market improvement in 2015," Onyema said.

2015 January, SweetcrudeReports

Finance

CBN head office, Abuja

he Central Bank of Nigeria, CBN, has put Nigeria's foreign exchange reserves at 34.49 billion dollars (N5.74 trillion) as at January 5. In the foreign exchange reserves data posted on its website, CBN said the figure represents an increase of 20 million dollars (N3.36 billion) from the 34.47 billion dollars (N5.79 trillion) recorded on December 31, 2014.The bank said that the 34.49 billion dollars (N5.74 trillion) represented the ‘gross’ amount while 33.52 billion dollars (N5.63 trillion) was ‘liquid’ and 975 million dollars (N163.8 billion) ‘blocked’. The Federal Government had through fiscal policies made attempts since 2013 to shore up the foreign reserves to 50 billion dollars (N9.05 trillion).The CBN had in 2014 relied heavily on external reserves to support the naira which came under pressure following falling international prices of crude oil. Crude oil prices at the international market have continued to rally between 55 dollars and 60 dollars per barrel since December, 2014. According to the CBN, the continuous pressure on the

Nigeria's foreign reserves now $34.49bn …Ministry clarifies management of national reserve In spite of the government’s efforts to shore up the naira, the CBN devalued the naira to N168 to a dollar in November. In another development, the Federal Ministry of Finance said President Jonathan's administration did not in anyway squander the national reserve foreign exchange market was also attributable to the rise in the internal demand for the dollar. The CBN Governor, Mr Godwin Emefiele, had earlier said that the country had spent huge assets from the foreign reserves in ensuring that the official exchange rate was maintained at its previous value of N155 to a dollar. In spite of the government’s efforts to shore up the naira,

the CBN devalued the naira to N168 to a dollar in November. In another development, the Federal Ministry of Finance said President Jonathan's administration did not in anyway squander the national reserve. This is contained in a statement issued by the ministry in Abuja. "It is absolutely not true that the

administration of President Goodluck Jonathan has squandered the nation’s reserves. "The facts are clear and indisputable. At the end of May 2007, Nigeria’s gross reserves stood at 43.13 billion dollars, comprising the CBN’s external reserves of 31.5 billion dollars, 9.43 billion dollars in the Excess Crude Account (ECA) and 2.18 billion dollars in Federal Government’s savings. "These figures can be independently verified from the CBN’s records," it said. According to the statement, the figure of 67 billion dollars cited in some recent commentary is factually incorrect. It added that it was a misconception to think that reserves are immutable or cast in stone. It added that since May 2007, the reserves had fluctuated in line with

developments in the international oil market, rising from 43.13 billion dollars at that time, peaking at 62 billion dollars in September 2008 during the Yar’adua and Jonathan's administration. It said that then, the oil prices reached a peak of 147 dollars per barrel, and falling subsequently to as low of 31.7 billion dollars in September 2011. It added: "This fall in reserves was largely a result of the vicissitudes of the global economy and oil market which caused the CBN to intervene, using some of the reserves, to defend the value of the naira. "The Excess Crude savings, which it should be noted is a component of the reserves, was largely used to cushion the economy at the height of the global financial crisis in 2008-2009.

Labour

2015 January, SweetcrudeReports

Petroleum refinery

Stimulate local refineries in 2015, PENGASSAN tasks Govt

he Petroleum and Natural Gas Senior Staff Association of N i g e r i a , PENGASSAN, has urged the Federal Government to demonstrate commitment to stimulating local refining of crude oil in 2015. The General Secretary of the union, Mr Bayo Olowoshile, made this known in Lagos that only domestic refining would end crises in the oil and gas sector. "The key focus of the government in 2015 should be to stimulate local refining of petroleum, white products and petrochemical products. "Domestic gas production for energy, industry, agricultural and automotive purposes should be given ultimate attention in the New Year," Olowoshile said.

The PENGASSAN scribe said that the government should cut the rate of importation of products by 50 per cent. "Job creation and manpower

utilisation should also be a priority of the government at such time like this when crime rate has increased. "Many of our present challenges are tied to

29 Olowoshile said that a slice in importations of products would not only stabilise the economy but also create millions of job to unemployed youths in the country. He said that importation of finished products into the country was a `canker worm’ that had l e f t m a n y Nigerians jobless. According to him, government should boost local c a p a c i t y development and curb idleness in the country. Olowoshile urged government to halt capital flights in the New Year to save enough m o n e y f o r infrastructure and socio-economic development of the nation. The oil workers’ leader urged the government to do everything possible toward e n s u r i n g restoration of national peace and tranquility.

unemployment and government’s inability to channel the youthful strength of our young people into productive activities," he said.

Naira Devaluation: TUC to demand new minimum wage

he Trade Union Congress, TUC, said it would demand for wage increase for workers this new year, following the devaluation of the naira by the Central Bank of Nigeria. The National President of the Congress, Alhaji Bobboi Kaigama, disclosed this at the end of the Congress’ national executive council meeting in Lagos. Kaigama said wage hike had become necessary because the current devaluation had started impacting negatively on Nigerian workers. He added that "the issue of wage is a dynamic thing. In stabilised economies, wages are directly proportional to the inflation trend of that country. "So, it is expected that following the devaluation of the naira and its resultant rise in inflation,

salaries of workers should automatically be increased too. "But in this country, even after devaluation of the currency, there will not be any increase in workers’ salary and that is bad. The moment devaluation is put in place the prices of goods and services surge, there should be a proportional increase in the workers’ pay.’’ He, therefore, said "if the issue on devaluation persist, the Congress will have no option but to enter the New Year with a demand for increase in workers’ pay." The TUC boss added that the fall in crude oil price in the international market should be translated into a fall in the price of refined products in the country. Kaigama explained that the price of petrol should be brought down to N50 per litre.

2015 January, SweetcrudeReports

Labour

NUPENG Strike: Total clarifies position on worker's sack MKPOIKANA UDOMA

otal Exploration and Production Nigeria Limited, TEPNG, has debunked claims by the national leadership of the National Union of Petroleum and Natural Gas Workers, NUPENG, that its recent was in part designed to press “for the reinstatement of the National Zonal Secretary of the Petroleum and Natural Gas Senior Staff Association of Nigeria, Mrs. Evo, who was sacked by Total E&P Nigeria Ltd”. Total E&P, in a statement issued by its Deputy General Manager on Policy, Media & Coordination, Mr. Charles Ogan, explained that Mrs. Elo breached the terms of her employment with Total, hence the termination of her ap pointment, which is contrary to the claims by the National President of NUPENG, Mr. Igwe Achese, that Mrs. Evo was unduly sacked. According to the statement, “Following a routine corporate reorganisation, 71 employees from Port Harcourt and Abuja, including Mrs. EV-O, were given letters of transfer to Lagos in August, 2014. Mrs. Evo received a transfer and inconvenience allowance of more than Nine Million Naira and then refused to transfer to her new location”. The statement continued: “Instead of approaching the company in which she was an employee, to re-consider her transfer, Mrs. Evo complained to a number of external parties and agencies and invited them to intervene in a routine internal employer-employee matter. She sought to force a reversal of the transfer, citing her role as a Port Harcourt Zonal official of the union”. “At the same time, Mrs. Evo absented herself from work without permission for over thirty days. Total had the option to summarily dismiss Mrs. Evo for refusing to proceed on transfer and/or for absenting herself for more than seven days without permission, both a

clear breach of the terms of her employment contract which she signed. Total E&P was magnanimous in waiting for thirty days before terminating her with full benefits even though she has not yet refunded the transfer allowance of over Nine Million

Naira”. “A labour dispute process was launched at the Federal Ministry of Labour by PENGASSAN who then declined to pursue this option. Total E&P supports this process which should be allowed to proceed to allow

knowledgeable third parties to review the facts and make an informed decision with the participation of all parties”. “PENGASSAN and NUPENG have been strong representatives of our employees for more than 35

years and we fully respect the rights of our employees to participate in union activities. We will continue to work with both unions in the interest of staff and the development of the oil and gas sector”.

