SweetCrude May 2013 by Sweetcrude reports

Labour

Eluonye KOYEGWAEHI

ORKERS i n Nigeria’s Oil and G a s industry have raised alarm that no new investment has taken place in the Petroleum industry in the last five years because of non-passage of the Petroleum Industry, Bill, PIB, warning that Nigeria stands the risk of losing out as there are new oil discoveries all over Africa that are drawing in investors. The workers under the aegis of the National Union of Petroleum and Natural Gas Workers, NUPENG, and its Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, counterpart, said Nigeria cannot afford the luxury of time while politicians indulge in unnecessary bickering over such an important bill on a sector that accounts for over 90 per cent of the nation’s foreign exchange earnings among others things. At a joint briefing under the u m b r e l l a o f NUPENGASSAN, a fusion of N U P E N G a n d PENGASSAN, the two bodies said PIB represented a great opportunity for Nigeria to ensure a solid foundation on which the future of oil and gas operations in the country would rest. Speaking on behalf of NUPENGASSAN, President of PENGASSAN, Comrade Babatunde Ogun, recalled that the latest PIB was presented to the National Assembly first in July 2012, lamenting that from then till now, almost one year after, not much had been done by the lawmakers. According to him, “the bill was recently referred to adhoc committees after passing the second reading stage in both houses of the National Assembly. Even the Senate is yet to inaugurate its adhoc committee on the PIB while the House of Representatives’ ad-hoc committee is still making preparations for public hearing. Meanwhile, investors have continued to adopt a wait and see

2013 May, SweetcrudeReports

Oil workers lament lull in petroleum industry over PIB

An oil worker

We believe that the PIB represents a great opportunity for Nigeria to ensure a solid foundation on which the future of oil and gas operations in the country will rest attitude, refraining from making any new investment pending the passage of the bill. Since 2009 when the Yar’Adua government first introduced the PIB, no new Final Investment Decision (FID) has been taken on any oil and gas project in Nigeria, not even on the government-promoted, Brass LNG project.” “While we are dithering in Nigeria, there are new oil

discoveries all over Africa, drawing in investors just as new technology is making hitherto unreachable and uneconomic hydrocarbon deposits accessible in Europe and North America, thus attracting investors to those environments. Nigeria therefore cannot afford the luxury of time while politicians indulge in unnecessary bickering over

such an important bill on a sector that is the main stay of our economy accounting for over 90 per cent of our foreign exchange earnings, about 40 per cent of the Gross Domestic Products (GDP) and 80per cent of government revenue.” He said “We believe that the PIB represents a great opportunity for Nigeria to ensure a solid foundation on which the future of oil and gas operations in the country will rest. Also, that the petroleum resource which Nigeria have been endowed, work for the benefits of the Nigerian people. As critical stakeholders, NUPENG and PENGASSAN demand that the National Assembly expedite action on the passage of the bill. We can no longer wait. We believe that the objectives of the PIB and Nigeria’s national interest are best secured through transparency and

accountability, fiscal terms, institutional framework especially the role of the Minister, National Oil Company, NOC, Petroleum Host Community Fund, PHCF, and regulator; refinery and other Downstream Activities and Labour Issues and membership of Institutions, Boards and Committee.” “One of the major areas of grave concern about Nigeria’s petroleum industry has been the opaque nature of the industry. Many processes and activities are shrouded in mystery that controversies usually arise even amongst government agencies on matters such as the country’s daily production or revenue arising there from. We have also had occasions when Nigerian Presidents and their Petroleum Ministers award lucrative oil blocks to themselves or their cronies.

2013 May, SweetcrudeReports

Labour

Comrade Igwe Achese stressing a point

NUPENG expresses concern over force majeure by oil majors …says Nigeria degenerating into a jungle

Eluonye KOYEGWAEHI

ATIONAL Union of Petroleum and Natural G a s Workers, NUPENG, has expressed concern over the worsening security situation in the country, lamenting incessant force majeure being declared by major oil companies in the country, is unhealthy for Nigeria’s socioeconomic growth and stability. The union called on the Federal Government to safeguard the lives and property of its citizens by putting a halt to the wanton loss of innocent lives occasioned by terrorists insurgency and among others, arguing that these killings have not only dented

the image of the country abroad, also, scaring foreign investors from Nigeria. NUPENG in a statement by its President, Comrade Igwe Achese, said “Nigeria Union of Petroleum and Natural Gas Workers (NUPENG), is worried about the incessant force majeure been declared by oil majors, especially Shell Petroleum Development Company and recently by Agip Oil Company in its oil fields in the Niger Delta due to illegal bunkering. The union read with consternation the shutting down of Italian Oil Firm, Agip swamp area oil fields in Bayelsa which produces about 40,000 barrels of crude oil daily due to incessant wave of illegal bunkering and pipelines vandalism. The union adds that it is sad that Agip Oil Company was losing about

The union called on the Federal Government to safeguard the lives and property of its citizens by putting a halt to the wanton loss of innocent lives occasioned by terrorists insurgency 7,000 barrels of its crude production daily to oil thieves in Bayelsa State. NUPENG condemns the act of illegal bunkering and theft of crude oil as it is robbing the nation of the needed foreign exchange that should be used for developmental

purposes.” “The union re-iterates that theft of the nation’s resources, like crude oil is unpatriotic, criminal and further degrades the environment, as they often leave the crude to spill into farmlands and waters. It

has been discovered that the destruction of the ecosystem in the Niger Delta region is as a result of wanton theft through bursting of oil pipelines. The union vehemently condemns the illegal bunkering activities which have led to loss of colossal monies that should have gone into the federation account. The union calls on the federal government to overhaul the Joint Task Force operations (JTF), in its fight to check illegal bunkerers through a change of tactics. The traditional method of chasing and destroying the stolen products has not reduced their activities, with the numerous pipelines that traverse the nooks and crannies of the Niger Delta region.” According to Achese, “the union calls for effective surveillance and use of the locals to monitor the pipelines. The union also wants the federal government and the International oil companies to engage modern day technology in monitoring areas where pipelines are tampered with and respond fast before any damage is done to the environment. The union appeals to the federal government to address the nagging problem of unemployment in the country, which is the major cause of their nefarious activities. It notes that for many years, the pipelines were there and nobody tampered with them, but, when we began to have an army of educated people without jobs, they turned to illegal activities.” “Apart from tackling unemployment, the union wants the government to open up the region with good roads, bring in modern infrastructures to make the people have a sense of belonging, that they are not just been exploited, with noting to show for the oil that is on their soil. The union calls on the federal government to engage the public private partnership scheme to establish factories, cottage industries that will keep the restive youths busy. It also adds that empowerment scheme should be launched and promoted by the oil multinationals and states governments to make some of them go into selfemployment.

Labour

2013 May, SweetcrudeReports

NUPENG, PENGASSAN set up PIB Committee on workers’ views, others

Eluonye KOYEGWAEHI

HE umbrella bodies for workers in Nigeria’s petroleum sector; National Union of Petroleum and Natural Gas Workers, NUPENG, and the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, have set up a joint Petroleum Industry Bill, PIB, committee to protect the interest of workers, push through the views the workers among others. Disclosing this, President of PENGASSAN, Comrade Babatunde Ogun, said before PIB bill was forwarded to the National Assembly, NUPENG and PENGASSAN had set up their separate PIB committees According to him “during the Joint National Executive Council, NEC, meeting of NUPENG and PENGASSAN in November 2012 in Calabar, these separate PIB Committees of NUPENG and PENGASSAN were consolidated into one body known as ‘NUPENG and PENGASSAN Joint Committee on the Petroleum Industry Bill’. The NUPENG and PENGASSAN Joint Committee on PIB together with the leadership of NUPENG and PENGASSAN have met with the Nigeria National Petroleum Corporation, NNPC, and the producing companies, organised an engagement session with all stakeholders to collate views and even had the benefit of working with consultants. We have done our work and we implore you to partner with us in propagating these proposals for the benefit of all Nigerians. Now it is time for the National Assembly to do its own work. Nigeria and Nigerians can no longer wait. Ogun said labour was the most critical factor in the production process as such the PIB must make provisions that recognize and uphold the interest and welfare of workers, saying “the PIB must accommodate

Oil workers

the following minimum requirements with regards to labour issues to garner NUPENGASSAN’s full support; ensure the mandatory recognition of the right to freedom of association and effective collective bargaining by all companies operating or doing business in the Nigeria oil and gas industry irrespective of where they are located, ensure that all companies operating in the Nigerian oil and Gas industry comply with all international labour conventions that have been ratified by Nigeria; the collective agreements with the labour unions and the extant labour laws as a minimum in all their dealings with the Nigerian workers and their representatives, ensure all workers in the NNPC and all other government agencies to be impacted by the PIB shall transit to the new companies/agencies on terms and conditions no less favourable than their present conditions. This is crucial to the successful takeoff of these agencies, the NOC and the PIB itself.

The PIB must also “ensure proper arrangements be made that the liabilities of the NNPC and other agencies to their staff such as pensions to retired and existing employees are adequately provided for prior to the effective commencement date of the PIB and ensure that companies operating in the oil and gas industry do not use the PIB as a ploy to disengage Nigerians. To this end, the PIB should give the

regulatory agencies the power to protect the jobs of Nigerians working in the oil and gas industry such that no Nigerian will be relieved of his/her job without the approval in writing of the regulator. It should ensure all workers in the oil industry to be impacted by the PIB shall not be asked to leave service until a minimum of five years after transition.” “In addition after five

The PIB must ensure strengthening of the Nigerian Content Act and policies, especially as it relates to labour, training and manpower development

years, the Union must be involved in re-organization/ right-sizing cum negotiation of exiting staff. The PIB must ensure strengthening of the Nigerian Content Act and policies, especially as relates to labour, training and manpower development. A severance Fund should be set with NUPENG and PENGASSAN being part of the fund managers in the event of job losses which might arise at the onset of the PIB implementation. You will recall during the banking reforms process that government, especially the Minister of Finance and CBN governor said emphatically that jobs won’t be loss. But after the reform, the earlier assurances evaporated.” With respect to the membership of boards created under the PIB, provision must be made for representation of one person each of PENGASSAN and NUPENG in all the boards and committees set up in the PIB.

