Shale gas and Nigeria's ill-preparedness by Sweetcrude reports

Contents

2013 July, SweetcrudeReports

Editor’s note

he world is caught up in a frenzy about shale gas. For some countries, it is all about exploring and exploiting the new-found resource to curtail their continued over-dependence on foreign energy. For others, it is about adjusting national policies and priorities to contain the threat of the Shale revolution. On all fronts, urgency has become the word. But at this time when world attention has come to centre on the unfolding revolution, the import of this phenomenon for the Nigerian oil and gas industry seem to be lost on those superintending the sector in Nigeria. While a peep into the international oil market indicates huge danger for Nigeria and its crude oil and gas on account of the coming of Shale gas, a similar peep back home would show uncertainty, indignation and indeed a resignation to fate on the part of those involved in policy formulation and execution in the nation’s oil and gas sector. Worse still is the pretension that all is well and very much under control. From a high of 1.1 million barrels per day, Nigeria’s oil supply to US has dropped to a paltry 360,000 barrels per day as at February this year. Fears are that this might plummet to 140,000 barrels daily before the end of the year and possibly to zero level by 2015. All these, happening mainly because of US’ commencement of Shale gas

production, are a clear confirmation that the threat of Shale gas to Nigeria’s oil and gas is real and demands immediate, concrete action on the part of those at the helm of affairs in the oil and gas industry. This is a call to the Petroleum Resources Minister, Group Managing Director of the Nigerian National Petroleum Corporation, director of the Department of Petroleum Resources and other industry eggheads to wake up and face reality. The threat of Shale gas is real! For the Nigeria Maritime Administration and Safety Agency, NIMASA, and the Nigerian Liquefied Natural Gas Limited, NLNG, the crisis and drama over payment, or rather non-payment, of statutory levies and charges due to the former continue. The intervention of the judiciary has not helped resolve this matter, but may we ask, is there anywhere in the world an LNG company is not paying statutory taxes due to government or its agencies? While still awaiting an answer from the NLNG, we welcome you to this edition. And we assure you a pleasurable copy. Look out for our exclusive interview with High Chief Government Ekpemupolo, the ex-militant leader more popularly known as Tompolo; as well as our expose on the electricity inverter, which we consider a life changing technology for Nigeria and indeed Africa’s electricity supply challenge.

COVER 4 Shale gas and Nigeria’s ill-preparedness 7 OIL SPDC JV debunks false claims on TNP oil spill and fire 13 FOCUS 17 GAS Brass LNG makes progress, resolves funding challenges 20 POWER Siemen partner Proton Energy on 500mw power plant Only Government can stop pipeline vandalism

24 28

FINANCE

32 34 39 41

SOLID MINERAL

Diamond Bank’s $550m bond fails to attract interest abroad

LABOUR

NUPENG, PENGASSAN blame Petroleum Minister for industrial unrest Lack of raw materials, infrastructure stifling Ajakuta steel

FREIGHT

NIMASA moves to stop forgery of Certificate of Competency

MOTORING

Nine hottest selling cars in 2013

TECHNOLOGY

The inverter: Solution for Africa’s electricity crises

COMMUNITY

Shell under pressure over Niger Delta oil spills

SweetCrude REPORTS

EDITORS Hector IGBIKIOWUBO Chuks ISIWU

ASSISTANT EDITORS Yemie ADEOYE Toju VINCENT Eluonye KOYEGWUAEHI

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

Design/Layout Frontline Concept

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

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2013 July, SweetcrudeReports

Cover Story

2013 July, SweetcrudeReports

CHUKS ISIWU

he shale gas revolution and U S o i l independence portend grim prospects for countries like Nigeria where US imports account for a sizeable chunk of crude oil purchases. It may well mark an end to the nation’s oil boom. U n f o r t u n a t e l y, t h o s e charged with the responsibility to superintend the oil and gas industry have failed to respond to the Shale gas challenge. Oil export to US may drop to 140,000b/d Barely two years ago, Nigerian crude oil supplies to US refiners topped 1.1 million barrels per day. By January 2013, 27 cargoes had not been lifted and crude oil supplies from Nigeria to US refiners had dropped to a paltry 360,000 barrels per day. Current indications are that this figure could drop to 140,000 barrels per day before the end of the third quarter of the year and possibly to zero level by 2015. And this is happening because oil from shale gas extracted in the US is replacing Bonny Light and other variants of Nigerian crude. Having come to terms with the shrinking US market, Canada, another major supplier of crude oil to the US, has since moved quickly to secure market in Europe for its crude. As recently as 2011, close to 100 per cent of Canada’s crude exports went to its neighbour the United States, according to the US Energy Information Administration, EIA. Trade and shipping sources, however, said more than 2 million barrels of light crude from Canadian offshore oilfields have gone to Europe in the last month. The changing pattern in global oil demand has pushed countries including China into new strategic and economic alliances, said Katherine Spector, head of commodity strategy at CIBC World M a r k e t s i n N e w Yo r k . According to her, "It has changed the way oil flows around the world. We now see virtually no West African (Nigeria/Angola) crude going to the United States".

An offshore rig

Shale gas and Nigeria’s ill-preparedness The changing pattern in global oil demand has pushed countries including China into new strategic and economic alliances, said Katherine Spector, head of commodity strategy at CIBC World Markets in New York No policy statement yet from FG The gravity of all these, however, seem to be lost on

Nigeria and those superintending the oil and gas sector, whose reaction to the Shale shock appears confused. So far, there has been no policy

statement from the government on the threat. Analysts insist Nigeria is illprepared to confront the problem. And this may not be far from the truth. At the 2013 Nigerian Oil and Gas Conference, NOG, in Abuja earlier in the year, both the Petroleum Resources Minister, Mrs Diezani AlisonMadueke and the Group Managing Director of the Nigerian National Petroleum Corporation, NNPC, Mr Andrew Yakubu, took to doublespeak on the matter. At the event, the duo separately held the view that shale gas

posed no problem to Nigeria and its crude. But, yet at the same event they were later to declare otherwise. "There is no doubt that shale gas has come and is with us, we also know that it is posing a challenge to the oil and gas activities in Nigeria. With the coming up of shale gas there has been a drop of pipeline imports from 16 to 12 per cent while shale gas has grown from 8 to 32 per cent, and LNG import has dropped from 3 to 1 per cent, which is mainly Nigerian LNG.

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2013 July, SweetcrudeReports

Shale gas and Nigeria’s ill-preparedness CONTINUED FROM PAGE 4 "So there is no doubt that shale gas is a challenge to us. With the various energy mix and shale gas continuing to grow and contribute significantly to the global oil supply as we have seen, of course it will challenge our own oil and gas," Yakubu said at the conference. The big issue is how to get Nigeria's crude now rejected by the US into a new market. Industry watchers are worried that there appears to be no concrete plan by the government in this regard. Reacting to suggestion that Nigeria could seek new markets for oil in China at the recent Organisation of Petroleum Exporting Countries, OPEC, meeting, Alison-Madueke maintained that China would not be a longterm panacea for Nigeria. “Asia itself will still have growing energy needs for quite a while, but remember that China itself may be discovering shale gas pretty soon, and oil,” she told reporters on the sidelines of the meeting. She did not provide the option being explored by the government. E n q u i r i e s b y SweetcrudeReports at the Ministry of Petroleum Resources and the NNPC as to what the authorities were doing to address this matter did not yield any clue. An NNPC official, who pleaded anonymity, spoke of "uncertainty and a sort of helplessness" on the part of the Petroleum Ministry and NNPC officials in addressing the Shale gas challenge. "Honestly, all is not well. It is really not certain how we are going to overcome this problem. Anyone telling you there is a plan and a solution already worked out is lying," the source said. The bigger challenge is that Nigeria depends on the oil and gas for about 95 per cent of its export earnings and about 80 per cent of its revenue even as the government aspires to grow oil reserves to 40 billion barrels and production to 4 million barrels per day, b/d, and earn as much income from gas as oil by year 2020. In the face of the shale

A gas metering station threat, industry watchers say, these aspirations may well become a mirage. Managing Director and Chief Executive Officer of Shell Nigeria, Mr Mutiu Sunmonu, recently expressed worry about the shale gas development, asking oil and gas producers from subSaharan Africa to begin to ask questions as to how this has affected them and how to get out of the logjam. According to Mike Onyeanu, chief executive officer of Lagosbased oil services firm, Januits Petroleum Resources, the real problem before Nigeria now is that there is no concrete plan regarding response to the shale gas phenomenon and its threat to the nation's crude, its oil revenue and the economy. This, on its own, presents a great danger. Going by this year's budget, for instance, Nigeria projected a revenue of N11.34 trillion. This is based

on 2.53 million barrels per day oil production and $79 per barrel oil price. Prices have remained well above the projected price but with export volume to US dropping to 140,000 barrels per day as has been projected for the third q u a r t e r, t h e F e d e r a l Government would be losing vital revenue that should otherwise go into development. Local refining, the only option - Experts In the face of this obvious quagmire, energy experts say the only way to go now is to add value to crude oil production via local refining, or risk losing market and suffering dwindling fortunes. "It’s time to think inwardly. Refining all our oil locally is certainly the way to go. It is like using one stone to kill two birds. In refining all our oil locally, we are insulating

It’s time to think inwardly. Refining all our oil locally is certainly the way to go. It is like using one stone to kill two birds. In refining all our oil locally, we are insulating ourselves from the problem of shale gas development while at the same time meeting our local fuel demand ourselves from the problem of shale gas development while at the same time meeting our local fuel demand and avoiding fuel importation, the waste of funds it is causing us as well as the corruption that it has entrenched in the system. Local refining is the

way out for Nigeria," Onyeanu told SweetcrudeReports. Indeed, the market outlook for oil refining in Nigeria is bright. With a population of over 150 million people, local fuel consumption is estimated

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2013 July, SweetcrudeReports

Barge transporting equipment offshore

CONTINUED FROM PAGE 5 at over 40 million litres per day. Analysts say the large population and huge consumption strongly support local refining. At present, Nigeria boasts four refineries in Warri, Kaduna and Port Harcourt with a combined capacity to refine 445,000 barrels of oil per day. The snag though is that the refineries, aged between 25 and 48 years, have become obsolete and have over the years functioned abysmally, making it impossible to meet local fuel demand. With Nigeria importing almost the entire volume of its 40 million litres daily fuel requirement, analysts believe that establishment of more refineries would save the day. Rather than spend scare foreign exchange in funding fuel importation, the establishment of local refineries would ensure Nigeria is self sufficient in fuel, in addition to growing the national economy and the GDP and creating employment, Onyeanu said. M r. B a b a t u n d e O g u n , president, Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, would want the government to grant incentives that would encourage the establishment of private refineries in the country. According to him, the problem of oil importation, orchestrated by the lack of local refining capacity, has

Shale gas and Nigeriaâ&#x20AC;&#x2122;s ill-preparedness increased the hardship of Nigerians. The government had thought along the line of encouraging the establishment of local refineries as far back as 2002 when it licensed 18 private companies to build and operate refineries. Sadly, 11 years after, none of the refineries is yet come on stream. The industry regulator, the Department of Petroleum Resources, DPR, in its latest update on the private refineries, affirmed that none of the plants was anywhere near completion. "The problem is lack of policy clarity on the part of government. There is no clear direction as to which way we are going. The other issue is fiscal - difficulty in securing financing and pricing in a regulated regime," an investor in one of the licensed private refineries who craved a n o n y m i t y t o l d SweetcrudeReports. Still, industry observers believe that the emergence of private refineries would help Nigeria absorb the entire volume of its daily oil output, thereby avoiding the shale gas challenge. But, besides the local scene,

Market exists across Africa. Ghana, Angola and other countries may be producing oil, but they themselves are still net importer of petroleum products.

markets equally exist in the West African sub-region and across Africa, which Nigerian refineries could tap into. "Market exists across Africa. Ghana, Angola and other countries may be producing oil, but they themselves are still net importer of petroleum products. This means that the market is there," Onyeanu added. Like Ogun, he advised the Federal Government to encourage investors in local refineries by providing incentives and assisting them in overcoming their problem in securing financing for their projects. Obama flaunts US oil independence

Earlier in the year, an obviously elated US President Barack Obama was empathic in his declaration that United States "is now ready to take control of its energy future". "After years of talking about it, we are finally poised to control our own energy future. We produce more oil at home than we have in 15 years. We have doubled the distance our cars will go on a gallon of gas, and the amount of renewable energy we generate from sources like wind and solar. We produce more natural gas than ever before," he told the US Congress during his state of the union presentation in February. The US president was to reaffirm America's

energy independence during his recent visit to Africa. While in South Africa Obama declared, "we don't need Africa's oil, what we need is to help Africa generate enough energy for its people". Obama's optimism draws mainly from the country's latest success in the exploitation of shale gas, the new energy source that has suddenly captured the attention of the world. The US has rapidly ramped up its oil production recently owing to deployment of technology to extract oil from shale rock and is well on its way to replace Saudi Arabia as the biggest oil producer on the planet within the next four years. Canada, Australia as well as European and Asian countries that are big oil consumers are also engrossed in the quest for shale gas and have in recent time redoubled efforts at exploring and exploiting their reserves. The UK calculates that the shale gas development will create tens of thousands of jobs, reduce imports, generate significant tax revenue and support manufacturing.

Oil

2013 July, SweetcrudeReports

SPDC JV debunks false claims on TNP oil spill and fire

Oil spill site

YEMIE ADEOYE

h e S h e l l Petroleum Development Company of Nigeria Ltd, SPDC operated Joint Venture has restated its determination to continue to operate safely and in an environmentally friendly manner, even as it decried the sabotage and crude oil theft that led to the recent fire and explosion on the 28" Trans Niger Pipeline, TNP. A joint investigation team comprising regulators, communities, independent

observers and SPDC found that this incident occurred as a result of unknown persons installing a valve to steal crude oil from the line. SPDC has repaired the valve point and removed six other crude oil theft connections in its continuing efforts to maintain the integrity of the line. Also, the 24" TNP, which was shut down in a precautionary response to the fire on the 28"TNP has been reopened for production. In a statement issued by the Company, the Managing Di re ct o r o f SP DC a nd Country Chair Shell

SPDC has also dismissed suggestions that the TNP is not safe to operate. The line is operated in line with the company’s Pipeline Integrity Management System, ensuring regular inspection and maintenance Companies in Nigeria, Mutiu Sunmonu said: “Suggestions that we reacted slowly to the fire and spill are false.

Afren increases stake in Nigerian partner CONTINUED FROM PAGE 1 Afren is paying an average of $3.10 a share to extend its interest from 54 per cent to 78 per cent in FHN for a total of $105m. It has also struck a deal that allows it to acquire a further 12.5 per cent in FHN at $3.32 a share in 2015. Directors and executives holding stock directly in the Nigerian vehicle have

undertaken to use the net proceeds of the sale, that will gross $30m, to acquire Afren shares and hold them for a minimum of two years. The sales price of $2.47 a share, although less than that offered on Friday to extend its stake, is the same level paid by Afren when it agreed to buy a further tranche of shares in March.

Afren helped establish FHN in 2009 as an local oil and gas company that was majority Nigerian owned and thus more likely to be successful in bidding to operate licences put up for sale by foreign operators. In December 2011, FHN acquired a 45 per cent interest in the OML 26 portfolio of assets in Nigeria from Royal Dutch Shell, Total of France

At the earliest opportunity, we quickly mobilised teams to respond to a crude theft spill on the 28" TNP on June 10 and the explosion and fire on June 19. We conducted an assessment of the risks and decided, with the support of the JTF to enforce a restriction of access to the site for safety reasons. Our response and the actions we took at Bodo West were in the best interest of lives and the environment.” SPDC has also dismissed suggestions that the TNP is not safe to operate. The line is operated in line with the

company’s Pipeline Integrity Management System (PIMS), ensuring regular inspection and maintenance. The dominant cause of failures on the TNP has been third party damage resulting from sabotage (hacksaw cuts, drilled holes, etc) and illegal crude theft. In the past three years, a total of 25 leaks have been recorded on the facility – 23 of which were due to sabotage and two operational pinhole leaks. Integrity assessments including Long Range Ultrasonic Test (LRUT) surveys, Cathodic Protection (CP) surveys, and chemical injection have been periodically performed on the pipelines. Also, SPDC has always made use of the opportunity presented during sabotage/crude theft point leak repairs to carry out onthe-spot coating and internal checks to confirm the integrity of the pipeline and coating. M r. S u n m o n u s a i d : “Shutting down the pipeline as has been suggested is not CONTINUES ON PAGE 8

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2013 July, SweetcrudeReports

Oil spill in the Niger Delta

SPDC JV debunks claims on TNP oil spill CONTINUED FROM PAGE 7

the answer. Our ability and competence to safely operate the pipeline has never been in doubt. The only way to ensure the TNP operates optimally without being shutdown regularly for repairs is to stop the thriving crude theft activities on both the 24” and 28" streams. All the data from the interventions and assessments in the pipeline integrity assessment process currently confirms that the pipelines are healthy and fit for service. Anyone who wants to see the information can log on to our spills website www.shellnigeria.com/spillsM r. Sunmonu referred to the reported arrest of some employees of an SPDC service contractor on suspicion of crude theft on the TNP, and s a i d : “ We c o n t i n u e t o cooperate with the JTF in the investigations. We have confidence that the arrested persons shall be treated in line

with the principle of presumption of innocence and hope for a speedy and transparent dispensation of justice He added: “As we have stated previously, crude theft has severe consequences lasting far beyond our lifetime. I have a personal stake in this tragedy having spent nearly all my adult and working life in the Niger Delta. The trend of crude theft will result in long-lasting damage to the wellbeing of present and future generations. All stakeholders who are genuinely interested in seeing this problem curtailed should join hands and stop this crime against the people and the environment of the Niger Delta.”

hell stated further that t h e T N P h a d previously been targeted by crude thieves and shut down several times to take out crude theft points. To ensure

The containment equipment on site was destroyed in the explosion/fire. To prematurely extinguish the fire without functioning containment equipment would have resulted in increased environmental damage that the facility continued to meet operating standards, SPDC deployed a team to Bodo West on May 22, 2013 to remove and repair crude oil theft connections on both the 24 and 28-inch sections of the TNP. “The repair team’s presence and mandate to remove crude theft points were made known to the community which granted them access. No sectional replacement work was underway. One operations support barge, one environmental barge and two tug boats were the only authorised vessels at the B o d o We s t w o r k s i t e .

Environmental barges are typically used to store and transport recovered oil. U n f o r t u n a t e l y, c r u d e thieves continued to operate at night even as the repair team worked to remove illegal connections during the day, such that, on the day of the incident on June 19, two unauthorised Cotonou boats were reportedly present at the time of the initial explosion and fire.

he established operations routine at any repair site comprises a

team of SPDC staff, contractors and regulators who only work during daylight hours and leave the site at the end of each day. This means that no SPDC authorised people could have been on the ground at the time of the incident. Having shutdown and isolated the pipeline, but with oil continuing to flow from the pipeline under gravity to the low point on the TNP, the only practicable option in the circumstance was to allow the fire burn out naturally. The containment equipment onsite was destroyed in the e x p l o s i o n / f i r e . To prematurely extinguish the fire without functioning containment equipment would have resulted in increased environmental damage. We continued to monitor the fire while also mobilising replacement oil spill containment and response equipment to site.

