September edition by Sweetcrude reports

Finance

2015 September, SweetcrudeReports

Buhari under pressure to cut spending amid oil-price slump

r e s i d e n t Muhammadu Buhari’s is under a lot of pressure to cut spending in the face of falling oil prices. Having seen the price of oil collapse and Nigeria’s economy grow at the slowest pace in at least five years, he now has to deliver a budget that may make or break his credibility with voters and investors. Analysts say key to his budget challenges will be cutting back on a bloated bureaucracy, which swallows up two-thirds of government spending through salaries, allowances and running costs for officials, civil servants and functionaries. Only 12 percent of Nigeria’s 4.493 trillion naira ($22.6 billion) budget this year was allocated to capital projects. The amount of recurrent spending is “a huge worry for a developing country like Nigeria,” Stanley Achonu, the head of operations at BudgIT, an organisation that works to bring transparency to public spending, said in an interview. While the country can make some savings in the budget, “we can’t halve it,” he said. The government earns about two-thirds of its revenue from the export of oil, the price of which has plunged by more than half in the past year to below $50 a barrel. The last budget passed by Buhari’s predecessor, Goodluck Jonathan, was based on an oil price of $53 a barrel. Buhari “expects a budget where recurrent spending is

…Recurrent spending makes up two-thirds of govt budget

President Buhari

The naira has dropped 7.8 percent against the dollar on the interbank market this year and has been trading in a range of 197 to 199.75 per dollar since the end of March. It was at 199.25 in the first week of September

going to be lower than it currently is, and where there will be more for capital expenditure,” his spokesman Femi Adesina said while discussing the process with the press last week in Abuja. He added that savings will come through cutting waste, rather than firing workers or reducing pay-checks. The budget is due to make its way through lawmakers’ committees in the final quarter of the year.

Firm gets N50m CBN facility for clean energy projects

social enterprise c o m p a n y , SMEFUNDS, has secured a N50 million facility from the Central Bank of Nigeria, CBN, for expansion of its Cellulosic Bio Ethanol Gel for clean cook stoves as well as PayAs-You-Go Smart MiniGrid Electricity projects. According to a statement from the company in Abuja, the facility was

disbursed through Ecobank for delivery of clean, safe and affordable energy for more than one million low income small businesses as well as households across the country. SMEFUNDS is a social enterprise firm that provides access to energy through social investment and promotion of sustainable enterprise development, using social marketing and ethical finance in Africa. The Head, Relationship

Management of MSMED Fund, Development Finance Department, Central Bank of Nigeria, Mr. Tobin while disclosing this to the company, said, “The CBN governor, Mr. Godwin Emefiele has a target that by the end of 2015, half of the fund, which is for the purpose of growing Nigerian economy through small businesses would be given to qualifying companies. “We are looking at the

productive sectors of the e c o n o m y , t h e manufacturing, renewable energy, entire agricultural value chain, services; these are areas of emphasis, where we want to generate employment and production within the economy so that SMEs will begin to produce goods for export and then we begin to earn foreign exchange”.

Plunging oil revenue curbed economic growth to 2.4 percent in the second quarter from 4 percent in the previous three months, and prompted the central bank to impose foreign-exchange restrictions to shore up the currency as reserves dwindled. The naira has dropped 7.8 percent against the dollar on the interbank market this year and has been trading in a range of 197 to 199.75 per dollar since the end of March. It was at 199.25 in the first week of September. “The budget is something Buhari has to get right, and he has to move swiftly on, but as there are still no ministers, it’s going to be difficult,” Laura Barber, an intelligence analyst at AKE Group, said. “Beyond security and his anticorruption campaign, his policy statements are very vague, which causes concern.” In the absence of a cabinet, analysts are looking at Buhari’s previous term in office, when he ruled Nigeria as head of a military junta from 1983 to 1985, for clues on how he will proceed.

2015 September, SweetcrudeReports

Finance

KUNLE KALEJAYE

e t r o l e u m p r o d u c t s marketers in N i g e r i a ' s downstream oil sub-sector are optimistic that their subsidy refunds and interests accumulated under ex-President Goodluck Jonathan government would be paid by the Federal Government soon. Their belief is that once the government is through with verification of their claims, payment would be made to them. ?Chairman, Platinum Alliance, an oil and gas consultancy firm, Sir Uche Iheakanwa, claimed that payment would be made soon. ?"Fuel subsidy will be paid soon after regulatory verification and even before the appointment of ministers, especially that of F i n a n c e w h o s e responsibility it is to fund that account," Iheakanwa said. The actual subsidy figure for payment to marketers is, however, yet to be verified, but Iheakanwa noted that government believes that the regulated price of downstream products must be maintained to forestall any additional hardship imposed on citizens. "This is the reason why DPR (Department of Petroleum Resources) and other agencies have been resilient in tackling those who may want to cheat and still collect subsidy. Despite all the challenges, suppliers still believe in the government as the administration has not given anyone reason to doubt," Iheakanwa said. Meanwhile, despite the

Delia Morris Published in Rigzone

ugust has proven to be a month of extreme volatility for oil prices, but how much of this is based on sentiment and the realities of trading in the dog days of summer when volumes are historically lower, and, therefore, more prone to big market swings? The answer is that almost all the gyrations in price we’ve seen this month are based on factors outside of the fundamentals of supply and demand, and more about thin trading and financial markets that are very skittish about the “real” health of the Chinese economy, the world’s second largest consumer of oil.

Refinery

Subsidy: Oil marketers optimistic govt will pay up none payment of fuel subsidy to legitimate marketers, it has been observed that supply of petrol ?across the country has improved and prices have returned to official regulated price of 87 per litre. Explaining the magic behind the improved supply of petrol i n t h e c o u n t r y , Chairman/Managing Director of Mobil Oil Nigeria Plc, Mr. Tunji Oyebanji, said the change in government was one of the reasons. Oyebanji said banks are now flexible to grant marketers

Despite all the challenges, suppliers still believe in the government as the administration has not given anyone reason to doubt fund to import petroleum products. "Marketers did not hold the nation to ransom when

there was scarcity of the product. We are yet to be paid but the reason why the product is available is that

Rattled by sentiment in August, markets return focus to fundamentals A global stock market selloff occurred this month after the Chinese government repeatedly devalued the yuan and also pumped liquidity into its equity markets. With investors already bracing for a possible U.S. Federal Reserve interest rate hike in September, which many thought might pump the brakes on a 6-year US stock market bull run, markets panicked with the news of Chinese market intervention. With few reliable indicators for the actual health of the

Chinese economy, this action taken by the Chinese government signal;ed to investors that the world’s second largest economy was not what it seemed. As a result of turmoil in global stock markets, oil prices fell to new 6-year lows this month. The U.S. benchmark, WTI, fell below an important psychological threshold of $40/bbl and Brent closed below $44/bbl. In the last week of August, markets have continued to be volatile, but have pared

losses. The Dow Jones Industrial Average, DJIA, gained over 600 points August 26, and the Shanghai Composite Index gained 5 percent August 27. On the back of this news, and possibly with a fair amount of shortcovering among traders, both WTI and Brent rose 10 percent August 27, to settle at $42.56/bbl and $47.56/bbl, respectively. With oil prices in bear

the refineries are now working, NNPC has brought in more products," Oyebanji said. Commenting on the status of the refineries, Oyebanji said their technologies are obsolete, hence they cannot operate beyond 60 percent capacity. He explained that it was government decision to deregulate the downstream sector, noting that the ?cost of transporting crude to the refineries in trucks was not sustainable.

market territory since July, and no apparent near-term potential catalysts to clear the current estimated global oil supply imbalance of about 3 million barrels of oil per day, an upturn in the market does not seem likely until 2016 or later. Both operators and drillers are in cost-cutting mode and activity levels have fallen sharply. However, with service cost deflation for some offshore projects estimated by some analysts to be as much as 30 to 40 percent versus 2014 levels, $55/bbl may be the new $70/bbl (which was typically thought of as the threshold level to sanction major projects).

2015 September, SweetcrudeReports

Finance

Govt earns N2.5tr from petroleum exports in Q2 - NBS OSCARLINE ONWUEMENYI

he Nigerian government earned N2.512 trillion from the e x p o r t o f petroleum products in three months, between April and June 2015, according to data released by the National Bureau of Statistics, NBS. The NBS, in its Foreign Trade Statistics for the Second Quarter of 2015, also stated that the country recorded total merchandise trade of N4.372 trillion and a trade surplus of N1.4 trillion in the months under review. Giving a breakdown of Nigeria’s merchandise trade, the NBS stated that Nigeria’s total export stood at N2.879 trillion, while total import stood at N1.49 trillion, thereby, leading to a trade surplus of N1.39 trillion. The value of total merchandise trade, according to the NBS, was 0.5 per cent less than the total of ?4.393 trillion recorded in the first quarter of 2014 and 34.3 per cent or N2.287 trillion less than the amount recorded in the second quarter of 2014. In addition, the report stated that at N2.879 trillion, Nigeria’s total export appreciated by 8.0 per cent or N214.1 billion when compared with the value of exports in the first quarter of 2015, while it represented a decline of N1.8 trillion or 38.5 per cent when compared with total exports of N4.682 trillion recorded in the second

Oil vessel quarter of 2014. The report noted that the amount the country earned from petroleum products sale in the second quarter of 2015, was 56.8 per cent of the country’s N4.49 trillion 2015 budget. Also the amount earned from the export of petroleum products accounted for 57.5

per cent of Nigeria’s total merchandise trade and 87.3 per cent of total export. The NBS data revealed that the country exported petroleum oils and oils obtained from bituminous minerals and crude oil valued at N2.121 trillion; liquefied natural gas valued at N260.7 billion,

while liquefied petroleum gas and other gaseous hydrocarbons valued at N66.41 billion was also exported. Others are: liquefied propane — N43.88 billion, partially refined oil including crude oil having gone primary refinement —N13.577 billion and