Labour

2013 May, SweetcrudeReports

Eluonye KOYEGWAEHI

he Federal Government says it will by June this year register the ratified Maritime Labour Convention 2006 in Geneva, in realisation of the designation of Nigeria as an exemplary maritime nation. Permanent Secretary in the Federal Ministry of Labour and Productivity, Dr. Clement Illoh, dropped the hints when a delegation of the International Labour Organisation, ILO, led by its Country Director in Nigeria, Mrs. Chuma Mkandawire, visited the Ministry in Abuja. Illoh, who spoke of government's commitment to the registration of the ratified Convention, said: "The Maritime Labour Convention 2006 is a convention that is very dear to us because it has to do with our seafarers and Maritime workers. "The Maritime sector will be a beehive of activities in view of the discovery of oil and gas in the sub-region. The earlier we push ahead to ratify this convention the better for all of us. Our work plan is to register the instrument in Geneva by June in realisation of the designation of Nigeria as an exemplary Maritime Country". Appreciating the show of solidarity of ILO team in visiting the Ministry, Illoh, who was recently deployed to the Labour and Productivity Ministry as Permanent Secretary, said he saw his deployment as a challenge to contribute his quota to the development of the Ministry and the realisation of the Transformation Agenda of President Goodluck Jonathan. "My appointment as a Permanent Secretary and deployment to the Ministry of Labour to me is kind of divine providence; I have a mission to achieve in this Ministry. I want to make some positive impact in spite of the challenge," he asserted. Illoh called on the ILO and stakeholders in the labour sector to assist in mobilising support for the passage of the Labour Bills, which had been in the National Assembly for years now, arguing that the passage of the Bills would help in addressing most of the developmental issues in the labour sector, and create the enabling environment for industrial harmony and job creation. Mrs. Mkandawiren, in her

Ship on the sea

Govt to register ratified Maritime Labour Convention 2006 The International Labour Organisation in Geneva has recommended the review of the policy on HIV/AIDS to align with Recommendation 200 of ILO, in this regards our expert will be working with the Ministry speech, disclosed plans by the international organisation to work with the Ministry of Labour and Productivity, towards reviewing the Policy on HIV/AIDS in Nigeria in line with Recommendation 200, aimed at preventing mother to child transmission. According to her, "the International Labour Organisation in Geneva has recommended the review of the policy on HIV/AIDS to align with Recommendation

200 of ILO, in this regards our expert will be working with the Ministry. The focus on HIV/AIDS especially in Nigeria and other Africa countries is the prevention of mother to child transmission, at ILO we believe that mothers are not only in the house as there are working mothers, we like to see how the policy can address the issue as it affects working mothers". Continuing, the ILO Country Director commended the support of the Ministry, under the leadership of the Minister of Labour and Productivity, Chief Emeka Wogu, in terms of the Ministry's involvements in mutually beneficial projects to the country and the United Nations. "I want to thank the Ministry officials for their support and leadership in terms of involvement in

projects that are of benefit to both the Country and United Nations, major among which is the Flood Disaster Need Assessment. I am very proud to say that the Ministry played a crucial role and the report is now ready and has been submitted to the United Nations for onward submission to the Federal Government of Nigeria," she said. Mkandawire sought areas of further collaboration that would enhance not only the Ministry's social and economic mandate, but also in terms of programmes that were of mutual benefits to the Organisation and the Ministry, adding that the appointment of Dr. Illoh as Permanent Secretary in the Ministry was a step in the right direction in view of his expert knowledge of the Ministry.

Labour

2013 May, SweetcrudeReports

Labour threatens banks over unfair practices

Banking hall

Eluonye KOYEGWAEHI

ATIONAL Union of B a n k s , Insurance a n d Financial Institutions Employees, NUBIFIE, says it has perfected plans to take on banks and other financial institutions that have developed penchant for unfair policies and practices, especially refusal to allow union and retrenchment without recourse to subsisting procedural agreement and labour laws and standards. NUBIFIE named Union Bank of Nigeria, UBN, Plc Ecobank Plc, First Bank of

Nigeria, FBN, Plc, among others, as well as insurance companies and other financial institutions as failing in this regard, saying it would confront them should they fail to jettison their perceived unfair labour practices. At a briefing in Lagos, President of the union, Danjuma Musa, lamented that the union had for some times been having a number of challenges confronting it. He noted that “some of the challenges were direct government policy induced consequences, while others were cumulative effects of inefficient supervision by regulatory authorities thus, encouraging or creating enabling environment for corporate mis-governance and

All other banks and insurance companies are advised in their own interest not to embark on any form of policy that would involve loss of jobs without recourse to collective agreement or consultation with the Union other In specific terms, denial of workers their rights to freedom of association and to unionism, continuous arbitrary retrenchment of workers without recourse to collective agreement and

consultation with the union, deliberate subversion of reconstitution of the Joint Negotiation Council, JNC, by withholding support to Nigeria Employers Association of Banks, Insurance and Allied

Institution (NEABIAI) an umbrella organization for Employers in the Industry, exerting undue pressure on workers’ to meet-up with unrealistic deposit drive target, in the process and in some cases rendering or exposing workers to abuse and dehumanization with the attendant psychological trauma, have all become the hallmark of management practices in trying to achieve their corporate goals.” Musa further lamented: “The understanding the union has always displayed in the face of these challenges and more, has unfortunately emboldened various management to embark on various forms of unpopular policies against workers, on erroneous assumption that the union could not do anything in the face of the provocations. “ This is quite regrettable and, nothing could be further from the truth than this assumption. If the union’s demonstration of understanding and maturity has been taken for granted by management the union is serving notice to management that the union is unequivocally committed to defend the rights of workers. “In this regard, the wish to serve notice all managements but in particular the following the managements; Union Bank Plc, Eco Bank, Plc, First Bank of Nigeria, Plc, to stop any further retrenchment of workers in the guise of performance appraisal scheme, which is considered as defective and subjective by the Union. “Review, in consultation with the Union the cases of those workers that lost their jobs under the scheme. Stop forthwith any further sack of workers under the guise of performance appraisal.” He added that all affected banks should review the cases of those already retrenched under the policy, in consultation with the union. All other banks and insurance companies are advised in their own interest not to embark on any form of policy that would involve loss of jobs without recourse to collective agreement or consultation with the Union, failing which appropriate action would be taken against them.

Solid Mineral

2013 May, SweetcrudeReports

Illegal miners

Govt moves to curb the activities of illegal miners

OSCARLINE ONWUEMENYI yesterday in Abuja said that the he Federal Government has vowed to curtail illegal m i n i n g activities around the country in order to ensure more revenue accruing from the sector as well as enhance the position of solid minerals mining in the country. To this extent, the Ministry of Mines and Steel Development has procured and distributed six surveillance vehicles to enhance the monitoring activities of mines officers at different mines sites across the country. The Minister of Mines and Steel Development, Arc. Musa Mohammed Sada who commissioned the six surveillance vehicles

Landrover vehicles which were purchased at the rate of 8.5 million naira each can access mines sites which other vehicles cannot get into. Arc. Sada said, “The purpose of the vehicles was the fact that they were the standard mining vehicles anywhere in the world, and there was the need to have one in each state of the federation to ensure proper monitoring.” He noted that one of the problems hindering the regulatory operation in the minerals and metals sector was the inability of mines officers to get into the far and remote areas where illegal mining operations are prevalent, adding that “if we are able to get any fund intervention from the government, we will be able to buy a large number of vehicles so that every state of the

Illegal miners are in trouble and the presentation of the vehicles would go a long way at promoting operational activities at the sites, increasing revenue generation while the monitoring of explosive storage facilities will also be enhanced federation can have one.” While fielding questions from newsmen, the Minister assured that proper maintenance of the vehicles had already been put in place with the maintenance agreement reached with the company that supplied those

vehicles. While presenting the bunch of keys to the surveillance vehicles to the Southwest Zonal Mines Coordinator, Engr. Emmanuel Alagada on behalf of other beneficiaries, the Permanent Secretary in

the Ministry, Mr.Linus Awute said the Ministry appreciated the herculean task faced by Mines officers in reaching the mines sites in order for them to carry out the monitoring of mining activities. The Permanent Secretary said efforts of the ministry are in top gear in proffering solutions to those militating problems facing the mining operations in t h e c o u n t r y . He added that this gesture was aimed at increasing the revenue accruable to government from the mining operations, enhancing the regulatory functions of the government as well as reducing the rate of illegal mining operations in the country. He expressed optimism that more surveillance vehicles were coming and that the ministry was being properly positioned t o w a r d s t h e diversification of the economy of Nigeria. The South West Zonal Mines Coordinator, Engr. Emmanuel Alagada who received the bunch of keys to the vehicles on behalf of other beneficiaries thanked the government for the kind gesture. He said that illegal miners are in trouble and the presentation of the vehicles would go a long way at promoting operational activities at the sites, increasing revenue generation while the monitoring of explosive storage facilities will also be enhanced. The first batch of mines surveillance vehicles were distributed to Zamfara and Ogun States and Federal Capital Territory, Abuja.

2013 May, SweetcrudeReports

Solid Mineral

Solid minerals industry charts way forward

Local miners tunnel

ith the recent launch of the Road Map for the Development of solid minerals and metals sector document by the Minister of M i n e s a n d S t e e l Development, Arc. Musa Mohammed Sada, all seems set for an upward trajectory for the sector which has hitherto played second fiddle to oil and gas as a major source of revenue and contributor to growth of the national economy. The launch came barely a year after the minister presented the Mining Regulations document and commissioned the new headquarters of the Mining Cadastre Office, which is considered the major administrative hub for mining operations in the

country. Indeed, the flurry of activities within the sector may smack of an attempt to impress, but there is no doubt that these events would mark the beginning of a long process to overhaul the sector and place the country among the elite mining countries in the world. According to government officials, the desire for diversification of the national

economy away from overdependence on oil and gas as the principal revenue sources gave rise to the evolution of the Road map, with a view to transforming the minerals and metals sector into a catalyst for growth. Some of the targets of the Road map include increasing the sector’s contribution to the nation’s

Some of the targets of the Road map include increasing the sector’s contribution to the nation’s GDP from the current 0.4 per cent to at least 5 per cent in the next couple of years and 10 per cent by 2020

GDP from the current 0.4 per cent to at least 5 per cent in the next couple of years and 10 per cent by 2020. It also aims to create about 3 million direct and indirect jobs by the year 2015 by facilitating the production of coal needed to fire coalfired power plants that are expected to contribute about 30 per cent of the nation’s power generation by 2020. Other targets are to revitalize the entire steel sector for the operation and production of 3 million tons of liquid steel per annum by 2015 and 12.2 million tons of liquid steel per annum by 2020. Also, if implemented faithfully, the nation may hope to become a regional and global producer of aluminium and steel products with a target of 100,000 tonnes per year of primary aluminium and 3 million tons per year of steel

products by the year 2015. It also aims to achieve enhanced capacity to supply 50 per cent of the skilled manpower required for all segments of the minerals and metals sector, as well as produce geological maps on a scale of 1:100,000 covering the entire nation by the year 2020. By the launch of the document in Abuja the Federal Government seemed to have signalled its determination to chart a veritable course for the growth and expansion of minerals and mining activities in the country may have removed all the encumbrances militating against investment in the mining sector with the unveiling and public presentation of the 2011 mining regulations document. In the words of the Minister of Mines and Steel Development, the Road map would streamline activities in the mining sector. Furthermore, Sada noted that stakeholders within the industry need not blame the banks and investors who had been reluctant to offer credit facilities to investors, explaining that the absence of clear guidelines which would coordinate activities in the industry was until now, lacking. “All our efforts to reform the sector including the launch of this document and the introduction of new mining regulations are to ensure that indiscriminate decisions do not exist. The Road map and the regulation document are both requirements if the sector must move forward with boldness. Thus, you cannot blame investors and banks for developing cold feet because the rules of the games are not clear,” he said. He added that the unveiling of the document would restore confidence in the mining sector, adding that the issues of illegal mining were largely due to absence of the mining Road map which explains what to do. Sada further explained that although the country had the Minerals and Metal Act since 2007, there was no i n s t r u m e n t o f implementation. “We have realised that the regulation was one of the things the investors were clamouring for,” he noted.