Oil

2013 July, SweetcrudeReports

EFCC arraigns man over Sao-Tome refinery job scam

Oil refinery

he Economic and Financial C r i m e s Commission, EFCC, has arraigned one Mr. Agada Ayibakuro and Global Oil and Gas Limited before Justice S.A Aliyu of the Federal High Court, Port Harcourt on a 19count criminal charge bordering on obtaining money by false pretence. When the charge was read to the accused he pleaded not guilty. The accused and others at large sometime in 2010 allegedly fleeced some jobless Nigerians of N2, 3 8 7 ,0 0 0 .0 0 (Two Million Three Hundred and Eighty Seven Thousand Naira) under the pretext of helping them secure employment at a refinery project in Sao Tome and Principe. According to court

documents obtained by our correspondent, one of the counts read: “That you Agada Ayibakuro Ayisco, Global and Gas Limited and others now at large between December 2007 and October 2010 at Port Harcourt within the jurisdiction of this Honourable Court did conspire among yourselves to commit felony to wit: obtain money by false pretence using Petroben Oil and Gas (W.A) Limited and Ayisco Global Oil Limited and thereby committed an offence contrary to section 8[a] of the Advance Fee Fraud and Other Fraud Related Offences Act 2006 and punishable under section 1[3] of the same Act. Justice Aliyu however granted the accused bail in the sum of N1million and a surety in like sum. The surety, who must not be less

that a grade level 15 officer in the River State civil service, will also present an affidavit of means. The case was adjourned to November 11, 2013 for trial.

Mexico’s oil output dips

il production in Mexico slid to its lowest level in about two years in May, while exports were their weakest in more than two decades, according to official data. Crude output at state oil monopoly Pemex, which President Enrique Pena Nieto has pledged to reform in the coming months, fell to 2.51 million barrels per day in May, its lowest level since September 2011, Reuters reported citing company data. Oil exports dropped to 1.03 million bpd, the lowest level of crude shipments since the national energy information system began publishing monthly export figures in 1990. Pena Nieto plans to boost production at Pemex by attracting private investment to the

company, though he faces opposition from traditionalists who have accused him of planning to sell out the industry to foreign oil majors. Pemex has been a source of Mexican pride since the government nationalised the industry in 1938, and reform of Pemex has long been fraught with difficulties. The government aims to present its Pemex plan by September and officials say it is likely to contain a blueprint to allow profit-sharing between Mexico and private companies in exchange for the latter taking on exploration and production risks, Reuters reported. Mexico, the world’s seventh largest oil producer, has seen output drop steadily from a peak of 3.4 million bpd in 2004.

Oil

2013 July, SweetcrudeReports

NIGERIA CONTENT INITIATIVE Dr. Ibilola Amao

DPR: A human resources paradox

he Ministry of Petroleum Resources (MPR) in Nigeria has

recently played out a most remarkable HR paradox. I would

like to recommend that the Minister consults with HR

professionals who can correct the anomalies in the process and

procedure involved in the recent removal of the former Director of the

DPR and puts an end to the errors of the 1975 “immediate effect

retirement fiasco”. This particular unprofessional action smirks of

instability and inconsistencies in the MPR and Nigeria’s public sector. A

fundamental Human Resource procedure for disengagement has

obviously been jettisoned and this is at variance with due process. The

removal of the Director, DPR in a most unceremonious manner leaves a

lot to be desired. The inability of the Ministry of Petroleum Resources to

follow due process in human resources management can create an

Achilles heel for our hydrocarbon industry because highly skilled,

knowledgeable human resource of integrity do not come cheap and

would tend to shun positions that are considered rather unstable. If the

Minister would bring to bear Shell’s professionalism with the best HR

systems, processes and procedures, the result of this action would be

that the best brains with independent minds and superior ideas that can

transform the nation would be willing to serve the nation.

My first personal meeting with Mr. Osten Olorunsola in his Shell

Nigeria Exploration and Production Company, SNEPCO, office exposed

me to the fact that he is very passionate about developing young

professionals and committed to being an excellent mentor and coach. It

pleased me to know that he had a heart for developing the nation also. I

Oil pipelines

believed then that with him in a leadership position there will be hope

for any graduate who looked forward to a future that was hinged on

PPMC restreams Atlas Cove pipeline after fire SAM IKEITUONYE

andals struck on the Nigerian National Petroleum Corporation, NNPC, pipeline in Ilado community, near Atlas Cove, Lagos, recently, causing a major fire and leading to panic in that part of Lagos. But days after, the Pipelines and Products Marketing Company, PPMC, a subsidiary of NNPC, said it has repaired and re-streamed the vandalised pipeline. Mr Nasir Imodagbe, Manager, Media Relations and External Affairs, made this known in an interview in Abuja. Specifically, vandals had on Wednesday, June 26, ruptured the NNPC

pipeline at the Akinbo Jetty at Atlas Cove and siphoned petroleum products. The timely intervention of NNPC/PPMC engineers and security operatives saved the day and repair work had commenced immediately after the fire was put out. “Repair-works commenced on the pipeline immediately the fire was put out. I can tell you that the pipeline has been repaired and restreamed after it was temporarily shut down for repairs. “Pipeline vandalism and oil theft account for loss of billions of dollars annually to the nation and the Federal Government has been exploring various ways to curtail the menace,” Imodagbe said. He called on Lagos

residents to avoid panic buying as the PPMC was working with all stakeholders to ensure uninterrupted fuel supply to Lagos and the entire country. The PPMC spokesman called on host communities and other stakeholders to join the NNPC/PPMC to curb pipeline vandalism in the country, adding that the PPMC was already exploring the use of better technology and security arrangements to safeguard the pipelines.

meritocratic service in the Nigerian hydrocarbon industry. Almost 250

DPR new-hire’s benefitted from his leadership at the Department and at

the recently concluded induction programme for new-hire, which I was involved in personally and corporately, he convinced me that beyond the

job he meant well for the Department, regulation of Nigeria’s petroleum

industry and the professional competence of regulator’s whom he viewed

as the much needed change-agents that Nigeria requires.

Mr. Olorunsola’s professional pedigree is not only admirable but

commendable. From his CV which was presented at the new-hire

induction, his career commenced in ENI Nigeria, Italy and France in

1980 where he served until 1990 when he joined Shell until 2011. His

meritorious career covers various world-class assignments where his

knacks for strategic thinking, planning and execution enabled him

create and add value within and outside Shell. Amongst other

achievements, his career spans serving as: Business Interface Manager,

Russia, Shell Regional Reserves Value Manager (RRVM) Africa – this

position covered accountability for Shell International Oil and Gas

reserves across Africa, Technology Manager Rijswijk, with a gap to act as

a Strategic Business Adviser (SBA) to the Federal Government of

Nigeria. He identified the need for professionals with international and

overseas experience to regulate Nigeria’s hydrocarbon industry and

being a patriotic Nigerian, accepted to serve his nation in the capacity of

Director, DPR. He was brave enough to exit his world-class career path

in Shell to serve for less than two years as Director. Nigeria and the DPR

have indeed lost a true professional as it has in the past other senior

executives under the MPR who were removed unceremoniously. Some

examples include:

Late Alhaji Shehu Ladan (NNPC, GMD), Dr.

Mohammed Sanusi Barkindo (NNPC, GMD), Mr. Tony Chukwueke

(DPR), Mr. Andrew Obaje (DPR) etc. If this HR anomaly is not corrected

it is very likely that Mr. Osahon, the newly appointed Director DPR

would be dismissed without due process being followed and the lesson

should be that the MPR must constrain and restrain itself from

politicising positions that require professionals and professionalism.

Nigeria is ranked 139th out of 176 countries in Transparency

International’s 2012 Corruption Perceptions Index. The abrupt

replacement of a key resource at a time when the world awaits a credible

bid round and the passage of the long awaited PIB beg to have questions

answered on our commitment to due process, transparency and

integrity. Nations that have long-term plans to actualise Vision 2020 are

Pipeline fire

not only optimising talent, but are seeking for and attracting talent.

Oil

2013 July, SweetcrudeReports

Good & bad news for Total’s Egina project

1 1

FMC scoops Egina subsea prize

Oil field

CHUKS ISWU

or Total’s Egina project, it is a case of the good and bad news. The good news is that Total has commenced the development of the $15 billion (N2.4 trillion) deepwater project, off Nigeria, after years of delay caused by the Nigerian National Petroleum Corporation, NNPC's, dragging of feet on the project. And the bad news: The project has now suffered a two year deferment in its take off date on account of the same issue of NNPC's initial reluctance in granting it approval. Originally billed to begin production in 2015, the latest arrangement following the recent commencement of development work is for the project to come on stream in 2017. Total said first oil from the field, which is part of the Oil Mining Lease, OML 130, is expected at the end of 2017, with output reaching 200,000 barrels of oil a day. But, the

project would only be started after the company obtained the necessary approvals from authorities in the oil and gas sector to award the main contracts, Total's chief executive officer, Christophe

store 2.3 million barrels," thecompany said, adding: "Locally worked hours will reach about 75 per cent for Egina as part of a plan to boost local content of Nigerian projects."

The contract covers the supply of subsea trees and wellheads, manifolds, installation tooling, flowline connection systems and associated control systems, with deliveries due to start in 2015 de Margerie, said. The French oil giant had earmarked the Egina project as part of its plan to boost its production as well as that of Nigeria.The company is now looking at making fresh large oil and gas discoveries in a bid to raise production. "The Egina project calls for 44 wells connected to a 330 meter-long floating production, storage and offloading vessel which can

Total would be using a floating production, storage and offloading, FPSO, vessel to develop the deep-water field, located in a water depth of 1700 metres, with the $3 billion contract for construction of the vessel already awarded early last month to South Korea’s Samsung Heavy Industries. The French firm is operator of Egina with a 24 per cent interest, other partners being the Nigerian National Petroleum Corporation, South Atlantic Petroleum of Nigeria, Cnooc Limited and Petroleo Brasilero SA.

s part of the development work, FMC Te c h n o l o g i e s w o u l d b e executing a $1.2 billion subsea equipment order. The contract covers the supply of subsea trees and wellheads, manifolds, installation tooling, flowline connection systems and associated control systems, with deliveries due to start in 2015. FMC’s senior vice president, subsea technologies, Tore Halvorsen said Egina will be "the largest subsea project to date in West Africa". The contractor has expanded its facilities in Lagos and Onne to handle delivery of the equipment as part of its strategy to meet Nigerian local content requirements. Saipem takes a bite of the cake too Italian contractor, Saipem, also secured a $3 billion contract to build and install subsea flowlines as well as other facilities for the Egina field. It followed the earlier award by the French operator of the fabrication contract for the field’s floating production, storage and offloading vessel to Samsung Heavy Industries. The Italian company will carry out engineering, procurement, fabrication, installation and precommissioning of 52 kilometres of oil production and water injection flowlines under the deal. It will also deliver 12 flexible jumpers, 20 kilometres of export pipelines and 80 kilometres of umbilicals, as well as mooring and offloading systems, with installation work to be carried in 2016 and 2017. Most of the fabrication work will be carried out at the Saipem Rumoulumeni yard in Port Harcourt, Rivers State, in line with Nigeria’s local content requirements.

Netherlands supports Tanzania Biogas Project with $21m

he Tanzania Domestic Biogas Programme, TDBP, is expected to spend $21 million on setting up the infrastructure that will see around 50 enterprises being created through The Netherlands-supported project. Basically biogas is a product of the natural decomposition of any organic substance of animal or plant origin due to the activity of anaerobic (functioning in a nonoxygen environment) bacteria. Major sources of methane are all animal excrements, waste landfills, and any other organic material which is left untreated. The TDBP said in a statement last week, under the programme that started in 2009 and is now extended to 2015, about 6,000 biogas machines have been constructed.

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2013 July, SweetcrudeReports

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Petroleum engineers gather in Lagos, to brainstorm on crude oil theft

SAM IKEOTUONYE

etroleum engineers working in the Nigerian oil and gas sector will gather in Lagos in the last week of this month with a view to fashioning out a lasting solution to the problem of crude theft. The Society of Petroleum Engineers, SPE, believes increasing crude oil theft, depleting reserves and dwindling revenues ought to be a major source for concern for all stakeholders in the Nigerian oil and gas industry. Mr Osayande Igiehon, the Council Chairman of SPE Nigeria, stated this in an interview in Lagos. Nigeria, being a monoeconomy, relied heavily on crude oil, which accounted for 95 per cent of the c o u n t r y ’s e a r n i n g s , a situation, Igiehon said, had made it imperative that Nigerians should be concerned about crude oil theft and its effects. He said that to this end, experts would gather at this year ’s exploration conference, organised by the SPE in Lagos, to deliberate on how to proffer pragmatic solutions to the problems. The conference tagged

Nigeria, being a mono-economy, relied heavily on crude oil, which accounted for 95 per cent of the country’s earnings, a situation, Igiehon said, had made it imperative that Nigerians should be concerned about crude oil theft and its effects " N i g e r i a A n n u a l International Conference and Exhibition, NAICE" would hold between July 30 and August 1. Igiehon stated that the theme of the conference - "To Grow Africa’s Oil and Gas Production: Required Policy, Funding, Technology, Techniques and Capabilities" - was carefully chosen in view of the depleting oil reserves in the region. He said the conference aimed at providing a robust platform for governments, industry and the academia to take a position that would be crucial to efforts to stimulate Africa’s economic growth and meet the world’s growing energy needs. He said: "As exploration of crude oil never ceases, there is need for further discoveries

of more reserves to replenish those already extracted from oil wells. "From inception of oil discovery in Nigeria, you would have observed that after much exploration from

a well, it is usually abandoned. Attention is given to other oil wells whenever one well becomes less economical to operate. "So, the challenge of inventing new technologies to aid new crude oil discoveries and reduce costs of operation would be discussed. Besides, the incessant crude oil theft in the region and possible remedies would also be discussed because of the alarming spate of oil theft in the region". However, Igiehon noted that the participation of Nigerians in the oil and gas industry had increased since the enforcement of the

Nigeria Content Act began. "And further possibilities of giving more opportunities to indigenous operators would also be discussed at the conference," he said. Igiehon said that the marginal field best practices workshop will feature seasoned experts who had successfully put marginal fields on production, adding that they were expected to share their experiences and challenges. He said that at the end of the conference, the participants, through the SPE Nigeria Council, would issue a communiqué to regulators on the outcome of their deliberations.

In Canada, pipeline operators to pay $1bn for potential spills

anada’s Conservative Federal Government plans a new legislation that would require existing and new pipeline companies to have at least $1 billion financial capability on hand to cover any spills on Canadian soil. Natural Resources Minister Joe Oliver made the announcement in Vancouver, a week after he announced government would raise the absolute liability for energy companies operating offshore Atlantic Canada and Arctic Canada to C$1billion to align accountability with international standards. He also announced new safety rules for pipelines and new financial penalties which would soon come into force for individuals and

companies that violate environmental laws. Oliver added that government planned to enshrine the currently implicit "polluter pays" principle, in law. "The measures announced today strengthen Canada’s already strong pipeline system even further. Our vast resource wealth is being developed responsibly, supporting Canada’s growth and generating revenue for critical social programmes," he said. Other measures announced by the Minister included requiring companies to appoint an accountable senior officer, whose duty would be to ensure that management systems and programmes were compliant, and to ensure companies’ emergency and environmental plans were transparent and easily available to the public.

Focus

2013 July, SweetcrudeReports

Only Government Government Only can stop stop pipeline pipeline can vandalism vandalism —Tompolo —Tompolo

YEMIE ADEOYE

igh Chief Government Ekpemupolo, popularly known as Tompolo, means different things to different people. To some, he is a militant leader who should be feared and despised. To others, he is a no-nonsense freedom fighter who is ready to lay down his life for a cause he strongly believes in. To others still, he is a philanthropist of no mean measure.

Following the rise in pipeline vandalism and illegal oil activities which have drastically affected Nigeria’s crude oil production prompting the Anglo-Dutch Shell to shut in some 150,000 barrels of daily production, it became highly imperative to go in search of the enigmatic gentle man whose name conjures fear in several parts of the country. In this exclusive interview with SweetcrudeReports in Warri, the ex-agitator who chose to speak through his spokesman and Executive Secretary of the Tompolo Foundation, Mr. Paul Bebenimibo, opened up like never before on a number of issues cutting across various spheres. He spoke extensively on the controversial PIB, current state of oil production, illegal oil activities and what should be done to checkmate it, the Tompolo Foundation, amnesty, and the NNPC floating mega stations, amongst others.