Weakness of Rouble: Russian oil firms raise profits, output

ussian oil firms are increasing their rouble profits a n d r a i s i n g production as a weak currency protects their business, which has turned into one of the world’s most profitable. Russia has kept its production, which includes gas condensate, near post-Soviet highs as its producers benefit from getting the bulk of their export revenues in dollars while most of their

expenditure is in the domestic currency. On last Friday August, Bashneft, a medium-sized Russian oil producer, posted a 13 percent increase in second quarter net profit to 17.9 billion roubles ($272.7 million), following strong results by Gazprom Neft earlier this month. Bashneft, Russia’s fastest growing oil firm by output, saw its average oil production at 387,500 barrels per day, bpd, in the second quarter, up from 350,900 bpd the same period a year ago. Gazprom Neft, the oil arm of state gas producer Gazprom , had earlier reported a 47

percent increase in the second quarter net profit, also on the weak rouble, and its output jumped 25 percent. Net profit at Surgut was flat in the first half of the year at 135 billion roubles. “In our global energy universe, the Russian oils screen (rank) strongly versus global peers on most metrics: highest free cash flow yields, dividend yields, lowest leverage, and lowest sensitivity to changes in oil prices,” Goldman Sachs said in a report earlier this month. Goldman added that current valuations offer an

attractive entry point into the sector, upgrading Bashneft, Gazprom Neft and Rosneft to ‘buy’ and forecasting Russian oil output to grow by 1.1 percent this year. The second quarter results of Rosneft, Russia’s top oil producer, was still expected at the time of filing this report. Global oil prices have fallen below $50 per barrel from over $100 last August, while the rouble dropped to an average of 52.6 per dollar in the second quarter from 34.99 a year ago, according to the central bank.

liquefied butanes — N6.15 billion. The report further stated that, “Other products exported by Nigeria include vehicles, aircraft and parts thereof; vessels among others at ?250.6 billion or 8.7 per cent; Vegetable Products at ?36.7 billion or 1.3 per cent, and Prepared foodstuffs; beverages, spirits and vinegar; tobacco at ?24.6 billion or 0.9 per cent of the totals respectively.” India, according to the report, emerged as Nigeria’s major export destination, with export trade of N406.1 billion or 14.1 per cent of total export. Other top export destinations in the period under review were: Spain, Netherlands, South Africa and Brazil with ?297.4 billion or 10.3 per cent, ?296.3 billion or 10.3 per cent, ?240.9 billion or 8.4 per cent and ?147.8 billion or 5.1 per cent of the total exports respectively. In the area of imports, the report said, “The value of Nigeria’s imports stood at ?1.493 trillion during second quarter 2015, a decrease of 13.6 per cent from the value of ?1.728 trillion recorded in the preceding quarter.

2015 September, SweetcrudeReports

Finance

he Nigerian Extractive Industries Transparency Initiative, NEITI, has said it welcomes with hope and optimism the courageous steps taken so far by President Muhammadu Buhari to reform the oil and gas industry and to restructure the management and administrative organs of the Nigeria National Petroleum Corporation, NNPC. NEITI also endorsed other major decisions by President Buhari on sweeping reforms, including the recent directive on operation of a single treasury account system. NEITI’s noted that it's interest in this new policy is borne out of the fact that over 70% of the funds involved are directly or indirectly generated from extractive industries. It said, "We find the single treasury account policy, a vital move and a major reform - driven decision that would help eliminate fraudulent practices created by multiple revenue accounts by government agencies. "NEITI is therefore glad to identify with the work of the Adhoc Committee of the National Economic Council (NEC) made up of five Governors under the chairmanship of Governor Adams Oshiomole." It added that, "The NEC adhoc committee set up by the President to investigate the inflows and outflows to and from the Federation account by revenue generating government agencies is a right step in the right direction. "This decision is consistent with NEITI’s principles on efficient fiscal allocation, disbursement, value for money by prudent utilization of resources. We therefore appreciate the invitation and opportunity given to NEITI to make presentations to the Committee and to observe its proceedings. We found the sessions of the committee quite productive, open, participatory, interactive, revealing and engaging." NEITI also welcomed President Buhari’s decision to set up a Presidential Committee on AntiCorruption led by Prof. Itsay Sagay, SAN. "The work of this Committee is not only timely but very useful. It is a good platform for all the 21 anti-corruption agencies coordinated by the Technical Unit on Governance and Anti-Corruption (TUGAR) under the Chairmanship of NEITI to share information, and offer informed advice based on experiences over the years.

Gas pipeline

NEITI lauds Buhari over steps to cleanse NNPC, oil and gas industry "It is our expectation that Prof Sagay’s Committee will provide NEITI and all the agencies under the Inter – Agency Task Team (IATT) an opportunity to make presentations," it stated. The watchdog agency said one important issue that NEITI will be bringing to the table if given opportunity is how the Committee can assist

the government to recover over $7 billion owned by oil companies. "These disclosures are contained in NEITI audit reports as cases of under payments, under assessment’s arising from subjective interpretation of MoUs and tax laws. We have no doubt that our contributions will add value to the work of the

committee," it noted. It added that, "NEITI is encouraged that the measures taken so far largely inspire hope and confidence. The measures are also consistent with the f i n d i n g s a n d recommendations of NEITI in its various Independent Audit Reports. These Reports were ignored in the

past," the statement read. It pointed out that as an agency set up by law to implement the global principles of Extractive Industries Transparency Initiative which Nigeria is a signatory, NEITI has a legitimate interest in the ongoing sweeping reforms.

KPMG, PriceWaterHouseCooper probe revenue generating agencies

wo audit firms, KPMG a n d PriceWaterHouse Cooper, have been engaged to carry out forensic audit of all Federal Government revenue generating agencies. Disclosing this in Abuja, Gov. Adams Oshiomhole of Edo State, the Chairman of the National

Executive Council, NEC, Ad Hoc Committee on the Management of Excess Crude Account Proceeds and Accruals into the Federation Account, said the hiring of the firms followed briefings received from some revenue generating agencies of government. "We have agreed in line with our mandate to appoint two reputable international audit firms to

carry out thorough forensic audit, not only of Nigeria National Petroleum Corporation (NNPC), which is more of excess crude, but other monies that accrued to the federation account. "We have other revenues like bonuses, royalties, taxes and VAT that flow into the federation account. We are taking a holistic review of the entire process, looking at all the agencies that make contribution of funds to the

federation account. `"We are convinced that by appointing audit firms, we will allow professionals to carry out this exercise, so that it will be free of any political colouration,’’ Oshiomhole said. According to him, the focus will be on NNPC, the Nigeria Customs Service, Nigerian Ports Authority, Central Bank of Nigeria, Federal Internal Revenue Service, among others.

Labour

2015 September, SweetcrudeReports

Offshore oil rig

SAM IKEOTUONYE

recentlyreleased report on job creation by the National Bureau of Statistics, NBS, and other Federal Government agencies shows that the oil and gas industry created no new jobs in the second quarter of this year. The sector was therefore credited with having zero new jobs in the report by the NBS, which conducted the job creation survey in the quarter in conduction with the Office of the Chief Economic Adviser to the President, National Planning Commission and the Federal Ministry of Labour and Productivity. Overall, according to the

Oil & gas sector created no jobs in Q2 —Report The sector was therefore credited with having zero new jobs in the report by the NBS, which conducted the job creation survey in the quarter in conduction with the Office of the Chief Economic Adviser to the President, National Planning Commission and the Federal Ministry of Labour and Productivity

report, the total number of jobs created in the second quarter 2015 was 141,368, a huge 70 per cent decline from 469,070 jobs created in the economy in the first quarter of the year. It also showed 45.5 per cent decline compared to figures for same period in 2014. In the formal sector, the report showed that 51.070 new jobs were generated, representing 36.1percent of total jobs generated in the period. This is a decline of 61.6percent (79,871) jobs when compared to the first quarter of 2015 and a

35.2percent decline when compared to the same period in 2014. 83.903 new jobs were created in the informal sector in the second quarter, compared to 332.403 new jobs in the first quarter 2015. This showed a 74.8 percent decrease between the two periods. In the public sector of the economy, however, there was a 11.7 percent (669) increase in the number of jobs created, making 6.395 new jobs generated in the public sector in the second quarter 2015.

Why labour is opposed to fuel subsidy removal —Wabba

he Nigeria L a b o u r Congress, NLC, says it is opposed to the total removal of petrol subsidy, maintaining that the Federal Government should rather concentrate on recovery of looted funds and eliminating corruption in the subsidy regime. NLC president, Mr. Ayuba P. Wabba, who

disclosed this, maintained that the current arrangement in the nation's downstream oil and gas sub-sector is inefficient and that the hardship arising from removal of subsidy should not be transferred to the masses. "The current system is inefficient and the hardship should not be transferred to the masses. The system should be cleaned up and then we can look at other issues associated with subsidy

because the current system is not sustainable," he said. He stated that the nation needed a transparent oil and gas sector as every issue in the country is tied to oil. "To run your personal business; to run your car and to run even small and medium scale enterprises, everything depends on oil. Therefore, any increase in price by removing subsidy will have a multiplier

effect. The cost of transportation will go up and every cost is tied to production cost. "There will be increasing costs when poverty is ravaging Nigeria," Wabba said, adding: "I don’t think it (removal of subsidy) is appropriate". He continued: "We should find ways around how to make the system transparent because from the reports of the various audits of subsidy payments, including that of the Nigeria

Extractive Industries Transparency Initiatives (NEITI), a lot of public resources and revenues that accrued to the country have gone into private pockets. "Let them (government) recover those resources. When they recover those resources and the system becomes transparent, we can come back and look at the other associated issues”, he argued.

Labour

2015 September, SweetcrudeReports

NUPENG, PENGASSAN tackle Kachikwu over NNPC reforms

he National U n i o n o f Petroleum and Natural Gas W o r k e r s , NUPENG, and the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, have raised concerns over the approach being used to implement the reform programme in the oil and gas industry. According to the unions, the ongoing exercise does not show any act of fighting corruption and blocking any leakages. The oil workers, who said they were not being carried along in the process, challenged the new Group Managing Director of the Nigerian National Petroleum Corporation, NNPC, Dr. Emmanuel Kachikwu, to recover the stolen trillions of naira in the sector rather than “retiring and sacking innocent workers,” which they described as “an act of coverup.” The unions, in a joint statement signed by the President, PENGASSAN, Mr. Francis Johnson, his counterpart at NUPENG, Mr. Igwe Achese, and their general secretaries, said while they fully supported the fight against corruption, the fight itself should not be turned against workers whom the government swore to protect. They said: “The ongoing exercise portends a great danger in the oil and gas sector, if workers are meant to bear the brunt of government’s current action where the fight of corruption is now used as an act of vindictiveness against workers. “We dare the new GMD of NNPC, Dr. Ibe Kachikwu, to recover the stolen trillions of naira in the sector rather than retiring and sacking of innocent workers. We see the action as an act of cover up. We are quite sure that the ongoing action is not the idea of President Muhammadu Buhari. “We are therefore calling on President Buhari to call the GMD to stop the ongoing sack action in the corporation and set up a team to review his action for justice, equity and fairness which Mr. President stands for.”