2013 May, SweetcrudeReports

Solid Mineral

Oscarline ONWUEMENYI

he World Bank has declared as satisfactory the implementation of about $120 million Sustainable Management of Mineral Resources Project for the revitalization of Nigeria’s minerals and metal sector. The Bank, with all it's meticulous vetting and assessment of its programmes and projects in developing countries, unabashedly praised Nigeria's shot at a mining renaissance three decades after the demise of the sector. But, the commendation was largely anchored on what the bank regards as the prudent and judicious use of a $120 million grant it had extended to Nigeria as an incentive to resuscitating Nigeria's solid minerals sector. The grant, known as the Sustainable Management of Mineral Resource Project (SMMRP), is a home-grown intervention which was conceptualized after a National mining Policy dialogue in 2004. It became effective in April 2005 and was implemented through a seven-year period with an original closing date of June 2010. But the World bank granted an extension as compensation for some implementation delays which occurred earlier in the life of the project. The $120m credit which has a 30-year repayment term with a 0.75 percent commission was taken as part of government’s emphasis on developing the non-oil sector to diversify the economy. It also conforms to the World Bank Group 2004 Joint Interim Strategy for Nigeria which was aimed at improving economic governance, creation of conditions for rapid private sector-led poverty reducing growth and enablement of local communities to take charge of their own development. However, according to the agreement, the Federal government is expected to put in $7 million as counterpart funding, which sadly, till date, it has not. In a document entitled: “Implementation, Completion and Results Report”, the global bank noted that in all the 15 financial and procurement

Mine site

World Bank appraises Nigeria’s application of $120m mining credit The bank observed that the SMMRP has strengthened the capacity of key government institutions to better manage the sector. It has also improved governance and transparency which is largely responsible for the commendable inflow of foreign investments into the sector audits conducted between the inception of the project in 2005 and its conclusion in May 2012, the SMMRP was satisfactory in all except the audit conducted in March 2007, in which it was rated moderately satisfactory. The document jointly signed by the Vice President of the World Bank, Muktar Diop, Nigerian Country Director, Marie Nelie, Sector Manager, Christopher Sheldon, Project Team Leader, Ekaterina Mikhaylova, and the Primary Author, Sabine Cornelius,

defended the overall satisfactory rating of the Federal Government’s Project Management Unit (PMU) which handled the project, noting that, “Despite the multiple disruptions and considerable constraints, the Project continued to function well.” It further revealed that in the financial management of the credit, all audits were unqualified and cases of fraud were uncovered,

adding that during implementation of the procurement, two-thirds of project’s procurement performance ratings were mostly satisfactory. The report commended the Federal Government for taking over the funding responsibility of SMMRPsupported projects such as the Mining Cadastre Office and the Nigerian Institute of Mining and Geosciences, NIMG, Jos. The Project which was flagged off in April 2005 had two main objectives, namely to increase government’s long-term institutional and technical capacity to manage Nigeria’s mineral resources in a sustainable way, and to establish a basis for poverty reduction and rural economic renewal in selected areas of the country through the development of income generating opportunities through small-scale and artisanal mining and diversifying

away from oil sources of income. According to the report, the project achieved improved g o v e r n a n c e a n d transparency outcomes in the well-performing state-ofthe-art cadastre system, efficient management of mining licenses, strengthened institutional and technical capacity, legal and regulatory framework as well as private sector-led development, increased mining activities and increased annual royalty collection value among others. The bank observed that the SMMRP has strengthened the capacity of key government institutions to better manage the sector. It has also improved g o v e r n a n c e a n d transparency which is largely responsible for the commendable inflow of foreign investments into the sector.

2013 May, SweetcrudeReports

Solid Mineral

Nigeria to produce 12m tonnes of liquid steel by 2020

r e s i d e n t G o o d l u c k Jonathan, Thursday, said the Federal Government has worked out an industrial blue-print that will see to the complete development of the nation’s iron and steel industry. This, he said will serve as a catalyst for the industrial development of the country. Jonathan, who spoke at the commissioning the 700,000 tonnes 5-Stand Tandem Cold Rolled Steel Plant, built by Wempco Steel Mill Limited at Ibafon, Ogun State, said the country would be producing about 12 million tonnes of liquid steel by 2020. According to him, steel was one of the most important materials used widely for both domestic and industrial purposes throughout the world, and that was why the government planned to develop the complete ecosystem of this sub-sector. He disclosed that his “administration has approved the Minerals and Metals Development Road Map, which was recently presented to the public stipulating time-bound targets for the sector,” and pointed out that the strategies to be adopted would see to the accomplishment of the set objectives of increasing steel production of three million tonnes of liquid steel by the end of this year and progressively increase to 12 million tonnes by 2020. He described the new steel plant as the single largest private sector investment in the steel sector, and a another milestone in “our determination to reposition our steel sector to play a pivotal role in our match towards industrialisation a n d n a t i o n a l transformation.” He commended the management of WEMPCO for its efforts in building the plant. “By constructing this 700,000 metric tonnes per annum cold rolled steel here to compliment your existing investments in the country, Wempco has demonstrated strong belief and confidence in our economy. I thank you for keeping faith in our country. “Steel is at the heart of any national economic development endeavour. As we all know, a vibrant steel

Liquid steel

sector contributes to GDP growth, facilitates exploitation of natural resources and generates economic activities in downstream industries,” the president said. He continued: “It also

promotes job creation, the acquisition of technical skills, transfer of technology and the provision of machine parts and tools. In fact, no nation can industrialise without a vibrant iron and

steel sector. “With increasing globalisation and the growing strategic importance of Nigeria as a key emerging market, we are determined to provide

the necessary incentives and support for the growth of the private sector. The steel sector offers immense economic opportunities for our country, which we have not fully exploited.

Ajaokuta Steel Company will resume production soon –Minister

he Minister of Mines and S t e e l Development, Alhaji Mohammed Sada, said that the Ajaokuta Steel Company would s o o n r e s u m e production. The minister made this known at the Ministerial Briefing of members of the Peoples’ Democratic

Party, PDP, National Working Committee, NWC, on the ministry`s activities in Abuja On Thursday. The minister, who said he met nothing on ground when he assumed office, said that the ministry generated N60 billion as revenue through mining activities. He said that 34 mineral types existed in different locations in the country, adding that there was no

local government in the country that did not have mineral deposit. Sada further said that Nigeria had coal estimate reserves of over 2.7 billion, Iron Ore 10 billion, limestone 3 trillion tonnes and one million ounces of gold. The minister, however, said that funding was a constraint to the ministry, adding that the ministry got

only N1.6 billion out of the N2.16 billion budgeted for it in 2012. He also said that inadequate manpower, lack of adequate mining special purpose surveillance equipment for field work and revenue collection and monitoring were other challenges facing the sector. Other challenges, he said, were illegal mining activities; smuggling of minerals and lack of legal and regulatory framework for the steel sector.

2013 May, SweetcrudeReports

Freight

2013 May, SweetcrudeReports

Confusion, mixed reactions as Customs begins enforcement of TIN

Toju VINCENT

he Nigeria C u s t o m s Service, NCS, h a s commenced enforcement of the use of Tax payer Identification Number, TIN, and the Nigeria Integrated Customs Information System, NICIS, trade portal for the purpose of clearing cargoes at the port. But, the development has generated confusion and mixed reaction at the port, mostly due to the nonpreparedness of many importers who are yet to get their TIN. SweetcrudeReports gathered that many freight forwarders whose importers do not have the TIN number have had their business stalled at the port since the enforcement began, and consequently could not clear their cargo from the port. It would be recalled that the Nigeria Custom Service had also recently warned importers and issued a deadline of March 31, 2013 for those who are yet to get the TIN. Speaking with our correspondent, former chairman of the PTML chapter of the National Association of Government Approved Freight Forwarders, NAGAFF, Mr. Ugochukwu Nnadi, said that there is anxiety at the port because the new portal by the Federal Inland Revenue Service, FIRS, is not ‘accepting’ declarations and Customs is finding this difficult to deal with. Nnadi said that the situation has slowed down the pace at which cargoes are being exited from the port since the commencement of the enforcement of the TIN. “For most part of the day, the system could not access any declaration at the port,

Comptroller-General Dikko Abdullahi the FIRS portal was not opening and everybody was being asked to produce TIN,” he said of the experience on a particular day, recently. He stated that instead of placing a blanket ban on everyone who does not have

TIN, the rule should be enforced only on corporate organisations and that the Value Added Tax, VAT, should be the basis for any individual transactions. He narrated a particular experience: “A student from

abroad sent in a car and I wanted to clear it, but they are insisting that she must have TIN. She is a student abroad, how can she be forced to get TIN”. “The second incident concerns a widow whose

family in the UK was sending a car for her convenience. Where will she get TIN?” he queried. However, in his reaction, former chairman of the Tin Can Chapter of the Association of Nigerian Licensed Customs Agents, ANLCA, Mr Kayode Farinto, threw his weight behind the government on the issue of TIN registration. “You cannot use my TIN if I am not the importer. Wealthy Honey has its TIN and I have my own as an individual. Corporate organisations have theirs, and individuals have theirs. If I am not the importer, I will be stupid to use my TIN for somebody else’s cargo when I don’t even know what is inside the cargo,” he explained. Farinto said that the introduction of TIN was the best thing for the Nigerian economy despite the teething problems that are currently being experienced with it. He also said that the processing fee of N1,500 for the e-form ‘M’ is acceptable compared to what was obtainable in the processing of the manual form ‘M’.

Nigeria’s import bill drops 43% Toju VINCENT

With agency report

igeria’s import bill experienced a 43 per cent drop to $35.4 billion in the last one year, according to Renaissance Capital, RenCap. The investment and finance firm said in a report that the import bill was equivalent to 13 per cent of the national Gross Domestic

Product, GDP, for last year. The decrease in imports, according to the firm, was across all sections, as machinery and transport equipment, Nigeria’s biggest import segment, declined 63 per cent, following modest growth of two per cent in 2011. RenCap stated that the data showed a slowdown in fixed investment and growth, noting that Nigeria’s trade surplus surged 75 per cent to $105.9

billion, which is 39 per cent of GDP, based on the National Bureau of Statistics, NBS, trade data. The firm posited that the surge in trade surplus largely explains the increase in the nation’s current account surplus to 7.5 per cent of GDP in September 2012, as against 3.6 per cent in 2011. RenCap stated: “We expect revisions to the import numbers. We find it odd that while imports declined

across all categories, unspecified imports swelled 600 times to $12 billion in 2012. Unspecified imports surged from less than one per cent of total imports in preceding years to 31 per cent in 2012. “We are likely to see a significant revision of imports by categories as seen in the downward revision of the errors and omissions’ negative balance in the 2010 balance of payments.

2013 May, SweetcrudeReports

Freight

Fake recruitment agency hits NIMASA

he Nigerian Maritime Administration and Safety Agency, NIMASA, has warned the public against a web-based syndicate using its name to defraud unsuspecting Nigerians by inviting employment applications from the public to fill vacancies in the agency. “The Agency dissociates itself from the unauthorised syndicate and all internet-related activities of the group, including the payment for employment forms and processing fees”, NIMASA said in a public notice. The agency said that its recruitment exercises were always advertised in the national dailies, its in-house newsletter and website. “Any person or group of persons patronising this unauthorised syndicate do so at his or her own risk as the agency has not commissioned any persons/consultants to conduct recruitment exercise on its behalf at this time. “Members of the public are also informed that there is no organisation or agency under the Federal Ministry of Transport known as Nigerian Maritime Security Agency”, the NIMASA public notice stated.