Excerpts: How is life after the struggle? What activities has Tompolo been involved in since accepting t h e f e d e r a l g o v e r n m e n t ’s amnesty programme? First, let me thank you sincerely for the opportunity to reach out once again. High Chief Government Ekpemupolo or Tompolo as he is fondly called means different things to different people in this Country and has also been greatly misunderstood. Basically, the reason for the initial arms struggle on behalf of

the people of the Niger-Delta is due to the terrible conditions of living in the Niger-Delta despite the fact that the area produces the wealth of the Nation. In 1958 there was a commission which was mandated to look into the living condition of the minorities in the Country and it came out with a report that there is need for a major development of the terrain due to the difficulty of the region they have found themselves which is the NigerDelta, and after the discovery of Oloibiri and subsequent spread throughout the Niger-Delta the

area was highly exploited by Multinationals and until I and other progressives went into the struggle to agitate for a better living for the people it could be ascertained that the livelihood of the people had been totally destroyed and this has been reportedly referred to as a criminal neglect and this is why we went into the struggle. So after the struggle which has since ended what new things have been happening? After the agitation he has remained in the struggle for a better living for the people of the Niger-Delta largely by

advocating and proposing good policies for the government. An example is the Oil facilities surveillance which we proposed, because we made it clear to the President that the only way to curb illegal oil activities which has bedeviled the country is by involving the locals in the monitoring of these facilities. The Host communities needed to provide the surveillance of these facilities and it was tried and the result was impressive. So he is still very much in the agitation for a better living for our people even with very little time for his own immediate family. So is he a contented man now? Is he satisfied with the situation of the region since the arms struggle ended? The struggle has not ended, just that the modus operandi has changed. Now we are into peaceful advocacy for a better standard of living for the people. The promise the government has made has still not been fulfilled. The declaration of the Presidential amnesty was just a vehicle to carry the agitation to its destination. Amnesty on its

own is not the end. It’s just a means to an end. It was just a platform that was created for a roundtable discussion for the issues to be resolved amicably. Issues of participation in governance, having our people in the various committees that determines what comes to our region so they can be better guided, giving the people of the Niger-Delta a stake in the oil sector as produced by their communities, and this is the reason why I said earlier that the amnesty is just a means to an end, because the people being trained by the Amnesty program need to be properly engaged afterwards by the Oil companies, as most of them received training around oil and gas operations and activities and they must be employed as this is the only way to lasting peace in the region and Nigeria by extension. You talked about a surveillance program for Oil facilities in the Niger-Delta, there has been a very high increase in pipeline vandalism and oil theft has been on an alarming high, and even the Hon. Minister of petroleum resources also decried this act recently, as a stakeholder in the

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CONTINUED FROM PAGE 13

Sadly enough what government is currently losing is far higher than the contract sum for the surveillance contract that is of course a cause for worry. A case of losing more than you would ever invest in protecting those loses. The contract on the other hand also gainfully provides employment for the thousands of restless idle hands in the region.

nation’s oil and gas sector I want to have your views on this development. What is the reason behind it and what do you propose as a solution? It is very simple! What could be done to nip the act of illegal oil activities in the bud... Do you agree with the federal government that the situation is getting worse? Yes I do! I agree with them, for the simple fact that it wasn’t as bad as this for the late part of 2010 to 2012 because then the surveillance activities on Oil facilities was intense as it was being carried out by those who knows and understands the terrain and this was as a result of the Presidential contract to safeguard Oil facilities in the Niger-Delta, and this contract was awarded in three states, Bayelsa, Delta and Rivers states. I can speak effectively for Delta state, and I do state clearly that the surveillance program was much more than a success in that state, and the figures and facts are there to show. Sadly enough the Government for reasons strange and unknown has refused to renew that seemingly important contract. When this contract was awarded in 2011 it was just awarded as a one year pilot project and with the success that was recorded in states like Delta we expected the Government to do all it could to ensure that it continued. Some of the exagitators involved in the amnesty program, but who weren’t lucky enough to get placement for training were all employed to carry out this job, and during the period when this contract was on they were the ones who were engaged to do the job and they were being adequately paid. But now that the contract has not been renewed, you cannot guarantee that they wouldn’t go back to illegal oil activities as a means of survival, that is the simplest and singular reason why there is an increase in illegal oil activities and this might even continue to grow as there is currently no form of surveillance on these facilities especially the ones crisscrossing the difficult terrains and swampy regions. To answer your question, the only thing that the government can do right now if they are truly bothered about the rise in illegal oil activities is to renew these surveillance jobs and even expand it to areas that were not initially captured. If this is done I can assure you there would be

Tompolo

Only Government can stop pipeline vandalism —Tompolo serious drop in illegal oil activities and revenue base would rise like magic, it’s however up to the federal government. Do you suggest same therapy for an area like Lagos where the most strategic pipeline in the Country, system 2b has being consistently vandalized with lives lost in the process? Yes! The same therapy should apply if the government really wants to nip this in the bud. If you reside in an area and a stranger is coming into that community you would know. It’s simply community policing! So when you hand over the Lagos axis and other areas to those who resides there you would see an immediate change and nothing would happen to those lines anymore. Hence, it should be noted that nothing would work better than community policing if we must curb illegal oil activities and pipeline vandalism in Nigeria. So the Nigerian Police or Navy can’t tackle this, and we need to form another set of police for this?

Sadly enough what government is currently losing is far higher than the contract sum for the surveillance contract that is of course a cause for worry Yes! They can’t tackle it! If they can it would have been tackled rather than increasing. And this is simply because they do not understand those terrains better than the residents, and the community people would not even cooperate with them because they are afraid to even give them information, this is also because there is a way that the police or other uniformed agencies would treat information and it is not always satisfactory to the people, so they won’t even give you information. So the best way is simply community policing. You said earlier that when this contract was awarded the illegal

oil activities went down. How certain are we about this? What have we to show that this was really the situation? Do we have facts and figures to support this? Well, all I can tell you is that those facts are with government and its relevant agencies. The GMD of NNPC has confirmed at different forum that production actually went up and illegal activities reduced around that period. It was at the end of the one year contract that things broke down to this level to the extent that the federal government summoned a meeting and was discussing the declining state of petroleum income.

How does this program work? Please give us an idea of how it was operated either in Delta, Bayesla or Rivers states? The one year contract that ended in 2012 engaged 5000 persons in Delta state alone. I’m talking 5000 youths cutting across all ethnic backgrounds. They were the ones doing the job and they didn’t allow any external influence or force to come into the region to wreck any such havoc. In Bayelsa 3000 youths were engaged and in Rivers state 4000 was engaged. As I’m talking to you that contract took care by way of gainful employment a minimum of 12,000 youths across the Niger Delta, and all these people are currently jobless. So do you still wonder why there is an increase in illegal activities? And if this be renewed I urge the federal government to expand it beyond the initial 3 states which participated in the pilot program. The government should not also capitalize on whatever weaknesses there are of the program, rather it should look at ways of better modifying it to meet whatever standards the government desires. So the solution can never lie in terminating the contract rather they should find out why things are not working as desired in some states. So what is one cardinal goal that the arms struggle has achieved? One major achievement of the struggle is that it has enlightened the ruling class that truly this region is in dire need of development in terms of jobs, economic and social empowerment etc. however the aspect that is left is for the government to begin to implement those policies that has been agreed upon like the Petroleum Industry Bill currently before the National Assembly these are the ways to further calm nerves in the NigerDelta. Now that you have mention the PIB I’ll like us to dwell on it for a few minutes. The bill is said to be the single most important document currently before the National Assembly. It is believed

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Only Government can stop pipeline vandalism CONTINUED FROM PAGE 14 however that some of the reasons for your initial agitation are addressed in the PIB. Aside from this, Northern Senators have also being reported to have kicked against some sections of the bill which calls for more funding for host communities in the Niger-Delta. What is your reaction as a stakeholder whose community would be affected by the outcome of this bill? My view on that is very simple; the problem with the Northern Senators is that they don’t understand that Oil could be discovered in any part of the Country. Recently we heard of Oil prospects in Kwara, Kogi and even in Sokoto, so basically this law is for the entire Country and not just the Niger-Delta as it could be the turn of any part of this Country to produce Oil tomorrow hence such an important document shouldn’t be trivialized by ethnic sentiments and should be given a speedy attention, it’s going to be a law for the entire Country when passed. So if you’re against host communities benefitting from the oil proceeds emanating from their region today, by the time a place like Sokoto discovers Oil you will not be able to convince the other part of the Country to support your cause. So they should support the bill now as that would enable us avoid so many issues that may arise again when oil is discovered elsewhere, because when that happens it would only require a mere review to include the new areas that are going to produce oil. One of the proposals of the bill which is in favour of the host communities states that an additional 10 percent of oil proceeds should go to the host communities, but after the 13 percent derivation to oil producing areas have failed to yield the desired result do you

think this is a step in right direction or a means of further empowering corrupt Governors and Politicians? That part of the PIB which currently states that 10 percent of oil proceeds should be given to Communities is a process to correct the abnormalities in the dispensation of the 13 percent. If we say we have not benefited anything from the 13 percent derivation, then we must find a means to also correct the reason why the benefit doesn’t trickle down to the people. The beauty of what is contained in the PIB as against the 13 percent derivation is that this time around the proceeds would go to the host communities directly. It should however be noted that the so called 10 percent is not even enough, because when

Tompolo Foundation. We are aware that amongst all other repentant ex-agitators you are the only one running such a program what is the reason behind this? Well as you may be aware Tompolo is no politician and he doesn’t intend to go into politics. Having said that I would simply respond to your question by saying that the decision to establish the Foundation was borne out of my desire to continue to impact on the lives

If we say we have not benefited anything from the 13 per cent derivation, then we must find a means to also correct the reason why the benefit doesn’t trickle down to the people. you talk of development it would be discovered that it requires almost 10 times the amount you need to construct a road in the hinterland to construct that same road in the coastal areas. Hence like I said earlier, it’s a good thing that the proposal should be geared towards the communities for the first time rather than state governments. Thus, I want to urge the National Assembly to look beyond ethnicity or any other issue and pass the PIB without further delay as it would become a law for the entire Country. Tell us a little about the

and welfare of the people of the Niger-Delta. It should however be noted that giving back to the people has been the whole essence of Tompolo as that is the only way I derive happiness and that was why I was forced to take up arms against the system that have left our people in abject poverty. Sometimes around last year we however decided to make it formal and broaden the reach as we came to realize that the problems of the Niger-Delta goes far beyond one or two communities. Also of note is the fact that we don’t have as much as is required

to cater for the basic needs of those rural people we hope to help, so going formal will enable various donors both locally and internationally to join our cause and see the little they can do to assist through our foundation. In just six months of our existence we have done a number of things to help alleviate the stress of the people. Can you share some of these with us? Yes! The Foundation is basically focused on Health and Education, and we concentrate our efforts on the coastal areas because these are very difficult terrains that the government finds very difficult to access, hence any government project you see are largely abandoned projects so this was what informed our decision. We have in that short period distributed learning and teaching materials, as well as materials for co-curricular activities worth over N50 million to both primary and secondary schools in the Coastal areas, and our recent evaluation and assessment indicated that those materials where really helpful to both the teachers and students in those areas. Also in April the Foundation took over the renovation of a Hospital that has been abandoned for about three years by the Delta State Government through DESOPADEC. It was fully renovated and brought to modern medical standards and the Foundation engaged the services of qualified experienced doctors and nurses and equipped the place in order for them to carry out their duties

effectively. As we speak we have been able to carry out both major, minor and intermediate surgical operations. How equipped is well equipped according to you? It is a cottage Hospital, and we have ensured that all basic and necessary equipments to deal with common cases in the riverine areas are provided as well as modern surgical equipments. In a single month our overheads run into about ten million naira and this includes staff salaries and daily operational costs. The treatment and drugs are all free of charge and nobody pays a dime in this Hospital. The coastal areas, you must understand is an extremely difficult terrain hence it is not very easy for any government Agency to want to site a project there because of the costs and other issues. After the arms struggle there has being Amnesty and rehabilitation, what is the current state of the ex-agitators and what effect have they had on the economy? Well the Amnesty program is simply a means to an end like I’ve always said, and I would want to commend the Government for sustaining that means. The means has rehabilitated the ex-agitators and is trying to reintegrate them back into the normal society and I think that is very good. However, while the training and rehabilitation is highly appreciated it’s highly imperative that the government devices a means for such people to be employed.

2013 July, SweetcrudeReports

Gas

2013 July, SweetcrudReports

Brass LNG makes progress, resolves funding challenges —Gauis-Obaseki

he multi-billion dollar Brass Liquefied Natural Gas, LNG, project in Brass Island of Bayelsa State has made progress, Dr. Jackson Gauis-Obaseki, chairman of the Brass LNG Limited, has said. According to GaiusObaseki, a former group managing director of the Nigerian National Petroleum Corporation, NNPC, the company has been able to resolve funding structure challenges concerning the project, paving the way for Final Investment Decision, FID, on the project to be taken the shareholders soon. This formed part of the major decisions reached by the shaeholders at a recent meeting in London. Gauis-Obaseki disclosed this in Lagos at a send forth party organised for retiring M r. J o a o D e O l i v e i r a , General Manager in charge of Brass Facilities at US firm, ConocoPhillips, who is also t h e m o s t s e n i o r representative of the company in the project. “You have delivered on the Engineering Procurement Contract (EPC). The confidence reposed in you has been justified. I assure you that the project has reached a

point of no return and must happen. The shareholders have agreed on major issues including the funding structure,” Gauis-Obaseki said. With the resolution of the funding arrangement, the immediate hurdle facing the Brass LNG project was the resolution of issues surrounding gas supply, he added. But, those who are to supply the gas are already known to the shareholders. According to the former NNPC GMD, the only outstanding issue was for the shareholders to meet among themselves on the one hand and then with the federal government to provide the comfort that would be required in the process of supplying the gas. He further said of the progress on the project: “The shareholders have agreed on the structure for funding and what remains is the internal mechanics. We know today the contractors that will build the plant. That was not known before. We have only one hurdle and that is the finalisation of issues surrounding gas supply. “But we know those that will supply the gas. And the gas is not imported; it is in Nigeria. What is left is for the shareholders and the

We know those that will supply the gas. And the gas is not imported; it is in Nigeria. What is left is for the shareholders and the suppliers to put their acts together and engage the government as required. No matter what happens, this project will be done suppliers to put their acts together and engage the government as required. No matter what happens, this project will be done”. Dr. Maikanti Baru, the Group General Manager in charge of Liquefied Natural Gas and Power at the NNPC, who also spoke at the event stated that the local shareholders and the Brass LNG project had enjoyed immense technical benefits from ConocoPhillips, through De Oliveira. “We would love if you had taken this project through

the FID but as destiny would have it, you decided to retire,” Baru said. The Brass LNG project is designed to produce 10 million metric tonnes of LNG per year. The projects shareholders are the NNPC with 49 per cent equity; ConocoPhillips, French oil giant, Total and Italian company Eni, holding 17 per cent stake each. NNPC, however, plans to divest 17 per cent of its stake in the project after the FID, out of which Bayelsa and Rivers State Governments

plan to pick up five per cent each with the remaining seven per cent going to NNPC’s strategic investors. ConocoPhillips had last year sold its assets in Nigeria, and along with this development would be divesting its stake in Brass LNG. Already, about $1 billion had been spent early works site of the project, which observers say was a demonstration of the shareholders confidence on project.

Gas

2013 July, SweetcrudeReports

Oil PMS exploration in Mozambique

Oil India, ONGC to buy Mozambique gas stake

ew Delhi – State run Oil India Limited and Oil & Natural Gas Corporation said, Tuesday they will pay $2.48 billion for a 10% stake in an offshore Mozambique gas field, just one week before the deadline for an ONGC bid for Kazakhstan oil assets costing more than twice this amount. The two ventures underscore the urgency India is showing in acquiring foreign oil and gas overseas to help bridge its growing energy deficit and import bills. ONGC said last year it will need to invest as much as $20 billion to realize its target of a sevenfold increase in oil and gas output from overseas by 2030. The Kazakh government is due to announce by July 2 whether it has approved ONGC’s purchase of ConocoPhillips’ 8.4% stake in the huge Kashagan oil and gas field for $5.5 billion, which is being developed by a consortium of international oil companies, India’s oil minister said recently. Oil India and ONGC’s overseas unit, ONGC Videsh Limited, said they will buy Vi d e o c o n M o z a m b i q u e

Rovuma 1 Limited, a unit of Videocon Industries Limited, which owns 10% of the highly prospective Rovuma-1 gas field off Mozambique coast. The field, which holds massive proven reserves of natural gas deep under the seabed, has already been the subject of international jostling as the partners line up the financing and expertise to develop it. Operator Anadarko Petroleum Corporation, is looking to sell 10% of the venture while last year Thailand’s PTT Exploration & Production PCL outbid Royal Dutch Shell Plc in buying an 8.5% share owned by Cove Energy. The Indian acquisition is subject to approvals from the Mozambique and Indian governments and pre-emption rights of other companies in the project, which also include India’s Bharat Petroleum Corporation and Japan’s Mitsui & Company. Oil India expects to complete the deal by the fourth quarter of 2013, it said in a regulatory filing. The Mozambique project is estimated to hold recoverable gas resources of between 35 trillion cubic feet and 65 trillion cubic feet, it

said. ONGC said the Rovuma project is strategically located to supply liquefied natural gas India at a competitive price. “Considering the growing importance of natural gas in the primary energy basket, this acquisition is a significant step by ONGC Videsh towards the energy security of our country,” said ONGC chairman Sudhir Vasudeva. India imports about a quarter of its natural gas requirement, and domestic gas output is falling. S e p a r a t e l y, i f t h e Kazakhstan plan gets

approved, it will help India offset its huge crude-oil import bill. India now imports 73% of its energy needs. It imported crude and other oil products worth $155 billion in the financial year that ended March 31. “East Africa is coming up as the hottest energy destination. All the major energy companies are there. Entry of more Indian companies in Mozambique, given the country’s dependence on energy imports and falling local output, is indeed a good news,” said Praveen Kumar, head of south

Asia at consultancy FACTS Global Energy in Singapore. “The kind of money we are talking about for such energy deals is huge. The state-run companies have deep pockets and also the government backing so I don’t see a problem funding wise,” he said. Production at the Kashagan field, which is years behind schedule and running over budget, is due to start by October at an initial 75,000 barrels a day, rising to 370,000 barrels a day within a year of that, Italian company Eni SpA said in May.

Dangote begins conversion of vehicles to use natural gas

agas Energy Company Limited has commenced the conversion of motor vehicles to use compressed natural gas, CNG, as alternative fuel in Nigeria. The company has successfully converted 200 of 5,000 trucks belonging to Dantrans, the haulage arm of the Dangote Group, which has been scheduled for conversion. The trucks would be running on both natural gas and diesel after the conversion. The conversion ceremony was recently held in Lagos and was witnessed by top officials of

Sagas, Nigeria Gas Company, NGC, and the partnering Prins Autogas West Africa Limited. The development follows the execution of a Memorandum of Understanding, MoU, signed three months ago between Sagas and the NGC. Under the arrangement, the NGC, a subsidiary of the Nigerian National Petroleum Corporation, NNPC, is to exclusively supply Sagas Compressed natural Gas, CNG, for 20 years while Sagas converts PMS and diesel engine vehicles with kits to adapt the engines to the use of gas as obtained elsewhere outside the African continent.

Gas

2013 July, SweetcrudeReports

UK’s Bowland shale ‘holds 37.6 tcm of gas’

Oil drilling rig

he UK’s Bowland shale play holds best-estimate inplace resources of 37.6 trillion cubic metres (1329 trillion cubic feet), a new study by the British Geological Survey has found. The resources at the play come with a low estimate of 23.3 trillion cubic metres and a high estimate of 64.6 trillion cubic metres, the BGS study said. The study conducted for the UK’s Department of Energy and Climate Change, DECC, covered 11 counties in the north of England, centred around the Bowland shale. UK Energy minister Michael Fallon said that “shale gas represents an exciting new potential energy resource for the UK”, and that after the estimates “the next step for industry is to establish how much gas is technically and commercially recoverable”. DECC said technical and commercial limitations meant recoverable volumes were likely to be “substantially lower”, but said the estimates would “give industry and regulators an indication of how best to plan future exploratory drilling”. Greenpeace rounded on the new figures, claiming its research showed hydraulic

Welcoming the new figures, industry lobby Shale Gas Europe said that shale offered “an opportunity to invigorate onshore natural gas production” in the UK fracturing would face “fierce” local opposition and questioning the government’s contention that shale gas could help revive the UK economy when potential production remained years off. Meanwhile, the Chief Secretary to the Treasury Danny Alexander has announced new guidelines on shale permitting and planning that aim to streamline the process. He has also kicked off consultation on tax incentives to encourage exploration of shale gas areas. Welcoming the new figures, industry lobby Shale Gas Europe said that shale offered “an opportunity to invigorate onshore natural gas production” in the UK. Spokeswoman Monica Cristina said that initial exploration to follow would see

“industry demonstrate on the ground that shale gas can be produced in a safe and environmentally sound manner”. The UK government has also brought forward a package of

community benefits created by the industry to give benefit to areas where shale is commercially extracted. Communities near each hydraulically fractured well are to receive £100,000 in funding and 1% of revenues from every production site. Fallon said the measures would “provide a welcome boost for communities who will host shale exploration and production as well as offering strong assurances that operators will engage with them and work to the highest health, safety and environmental standards”. A community engagement charter being piloted by the UK

Onshore Operators Group is to establish industry commitments to “consult openly and honestly” at all stages of the exploration process. Operators are to publish annual reports on their community spending, and the charter is to be regularly reviewed. The BGS is conducting a further study to gauge shale gas potential in the Weald Basin in the southeast of England. To date 176 shale licences have been issued in the UK, and a 14th onshore licensing round to be launched next year is set to draw significant interest from shale explorers.