Kachikwu The unions said further to their social partner’s status, and as strategic players in all spheres and areas of the industry’s operation, they had been making persistent effort to reach out to Buhari on the issue but were being kept in the dark by those in charge of protocol. “However, our commitment to protect and defend job security and welfare is paramount and cannot be sacrificed. We shall approach it as it becomes expedient whatever government steps and actions that are viewed as dialectical or capable of suppressing our missions and objectives as a labour

movement. “We are being put on the spot as representatives of organised workers in the oil and gas industry to react to the manner that government is now treading

and introducing to carry out change while none of the critical challenges of review of industry policy and fiscal framework, cash call and counterpart funding obligations, stability of the

The ongoing exercise portends a great danger in the oil and gas sector, if workers are meant to bear the brunt of government’s current action where the fight of corruption is now used as an act of vindictiveness against workers

Create environment to stimulate economic growth, PENGASSAN urges govt

he Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, has urged the Federal Government to create an enabling environment that would stimulate economic growth and free flow of investment. Mr Olabode Johnson, National Public Relations Officer of PENGASSAN, made the call in Lagos,

urging the government also to declare a state of emergency in the downstream oil and gas sector. "We need enabling environment that is supported with the provision and security of infrastructure and fair equitable opportunity for players and operators to stimulate the flow that are

required. "Government should declare a state of emergency in the downstream oil and gas sector. "It should also convene an all stakeholders forum to come up with concrete and sustainable steps with reliable time-table for achieving demand-supply equilibrium through local

downstream oil and gas sector, pipeline sabotage, oil theft, that we have presented for immediate attention, are being given secondary attention.” The unions said the gale of abrupt loss of jobs currently sweeping through the NNPC was sending very wrong signals to their members throughout the industry as the issue of job security was making them agitated. They said it was pertinent to state that the present administration promised jobs creation throughout the entire strata of the economy. “However, actions like these are likely to have the opposite effect,” they added.

refining," he said. Johnson said that PENGASSAN was not averse to the deregulation of the oil and gas industry, but should be based on local production, rather than importation. According to him, for deregulation in the oil and gas industry to lead to sustainable development, entrenchment of consistent, stable and globally comparable policy and institutional is needed.

Solid Mineral

2015 September, SweetcrudeReports

Illegal miners

Govt demands solid minerals contribute 10% to GDP in 2 years

he Federal Government has charged the nation’s solid minerals sector to strive to improve its contribution to the gross domestic product, GDP, to 10 percent in the next two years. It argued that the country has abundant mineral endowments to compete favourably with the South African mining sector which contributes 18.7 per cent to its over $365 billion GDP. Permanent Secretary of the Ministry of Industry, Trade and Investment, Alhaji Abdulkadir Musa, who disclosed this in a keynote address at a one-day Sensitisation Forum on Solid Minerals organised by the Bank of Industry, BOI, in Abuja, noted that the sector must aspire to contribute between 5-10 per cent to the GDP. He said, “We should aspire to achieve 5-10 per cent contribution from the solid minerals sector to the GDP within the next two years.” Musa explained that the Federal government had put in place various policies, including the Solid Mineral Development Policy 2007 and the Nigerian Industrial Revolution Plan, NIRP, as a means of creating an investor-friendly

environment for players in the sector. He said that the Bureau of Statistics had in the report on the Nigerian mining and quarrying sector released in January 2014 shown that the sector had contributed 0.09 per cent to the GDP within the period. He assured that as the nation seeks to diversify into non oil base sectors, the government will continue to work with the Ministry of Mines and Steel Development to provide the

We should aspire to achieve 5-10 per cent contribution from the solid minerals sector to the GDP within the next two years necessary incentives and support to investors in the sector. Also commending the

efforts of the BOI as a leading development finance institution, the permanent secretary said, “We are

witnesses to the various laudable endeavours of the bank targeted at converting Nigeria’s competitiveness in a bid to develop the Nigerian economy and create wealth for its citizens.” He maintained that “the bank had been consistent in providing financial and business support services to micro, small medium and large enterprises.”

Buhari says govt will no longer tolerate illegal mining

r e s i d e n t Muhammadu Buhari has warned that the Federal Government will no longer tolerate illegal mining and other improper activities inhibiting the growth of Nigeria’s solid minerals sector. The president gave the warning after being briefed by top officials of the Ministry of Mines and Steel Development, led by the ministry’s Permanent Secretary, Alhaji Umar

Farouk. The president, who noted that the mines and steel sector was very important for the diversification of the economy, expressed displeasure at Farouk’s report that the sector had been overrun by illegal miners. "This is one of the most demoralising briefs I have received. The biggest threat to this country besides the B o k o H a r a m i s unemployment and the mining sector is key to

employment creation. "We cannot be held back on such a strategic industry that can give us much needed jobs and promote economic growth. "There must be more seriousness in running this country and we are determined to instill that seriousness,’’ the President said. The Permanent Secretary had said Nigeria’s mining sector had been infiltrated by “illegal aliens” who carried out unlawful mining

activities in the country. Also, President Buhari directed the Ministry of Environment to undertake a rigorous study of Lake Chad and bring up proposals on how best to reverse the shrinking of the lake. He said it had served as a major source of livelihood for thousands of people. The president gave the directive after receiving a briefing from the ministry’s Permanent Secretary, Nana Mede, the challenges facing the ministry.

Freight

2015 September, SweetcrudeReports

Sea men on safety practice MKPOIKANA UDOMA

he Nigerian M a r i t i m e Administration and Safety A g e n c y , NIMASA, says it has implemented measures to keep maritime activities safe through better operations of the Regional Maritime Rescue Coordination Centre with effective incident management, search and rescue capabilities. Acting Director-General of NIMASA, Haruna Baba Jauro, disclosed this during a workshop for the introduction of new seafarers' medical screening, certification documents and medical fitness organised for

NIMASA steps up on maritime safety seafarers and health providers in Port Harcourt. Jauro, represented at the event by the Eastern Zonal Coordinator of NIMASA, Mr. Anthony Ogadi, said the agency has procured key operational inputs, such as patrol boat ambulances in addition to capacity building of human resources to maintain its activities. He said that the occasion was, therefore, very important as it marked a

milestone in the commitment of the Nigerian government to keeping maritime activities and the marine environment safe through fortification of the internationally recognised seafarers medical certification documents which NIMASA's management developed in collaboration with Nigerian Security Printing and Minting Corporation.

According to him, "This occasion is very important event for NIMASA; it is an occasion in which the agency is strengthening one of its key functions, the administration of safety through the regulatory policy on medical certification of seafarers. "The documents that are being introduced today are more secure documents which were printed with better security features to

Nigeria to become Africa's maritime hub

he Nigerian M a r i t i m e Administration and Safety Agency, NIMASA, has reiterated its commitment to ensuring that Nigeria becomes a safe place for business activities to thrive, thereby achieving the status of being the

maritime hub in Africa. Acting Director General of NIMASA, Mr. Haruna Baba Jauro, said Nigeria attaining the status of ?maritime hub in Africa would require effective collaboration with relevant agencies in the country. Jauro stated this during

the promotion and shipping of stripes of Lieutenant Commander Ahmed Achaka, an officer of the Nigerian Navy posted to the Maritime Guard Command, MGC, at NIMSA's headquarter in Lagos. He said all hands must be on deck to make the

maritime industry attractive, describing the partnership between the agency and the Nigerian Navy as beneficial to the growth and development of the maritime sector and the nation at large.

ensure that medical certificates of fitness for seafarers in Nigeria are authentic and in line with international standard." H e a s s u r e d a l l stakeholders in the sector that the federal government will strive to meet the needs of the sector through better administration of safety standards. He further said that the agency has made efforts in compliance with international maritime laws to which Nigeria subscribe, notably the Safety of Lives at Sea, SOLAS, 1974 and the Search and Rescue, SAR, 1978 conventions, amongst others. He added that to strengthen support for such convention, NIMASA has implemented measures such as "continuous liaison with international and external stakeholders in collaboration with regional bodies to keep maritime activities safe through better operation of the Regional Maritime Rescue Coordination Centre, RMRCC, with effective incident management, search and rescue capabilities as well as procurement of key operational inputs.â&#x20AC;?

2015 September, SweetcrudeReports

Freight

Manufacturers seek ban on importation of dredgers …Accuse NCDMB, BoI of frustrating local manufacturers MKPOIKANA UDOMA

m a r i n e l o g i s t i c s c o m p a n y known as Pisx Investment Nigeria Limited has called on the federal government to invest massively in local content especially in the area of manufacturing. Chief Executive Officer of Pisx Investment, Sen. (Chief) Nimi Amange made the call during the inspection tour of an ongoing construction of a 18 by 16 inch cutter-suction Dredger in Port Harcourt, constructed by Nwakama Dredging Company, at the weekend. Senator Amange, represented at the occasion by a Director of the company, Mr. Aikiba Amabebe, particularly called on governors in the Niger Delta region to key into partnering with local manufacturers to create jobs and boost the economy. According to him, “If an indigenous company can build a dredger of this magnitude, it is their duty to encourage manufacturers like Nwakama Dredging Limited; I expected the Nigerian Content Board to enact a law that can stop Nigerians from importing dredgers.” “The federal government should encourage small scale manufacturers like Nwakama Dredging Company because if they are encouraged they will do more than this; Nigerian content board should give loans to this kind of people so they could do more.” Amabebe explained that the 18 by 16 inch dredger when completed would be used to reclaim 150 acres of land for Nembe in Bayelsa State. He explained further that more money is saved by constructing a dredger here in Nigeria than importing it, because constructing it here would contribute to generating employment for many Nigerians. Also speaking, Rivers State Chapter Chairman of the National Association of Small and Medium Enterprises, Dr. E.D Oko jaja, said the association will ensure that Nigerian content is fully enforced. Earlier, the Public Relations Officer of Dredgers

Manufacturers Association of Nigeria, Mr. Ufoma Dagogo Tom-Smith, who lauded the projects by Nwakama Dredging Company, berated the Nigerian Content Development Monitoring Board over negligence of its functions. “In the dredging industry in Nigeria, the Nigerian content board has failed woefully. If

you want to encourage local content, you should enact laws that will encourage the local manufacturers. For instance, government has enacted laws to ban importation of chicken in order to encourage local farmers. Now, what are the polices that have been put in place in Nigeria in the area of importation dredgers?