Terrorism act

he prevailing dire security situation in Nigeria has inspired a parley in Lagos between the Nigerian Ports Authority, NPA, Security Department and the Ports Authority Police Command, PAPC, aimed at fashioning out ways to ensure adequate security for Nigerian ports, the famed gateway to the nation's economy. Executive Director, Marine and Operations, NPA, Engr. David Omonibeke, who presided over the meeting as chairman, said the authority appreciated the crucial roles of the PAPC, and will continue to cultivate, maintain and sustain a mutual working relationship with the command. Noting that without security, lives and property were at great risk, Omonibeke assured the PAPC that the NPA would continuously support the command by providing

TERRORISM SCARE:

NPA security, police close ranks to secure ports necessary logistics to enhance its operations. Omonibeke, who commended the new Commissioner of Police, PAPC, Mrs Sherifat Disu Olakoju, for her inspiring actions since assuming office, said that a remarkable change has been noticed at the ports since her coming. In his remarks, the General Manager, Security, NPA, Col. Jamil Tahir (rtd), explained that the NPA management convened the meeting to map out strategies to confront the present security challenges facing the country. Tahir asserted that, while the nation's seaports had not witnessed terrorists attack,

owing, according to him, to the vigilance of security agencies, there was need for synergy among security agencies in order to prevent any security breaches. Also speaking, the Ports Police Commissioner said that she toured the Lagos ports shortly after her assumption of duty and discovered that a lot needed to be done to improve security at the facilities. She solicited NPA's support in the areas of marine training, provision of patrol vehicles, accommodation, communication gadgets, sniffer dogs, among others. Also at the meeting from

the NPA were the General Manager, Western Ports, Ms. Adenike Sonaike; General Manager, Eastern Ports, Engr. Sunny Nwobi; Assistant General Manager, Security, Western Ports, Mr. Sam Asamage; and heads of security from the various ports. Apart from the commissioner, the PAPC team comprised the Deputy Commissioner of Police, two Assistant Commissioners of Police and all the Divisional Police Officers, DPOs, from the various ports. Industry analysts aver that the synergy between the NPA Security

Department and the PAPC may yet put lie to the assertion by the ConsularGeneral at the United States Embassy, Mr. Jeffrey Hawkins, at the justconcluded Nigeria Maritime Expo, NIMAREX, 2013, that there is no effective collaboration mechanism for the various actors in the Nigerian maritime industry at both the strategic and tactical level. Hawkins, who harped on what to him was the poor state of security of Nigeria's maritime domain, had lamented that "when players on the same team don't talk with each other, nothing productive can be accomplished."

Freight

2013 May, SweetcrudeReports

Cargo Ship

Chamber of Shipping harps on knowledge for better performance

Toju VINCENT

he Nigerian Chamber of Shipping has urged local players in the oil and gas industry to arm themselves with as much knowledge as possible so as to compete favourably with foreigners operating in Nigeria. Speaking at a four-day w o r k s h o p t i t l e ‘Understanding the Cabotage and the Local Content laws in the Nigerian Oil and Gas industry’, the Chamber’s President, Mrs. Ify Akerele Anazodo said that having a good knowledge of laws and their application to operations in the oil and gas industry will make it easy for local operators to operate

more effectively in the sector. According to her, government could ensure that jobs that were available in the industry were made more easily accessible to local companies without problems. She advised that these jobs could be done in such a way that the foreigners in the industry were not affected in any way. “Government can in subtle manner make sure that Nigerians are exposed to jobs that are available. That is how government can help, but you do not impose it. These foreigners are joint venture partners, but with the local content, you can give Nigerians the right of first refusal. “For Nigerians to do well upstream they need a lot of knowledge, patience and perseverance, we have the

A lot of activities go on in the oil and gas industry, some of these activities will require either coastal shipping or ocean bound shipping laws that are protecting us within the medium scale area, that is the local content law, it is picking up, Nigerians are beginning to manufacture things that the International Oil Companies are buying,” she said. Also speaking, the

chairman of the Onne Oil and Gas Free Zone, Dr. Chris Asoluka, said the fundamentals of the industry was currently in favour of Nigeria, adding that it would be in the interest of Nigerians to take advantage of the situation

and make the best of it. His words: “The fundamentals tend to favour us. We are a maritime nation with over 853 miles of coastal waters, a very young population, good market, and we are a great importing nation as well. “A lot of activities go on in the oil and gas industry, some of these activities will require either coastal shipping or ocean bound shipping. “The policy framework is being established, it is not perfect for now, but, I am also challenging the stakeholders to bond together so as to make their voices heard because at the policy level, there are many competing interests. The earlier you started to make your interest look important, the better for everybody”

2013 May, SweetcrudeReports

Freight

he Nationwide Group has assisted the growth of the N i g e r i a n economy with $600 million (N57 billion) in loans to operators in the maritime and oil and gas industries for the purchase of vessels for the execution of various projects. The Group's President, Mr. Ed Kostenski, in this interview with Toju Vincent says doing business in Nigerian has been very exciting Excerpts: You are involved in virtually every sector of the Nigerian economy, which part of the economy are you strongest? The people who help us to run our operations in Nigeria are our strongest asset, but, I will say that for Nigeria and Nigerian business, finance is a leading factor for strength here because we are adding growth to the country by providing interest on loans at single digit for companies to be able to grow their businesses and enterprises. I think that is the most important thing the country needs to take into the next century in a way that everybody benefits not just a few. How much has the Nationwide Group spent in assisting the growth of the Nigerian economy? We have not done too badly. We have raised over $600 million (N57 billion) in five years in fresh fund capital. We brought that much into Nigeria to invest into projects in low interest loans to the oil and gas sector, to the agricultural sector, the construction sector, hotel and tourism, aviation and maritime sectors. How involved is the Group in the maritime sector? We are involved in the maritime sector as much as we are in oil and gas. I must say we are pretty open for any opportunity in the maritime sector. We provide finances for companies that want to acquire marine vessels, tug boats, security boats barges, oil tankers, work boats and crew boats, and whatever they need to facilitate, whatever projects that they have. We will help them to get the contracts financed if the

you will grow and rise as the economy grows and rises, and you will prosper here. It is astonishing to know that we have done so well; we never dreamt that we will do so well in Nigeria. At a point the business in Nigeria was one per cent of our total revenue, but, it is five per cent of our revenue and the main reason why the Nationwide Group has prospered is because of our commitment to Nigeria and the willingness to stay in here. Like I said, it is not the easiest place, but it is a fun place to do business, the people are humorous, they are beautiful and the most thing I like about Nigerians is that they have a lot of faith and they do have faith in each other and they believe nothing is impossible. And when you have enough

Mr. Ed Kostenski

We never dreamt weâ&#x20AC;&#x2122;ll do well in Nigeria â&#x20AC;&#x201D;Nationwide Group contracts are strong enough on paper or they give us a reasonable assurance of repayment, then our Group will take a risk and make loans available for the acquisition of sea-going marine vessels. We are a very important part of the maritime sector because we are bringing money and guaranties they are not able to get anywhere else. What informed your decision to come into Nigeria, considering the risks? Well, I can answer that question in two ways. One is that we hear about Nigeria as an opportunity, but, one is afraid to come to the country because it is about nine thousand miles away from Florida, where I come. You consider the bad publicity about Nigeria, you consider the scams, you are not sure and people who come here for the first time is not sure which way is left or right. So, Nigeria can be a confusing place to an entrepreneur that is used to playing in a more structured economy, so, if he is not creative or a risk taker, and

not someone who has an open mind, he probably will not make it here in Nigeria because doing business in Nigeria is not for the faint or the weak . It is for people who understand that if you want

good people, you will be in safe hands and you learn as you go, and if you do not do a good job, people will naturally not patronise you, whether you are in China or South Africa or Hawaii. Nigeria is not a dumping

We are a very important part of the maritime sector because we are bringing monies and guaranties they were not able to get anywhere else to make it, you have to take some calculated and stupid risks. We have not lost any money so far because we check people out before we give them our monies. If you are working with

ground for junk, for people who want to make quick dollar, it will not work, but, if you have that willingness and concern for the people to provide goods and services, you will be surprised that

people agreeing to that, then nothing is impossible. Is Nigeria the only c o u n t r y w h e r e Nationwide operates in Africa? No, the Group currently operates in over 70 countries of the world in the last 30 years. Asia was a very big market for us in the 1980s, then in the 1990s we focused on the United States economy because it was very robust and strong and at the turn of the century, we started seeing some prospects in Africa, and started devoting more time and energy on the emerging markets in Africa. But, there is something about the Nigerian market. I must say that I have been to 25 countries in Africa, there is quite a difference in the Nigeria market when you compare them. To me as an American, as a person who is used to a structured economy, it is easier to do business in Nigeria than other countries in Africa.

2013 May, SweetcrudeReports

Freight

Mombasa Port

ganda is seeking to participate i n managemen t of Mombasa port and other ports in the East African Community, a senior government official has said. The Permanent Secretary Ministry of East African Community (EAC) Affairs, Edith Mwanje said Thursday that Uganda should have a say in the management of ports because of "the too many delays" at the ports, which she said affect trade. "Let us be recognized as full stakeholders in the management of ports. The ports should be managed collectively as EAC," Mwanje said at a 'validation workshop on Uganda's country position on the single Customs Territory' held in Kampala. At the workshop a draft report on "Uganda's position on the negotiation for a single Customs Territory", which was authored by Development Economist, Paul Bagabo and his colleague Lawrence Othieno was released and discussed by various stakeholders. T h e t w o w e r e commissioned by the Ministry of Finance to undertake a study and develop a position for Uganda for the negotiations

Uganda wants to run Mombasa Port for a fully-fledged Customs Union. Their report will inform Uganda's negotiating team. They study is meant to enable the High Level Task Force to develop a mechanism for engagement in the negotiations for a single

customs territory and ensure that Uganda is not disadvantaged, among others. The Single customs Territory provides for free movement of goods in the EAC partner states, nonpayment of tax of the good

that are circulating in the states and imposition of a common tax on goods coming from outside the territory, Mwanje explained. She said that apart from the issue on ports, there are still administrative barriers

and problems of corruption which should be addressed. She advised that Uganda and the partner states should watch out for goods imported into their countries and re-packaged to look as if they are made in EAC and end up evading taxes. Uganda, she said, needs a strong law to monitor such anomalies.

World Bank to audit Nigeria's Destination Inspection Scheme

he Nigerian government has contracted the World Bank to audit operation of the destination inspection scheme before handing it over to the Nigeria Customs Service, NCS. The Destination Inspection Scheme, which stipulates that all goods coming into the country must be examined at the

nation's ports, elapsed last year before it was extended for another six months. It was gathered that the government through the Minister of Finance, Ngozi Okonjo-Iweala, late last year, contracted the World Bank to audit the performance of the three Service Providers, Cotecna Destination Nigeria Limited, SGS and Global Scansystems, as well as the preparedness of the NCS to

take charge of the scheme. "FG brought in the World Bank to audit the system to see if there is need for transition or intervention; and to determine the kind of collaboration that is required," a ministry of finance official disclosed. On the widely held claims that the World Bank officials were brought in by the Customs, the official said "It was the minister that brought in the World

Bank; what the Customs did was to muscle in and you know those oyinbos (whites), they will just be smiling but what they are going to say is in their mind." It would be recalled that Ramesh Siva, who led the World Bank team after visiting many commands to assess facilities of the service, had said "Customs is ready to take over Destination Inspection Scheme.â&#x20AC;?

Motoring

2013 May, SweetcrudeReports

10 most fuel-efficient cars of 2013 T *Aaron Gold, About.com Guide

he EPA has listed the ten most fuelefficient 2013 cars on sale in America — but are they cars you would actually want to drive? This list of the ten most fuelefficient US-market cars goes beyond the numbers and tells you which ones are

worth buying and which ones are best left at the showroom. Here they are, ranked lowest-to-highest by EPA combined fuel economy. (NOTE: This list excludes electric cars and plugin hybrids, since realworld MPG varies so much.)