Hopes for Poland shale 'fading away’

opes that Poland could lead a US-style shale gas boom in Europe are fading fast as energy companies say red tape is delaying commercial output and Warsaw's draft proposals to cut bureaucracy do not go nearly far enough, according to a report. The firms say there is plenty of gas but its exploitation is frustrated by difficult geology and onerous, unclear regulation, according to Reuters. Prospects darkened this year after Marathon Oil and Talisman Energy followed ExxonMobil in pulling out of Poland, which was once seen as Europe's best shale prospect with substantial reserves and a friendly government. These companies may not be the last, unless

one or more of the 46 exploration wells drilled so far starts producing commercial-scale quantities of gas. The government, hoping shale gas will deliver Poland from reliance on energy imports from Russia, is proposing new legislation to ease conditions for investors. "If the law is adopted in its current shape, plus two or three more unsuccessful wells, and other investors will leave," an official with a foreign firm prospecting for shale gas told Reuters, expressing views echoed by several other executives. "The situation is very bad, everyone is discouraged," said a second company official, who also asked not to be identified.

Power

2013 July, SweetcrudeReports

Siemens partners Proton Energy on 500mw power plant YEMIE ADEOYE

iemens, a global technology leader and player in the Nigerian power sector, has signed a cooperation agreement with Proton Energy Limited for the development of a 500 megawatts, MW, Independent Power Plant to be situated in Delta State, Nigeria. The project will be executed in phases beginning with 125MW scheduled to be realised in 2015. At the signing ceremony in Lagos, global CEO of Siemens Industrial Power, Dr. M a r k u s Ta c k e , p l e d g e d Siemens commitment to the development of the energy sector in Nigeria. His words: “Siemens wants not only to be a supplier of goods but also a partner of key players in this developing market and this agreement allows Siemens to become a partner in developing the power generation industry in Nigeria” Those present at the signing ceremony included chairman, Proton Energy, Mr. Gamaliel Ono so d e ; e x e cut i v e v i ce chairman, Proton Energy, Mr. Oti Ikomi, managing director/CEO, Siemens Nigeria Mr. Michael Lakota and Mr. Nasir Giwa, General Manager, Siemens Nigeria Oil & Gas. Siemens has been present in Nigeria since 1970 with active involvement in four key sectors, including energy, healthcare, industry and infrastructure and cities. Proton Energy has been an active player in the Nigerian power sector. In the ongoing privatisation of power generating and distribution companies, Proton Energy was prequalified as sponsorcompany for two PHCN generating companies, Gencos. It is participating as final bidder for Sapele Power Plc and has recently put up a strong bid for the Afam Power Plc.

peaking further on his company and its

A Power plant

projects, Mr. Ikomi, executive vice chairman of Proton, stated that the firm was established a few years ago by business and finance professionals comprising Nigerian, South African and USA-based partners.

hectares land fully owned by the company. The project is being developed by a consortium with Proton Energy Limited as sponsor company and developers and a leading international private equity firm as anchor equity

Siemens has been present in Nigeria since 1970 with active involvement in four key sectors, including energy, healthcare, industry and infrastructure and cities According to him, the company’s key focus is on gas power generation. “Proton Energy Limited was prequalified and made bids for key assets as project sponsors for Sapele Power Plc and Afam Power Plc. This project, the Proton Delta Sunrise Project is to be located on a 27.4

investor. “We are a young and growing company but we operate by international standards. So, we have been seeking for some time an international technical partner to work with us and over a series of interactions we have now come to a stage where Proton and

Siemens are now signing this cooperation agreement. It’s the natural evolution of a strategy we have to get world class technical partners and financial team to speedily implement the project for the benefit of Nigerians,” he said. He stated that the two most critical items for an IPP development are financial structure and technical partnership, adding: “And our personal experience is that Siemens, both from Siemens AG Germany and in particular Siemens Nigeria have shown very good active process to partner with credible and I stress the word credible project developers in Nigeria. So my advice is that, you do your homework, look at the various potential technical partners”. He further stated that from the company’s experience, “we feel very strongly to recommend Siemens as a possible partner for IPP development in Nigeria and even across the world”.

Nasarawa residents decry high transformer levies

esidents of Masaka in K a r u l o c a l government area of Nasarawa state have raised alarm over alleged exploitation by individuals, who own transformers for commercial purposes. They alleged that some persons with private transformers tapped power from the Keffi Transmission Line and were requesting the payment of N40,000 as fee for each household before they could step down the light. According to a resident, "Owners of the transformers charge from N30,000 to N40,000 depending on the size of a compound before we can get the electricity. We also pay connection fee and for the cables to PHCN staff before they can fix the lines."

Power

2013 March, SweetcrudeReports

Cumbersome process in assessing World Bank aids may affect PPAs -IPPs

Geothermal renewable energy

OSCARLINE ONWUEMENYI B U J A Representativ es and Chief Executive O f f i c e r s (CEOs) of Independent Power Producers (IPPs) in Nigeria have complained that the cumbersome processes of assessing various financial packages for investments in power generation from the World Bank may affect the signing of Power Purchase Agreements. The IPPs which met with the management of the Nigerian Electricity Regulatory Commission (NERC) in Abuja criticised what they described as organisational delay in securing risk guarantee and gas supply agreement which are vital to the completion and execution of projects initiated by them. Representatives of over 60 licensed IPPs told the Chairman of NERC, Dr. Sam Amadi who convened a fact-

finding meeting with them, that the process of assessing and utilising the Partial Risk Guarantee (PRG), a form of financial comfort secured by the Federal Government from the World Bank to encourage investments in the power sector, will take an average of two years. According to them, the time consuming processes involved in securing the PRG will in effect delay the signing of Power Purchase Agreements (PPAs) and ultimately, the completion of power projects they had initiated. Specifically, the Executive Director of Supertek Nigeria, Mr. Ray Oguego and Chief Te c h n i c a l A d v i s e r o f Geometric Power, Mr. Ben Caven stated that the IPPs are consistently faced with the challenges of gas supply and bureaucratic bottleneck in securing PRG from the World Bank. Urging the Federal Government to find a creative alternative to the PRG, Caven disclosed that

Specifically, the Executive Director of Supertek Nigeria, Mr. Ray Oguego and Chief Technical Adviser of Geometric Power, Mr. Ben Caven stated that the IPPs are consistently faced with the challenges of gas supply and bureaucratic bottleneck in securing PRG from the World Bank Geometric may fire its first turbine of about 45 megawatts (MW) by the first week of August, adding that initial hitches on the project owing to financial challenges has been sorted out and work resumed at the project site. Responding, Amadi asked the IPPs to open up on their challenges considering their shared fate in the power sector. He noted that the Commission was interested in their success as regards

increase in power generation. “A potential 13,000 megawatts is locked up for as long as the IPPs delay in realising the economic values of their licences and the Commission cannot lay claims to having absolute knowledge of the solutions to the power sector problems. If you have problems you should say so. If you think any part of this model is not working, you should let us know. You can be free with

Geothermal development in East Africa boosted by the AfDB

new project supported by the African Development Group plans to exploit the geothermal potential in the Lake Assal region to enable Djiboutian population’s access to a reliable, renewable and affordable source of energy. Currently Djibouti relies mostly on fossil fuels and some hydropower imports from Ethiopia. The majority of the country’s current generation capacity is situated in Djibouti City. The existing power stations are old, polluting and expensive to operate. In addition, fuel imports are expensive and require important foreigncurrency expenditure. As a consequence, only half the population of the country has access to electricity due to high tariffs. Djibouti is however blessed with substantial geothermal potential, capable of meeting the country’s energy needs and possibly exports to neighboring countries, while reduce CO2 emissions from thermal electricity generation. The geothermal exploration project in the Lake Assal region is structured as Public Private Partnership, where the government of Djibouti is taking the lead on the first exploration and appraisal drilling phase. The private sector will be responsible for the production drilling, steam gathering system and electricity production and evacuation to the national grid. In collaboration with the World Bank, the African Development Bank Group has structured the financing of this project. The first phase will cost approximately US$ 32 million.

the regulator. You can be sure of our credibility. You can trust us that we have good fate in resolving the challenges facing us,” Amadi said. He added that, “This is the time for us to have feedback. The quality of decision is determined by the quality of inputs. If you fail, the Commission will be the primary loser, this is besides the fact that we are all Nigerians and we need electricity.”

Power

2013 July, SweetcrudeReports

Solar panel

Energy security: Imperatives for the Nuclear energy option

OSCARLINE ONWUEMENYI nergy selfsufficiency is imperative for the attainment of our national and regional developmental aspirations in comformity with the key objectives of the National Economic Empowerment and Development Strategy (NEEDS), the New P a r t n e r s h i p f o r A f r i c a â&#x20AC;&#x2122;s Development (NEPAD), and the Millenium Development Goals (MDGs). Empirically, there is a nexus between development and energy, both in terms of generation and consumption. This could be inferred from the fact that the gross domestic product (GDP) of a country, though dependent on a number of macroeconomic factors, is also principally dependent on a number of drivers including energy. Further empirical correlation can between energy and development can be deduced from the per capita GDP and energy usage of some countries. The highly developed and industrialized countries with concomitant high per capita GDPs are also heavy consumers of primary

energy. Generally, about 40 percent of all primary energy consumed is in the form of e l e c t r i c i t y, a n d m o d e r n manufacturing processes depend principally on electric power. The Nigerian Energy Matrix It is no gainsaying that the growth in demand for electricity in Nigeria has far exceeded supply for the past two decades due to a number of reasons including rapid population, growth characterized by high rate of formation of households, and increased level in the expansion of industrial activities engendered by higher productive capacities. Other reasons adduced for the abysmal supply level are inadequate investment in the d e v e l o p m e n t a n d maintenance of electricity infrastructure, extended period of controlled monopoly of the electricity sector by government and its agencies, and undue emphasis on political consideration in the choice of the location of electrification projects rather than economic, technical and other social considerations, among others. Presently, total installed grid

A recent study by the Energy Commission of Nigeria estimated the projected demand based on the current energy usage, with an expected 10 percent industrial growth rate and population growth rate of about 3 percent to be in the range of 28,360MW to 31,240MW by 2015 capacity has stagnated around 6,000MW, comprising mainly of gas, oil and hydro of which less than 4,000MW is available at any time during this period. Indeed, for an estimated

population of over 160 million people, the per capita electricity generation is about 3 0 W, w h i c h i s g r o s s l y inadequate. The significant use of stand-alone diesel-fired

power generators is quite expensive and unsustainable. A recent study by the Energy Commission of Nigeria estimated the projected demand based on the current energy usage, with an expected 10 percent industrial growth rate and population growth rate of about 3 percent to be in the range of 28,360MW to 31,240MW by 2015. The optimal exploitation of an energy resource in any country depends on a number of variables, some of which may be local while others may international connotations.

Privatisation of PHCN firms most transparent - Sambo

ice President Namadi Sambo says the privatisation Power Holding Company of Nigeria, PHCN, has been the most open and transparent privatisation transaction so far in the country. "The privatisation of the Power Holding Company of Nigeria successor companies was the most open and transparent privatisation transaction processes in recent history. "If Nigeria is going to be among the 20 largest economies in the world by the year 2020, the right steps must be taken. The administration of President Goodluck Jonathan is committed to the transformation agenda in all sectors of the economy," he was quoted in a statement by the Bureau of Public Enterprise, BPE, as saying. Sambo made the statement at an investment

forum in New York, where he was represented by Gov. Gabriel Suswan of Benue State. Stating that the current privatisation process for the PHCN involves all tiers of government, he noted that, this was the first time the private sector, the National Assembly, federal, state and local governments would collaborate to ensure an all-inclusive transaction process. He said the Nigeria delegation was at the forum to meet with investors interested in the purchase of 80 percent equity in the 10 National Integrated Power Projects, NIPPs. He said the transaction in the sale of PHCN successor companies followed a transparent process and assured prospective investors that the same level of transparency would be replicated in the sale of NIPPs.

2013 July, SweetcrudeReports

Finance

2013 July, SweetcrudeReports

Diamond Bank

Diamond Bank’s $550m bond fails to attract interest abroad

i a m o n d Bank’s effort to raise $550 million in fresh capital has failed to attract international investors as expected, Chief Finance Officer, Abdulrahman Yinusa, has revealed. The fund, which was expected to come from the international market, is part of the overall $750 million the bank requires to shore up its operations. $200 million of this amount had been raised last year. The bank calculates that the fresh fund would enable it increase lending to the oil and gas, power and infrastructure sectors. France’s BNP Paribas and Afrexim Bank are lead managers to the bonds, but, after a two-week road show in Britain, Switzerland and the United States to rouse the interest of investors, Yinusa said the effort did not yield the desired result.

According to him, the planned bonds issuance would, as a result of this development, happen in July, while pricing and tenor would be dependent on market

conditions. Diamond Bank had wanted to issue the bond at a yield of six to eight percent penultimate week, mirroring the seven percent yield that

rival lender, Fidelity Bank, fetched on its $300 million Eurobond issue in May. “The issue as well as the pricing will happen sometime in July. We have

only done the road show,” Yinusa said, adding that the bank had during the road show met Goldman Sachs and Fidelity fund managers, among other investors. He stated that depending on the pricing and tenor, the bank could settle for an amount between $300 million and $550 million and that it will issue a minimum maturity of seven years in order for the bond to qualify as Tier II capital on its books. Diamond Bank said in an investors’ presentation prepared for the bond that the proposed 10-year bond will be callable after five years and will be listed on the Irish Stock Exchange. Last month, another local bank, Fidelity Bank, issued a $300 million five-year Eurobond paying a seven per cent yield. Also, FBN Holdings Plc, the parent company of First Bank Nigeria, announced a few weeks ago that it plans to raise $500 million by selling a Eurobond this year. According to the chief ex ecut ive officer, FB N Holding, Mr. Bello Maccido, the money would be used for the financing of investments in loans and infrastructure. “The bank intends to expand its investment banking and commercial business as well as insurance,” Maccido said.

Venezuela Oil Chamber wants banks to provide energy industry loans

enezuela’s petroleum industry chamber wants the government to force banks in the South American country to set aside a percentage of their loan portfolio for local oil companies and service providers. Already, Venezuela’s leftist government requires local banks to dedicate a certain percentage of loans toward projects in

industries like tourism and construction, especially for houses built through a politically important state homebuilding initiative for the poor. But, Mario Castillo, an oil chamber official representing the hydrocarbons-rich state of Anzoategui, said applying similar requirements for the oil sector was necessary as it would help stimulate investment. The funds made available through the proposal would

“generate financing, credit for companies and, in this case, if there are debts or delays in payments it would make new investment flow,” Mr. Castillo told reporters on the sidelines of an energy conference in the coastal city of Puerto La Cruz. The chamber represents local contractors and service providers. The proposal comes at a time when partners of national energy giant, Petroleos de Venezuela SA, or PdVSA, complain of

delayed payments and mounting debt owed to them. Venezuela’s government relies on PdVSA to fund social programs that keep the ruling party popular with the poor, but analysts say that has also resulted in cash flow problems for the company. Mr. Castillo did not specify what percentage of loans banks would need to allocate to the energy sector under his organisation’s proposal, which is still in early stages.

2013 July, SweetcrudeReports

Finance

Tribunal orders Mobil to pay $83m education tax to FIRS

he Tax Appeal Tribunal, Lagos Zone, has ordered M o b i l Producing Nigeria Unlimited to pay 83.4 million dollars (N13 billion) education tax to the Federal Inland Revenue Service, FIRS. The tribunal gave the order while delivering judgment on an appeal filed by the oil company against the FIRS. Chairman of the five-man tribunal, Mr Kayode Sofola, SAN, said the amount represented the company’s education tax liability for 2008. The company had instituted the appeal on May 5, 2011 when FIRS issued with it an education tax liability of 83.4 million dollars for 2008. The appellant’s counsel, Mr T. Emuwa, had claimed that the assessment breached an agreement signed by the company with the Federal Government of Nigeria and the Nigerian National Petroleum Corporation, NNPC. Emuwa said the M e m o r a n d u m o f Understanding, MoU, was first signed in 1986 and renewed in 2000. He said the 2000 MoU allowed the company to deduct all amounts paid to other agencies from the tax due to the federal and state governments FIRS had through its counsel, Mrs B.H. Oniyangi, claimed that the 2000 MoU was signed for a three-year term, adding that its validity ended on Jan.1, 2003. Oniyangi held that the federal government, through a letter issued by the Department of Petroleum Resources, DPR, on January 17, 2008, also confirmed that the MoU had lapsed. According to her, the 2000 MoU was replaced by the Petroleum Profits Tax Act, PPTA, which was used to issue the disputed assessment. Delivering the judgment, Sofola agreed that the said MoU was only for a threeyear term, noting that there was no evidence before the

panel that it was renewed. He said: “The 2000 MoU thus expired at the end of 2002. The parties never did anything to keep it alive longer, as stated in clause 7.1. “In effect, clause 7.1 contains an option to renew, exercisable

at the joint instance of all the parties. This option was never exercised, and thus no renewal or extension was triggered.” Sofola said the appellant was no longer entitled to make deductions allowed

under the 2000 MoU, in calculating their education tax. “The PPTA is the legislation in force and cannot be subordinated to the mere contemplations of the MoU. We uphold the

respondent’s (FIRS) assessment of the appellant to education tax of $83,414,793. “We order the appellant to pay accordingly,” the tribunal chairman added.

Students in the classroom

CBN extends deadline on Know your customer

entral Bank of Nigeria, CBN, says it has extended by eight months the deadline for banks and other financial institutions to comply with Know Your Customer, KYC, requirements. The CBN disclosed

this in a circular to all banks and financial institutions signed by Mr. A. Ikem for the Acting Director, Financial Policy and Regulation department. The document is entitled “Additional Know Your C u s t o m e r , K Y C , requirement in respect of Designated Non-Financial

Businesses and Professions, DNFBPs – Extension of deadline”. Additional KYC requirements are with respect to bureaux de change, hotels, law firms, accounting firms and consulting firms referred to as Designated NonFinancial Businesses and

Professions, DNFBPs. The circular said: “In consideration of some challenges encountered by Special Control Unit against Money Laundering, CBN has decided to further extend the second deadline of April 30 by eight months to December 31.”