Oil workers

NLC charges workers on productivity MKPOIKANA UDOMA

he Nigerian Labour Congress, NLC, Rivers State chapter, has charged workers in the state to be more productive in 2015. Acting Chairman of the NLC in the state, Comrade Williams Adah, gave the charge while exchanging views with newsmen in Port Harcourt. Comrade Williams expressed hope that the challenges confronting civil servants in the state would be adequately addressed, especially with the emergence of a new governor in forthcoming 2015 elections. According to him, “I am charging all workers in Rivers State to be productive, whether good or bad, we hope that in the shortest possible time the elections will come and go, and a new

governor will emerge, and all their (workers') rights and benefits will be given to them. Therefore, the more reason all hands must be on deck to move Rivers state forward”. The Rivers State NLC boss also revealed that labour was working on modalities to engage all governorship candidates in the state, in order to enable workers choose who would best represent their interest. “Labour in the state has actually put up plans to engage all the governorship candidates in the state for the interest of workers. We

are going to carefully look at the governorship candidates of the different parties, and we are also going to study the manifesto of each of the parties, then we would determine which party will have the interest of the workers at heart, so we could sensitise the workers to mobilise and vote for the party,” he said.

2015 January, SweetcrudeReports

Solid Mineral

2015 January, SweetcrudeReports

Truck-load of Iron rods

Transportation, major problem of Ajaokuta Steel â&#x20AC;&#x201D;Minister

ack of logistics to m o v e r a w materials to Ajaokuta Steel Company has been identified as a major problem facing the plant by Mr. Musa Sada, the "Now let us look at the first Minister of Mines and Steel The minister stated that phase of 1.3 million tonnes. this had become a big Development. For you to produce 1.3 million problem in the development Speaking in Abuja, the tonnes of steel, you need to of the steel sector, but minister said, being an transport materials six times maintained that the present integrated steel company, it that volume. required a lot of logistics to administration had made "So, you can imagine the efforts to address the transport raw materials to amount of materials you have challenges. According to the plant. â&#x20AC;¨ to move up and down. But him, a lot of units like the Sada said the concept of u n f o r t u n a t e l y t h e s e power plant, the rolling Ajaokuta was to produce 1.3 i n f r a s t r u c t u r e l i k e t h e mills, the lime plants, the million tonnes of steel railways and the rail limbs engineering works and the annually in the first, 2.6 in have not been developed", he m e t a l l u r g i c a l t r a i n i n g the second, and 5.2 in the said. third phases respectively. centre have been completed.

Sada said that all the units completed had been operational at one time or other and that raw materials like iron ore, cocking coal, limestone, dolomite and bauxite needed to produce steel, were in many parts of the country. The minister said the Federal Government had set up a committee to look at the infrastructure requirements of the country.

Oil downturn prompts US Steel layoffs

nited States Steel plans to temporarily i d l e i t s p i p e manufacturing plant in the state of Ohio and lay off 614 workers due to weak demand from the oil industry. The company sent a layoff notice to workers at the Lorain plant last week, citing weak

market conditions. "The company has suddenly lost a great deal of business because of the recent downturn in the oil industry," read a note posted by the United Steel Workers Union. "What appeared just a few short weeks ago as being a productive year... has most abruptly turned sour." The layoffs come as many North American oil and gas

companies have cut capital spending plans following a sharp fall in oil prices, which have more than halved since mid-2014. US independent Sanchez Energy was the latest company to announce such actions, saying on Wednesday that it would cut spending in 2015 by 60% compared to previously announced plans. That company also said vendors had lowered their prices. Services companies Schlumberger and Civeo have also laid off workers as operators cut costs. The layoffs at US Steel will begin on 8 March, a spokeswoman told Reuters.

"Most of these have been incorporated in the infrastructure master plan. The government has been tackling some of the problems, like the railways," he said as he noted that the ministry was collaborating with the Bureau of Public Enterprises to ensure that the privatised steel rolling mills began operation soon. The minister said the ministry had established a data base on steel production and operating companies to enhance policy formulation. He identified challenges facing the ministry as lack of legal and regulatory frameworks for the steel sector, illegal mining, smuggling of minerals and inadequate skilled manpower. Others are inadequate funding of the sector, low level of geosciences information for investment and inadequate mine site infrastructure to facilitate mineral resource development, among others.

2015 January, SweetcrudeReports

Solid Mineral

NEITI wants more transparency in extractive industry

xecutive Secretary, N i g e r i a Extractive Industries Transparency Initiative, NEITI, Mrs Zainab Shamsuna, has advised the country's extractive industry to embrace more transparency and accountability initiatives, to enhance Federal Government's revenue. Shamsuna, who was represented by Mrs Obiageli Onuorah, team leader of Outreach NEITI, gave the advice at a media interaction on Remediation and InterMinisterial Task Team, IMTT, activities in Abuja, organised by the Civil Society Legislative Advocacy Centre, CISLAC. She said absence of transparency by the extractive industries had resulted to loss of revenue into the government coffer. "The accounting system used by NNPC for equity crude is largely not automated, which creates difficulties for reconciliation of fund. "The NNPC cannot provide accurate audit with analysis of export crude debts due to lack of real time sales ledger. NNPC has no consistent practice regarding the point at which production is measured,’’ she said. According to her, NNPC paid fewer subsidies into the federation account between 2006 and 2008, while subsidy claims were N816.3 billion. She urged the media to partner with NEITI in releasing its mandate of a c h i e v i n g m o r e transparency in the extractive industry. However, Mr Barbs Pawuru, Chairman, Civil Society Steering Committee, said the committee on remediation had been working assiduously to identify remedial issues in the NEITI audit report with urgent recommendations. Pawuru said with the financial and technical support being received by the committee on remediation from the World Bank, It had developed two years working plan to address six priority remediation issues. He said the six prioritised

Steel industry remedial issues in its work plan, when addressed, would reduce the identified lapses in the revenue stream of the extractive industries into federation account.

"The Civil Society Steering Committee (CSSC) is the clearing house of NEITI, especially on remediation issues, needs to partner and engage with funding

agencies. "It has to address the six prioritised remediation issues within the next two years," he said. Pawuru said some of the

six prioritised remediation include weak arrangement around the domestic crude oil allocation, cloudy licences and leasing awards process and weakness arrangements for monitoring gas.

China continues to determine fate of global coal market

hina will continue to determine the fate of the global coal market in at least the next five years, according to the International Energy Agency, IEA. The agency revealed this in its recently-released annual Medium-Term Coal Market Report, where it also disclosed that global coal demand would reach 9 billion tonnes by 2019. The report came as Nigeria disclosed plans to commence work on three coal-fired power plants located across the country this year. Disclosing this in Abuja, the Minister of Power, Prof. Chinedu Nebo, said President Goodluck Jonathan would, all things being equal, flag off the construction work on the plants during the

year. Global demand for coal over the next five years will continue marching higher, breaking the 9-billion-tonne level by 2019, the IEA said in its report. The IEA report noted that despite China’s efforts to moderate its coal consumption, it will still account for three-fifths of demand growth during the outlook period. Moreover, China will be joined by India, ASEAN countries and other countries in Asia as the main engines of growth in coal consumption, offsetting declines in Europe and the United States. “We have heard many pledges and policies aimed at mitigating climate change, but over the next five years they will mostly fail to arrest the growth in coal demand,” IEA Executive Director Maria

van der Hoeven said. The Executive Director also called for more investment in high-efficiency coal-fired power plants, especially in emerging economies. “New plants are being built, in an arc running from South Africa to Southeast Asia, but too many of these are based on decades-old technology,” she said, as she expressed regret that the plants would be "burning coal inefficiently for many years to come.” The report noted that global coal demand growth has been slowing in recent years, and sees that trend continuing. It explained that coal demand will grow at an average rate of 2.1 percent per year through 2019. This compares to the 2013 report’s forecast of 2.3 percent for the five years through 2018 and the actual growth rate of 3.3 percent per year between 2010 and 2013.

The report’s forecasts come with considerable uncertainties, especially regarding the prospect of new policies affecting coal. The issue of low prices also remains a hot topic among coal market participants. Last year’s report emphasised that many coal producers were running at losses, largely driven by take-or-pay infrastructure contracts or financial liabilities. Coal prices have declined even more since last year, but several factors have helped producers withstand further economic pain.