2 Toyota Prius C: EPA estimates: 53 MPG city/46 MPG highway/50 MPG combined Price range: $19,875 - $25,700 The Prius c (for “compact”) is the smallest and leastexpensive member of the Prius family. It’s cute outside and spacious inside, but most importantly — and just like every Toyota hybrid — it does exactly what it promises, easily exceeding 50 MPG in city driving. Its truncated hatchback shape means it’s not as aerodynamic as the regular Prius, hence the lower highway MPG figure. That said, it still beats its chief rival, the Honda Insight, and by keeping to a patience-

Toyota Prius:

sapping 60 MPH, I was able to nurse one up to 60 MPG on a flat stretch of freeway.

3 Ford C-Max Hybrid (tie): EPA estimates: 47 MPG city/47 MPG highway/47 MPG combined Price range: $25,995 - $33,710 The C-Max is a handy cross between an SUV and a wagon plucked directly from Ford’s European lineup. Ford is pitching the C-Max Hybrid as a rival to Toyota’s Prius v. It’s certainly quicker and marginally more interesting to drive, though its heavy weight and economyminded tires zap most of the handling fun of its Focus-based chassis. But it’s fuel economy that counts, and while the C-Max’s numbers are higher than the Prius v, achieving those numbers in the real world is another story — I had no problem making 46 MPG in the Toyota, but barely managed 39 MPG in the CMax.

EPA estimates: 51 MPG city/48 MPG highway/50 MPG combined Price range: $24,995 - $35,515 Here it is, Ol’ Reliable, the 800 lb gorilla of the hybrid market — and I’ll tell you what, the Prius deserves all the praise that’s been heaped upon it. The Prius has all the room a family of four will need, and it should get at least 48 MPG in mixed driving week in and week out. That’s pretty darn impressive for such a roomy family car. On the downside, the fun-todrive factor is almost nil — unless saving fuel and reducing pollution is your idea of fun, in which case you’ll have a jolly ol’ time.

Ford Fusion Hybrid (tie): EPA estimates: 47 MPG city/47 MPG highway/47 MPG combined Price range: $27,995 - $38,170 There’s a lot I like about the Ford Fusion Hybrid — heck, there’s a lot to like about every version of the new Fusion. Each and every one is beautifully styled with a high-lux interior and lots of passenger space. Ford has even managed to package the hybrid battery in the Fusion’s trunk while still leaving plenty of storage space. But as with the C-Max Hybrid, I’m skeptical about those fuel economy ratings — in a week of careful driving, I was only able to achieve 37 MPG. That’s very good for a roomy sedan, especially one that performs this well — but it’s not 47 MPG.

2013 May, SweetcrudeReports

Motoring

10 most fuel-efficient cars of 2013 4

Lincoln MKZ Hybrid: EPA estimates: 45 MPG city/45 MPG highway/45 MPG combined Price range: $36,820 - $48,555 I haven’t had the opportunity to drive the MKZ, but it’s based on the Ford Fusion, listed below, so I imagine that it drives pretty well — but I also imagine that, like the Fusion, it struggles to meet its EPA fuel economy estimates. I’ll have more to say once I’ve had a chance to drive it.

Volkswagen Jetta Hybrid: EPA estimates: 42 MPG city/48 MPG highway/45 MPG combined Price range: $25,790 - $31,795 If you’re a car nut who is dismayed that all the cars on this list are hybrids, the Jetta may well be the one bright spot on this list. Yes, it’s a hybrid, but the Jetta doesn’t drive like one — its hybrid powertrain is relatively unobtrusive, at least when you are accelerating; unfortunately the braking is pretty lousy — VW hasn’t perfected their regenerative braking system, and you never know quite what sort of response you’ll get when you step on the brake. But the Jetta, like other Volkswagens, is good fun in the curves, it has plenty of interior space, and it delivers on its promised EPA fuel economy estimates. (VW shoppers should also check out the diesel-powered Jetta TDI, known for exceeding its EPA estimates and getting 50 MPG or better on the highway.)

Toyota Prius V: EPA estimates: 44 MPG city/40 MPG highway/42 MPG combined Price range: $27,445 - $37,135 The Prius v comes straight from Toyota’s Really Good Idea Department. Essentially a Prius with a station-wagon butt grafted on, the Prius v offers the cargo capacity of a small SUV with roughly double the gas mileage. EPA fuel economy estimates are far lower than the regular Prius, but I had no trouble averaging well over 46 MPG, with numbers as high as 55 MPG in town. Remarkable. The only downside is the price: Add on a few options, and the Prius v gets seriously expensive.

Honda Civic Hybrid:

EPA estimates: 44 MPG city/44 MPG highway/44 MPG combined Price range: $25,150 - $27,850 Honda gave us an all-new Civic in 2012, and an updated version for 2013. Now, I never had much luck matching the old Civic Hybrid’s EPA fuel economy estimates; the new Civic is designed for better and easier-to-achieve MPG, and while I go closer, I still came up short — 42.1 MPG, despite gentle driving and liberal use of the “ECON” mode. I do like the Civic Hybrid for its roomy back seat and day-to-day livability; still, let’s not forget that Honda now makes the conventionally-powered Civic HF, rated at 29 MPG city/41 MPG highway. With a price tag of $20,555, it will probably save you more money in the long run than the Civic Hybrid.

2013 May, SweetcrudeReports

Motoring

10 most fuel-efficient cars of 2013 Lexus CT 200h: EPA estimates: 43 MPG city/40 MPG highway/42 MPG combined Price range: $32,945 - $39,000 The CT 200h combines the powertrain of the Prius with a small 5-door hatchback body designed for European buyers (who, by the way, are the CT’s actual target market). The CT lacks the Prius’ extreme aerodynamics, which accounts for the lower fuel economy -- but 42 MPG is easy to achieve in mixed driving, and like the Prius, the CT 200h’s fuel economy skyrockets in slow stop-and-go traffic. And the fact that it’s the least-expensive Lexus doesn’t hurt much, either. When I first saw the CT, I didn’t know what to make of it, but after spending time behind the wheel, I grew to like it — though it’s not as spacious nor as fuel-efficient as the Prius, it’s still a great mix of luxury and fuel economy.

Toyota Camry Hybrid: EPA estimates: 43 MPG city/39 MPG highway/31 MPG combined (LE), 40/38/40 (XLE) Price range: $26,810 - $34,945 The Camry Hybrid has always been a good car, but last year’s redesign has transformed it into a great car. For one thing, fuel economy estimates are way up — 41 MPG combined is pretty darn impressive for a car this size. (I haven’t had enough seat time to get a realworld figure, but in my experience, Toyota hybrids easily meet or exceed their EPA estimates.) And the interior — once a cocoon of blobby, nondescript plastic — has finally been given a little personality. One curious note: The nicer version of the Camry Hybrid, the XLE, gets worse gas mileage due to its greater weight. Other than that, there’s really not a lot to complain about.

Honda Insight Ex: EPA estimates: 41 MPG city/44 MPG highway/42 MPG combined Price range: $19,390 - $24,850 I seem to be the one of the only journalists who genuinely likes the Insight; maybe that’s because I’ve lived with one . Still, now that Toyota has introduced their own small, inexpensive hybrid, the Prius c, it is more difficult to make a case for the Honda. The Insight is still the leastexpensive hybrid, undercutting the Prius c by a scant $485, and its trunk is a bit more usable. But the Prius c has a bigger back seat, it’s built of more substantial materials, and most importantly, it gets significantly better fuel economy. Given all that, it’s hard to make a case for the Insight... but I still like it.

Technology

2013 May, SweetcrudeReports

MesoCoat offers new process for Clad pipe manufacturing

urface engineering company, MesoCoat, will this year launch large-scale commercial production of clad pipe that involves a manufacturing process that company officials say is faster, more efficient and can meet the growing demand for clad pipe in the global oil and gas industry. Euclid, Ohio-based MesoCoat, a subsidiary of Miami-based Abakan, will begin operations in September of this year at a new clad pipe manufacturing facility which will utilize its CermaClad process. MesoCoat has been recognized by The Wall Street Journal and Forbes for this cladding manufacturing process, which company officials say can meet the growing need for clad pipe as oil and gas producers pursue oil and gas reserves in highly corrosive and extreme environments. By year-end 2013, the company expects to be capable of producing more than 1.1 million square feet (100,000 square meters) of CermaClad clad pipe, plates, and other components each year.

How Cermaclad works

Cladding is a process in which a corrosionresistant alloy or composite surface layer is bonded integrally and permanently onto another dissimilar metal, or substrate, to enhance its durability or appearance. Cladding protects oil and gas pipes from heat, pressure and corrosion. Carbon steel is one of the most common substrate metals used in clad products today. Most clad products have a substrate comprised of a carbon steel structural material with aluminum, nickel, nickel

By year-end 2013, the company expects to be capable of producing more than 1.1 million square feet (100,000 square metres) of CermaClad pipe, plates, and other components each year CermaClad pipe cladding set-up for production of corrosion-resistant clad pipes

alloys, titanium, and/or stainless steel as the clad layer to protect the structural material from corrosion, while tungsten carbide, chrome carbide and/or hardness steels are used for resisting wear and erosion. The CermaClad process utilizes a superhot plasma arc lamp – essentially an artificial sun – which rapidly fuses corrosion-resistant alloys to metal surfaces at around 2,400 degrees Fahrenheit. By using the lamp, which stands 8 to 10 inches in length, alloys can be bonded on a pipe in a much wider swatch. While laser/weld cladding systems cover approximately .7 centimeters to 1 centimeter at a speed of 400 millimeters per minute, CermaClad can cover an area of around 12 to 30 centimeters, around 30 to 40 times wider at the same pace. By using an arc lamp versus laser cladding or weld overlay, which are two predominant metallurgical cladding techniques, Abakan can produce an improved corrosionresistant metal 15 to 100 times faster than the current cladding processes. MesoCoat’s primary product offering is a corrosionresistant seamless clad pipe for use as risers and flowlines in deepwater oil and gas projects, where field’s high corrosiveness requires the use of high quality corrosion-resistant pipes. The resulting product also lasts three to six times longer than traditional weld and laser technologies, which can save oil and gas companies 20 percent in lifetime costs. Additionally, these nano-enhanced products also have been shown to be safer and more ecofriendly than hard chrome coatings. MesoCoat’s clad pipe process can provide pipe for CONTINUES ON PAGE 65

Technology

2013 May, SweetcrudeReports

New process for Clad pipe manufacturing CONTINUED FROM PAGE 64 the production not only of wet and sour gas fields, but oil sands as well. The oil sand mining process involves a lot of iron ore processes, which can scour the inside of a transport vessel. This wear and tear drives up maintenance and replacement costs, and is one of the reasons that oil sands

extraction costs are high, said Robert Miller, member of Mascot’s board of directors and CEO of Abakan. The technology on which the CermaClad process is based was originally developed by the U.S. Department of Energy’s Oak Ridge National Laboratory. MesoCoat secured a research and development license for the technology in 2009 and

secured an exclusive commercial license for the technology in 2010.