2013 July, SweetcrudeReports

Finance

Olusegun Aganga, Trade and Investment Minister

Nigeria, Egypt trade volume reaches $150m

r. Ashraf Salama, t h e Egyptian ambassad or in Nigeria, said trade volume between Nigeria and Egypt has reached $150 million. But, he was of the view that this volume was unimpressive. Salama disclosed this at the first Nigeria-Egypt Forum in Abuja, saying the record was far below the capabilities of the economies in both countries. He said there was need for the two countries to work together to explore the business opportunities available in their various domains. The ambassador urged both countries to partner in order to boost the bilateral trade in the near future by utilising the opportunities available for business in Egypt and Nigeria. Salama also urged the two countries to tap into the vast resources and expertise

available to them. His words: "Our countries have vast resources and the two nations have the same aspirations that centre on economic prosperity, youth empowerment, viable education systems, better services and equal d e v e l o p m e n t a n d opportunities. "The embassy is working with the relevant authorities

in Egypt and Nigeria to set the legal framework that would facilitate the movement of people and goods between our countries. "We believe the next meeting of Egypt- Nigeria binational committee will help boost our trade relations and set up mechanism to enhance cooperation in all fields". Representative of the

Nigeria Embassy in Egypt, Alhaji Mohammed Isa, expressed concern over the recorded volume of trade, which he said favoured Egypt. Maintaining that the two countries had come a long way, he said the relationship between the two had always been political tothe neglect of the economic aspect. Isa called on Nigerian

business men to explore business opportunities in Egypt in order to balance the bilateral trade between the two countries. Executive Secretary, Nigeria Investment Promotion Commission, NIPC, Mustafa Bello, in his address said the present administration had made investment in Nigeria easier through the provision of incentives. Bello was represented by a director in the commission, Mrs. Gana Wakili.

Nigeria returns to capital market, sells $Ibn bond

igeria returned to the capital market after two years of absence and sold $1 billion dollar bond with ease, according to Minister of Finance, Dr Ngozi Okonjo-Iweala. Okonjo-Iweala disclosed this to journalists in Abuja while

speaking on the recently Okonjo-Iweala said: "The concluded road show in reason we are excited is Europe and US to float the because as you know, these billion dollar bond to are turbulent times, international investors. especially following According to her, the bonds, expectations of tapering of which were four times Qualitative Easing by the o v e r s u b s c r i b e d , w e r e US Federal Reserve Bank. improvements on investorsâ&#x20AC;&#x2122; "So, the fact that Nigeria response to the $500 million could go to the bond market, bonds floated in 2011. after waiting a while and we

got four times our subscription, show confidence in the strength of the Nigerian economy," she said. She stated that the transaction attracted top investors primarily from US, Europe and Asia.

2013 July, SweetcrudeReports

Finance

Lagos bags award for bond issue

he Lagos State Government h a s b e e n awarded 'Best Local Currency Bond Award for 2012' for successfully floating N80 billion bond in November last year. The award was presented to the State in London by EMEA Finance, a leading magazine in the United Kingdom, published by Exporta Publishing and Events Limited. The magazine took special recognition of the N80 billion bonds which the state floated in 2012 and commended the state for taking the bold step to address its infrastructure regeneration projects. The N80 billion bond is the first tranche of the total N167.5 billion second bond programme of the Lagos State Government which is the largest sub-national bond ever issued on the Nigerian bond market. Presenting the award to the Lagos Stateâ&#x20AC;&#x2122;s Commissioner for Finance, Mr. Tokunbo Abiru, Publisher and Chief Executive Officer of EMEA Finance, Mr. Christopher Moore, said Lagos has won the award across three continents namely Europe, the Middle East and Africa. Moore said: "The magazine has a vision to be independent voice, that speaks at the highest level of integrity and journalistic ethics for the financial community and others across the EMEA region namely, Europe, the Middle East and Africa. Lagos State Government is, therefore, not only a national or continental winner but an intercontinental winner," Moore said. Abiru, who spoke on the award, said part of the credibility of the bond was the way and manner Lagos State has managed its debt management strategy. "Essentially part of the credibility of the bond is the way and manner Lagos State has managed its debt

management strategy which has been adjudged to be very efficient. This is also influenced by the fact the debt that we raised provided the fund that we used to expand the economy of Lagos because they are essentially monies

that are channelled to capital expenditure," Abiru said. According to him, the qualification would also include the fact that Lagos State boasts of very strong fiscal strategy in terms of fiscal revenue.

He added: "The borrowing that we contract is essentially to complement our yearly recurrent revenue surplus which is typically about 40 per cent of our yearly revenue. "What this means is that

the fact that all our recurrent expenditures are covered by our revenues, the revenue we generate, and it is the net recurrent surplus that will contract loans such as has given us this achievement tonight to complement to fix our capital expenditure infrastructures".

Central Bank of Nigeria,head office, Abuja

CBN votes N200bn for SMEs, others

n its efforts to bring more people into the formal economy, the Central Bank of Nigeria, CBN, has set aside N220 billion for lending to micro, small and medium scale enterprises, SMEs, across in the country. CBN's deputy

director, Development Finance Department, Uzoma Onuoha, said 60 per cent of the fund will be used to empower the womenfolk. He stated this in Umuahia, Abia State, at the CBN seminar for business editors and finance correspondents. According to him, the fund, to be launched in August, is part of plans by the CBN to

reduce the size of the population presently excluded from the financial system from 46.3 per cent in 2010, to 20 per cent by 2020. He said some mileage has reduced to 39.7 per cent at the end of last year. In his contribution at a panel discussion on the topic "strengthening and enhancing financial

inclusion," Prince Emeka Obasi, publisher of Hallmark Newspapers, said that financial empowerment of the populace is the prerequisite for financial inclusion. According to him, "once a man is lifted out of poverty, h e i s i n c l u d e d automatically. It is not a monetary but fiscal policy issue.â&#x20AC;?

Labour

2013 July, SweetcrudeReports

NUPENG, PENGASSAN blame Petroleum Minister for industrial unrest

ELUONYE KOYEGWAEHI

EADERS of the two unions in Nigeria’s Petroleum industry; Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) and its Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), have accused the Minister of Petroleum Resources, of responsible for the industrial unrest in the sector. N U P E N G a n d PENGASSAN claimed the Minister had continued to evade meeting with them to discuss issues affecting industrial relations and unfair labour practices in the sector, as well ensuring the multinational oil companies respect extant labour laws or honour agreements among others. Both unions equally blamed the Minister for the issues that forced NUPENG to embark of a three-day warning strike and the threat by PENGASSAN to declare a similar three-day warning strike last week before the Minister of Labour and Productivity, Chief Emeka Wogu and the Group Managing Director of NNPC, intervened. NUPENG had expressed dismay with the Minister of Petroleum Resources for abandoning a meeting which the minister summoned on Monday July 1, 2013, at the commencement of the threeday warning strike and travel abroad. PENGASSAN, President Babatunde Ogun, did not hid his misgiving for the perceived un-labour friendly attitude of the minister at a briefing to suspend NUPENG’s warning strike, calling on the minister to change in the interest of industrial peace in oil and gas industry. It will be recalled that NUPENG had last week declared a three-day

Mrs Diezani Alison-Madueke

nationwide warning strike with a further threat to make it an indefinite total strike until the Labour Minister and the management of NNPC intervened. NUPENG was protesting among others, perceived unfair labour practices by Shell Petroleum Development Company, SPDC, Chevron Nigeria Limited and Agip Oil Company. It was also protesting the alleged refusal of National Association of Road Transport Owners, NARTO, to implement the signed collective bargaining agreement with the Petroleum Tanker Drivers, PTD, and the sorry state of our roads across the Nation. The union had warned that should government and other concerned fail to address its grievances after the three-day warning strike, it would declare an indefinite strike. Specifically, NUPENG

The union had warned that should government and other concerned fail to address its grievances after the three-day warning strike, it would declare an indefinite strike lamented alleged worsening unfair labour practices by SPDC, Chevron and Agip Oil, accusing them of inflicting inhuman treatment on Nigerians through casualisation and outsourcing of workers among others. It noted that if the agreement reached with the multinational companies at a meeting called by Chief

Wogu, in May 2012, was implemented, these issues would have been resolved. It has been reported revealed that only 5% of Nigerians working in the Petroleum industry are permanent staff. Others were said to be either contract, casual or outsourced workers with conditions of work not commensurate with

industry standards and best practices globally. It will be recalled that NUPENG had on June 6, 2013, in Lagos, issued a 14day strike notice to the Federal Government over disputes with SPDC Chevron and Agip, threatening a nationwide strike. The union called on the Federal Government to summon all stakeholders’ national conference on Oil and Gas to address among others, labour issues in the sector before the expiration of the ultimatum or the union would declare an indefinite nationwide strike. Briefing on the disputes with the multinational oil companies, after its Central Working Committee, CWC, in Lagos, President of NUPENG, Achese Igwe, accused Agip Oil of t e r m i n a t i n g t h e appointment of 93 contract workers that had worked with for between 25 and 35 years, without benefits despite directive by the Ministry of Labour and Productivity to do, and also promoting 96 workers who have spent over 15 years as contract workers as NUPENG members to Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, contract staff instead of converting them to full time workers. Igwe accused Chevron of not only converting workers from contract labour tom service labour and refusing them collective bargaining agreement and joining union, while he accused SPDC of refusing to have Collective Bargaining Agreement, CBA, with the workers and also denying them the right to join union, among others. According to him, contract workers in Agip were presently on strike in Port Harcourt and if the issue was not resolved as soon as possible, it would degenerate into national strike because of issues in SPDC and Chevron, saying “we can no longer fold our arms and allow fellow Nigerians to be enslaved in their country.” He said : “Before now, Chevron had what was called the big six contractors paying over 1800 workers.

2013 July, SweetcrudeReports

Labour

ELUONYE KOYEGWAEHI

FORMER Petroleum And Natural Gas Senior S t a f f Association of Nigeria, PENGASSAN, accountant, Mr Douglas Atagamhen, has dragged the body to the National Industrial Court, NIC, Ikoyi Lagos, for allegedly refusing to pay his entitlement after he was sacked in questionable circumstances. He was alleged to have gone to abroad to study without approval, an allegation he vehemently denied insisting that he got approval for a study leave before he travelled. Though at the time of this report, the date for the hearing of the case, was not immediately known, but n his claims, Atagamhen, through his lawyer Mr Gani Adetola Kaseem SAN, argued that he was an Accountant in the employment of the defendant (PENGASSAN), before he was later moved to the Kaduna zonal office in the capacity of Senior Organizing Secretary. Atagamhen, who is asking the court to order PENGASSAN to pay N8.3million as entitlement, said when he applied for a two-year study leave for a Master of Business Admission degree course in Strayer University, Virginia, USA, PENGASSAN through its General Secretary, Bayo Olowoshile, gave him a conditional approval. According to him, “Having worked for the Defendant Association and my appointment having not been determined before July 14, 2011; I am entitled to be fully remunerated for the period in accordance with extant conditions of service for staff of the Defendant Association. Having not been paid any part of my terminal benefits before February 2012, I am consequently deemed to have remained in the employment of the Defendant Association and therefore to be remunerated up to that time.” Atagamhen lamented that PENGASSAN General Secretary gave him conditional approval to his study leave, after reiterating that the claimant could not be granted leave with pay but assured him that he would be

Babatunde Ogun, President, PENGASSAN.

Ex-staff drags PENGASSAN to court over unpaid entitlement assisted with the payment of his furniture and housing allowances during the period of his leave. He said “I accepted the conditional grant of my study leave without pay and subsequently commenced on the study leave and resumed study at Strayer University, Virginia, USA. While on my study leave, I was surprised to receive a letter through my email declaring me to have been away without official leave. “Consequently, I returned to Nigeria and resumed work on March 8, 2010 at the Kaduna zonal office of the Defendant Association. Upon my resumption, I started to perform my official duty. I visited the Headquarters of the Defendant Association to inform the General Secretary of my resumption to duty and also formally tendered a

The case of Atagamhen, was particularly pathetic because he was at that time the only qualified accountant in the national secretariat letter.” According to investigation, Atagamhen was one of educated staff transferred out of the national secretariat considered threat to a top Secretariat staff because of their educational qualifications as well as ethnic background in

2010. The case of Atagamhen, was particularly pathetic because he was at that time the only qualified accountant in the national secretariat. E v e n w i t h i n PENGASSAN, it generated a lot of controversies and

arguments why an accountant could be transferred to Kaduna office as an organizing secretary. Many considered it as punitive meant to frustrate him out of the organization. However, there was nothing anybody could do because the person involved was said to have the backing of one “Oga at the top”. It is being alleged that the same oga at the top is sitting on the payment of Atagamhem’s entitlement. The irony of the transfer was that one inexperienced account staff was drafted to head the account department. Some secretariat staff who spoke on condition of anonymity, expressed apprehension over the development and fear similar if not worse fate.

2013 July, SweetcrudeReports

Labour

FG, labour agree on how to resolve industrial issues

Oil workers

ELUONYE KOYEGWAEHI

HE Federal Government of Nigeria, oil workers and o t h e r stakeholders have agreed on a 11 point way forward to the lingering labour issues in the country’s Oil and Gas sector. Issues agreed on at the end of a stakeholders meeting held NNPC Towers, Abuja, presided over by the Minister of Labour and Productivity, Chief Emeka Wogu, focused on issues agreed upon at previous meetings of the social partners and needed validation by the stakeholders, were reiterated and resolutions reached. Specifically, the issues were insecurity/pipeline vandalism/oil theft, bad roads, gazettee of Industrial Arbitration Panel (IAP) and National Industrial Court (NIC) awards, unionisation, unfair labour practices, outsourcing and contract

The rule of law must be obeyed by all stakeholders, therefore, unionisation is recognise as an inalienable right of workers as established by the constitution of the Federal Republic of Nigeria s t a f f i n g , nomenclature/harmonisation of agencies, Industry Bill (PIB), Pension, National Association of Road Transport Owners, NARTO/ Petroleum T a n k e r s Drivers(PTD)/Federal Inland Revenue Service (FIRS) and Stakeholder’s forum. In a resolutions signed government’s representatives, leaders of the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) its Petroleum and Natural Gas Senior Staff Association of

Nigeria (PENGASSAN) and o i l c o m p a n i e s representatives, it was a g r e e d t h a t o n insecurity/pipeline vandalism/oil theft, “Government has put a Committee in place to look into the issues of security. PENGASSAN and NUPENG will be further engaged by all the relevant Government Agencies and other Security Institutions on the progress being made.” For the bad roads, it was resolved that “Government is

already dealing with the issue extensively including applying resources from the Subsidy Reinvestment and Empowerment Programme (SURE – P), and will continue in its efforts to rehabilitate the roads that are still posing challenges. The Port Harcourt Refinery access road would be captured while handling the East – West road. Rehabilitation of the railways is already ongoing to complement the road network in the country. Ministers of Labour and Productivity, Niger Delta, and Works are committed to ensuring that the roads mentioned by the Stakeholders are being rehabilitated in fulfillment of the Transformation Agenda of Mr. President.” On gazettee of IAP/NIC awards, the meeting agreed that “both PENGASSAN and NUPENG should make available, the list of all unimplemented IAP/NIC Awards to the Minister of

Labour and Productivity for necessary action.” Concerning the issue of unfair labour practices, unionisisation, outsourcing and contract staffing, it was agreed that “the unions should submit the list of all unfair labour practices to the 13- man committee headed by Permanent Secretary, Ministry of Petroleum Resources. All other transition issues have been referred to the NNPC GMD‘s Committee as had been mandated by the Secretary to the Government of the Federation for resolutions within two weeks. The alleged anti- union practices of indigenous Oil and Gas Companies should also be referred to the 13 – man Committee. On the alleged breaches of the Guidelines on Contract Staffing and Outsourcing in the Oil and Gas sector, the unions are encouraged to make available specific cases on such breaches to the 13 – man Committee and the Federal Ministry of Labour and Productivity.” About unionisation, the meeting resolved that “the Rule of Law must be obeyed by all stakeholders, therefore, unionization is recognize as an inalienable right of workers as established by the Constitution of the Federal Republic of Nigeria and the Standards of the International Labour Organisation (ILO). Free Trade Zone (FTZ) unionization and all other unionization issues should be referred to the 13-man Committee headed by Permanent Secretary, Ministry of Petroleum Resources. Vam Onne and Pressure Control will be invited for possible out of court settlement. The issue concerning Sendje Berge FPSO is on Jurisdictional scope between NUPENG and Maritime Workers Union of Nigeria. DPR and NAPIMS are to provide a Report on the nature and status of the FPSO in question to the 13man Committee headed by Permanent Secretary, Ministry of Petroleum Resources.

2013 July, SweetcrudeReports

Labour

Containers at Lagos Port

Maritime workers extend ultimatum over dispute with NPA

ELUONYE KOYEGWAEHI ARITIME Workers Union of Nigeria, MWUN, has extended the the ultimatum given to Nigeria Ports Authority (NPA) to pay 11 months unpaid salaries of Tally clerks, onboard security men among dispute to avoid industrial unrest. The ultimatum was extended for 14 days following intervention with the Federal Government to the Minister of Labour and Productivity, Chief Emeka Wogu. It was gathered that the Minister had invited stakeholders to the dispute including Nigerian Maritime Administration and Safety Agency, NIMASA, to a meeting over the matter following threat by the union to shut down the nation’s ports where it was resolved that the union should give authorities concerned more time to address its demand. It will be recalled that the union had petitioned President Goodluck

Jonathan, threatening to shut down the nation’s ports over unpaid 11 months salaries to members by the Nigerian Ports Authority, NPA, among others issues. In a petition dated June 12, 2013, the union alleged that NPA had for the past 11 months had no paid Tally clerks, onboard security men and others , but had been spending not less than N3000million monthly to pay illegal employees known as Cargo Surveyors, who had nothing to do at the ports. It gave the management of NPA 14-day ultimatum pay the tally clerks, onboard security men their 11 month unpaid salaries and disengage the cargo surveyor who had no defined to job in the ports, but receive fat pay, failing which the nation’s ports would be shut down indefinitely. According to the union, the Dockworkers including the Tally Clerks and On-board Security men were registered by the National Dock Labour Board, NDLB, to work in the Sea Ports, Private Terminals and Jetties and were trained in t h e a c t o f c a r g o handling/loading and

discharging of ships. The union said section 35 of the Nigeria Dock Labour Decree No. 37 of 1999 which established the Joint Dock Labour Industrial Council, JODLIC, described a Dock as “a person registered under the Decree to perform duties connected with the loading arid discharging of ships.” Specifically, MWUN, the so called cargo surveyors of NPA are not known under the Nigerian Maritime Administration and Safety Agency, NIMASA, Act 2007, which regulates Maritime Labour activities in Nigerian Ports, hence not permitted by law to perform the role of registered Tally Clerks. According to the petition, “On-board Security men are involved in watching over cargo to avoid theft and over boarding and to prevent unauthorized shore leave through the gangway by crew members. Their function also helps to prevent attack of vessels in the Ports by terrorist and pirates in line with requirement of the ISPS code on port and ship

Tallying services is for the benefit of the ship, the cargo owners, the port and indeed the nation. That is why the ship/ship agent-must countersign or stamp every cargo record from the ship security and safety.” “Tallying services is for the benefit of the ship, the cargo owners, the port and indeed the nation. That is why the ship/ship agentmust countersign or stamp every cargo record from the ship. It is through physical recording of cargo landed that discrepancy can be detected. It is through Quay Apron Tallying that undeclared tonnage can be detected in the interest of

national economy. It is the record of Tally Clerks that serve as evidence that the ship has delivered to the consignee’s nominated port destination.” “It is unjust and undesirable for NPA Management to attempt to substitute registered Tally Clerks with Cargo Surveyors because looking at all past and subsisting legislations; there has always been provision for registered Tally Clerks and Onboard Security men because of their strategic importance to the Maritime industry and tacit security value as “whistle blowers”. As a Union, we say emphatic no to any move to replace the trained experienced tally clerks and onboard security men with Cargo Surveyors. The move shall be resisted by our members in all seaports nationwide. This is because we cannot stand any further labour dislocation in our seaports and the attendant gruesome consequences on the affected Nigerian Workers, their families and dependants.