Freight

2015 January, SweetcrudeReports

Lagos port

NIMASA targets 90% ISPS code compliance this year KUNLE KALEJAYE

he Nigerian M a r i t i m e Administration and Safety A g e n c y , NIMASA, is planning for 90 percent of Nigeria's port facilities meet the International Ship and Port Facility Security, ISPS, code compliance before the end of this year. The maritime agency said the 90 percent compliance would be achieved through continuous Verification Inspection Exercise, VIE, of port facilities in order to maintain implementation pace and focus on continuous improvement. Director General of NIMASA, Ziakede Patrick

Akpobolokemi, who dropped this hint in Lagos recently explained that the agency had introduced a full-fledged unit to drive and pilot the code implementation. The director general added that the agency has adopted the ISPS code regulation, developed guidelines and quick reference cards to enhance assessment, inspection enforcement and monitoring inspection on a regular basis to ensure continuous improvement. He stated that as a result of a vigorous pursuit of the ISPS code compliance, "over 38 percent of 129 port facilities in the country have fully complied. "This comprises of all the major ports in the country. This is a great improvement from the less than seven

percent compliance level an increase in the agency's commended NIMASA for before the appointment of manpower capacity and being the foremost Port State NIMASA as the Designated availability of vessels for Control Administration in Authority, DA, in 2013. the West and Central African operation. The ‎ NIMASA boss He said: "I am delighted to Sub-Region just like other further explained that the i n f o r m y o u t h a t t h e leading maritime agency had been able to Secretary General of the stakeholders have gradually increase its Port Abuja Memorandum of commended NIMASA." State Control Performance Understanding, MoU, on in the last 12 months due to Port State Control recently

…Vows to rid Nigeria of sea pirates, kidnappers

he Nigerian Maritime Administrati on and Safety Agency, NIMASA, has restated its determination to rid the nation's maritime space of p i r a t e s a n d kidnappers.

Director General of the Lagos area and the number agency, Mr Ziakede Patrick of pirates in our custody, it Akpobolokemi, stated this in will be alarming; none of Lagos, saying NIMASA has them succeeded. taken pro-active steps ahead "Some of them, we have of pirates and with a promise handed them over to the to continue to frustrate Navy to help us and kidnappers in their evil working with them and civil acts.  "If I tell you in the last defense for prosecution; and one month plus, the number some of the vessels are in of attacks we have foiled in our custody.”

2015 January, SweetcrudeReports

Freight

Shippers group seeks re-organisation of maritime agencies …Upgrade of maritime institutions will stop capital flight - Expert

he Shippers Association in Lagos State has called for reorganisation of maritime agencies in the country to ensure better support from operators for government. President of the association, Mr Jonathan Nicol, who made the call, said re-organisation was necessary for government to earn more support from shippers and improve the economic indices of the country. "We in the maritime sector will do everything possible to give the government our unflinching support but maritime agencies must first be re-organised," he said, adding: We had in 2014 succeeded in showcasing that enormous money passed though the private sector illegally. "We paid so much money in port charges to port concessionaires. We were forced to go to court over this and the court agreed with us,". Nicol, who maintained that such issues ought to have been discussed amicably with stakeholders, said: "We need the government to intervene and save the economy by allowing normal business trend to prevail at the ports". Nicol also canvassed for cooperation among shippers in the country as he commended the Nigerian Shippers’ Council, NSC, for assuming its status as Port Economic Regulator through a court victory. According to hi, the NSC had remained focused in solving the enormous problems of shippers nationwide. Nicol made his call as another maritime expert, Capt. Fola Ojutalayo, called for the upgrade of maritime training institutions in the country to reduce capital flight occasioned by training of cadets abroad. Ojutalayo, who is also a Senior Lecturer at the Federal College of Fisheries and Marine Technology, said in Lagos that if well

Cargo ship equipped, indigenous maritime training institutions could provide the required training for maritime personnel. "Why is it that we cannot develop our institutions here in Nigeria; upgrade them to the level where we can sponsor these people. Let them go to these institutions, get their training and right there in the

industry they go and practice? "Why should we send them abroad? What is it they are doing there that we cannot do here? So, is still the same problem of human capacity development and systems problem," Ojutalayo argued. He continued: "You can imagine all those trainings they are sponsoring them

for are being paid for; they are not for free. That is capital flight. "If they use the money, pump them judiciously with all commitments into the maritime institutions in Nigeria. "You have the Maritime Academy of Nigeria in Oron; you have the Federal College of Fisheries and Marine

Council lauds attainment of port economic regulator status

h e P o r t Consultative Council, PCC, says the Nigerian port industry recorded an achievement of having an economic regulator, which was not in existence before. The President of the Council, Chief Kunle Folarin, said this in an interview in Lagos, maintaining that the introduction of port concession had changed the mode of operations of the Nigerian Ports

Authority, NPA. He said: "In 2014 the Federal Minister of Transport appointed the Nigerian Shippers Council (NSC) as the Economic Regulator in the port industry which was not there before. "We are following up events on this; we are looking at the feedback of that particular policy. We were able to x-ray it and share the opinion of stakeholders with the agency designated to manage this particular

issue. "So, port regulation is current; it’s very strategic for the industry and, therefore, our attention was focused on that. After concessioning, the NPA changed its status from being an active operator to becoming a landlord model operator. "Therefore, infrastructure, which is a major plank of their responsibility and mandate, was also revisited. "Particularly bringing about the issue that they need to look at port

Technology; both of them are Federal Government institutions. Why can’t we upgrade them?" Ojutalayo described the training of seafarers by NIMASA in several countries abroad as "misplaced priority", saying that the ships in the country might not have the capacity to absorb them. expansion, to bring about a master plan for the development of port industry and ports in general". He said that the council realised that the issue of port charges had become controversial among the key players in the maritime industry, mostly shippers. Folarin said that there was the need to look at what had been thrown up over the years on port charges and see how competitive the Nigerian ports would be. He, however, said that the issue would make Nigerian ports the preferred destination and accord the ports the hub status in the West African sub-region.

2015 January, SweetcrudeReports

Freight

Containers

CRFFN to prosecute quack clearing agents

he Council for the Regulation of F r e i g h t Forwarding in Nigeria, CRFFN, says it would, beginning from this month, move against all illegal clearing agents operating at the nation’s seaports, airports and land borders. The Council, which noted that it would not be business as usual for fraudulent practitioners in the new year,

has vowed to uphold professionalism in the freight forwarding industry. Registrar of the Council, Sir Mike Jukwe, while addressing the national leaders of registered freight forwarding associations in Lagos, said those who clear goods without registering would be prosecuted by the tribunal of the Council, adding that anyone found guilty “shall be sentenced”. Announcing this to all the

practitioners present, Jukwe said CRFFN would c o m m e n c e f u l l implementation of its statutory roles by January 2015. The CRFFN registrar, who also spoke of plans by the agency to issue new regulations for all practitioners, said: “We are going to sanitise this industry, we cannot afford the business as usual. “The Council will de-

register any company that falls foul of the laws and by the time we de-register people and send them out of the industry, others will sit up.” Jukwe equally spoke of plans by the council to ensure regular meetings with corporate bodies in the industry so as to strengthen relationship with them. National President, Association of Nigerian Licensed Customs Agents,

NPA bars rickety trucks from Apapa Port

he Nigerian Ports Authority, NPA, has vowed to strictly enforce the implementation of minimum standard for trucks coming into the Apapa ports effective this month. The Port Manager, Lagos Port Complex, Apapa, Mr. Nasir Anas Mohammed

disclosed, said NPA would stop trucks that do not meet the standards required of them for operating at the ports. “We are worried that trucks come into the ports to pick consignments and they break down on roads. But we at NPA are interested that you not only pick from the port but

take it safely to the owners’ warehouse or end users conveniently. “We want to put it on the front burner this year because we are not happy seeing trucks breaking down on the roads every where around the country,” he told Ships & Ports. Mohammed said that

Vehicle Inspection Officers, VIOs, and operatives of the L a g o s S t a t e Command of the Federal Road Safety Corps, FRSC, would be fully involved in enforcing the trucks minimum standards.