Clad pipe demand to grow in O&G industry

The need for clad pipe in the oil and gas industry is expected to grow as the world’s remaining unproduced oil and gas reserves exist in highly

corrosive environments. Abakan officials say they are seeing a 10 percent per year increase for clad pipe demand. They also point to International Energy Agency estimates that over 70 percent of the world’s remaining oil and gas reserves are highly corrosive – this percentage would be higher if newfound

energy resources such as oil sands, shale and pre-salt resources were included. Of the 225 oil and gas fields now being developed across the globe, 158 are highly corrosive. The increasing remoteness of offshore oil and gas fields CONTINUES ON PAGE 66

Technology

2013 May, SweetcrudeReports

CermaClad-process

Company hopes to expand offerings to oil sand CONTINUED FROM PAGE 65 is partly drivingthe oil and gas industry’s acceptance of avoiding maintenance and liability risk by making an initial higher capital investment in clad pipe. Following the 2010 Deepwater Horizon incident, the liability for equipment failure has grown, meaning more resilient front-end engineering is required. “The more difficult is it to service and inspect a pipe makes the risk of failure higher,” said Miller. MesoCoat had initially looked the technology’s application for propulsion shafts for nuclear submarines before Abakan acquired a 71 percent

interest in MesoCoat in late 2009. MesoCoat officials switched their focus to oil and gas after learning about the industry from an Abakan board of director member; the more MesoCoat officials learned, the more it realized it had a significant market opportunity. The wait time is long for oil and gas companies to obtain clad pipe, which is only manufactured by a few companies worldwide. MesoCoat officials attribute this to the fact that the same laser and welding technologies that haven’t changed in 50 years are still being used, which makes the cladding pipe process slow. MesoCoat officials say they have also been approached by operators of fields offshore Australia who

say they have seen long lead times for ordering clad pipe.

approximately $1 billion, Miller noted.

“Even if they order it three years ahead of time, they may still not get it in time,” Miller commented.

During each year of the past decade, 1,118 miles (1,800 kilometers) of clad pipe have been laid worldwide, Miller commented. Given the highpressure, high temperature deepwater projects that oil and gas companies are pursuing, long-lasting pipe with a low risk of failure means less maintenance and lower inspection costs is a necessity. The costs associated with nickel alloys for clad products represent half the project costs for a number of field development projects. World crude steel production in 2011 was estimated at a record 1,527 million metric tons. The U.S. steel industry each

Two companies currently manufacture clad pipe, including Japan Steel Works which dominates the market with 70 percent market share. To increase capacity, manufacturers would have to increase manufacturing space. The cost of expanding an existing facility varies with the technology. A lined pipe or metallurgical clad pipe facility expansion costs anywhere in the $150 million to $300 million range, while expanding a rolling mill facility for the production of roll bonded clad plate costs

year ships over $70 billion of material. However, global costs of corrosion are exceeding $2.2 trillion each year, stronger steel products that are less susceptible to corrosion, wear and other forms of stress are needed.

Company seeks expansion overseas The company has firm plans for three cladding plants over the next few years, with options for three more, including the existing facility in Ohio, Brazil and Indonesia. This does not include acquisitions/startup of job-shop component manufacturing and repair facilities, which would bring CONTINUES ON PAGE 67

68 Community Anambra, Kogi I in oil war 2013 May, SweetcrudeReports

Chuks ISIWU

t is a typical case of the oil curse. Two neighbouring communities in Kogi and Anambra borders have taken up arms against each other on account of the new-found black gold believably trapped in the earth somewhere around the Anambra-Kogi-Enugu borders. All three states are laying claim to the golden treasure, but Anambra State have gone ahead to arrogate to itself sole ownership of the four oil wells located in disputed area close to the Anambra town of AguleriOtu. The state has since set up Orient Petroleum Ltd to exploit the oil resources. President Goodluck Jonathan literally gave Anambra sole ownership of the oil wells last year, when he visited the state for the official inauguration of the Orient Petroleum refinery in Aguleri-Otu. At that event, the president declared Anambra, Nigeria's nineth oil producing state. Now, Kogi has moved to have Anambra relinquish its sole claim to the discovered oil. At least seven persons have been killed and 52 houses burnt in fight between the people of EnuguOtu Aguleri in Anambra East Local Government Area of Anambra State and Ashonwo/Odeke in Ibaji Local Government Council of Kogi State over the disputed land on the oil-rich borders. According to a community leader in Enugu-Otu Aguleri, Chief Anekwe Arinze, the people of Ashonwo/Odeke allegedly invaded their community on Sunday, March 31, at about 1:30am when they had all gone to bed. Said Arinze: “We were sleeping when suddenly we started hearing gunshots everywhere and when some of us came out to know what was happening, we saw our houses on fire. “Our children and women who tried to escape were shot and many were wounded. We heard them saying the land belongs to them and that we cannot take it. That was when we knew it was Kogi people.

Oil well

“Some of our men who summoned the courage to pursue them could not get them because when they noticed our prompt response, they ran away. Already we have counted seven corpses. They also kidnapped three men. But we cannot fold our hands while they kill our people. They must release them to us hale and hearty”. On its part, Kogi State has alleged killing of four people and abduction of two others in attacks on its Odeke and Echeno communities in Ibaji Local Government Area by unidentified persons. Spokesman for the communities, Mr Daniel Omatola, while briefing the state governor, Idris Wada, said four of their people were killed in series of attacks recently launched by some persons suspected to be from Anambra.

He also said that two other persons from the communities were abducted by the attackers whom he said had also destroyed homes and farmlands, thereby displacing hundreds of people from their homes. Omatola called for urgent intervention of the state

government, saying that his people were finding it increasingly difficult to stand the unwarranted attacks and killings of their kinsmen. Wada and his Anambra State counterpart, Peter Obi, has since met over the crisis. Rising from the meeting, which held in

Some of our men who summoned the courage to pursue them could not get them because when they noticed our prompt response, they ran away

Abuja, the two governors called for peace in the two warring communities. They said in a joint communique after the closed door meeting: “For emphasis, neither Kogi nor Anambra state reported any loss of life, contrary to media reports that 57 lives were lost. Only about four motorcycles were destroyed during the fracas". The communique further stated that "both governors sued for peace in Odeke and Aguleri-Otu communities and appealed to them to ensure good neighborliness as the issues in contention are being given due attention by the National Boundary Commission on the directives of the President of the Federal Republic of Nigeria, President Goodluck Ebele Jonathan.”

2013 May, SweetcrudeReports

Community

2013 May, SweetcrudeReports

Niger Delta community

N’Delta Group rejects death penalty for oil theft

O R T HARCOURT Niger Delta youths, under the aegis of the Niger Delta Youth Parliament, NDYP, have rejected the proposed death penalty by the Senate President, Senator David Mark, for those involved in illegal bunkering. The youths described the suggestion by Mark as unfortunate and a mark of insensitivity to the plight of youths in the oil- rich region. National Coordinator, NDYP, Mr. Imoh Okoko, regretted that rather than make laws that would encourage the provision of employment opportunities for youths, the Senate President suggested death penalty for the people of the region Okoko, who explained that

the people of Niger Delta had been facing environmental degradation and acute lack of infrastructure, noted that death sentence would worsen the peple’s plight and would amount to an attempt to wipe out some of the youths in the area. He urged the National Assembly to look into the root cause of oil bunkering and tackle it, advising that only an effective youth employment programme would stop oil bunkering in the area, and not threat of death sentence. Okoko said, “Why would Mark make such a suggestion? From his utterances, the Senate President and most members of the National Assembly are not interested in the oil spills and other form of environmental degradation affecting the people of Niger Delta. “It is insensitive of anybody to prescribe death penalty for

those involved in oil bunkering. The best step the National Assembly would have taken is to make a law that would ensure that youths in the Niger Delta region are employed. “ W i t h g a i n f u l employment, no youth in the Niger Delta will have the time for oil bunkering. It is an irony that while some people are suggesting amnesty for Boko Haram members, our Senate President is prescribing death sentence for oil bunkerers.” He, however, expressed regret that while members of the National Assembly earn jumbo salaries from Niger Delta resources, they could still think of seeking death for the suffering youths of the area. Okoko urged members of the National Assembly to

move a motion for their salaries to be slashed in order to pave the way for Nigerian youths to earn a living. Order Shell to clean up impacted environment, Ogoni tells govt In a related development - Goi, one of the Ogoni communities affected by Shell Petroleum Development Company’s operations in Rivers State, has called on the Federal Government to prevail on oil giant, Shell, to return to clean up impacted environment. Mr. Stephen Kobani, a community leader, said, while inaugurating a new leadership for Goi, that, years after fire from Shell’s operations forced the community to abandon their homes, neither the

government nor Shell had deemed it necessary to clean up the environment. Also, no compensation was paid to the people for the damages caused, he said, adding: “As far as Shell is concerned, we do not exist; that is why since we have been crying out over the sacking of our community by the company’s operations, they have continued to ignore and neglect us.” Also speaking at the event, Mrs. Veronica Kobani, Goi Women Leader, said the incident which destroyed farmlands, rivers and fish ponds, had pushed the community into severe poverty and suffering. “Shell and government should clean up the environment to enable us come back to our ancestral homes,” she said.

Community

2013 May, SweetcrudeReports

Solar project, others improve lives in Cross River

HE Niger Delta Development Commission, NDDC, has inaugurated 20 projects in Cross River State. The projects, acknowledged by leaders of beneficiary communities as having improved the living conditions of the people include roads, classroom blocks, electrification and solar-powered water supply. Inaugurating the projects, NDDC Managing Director, Dr. Christian Oboh, represented by Cross River State Representative on the Board of the Commission, Dominic Edem, said the Commission was determined to complete its projects. Dr. Oboh said gone were the days when children learn under trees and trek long distance to fetch water from the streams, disclosing that “NDDC will bridge the gap by ensuring that the people have adequate classrooms to learn and potable water to drink”. In his remarks, Head of Akim Akim Qua clan in Odukpani Local Government Area, Chief Francis Omin, thanked the Commission for bringing the projects to the community. “We really thank the NDDC for their intervention. The light will attract investors and open the way for economic activities”. Speaking on behalf of the Chairman of Abi Local Government Area, Hon. Emmanuel Elemi thanked the Commission for finding his community worthy of the projects, and pledged maximum utilization. The Paramount Ruler, Ikot Ansa Community, Barr. Patrick Oguagbo while thanking the NDDC said the road will reduce traffic congestion and open up the state for development. On his part, Rev. Fr. David Udo, Vice Principal (Administration), St. Patrick’s College thanked the Commission for meeting the needs of the school. “We are happy that we have water now. Our students used to go out to look for water trekking several kilometers; NDDC has brought life to us because water is life” he said.

Solar panel

NNPC/PPMC debunks reports of imminent fuel scarcity

H E managements o f t h e Nigerian National P e t r o l e u m Corporation, NNPC, and its downstream and marketing subsidiary, the Pipelines and Products Marketing Company, PPMC, have urged members of the public to discountenance the reports of imminent fuel scarcity in the South-West carried in a section of the media as there is no iota of truth in them.

The acting Group General Manager Public Affairs, Tumini Green, explained that it is not true that there has not been loading from the depots in the SouthWest, adding that it was only the depot at Atlas Cove which was temporarily shut down for the maintenance of its power generator which is a standard industry practice. Ms. Green added that the Atlas Cove depot is not a loading but a storage depot, underscoring the fact that loading could not have been affected. “What happened was that one of the major generators at the Atlas Cove was

undergoing a routine maintenance which resulted in a shutdown of pumping activities. The suspension of pumping from Atlas Cove for maintenance did not in any way affect distribution activities as the depots serviced by the Atlas Cove Jetty through the System 2B Pipeline have enough products to keep all the states in the South-West Zone wet throughout the period of the maintenance,” Green stated. “As at this morning, the maintenance which started on Wednesday (early April) has been concluded and pumping has resumed”, she

explained further. She said the depots under the System 2B Pipeline have an average of 5.4 days fuel sufficiency with the breakdown as follows: Mosimi – 6.4 days, Ibadan – 5.9 days, Ilorin –4.2 days, and Ore – 5.1 days. Green urged members of the public to avoid panic buying as there is enough fuel in all the depots to service the zone. She called on journalists to avoid undue sensational reporting that could cause panic among members of the public.