Solid Mineral

2013 July, SweetcrudeReports

Lack of raw materials, infrastructure stifling Ajaokuta Steel —Minister

inister of M i n e s and Steel Developm ent, Mr Musa Sada, has identified lack of infrastructure and raw materials as the two major challenges facing the Ajaokuta steel mills. Sada stated this in Abuja while presenting a mid-term report on the progress and achievements of the mines and steel development ministry at the 2013 Ministerial Platform. "The problem of Ajaokuta, to make it really clear, is twofold; right at the inception of Ajaokuta, certain key issues were left outstanding, and these key issues are the issues of raw materials and infrastructure. "There are attendant infrastructure requirement that must have to be attended to; currently anybody who is familiar with that will know that the Itakpe-Warri rail line is almost up and ready. "That particular line was actually established to support steel production in that area. Another sort of infrastructure that needs to be in place is the infrastructure from the mine site to the factory itself; and these are the issues that this government is currently

Ajaokuta Steel production line squarely addressing," the minister said. According to him, the Jonathan administration has recorded several achievements in the sector to grow the economy of the country. Sada listed some of the achievements to include improved general awareness of the viability of the sector to

both local and international entrepreneurs. He explained that the ministry had discovered high grade of iron ore in Gidan Jaja in Zamfara, Lamba in Bauchi State, and Gidan Buzu in Yobe. The minister said that the ministry had also discovered 10 new minerals, a

development, which, he said, totaled the number of minerals in the country to 44. He said only recently, the National Extractive Industry and Transparent Initiative, NEITI, singled out the Nigerian minerals sector as the most transparent industry in the

whole world. "This development has increased the revenue generation as shown by the recent NEITI Audit thus creating more jobs opportunities in the country." Sada said that the reforms introduced by the government had facilitated the establishment of 1154 new quarries, thereby taking the number of quarries in the country to 1,710.

EU historic vote brings transparency to extractive industries

y 2015, all oil, mining, gas and l o g g i n g companies in Europe will have to disclose the payments they make to governments for access to natural resources. This is the outcome of a vote in Strasbourg, France, on June 12, in this regard. "The vote was history in the making. The new rules will be a major new

weapon in the global fight against corruption, ensuring that citizens of resource rich countries can hold their governments to account for the exploitation of their natural resources," S&D MEP Arlene McCarthy, the European Parliament’s rapporteur for the new Transparency laws, said. In 2008 alone, African oil, gas and mineral exports were worth 9 times the value of

international aid (296 billion EUR Vs 33 billion EUR). Arlene continued: "After today’s vote 70% of the world’s extractive industry will be covered by tough transparency rules now and the European Union has led the way in setting a new global standard for transparency. The adoption of these laws is a watershed moment in the global drive for greater transparency." Euro MP Arlene McCarthy has worked closely with

NGOs including The One Campaign, Oxfam, Global Witness and the umbrella group Publish What You Pay, PWYP, in order to secure this tough new law. Arlene added: "After 18 months of tough negotiations we have a set EU rules of that we can be proud of and that show how effective cooperation, between legislators, citizens and action groups, can deliver real change." Ali Idrissa, PWYP Niger

Coordinator said: "In Niger, and in other African countries, PWYP members have been campaigning for a transparent and responsible management of natural resources. In revealing payments, this legislation will support us in our campaigning so that we can call on our governments to spend the revenues in a way that will benefit current and future generations.

Solid Mineral

2013 July, SweetcrudeReports

In search of minerals

Nigeria’s mining sector holds promise for the future

OSCARLINE ONWUEMENYI igeria today is in a wave of m a r k e t reforms in m a n y segments of its economy including the privatization of government-owned companies and mining assets. After years of dithering and being weighed down under squandered oil revenues and rising debt levels, the government finally demonstrated the political will to implement market friendly policies. To that end, Nigeria, over the past couple of years has began privatizing the country’s mineral and steel resources, and has initiated a program of reform and mining regulations. For long, West Africa has been a destination of choice for mining executives the world over, with countries like Burkina Faso, Ghana, Ivory Coast and Niger being

actively explored and mined. Now, Africa’s most populous nation, Nigeria, fortuitously located in this remarkably prospective region, is opening up its mining sector and taking aggressive step to woo foreign mining companies as it seeks to become an alternate mining destination. Gold has

been the predominant mineral of choice in the region. But Nigeria, thus far known for its oil and gas deposits (tenth – largest reserves in the world and third – largest after OPEC at 36 billion barrels), is now offering a whole range of 34 solid minerals including

precious metals,base metal, rate earths and minerals such as uranium to prospective miners for development. More recently, the country has attempted to modernize the mining and minerals s e c t o r , i m p r o v e international best practices

Coal Mining: A Key Focus

iven the implications that continued power shortages have for the Nigeria economy, coal mining seems to be an area of immediate development concern, especially considering that Nigeria has proven deposits of over 1.5 billion tons, after only partial exploration. The advantages of coal mining is that though it is open to mining companies, the government is not dependent on them. Thermal power-

generating companies would happily takeover the responsibility of developing coalmines since it would automatically, build fuel linkages with their power generating plants. The focus on developing coal mines will also speed up development of the power infrastructure, since plants will come up at the pithead to avoid haulage costs and the national grid will also get built up to transmit power across the

country. Rapidly developing the coal industry is in Nigeria’s best interest but the interest of foreign investors is in exploiting the most attractively priced mineral, gold. The price of gold in the international market today is nearly three times its production cost. “Coal should be a key target given the energy aspect and the opportunity for large coal mining projects for power

through the institution of well thought-out regulations as well as establishment of the Mining Cadastre Office to ensure efficient management of m ining licenses for exploration activities. Nigeria is also undergoing a political transformation of enormous proportion. For the past 10 years, the country has seen uninterrupted civilian rule, which is the longest since independence. One of the major failures of the previous military regimes was the inability to diversify the economy away from its dependence on oil revenues. Developing the country’s solid mineral wealth promises to have a considerable impact on the economy since mineral deposits are geographically spread across more than 450 communities in the country. The oil industry on the other hand has concentrated in the swamps of the Niger delta. According to Steve Vaughn, a partner at Heenan Blaikie Business Law Group and a leading expert on international mining law, Nigeria’s mineral sector has not historically received “enough attention as other countries in the region did from investors, but that is changing now.” Some potentially serious investors, however, have sounded a note of caution on the type of companies that may be attracted to Nigeria’s new liberal mining environment. However, according to J. Howard Bills, senior exploration manager, Axmin Inc, a Toronto-based gold mining company, “Nigeria will have to derive rules to keep out the suitcase companies, i.e. those that simply enter to acquire lucrative licenses only to sell them later at a huge profit.” World Class Minerals The mineral spread in Nigeria is significant with evidence of 34 different minerals distributed in Nigeria’s richly endowed geology.

generation exists, especially since there are handsome coal properties in Nigeria,” says Barey Guarnera. He adds that, “Coal mining will remain critical because of the peak load deficit factor. But the focus on industrial commodities is critical for the development of the metals and mining sector. The focus on industrial commodities will broaden the universe of mining companies interested in investment in Nigeria.”

Freight

2013 July, SweetcrudeReports

NIMASA moves to stop forgery of Certificate of Competency

Chief Gbola Akinola (R) and other participants at the Arbitration seminar, Dispute Resolution in the Ports Sector

TOJU VINCENT

HE Nigerian M a r i t i m e Administration and Safety A g e n c y (NIMASA) said it is planning to introduce measures to stop unscrupulous persons from forging its Certificate of Competency (COC) for seafarers. NIMASA’s Director of Maritime and Seafarers Standard Department, Mr Vincent Udoye, disclosed this to newsmen at the venue of a

meeting between the agency and stakeholders in maritime last week in Lagos. He said that the agency had only just concluded certificate verification and background checks on Nigerian seafarers. NIMASA, therefore, urges all stakeholders to continue to support it to eradicate forged certificates in the Nigerian Maritime Industry. “NIMASA is currently going ahead to establish an ongoing seafarers’ database to enable their employers and other maritime administrations to verify the authenticity of Nigerian COCs,

Udoye said. The director said that NIMASA had also begun auditing existing maritime training institutions in the country to eliminate the fake ones and improve service delivery. Udoye said that to boost maritime development and ensure effective regulation of safety and security in Nigerian waters, NIMASA had continuously striven to build strategic alliances with other government agencies. He listed these agencies to include the Maritime Police

and the Armed Forces. A direct outcome of this is the establishment of the Maritime Guard Command (MGC), which comprises of a detachment of Naval Personnel commanded by a Senior Naval Officer and presently stationed in the agency,” the director said. Udoye said that the International Labour Organisation had a fiveyear action plan to achieve rapid, widespread and effective implementation of the Maritime Labour Convention 2006.

According to him, the Convention will come into force in August, having been ratified by 30 member states. However, he noted that NIMASA alone could not undertake the task of maintaining cleaner seas and ensuring safer ships, a task which he described as enormous. Udoye urged stakeholders in the sector to explore areas where they could partner with NIMASA so that collectively, they could help Nigeria to benefit from its maritime.

2013 May, SweetcrudeReports

Freight

2013 July, SweetcrudeReports

An LNG Ship

NIMASA vs NLNG:

The raging war over levies

YEMIE ADEOYE

he last month has been a long one for the N i g e r i a n M a r i t i m e Administration and Safety Agency, NIMASA, and the Nigeria Liquefied Natural Gas Limited, NLNG, embroiled in a 'tax war'. NIMASA is claiming nonpayment by NLNG of statutory levies and charges due to it (NIMASA) over the years. NLNG, on the other hand, is pleading tax exemption as reason why it has not paid and will not pay the levies. But amid the raging crisis, observers say there is need for a review and remodification of Nigeria's tax laws such that they become less contradictory and there is clarity even for the layman. The origin of the crisis is that at exactly 17.20hrs on Friday, June 21, 2013, two

NIMASA boats, with 15 naval officers on board, arrived the NLNG loading bay on Bonny Island, Rivers State, to enforce a blockade on the company. One NLNG vessel - LNG Imo and a chartered vessel - Torm Thames - were ordered to remain at the loading bay, whilst another NLNG vessel LNG Oyo - remained outside the Bonny Channel. Since then, the NLNG and NIMASA had been locked in fierce battle over the issue of non-payment of the statutory levies and charges which NIMASA claims are due to it from NLNG. According to NLNG, NIMASA subsequently issued Ship Detention Orders on June 22, specifically detaining three NLNG ships (LNG Enugu, LNG Oyo, LNG Imo) and barring them from accessing or leaving the company’s loading bay. “These developments are in flagrant disregard of the court injunction issued by the Federal High Court in Lagos in

Amid the raging crisis, observers say there is need for a review and re-modification of Nigeria's tax laws such that they become less contradictory and there is clarity even for the layman

Suit No FHC/L/CS/847/2013 by Honorable Justice M.B. Idris, presiding, on Tuesday 18th June 2013, against the Attorney General of the Federation, Global West, and any other parties including Nigerian Maritime and Safety Agency, NIMASA, from imposing any charges or taking any steps to block, detain or prevent access by the company’s owned or chartered vessels, whether

inbound or outbound from Bonny channel or elsewhere in Nigeria,” NLNG said in a statement. NIMASA is, however, claiming that this course of action was forced on it by NLNG's refusal and failure to abide by the outcome of the negotiated settlement arrived at through the mediation process it willingly instigated and subscribed to, after reaching

agreement with NIMASA on its outstanding debt and paying US$20m out of over US$150 million, as well as its continued flagrant disregard for Nigerian laws. “Contrary to NLNG's position, NIMASA is not aware of any court order against it or any suit brought by NLNG against NIMASA. By its action, the NLNG has trivialised the mediation process and the position of the Federal Government of Nigeria whose Nigerian National Petroleum Corporation, NNPC, owns and holds 49 per cent of the shares in NLNG and which endorsed the agreement reached that NLNG should pay its taxes/levies and observe all its obligations under the laws of Nigeria in which it is operating, NIMASA contended. The development has become topical in the maritime industry and has generated very strong views from stakeholders in the industry. While some people view the development as a creation of the Federal Government and should be strictly resolved by the government rather than the courts, others see the recourse to the judiciary as necessary for prosperity as tax evasion by corporate organisations was on the increase in Nigeria.

Freight THE Maritime Arbitration Association of Nigeria, MAAN, recently held its 5th practical maritime seminar with the theme â&#x20AC;&#x153;Dispute Resolution in the ports sector: an agenda for economic growthâ&#x20AC;? In this interview with Toju Vincent, the group President Chief Gbola Akinola said having in place a forum for settling commercial disputes between or amongst carriers and shippers through the use of Alternative Dispute Resolution, ADR, is essential to the development of the Nigerian economy.

2013 July, SweetcrudeReports

DISPUTE RESOLUTION IN THE PORTS SECTOR:

An agenda for economic growth

You did said that the association has proposed to the Federal High court to pass the small claims settlement to arbitrators so as to save time and resources could you throw more light on this?

Excerpts: What exactly do you hope to achieve with this yearly seminar put together by the association?

irstly, this is not a gathering of legal minds, it is a gathering of arbitrators because arbitration is an all partyâ&#x20AC;&#x2122;s process, it is for all stakeholders in the maritime industry because this is the maritime arbitrators association of Nigeria. The idea is to let all stakeholders in the maritime industry be aware of the essence of this Alternative Dispute Resolution mechanism which avails them as opposed to their going to court. Often times you have small claims between parties charterers, ship owners and agents and all that can be resolved within the shortest of time but because of the fact that they are not aware of the Alternative Dispute mechanism of arbitration, where they rush to is the law courts. More often than not, you find out that they lose time, they lose business, they lose opportunities and most times they go to court and never come back as friends. What we try to do now is to educate all the stakeholders, to make them aware of arbitration, to make them aware of the existence of the Maritime Arbitration Association of Nigerian, and that we have rules that guide our process of arbitration. The fundamental points we seek to achieve firstly is that when you are negotiating a contract that you are able to put an arbitration clause because if there is no clause

Gbola Akinola

What we try to do now is to educate all the stakeholders, to make them aware of arbitration, to make them aware of the existence of the Maritime Arbitration Association of Nigerian, and that we have rules that guide our process of arbitration

that touches arbitration in your contract you cannot resolve to arbitration at all. If you put it as part of your contract when dispute has not arisen because contemplated or anticipated it, whenever dispute does arise, it is easy to undertake the process of arbitration. If on the other hand you did not include the clause as at the time you were negotiating the contract, parties can again meet and go to arbitration, that is what we call submission agreement and with that you can proceed to

arbitration. Once these fundamentals are understood by stakeholders, then you have given room for arbitration to grow and when arbitration grows and it is understood by all stakeholders, it will only help in the business that they have gone into. That is the essence of this yearly programme and it is continue to enlighten our members, to enlighten the stakeholders in the maritime industry and to make life better and make business better for all parties concern.

What Maritime Arbitration Association of Nigeria has done is to proposed to the Chief Judge of the Federal high court that we would like to partner with the Federal High court in assisting with claims settlements. it is likened what operate in the Lagos High court and the relationship it has with the multi-door court house . At times, you have small claims dispute coming up, if there is no arbitration clause, the natural place they go to is the court room but then with this collaborative effort, we expect the Federal high court to refer such matters to, once the court knows that this matter is a small claim that can be easily settled and it is not a complex matter, it will encourage parties to refer it to arbitration. Do not forget that I said that arbitration is private , so you do not subscribe to it, you cannot use it, but by the time the court introduces to the parties and if they are comfortable with the idea, they will go for it and that will speed up the dispute resolution mechanism and it will free the court matter of a lot of matters that burden its dockets and at the same time parties will go home happier that in shorter period of time their disputes have been resolved. You talked about arbitration, mediation, negotiation and conciliation I was a bit confused when you use these words. Are these part of the arbitration mechanism?. You see, Alternate Dispute Resolution is an alternate CONTINUES ON PAGE 38

Freight

2013 July, SweetcrudeReports

Agenda for economic growth CONTINUED FROM PAGE 37

dispute mechanism to court system. Under the ADR,you have negotiation, you have conciliation, you have mediation and you have arbitration, but there are things to be explained. Arbitration is quasi-judicial because the outcome of arbitration is an award which is likened to the judgment of a court. Now in all these ADR processes, issue of parties buying into the process is key, they are party driven. In mediation, by the time you go before a mediator, an agreement is signed, sometimes you have parties going back home and rescinding on the agreement. There is no way you can enforce such an agreement, but the way the Multi-door court house and Lagos High court has done it is such that when that agreement is obtained, it now goes back to the judge that the matter stems from to put his affirmation on it to make binding so that you can enforce the agreement.. It is only the court that has the power of enforcement, neither arbitration; negotiation; nor mediation conciliation has those quasijudicial authorities. But in arbitration, once you get your award, the only next step you need to take the award to the high court and register it. Once you register it, it is taken as a judgment of that same court and thereafter the enforcement procedure and processes of the state high court is used to realise the award One of the resources persons suggested that the assets and banks accounts of the offending party be put on hold while the arbitration process is on, do you share this view? What I think he was trying to suggest is that you run through a process and you get an award and you take it to the court for enforcement because an award can either be voluntarily obeyed by the parties. It is when an award is not honoured that you go for enforcement.

When you go for enforcement, some litigants, especially the bellicose ones will again start the process of filling processes challenging

the award or trying not honour the award. What the suggestion about, is if we are able have a process recognise

to is to as

the one that operate for Assets Management Corporation of Nigeria (AMCON) because for AMCON there is an Act

In arbitration, once you get your award, the only next step you need to take the award to the high court and register it

and there is practice direction given by the Federal high court which assist the process of realising the indebtedness, it will be such that when you get an award and the other party is refusing honour it, you can use such processes to get a preservatory order, it could be an asset or an account. It is not enough that you want to freeze somebodyâ&#x20AC;&#x2122;s account, it must be premise on the fact there is an award and the other party is refusing to pay and you know that the other party has so much somewhere. It is hoped that by the time the issue of arbitration gain ground in the maritime industry, it will boost international trade; do you share this line of thought? I do because there are so many users of the ports, a lot of them do not have the patience of going to court, and a lot of them sleep over their rights when there are disputes, a lot of them take the laws into their hands.

