Breaking News: Court stops NLC, TUC from embarking on strike

By Ikechukwu Nnochiri


ABUJA – The National Industrial Court, NIC, sitting in Abuja has stopped the Nigerian Labour Congress, NLC, and the Trade Union Congress, TUC, from embarking on a strike action tomorrow.

The labour unions had in a communique they issued at the end of an emergency meeting the held on Saturday, vowed to embark on a nationwide industrial action should the federal government refuse to reverse the sudden hike in the price of fuel.

However, in a ruling on Tuesday, the NIC President, Justice Babatunde Adejumo, restrained the labour unions from going on strike, pending the determination of a suit the federal government lodged before it.

Justice Adejumo further ordered all the parties to maintain status quo until the legal dispute is settled.

The order followed an ex-parte application that was filed by the Attorney General of the Federation and Minister of Justice, Abubakar Malami, SAN.

Determined to abort the planned strike action, the AGF approached the NIC, begging it to restrain the labour unions from “shutting down the nation”.

Placing reliance on section 14 of the 1999 Constitution, as amended, FG, insisted that it would not be “in the national interest” for the NLC and TUC to proceed on nationwide strike over the fuel price increase.

Malami, SAN, argued that ‎no amount of damages could serve as compensation if the labour unions are allowed to shut down the economy.

Contending that the balance of convenience was in favour of the government, the AGF, prayed the court to determine “Whether the respondents (NLC, Trade Union Congress) have complied with the laid down condition precedent for embarking on strike‎”.

As well as, “Whether indeed there exist in law and in fact the basis of which the respondents’ total closure of the economy can be justified”.

He told the court that the respondents met on Saturday and issued a communique wherein it gave government a three-day ultimatum to reverse the decision increasing fuel price.

He said the respondents, aside threatening to shut down the country if government failed to reverse the fuel price increase, equally threatened to close down all government offices, seaport, airports and markets.

The AGF argued that ordinary and law abiding citizens would be subjected to hardship if the respondents were allowed to go ahead with their threat.

He said the government was left with no alternative but to seek the intervention of the court.

Besides, Malami told the court that he got notice of the communique on Sunday and quickly filed an originating summons, a motion on notice and an ex-parte application to determine whether NLC’s decision was justifi‎ed in the circumstance.

He insisted that “great and irreparable damage” would be done against the nation and “ordinary and law abiding citizens”, should the court refuse the ex-parte application.

Meanwhile, though neither NLC nor TUC was represented in court, Justice Adejumo granted the ex-parte motion, even as he ordered the service of all the relevant court processes on the respondents.

The restraining order against the respondents will elapse after seven days.

Labour unites against Buhari, vows to shut down Nigeria



Labour unites against Buhari, vows to shut down Nigeria


The two factions of the Nigerian Labour Congress (NLC), the Trade Union Congress (TUC) and members of Civil Societies, yesterday, rose from their respective emergency National Executive Council (NEC) meetings, vowing to call out Nigerians on a nationwide strike on Wednesday if the Federal Government fails to retrace its steps on the contentious N145 new pump price of petrol recently announced by the Minister of State for Petroleum, Dr. Ibe Kachikwu.

The announcement by the junior minister ‘deregulating’ the downstream sector of the Nigerian oil and gas industry has also ignited another round of free fall of the naira in the foreign exchange market.

A development the president of Association of Bureau De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe, said was caused by the permission the minister granted the fuel importers to source their foreign exchange from secondary sources.

According to him, the market had been stable all this while due to drastic reduction in imports, “but the announcement on Wednesday has changed the whole thing.” He fears that the exchange rate will rise to N400 a dollar this week if the condition persists. On Thursday, the naira lost N7 to the dollar as exchange rate rose sharply to N334 per dollar from N320 per dollar.

This persisted on Friday with the parallel market exchange rate rising to N370 per dollar which translated to N50 depreciation of the naira in two days.