A N L C A , P r i n c e OlayiwolaShittu; Deputy National President, National Association of Government Approved Freight Forwarders, NAGAFF, Barr. Fred Aikokai; and representatives of the Association of Registered Freight Forwarders in Nigeria, AREFFN, and the National Council of Ma na g ing Direct ors of Licensed Customs Agents, NCMDLCA, all attended the meeting with Jukwe at the new CRFFN national headquarters in Apapa, Lagos. Speaking at the event, ANLCA President Shittu urged accredited training institutes for freight forwarders to embrace increased publicity to reach out to members of the registered associations as the executives could only persuade the members but could not force them to undertake trainings. Shittu advised the regulatory body to understand and appreciate the reasons for its creation and live up to the standard for which it was established.

2015 January, SweetcrudeReports

Freight SAM IKEOTUONYE

ifty-three ships are expected to sail into the Lagos ports before January 28, according to the Nigerian Ports Authority, NPA. The vessels have already started arriving the country given that the schedule for their arrival is for the period, December 23, 2014 to January 28, this year. According to the NPA, 27 of the expected ships would sail into the ports with containers, while 13 others would arrive with food products, including rice, frozen fish, buckwheat, bulk sugar and bulk salt. It added that seven ships containing petroleum products were also expected to arrive the ports.

53 ships expected at Lagos ports before month end It said the petroleum products would include diesel and petrol, while the remaining six ships would sail in with general cargo. The NPA had on the eve of Christmas announced in its daily publication, the ‘Shipping Position,’ that 11

ships laden with petrol had arrived at the Lagos ports The document indicated that three other ships had arrived the ports with base oil and aviation fuel. It stated that seven other ships arrived with food items including bulk malt,

Reps to probe Tompolo over purchase of gunboats

he House of Representatives will this New Year commence investigation into the circumstances surrounding the purchase of six gunboats by exmilitant leader, Mr. Government Ekpemupolo, popularly known as Tompolo. The vessels were procured through his company, Global West, allegedly for its Niger Delta surveillance contract with the Federal Government. The Chairman, House of Representatives Committee on Media and Public Affairs, Mr. Zakari Mohammed, however, described the alleged purchase of the six gunboats by Tompolo as “scary,” saying it raised security concerns at a time the country was facing tough security challenges. Although the Nigerian Navy said the the boats belonged to NIMASA, a Federal Government agency, Mohammed said the House would be interested in knowing how a private individual was now performing a function that was statutorily the Navy’s. “That function should have been performed by the Navy. When we resume in January, our relevant committees will be looking into the issue,” he added. Mohammed recalled that, two years ago, the House moved to investigate a pipeline security contract the government awarded to Tompolo, but it was portrayed as going against the executive arm of government. “Each time we talk in the House, we are like a bunch of nuisances. We had raised this issue of involving private individuals in our waterways in the past, but the House was not taken seriously. “Now, we are where we are today,” he stated.

Gun boats

bulk sugar, rice and bulk fertiliser. As at December 31, 2014, NPA reported, 25 of the ships, laden with petroleum products and other commodities, had arrived at Lagos ports, waiting to discharge their contents.

Twelve out of the 25 ships, it said, would discharge petrol, while a ship was laden with Low Pour Fuel Oil, LPFO. The remaining 12 ships arrived at the ports with food items such as bulk rice, general cargo, bulk gypsum, fresh fish and bulk fertiliser.

Motoring

2015 January, SweetcrudeReports

CAR AND DRIVER

T 10Best Cars unveils the

BMW M235i

he M235i is neither a fully aggro M car nor just a day-to-day standard sports coupe. Its

2015

character is in between the two. And that’s... well, perfect. The M235i is easy to drive slowly and rewarding to drive quickly. It is, in fact, just about everything we want a modern

3 Series to be: q u i c k , confident, and sexy, with decent fuel economy, a close-coupled cockpit, and an eagerness to romp that’s b e e n suppressed in the current 3. The car is a manifestation of nostalgic i m p u l s e s harkening back to the E46 M3.

Chevrolet Corvette Stingray

ven in this, its second year on our list, C7s hypnotize, the convertible and coupe equally. Sitting in the lot

here are roughly 150 new car models on the market today, many of them only narrowly distinguishable from each other. The sedans are flame-surfaced affairs with elongated rooflines, and even the sporty coupes rely on huge grilles to trumpet their brand lineage. Most emit the same muffled calls, so you can’t reliably classify them by sound, either. This guide is intended to help you identify the 10 cars that, through a rare combination of strengths, stand apart. They reward close observation. The assembled

among the other contenders, they stand out as if rendered on a Retina display while others are appearing on a CRT. You might think that our familiarity with its

cars share the following traits: They cost less than $80,000, they excel at delivering value for the money, they have a strong mastery of their segment, and they are graceful in motion. These 10 will entertain and delight any driver, but only if you know how and where to spot them.

Cadillac CTS

many facets and creases has bred boredom, and certainly other beguiling shapes, even a real Italian demi-supercar, vied for our attention this year. But the Stingray looks transplanted from childhood fantasy, an interstellar dragon. We hear it roar, smell the heat of the LT1 cooking its own polymer skin, and the Corvette turns such imaginings into reality.

Honda Accord

here is a veil of sameness draped over the Accord that comes from racking up 300,000 to 400,000 annual sales, year after year. Who would imagine that such an exceptional car could be hiding in plain sight, mimicking a lowest-common-denominator family

adillac’s CTS fended off multiple Audis, Benzes, and BMWs to win its 10Best berth. While we are (still) big fans of the twin-turbocharged, 420-hp V-6 that powers the Vsport model, it’s the handling that sets the CTS apart from the competition.

Ford Mustang GT

uring the developme nt of the 2015 Mustang, one move set off a chain reaction that irreversibly altered the Mustang for the better. Granted, it was a big change: swapping out the old solid rear axle for an independent one. Partially derived from the aluminum and

appliance? The seduction is a subtle, two-pronged lure. The first is that the Accord combines thousands of parts into one as if they weren’t bolted, welded, snapped, or glued together but molded to form a single, one-piece device.

steel components supporting the tail of Ford’s Fusion sedan, the Mustang’s new independent suspension brings unprecedented refinement—unprecedented for a Mustang, anyway.

Parse each piece, though, and here’s what you get: the harmonious hum of hundreds of engine components, slicing throws of the six-speed manual or fast responses from the continuously CONTINUES ON PAGE 39

2015 January, SweetcrudeReports

Motoring

CAR AND DRIVER

CONTINUED FROM PAGE 38

10Best Cars of

2015

variable transmission (yes, even it), satisfying weight in the steering, an absorbent yet playful suspension, and a driving position that seems to have been custom tailored with an emphasis on great outward visibility. Accords are better cars than they have to be, better than their owners might demand, a rarity in our consumer economy.

Mazda3

ur favorite powertrain is new for 2015, a naturally aspirated 2.5liter inline-four making 184 horsepower and driving the front wheels through Mazda’s tidy sixspeed manual. The four is as forthright and linear as the steering, which makes the whole car feel harmonious, matched, and smooth, and not like some intemperate hot hatch. But a hot hatch is what it is.”

Mazda6

azda has done it. The 6 is that rare beast, a car that looks like it drives and drives like it looks: taut, agile, and, yes, athletic. In a world where car design is often nothing more than bending metal around a set of platform-derived hard points and then thinking up some zingy metaphors, the 6 stands out as the real thing. All the more impressive is that Mazda has pulled off the form-and-function double with a midsize sedan. The more time you spend in the 6, the more you find yourself wondering how much more car you actually need. Unless you have 12 kids, the answer is probably none. The mid-engined Porsche twins are so fundamentally different from the competition that considering them for a 10Best nod feels as if we’ve shattered our price ceiling—most of their architectural analogues cost three and four times as much. Admittedly, the Boxster and Cayman easily blow past $80,000 when moderately optioned, but the inherent goodness of these cars is fully realized even at the Boxster’s $52,395 base price.