“Knowing fully well that here in the Niger Delta, there is no project that can be embarked upon without dredging due to the swampy nature of the terrain – I don’t know about other industries, but I do know that Nigerian Content is not practised in the dredging industry. I have not seen them in anyway

encouraging us, rather they are giving room for people to import,” he said. Meanwhile, the Managing Director of Nwakama Dredging Company, Engr. Elderd Nwakama, who said he has been on the project for the past eight weeks, lamented lack of access to funds as the major setback and challenge facing his job. He also appealed to the federal government to resuscitate the moribund Ajaokuta Steel company and other rolling mills in the country in order to pave the way for indigenous manufacturing to boom.

A dredger

Nigeria promises smooth cargo transit to Niger Republic

he Nigerian M a r i t i m e Administration and Safety Agency, NIMASA, has assured Niger Republic that it will remove all barriers to facilitate seamless cargo transit to that country through Nigeria’s sea ports. The assurance was given by the Acting Director General of NIMASA, Mr.

Haruna Baba Jauro, when the Nigerian/Nigerien Joint Commission on Transit Cargo led by the Director General of the Shippers Council of the Republic of Niger, Mr. Oumarou Issoufou, paid a courtesy visit to the agency in Lagos recently. Jauro also noted that Nigeria and Niger could work together without

barriers to ensure smooth passage of goods between both countries. The NIMASA boss also expressed satisfaction with the activities of the commission, specifically in the area of trade relations between Nigeria and Niger, saying both countries have a lot to benefit from each other on issues concerning trade. Earlier in his address, the

Director General of Niger Republic Shippers’ Council, who spoke through an interpreter, commended NIMASA’s efforts in ensuring safety and security in the nation’s ports and also pledged the readiness of Niger Republic to co-operate with the Nigerian government for the interest of both countries.

2015 September, SweetcrudeReports

Freight

Nigerian port

Maritime Academy of Nigeria denies report of financial recklessness MKPOIKANA UDOMA

he management of the Maritime Academy of Nigeria, MAN, Oron, Akwa Ibom State, has denied allegations of financial recklessness, ineptitude and abuse of office levelled against its rector, Mr. Joshua Okpo. The allegations were contained in a letter to the rector by the Amalgamated Oro Youth Front, a copy of which was obtained by SweetcrudeReports in Oron. as a campaign of calumny aimed at soiling the good image of the school and that of its Rector, Mr. Joshua Okpo. The institution's management described the letter dated August 3, 2015 and titled: "Financial Misappropriation, Fraud, Sex Scandal and Abuse of office of the Maritime Academy of Nigeria, Oron", as "a campaign of calumny aimed at soiling the good image of the school and that

of its rector, Mr. Joshua Okpo".. The Public Relations Officer of MAN, Mr. Sidi Mkpadiok, speaking through a media consultant to the academy, Mr. Ovie Edomi told SweetCrudeReports that the group has failed to understand that the Academy is Federal Government-owned and that Okpo has told them that the institution "is not a national cake for those who have entitlement mentality". Edomi, who described the Oron Youth Front as a "faceless group with entitlement mentality," lamented that if Nigeria wanted growth, development of government institution and patriotism, people whose bread are not buttered should stop embarrassing public office holders and using media men to fabricate stories. According to him, "Before now, key stakeholders in the maritime industry have applauded the way and manner the rector has managed the statutory allocations to the Academy in the last four years. So for a group to suddenly wake up to

Before now, key stakeholders in the maritime industry have applauded the way and manner the rector has managed the statutory allocations to the Academy in the last four years accuse the rector of financial recklessness is to say the least, most uncharitable for a public servant who everybody knows to be open, transparent and altruistic. "For the first time, the President of World Maritime University, Malmo, Sweden, visited the Academy when he got reports that the Maritime Academy of Nigeria, Oron under Okpo leadership was making progress with the upgrading of infrastructure and facilities in line with the upgrading of the

Academy to degree-award status. "When the president of the World Maritime University visited the academy at Oron, he expressed delight with the high level of manpower development, as well as the facilities/infrastructural upgrade and pledged to see that they collaborate with the Federal Government through the Ministry of Transport. "That collaboration is still on and there has been visits by the University team to work with the academy on

curriculum development to ensure standard training of seafarers in line with STCW. "Under the Okpo ledmanagement, the secretary general of International Maritime Organisation, IMO, equally visited the Maritime Academy of Nigeria, Oron for the first time. " The media consultant to the academy explained that several faceless groups have been scheming for an Oron person to be the rector of the Academy in the last five years, forgetting, according to him, that the Academy is a Federal Government institution recognised by IMO amongst the over 500 maritime academies world wide. "Each time, they try to bring up issues that do not hold water and put in the public domain to deceive the public but they end up coming to beg in the end. "Other milestones which the group fails to realise is that there is a Ministerial Monitoring Committee that handles admission into the Academy.

2015 September, SweetcrudeReports

Freight

NIMASA unveils new medical certification for seafarers KUNLE KALEJAYE

he Nigerian M a r i t i m e Administration and Safety A g e n c y , NIMASA, has introduced a new Seafarer’s Medical Certification Documents in compliance with extant requirements of the Maritime Labour Convention, MLC, 2006 and Standards of Training, Certification and Watchkeeping, STCW, 1998 as amended. Presenting the documents to stakeholders in Lagos, the Acting Director General of NIMASA, Mr. Haruna Baba Jauro stated that the current effort at better compliance was one of the key areas in which the agency plays its role of domesticating international maritime laws and conventions that help to keep maritime activities and the marine environment safe. The director general, who was represented by the Director, Maritime Safety and Seafarers Standards Department, Engr. Vincent Udoye, stated that the new documents are more secured as they are printed with better security features in collaboration with the Nigerian Security Printing and Minting Company, NSPMC, to ensure that medical certificates of fitness for seafarers in Nigeria are authentic and in line with international standards. Accordingly, Jauro assured stakeholders in the sector “that NIMASA as an agency of the Nigerian government

Seafarers will continue to strive to meet the needs of the sector through better administration of safety standards in all facets of maritime operations”. In compliance with other

international maritime laws to which Nigeria is a party, notably the Safety of Life at Sea, SOLAS ’74, and the Search and Rescue, SAR,) 1978 Conventions,

the agency has also implemented measures such as procurement of patrol boats, ambulances and priority operational vehicles in addition to facilitating

Transport Ministry raises committee on NIMASA projects verification

he Federal Ministry of Transport has constituted a committee to carry out verification of all projects being executed by the Nigerian Maritime Administration and Safety Agency, NIMASA. The committee has

members drawn from the Federal Ministry of Transport, Federal Ministry of Works and the General Services Unit of NIMASA. According to a statement signed by the agency's Head of Public Relation, Hajia Lami Tumaka, the committee is expected to carry out an

evaluation of all projects currently being executed by NIMASA with a view to ascertaining their percentage completion in relation to funds already released. Speaking on the constitution of the committee, the Acting

Director General of NIMASA, Mr. Haruna Baba Jauro said the evaluation has become necessary given the limited resources available to the agency w h i c h r e q u i r e d prioritisation of projects execution so as to avoid the situation where projects were being abandoned. “We need to set our

capacity building of human resources towards the successful implementation of these conventions.

priorities right as far as project execution is concerned by strategically executing projects even in a phased manner so as to avoid a situation where projects that should have been very beneficial to the development of the maritime industry are abandoned due to poor planning”, the DG said.

2015 September, SweetcrudeReports

Motoring

2015 September, SweetcrudeReports

Upcoming 2016 cars worth waiting for

ll the glitz and showmanship of a new-car introduction doesn’t do you any good when you need a cool-headed assessment to decide whether to replace your current

available at launch: a 2.0-liter, 228-hp fourcylinder turbo, mated to an eightspeed automatic. All-wheel-drive models will arrive first, with frontdrive versions joining by the end of the year. Available safety systems include

car. What follows is Consumer Reports’ take on upcoming 2016 models—separating the substance from the filler. From small SUVs to luxury cars and fuel-sipping hybrids, every category has game-changing models on the way. We’ve identified the more than 40 key vehicles that are all-new entrants—or at least significantly redesigned—and go on sale starting this fall. Many of them will be worth the wait and should be on your must-test-drive list. Stay tuned for Consumer Reports’ thorough testing and evaluation of those vehicles as soon as they hit dealerships.

The base engine will be a 2.0-liter fourcylinder, with the uplevel engine a 1.5l i t e r turbocharged four-cylinder. Buyers can choose from a

Honda Civic: Coming Fall 2015 Car shoppers hated how Honda cheapened its current Civic, and the automaker is rushing a replacement six months ahead of schedule. An all-new platform will have a 3-inch longer wheelbase for more cabin room.

Tesla Model X: Coming Fall 2015 Tesla’s all-electric sevenpassenger SUV will start assembly later this year. It will mark the follow-up to Tesla’s extraordinary Model S sedan, which was the highest-scoring car in our

six-speed manual or a continuously variable automatic transmission. A hybrid will not be offered at launch. Honda claims that the cabin is quieter and more refined. Look for the sedan this fall, followed by a coupe and a fivedoor hatchback. A Type R performance model hits showrooms in 2016.

tests. There will be 70-, 85-, and 90-kWh battery packs available. The 85-kWh should deliver about 200 miles of range. The Model X will have front and rear electric motors, giving it all-wheel drive. Tesla CEO Elon Musk has claimed it will be the fastest SUV ever. The Model X has roof-hinged “falconwing” secondr o w doors for e a s y access to the back two rows of seats.

BMW X1: Coming Fall 2015 The second-generation X1 crossover moves from the rear-drive 3 Series sedan platform to a front-drive

layout shared with the Mini Cooper hatchback. This packaging brings more cargo and cabin room, particularly for rear-seat passengers. Only one powertrain will be

lane-departure and forwardcollision warnings. Base models get a 6.5-inch control display screen, and an 8.8inch screen is optional.

Chevrolet Malibu: Coming Fall 2015 On the heels of its Impala, Chevrolet might have another winner w i t h t h e Malibu. This midsized sedan has adult-scale rear-seat leg and head room. For the driver, o u t w a r d visibility and control layout are improved. Chevy claims t h a t t h e

handling feels sharper and the ride is more refined. Base models get a 1.5liter turbo four-cylinder, and the strong 2.0-liter four-cylinder remains from the current model. A full-

Lexus RX: Coming Fall 2015 Despite its radical styling, the RX follows a familiar redesign formula: Keep the good stuff, but make the popular crossover roomier, more powerful, and thriftier with gas.