Kachikwu had said that the lingering fuel scarcity in the country was caused by the forex crisis in the country since the collapse of the prices of crude in the international market.

A development that forced the Central Bank of Nigeria (CBN) to peg the official exchange rate of the naira against the US Dollar at N197 a dollar.

He said, “The reason for the current problem is the inability of importers of petroleum products to source foreign exchange at the official rate due to the massive decline of foreign exchange earnings of the Federal Government. As a result, private marketers have been unable to meet their approximate 50 per cent portion of total national supply of PMS (Premium Motor Spirit, also known as Petrol).”

It is against this backdrop that experts say that unless the fuel subsidy is retained, the importers will in the nearest future, increase the pump price of petrol again, otherwise, they will be running at a loss and will not be able to go back and import more.

The options available then are that the subsidy is retained and the price pegged or the importers continue to bring in the product at the rate naira is exchanging with the dollar at the forex market and sell as he buys.

The implication, according to a former president of Association of National Accountant of Nigeria (ANAN) Dr. Samuel Nzekwe, is that price of petrol would rise to N200 a litre gvery soon and will then fall down slowly if the naira stabilises.

Meanwhile, the organised labour, accused the President Muhammadu Buhari administration of betrayal of trust reposed on him by Nigerians, stating that the hardship the administration has brought on Nigerians since its inception over a year ago is not in tandem with the change mantra of the ruling All Progressives Congress (APC) which Nigerians voted for.

President of the Wabbaled faction of NLC, Comrade Ayuba Wabba, at the end of the union’s meeting in Abuja yesterday, lamented that President Muhammadu Buhari had broken his electioneering promise of not removing fuel subsidy if he was elected.

According to him, the Congress would on Wednesday May 18 mobilise Nigerians to the streets, close down the airports, sea ports as well as all public and private offices after which he added that the labour unions would direct Nigerian workers to embark on indefinite industrial action as their response to the government’s policy.

The NLC President, who read the communiqué issued at the end of the meeting on behalf of other unions, lamented what he called the Federal Government’s disinclination for consultation on issues of public interest and its obsession with protecting product marketers at the expense of the Nigerian public.

The Comrade Joe Ajeroled NLC, which concluded its emergency Central Working Committee (CWC) meeting, in Lagos yesterday afternoon, said, “Where the government fails to heed these calls and correct itself, we shall be forced to call Nigerian workers and masses out onn the streets all over the country to shut the critical sectors of this economy down for as long as it shall take to force the government to subject itself to the desires of the people.”

Comrade Wabba noted that after his election, President Muhammadu Buhari had maintained that there was no subsidy in the petroleum product price regime and that even if there was, he did not see how its removal would be beneficial to the ordinary Nigerian, noting that the slightest product price adjustment often leads to inflationary spiral and unimaginable suffering for the people.

“On January 18, 2016, the government further allayed the fears of the Nigerian people by reducing the pump price of PMS to N86:50, explaining that the reduction was in furtherance of the implementation of the revised component of the Petroleum Products Pricing for PMS and kerosene,” he said.

The unions also blasted Kachikwu for allegedly speaking from both sides of his mouth saying, “Whereas last year, he had strongly canvassed for the removal of ‘subsidy’ in defiance of President Buhari, about a month ago, he claimed the subsidy had been removed through his ingenuity and that Nigeria was saving $1billion from this process”.

The unions had, therefore, wondered what informed government’s sudden and dangerous policy summersault and its desperate attempt to convince the public that Labour was part of the decision that led to this price increase.

They further said that the new price announced by the Federal Government without the input of the board of the Petroleum Products Pricing Regulatory Agency (PPPRA), which is statutorily vested with powers to recommend price, is illegal, noting that since the board of PPPRA was yet to be constituted, the Federal Government has no right to fix price unilaterally.

While arguing that the new price increase is unrealistic, unaffordable, unacceptable and is thus rejected by Nigerian workers, the NLC President said that there has been no increase, in the past five years, in salaries or wages or pensions in the face of devaluations, spiralling inflation and other vagaries of the economy.