Akinola

89 ships expected in Lagos ports this month

ighty nine ships are expected to arrive the Lagos ports from July 1 to July 29, a c c o r d i n g t o information from the Nigerian Ports Authority, NPA. NPA said this in its

publication, â&#x20AC;&#x153;Shipping Position,â&#x20AC;? made available to newsmen in Lagos. It said that 14 of the ships would sail in with vehicles. The document also indicated that 16 of the ships would arrive with petroleum products, while 29 other ships would sail in with

containers. NPA said that other ships would sail in with general cargoes, bulk wheat, fresh fish, maize, bulk fertiliser, bulk gypsum, crude palm oil, palm olein, boats, bulk urea, bulk sugar, base oil and bulk salt. By the July 1, six ships

were waiting to berth and discharge petrol, while three other ships would discharge bulk malt and bulk fertiliser. Twenty-two ships were discharging containers, bulk wheat, steel products, bulk fertiliser, fresh fish and petroleum products, the NPA said.

Motoring

2013 July, SweetcrudeReports

Nine hottest selling cars this year

ar sales are on a t e a r . Through the first five months of 2013, U.S. car sales are up by 8.2%, compared to the same period last year. Some of the more popular models have posted even more substantial growth, well into the double digits. Most of the popular models with major increases in sales have undergone some significant changes recently. In most cases, it has been a design overhaul of the entire model. Alec Gutierrez, senior market analyst at Kelley Blue Book, explained why redesigns of vehicles have had such an impact on the sales. “These are all the latest and greatest redesigns, so they really feature the best in terms of tech, in terms of features and amenities, in terms of style and design, and really in terms of fuel economy.” The increasing importance of fuel economy gave some redesigned models a leg up on older models. It also led many auto manufacturers to introduce new hybrid models, which has boosted sales for some of the other models on this list. Lexus introduced the Lexus ES-300h to its ES line in 2012. Toyota released a hybrid model under its Avalon brand. The importance of fuel efficiency also has led many auto buyers to transition to one of the fastest-growing segments in the auto business — crossover utility vehicles, or CUVs. Gutierrez explained that these cars are meeting the desire for the space and utility of an SUV with better fuel efficiency. CUV sales through May are up 13.9%.

Based on sales data provided by Kelley Blue Book, 24/7 Wall St. reviewed the nine models that sold more than 25,000 units in the United States between January and May of 2013, and are up by 25% compared to the same period of last year. We also reviewed the past five full years of sales. All combined fuel economy estimates listed are based on the smallest engine size and the least expensive configuration, with numbers provided by the U.S. Environmental Protection Agency.

year as well — the Korean carmaker has sold more than 104,000 Elantras through May, up from slightly more than 80,000 at the same point in 2012. The Elantra was the second-most popular car sold by Hyundai in the first five months of 2013, after the Sonata. Likely contributing to sales, Hyundai added a coupe to its Elantra lineup for 2013. All three current Elantra models start at less than $20,000.

7. Chevrolet Tahoe

Ford Escape

These are the nine hottest cars this year.

9. Ford Escape 2013 Jan.-May sales: 127,932 2012 Jan.-May sales: 98,667 Pct. change in sales: 29.7% Fuel economy: 26 mpg Ford Motor Co. sold 127,932 Escapes in the first five months of 2013, a 29.7% increase from the same period in 2012. In 2008, Ford sold 139,434 units for the year. The Ford Escape’s 2013 model was the first full redesign since its introduction in 2001. The new model includes a panoramic moonroof, an automated parking option and a softtouch dashboard. Popular Mechanics named the Escape “Car of the Year” in its 2013 Automotive Excellence Awards, praising the car’s “excellent engine options, abundance of technology and great price.”

Hyundai Elantra

Chevrolet is on pace to sell 84,161 Tahoes in 2013, a sizable increase from the 68,371 sold in 2012. Sales of the SUV have fluctuated in the past five years. The best year for Tahoe sales was in 2008, when Chevrolet sold 88,655. Sales then plummeted to 69,953 in 2009 before rising in 2010 and 2011. U.S. News and World Report rated the 2013 Tahoe the best affordable large SUV, beating out the Chevy Suburban, Ford Expedition and GMC Yukon. The publication said the Tahoe “offers good interior material quality with plenty of standard features, even on the base trim. Fully equipped, the Tahoe is a near-luxury SUV.”

6. Ford Explorer

Chevrolet Tahoe

2013 Jan.-May sales: 84,646 2012 Jan.-May sales: 63,269 Pct. change in sales: 33.8% Fuel economy: 20 mpg Sales of the Explorer cratered in 2009 and 2010, when fewer than 50,000 units were sold. But Explorer sales have skyrocketed in the past two years, with the help of a redesign for the 2011 model year that transformed the model from a traditional SUV to a crossover vehicle. In 2011 and 2012, Ford sold roughly 135,700 and 164,200

8. Hyundai Elantra 2013 Jan.-May sales: 104,081 2012 Jan.-May sales: 80,114 Pct. change in sales: 29.9% Fuel economy: 32 mpg Last year, Hyundai sold nearly 188,000 Elantras, or more than double the number it sold in 2009. Hyundai is on pace to pass that figure this

2013 Jan.-May sales: 35,067 2012 Jan.-May sales: 26,847 Pct. change in sales: 30.6% Fuel economy: 17 mpg

Ford Explorer

CONTINUES ON PAGE 40

Motoring

2013 July, SweetcrudeReports

Nine hottest selling cars this year CONTINUED FROM PAGE 39

3. Toyota Avalon

Explorers, respectively. Just through May 2013, sales for the model totaled almost 85,000 in the United States, an increase of more than 33% from the first five months of 2012. Some of this increased demand may have come from the addition in 2013 of the Sport trim of the model — the most expensive available on the Explorer at more than $40,000.

2013 Jan.-May sales: 30,945 2012 Jan.-May sales: 14,883 Pct. change in sales: 107.9% Fuel economy: 25 mpg

5. Subaru Forester 2013 Jan.-May sales: 40,578 2012 Jan.-May sales: 29,863 Pct. change in sales: 35.9% Fuel economy: 23 mpg Subaru is on pace to sell 97,387 Foresters in 2013, if sales continue at the rate of the first five months. This would be a major jump from the 76,347 sold in 2012. The Forester is the second most popular car sold by Subaru, after the Outback. The newly redesigned 2014 Forester, which went on sale earlier this year, was ranked as the top small SUV by Consumer Reports, which praised the vehicle’s “space-efficient design, large windows and big square doors,” among other things. The Forester was also the only small SUV to pass a front-offset crash test conducted by the Insurance Institute for Highway Safety.

Subaru Forester

Lexus ES

4. Lexus ES 2013 Jan.-May sales: 27,813 2012 Jan.-May sales: 14,485 Pct. change in sales: 92% Fuel economy: 24 mpg The Lexus ES passed 56,000 in sales in 2012, after a difficult year in 2011 when sales fell to just 40,873. Likely helping to boost sales, Lexus released its sixthgeneration ES-Series in 2012, which also included the launch of a new hybrid version of the ES 350, called the ES 300h. Buyers responded well to the new ES-Series vehicles, and so far in 2013 sales are up 92% from the year before. One possible incentive: the ES 300h gets 40 mpg combined, versus 24 mpg for the standard version model.

The Toyota Avalon’s sales more than doubled in the first five months of 2013, compared to the same period in 2012. In fact, the 30,945 Avalon units sold from January to May is more than Toyota Motor Corp. sold in any full calendar year between 2009 and 2012. The 2013 redesign “brought with it sleek new styling, a stiffer chassis, and improved ride and h a n d l i n g q u a l i t i e s , ” according to Edmunds. In addition, Toyota released the Avalon Hybrid in 2012, which receives 40 mpg combined city and h i g h w a y , compared to the 25 mpg of the nonhybrid version.

2.Mazda CX-5 Toyota Avalon

Mazda CX-5

2013 Jan.-May sales: 31,201

Nissan Pathfinder

2012 Jan.-May sales: 11,480 Pct. change in sales: 171.8% Fuel economy: 29 mpg The Mazda CX-5 was new on the market in 2012. It has sold 43,319 units, more than any other model it produces except the Mazda3. In order to increase fuel efficiency, the Madza introduced its SkyActiv technology platform on the CX-5, which includes an efficient engine and transmission, as well as a lightweight chassis. Even with the model’s strong start last year, sales of the CX-5 have picked up even more in 2013, with more than 31,000 sold through the first five months of this year. Among the changes made for the 2014 model year, which is already out, is that the higher end versions come with a more-powerful engine that still maintains good fuel economy.

1. Nissan Pathfinder 2013 Jan.-May sales: 38,179 2012 Jan.-May sales: 12,644 Pct. change in sales: 202.0% Fuel economy: 22 mpg No top-selling car increased its sales more than the Nissan Pathfinder, as 202% more units were sold in the first five months of 2013, compared to the same period in 2012. The redesigned Pathfinder’s 22 mpg combined is higher than previous models. The vehicle also weighs 500 pounds less. Following a test drive, USA Today said the car is “quiet, soaks up bad pavement pretty well and is tastefully appointed inside.”

Technology

2013 July, SweetcrudeReports

The Inverter: Solution for Africa’s electricity crises

power inverter, or inverter, is an electrical power converter that changes direct current (DC) to alternating current (AC);[1] the converted AC can be at any required voltage and frequency with the use of appropriate transformers, switching, and control circuits. Solid-state inverters have no moving parts and are used in a wide range of applications, from small switching power supplies in computers, to large electric utility high-voltage direct current applications that transport bulk power. Inverters are commonly used to supply AC power from DC sources such as solar panels or batteries. The inverter performs the opposite function of a rectifier. The electrical inverter is a high-power electronic oscillator. It is so named because early mechanical AC to DC converters were made to work in reverse, and thus were “inverted”, to convert DC to AC.

Square wave

The earliest electronic inverters produced a square wave, which can be seen as a sine wave sampled twice per cycle, i.e., at the Nyquist limit. A square wave has a very high harmonic content and a peak-to-RMS voltage ratio of 1. Because electronic loads are usually sensitive to peak voltage while resistive loads such as incandescent lamps respond to the RMS value, the square wave is unsuitable for general use.

Modified sine wave

A “modified sine wave” (MSW) waveform spends equal time at each level in the sequence +,0,-,0,... A 240V 50 Hz inverter therefore generates +339V for 5 ms, 0V for 5 ms, -339V for 5 ms and 0V for 5 ms before repeating the cycle; the corresponding values for 120V 60 Hz are +/170V and 4.167 ms. This can

including maximum power point tracking and antiislanding protection.

Solar micro

mechanical relays are switching to its output.

Grid tie

be seen as a sine wave sampled four times per cycle at the peaks and zero crossings. The big advantage of the modified sine wave is that it has the same peak-to-RMS voltage ratio as a true sine wave, i.e., sqrt(2) = 1.414, while being as easy to generate as a square wave. This has made MSW inverters very popular. They are compatible with most loads except those unusually sensitive to the harmonic content, e.g., certain laser printers, fluorescent lighting, audio equipment, and clocks that count power line zero crossings.[2] Costs are typically ~$0.10USD/Watt, much cheaper than true sine wave inverters. Most AC motors will run on MSW inverters with an efficiency reduction of about 20% due to the harmonic content.[3]

Multilevel

A multilevel inverter synthesizes a desired voltage from several levels of direct current voltage as inputs. The advantages of using multilevel topology include reduction of power ratings of power devices and lower cost. There are three topologies - diode clamped inverter, ûying capacitor inverter and cascaded inverter.

Pure sine wave

A pure sine wave inverter produces a nearly perfect sine wave output (less than 3% total harmonic distortion) that

is essentially the same as utility-supplied grid power. Thus it is compatible with all AC electronic devices. This is the type used in grid-tie inverters. Its design is more complex, and costs more per unit power.[4]

Resonant

Resonant inverters produce sine waves with LC circuits to remove the harmonics from a simple square wave. Typically there are several series- and parallel-resonant LC circuits, each tuned to a different harmonic of the power line frequency. This simplifies the electronics but the inductors and capacitors tend to be large and heavy. Its high efficiency makes this approach popular in large uninterruptible power supplies in data centers that run the inverter continuously in an “online” mode to avoid any switchover transient when power is lost. A closely related approach uses a ferroresonant transformer, also known as a constant voltage transformer, to remove harmonics and to store enough energy to sustain the load for a few AC cycles. This property makes them useful in standby power supplies to eliminate the switchover transient that otherwise occurs during a power failure while the normally idle inverter starts and the

A grid tie inverter transmits power into the electric power distribution system. Such inverters must synchronise with grid, produce little harmonic distortion and implement elaborate precautions to avoid “islanding”, feeding power into an otherwise deenergized distribution line and endangering nearby linemen. With the popularity of grid-tied photovoltaic (solar power) systems, many gridtie inverters include built-in maximum power point tracking.

Synchronous

A synchronous inverter connects to a grid and allows routing to or from the grid depending on need.

Stand-alone

A stand-alone inverter is the opposite of a grid tie inverter. They are commonly used on vehicles and in remote renewable energy systems producing power from photovoltaic panels and small wind turbines. To minimize cost, most stand-alone inverters are of the modified sine wave type except when a specific load cannot tolerate the high harmonic content.

Solar

A solar inverter can be fed into a commercial electrical grid or used by an off-grid electrical network. Solar inverters have special functions adapted for use with photovoltaic arrays,

A solar micro-inverter converts direct current from a single solar panel. Microinverters contrast with conventional string or central inverter devices, which are connected to multiple solar panels.

Air conditioner

An air conditioner inverter modulates the frequency of the alternating current to control the speed of the air conditioner motor to achieve continuous adjustment of temperature control.

Uninterruptible power supplies

An uninterruptible power supply (UPS) uses batteries and an inverter to supply AC power when main power is not available. When main power is restored, a rectifier supplies DC power to recharge the batteries.

Induction heating

Inverters convert low frequency main AC power to higher frequency for use in induction heating. To do this, AC power is first rectified to provide DC power. The inverter then changes the DC power to high frequency AC power. HVDC power transmission With HVDC power transmission, AC power is rectified and high voltage DC power is transmitted to another location. At the receiving location, an inverter in a static inverter plant converts the power back to AC. The inverter must be synchronized with grid frequency and phase and minimize harmonic generation. Variable-frequency drives A variable-frequency drive controls the operating speed of an AC motor by controlling the frequency and voltage of CONTINUES ON PAGE 42

Technology

2013 July, SweetcrudeReports

Solution for Africaâ&#x20AC;&#x2122;s electricity crises CONTINUED FROM PAGE 41 the power supplied to the motor. An inverter provides the controlled power. In most cases, the variable-frequency drive includes a rectifier so that DC power for the inverter can be provided from main AC power. Since an inverter is the key component, variablefrequency drives are sometimes called inverter drives or just inverters. VFDs that operate directly from an AC source without first converting it to DC are called cycloconverters. They are now commonly used on large ships to drive the propulsion motors.

Electric drives

vehicle

Adjustable speed motor control inverters are currently used to power the traction motors in some electric and diesel-electric rail vehicles as well as some battery electric vehicles and hybrid electric highway vehicles such as the Toyota Prius, BYD e6 and Fisker K a r m a . V a r i o u s improvements in inverter technology are being developed specifically for e l e c t r i c v e h i c l e applications.[5] In vehicles with regenerative braking, the inverter also takes power from the motor (now acting as a generator) and stores it in the batteries.

Air conditioning

An inverter air conditioner uses a variable-frequency drive to control the speed of the motor and thus the compressor.

Electroshock weapons

Electroshock weapons and tasers have a DC/AC inverter to generate several tens of thousands of V AC out of a small 9 V DC battery. First the 9VDC is converted to 400 - 2000V AC with a compact high frequency transformer, which is then rectified and temporarily stored in a high voltage capacitor until a preset threshold voltage is reached. When the threshold(set by way of an airgap or TRIAC) is reached, the capacitor dumps its entire load into a pulse transformer which then steps

it up to its final output voltage of 20 - 60 kV. A variant of the principle is also used in electronic flash and bug zappers, though they rely on a capacitor-based voltage multiplier to achieve their high voltage.

The general case

A transformer allows AC voltage to be stepped up or down to a desired voltage at the same frequency. Inverters, plus rectifiers for DC, can be designed to convert from any voltage, AC or DC, to any other voltage, also AC or DC, at any desired frequency. The output power can never exceed the input power, but efficiencies can be high, with a small proportion of the power dissipated as waste heat.

Circuit description Basic designs

In one simple inverter circuit, DC power is connected to a transformer through the center tap of the primary winding. A switch is rapidly switched back and forth to allow current to flow back to the DC source following two alternate paths through one end of the primary winding and then the other. The alternation of the direction of current in the primary winding of the transformer produces alternating current (AC) in the secondary circuit. The electromechanical version of the switching device includes two stationary contacts and a spring supported moving contact. The spring holds the movable contact against one of the stationary contacts and an electromagnet pulls the movable contact to the opposite stationary contact. The current in the electromagnet is interrupted by the action of the switch so that the switch continually switches rapidly back and forth. This type of electromechanical inverter switch, called a vibrator or buzzer, was once used in vacuum tube automobile radios. A similar mechanism has been used in door bells, buzzers and tattoo machines. As they became available with adequate power ratings, transistors and various other types of semiconductor switches have been incorporated into inverter circuit designs. Certain

ratings, especially for large systems (many kilowatts) use thyristors (SCR). SCRS provide large power handling capability in a semiconductor device, and can readily be controlled over a variable firing range.

Output waveforms

The switch in the simple inverter described above, when not coupled to an output transformer, produces a square voltage waveform due to its simple off and on nature as opposed to the sinusoidal waveform that is the usual waveform of an AC power supply. Using Fourier analysis, periodic waveforms are represented as the sum of an infinite series of sine waves. The sine wave that has the same frequency as the original waveform is called the fundamental component. The other sine waves, called harmonics, that are included in the series have frequencies that are integral multiples of the fundamental frequency. The quality of the inverter output waveform can be expressed by using the Fourier analysis data to calculate the total harmonic distortion (THD). The total harmonic distortion (THD) is the square root of the sum of the squares of the harmonic voltages divided by the fundamental voltage:

design approaches address various issues that may be more or less important depending on the way that the inverter is intended to be used. The issue of waveform quality can be addressed in many ways. Capacitors and inductors can be used to filter the waveform. If the design includes a transformer, filtering can be applied to the primary or the secondary side of the transformer or to both sides. Low-pass filters are applied to allow the fundamental component of the waveform to pass to the output while limiting the passage of the harmonic components. If the inverter is designed to provide power at a fixed frequency, a resonant filter can be used. For an adjustable frequency inverter, the filter must be tuned to a frequency that is above the maximum fundamental frequency. Since most loads contain inductance, feedback rectifiers or antiparallel diodes are often connected across each semiconductor switch to provide a path for the peak inductive load current when the switch is turned off. The antiparallel diodes are somewhat similar to the freewheeling diodes used in AC/DC converter circuits.