The RX will retain its 3.5liter V6, which should make close to 300 hp, but it adds an eight-speed automatic for better fuel economy. A hybrid version will also be offered. The cabin features an optional 12.3-inch screen,

hybrid, using a 1.5-kWh lithium-ion battery and an electric motor mated to a 1.8liter engine, is claimed to get 47 mpg.

accessed via a fussy touchpad on the center console. An optional head-up display provides key information. Rear-seat passengers get more leg and knee room.

CONTINUES ON PAGE 38

2015 September, SweetcrudeReports

Motoring

Upcoming 2016 cars worth waiting for CONTINUED FROM PAGE 37

Also coming soon to a dealer near you Fall 2015 debut • Chevrolet Volt: The Volt goes mainstream, with more conventional controls and three-across rear seating. Look for an allelectric range of 50 miles from the 18.2-kWh battery and a total electric-gas range of 400.

• Nissan Titan: The full-sized Titan initially arrives with a 310-hp, 5.0-liter Cummins diesel engine, giving it the ability to tow

driving position. Toyota says the new model will have improved handling but will keep its serious off-road chops.

Winter 2015 debut • Chevrolet Cruze • Chevrolet Bolt •Honda Ridgeline:

Toyota Prius: Coming Spring 2016 How do you improve on excellence? For Toyota, it’s about eking out even better mileage without straying from what has made the Prius so efficient. Toyota was gunning for 60 mpg, but sources say it will be closer to 55. The successor to CR’s fuel-economy champ will remain a fivedoor hatchback but ride on an all-new platform. Power still comes from a small gas engine and electric motor driving the front wheels, mated to a continuously variable transmission. A longer-range—but pricier—lithium-ion battery pack may be optional over the standard nickel battery.

12,000 pounds. Gasoline V8 and V6 engines will be added later.

• Toyota Tacoma: The updated Tacoma features a new 3.5-liter Atkinson-cycle V6, sending power through either a six-speed manual or a new six-speed automatic. A four-cylinder is also available. In the past, we’ve knocked the Tacoma for its clumsy handling, bouncy ride, and uncomfortable

Cadillac CT6: Coming Fall 2015 The new CT6 is tasked with filling the flagship-shaped void in Cadillac’s lineup. It’s 6 inches longer than its CTS sibling but is shorter than models such as the BMW 7 Series and Mercedes-Benz SClass. The top engine is a new 3.0liter twin-turbo V6; a 2.0liter turbo four-cylinder and

a 3.6-liter V6 are also available. Both V6s come with all-wheel drive; the 2.0-liter is rear-drive only. We tried out the updated Cue infotainment system and found that it reacts and scrolls much faster than the current version. Along with a 10.2-inch touch screen, Cue incorporates hard keys and a touchpad that recognizes handwriting.

Riding on the same platform as the latest Honda Pilot and Acura MDX, look for Honda’s family-focused pickup to sport a more traditional trucky look. Spring 2016 debut • Alfa Romeo Giulia

Technology

2015 September, SweetcrudeReports

Natural gas virtual-pipeline for alternative energy distribution Introduction

irtual-pipeline i s a n alternative method of transporting natural gas to places where there are no pipeline networks available. It is based on a modular system of compression or liquefaction, transport and decompression and/or regasification of natural gas, which communities, industries, gas stations and others can use. In virtual-pipelines compressed/liquefied natural gas is transported by various modes - highway, railway, waterways and the sea. For efficient use the end users â&#x20AC;&#x201C;residential users, the gas stations, and industrial users - should be located near the pipeline; otherwise, extension branches would be costprohibitive. Even users with high potential for consumption could not be using this fuel on account of their distance from existing pipelines.

his was found to be a great problem by gas distributors. Trying to find a solution some companies have developed a new technological option: natural gas supplied through virtualpipelines, which has the great merit of bringing the natural gas to regions not served by conventional pipelines. The virtualpipeline is a system that allows the natural gas transportation in the form of compressed/ liquefied gas using modules coupled to mobile platforms, which are transported by trucks, ferry boats, boats and/or rail platforms. When the product reaches its destination, the module is connected to a decompression/regasificatio n station for ready consumption. The great advantage is that the amount of natural gas transported varies according to the needs previously determined by the customers. In short, versatile systems are supported by n a t u r a l g a s

Virtual pipeline

compression/liquifaction modules, regulation stations and the transportation system itself. For each region a study is performed to determine particular dimensions, where the amount of gas to be consumed is previously determined, e.g., from probabilistic analyses of variables such as: consumption, distances, compliance with the transport, environment and security norms, climate condition, in addition to the technical and economic viability. Thus, the Virtual-Pipelines and their specific features, such as type and storage capacity, means of transportation, compression and/or liquefying, loading, unloading and supplying,

offer the remote customer the possibility of using the natural gas long before a conventional pipeline is constructed. This in turn contributes tremendously to the regionâ&#x20AC;&#x2122;s economic development. In places where there is no natural gas, the industry is limited to work or develop products and services using the energy sources available in the region, and does not keep up with new technologies that can be more economical, with lesser emission levels and greater quality and reliability. The entrepreneurs can - having the possibility to use natural gas in the local market of any region, which is a cleaner energy source compared to the oil byproducts â&#x20AC;&#x201C; develop more competitive goods and services in relation to internal and external competitors, thus stimulating their penetration into new markets.

The Virtual-Pipeline generates the flexibility for a more appropriate industrial location, and the possibility to have better utilization of geographical resources resulting in better cost/benefit relation. Natural gas facilitates the region to dispose goods that would not normally be developed in the region.

his new technology also allows increasing number of GNV (vehicular natural gas) service stations, with a relatively smaller investment, emphasizing that this technology is also employed to other productive and service sectors, of which scattering demand disables the supplying through ducts (condos, commercial centers and small industries). This way, the users of vehicles provided with GNV have more flexibility to drive through the country side of the country, with natural gas available even in places where there are no conventional pipelines. The utilization of the virtualpipeline must not be treated as a steady and definite alternative, but as a faster way to take the natural gas to places where there is no technical or economical viability for the conventional pipeline. Virtual-Pipeline is a passport to new frontiers, consolidating the natural gas consumption and prepares the region for the future utilization of conventional gas supply. Given this case,

the system of VirtualPipeline can be transferred to a new region that needs to be developed. Due to increasing Green house gas concerns, the use of natural gas is encouraged. Additionally, with recent advances natural gas extraction from shale gas has become extremely popular. As sources of NG remain remote from locations of use viable technologies remain: Compressed Natural Gas (CNG), Liquefied Natural Gas (LNG), Gasto-Liquid (GTL) and Gas-to-Wire (GTW). These four technologies promote one way or another, the foundations of a virtualpipeline. In this chapter, emphasis will be on the first two, and the third is a complementary one. The last technology, GTW, is not discussed at length in this paper. The GTW technology consists of the production of electrical energy using turbines of open or combined cycles, close to the place of gas production, and the energy so produced is transmitted to the consumer m a r k e t t h r o u g h transmission cables.

he GTL (Gas-ToLiquids) technology on the other hand, comprises basically of conversion of natural gas into synthesis gas through a reformation reaction using steam (autothermal or partial oxidation) CONTINUES ON PAGE 40

2015 September, SweetcrudeReports

Technology

infrastructure of gas pipelines distribution nets. It also aims to encourage the development of new markets for the natural gas, once it is highly flexible. It must be said that the transportation of CNG is complex and it involves risks of accidents due to the high pressure operation. Basically, the natural gas is taken out first, next the gas is compressed, and later the gas is transported to the purchasing point. As time passed, the demand for gas has increased in all regions, however, its supply through conventional pipelines has not kept up with those needs.

CONTINUED FROM PAGE 39

and subsequent conversion of the synthesis gas (syngas) into synthetic fuel through a Fischer-Tropsch reaction. The synthetic fuel so produced can be viewed as efficient use of natural gas itself, and further can displace oil consumption. Even considering the high costs for the construction of the plant, the value of the utilization of natural gas in the absence of pipeline network becomes attractive considering the low-cost of NG as compared to oil. The benefit of synthetic fuel from GTL is somewhat similar to that from LNG. The LNG, through the cooling results in volume reduction for NG, facilitates its transportation by tank-ships, and subsequently, allows it to be regasified and distributed through pipelines to its final destination. The GTL, in comparison, transforms the NG into a synthetic fuel, which will be supplied as a liquid and used to fuel cars, buses and, possibly, jet engines.

owever, it is necessary to know that the capital investment for the construction and installation of a GTL plant are extremely high. It is estimated that U$ 2,5 bi is necessary to generate only 100 thousand barrels per day; and the thermal efficiency of a GTL plant can only reach 60% (i.e., lots of energy is lost along the process before the fuel can reach the end user). It is important to highlight that the largest consumer of natural gas in the world, the United States, by 2012, has reverted its position regarding the use of new technologies for unconventional NG and has started accelerated exploitation of shale gas. Also, it is said that the brute production of NG in the EEUU is the biggest one in all times, and it has reached 2.500 billion cubic feet on October 2011. It is further estimated that this value will keep growing, mainly due to the abundance of this unconventional gas (shale gas). And also due to the fact that in the case of the shale gas, the oil tanker knows exactly where the shale is the gas is derived economically. This paper primarily discusses the natural gas virtual- pipeline as alternative to distribution of energy in the form of CNG

Virtual pipeline

Virtual-pipeline for alternative energy distribution The virtual-pipeline system is based on modular technology, which in turn allows scaling up of the system proportional to the demand and/or LNG. Additionally, though to a lesser extent, the production of synthetic liquid fuel is discussed as an alternative.

Virtual-pipeline The concept of virtualpipeline aims to distribute the natural gas to places where the physical or economic conditions deem the installation of a real pipeline unfeasible. The so called Virtual-Pipeline consists of the transportation of the Compressed Natural Gas by pressure or liquefaction in the natural form at low temperatures. Once the mean or state of the natural gas is defined (compressed or liquid) for the achievement of the virtualpipeline, it will be transported into modular containers to the unloading plants. This allows the gas to reach the consumer centers in an economically feasible way, competitive or not, in general far removed from the physical pipeline network. It is

important to highlight that the economic coefficient is relative, being necessary to consider several logistical factors, such as effective cost of the diesel transported to these remote places.

atural gas may be distributed in three forms: compressed natural gas – CNG (Natural Gas in its physical compressed state); liquefied natural gas – LNG (Natural Gas in its physical Liquefied state); and, the natural gas hydrates –GNH (Natural Gas in its physical “solid” state). Where the CNG is more commercial and known, it is normally used as direct fuel to internal combustion engines or for heating of processes in industries. The LNG is more expensive and multifaceted technologically, it is also considered as a vector of distribution to great distances. LNG often

proves economically feasible for maritime transportation to great distances. Although, the NGH, i.e., Natural Gas H y d r a t e s , a r e technologically more complex, they are already past the testing phase, and a few plants are already under construction on industrial scale.