He said that government is unable to justify the price increase other than the puerile explanation that marketers need to recover their costs, without a thought for the aggregate or larger national interest including the need for local refining and creation of jobs.

Speaking also on the increase in electricity tariff, Comrade Wabba said that government has remained recalcitrant in spite of a subsisting court injunction on the issue of the criminal increase in electricity tariff even in the face of everworsening power supply situation.

“From the foregoing, it is evident that the neo-liberal forces in the government have taken over the government and we should expect more inhumane policies which will further degrade the living standard of the average Nigerian. The punitive electricity tariff and PMS product prices may just be teasers.”

On the position of National Union of Petrol and Natural Gas Workers (NUPENG) and Petrol and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), who have already supported the deregulation of the oil and gas sector, the NLC President said: ”NLC, TUC and other civil society allies are not unaware of the positions taken by the Unions in the oil and gas industry.”

“A process of engagement will be put in place in order to ensure the success of the struggle to protect the overall interest of the Nigerian people,” he added.

Source: Today.NG –

Why FG increased petrol pump price to N145 per litre – Kachikwu

By Levinus Nwabughiogu

ABUJA – Minister of State for Petroleum, Mr. Ibe Kachikwu, Wednesday, defended the jerking up of pump price of Premium Motor Spirit, PMS, also known as fuel by the federal government from N86:50 to N145, saying that it was the only way out of the exorbitant prices of N150 to N250 Nigerians were subjected to at many filling stations across the country.

He however stated that government had articulated many social protection programmes in the 2016 budget to cushion the effect the hike may have on Nigerians.

Rising from a meeting chaired by Vice President, Yemi Osinabjo which also had other various stakeholders including the Leadership of the Senate, House of Representatives, Nigerian Governors Forum, and Labour Unions (NLC, TUC, NUPENG, and PENGASSAN), at the Aguda House, official residence of the Vice President, Kachikwu noted that “the reason for the current problem is the inability of importers of petroleum products to source foreign exchange at the official rate due to the massive decline of foreign exchange earnings of the federal government. As a result, private marketers have been unable to meet their approximate 50% portion of total national supply of PMS.”

The minister who briefed the State House Correspondents on the resolution of the meeting said that to wet the country with fuel, any Nigerian entity was now free to import the product, subject to existing quality specifications and other guidelines issued by Regulatory Agencies.

“We have just finished a meeting of various stakeholders presided over by His Excellency, the Vice President of the Federal Republic of Nigeria.

“The meeting had in attendance the Leadership of the Senate, House of Representatives, Governors Forum, and Labour Unions (NLC, TUC, NUPENG, and PENGASSAN). The meeting reviewed: “The current fuel scarcity and supply difficulties in the country. “The exorbitant prices being paid by Nigerians for the product. These prices range on the average from N150 to N250 per litre currently.

“The meeting also noted that the main reason for the current problem is the inability of importers of petroleum products to source foreign exchange at the official rate due to the massive decline of foreign exchange earnings of the federal government. As a result, private marketers have been unable to meet their approximate 50% portion of total national supply of PMS. “Following a detailed presentation by the Honorable Minister of State for Petroleum Resources, it has now become obvious that the only option and course of action now open to the government is to take the following decisions: “In order to increase and stabilise the supply of the product, any Nigerian entity is now free to import the product, subject to existing quality specifications and other guidelines issued by Regulatory Agencies. “All Oil Marketers will be allowed to import PMS on the basis of FOREX procured from secondary sources and accordingly PPPRA template will reflect this in the pricing of the product. “Pursuant to this, PPPRA has informed me that it will be announcing a new price band effective today, 11th May, 2016 and that the new price for PMS will not be above N145 per litre. “We expect that this new policy will lead to improved supply and competition and eventually drive down pump prices, as we have experienced with diesel. In addition, this will also lead to increased product availability and encourage investments in refineries and other parts of the downstream sector. It will also prevent diversion of petroleum products and set a stable environment for the downstream sector in Nigeria. “We share the pains of Nigerians but, as we have constantly said, the inherited difficulties of the past and the challenges of the current times imply that we must take difficult decisions on these sorts of critical national issues. Along with this decision, the federal government has in the 2016 budget made an unprecedented social protection provision to cushion the current challenges. “We believe in the long term, that improved supply and competition will drive down prices. The DPR and PPPRA have been mandated to ensure strict regulatory compliance including dealing decisively with anyone involved in hoarding petroleum products.”