The quality of output waveform that is needed from an inverter depends on the characteristics of the connected load. Some loads need a nearly perfect sine wave voltage supply to work properly. Other loads may work quite well with a square wave voltage.

Advanced designs

H bridge inverter circuit with transistor switches and antiparallel diodes There are many different power circuit topologies and control strategies used in inverter designs. Different

Top: Simple inverter circuit shown with an electromechanical switch and automatic equivalent auto-switching device implemented with two transistors and split winding auto-transformer in place of the mechanical switch. Square waveform with fundamental sine wave

component, 3rd harmonic and 5th harmonic Fourier analysis reveals that a waveform, like a square wave, that is antisymmetrical about the 180 degree point contains only odd harmonics, the 3rd, 5th, 7th, etc. Waveforms that have steps of certain widths and heights can attenuate certain lower harmonics at the expense of amplifying higher harmonics. For example, by inserting a zerovoltage step between the positive and negative sections of the square-wave, all of the harmonics that are divisible by three (3rd and 9th, etc.) can be eliminated. That leaves only the 5th, 7th, 11th, 13th etc. The required width of the steps is one third of the period for each of the positive and negative steps and one sixth of the period for each of the zero-voltage steps.[6] Changing the square wave as described above is an example of pulse-width modulation (PWM). Modulating, or regulating the width of a square-wave pulse is often used as a method of regulating or adjusting an inverterâ&#x20AC;&#x2122;s output voltage. When voltage control is not required, a fixed pulse width can be selected to reduce or eliminate selected harmonics. Harmonic elimination techniques are generally applied to the lowest harmonics because filtering is much more practical at high frequencies, where the filter components can be much smaller and less expensive. Multiple pulsewidthor carrier basedPWM control schemes produce waveforms that are composed of many narrow pulses. The frequency represented by the number of narrow pulses per second is called the switching frequencyor carrier frequency. These control schemes are often used in CONTINUES ON PAGE 43

Technology

2013 July, SweetcrudeReports

Solution for Africa’s electricity crises CONTINUED FROM PAGE 42 variable-frequency motor control inverters because they allow a wide range of output voltage and frequency adjustment while also improving the quality of the waveform. Multilevel inverters provide another approach to harmonic cancellation. Multilevel inverters provide an output waveform that exhibits multiple steps at several voltage levels. For example, it is possible to produce a more sinusoidal wave by having split-rail direct current inputs at two voltages, or positive and negative inputs with a central ground. By connecting the inverter output terminals in sequence between the positive rail and ground, the positive rail and the negative rail, the ground rail and the negative rail, then both to the ground rail, a stepped waveform is generated at the inverter output. This is an example of a three level inverter: the two voltages and ground.[7]

Three phase inverters

positive and negative sections of the square-wave such that the harmonics that are multiples of three are eliminated as described above. When carrier-based PWM techniques are applied to sixstep waveforms, the basic overall shape, or envelope, of the waveform is retained so that the 3rd harmonic and its multiples are cancelled.

3-phase inverter switching circuit showing 6-step switching sequence and waveform of voltage between terminals A and C (23states) To construct inverters with higher power ratings, two sixstep three-phase inverters can be connected in parallel for a higher current rating or in series for a higher voltage rating. In either case, the output waveforms are phase shifted to obtain a 12-step waveform. If additional inverters are combined, an 18step inverter is obtained with three inverters etc. Although inverters are usually combined for the purpose of

explain the source of the term inverter. Early AC-toDC converters used an induction or synchronous AC motor direct-connected to a generator (dynamo) so that the generator’s commutator reversed its connections at exactly the right moments to produce DC. A later development is the synchronous converter, in which the motor and

inverter circuit The commutation requirements of SCRs are a key consideration in SCR circuit designs. SCRs do not t u r n o f f o r commutateautomatically when the gate control signal is shut off. They only turn off when the forward current is reduced to below the minimum holding current, which varies with each kind of SCR, through some

generator windings are combined into one armature, with slip rings at one end and a commutator at the other and only one field frame. The result with either is AC-in, DC-out. With an M-G set, the DC can be considered to be separately generated from the AC; with a synchronous converter, in a certain sense it can be considered to be “mechanically rectified AC”. Given the right auxiliary and control equipment, an M-G set or rotary converter can be “run backwards”, converting DC to AC. Hence an inverter i s a n i n v e r t e d converter.[8][9]

external process. For SCRs connected to an AC power source, commutation occurs naturally every time the polarity of the source voltage reverses. SCRs connected to a DC power source usually require a means of forced commutation that forces the current to zero when commutation is required. The least complicated SCR circuits employ natural commutation rather than forced commutation. With the addition of forced commutation circuits, SCRs have been used in the types of inverter circuits described above. In applications where inverters transfer power from a DC power source to an AC power source, it is possible to use AC-to-DC controlled rectifier circuits operating in the inversion mode. In the inversion mode, a controlled rectifier circuit operates as a line commutated inverter. This type of operation can be used in HVDC power transmission systems and in regenerative braking

Controlled rectifier inverters

3-phase inverter with wye connected load Three-phase inverters are used for variable-frequency drive applications and for high power applications such a s H V D C p o w e r transmission. A basic threephase inverter consists of three single-phase inverter switches each connected to one of the three load terminals. For the most basic control scheme, the operation of the three switches is coordinated so that one switch operates at each 60 degree point of the fundamental output waveform. This creates a line-to-line output waveform that has six steps. The sixstep waveform has a zerovoltage step between the

achieving increased voltage or current ratings, the quality of the waveform is improved as well.

HISTORY Early inverters

From the late nineteenth century through the middle of the twentieth century, DC-toAC power conversion was accomplished using rotary converters or motor-generator sets (M-G sets). In the early twentieth century, vacuum tubes and gas filled tubes began to be used as switches in inverter circuits. The most widely used type of tube was the thyratron. T h e o r i g i n s o f electromechanical inverters

Since early transistors were not available with sufficient voltage and current ratings for most inverter applications, it was the 1957 introduction of the thyristor or silicon-controlled rectifier (SCR) that initiated the transition to solid state inverter circuits. 12-pulse line-commutated

operation of motor control systems. Another type of SCR inverter circuit is the current source input (CSI) inverter. A CSI inverter is the dual of a sixstep voltage

source inverter. With a current source inverter, the DC power supply is configured as a current source rather than a voltage source. The inverter SCRs are switched in a six-step sequence to direct the current to a three-phase AC load as a stepped current waveform. CSI inverter commutation methods include load commutation a nd p a ra l l e l ca p a ci t o r commutation. With both methods, the input current regulation assists the commutation. With load commutation, the load is a synchronous motor operated at a leading power factor. As they have become available in higher voltage and current ratings, semiconductors such as transistors or IGBTs that can be turned off by means of control signals have become the preferred switching components for use in inverter circuits. Rectifier and inverter pulse numbers Rectifier circuits are often classified by the number of current pulses that flow to the DC side of the rectifier per cycle of AC input voltage. A single-phase half-wave rectifier is a one-pulse circuit and a single-phase full-wave rectifier is a two-pulse circuit. A three-phase halfwave rectifier is a threepulse circuit and a threephase full-wave rectifier is a six-pulse circuit.[10] With three-phase rectifiers, two or more rectifiers are sometimes connected in series or parallel to obtain higher voltage or current ratings. The rectifier inputs are supplied from special transformers that provide phase shifted outputs. This has the effect of phase multiplication. Six phases are obtained from two transformers, twelve phases from three transformers and so on. The associated rectifier circuits are 12-pulse rectifiers, 18-pulse rectifiers and so on... When controlled rectifier circuits are operated in the inversion mode, they would be classified by pulse number also.

Community

2013 July, SweetcrudeReports

Crude oil spill in the Niger Delta

Shell under pressure over Niger Delta oil spills

oyal Dutch Shell’s claims concerning oil spill incidences in Nigeria has been faulted by Amnesty International and Holland’s National Contact Point for the Organisation for Economic Co-operation and Development, OECD. Shell blames most spills in the Niger Delta on thieves breaking into pipelines, a crime known as ‘bunkering’. A n i n d e p e n d e n t investigation into how the

Shell blames most spills in the Niger Delta on thieves breaking into pipelines, a crime known as ‘bunkering’ Organisation for Economic Cooperation and Development’s guidelines are enforced found discrepancies between Shell’s story and other accounts of the size and cause of spills. Holland’s National Contact Point for the OECD have

asked Shell to be prudent while publishing spill investigation data. It also called on Shell to publish figures since January 2011, when the oil giant began putting information about leaks on its website.

Also, the group reiterated concerns by the United Nation that investigators are at the mercy of the oil companies when assessing the size and severity of spills. The report arose from a complaint by Friends of the Earth and Amnesty International, which claimed that Shell heavily influenced spill investigations. "Shell has repeatedly stated operational spills are going down and sabotage is going up. This is all based on

a process where the investigator is being investigated," Audrey Gaughran of Amnesty said. Urging a more independent assessment to offset weakness in local regulation, she pointed to improvements in the way it reports spill information since 2011. She also urged Shell to publish all investigations carried out prior to 2011, potentially exposing the company to multi-million pound lawsuits. Shell, however said its Nigerian unit, theShell Petroleum Development Company, SPDC, is in compliance with the OECD Guidelines for Multinational Enterprises.

Community

2013 July, SweetcrudeReports

Bayelsa youths protest alleged marginalisation by NCDMB

undreds of youths in Bayelsa State, under the aegis of National Youth Council of Nigeria, NYCN, Bayelsa State chapter, recently protested alleged marginalisation by Nigerian Content Development and Monitoring Board, NCDMB, in the implementation of local content policy of the Federal Government. The youths stormed the headquarters with banners, which read National Youth Council of Nigeria, Bayelsa State Chapter, Non-Violent Project, The NYCN Bayelsa State Enforcing Transparency in the Implementation of the Nigerian Content Act and Guideline in the Aspect of Training and Capacity Building Plan as Regards the S.S.A.G.G.S Project in E k e r e m o r L o c a l Government Area, A community service action p l a n a g a i n s t unemployment, lack of skills, ability, capability and

capacity, among others. The youths stormed the NCDMB head office in Yenagoa as early as 6am, barricaded the gate and locked out staff and visitors. NCDMB occupies Revenue House, which was donated to it by the state government as its national headquarters on Lambert Eradiri Road in the state capital is not ready. At least 12 police patrol vans were at the scene, as the youths chanted solidarity songs. "The board is not involving the locals in its projects and activities in the state. We want capacity building and training. "We are worried because NCDMB is not carrying youths along particularly in the current Southern Swamp Associated Gas Gathering System, SSAGGS, project in E k e r e m o r L o c a l Government Area of Bayelsa State contracted by Shell Petroleum Development Company," he said.

Fire out break

SNEPCo, LIMGE collaborate to combat fire in Lagos We are aware of the fact that the Lagos Island area is densely populated with close clusters and has always been prone to fire incidents even from colonial times

he Shell N i g e r i a Exploration Company, SNECo, and Lagos Island Millennium Group on the Environment, LIMGE, have teamed up to fight fire disasters in Lagos. The joint effort lead to the recent launch of Ajele Fire Station in Lagos Island. Chief (Mrs). Taiwo Taiwo, the president of LIMGE, at the occasion, witnessed by many eminent persons, said

the initiative was to make sure "that no building on Lagos Island is ever gutted by fire again". "This was one of our clear mandates from inception because we are aware of the fact that the Lagos Island area is densely populated with close clusters and has always been prone to fire incidents even from colonial times. "What LIMGE is doing is showing an example of private public partnership

for others to see and get involved in their communities so we can build a better Lagos and Nigeria," she said. According to her, the project, which will be officially commissioned in June, boasts of a gym, recreational room, communication equipment, training facilities, four state-of-the-art fire fighting motorbikes, brand new fire fighting kits and top quality modern fire fighting. The LIMGE boss explained that 100 specially selected firemen have attended a comprehensive and extensive two weeks training facilitated by a fire chief from the New Jersey Fire Department. "Our new target is to make a-state-of-art fully equipped and functional fire station dedicated to business district and accessible 24hrs and well trained fully kitted firemen to be ready at all hours," she added.

Community

2013 July, SweetcrudeReports

An oil worker

LAND OCCUPATION:

Community drags oil firm, Army to court

n o i l company, Newcross Petroleum Limited, has been dragged to court alongside the Nigerian Army for alleged illegal occupation of land belonging to Obagie N’unuamen community in Orhionmwon Local Government Area of Edo State. Obagie N’unuamen, an oil producing community, is alleging the use of personnel of the Army by the oil company to deprive them of their land and the accruing benefits. In the suit filed at the Federal High Court in Benin, the community is asking the court to restrain the Chief of Army Staff, the Commander of the 4 Mechanised Brigade of the Nigerian Army, the management of Newcross Petroleum Limited, and their agents and privies from entering, working upon and

carrying out oil prospecting or oil mining activities on any portion of its land. Related to this, the President General of the community, Mr. Femi Aiwansedo, has denied the allegation by the Newcross that it had convened a meeting attended by the host

communities, including N’unuaemn. Aiwansedo said the claim by the oil company was untrue and an attempt to discredit the community. Citing the case in court, he advised the company against use of the Army to molest, intimidate, and deny

the people of their rights and benefits as an oil producing area. The community is also demanding N100 million as damages against Newcross Petroleum Limited for the loss of value to the land as a result of interference with the plaintiff’s interest in the

20 hectares of land belonging to the community and another 38 hectares of its land, which the company entered into without their permission and in the process, carried out oil exploration activities and subsequently laid the land to waste.

Uduaghan says oil firms now returning to Warri G overnor Emmanuel Uduaghan of Delta State says some oil companies which fled the oil city of Warri over security and uncooperative attitude of youths, some years back, had begun

returning to the state. Uduaghan disclosed this while inspecting road and school projects under construction by his government. The governor urged the people to maintain the new found peace, noting that the companies were coming back with new

names. "We should not disturb them; we should cooperate with them and help government in its efforts to create employment opportunities for our people," he said. The governor said he was not disturbed when the oil

companies left the city because they did not leave with the oil. "I will be meeting with some of the companies soon and on Delta Steel Company, DSC, Ovwian-Aladja, we are working with the Federal Government to see that the place is re-opened," Uduaghan said.

Community

2013 July, SweetcrudeReports

NigerDelta

Question

JOHN IYENE OWUBOKIRI

Governor Amaechi, tyranny & the man in the mirror

he Governors of the Niger Delta viewed together, read like a collage of eclectic personalities stuck together on a platform by an artist whose beans have gone sour. In the nearest future, I promise to do an expose of the lot but Governor Amaechi’s sabre rattling and recent activism for democracy makes him a first among equals to grace this page. A man with an arrested intellect famous in the land for conceiving of a monorail project worth billions but without target passengers, he became speaker of the Rivers State House of Assembly directly from the cubby hole of a clerk’s office at Dr. Peter Odili’s Pamo Clinic on Aba Road, Port Harcourt. At a dinner organised by my friend at the Shell Residential Area in Port Harcourt in 1999, I came face to face with the gangly Speaker – to – be, faded flannels, a disused coat and the coarsest boots in the land! I was happy for him and for the state as I mused within me that many such unknown quantities had saved if not raised their homelands. And for me, he had as much right as the sons of the elitist families of Rivers State, to aspire to an office as high as the Speakership of the House of Assembly. Forget for now that one man Uche Okwukwu was crying aloud that he had been the winner of the Assembly election at Amaechi’s Constituency. As falcon he carried out the duties of the falconer, Dr. Peter Odili with diligence, manipulating the House to grant parliamentary approval to the former governor’s rascality with the commonwealth of Rivers State. Forget again that he diligently documented the rascalities and passed them on to the EFCC when Dr. Odili started supporting Celestine Omehia to succeed him. This man who became governor of Rivers State without participating in an election, without campaigning, without voting or being voted for and without a known manifesto but through the magnanimity of a retired Supreme Court, has neither respect nor a pretended knowledge of law. In several cases, his contractors were ordered to move unto sites despite valid restraining orders from the courts. He disrespected the elders of the state, abusing the folk he led, never failing to remind them that they did not make him governor. Governor Amaechi the peasant developed a god-like mien months into his rule and governed the state like a patch of real estate left to him by a childless relative.

Marine Pollution

NNPC tackles environmental degradation

he Nigerian N a t i o n a l Petroleum Corporation, NNPC, says it is committed to protecting and saving the environment. It has, therefore, tasked its staff to imbibe selfconsciousness and the spirit of preservation and friendliness to the environment as a way of preventing environmental

degradation. The corporation used the opportunity of the recent World Environment Day to sensitise its workers on the importance of preserving the environment. Mr. James Adebola, Manager, NNPC Lagos Zone office, who spoke to newsmen in Lagos, said the corporation observed the World Environment Day every year so as to educate its members

on the need to protect and save the environment. Said Adebola: "As you are aware, every June 5 is World Environmental Day and NNPC year in year out has always been observing it in order to sensitize our members on the need for them to be aware to protect, save the environment and ensure that it is not abused.”

About three months ago I represented an Okrika/Ijaw community on whose land, government wanted to develop a Golf Estate. The government rep started the meeting by telling us that the developers were open to dealing with contractors from the communities. When asked about the important issue of compensation that was a universal phenomenon all over the state, she first produced a 1963 map drawn by the Eastern Regional government and openly threatened the people that if they talked about compensation, government would drive them from patches that they had encroached upon by virtue of the 1963 acquisition. She stated secondly that an Ikwerre community had been awarded all the land now required for the Golf Estate and that the land actually belonged to that community. Note that government did not pay that community compensation. Note also that reps of that community were not even invited for the parley. The Lady finally looked in our faces and told us that the Governor has decided that there would be no compensation in this case. For me, this was the defining point of impunity; the machinations of a tyrant who could sink low enough to threaten and blackmail a constituency under his trust. I told my fellow delegates it was time to leave and to the lady I said these words I had picked up from a Cameron film: “The days for honouring yourselves would soon be at an end.” It was a month later, lying leisurely in the warm ambience of my Houston hotel room that I learnt with immeasurable glee of the travails of the tyrant of Rivers State. “Shoot me if you want” Amaechi says to the CP, Rivers, the newspapers reported. Suffering limited perceptibility and lacking in intellect, Amaechi would not realise this is the language of the falling and fallen tyrant. Col. Gaddhafi, the former tyrant of Tripoli asked his tormentors: “Do you have any knowledge of good and evil?” The moral to be drawn from the overthrow of Egyptian President Morsi is that though the ballot regulates democratic practices, people should not and do not have to endure a tyrant even months into his rule. Again, as the Egyptians of Tahrir Square have shown us, Protest against a tyrant is a more eloquent vote of No Confidence than any impeachment process by politicians. Why do the Rivers people have to wait till 2015 to send off this tyrant from their most hallowed piece of real estate? It is so funny to hear Governor Amaechi talk of tyranny as he may never know that the representation of that word is the Man in his mirror!

2013 July, SweetcrudeReports