Relevant aspects of the distribution via virtualpipeline The virtual-pipeline, as already defined, can be identified as the natural gas distribution through containers, independently of the natural gas physical state. In the event of the virtual-pipeline the compressed state is the most dominant one, i.e., the CNG. In this sense, the CNG is the natural gas processed and conditioned for transport, commonly, e.g., into ampoules and c y l i n d e r s , a t environmental temperature, pressure 70 to 250 bar, with a volume reduction from 60 to 225 times the volume occupied under standard conditions. The virtual-pipeline allows meeting the demand in regions where there is no

s a result a Compressed Natural Gas (CNG) system that can meet the cities’ needs for electricity generators, automotive sector, industries, industrial utilization, etc., is very much the need of the hour. In Russia, for instance, there are large swaths of populations that do not have access to the gas distribution network. As a result, they developed LNG (Liquefied Natural Gas) technology as an alternative transport which allows them to provide these places with natural gas by liquefying the gas, transporting it into trucks or vessels of convoy and subsequently regasifying it for its distribution, obtaining great results for system efficiency. Nowadays there are enterprises working with the CNG or LNG technology. In South America, for instance, companies specialized at working with modular CNG achieve a distribution of more than 4,500,000 m³/month to cities in Argentina. Such companies are intending to enter the Brazilian market together with local distributors in order to supply nearly 600,000 m³/month of natural gas.

Technological aspects of the virtual-pipeline During the technical execution of a virtualpipeline, the CNG can be nominated gas into transitory state, due to the volume reduction and storage into pressure vessels. The supply of CNG in bulk consists of acquisition, receiving, compression, storage, delivery, commercialization and quality control. The CONTINUES ON PAGE 41

2015 September, SweetcrudeReports

Technology

Natural gas virtual-pipeline for alternative energy distribution CONTINUED FROM PAGE 40

virtual-pipeline system is based on modular technology, which in turn allows scaling up of the system proportional to the demand. The VirtualPipeline described here (see fig. 1), is based on 3 technological developments, such as: Modular stations of CNG compression. Modular plants of pressure regulation. Modular system of Natural Gas storage and transport.

irst, a compressor is installed. Later, the CNG loading platforms are set at the place in a dispositive named STM Storage and Transport Module – Tanks measuring 1500 m3; 2.2m x 3.6m x 2.6m. The STM are carried by trucks and transported by land to the unload platforms. Together with the unload platforms a controller plant which will reduce the outlet pressure (200 bar) to the pressure at the distribution net (4 bar). In figure 2, the process of Loading of Galileo Technology is shown. Following is the process of loading and unloading: Head Station: A MICROBOX/MICROSKID (a complete and compact system of intrinsically safe compression), connected to a natural gas source, it can be an existing pipeline, compresses the gas within the STM modules of transport. These are on platforms, called PAC, which allow the fulfillment and interchange between the module and the Transport System

Cryogen technology This system consists of a gas caption station at a certain point, mechanisms for gas compression, injection into special tubes disposed on trucks, and decompression stations at the consumer end. The system developed by Cryogen makes it possible to use the dragging of the tubes as a supplying source for direct consumption, i.e., the supplying source in the industrial line. To avoid the interruption of supplying the empty trailer is substituted by the filled one and taken to the caption point for its reloading. The most important limitation consists of the distance between the caption point and the consuming point. Longer distances with more than 200 km make the alternative

Virtual pipeline

difficult because of cost. Distances between 150 and 200 km are considered ideal. The Cryogen system presents two alternatives for the utilization of CNG: the first one related to the trucks parked at the consumer point that decompress the gas with an independent energy equipment, using the environmental conditions to decompress; the second one uses compressor to keep the necessary pressure at the filling of the vehicular cylinders. The first system – compression, transportation, decompression – for industrial consumption, includes the setting up of the compression system at 250 bar for the filling of the transport unit,

compression systems for the vehicular natural gas (VNG) supplying stations. Figure 8 shows the manner in which the modules of Criogen technology are adapted to the trucks u s e d f o r transportation.

Technological aspects of LNG The LNG (Liquefied Natural Gas) is liquefied by the reduction of its temperature to -162 ºC and regular atmospheric pressure and it occupies around 1/600 the volume of

The standard Cryogen system consists of a transport system equipped with 150 cylinders of 125 liters capacity each, summing up 5.155 m3 of NG each journey the decompression system for industrial use between 2 and 30 bar. The standard Cryogen system consists of a transport system equipped with 150 cylinders of 125 liters capacity each, summing up 5.155 m3 of NG each journey. The second system – compression, t r a n s p o r t a t i o n , decompression, compression – is used directly for the automotive sector. This system is composed by a valve at the caption point, a compression system at 250 bar, filling mechanism, equipment for loading and unloading of cylinders and decompression and

NG in gaseous state. At first, the LNG relative to virtual-pipeline presents basic distribution conditions similar to the CNG, however, distances, volume and financialeconomic analysis are different. Technologically, in the case of its final use in transportation vehicles, the LNG is stored at low pressure into thermally isolated tanks and with capacities that can vary from 174 to 511 liters. The isolation of the reservoirs, even though very effective, cannot keep the temperature low.

he LNG is stored as a cryogenic product, i.e., in liquid state at its evaporation temperature of 162oC. However, due to thermal losses into the storage tank, there is usually some boil off vapor that must be vented to maintain constant pressure. The LNG is transported in towing trucks that carry more than 40 thousand liters, into small cistern and towing trucks, railway wagons and methane ships for LNG with capacity reaching 114 million liters. The towing trucks for LNG are often used to resupply the LNG stations, such as the delivery of gasoil or gasoline. The system consists of deposits of LNG (liquefied natural gas) at the extremities of the “line”, and a series of vehicles making the transportation of it. The same way as gasoline transportation is performed between the supplying stations. Nevertheless, the components are a little more complex considering that the LNG must be kept at low temperatures in order to avoid its evaporation. The containers must have a double covering layer and be isolated by an insulating material developed by NASA, called super isolating “SI”. There are also LNG wagons, but the supplying stations are limited to places with railway access. In the event of the virtual-pipeline, now, the considerate and known technologies are those that allow the delivery of natural gas in both dominant physical states of the natural gas: liquefied and compressed. In this sense the supplying stations for both, LNG and LCNG where, certainly, the LCNG is the compressed

natural gas (CNG) produced from the liquefied natural gas (LNG). For those regions distant from the transportation and distribution system of natural gas, the installation for this kind of stations is advantageous. The LNG, for example, can reach the supplying station by train or highway, in tank-trucks.

inally, the components of a station or substation of LNG and CNG (i.e., LNG and LCNG), are basically: Cryogenic system: it concerns a tank for LNG storage (normally, with a capacity between 50 to 100 thousand liters); Transferring system: it is the tubage (it can be isolated by a vacuum system), the pump, the heating changer, the supplier and the control panel. Thus, a LCNG station (GNLC in Portuguese), compared to the LNG station has one more pump, a vaporizer and a supplier. In the event of the cryogenic and compressed system, the LNG at cryogenic temperature (-162ºC) and low pressure is converted into CNG, having more energy efficiency (less energy consumption) than the compression station. Although, the required power by the system pump/vaporizer is 1/10 to 1/20 of a traditional compression system. It is interesting to mention that for determined transport vehicles, when the necessary autonomy is not reached with the CNG, the use of LNG has its advantages.

*Culled from INTECH

Community

2015 September, SweetcrudeReports

Oil spill

Nigeria records 9,343 oil spills in 10 years ....The world's worst record KUNLE KALEJAYE

igeria oilrich Nige Delta region i s characterise d by a prevalence of both old and new oil spills, over 9,343 incidents in the last 10 year averaging, according to official records. This translates to an average of nearly a thousand spills yearly, the highest rate

of spills globally. Official records between 2006 and 2015 from the National Oil Spill Detection and Response Agency, NOSDRA, indicate that there are over 5,000 spillage sites from the over 9,000 spills. Some of the spill sites, according to the records, include Taylor Creek 2SS flowline between Ayamabele/Kalaba communities, Adibawa well 16T wellhead, Single Point

Mooring 1 offshore floating hose 13, 6Taylor Creek 2Ss flowline near TK 1T well location, 8Nkpoku-Bomu Trans Niger pipeline right of way B, 28 Trans Niger pipeline at Ekporo, 18 Tebidaba/Brass pipeline at Oyeregbene; 24 Nembe Creek Trunkline, NCTL, at Adamakri and Osie65 flowline wellhead location Oshie. Also included are 18 Tebidaba/Brass pipeline at

Oyeregbene, 28" NkpoguBomu Pipeline-Kporgor Tai LGA River State, 18 Tebidaba/Brass pipeline at Oyeregbene 16 and many more. French oil giant Total is the latest company to be hit by oil spill in the country as the company last week reported a spill incident at its ObagiRumuekpe export line in Rivers State, which it blamed on sabotage. The company did not say

NDDC fast-tracks projects, denies allegation of missing N183bn

he Niger Delta Development Commission, NDDC, has restated its commitment to completing all its on-going projects across the Niger Delta region. M a k i n g t h i s commitment while inspecting three projects in Abua-Odual Local

Government Area of Rivers State, the NDDC Executive Director of Finance and Administration, Dr. Henry Ogiri, said the current management of the commission had recorded notable achievements because of its judicious application of financial resources. Dr. Ogiri, who was accompanied by the Executive Director, Projects, Engr. Tuoyo Omatsuli, inspected the

23.5-kilometre OtuasegaObedum-Emelego road project, linking Bayelsa and Rivers states; an e-library and a model primary school in Abua. He said that the commission would remain focused on its mandate to quicken the pace of development in the Niger Delta, in spite of allegations of financial impropriety.