Porsche Boxter/ Cayman

he Boxster and Cayman demonstrate immense mutability. They are daily drivers, luxury coupes, and sports cars. Scouring our notes on the pair, we find complaints

only about the cup holders. The third generation of Porsche’s mid-engine platform has also widened the gap between base and S models. If you’re expecting straight-line performance

Volkswagen Golf / GTI

ike a Swiss Army k n i f e , t h e Golf—now in its seventh generation—is a historically mellifluous integration of mechanical functions into a hamster wheel of usefulness. It

doesn’t look much different, which is just fine. It doesn’t feel much different, which is just fine, too. We say that because this is the ninth consecutive year that the whole Golf family, the lone GTI, or, as is the case here,

from these corner hunters, the base cars can be uncomfortably slow. The extra power of the S and GTS trims, however, transforms these cars into well-rounded athletes.

both have accumulated 10Best plaudits. Not even a U.S. president gets to walk on blue carpeting for that long. There are larger cars for the money, just as there’s a 314-blade Swiss Army knife that weighs 11 pounds. But few cars engender as much driving satisfaction, and few annually hold a snappier family reunion, in which no relative gets loud or offensive, except maybe the perennially delinquent cousin in the plaid pants. Oh, no. What’s he pouring in the punch? Jeez. He seemed like such a nice young man.

Tesla Model S 60

t’s rightly amazing that Tesla, only a few years removed from startup, can massmanufacture a car this good, while also fighting state-by-state franchise battles, building out its network of Supercharger stations, planning its “gigafactory” batterymanufacturing operation, and mollifying the financial community. And, sure, the CEO occasionally has to divert some attention to one of his other companies that makes

spaceships. Maybe that’s why it has taken Tesla some time to get us a 60-kWh Model S, two years after we tested the top-of-the-line Model S P85, the one with the gargantuan battery pack and uprated motor and a base price that exceeds our 10Best threshold. The 60 truncates some power and range to qualify, while sacrificing nothing else. It is a revelatory machine, with possibilities that are still unfolding.

Technology

2015 January, SweetcrudeReports

Shale oil, oil sands and oil supply. This data shows a far smaller gap between OPEC and Shale oil

ven though we had covered Shale oil technology in a p r e v i o u s edition, its resurgence and attendant impact on production of conventional oil and associated pricing warrants a peak at the economics around production cost. Oil shale economics deals with the economic feasibility of oil shale extraction and processing. Although usually oil shale economics is understood as shale oil extraction economics, the wider approach evaluates usage of oil shale as whole, including for the oil-shalefired power generation and production of by-products during retorting or shale oil upgrading processes. The economic feasibility of oil shale is highly dependent on the price of conventional oil, and the assumption that the price will remain at a certain level for some time to come. As a developing fuel source the production and processing costs for oil shale are high due to the small nature of the projects and the

Oil shale economics specialist technology involved. A full-scale project to develop oil shale would require heavy investment and could potentially leave businesses vulnerable should the oil price drop and the cost of producing the oil would exceed the price they could obtain for the oil. Due to the volatile prices and high capital costs few deposits can be exploited economically without subsidies. However, some countries, such as United States, Estonia, Brazil, and China, operate oil-shale industries, while some others, including Australia, Canada, Jordan, Israel, and Egypt, are contemplating establishing or re-establishing this industry. The production cost of a barrel of shale oil used to range from as high as US$95 per barrel to as low US$25 per barrel, although there is no recent confirmation of the latter figure, indications are that recent development in technology has witnessed a

The production cost of a barrel of shale oil used to range from as high as US$95 per barrel to as low US$25 per barrel, although there is no recent confirmation of the latter figure, indications are that recent development in technology has witnessed a drop in the production cost and accompanying resurgence in growth drop in the production cost and accompanying resurgence in growth. The industry is proceeding cautiously, due to the losses incurred during the last major investment into oil shale in the early 1980s, when a subsequent collapse in the oil price left the projects uneconomical.

Breakeven price of oil The various attempts to develop oil shale deposits have succeeded only when the cost of shale-oil production in a given region comes in below the price of crude oil or its other substitutes (break-even

price). The United States Department of Energy estimates that the ex-situ processing would be economic at sustained average world oil prices above US$$54 per barrel and in-situ processing would be economic at prices above $35 per barrel. These estimates assume a return rate of 15%. The International Energy Agency estimates, based on the various pilot projects, that investment and operating costs would be similar to those of Canadian oil sands, that means would be economic at prices above $60 per barrel at current costs. This figure does not account carbon pricing, which will add additional cost. According to the New Policies Scenario introduced in its World Energy Outlook 2010, a price of $50 per tonne of emitted CO 2, expected by 2035, will CONTINUES ON PAGE 41

2015 January, SweetcrudeReports

Technology CONTINUED FROM PAGE 40

add additional $7.50 per barrel cost of shale oil. According to a survey conducted by the RAND Corporation, the cost of producing a barrel of oil at a surface retorting complex in the United States (comprising a mine, retorting plant, upgrading plant, supporting utilities, and spent shale reclamation), would range b e t w e e n $ 7 0 – 9 5 ($440–600/m3, adjusted to 2005 values). This estimate considers varying levels of kerogen quality and extraction efficiency. In order for the operation to be profitable, the price of crude oil would need to remain above these levels. The analysis also discusses the expectation that processing costs would drop after the complex was established. The hypothetical unit would see a cost reduction of 35–70% after its first 500 million barrels (79×106 m3) were produced. Assuming an increase in output of 25 thousand barrels per day (4.0×103 m3/d) during each year after the start of commercial production, the costs would then be expected to decline to $35–48 per barrel ($220–300/m3) within 12 years. After achieving the milestone of 1 billion barrels (160×106 m3), its costs would decline further to $30–40 per barrel ($190–250/m3). In 2005, Royal Dutch Shell announced that its in situ extraction technology could become competitive at prices over $30 per barrel ($190/m3). However, Shell reported in 2007 that the cost of creating an underground freeze wall to contain groundwater contamination had significantly escalated. Anyway, as the commercial scale production by Shell is not foreseen until 2025, the real price needed to make production economic remains unclear. At full-scale production, the production costs for one barrel of light crude oil of the Australia's Stuart plant were projected to be in the range of $11.3 to $12.4 per barrel, including capital costs and operation costs over a projected 30-year lifetime. However, the project has been suspended due to environmental concerns.

Oil shale economics

Shale bait The project of a new Alberta Taciuk Processor which was planned by VKG Oil, was estimated to achieve breakeven financial feasibility operating at 30% capacity, assuming a crude oil price of $21 per barrel or higher. At 50% utilization, the project was expected to be economic at a price of $18 per barrel, while at full capacity, it could be economic at a price of $13 per

barrel. However, instead of Alberta Taciuk Processor VKG proceeded with a Petroter retort which production price level is not disclosed. Production costs in China have been reported to be as low as less than $25 per barrel, although there is no recent confirmation of this figure.

Capital cost A comparison of the proposed American oil shale industry to the Alberta oilsands industry has been drawn (the latter enterprise generated over 1 million barrels per day (160×103 m3/d) of oil in late 2007), stating that "the firstgeneration facility is the hardest, both technically and

economically". According to the United States Department of Energy, in 1980s the costs of a 100,000 barrels per day (16,000 m3/d) ex-situ processing complex ranged from $8–12 billion at 2005 prices. It is estimated that the current capital costs are $3–10 billion at 2005 prices. The new 100,000 tonnes shale oil per year retort built by VKG cost EEK 1.1 billion (€70.3 million); however, it is located in the existing production site and uses the existing infrastructure. The RAND Corporation assumes that the development of 100,000 barrels per day (16,000 m3/d) processing plant in the United States will take 12 years, while to achieve the level of 1 million barrels per day (160×103 m3/d) will take at least 20 years and 3 million barrels per day (480×103 m3/d) around 30 years. CONTINUES ON PAGE 42