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Fuel subsidy: It’s time for difficult decisions – Osinbajo


Fuel subsidy: It’s time for difficult decisions – Osinbajo

Vice-President Yemi Osinbajo (SAN)


Ahead of the federal government’s announcement tomorrow on the removal of subsidy on petrol, Vice-President Yemi Osinbajo has said that the government will have to take tough decisions on the desirability of retaining fuel subsidies, adding that it had become necessary to remove them.

His statement coincided with a remark by the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, who confirmed that the government would in the next few days unveil a new policy to address the subsidy issue in the country.

Osinbajo, who spoke at the third Ogun State Investors’ Forum held in Abeokuta, the state capital, said: “No matter how we slice it, we are in economic times that are challenging, but they provide us with some of the best opportunities for making a real difference in our economic life.

“I think that we are at a point that a lot has been said about subsidies and what to do with subsidies. I think we are at a point where we must make many difficult decisions and make very tough choices.

“But I think the Nigerian people are prepared for all what is required and all it would take to make a real difference.

“In no way can a country make the kind of progress we expect it to make without being able to ensure that in public life our finance system is transparent and would ensure that there is accountability.

“Our Ministry of Finance has been putting in place a system that would assure accountability. It would ensure that public funds are accounted for and that the country is not exposed to some of the kinds of huge corruption that we had seen over the past few years.”

He also urged state governments to encourage and support agriculture, noting that “in the area of agriculture I know that there is so much room for so much more”.

He said: “The agriculture borrowers scheme is one I am not so sure any other state aside from Kebbi has adopted. And that programme is one where the Central Bank of Nigeria (CBN) has been able to lend to small rice farmers.”

He also advised states to do more in terms of generating electricity, stating: “I think that we can rewrite some of the regulations in such a way that states can generate more power.”

In the area attracting investments to the states, Osinbajo said: “The president has mandated the Minister of Trade, Industry and Investment to do something about the ease of doing business in the country.”

Backing Osinbajo, the former President of Colombia and Secretary General, Organisation of American States, Mr. Cesar Gaviria Trujillo, said a policy that had to be addressed head on was the one on the desirability of the retention of fuel subsidies, saying: “This is the moment to eliminate the subsidies.”

He said: “You cannot keep paying subsidies, most of which end in the hands of some privileged people. What you need is a good tax system – improve income tax, improve value added tax and eliminate subsidies. That is the task this government can use to tackle this crisis.”

Ogun State Governor, Senator Ibikunle Amosun, who hosted the forum, affirmed that the state in the last five years of his administration had been set firmly on the path of prosperity, adding that it intends to consolidate on its successes and chart a new course for socio-economic development and wealth creation.

He revealed that the first and second editions of the investors’ forum had not only earned the state its position as one of the fastest growing investments destination in Nigeria, but in the whole of West Africa.

He said that the forum would focus on improving available infrastructure in Ogun State, while developing new ones, and would encourage genuine investors to acquire land by offering them significant discounts at various levels.

The forum, he added, would create the avenue for the aggressive promotion of agriculture, which has been identified as the pivot of the state’s industrialisation plan, among others.

He said the state would diversify its economy by effectively harnessing its rich mineral resources by encouraging existing and potential investors in the sector.

Ogun state, Amosun noted, would also take full advantage of its proximity to the largest market in West Africa, Lagos, including other South-western states and also the West African sub-region.