Debunking allegations that N183.7 billion of NDDC funds could not be accounted for between 2008 and 2012, he said the claims in the special audit reports submitted to the National Assembly by the Auditor-General of the Federation, Mr Samuel Ukura, were â&#x20AC;&#x153;premature and misleading.â&#x20AC;?

the volume of oil spilled but maintained that it was losing up to 100,000 barrels per day due to the closure of the export line following the spill. Shell was also recently in the news over a 2011 incident at its Bonga facility, which spilled 40,000 barrels of oil into the environment, and for which National Oil Spill Detection and Response A g e ncy , N OSDR A , ha s ordered the multinational oil company to pay 3.6 billion to the affected communities. Commenting on the spill record as revealed by NOSDRA, Professor John Onwuteaka of the Department of Applied and Environmental Biology at the Rivers State University of Science and Technology, Port Harcourt, said that lack of any openly documented access to spillage sites or spills predating 2006 increases the assumption of many undocumented sites waiting to be detected.

2015 September, SweetcrudeReports

Community YEMIE ADEOYE

ne hundred and fifty youths from the Niger Delta region are to benefit from the 2015 LiveWIRE programme of the Shell Petroleum Development Company of Nigeria Limited, SPDCoperated joint venture. SPDC said the scheme is aimed at boosting local capacity development in entrepreneurship across the region, adding that the latest beneficiaries will bring the total number of beneficiaries under the LiveWIRE programme to over 6,000 since the launch of the programme in 2003. LiveWIRE is a flagship youth enterprise development programme which provides access to training, business development services and start-up capital. “LiveWIRE presents a good opportunity for bright young people to bring their ideas to fruition,” said SPDC’s General Manager External Relations, Igo Weli. “We are pleased to see the youths transform to employers of labour after going through intensive business training that is reinforced with theoretical and practical sessions.” The two-week training slated for later in September will be held for the selected youths in Rivers, Delta and Bayelsa states. Media Relations Manager of Shell, Mr. Precious Okolobo, said in a statement that the programme is open to university and polytechnic graduates with innovative business ideas from the three states. The curriculum includes Business Planning and

Shell to train 150 Niger Delta youths in enterprise development

Training session

We are pleased to see the youths transform to employers of labour after going through intensive business training that is reinforced with theoretical and practical sessions

Management and post startup mentoring, incubation and market linkages. Successful candidates will be linked to third parties such as NGOs, banks, and allied financial institutions and provided a volunteer mentoring programme. In 2014, the Livewire scheme was broadened to include a specific focus on people with physical impairments. Some 180 disabled people had already

benefited from training and grants by the end of the year. Shell Companies in Nigeria work with government, communities and civil society to implement programmes that have a lasting impact on lives in the Niger Delta and beyond. Social investment activities are focused in particular on community and enterprise development, education and health.

Army seeks NDDC support to sustain peace in N'Delta

he immediate-past a n d n e w commanders of 2 Brigade, Nigerian Army Barracks in Port Harcourt, Brigadier General Koko Essien and Brigadier General Stevenson Olabanji, have commended the Niger Delta Development Commission, NDDC, for co-operating with security agencies working in the Niger Delta

region. The two commanders were recently at the commission’s headquarters in Port Harcourt on a courtesy visit to the NDDC Managing Director, Sir Bassey Dan-Abia. Brig-Gen. Essien, who has been redeployed to the headquarters of the Nigerian Army in Abuja, charged the NDDC management to continue to support the military forces in the region. “I

appreciate the support the NDDC gave to me and I hope that it will be extended to my successor,” he said. He stated that he was handing over to an infantry commander, who was well equipped to tackle the challenges of maintaining peace in the Niger Delta, assuring the commission that the new commander would contribute his own

quota in providing the peaceful environment necessary for sustainable development to thrive. In his own remarks, the new commander, Brig-Gen. Olabanji, said he had always been interested in the activities of the NDDC as a son of the Niger Delta. He promised to sustain the cordial relationship between the Army and the

commission. “I will do everything that is necessary to maintain this mutually beneficial relationship,” he said. Responding, the NDDC Managing Director, Barrister Dan-Abia, said that it was significant that the two army commanders chose to visit the commission together.

2015 September, SweetcrudeReports

Community

Illegal refinery

MKPOIKANA UDOMA

he Nigerian Army says it has uncovered massive illegal oil bunkering site situated one kilometre away from the Nigerian Ports Authority, NPA, location in Port Harcourt. Commander of 2 Brigade of the Nigerian Army in Port Harcourt, Brigadier General Stevenson Olabanji said thousands of litres of illegally refined diesel were discovered at the site. He said army operatives were, following a tip-off from good Nigerians, immediately

Oil Theft: Army uncovers illegal bunkering site in Port Harcourt deplored to the site at Magcobar Beach, which is less than two kilometres away, from the Rivers State Government House. According to him, “About 16:40 hours on Monday (August 31), we got an information that some illegal bunkering activities were going on along Magcobar Beach. “On arrival, our personnel discovered illegal activities which involved bunkering (of

illegally refined petroleum products) and lifting of diesel to local boats. “At the site, we found over 5,000 drums loaded with illegally refined diesel; four tanker trucks containing 132,000 litres of diesel combined and a barge with 165,000 litres of stolen diesel. “This discovery is unprecedented because since we started our operations 10 days ago, this

is about the biggest that we have uncovered,” he said. Olabanji said that 150 drums loaded with about 3,150 litres of diesel was also discovered in 21 Cotonou boats. He explained that 13 suspects were arrested at the scene of the illegal facility, but the illegal bunkering site has not yet been set ablaze (in line with the Joint Task Force mandate) because of its closeness to residential

NNPC to explore community-based pipeline protection model

h e G r o u p M a n a g i n g Director of the Nigerian National Petroleum Corporation, NNPC, Dr. Ibe Kachikwu has hinted that the Corporation may settle for the option of community based policing to protect the vast artery of oil and gas pipeline network across the country. Speaking while receiving Ambassador Perry John Calderwood the Canadian High Commissioner to

Nigeria, during a courtesy visit to the NNPC Towers, Abuja, Dr. Kachikwu pledged to give a lot of attention to the perennial menace of pipeline vandalism and oil theft. "I intend to give a lot of energy to the issue of oil theft and pipeline vandalism. We must keep the losses from oil theft to the lowest figure possible. I don’t believe in the arm -for-arm approach, we must engage the host communities and inculcate in them the need to see the assets in their domain as their own,’’

Kachikwu said. The GMD noted that in the months ahead, the Corporation would initiate discussions with community leaders and interest groups with a view to fashioning a workable community oriented pipeline protection format with less emphasis on the use of brute force to secure the lines. On the state of the refineries, the NNPC helmsman solicited for support from Canadian

companies and service providers stating that Nigeria could make do with Canada’s vast experience in refining and expertise in oil and gas operations. In his response, Amb. Calderwood said the Canadian government and business entities are willing to work with the NNPC in growing the Nigeria oil and gas industry to enviable heights.

buildings and the NPA. “Our mandate requires us to destroy the site at once, but we cannot do this because it will degrade the environment and affect residents as it is situated in the heart of Port Harcourt. “Our plan is to move them to a safe location for destruction,” he said. The commander said that preliminary investigation had already begun to unravel sponsors of the facility, adding that the 13 suspects would be handed over to relevant authorities for further investigation and prosecution. Olabanji, who called on members of the public to provide the JTF with timely information which could lead to the arrest of oil thieves and pipeline vandals, warned against sabotage of oil and gas installations by oil thieves, and assured that the JTF would not relent in its task to rid the state of illegal bunkering activities. “Let it be known that the army will not and will never tolerate illegal bunkering in our area of responsibility,” he assured.

2015 September, SweetcrudeReports

Community

UNEP Report: MOSOP warns politicians against sabotaging clean up MKPOIKANA UDOMA

he Movement f o r t h e Survival of Ogoni People, MOSOP, says it has uncovered a plot by "internal and external politicians and their cronies" to politicise the planned Ogoni environmental remediation and restoration process to advance some parochial political and economic agenda capable of thwarting the success of the exercise. Speaking in Port Harcourt, President of MOSOP, Mr. Legborsi Saro Pyagbara, warned those involved to steer clear of the i m p l e m e n t a t i o n arrangements as any attempt at undermining the process would be viewed as

affront against the collective interest of the Ogoni people and will be decisively resisted. Pyagbara also threatened to expose those whom he described as 'external collaborators' who are providing resources including their platforms for the devious agenda. "We insist that the environmental degradation of Ogoniland, which has compromised our general wellbeing, is not a political issue, and dragging the fasttracking actions into the murky waters of politics demonstrates inexcusable callousness that should be condemned by all especially lovers of safe and clean environment. “We have come a long way, and we therefore urge all Ogonis to come together irrespective of interest as we

We have come a long way, and we therefore urge all Ogonis to come together irrespective of interest as we cannot afford to falter at this time of seeming genuine interest of government to redress the environmental wrongs against the Ogoni people cannot afford to falter at this time of seeming genuine interest of government to redress the environmental wrongs against the Ogoni people. We therefore urge all Ogoni people to heed our advice as we would resist all

attempts to frustrate efforts at ensuring environmental justice for our people." “The condition in local Ogoni communities where the people reap deaths and face crushing livelihood questions should bother us all. It is in the realisation of

this that we would have no choice than to sustain our mandate of organising the Ogoni people for the movement from the Egypt of environmental injustice to the Canaan of environmental security. Those who may think otherwise, no doubt, are entitled to their opinions but must be mindful of the consequences of overreaching their bounds,” he said. In the same vein, the Council of Ogoni Traditional Rulers, COTRA, appealed to President Muhammadu Buhari and the Federal Government not to leave any stone unturned in ensuring the full implementation of the UNEP report in accordance with the recommendations contained in the report.

PUBLIC NOTICE INTERLOCUTORY INJUNCTION RESTRAINING FURTHER EXECUTION OF EGINA FPSO BY TOTAL, SAMSUNG & OTHERS

n the 2nd day of May, 2015 the Federal High Court in Lagos in Suit No. FHC/L/CS/1768/2014 granted interlocutory orders of injunction against SAMSUNG HEAVY INDUSTRIES NIGERIA LTD; TOTAL UPSTREAM NIGERIA LTD and others restraining them either by themselves or through their agents, privies, proxies, affiliates or subsidiaries from:

(I)

continuing or taking any further action or step towards the execution of the award of the contract for engineering, procurement, construction and commissioning of a Floating Production Storage and Offloading Unit FPSO in the Egina Field within OML 130 (Egina FPSO Contract) pending the determination of the substantive Suit;

(ii)

giving effect to and implementing the award of the aforesaid Egina FPSO Contract either by way of operating/executing same, or dealing in any way whatsoever and howsoever with the aforesaid Egina FPSO Contract pending the determination of the substantive Suit.