2015 January, SweetcrudeReports

Technology CONTINUED FROM PAGE 41

Oil shale economics Previous investment In the second half of the 20th century, oil shale production ceased in Canada, Scotland, Sweden, France, Australia, Romania, and South Africa due to the low price of oil and other competitive fuels. In the United States, during the 1973 oil crisis businesses expected oil prices to stay as high as US$70 a barrel, and invested considerable sums in the oil shale industry. World production of oil shale reached a peak of 46 million tonnes in 1980. Due to competition from cheap conventional petroleum in the 1980s, several investments became economically unfeasible. On 2 May 1982, known as "Black Sunday", Exxon canceled its US$5 billion Colony Shale Oil Project near Parachute, Colorado because of low oilprices and increased expenses. Because of the losses in 1980s, companies were reluctant to make new invests in shale oil production. However, in the early 21st century, USA, Canada and Jordan were planning or had started shale oil production test projects, and Australia was considering restarting oil shale production. In a 1972 publication by the journal Pétrole Informations (ISSN 0755561X), shale oil production was unfavorably compared to the liquefaction of coal. The article stated that coal liquefaction was less expensive, generated more oil, and created fewer environmental impacts than oil shale extraction. It cited a conversion ratio of 650 litres (170 U.S. gal; 140 imp gal) of oil per one ton of coal, as against 150 litres (40 U.S. gal) per one ton of shale oil. Energy usage A measure of the viability of oil shale as a fuel source is the ratio of the energy produced to the energy used converting it (Energy Returned on Energy Invested - EROEI). The value of the EROEI for oil shale is difficult to calculate for a number of reasons. Lack of reliable studies of modern oil shale processes, poor or undocumented methodology and a limited number of

operational facilities are the main reasons. Due to technically more complex processes, the EROEI for oil shale is below the EROEI of about 20:1 for conventional oil extraction at the wellhead. A 1984 study estimated the EROEI of the different oil shale deposits to vary between 0.7–13.3:1. More recent studies estimates the EROEI of oil shales to be 1–2:1 or 2–16:1 – depending on if self-energy is counted as a cost or internal energy is excluded and only purchased energy is counted as input. According to the World Energy Outlook 2010, the EROEI of ex-situ processing is typically 4–5:1 while of in-situ processing it may be even as low as 2:1.Royal Dutch Shell has reported an expected EROEI about 3–4:1 on its in-situ test project. Internal energy (or selfenergy) is energy released by the oil shale conversion process that is used to power that operation (e.g. obtained by combustion of conversion by-products such as oil shale gas), and therefore reducing the use of other fuels (external energy). There are different views as

Shale gas flare

to if the internal energy should be added to the calculation as cost or not. One opinion is that internal energy should not be counted as an energy cost because is does not have an opportunity cost, unlike external energy used in the process. Another opinion is that internal energy is used for performing useful work and therefore should be added to the calculation. It might also be argued that internal energy should be included as energy invested because it contributes to CO2 emissions. However, EROEI then becomes a measure of environmental acceptability rather than economic viability. Water usuage Development of oil shale resources will require significant quantities of water for mine and plant operations, reclamation, supporting infrastructure, and associated economic growth. Above-ground retorting typically consumes between one and five barrels of water per barrel of produced shale oil, depending on technology. For an oil shale industry producing 2.5 million

barrels per day (400×103 m3/d), this equates to 105,000,000–315,000,000 US gallons per day (400,000–1,190,000 m3/d) of water. These numbers include water requirements for power generation for insitu heating processes, retorting, refining, reclamation, dust control and on-site worker demands. Municipal and other water requirements related to population growth associated with industry development will require an additional 58 million US gallons (220,000 m3) per day. Hence, a 2.5 million barrels per day (400×103 m3/d) oil shale industry would require 180,000 to 420,000 acre feet (220,000,000 to 520,000,000 m3) of water per year, depending on location and processes used. The largest deposit of oil shale in the United States is in the Green River basin. Though scarce, water in the western United States is treated as a commodity which can be bought and sold in a competitive market. Royal Dutch Shell has been reported to be buying groundwater rights in Colorado as it prepares to drill for oil in the shale deposits there. In the Colorado BigThompson project, average prices per share (0.7 acre feet (860 m3)/share) increased

from some $2,000 in 1990 to more than $12,000 in mid2003 (constant 2001 dollars). CBT Prices from 2001 to 2006 has had a range of $10,000 to $14,000 per share, or $14,000 to $20,000 per acre foot. At $10,000 per acre foot, capital costs for water rights to produce 2.5 million barrels per day (400×103 m3/d) would range between $1.8-4.2 billion. Co-pyrolysis Several co-pyrolysis processes to increase efficiency of oil shale retorting have been proposed or tested. In Estonia, the copyrolysis of kukersite with renewable fuel (wood waste), as well as with plastic and rubber wastes (tyres), has been tested. Co-pyrolysis of oil shale with high-density polyethylene (HDPE) has been tested also in Morocco and Turkey. Israel's AFSK Hom Tov copyrolyses oil shale with oil refinery residue (bitumen). Some tests involve copyrolysis of oil shale with lignite and cellulose wastes. Depending on reaction conditions, the co-pyrolysis may lead to higher conversion ratios and thus lower production costs, and in some cases solves the problem of utilization of certain wastes.

Community

2015 January, SweetcrudeReports

Oil theft barges

Bayelsa govt reviews security policy to check oil theft

he Bayelsa State Government has reviewed its security policy to check crude oil theft in the state, SweetcrudeReports has learnt. Chief James Jephthah, Managing Director, Izon-Ibe Security Company, who disclosed this in Yenagoa, the Bayelsa State capital, said the policy review was to check pipeline vandalism along the creeks and waterways in the oil producing state. The state government recently incorporated the security firm, which it jointly owns with the private sector, to protect oil installations within the state with a view to stopping oil theft. According to Jephthah, there was need to arrest the activities of oil thieves and pipeline vandals in the oilrich state, as their activities

have contributed to the decline in oil derivation revenue accruing to the state. Jephthah explained that when vandals destroy pipelines, oil companies were compelled to shut down production, thereby reducing the volume of oil produced in the state and by implication, the revenue. He said: “Izon-Ibe Security Company was set up by the present administration with the responsibility to provide security for oil installations and check oil theft. “The new company will also carry out surveillance on critical assets and infrastructure of multinationals, government and other viable business concerns in Bayelsa. “The company has invited all multinational oil companies and others doing business in and around the state, to register with it and terminate

any existing security contracts with individuals or companies.” He urged the oil firms operating in the state to embrace the new initiative which he said was aimed at reducing the risk of doing

business in the state. The managing director, however, assured existing pipeline surveillance contractors that their economic interests would be protected in the new arrangement.

“The management has also invited all pipeline surveillance contractors and other security contractors to report to its office with photocopies of their contractual agreements in this regard," he added.

A/Ibom has raised bar for NDDC projects —Dan-Abia MKPOIKANA UDOMA

he Managing Director and Chief Executive Officer of the Niger Delta Development Commission, NDDC, Sir Bassey Dan-Abia, has pledged that the interventionist agency would not compromise on quality. The NDDC boss spoke while inspecting ongoing projects being executed by the commission in Akwa Ibom State, in the company of the representative of AkwaIbom state in the governing board of the NDDC, Engr. Etim Inyang Jnr, and the

Commission’s Executive Director on Projects, Engr. Tuoyo Omatsuli. Inspecting the Odoro-Atan IkotInyang Okop-Odoro Ikot-Abiate Road in Mkpat-Enin Local Government Area, Sir Dan-Abia urged the contractors to strive for quality and high standards. He said, “The Akwa Ibom standard is high and we want NDDC contractors to keep to that standard. The state government has raised the bar in performance and we expect our contractors to step up to that level”

2015 January, SweetcrudeReports

Community

We’ve always wanted compensation for Bodo community - Shell *Damages from oil spill can't be quantified by money -Community MKPOIKANA UDOMA “From the outset, we’ve accepted responsibility for the two deeply regrettable operational spills in Bodo. We’ve always wanted to compensate the community fairly and we are pleased to have reached agreement.”

ith these words, Mr. M u t i u Sunmonu, Managing Director of Shell Petroleum Development Company of Nigeria, SPDC, announced a £55 million settlement agreement with the Bodo community in respect of the two oil spills in the area in 2008. The community has since accepted the compensation, but leaders are of the view that damages caused by the oil spill cannot be quantified by money. Chairman of Bodo Community Council of Chiefs and Elders, Chief Sylvester K o g b a r a t o l d SweetcrudeReports in Bodo that the community decided to accept the money from Shell in good faith, so as to move forward in life. The £55 million settlement for damages caused by the two oil spills provides for an individual payment to each claimant who accepts the settlement agreement in compensation for losses arising from the spills, amounting to up to £35 million in total. The remaining £20 million payment will be made for the benefit of the Bodo community generally. “We are fully committed to the clean-up process being overseen by a former Netherlands’ Ambassador to Nigeria. Despite delays caused by divisions within the community, we are pleased that clean-up work will soon begin now that a plan has been agreed with the community. “However, unless real action is taken to end the scourge of oil theft and illegal refining, which remains the main cause of environmental pollution and is the real