Community

2013 May, SweetcrudeReports

Houston: oil, gas boomtown

Road construction

NDDC begins construction of 6 roads in Imo

he Niger Delta Development Commission, NDDC, has commenced the construction of six road projects in Imo State. The roads include Osina internal roads in Ideato North, Umunakara road in Nkwere, AmaudochukwuAmachikere-Amaegbu road and Umuhu-OkabaIhitenasia road in Orsu Local Government Areas. Others are the Amiyi Mission road in Amiyi-Akah and Umunaka road in Nkwere Local Government Areas. Speaking during the flag-on of Osina internal roads in Ideato North, NDDC Managing Director, Dr. Christian Oboh, stated that the commission was determined to spread development to all parts of the Niger Delta region.

If you have issues with the contractors, don’t hesitate to inform the NDDC because the present board of the Commission will not tolerate indolence or abandonment He assured that the project would be well funded to ensure that it was completed on schedule. Dr. Oboh, who spoke through Barrister Peter Ezeobi, representative of Imo State on the Board of the NDDC, charged the community leaders and youths to co-operate with the Commission’s contractors. “If you have issues with the contractors, don’t hesitate to inform the NDDC because the present board of the Commission

will not tolerate i n d o l e n c e o r abandonment”, he said. On his part, Senator Hope Uzodima, representing Imo West Senatorial district in the National Assembly thanked the NDDC for fast-tracking the development of the rural areas in the Niger Delta. Senator Uzodima, who is a member of the Senate Committee on Niger Delta, disclosed that he was happy to see joy on the faces of the people. Saying, “I want to thank the NDDC for coming to execute this road project in Osina”. The traditional ruler of Osina, Eze Ben Igwilo said the road will open the area to

m o r e development and lauded NDDC for spreading joy to r u r a l communities. O t h e r traditional rulers of the benefiting communities, among them Eze Michael Ozoma Ebighi, Amara I of O k w u Amaraihe, Eze of Amazu, C. A. Olewu Abeoha III, and Eziani of Mgbiani H.R.H Isaac Ezeocha who spoke, were also full of praises for NDDC bringing development to their doorsteps.

ouston, Texas’ energy industry is flourishing, making the job market for today and tomorrow very robust, remarked Huw Rothwell, executive director of Michael Page International at the American Petroleum Institute’s, API, Houston chapter luncheon. Michael Page is a global publically traded professional and executive recruitment consultancy with more than 5,000 employees worldwide. “The oil and gas industry in Houston is in very good condition, adding about 102,000 jobs in the last three years,” he said. The driving economic growth is attributed to: high oil prices, which has encouraged investment, innovative technology - hydraulic fracturing, as well as increased deep water, and domestic production, and investments to new infrastructure. Overall, Texas is witnessing an increase in employment in the oil and gas industry. Last week, the Texas Independent Producers and Royalty Owners, TIPRO, published the “State of Energy” report focusing on quarterly Bureau of Labor census data. Oil and gas industry employment in the state increased from 65,000 to 971,000 in 2012, according to TIPRO. The industry itself has witnessed growth in the United States over the past five years, which has mainly been driven by increased domestic production from shale, said Sandy Fielden in her report “We Should be Heroes! – The Economic Bounty of Shale Oil & Gas”. In 2012, 65,000 new jobs were created in the nation’s industry, including 36,000 new jobs in operations and support activities, 12,750 jobs in crude oil and gas extraction and nearly 8,000 jobs in oil and gas field machinery and equipment, according to the TIPRO report. These numbers are then broken down state by state with Texas ranking as the biggest oil and gas employer, adding more than 380,000 new jobs in 2012. Louisiana ranked second at 81,400, followed by Oklahoma (74,600), California (46,400), and Pennsylvania (34,900). With Texas ranking number one on the employment list, Houston is also ranked at the top as far as employment and people relocating to the city. “The number of mid-to-large companies relocating to the city in 2011 was 195,” stated Rothwell. “People see Houston as the real hub and investments in and around Houston are apparent.” Fifteen major buildings were completed in the first three quarters of last year, and currently, 3.9 million square feet of office space is under construction.

2013 May, SweetcrudeReports

Community

2013 May, SweetcrudeReports

NDDC constructs orthopaedic hospital in Rivers *Dualises Igwuruta-Etche road

h e peop le of Etch e, an oil bearing community in Rivers State will soon be travelling to and from Port Harcourt with ease as the Niger D e l t a Development Commission (NDDC), begins the dualisation of the over 40 k i l o m e t r e Igwuruta-Amala road with bridges. Site Manager of the firm handling the project, Engr. Dyer in a chat with newsmen said the company has completed the asphalting of a b o u t 4 . 3 kilometres after c l e a r i n g , excavation, mounting and grading on both side of the road. Commending the NDDC for embarking on the project, a tipper driver said the expanded road would enhance their sand tipping business. “I am very happy that the N D D C i s expanding this road for us; the dualisation will help us to increase the number of trips we make daily,” he said. Meanwhile the Commission has commenced the construction of a Specialist and Orthopedic hospital in Port Harcourt, the

Orthopaedic ward Rivers State capital. The hospital comprising Orthopedic and Cardiovascular units, when completed will deal with the correction of injuries to the skeletal system, associated muscles, joints and ligaments while the cardiovascular

unit will treat heart problems, said to be prevalent in the region. Briefing newsmen at the project site along Moscow Road, Port Harcourt, Engr. King Babalola disclosed

that his firm has excavated and constructed 349 pads for the one storey orthopedic unit and already started blinding for the foundation of the four-storey cardiovascular

centre. “The foundation stage is the most difficult in building construction but going by the pace of work, we are sure of delivering this project before the end of this year”, he assured..

Community leader laments incessant oil spill in Nembe Kingdom

ENAGOA - Chairman of the Oil and Gas Committee of Nembe Kingdom, Chief Nengi James, has expressed worry over incessant oil spills in the kingdom. James, who was reacting to an oil spill in the Nembe creek, Nembe local government area of Bayelsa State, from a Shell facility, said: “Since I became chairman of the Oil and Gas Committee in the Kingdom, I have witnessed over 10 massive oil

spillages. “And all these spillages have never been cleaned up by the oil company. Instead, what they do is delay response to the cry of the host communities until the heavy tide washes away some signs of the spillage. “The poor response of the company to cases of spillages have polluted our waters and reduced the life span of the people of the area. The

action of the oil company is becoming vexatious and unacceptable. The relevant Agencies and government should intervene and prevail on the company to be responsible.” The spill from SPDC’s Oil Well 62 hit Ewelesuo community and was spotted on the river, mangrove swamp and waterways of the Nembe Kingdom. Timi Standfast, a

fisherman and indigene of the community, said the spill polluted the source of drinking water and impacted negatively on fishing activities, the means of livelihood of the people of the Kingdom. “We called on the SPDC officials and reported the spillage but they have not responded,” he lamented.

Community

2013 May, SweetcrudeReports

Road construction

he Niger Delta Development Commission, NDDC, has inaugurated nine new roads in Delta State. The roads include two township roads in Ovwian, three rigid pavement roads in Uvwie council area, two roads in Warri South, a rigid pavement road in Orhuwhorun town and internal road in Ozoro Polytechnic, Isoko North. Inaugurating the roads, NDDC Managing Director, Dr. Christian Oboh, represented by Delta State Representative on the Board of the Commission, Chief Solomon Ogba, said the road projects were designed to enhance growth in the region. “We want to give NDDC a new face in line with the president’s directives. We want people to see what we have done with the resources available to us” he declared. At Udu Local Government Area, where three roads were ina ug ura t ed , t he

NDDC inaugurates nine new roads in Delta President General of Ovwian community, Mr. William Saiki, thanked the NDDC for putting smiles on the faces of the people. “This project has indeed brought to an end the suffering experienced by residents of Izomo and the community at large”, he said. The Transition Chairman of Udu LGA, Raymond Edijala,

commended NDDC over the quality of the job and pledged maximum utilisation, while the Rector, Delta State Polytechnic Dr. Jacob Oboreh described NDDC as a trail blazer.Meanwhile, Managing Director, Port Harcourt Refining Company, a subsidiary of

the Nigerian National Petroleum Corporation, NNPC, Mr. Lan Udoh, has called on Rivers State governor, Chibuike Amaechi, to step up the war against crude oil theft in the state. Udoh made the call during a visit to the governor at Government House, Port

Harcourt. He said stepping up the fight would guarantee uninterrupted supply of petroleum products to the state.

Total extends rig gig for Pacific Scirocco

acific Drilling S . A . h a s announced that a subsidiary of Total S.A. has elected to exercise a one-year option to extend the firm contract term for the Pacific Scirocco

(UDW drillship) to January 2015. The contract provides for a further option, to be exercised at the client’s discretion by April 7, 2014, which could result in two additional years of contract term at a higher dayrate. The

additional one year term increases the drillship’s backlog by approximately $180 million, bringing the company’s total contract backlog as of April 9, 2013, to approximately $3.4 billion. The additional extension for

two years would add a further $364 million backlog if exercised. The Pacific Scirocco is capable of operating in water depths of up to 12,000 feet and drilling wells 40,000 feet deep.

Community

2013 May, SweetcrudeReports

Waste management plant

NIMASA to enforce offshore waste reception

he Nigerian Maritime Administratio n and Safety A g e n c y , NIMASA, says the implementation of the offshore waste reception facilities would take effect from this month. It disclosed this at a meeting between it and oil companies operating in Nigerian waters, where it also announced the introduction of a Sea Protection Levy to be paid by all oil companies with loading receiving bays, oil rigs and pipe lines.

According to NIMASA Director-General, Mr Patrick Akpobolokemi, the objective of the regulation was to improve and sustain the marine environment by developing a maritime environmental management system through self-funding. Represented at the meeting by the Executive Director, Maritime Labour and Cabotage Services, Mr Callistus Nwa b ueze Ob iwuzie, t he NIMASA boss explained that implementation of the Sea Protection Levy had already commenced. The Agency puts the rate payable per annum for offshore

installations by oil companies at N15 million, adding that oil wells for exploration would attract N10 million per annum from first day of April every year. While pipelines would attract N1,500 per cubic metre of pipe line volume from high water mark to termination point offshore. Akpobolokemi said the Federal Government had introduced all these in its determination to ensure the protection of the marine environment and its resources ratified the Marine Pollution, MARPOL, convention, the

major instrument of the International Maritime Organisation, IMO, on the prevention of pollution of the marine environment. He said the move was also in line with the IMOâ&#x20AC;&#x2122;s Marine Environment Management Regulations 52 and 53 on Sea Protection Levy and Offshore Waste Reception Facilities. The NIMASA DirectorGeneral noted that the c o n v e n t i o n w a s domesticated in 2012, to prevent land degradation and destruction of the ecosystem with attendant economic implications

which oil pollution has caused the nation. NIMASAâ&#x20AC;&#x2122;s head, Maritime Environment Management, Mrs Abiodun Gunwa, explained that the Agency introduced the Marine Environment Sea Protection Levy through a marine notice last August. Gunwa said that the levy must be paid by all commercial operating vessels of 100 gross tonage and above operating in Nigerian waters, adding that the same was applicable to potential oil polluters, installations and pipelines.