Since then, committal proceedings have been commenced against the following persons for DISOBEDIENCE OF THE ABOVE ORDERS OF THE HONOURABLE COURT: (i) (ii) (iii) (iv) (v) (vi)

Mr. K. S. Lee Managing Director, Samsung Heavy Industries; Samsung Heavy Industries Nigeria Limited; Dr. Kayode Olatunji Olowolafe, Managing Director, Deux Project Limited; Deux Project Limited; Mrs. Elisabeth Proust, Managing Director, Total Upstream Nigeria; and Total Upstream Nigeria Limited.

The general public, particularly the financial institutions funding the above referred Project are hereby warned that the orders of the Honourable Court are still subsisting and all persons are legally obligated to comply with same. Any person (corporate or individual) that acts contrary to the orders of Court will be in contempt and be proceeded against accordingly.

Enitan Associates Legal Practitioners & Arbitrators The Blue 10A, CMD/Jubilee Road Magodo GRA, Lagos. + 234 (0) 803 777 1703; + 234 (0) 704 533 2441

2015 September, SweetcrudeReports

Community

We have spent N160bn on NDDC, says Mobil MKPOIKANA UDOMA

o b i l Producing Nigeria Unlimited , MPNU, a subsidiary of ExxonMobil, says it has contributed over N160 billion to the Niger Delta Development Commission, NDDC, since its inception in 2001. Manager, Media and Communications of Mobil Nigeria, Mr. Ogechukwu Udeagha, disclosed this in Uyo during a two-day capacity building workshop for newsmen in Akwa Ibom. The workshop which was sponsored by Mobil, has the theme: “Professionalism, media ethics and responsibility in sustaining democracy and deepening oil and gas operations reportage.” Udeagha said that the company had contributed over N16 billion to infrastructure development in Akwa Ibom alone in the last three years, adding that as a major player in the petroleum sector, the company had sponsored annual athletics championships and science quiz for secondary schools in Akwa Ibom State. "The company has also offered scholarships to undergraduate and post graduate students as well as sponsorship of Graduate Assistance Programme for unemployed graduates. "Other programmes sponsored by Mobil included refresher training for primary and secondary school teachers and economic empowerment programme for women," he said. The manager also announced that Mobil would assist the state council of the Nigeria Union of Journalists in building its mini-club house. Udeagha appealed to the media to remain professional, ethical and socially responsible in the reportage of oil and gas business, given the global crash in oil price. Chairman of the event and

Vice Chancellor of Obong University, Prof. Udoudo Ekanemesang, in his remark said media practitioners were very powerful people that could make or mar the world,

urging the media to uphold the responsibility to educate the public seriously. “The media is the guardian of public interest.

The media invariably is expected to hold elected officials and political office holders accountable for their actions or in-actions. “The press has another

social responsibility of promoting human rights; everyone’s human rights, especially during periods of political u n c e r t a i n t y , ” Ekanemesang said. He further advised the media practitioners to adhere strictly to the ethics of the profession by being fair, truthful, factual, and of high integrity in the reportage of events.

ExxonMobil office

Ogoni decry insecurity in communities

n a t i o n a l congress of the Ogoni people organised under the auspices of the Movement for the Survival of the Ogoni People, MOSOP, has decried insecurity in Ogoni communities and called on traditional rulers to ensure the protection and security of the communities. This is part of a six-point communique issued at the end of the congress and read by the President of MOSOP, Mr. Legborsi Pyagbara. "The Congress decried the present situation of

insecurity in Ogoni communities and called on traditional rulers to ensure the protection and security of the communities," the communique read. The meeting, which held in Bori-Ogoni, was attended by over eight thousand Ogonis, including traditional rulers, academics, traders, farmers, fishermen, professionals, youths and women, and was aimed at briefing and stimulating discussions on the approval by the Federal Government regarding fast-tracking implementation of remediation and restoration of the hydrocarbon-

d e g r a d e d O g o n i environment. In the communique, the Ogoni also called on President Muhammadu Buhari to ensure that all mechanisms necessary for the urgent commencement of remediation and restoration of the devastated Ogoni environment are put in place without delay. The communique also appealed to President Muhammadu Buhari and the Federal Government to appoint Ogonis into position of national leadership. "The Congress called on the president to ensure that all mechanisms necessary for the urgent commencement

and comprehensive remediation and restoration of the devastated Ogoni environment are put in place without delay. "Whilst appreciating the intervention of the President on the UNEP Report, congress called on the president to appoint Ogoni sons and daughters into positions of responsibility in his government as demanded in the Ogoni Bill of Rights and reiterated in the recent letter to the President by the Ogoni People," it said.

Community

2015 September, SweetcrudeReports

E-mail: johniyene@yahoo.com

The Petroleum Act, Federal Allocations & the Descent into Financial Anarchy

Niger Delta Youth forum

Niger Delta youth group slams NDDC over missing fund

he Managing Director of the Niger Delta Development Commission, NNDC, Sir Bassey Dan Abia, has incurred the anger of a Niger Delta youth group with his comment that no money was missing in the commission under his watch. President of the group, Mr. Amateri Bidekpele, called on the National Assembly to invite Dan Abia and his management team to explain alleged contract awards to relatives and cronies. He said the aggrieved Niger Delta youths want to bring to the notice of the public that the era where public servants handle public office as their personal estate is over. According to him, "We want them (NDDC) to appear before a public account committee in the National Assembly; it is not enough for him (Abia) to say that 'no money is missing', it is not

enough for him to say 'the statement is misleading', it is not enough for him to say he is not part and parcel of contract splitting. "For a Managing Director of NDDC to say he is not part and parcel of this and that while those things are going on in NDDC, so what is the criteria of him being an MD? That means he is not qualify to be an MD, therefore he needs to be probed." Bidekpele also stated that in line with President Muhammadu Buhari's anticorruption stance, the Federal Government should probe the NDDC boss' comments when he appeared before President Buhari. He added: "His (Dan Abia) statement is misleading, his statement is contradicting in the sense that when he said he was not the MD as at 2008 to 2012, then why did he counter the reports of the audit of 2008 to 2012?" "Secondly, he also

dissociated himself from contract splitting which is a major problem in NDDC, and he said he is not part of it. Thirdly, the auditor report that he is faulting, what is the basis of faulting that report when he said that he was not part and parcel of the NDDC as at 2008 to 2012". It would be recalled that the Managing Director, Niger Delta Development Commission, Mr. Dan Abia, had described as false the allegation raised by the Auditor-General of the Federation, Mr. Samuel Ukura, that over N183.7 b i l l i o n w a s misappropriated by the Commission. Ukura recently said that money had been diverted by the commission, following an audit report of special check on NDDC from 2008 to 2012.

t might have started as a misinterpretation of the forays of British Petroleum and Amoco in the Middle East or as the Gowon’s Supreme Military Council claimed, an expediency to prosecute the Nigerian civil war but several decades after the war, Nigeria has maintained an immoral regime of federal allocations, the subjects of which are “earnings from crude oil and gas sales” from products found in select locations of the Nigerian State. Economists, sympathisers and the people of the Niger Delta have protested forever, the incongruity and injustice of this arrangement but the managers of the Nigerian State have maintained it to the detriment of the development of the full potential of the federal government and the federating units to mobilise revenue for governance. In the early days of Muhammadu Buhari’s presidency, the Nigerian public was shocked to learn from the newly elected officials that the federal government and almost all the states were stone broke as a result of budget deficits; a direct consequence of the fall in oil prices. Nigerian policy makers predicate their budgets mainly on expectations of earnings from crude oil and gas sales, not on tax as is done universally so that a country of about 178 million people, excluding the hundreds of thousands of corporate citizens are not able to raise an income base that can amount to half the tax base of South Africa that has a population of 53 million. This system of federal allocations has expanded Nigerian bureaucracies unduly, enthroned greed, indolence and the failure of taxation as a means of governance. In South Africa, the diamonds and minerals industry alone provide the country and states with prospecting license tax, operational tax or mining tax, mineral royalty, company tax and income tax! In one industry alone!!! Before Nigeria discovered crude oil, the Northern Region was run purely on tax realised from agricultural produce; ditto for the Western and Eastern regions. The difference was only in the products or produce. By virtue of the Petroleum Act and certain provisions in the Nigerian Constitution, the federal government, the 36 states of the federation and all 774 local government authorities are statutorily entitled to a monthly largesse from oil and gas sales. These monies accrue to the governments, not because of monies or resources they invested but because the constitution names them as parts of the federation of Nigeria. The direct result of this system of distributing unearned income was the scramble for more and more states and LGAs, their viability and survivability not factored as those important considerations hadbeen underwritten statutorily by a constitutional document; an indirect but certain consequence is the failure and foreseeable demise of the taxation system. Imagine a Nigerian economy run by the federal government purely with tax earnings and in which the states run their economies independently with earnings realised within their borders. This system of federal allocations has blunted the creative spirit of the famous Nigerian technocrat. At the peak of his career, Allison Ayida, was adjudged to have the competence of German statesmen like Klemens Von Metternich and Otto Von Bismarck. What kind of technocrats does Nigeria produce these days? Pretentious auditors who snoop around investigating and tracking other peoples billions and donating other peoples’ money to their kin instead of developing strategies for expanding the income streams and bases of their governments. As an immediate palliative, President Buhari approved the distribution of funds lodged in the excess crude account (of course, crude!!!) to assuage the financial difficulties faced by the states. How well and how far can this rape on the Niger Delta continue to sustain Nigeria’s economy? Already, oil has become replaceable with wind, solar energy, octane, steam, nuclear energy and many other renewable options and Iran which had been an international pariah would soon join an already glutted market where prices are downward bound. Intelligent people should start asking themselves how Nigeria can sustain her increasing needs with dwindling resources. In every way that it is possible to examine it, it is clear that the Petroleum Act and the system of federal allocations practised in Nigeria have been more of curses than blessings to the Nigerian people. The federal government was only designed to make enough money to underwrite her minimal operations and to act as a neutral arbiter and common representative for all the federating states. This novel role of income distribution it assumed ostensibly to serve as an agent of bridging inequities is Nigeria’s diving board to her certain descent into anarchy.

2015 September, SweetcrudeReports