Farmland affected by oil spillage tragedy of the Niger Delta, areas that are cleaned up will simply become re-impacted through these illegal activities," Sunmonu also said. He added: “SPDC has made efforts to raise awareness of the issue with the government of Nigeria, international bodies like the United Nations, the media, civil society and international nongovernmental organisations (NGOs), and we will continue to play an active role in the search for solutions. We urge all those with influence, including Bodo community leaders and NGO groups, to support this effort,” Mutiu pointed out. Reacting to the £55 million settlement agreement with the Bodo community, the Environmental Rights Action, ERA, described the amount being paid by Shell as a “a gross underestimation of the damages caused by the spills.” ERA's spokesman, Mr. Phillip Jakpor, stated that what the multinational oil company should do was to implement the United Nations Environmental Programme, UNEP, Report on Ogoniland and allow an independent body to monitor the exercise.

The £55 million settlement for damages caused by the two oil spills provides for an individual payment to each claimant who accepts the settlement agreement in compensation for losses arising from the spills The UNEP had in the 2011 report recommended the establishment of a $1 billion fund to clean up contaminated land in Ogoni result ing from Shell' s operations in the area and the oil spills it visited on the land. Shell had regretted the spills and expressed willingness to clean up the area by providing its counterpart funding, but the Nigerian government’s inability to take action on the matter had frustrated the company's clean up plan for the area.

Also reacting to the settlement agreement, chairman, Bodo Community Council of Chiefs and Elders, Chief Kogbara, said: “You cannot quantified the damage here in naira and Kobo, what has happened here is far over and above the amount … Even UNEP looked at Bodo community and said it will take at least 30 years to clean up Bodo. If we have said let us quantified this, I don’t think Shell would have been able to pay. "But since they (Shell) called for negotiation, we had to accept and what was

agreed on the negotiation table we have to take it in demonstration of good faith, and we expect that Shell too should also go ahead to demonstrate this good faith in ensuring that our environment is cleaned up very quickly”. One of the fishermen affected by the Bodo oil spill, Mr. Confidence Nyode, said it would take a long time to restore the aquatic lives in the polluted Bodo rivers. “We are totally devastated. In my own case I am not a big-time fisherman. I am only a peasant fisherman and what we do was to collect mudskippers, oysters, periwinkles and other seafood from the mangroves and sell in the market. These areas are now covered by the spill, what you see there as mudflat is a sediment of crude. So all the mudskippers, the crustaceans and variety of them which we used in earning a living have all been destroyed. There is no more life in the river here, where we used to practice our peasant fishing,” he said.

2015 January, SweetcrudeReports

Community

Boats set ablaze by JTF

JTF uncovers hide out of sea pirates in Bayelsa …Recovers arms, ammunitions

n its efforts at eradicating sundry crimes and safe guarding the Niger Delta region, the antikidnapping and sea robbery squad of the Joint Military Task Force, JTF, codenamed Operation Pulo Shield, has arrested five suspected sea pirates. The arrest was not unconnected to the recent attack of a fiber boat belonging to JTF. The JTF in a statement by its Coordinator, Joint Media Campaign Centre, Colonel Mustapha Anka, said its aggressive and continuous day and night raids as well as the stop and search patrols along the waterways led to the arrest and the recovery of some weapons from the hoodlums. According to the statement, “ Du ri ng t he we e k- l o ng operation, three Browning Machine Gun (BMGs) with registration Nos 1981 with stand, B572 Banel No Z90323 with stand, HMG – 50MG ST Kinetics Serial No

2405PM with sitting, with its links ammunition (buried under ground) were recovered, others are one AK 47 Rifles without registration No, a G3 Rifle with No G310D792 and She Rifle with Reg No T67439 and Wooden

Dummy rifle. “Other items include three gunboat batteries, one Hp laptop computer, one Police fragmental jacket, 1 x 200 horse power engine, empty cases of 12.7mm ammunition of HMG gun,

one search light with batteries, one bag containing boat tools, one Nokia G6 mobile phone, two rifle butts and one plastic toy pistol'. They were recovered in Ukubie community in Southern Ijaw Local

Government Area of Bayelsa State, JTF said. The statement further read: “The manhunt was launched on the suspected sea robbers that attack JTF troops and waterways users in Sangana and Santa-Barbara waterways in Bayelsa and Rivers States. "Since the arrest of the criminals, the normal peace that existed in the region has returned in the entire waterways. The JTF Command wishes to reassure the good people of the Niger Delta and Nigerian in entirety not to fret, as JTF is on top of the situation”. The JTF said the recovery of the arms and ammunition as well as arrest of the suspected sea robbers was an indication that miscreants had been denied access. The command, under the leadership of Major General Emmanuel Atewe, further reiterated its commitment at safe-guarding the region before, during and after the 2015 general elections. "The optimism is attributed to the recent delivery of gunboats to the JTF by the Defence Headquarters to fight against all forms of criminalities, especially as the 2015 general elections approaches. The command is intensifying efforts through constant and aggressive day and night operational patrols to deny miscreants opportunity to perpetuate their nefarious activities. The JTF once again warns perpetuators of illegalities in the Niger Delta to desist from any form of criminal act as the command is bent on fishing out criminals and ensuring they face the wrath of the law,” the JTF statement also said.

Kula Community calls for re-award of NDDC projects MKPOIKANA UDOMA

h e Community Development Committee in Kula, Akuku-Toru Local Government Area of Rivers State, has called on the Managing Director of the Niger Delta Development Commission, NDDC, Sir Bassey Dan-Abia, to reaward the Shore Protection projects and other NDDC

projects in the community to more competent contractors capable of delivering the projects. Kula is host to four oil flow stations belonging to Chevron and Shell. Chairman of the committee, Mr. Christopher Fiberesima, told SweetCrudeReports in Port Harcourt that since the award by the NDDC of a shore protection contract and that for an 11-kilometre internal road to some local contractors (Baywick Engineering Ltd and OKI and Sons Ltd) in 2009 and 2011 respectively, the

contractors were yet to mobilise to site till date. Accusing the NDDC of not taking the development of Kula serious despite its immense contribution to the economy of Nigeria, Fiberesima, said: “NDDC embarked on two different projects in Kula Community, which are a shore-protection project awarded to Baywick Engineering Company, and road construction awarded to OKI and Sons Ltd; but it is unfortunate that since these jobs were awarded, there is nothing to show that a job of these nature has been awarded.

“OKI and Sons Ltd told us that when the dry season comes they will mobilise to site, and now is dry season, as I am talking to you now, they are yet to mobilise to site while Baywick tried to report to site but came to us (community) complaining that they could not find sand within the area for the sandfiling of the shore. "Baywick is even telling us to write to NDDC to make an additional fund for them so they could get an ocean dredger in order to get sand, since Kula is an oceanic community.”

2015 January, SweetcrudeReports

Community

Group warns against politicising UNEP's Ogoni report MKPOIKANA UDOMA

n environmental right group known as Ken Saro-Wiwa Associate has called on the people of Rivers State, particularly those of the Ogoni ethnic nationality, to support the Federal Government in the implementation of the environmental assessment report recommended by the U n i t e d N a t i o n s Environmental Programme, UNEP. At a press briefing in Port Harcourt, the national coordinator of the group, Chief Gani Topba, said the Ken Saro-Wiwa Associates was against any act capable of truncating the agreement between the Federal Government and Movement for the Survival of Ogoni People, MOSOP, on the implementation of the UNEP report. Chief Topba who reiterated that the group came up with the position in its four-point communiqué at the end of the year (2014) congress, said all hands must be on deck for the effective and successful implementation of the UNEP report. According to him, "It is not time to drag politics into the implementation of the UNEP reports. The Federal Government, through the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke has shown that it can clean-up Ogoni environment. They should be supported because the government is addressing the issue that affects the poor in Ogoniland”. Maintaining that his group has resolved to fully and wholeheartedly support the

Ministry of Petroleum Resources-led remedial intervention aimed at restoring the Ogoni environment, he noted that all the steps adopted so far in that direction were fully in compliance with the agreements reached on August 8, 2014, between the

Federal Government and the people of Ogoni led by MOSOP. The national coordinator of the environmental right group also appealed to politicians in Ogoni, regardless of political affiliations, to support the federal Government in the

is compatible with the views of Ken Saro-Wiwa Associate and the Ogoni people, that the Ogoni environment is a common heritage, and, therefore, belongs to all, regardless of political persuasion" he said.