2013 May, SweetcrudeReports

Community

2013 May, SweetcrudeReports

Agip accused of covering up oil spill in Rivers

ort Harcourt – The Nigerian Agip Oil Company has been accused of burning farmlands in Akala-Olu community in Ahoada West Local Government Area of Rivers State in order to cover up evidence of its oil spill on their land. Protesting villagers disrupted traffic at the Ahoada area of the EastWest Road over the incident, claiming in doing that, the oil compny destroyed their farmlands. A community leader, Nathan Alaga, from the affected Umu-Isogba extended family said a joint inspection of the spill facilitated by the Rivers State Ministry of Environment in March, had

established that it was a repeat of 2002 overflow of Waste Pit and Hot Water seepage from nearby Ochie Flow Station operated by Agip. According to him, ministry had recommended negotiations between the company and the affected landowners to determine compensation for the damaged farmlands, fish ponds and ancestral shrines in the affected area before cleanup and remediation were carried out. He alleged: “Without meeting with us, Agip came March 13, and said they want to clean up the spill and the family opposed the action. There and then, Agip officials set the spill site on fire and burnt the entire area.”

Oil refinery

Oil companies' CRS now subject to manipulation, abuse, says Group

AGOS - The corporate social responsibilities, CSRs, of oil companies operating in Nigeria have become subject to manipulation and abuse, according to the Environmental Rights Action/Friends of the Earth Nigeria, ERA/FoEN. The group, therefore, has called on oil companies to put an end to the policy. ERA/FoEN stated this through its Executive Director, Godwin Ojo, who spoke at at a lecture on the ‘Role of Civil Society Groups in Social and Environmental Justice Struggles’, in Lagos. “Until environmental health is restored, we call for the immediate suspension of all forms of oil companies’

corporate social responsibility that is weakening and dividing the people than providing any net material benefits. “Oil companies should stop forthwith the substituting of C S R s c h e m e s f o r environmental remediation and compensation,” Ojo said. He quoted a United Nations Environment Programme, UNEP, report in 2011, which documented how oil companies systematically contaminated 1,000 square kilometres area of Ogoniland, a pollution that would cost over $1 and take up to 30 years to clean up. He maintained that the “ c r i m e s c e n e ” o f environmental despoliation is intensifying throughout the Niger Delta, and less than one percent of environmental justice cases make it to the

After 10-15 years of litigation, communities are forced to accept paltry compensation and to sign indemnity clauses that absolve such oil companies from remediation Nigerian courts. The ERA/FoEN chief added: “Ecological debt from environmental destruction is piling up and it is time for the agents and corporations to pay up. “It is sending victims to their untimely graves as

impunity is left unchecked. We urge policy makers and parliamentarians to put in place a policy framework to k i c k - s t a r t t h i s Environmental Tribunal process to allow for corporate and individual liability.”

Urging an amendment in the law of evidence and proof in environmental cases, Ojo stated that in the case of oil pollution, "the burden of proof should shift to the respondents to demonstrate otherwise claims by the plaintiffs". “This is because the burden of proof as currently practiced is too heavy a duty to be discharged by the poor hapless victims,” he said. “So far, less than one percent of the environmental justice cases ever make it to court due to crucifying inhibitions strewn in the way of justice. “After 10-15 years of litigation, communities are forced to accept paltry compensation and to sign indemnity clauses that absolve such oil companies from remediation,” he argued.

Community

2013 May, SweetcrudeReports

NigerDelta

Question

JOHN IYENE OWUBOKIRI

Shale gas & the future of the Nigerian state

Oil theft in Niger Delta

Oil theft has ‘significant’ environmental cost—Shell

i s i n g incidences of oil theft in Nigeria’s oil producing N iger Delta come at a significant environmental cost, Royal Dutch Shell has said . In its sustainability report, the Anglo-Dutch oil major said its Nigerian unit, Shell Petroleum Development Company, or SPDC, experienced 137 spills as a result of sabotage and theft last year, with the volume of oil lost amounting to 3.3 thousand tons. “This was an increase in both volume and numbers from 2011, as the scale of oil theft in Nigeria reached unprecedented levels,” it said in the report. In an open letter published in the report, SPDC’s managing director, Mutiu Sunmonu, said the problem of oil theft in the Niger Delta has reached “unprecedented levels” and puts enormous strain on the company’s staff, as well as costing Nigeria the country billions of dollars a year in lost revenue. He added that the Nigerian government puts the volume of oil stolen significantly above the 150,000 barrel a day estimate given by the United Nations in 2009.

It may never be possible to assess the exact figures, but it’s clear that a well financed and highly organised criminal enterprise exists on a phenomenal scale...Most of the stolen oil ends up in oceangoing tankers that transport it to refineries in other parts of West Africa, Europe and beyond “It may never be possible to assess the exact figures, but it’s clear that a well financed and highly organised criminal enterprise exists on a phenomenal scale...most of the stolen oil ends up in oceangoing tankers that transport it to refineries in other parts of West Africa, Europe and beyond,” Mr. Sunmonu said. “Where possible, we are taking steps to make it more difficult for the thieves to tap into and steal oil from our pipelines,” Mr. Sunmonu said, without providing details. However, disruptions remain significant. Onshore production from SPDC’s facilities were 20% below capacity last year as a result of pipeline shut downs related to oil theft, the report said and last month SPDC said it would have to shut its 150,000 barrel a day Nembe Creek oil pipeline in order to clear illegal oil tappings.

In its report, Shell called on the Nigerian and international governments and local communities to take steps to stop oil theft in the Niger Delta. “We urgently need more assistance from the Nigerian government and its security forces, other governments and other organisations,” Mr. Sunmonu said. In contrast to the growing incidence of theft, Shell said it improved its record in terms of operational spills in Nigeria last year. The company said it experienced just 36 operational spills in 2012, down 40% from the year before, while the volume of oil spilled more than halved to 0.2 thousand tons. According to its report, SPDC has replaced almost 500 kilometers of pipeline in the last three years and is working to replace more of the infrastructure.

hale gas. The words are “ornery” and so uncluttered that it appears unfair that they should portend the gradual demise of the Nigerian economy. The Nigerian economy, powered primarily by earnings from oil and natural gas, is jaywalking into a state of uncertainties as no efforts are being made by the authorities by way of research and development to replace and multiply the power base of the economy. Shale gas is natural gas with the difference that it is usually found trapped in shale formations. It was first extracted as a resource in Fredonia, New York in 1821 in shallow low pressure fractures, between the 1930s and 1947 horizontal drilling and a formally fractured well were achieved with the resource but it was only in the 1970s that the potential for industrial-scale production was achieved. It is no secret that the United States and a few countries in Europe are investing huge sums in R & D to unlock the hold of the Arabian Peninsula over the industries of the West. The introduction of shale gas into the energy market is fast changing the existing matrix in the industry. In 2000, it provided only 1% of America’s natural gas production and by 2010, it had exceeded 20%; the US estimates modestly that by 2035, 46% of the country’s natural gas needs will come from shale gas. Why should Nigerians worry? About two years ago, Nigerian crude oil supplies to American refiners topped 1.1million barrels per day but in January 2013, 27 cargoes had not been lifted; crude oil supplies from Nigeria to the US had dropped to a worrisome 360,000 barrels with the potential of dropping to 140,000 bpd before the end of the third quarter of 2013! And the worst news: shale gas is a perfect mimic of Nigeria’s Bonny Light, the unique blend of crude that has played the role of a market contrast worldwide to the more common Brent. The US is producing shale gas rapidly; Canada, Australia and many Asian countries are catching on. It is believed that China has the largest deposits of shale gas. The picture looks blearier when you consider that shale gas is only one out of five potential replacements for fossil fuels resulting from R & D efforts of the Industrialised nations. Nigerian authorities have ignorantly planned their yearly (truly, as Botha said, sub-Saharan Africans do not plan beyond one year) budgets on the basis of a projected price of crude oil. While other nations are constructing historical monuments both in their national literature and in their collective psyche of the fading resource, Nigeria has not managed to achieve an Industry Bill few years into its demise. The country’s R & D efforts in this area is personified by two lovely eyeballs, strutting nicely in well swaddled ankara on the catwalks of Abuja, Los Angeles, New York and Houston with a honky thonky accent that can be Bode Thomas, Aguda or even Southern Diobu in Port Harcourt marketing and ever marketing the non-achievements of a dying industry! And then the attitudes displayed by the ruling party in Nigeria makes us wonder. The national government and the state governors are in contest over spheres of influence, the next set of elections, offices, derivative revenue, revenue sharing and positions but never the current state of infrastructure, the challenges of Nigeria’s unplanned neighbourhoods and cities, planning the future, Nigeria’s participation in the debate over the North Korean question, the challenge of homosexual culture to world safety and security, the breaching of inequities through quality education and other policies, the benefits of representative democracy to national development and the unanswered questions about the limits of capitalism. This class of politicians selected and placed in office by an arbitrary system that has no respect for the will of the electorate or the preference of the masses, defines the manifestation of the basest instincts of the Bantu, the West African tribesman, in a state of war! Their greed is equal only to their ignorance of the economics of unearned income. And so it was that we opened our flanks for the destruction of our future by factors such as shale gas. The bright side to ponder upon is that whether by force majeure or market forces, whichever entry preference shale gas comes at us, someone, most likely “Naomi Campbell” will finally be out of a job.

2013 May, SweetcrudeReports

Technology

2013 May, SweetcrudeReports

The Plasma Arc Lamp used in the CermaClad manufacturing process

Company hopes to expand offerings to oil sand CONTINUED FROM PAGE 66 the total facilities to around 10 over the next three years. A single four-line plant can manufacture up to 538,195 square feet (50,000 square meters to 861,112 square feet (80,000 square meters) per year. The company is working with Brazilian state energy company Petroleo Brasileiro (Petrobras) to meet demand for clad pipe in that market. Abakan is seeking to construct a 4-line clad pipe manufacturing facility in Brazil, and has hired law firms, auditors, a construction manager and const ruct ion firm , a nd expects to secure land soon and order long lead items to start construction of the facility. The Brazil plant will be capable of producing 49 miles to 62 miles (80 kilometers to 100 kilometers) a year of 10 to 16-inch diameter pipe to service the primarily sour oil that Petrobras will produce from fields offshore Brazil. Petrobras has turned to MesoCoat because it needs anti-corrosive pipe for the more than $220 billion in oil and gas exploration projects it will pursue offshore Brazil. These projects involve corrosive pre-salt and

deepwater environments. Additionally, the company is working with a number of U.S. Gulf of Mexico operators, where a number of projects are entering the front-end engineering and design stage of development. Company officials also hope to close a deal next month to expand its offerings to oil sands operations in Canada, and are in discussions to partner with sovereign wealth

CermaClad pipes

funds and strategic partners to set up international operations in Indonesia, Middle East, India and South Korea. The company is also partnering with the Northern Alberta Institute of Technology and the Alberta Innovates Technology Futures organization to expand its offerings to oil sands operations in Canada.

MesoCoat anticipates additional partnerships with Alberta to be announced sometime in the near future. The company added it is in discussions to partner with sovereign wealth funds and strategic partners to set up international operations in Indonesia, Middle East, India and South Korea. Abakan officials also see market opportunity in the

Caspian and Middle East regions, which will need clad pipe as water injection operations when both regions run out of sweet crude forcing oil and gas operators to begin producing sour oil. Karen Boman has more than 10 years of experience covering the upstream oil and gas sector. Email Karen at kboman@rigzone.com .