Oil spill

NDDC trains teachers on ICT, gives out computers

Computer training

restoration of the Ogoni environment. "We fully restate the Ogoni view that partisan politics should not be allowed to reduce the rigour with which the Federal Government and the main stakeholders are executing the restoration of the Ogoni environment. This

he Niger Delta Development Commission, NDDC, has commenced a series of capacity-building workshops for secondary school teachers in the Niger Delta region, tagged, 'educate-the-educators programme'. The programme is focusing on Information C o m m u n i c a t i o n Technology, ICT, and is planned to cover the nine states of the Niger Delta

region. Speaking at the workshop in Uyo, the Akwa Ibom State capital, NDDC Managing Director, Sir Bassey DanAbia, said the commission was determined to drive the process of providing infrastructure and building human capacity. He said that the commission found it necessary to partner with relevant organisations to build the capacity of teachers in ICT. The NDDC Managing

Director, who was represented by Dr. Solomon Ita, the Director of Education, Health and Social Services, noted that the commission had previously trained 5,000 science teachers in the region. He said: “Much as we focus on training our teachers and graduates in the sciences, we also found it necessary to intervene in the ICT sector because we noticed that about 65% of teachers in the Niger Delta were deficient in ICT.”

Community

2015 January, SweetcrudeReports

E-mail: johniyene@yahoo.com

An energy policy for the future

Fishing in polluted water

Ogoni: Govt responding positively to UNEP report, says MOSOP MKPOIKANA UDOMA

he apex Ogoni socio-political group, the Movement for the Survival of Ogoni People, MOSOP, says the Federal Government is responding positively to the implementation of the UNEP report on oil pollution in Ogoniland, after three years of inaction. President of MOSOP, Comrade Legborsi Saro Pyagbara stated this at the Ogoni Day celebration in Bori, expressing confidence that 2015 holds greater promise for Ogoni people, in terms of environmental restoration and remediation. He advised President Goodluck Jonathan to ensure that the environmental degradation in Ogoniland was resolved this year. According to him, “After t h r e e y e a r s o f incomprehensible inaction on the UNEP report, the government have now responded positively. Since the convening of the convocative meeting of the Ogoni people on the 8th of August 2014, series of other engagements have taken place and we are confident that the year 2015 holds a better promise before the Ogoni people in terms of the environmental restoration of the Ogoniland. "We commend the steps that have been taken by the

We commend the steps that have been taken by the Federal Government so far, in ensuring that the environmental nightmare in Ogoniland is resolved once and for all Federal Government so far, in ensuring that the environmental nightmare in Ogoniland is resolved once and for all”. The MOSOP president also commended "the Ogoni sons who showed interest in the number one position of Rivers State (the Rivers State governorship seat)", including the former chairman, Joint Senate Committee on the Petroleum Industry Bill, Sen. Lee Maeba. “I want to use this opportunity to thank my brothers who stepped out in respect of our campaign to say that they have the capacity to lead Rivers State. I want to thank Prof. Don Baridam, Sen. Lee Maeba, Sen. Magnus Abe, Sir Gabriel Pidomson, Hon. Bernard Likor, and Dumbari Dimkpa, all of whom tried and prove to the world that Ogoni are responsible, qualified and can become governor of Rivers State," he said. The governorship candidates of the two leading political parties in Rivers State, the All

Progressive Party, APC, and the P e o p l e s Democratic Party, PDP, were present at the 2015 Ogoni Day celebration. T h e P D P governorship candidate, Chief Nyesom Wike, in his speech at the event, promised to support the Ogonis to actualise their dreams, especially i n t h e implementation of the UNEP Report. On his part, the APC governorship candidate, Hon. Dakuku Peterside, s a i d t h e development of Ogoni remains a top priority in his agenda, since the Ogoni remains a major contributor to the economy of the country.

tephen Onyokia is a retired oil man; well not exactly, as he would always remind you. He was forced out of his job when he lost three fingers in an industrial accident. No insurance payments and no redundancy benefits: according to his employment contract he was engaged as a daily labour hand, only he had worked daily for the company for fifteen years. Stephen Onyokia is not bitter with his former employers. “I got what I bargained for,” he says with philosophical resignation. “This brings me to our discourse for this evening: our plight as a people in relation to the dwindling resources of our waterways and rivers.” The old man is so thin you could pick out his ribs in the poor lighting provided by the moon on the Brass beach, tall and of patrician bearing his nose is bulbous at the tip. He speaks with the rasp that is the product of alcohol and eighty five years of living off the river as its resources progressed towards extinction. His story this evening is a popular one in Brass. The oil majors came and were welcomed without any caution or thoughts for the future. Indeed it was they who decided on the need to implement some safety measures in order not to waste the operational environment. As you know, no industrialist would introduce a set of rules that undermines his operations or profit, so the rules were inchoate and insufficient, with the devastating effect on animal and plant life in our creeks, rivers and waterways. We allowed ourselves to be manipulated into this situation. The folks who negotiated the contracts with the oil majors were Nigerians whose communities would never be impacted by negligent oil and gas operations. So where were we the primary beneficiaries and sufferers of the operations? What did I do when for fifteen years an employer kept me as a daily labour hand contrary to our country’s laws? The story of Stephen Onyokia’s exploitation and the despoliation of the Niger Delta Region by the federal government and the oil majors are applicable to Nigeria as a country. Nigeria is an oil producing country of repute supplying oil and gas to Europe, the Americas and Asia. It belongs to OPEC, a cartel of oil and gas producing countries that, as at the end of 2013, controlled 1,206 Billion Barrels or 81% of the world’s total oil supply. Fossil fuels are non-renewable and the civilised world is engaged in frenetic research efforts to develop renewable and alternative sources of energy. Nigeria’s oil and gas authorities have failed to develop a strategy for the sustenance of the country’s energy needs when fossil fuels dry up or when they would become unprofitable and unreasonable to invest in. Take this scenario; presently a litre of PMS sells for between £1.14 and £1.15 in the United Kingdom, approximately NGN328.9 but sells for NGN97.00 in Nigeria. Nigeria has depleted its onshore resources and is now exploiting its offshore and deep sea resources. Nigeria’s NNPC, its oil and gas interface with the world currently costs Nigeria more than a half of the profits realised from oil and gas operations. What structures are we putting in place to be abreast with a world that is pricing fossil fuels optimally within given borders in preparing financially for the inevitable switch to alternatives? Can we sustain this regime of pricing that appears to benefit the masses but actually benefits only marketing companies and criminal elements in the bureaucracy? Are there policies being put in place to reduce the shock on the economy when Nigerians become only buyers of energy products? Is the country prepared technologically for a change in energy types, units and systems? The march towards change in technology or the general evolution of human society does not indulge the indolent; in fact history tells us that it feeds on the indolent. The world knew ships that were powered by oars, then wind (in well constructed sails), then steam, then coal and now fossil fuels. The change from fossil fuels to the next energy source is as inevitable as the progression of time. Nigerians therefore have choices; we can choose to be tossed out in the energy scheme as by an irresponsible company in denial did to Stephen Onyokia or to be dried out of resources like the creeks, rivers and waterways of the Niger Delta, while the North Sea, where oil and gas operations first started is flourishing with salmon and other aquatic life. We can also choose the path of prudence and honour by putting our heads down to plan our transition from energy producers of a kind to energy producers of another kind or at least to energy procurers, prepared and able.

2015 January, SweetcrudeReports