Also speaking on the subsidy issue, Kachikwu said that the introduction of price modulation had helped to stabilise the situation.
The minister, who spoke during the second leg of the federal government’s town hall meetings held in Kaduna, however added that it was necessary for the country’s oil sector to reflect the global pricing of the product.

“We are coming up with a policy in the next few days that will allow us develop the price modulation that allow us to swing our price along with international pricing.

“We are now transiting into fuel modulating pricing because we do not have sufficient foreign exchange to continue the fuel importation we have been doing.

“Therefore, NNPC has to import about 100 per cent of the product, that is the cause of the scarcity,” he explained.

According to the News Agency of Nigeria (NAN), the minister said that the NNPC does not also have the logistics and coverage for the effective distribution of petrol, adding that there was no allocation for fuel subsidy in the 2016 budget.

He said: “The federal government has struggled to offset the N600 billion subsidy balance when the administration came into power.”

On the uncompleted Petroleum Institute in Kaduna, the minister said that his ministry had created a skills learning department to coordinate staff training and the running of its specialised centres in Warri, Lagos and Kaduna.

Kachikwu said the department would provide research and training skills needed for effective refining and other services in the oil sector.

He said the Kaduna Petroleum Institute was programmed to provide skills to HND graduates in refining and solar energy and to prepare them for employment in the oil industry.

On oil exploration in Northern Nigeria, the minister said that the government had invited investors to explore for oil in the region.

“I am one of those who believe that with modern technology, oil and gas exist in every part of Nigeria,’’ he said.

According to him, research conducted in the last six months revealed that oil and gas could be found in the North.

“We are putting a lot of investment and we are inviting people to invest money. We have set up a department which is doing three things for the north,” he said.

Meanwhile, despite the twin attacks on Chevron’s facilities in the Escravos area of Delta State by militants, the company is set to export at least two very large crude carriers (VLCC), each with a capacity of 950,000 barrels of crude oil per week, translating to 1.9 million barrels weekly, investigations have revealed.

The country will also soon experience relief in terms of increased crude exports and availability of more gas for power generation as repair works will be completed at the Shell-operated Forcados subsea pipeline on May 29.

Unlike the February subsea attack on the Forcados pipeline, which forced Shell to close its Forcados Export Terminal, it was gathered that the attacks on Chevron did not disrupt the loading of crude oil into the 400,000 barrels per day Escravos Export Terminal, as many other producing fields in the western Niger Delta continue to feed the export terminal.

There are also indications that the Nigerian National Petroleum Corporation (NNPC) will export more crude oil through the Escravos export terminal as the corporation’s equity crude that should have been sent to Warri and Kaduna refineries, would now be diverted to the terminal following the attack on the pipelines feeding the refineries.

The addition of NNPC’s equity crude, it was learnt, will increase the lifting rate at the export terminal, which a Chevron said normally takes three days to load a 950,000 barrel-capacity crude carrier.

The official, who spoke on the attacks, said yesterday that though the threat by the militants was real, the company would not shut down its western Niger Delta operations.

“Chevron is a business empire and they will not close down operations in the area unless the threat is enough to shut down Chevron in its entirety,” he said.

Investigations further revealed that while Chevron shares its 950,000 barrels equity crude with other partners – Dubri Oil and Conoil – NNPC’s equity crude was also put at 950,000 barrels.

The February subsea attacks on the Forcados pipeline, which reduced production by the Nigerian Petroleum Development Company (NPDC) from 250,000 barrels per day (bpd) to about 115,000bpd, also forced Shell to close the Forcados Export Terminal, removing 250,000bpd from the export schedule, and reducing Nigeria’s output to about 1.69 million bpd, the lowest since June 2007.

Before the twin attacks on Chevron’s facilities, NNPC’s monthly financial report showed that crude oil worth N20 billion was lost to the Forcados attack between February and March.

But it was gathered that the Escravos attacks did not disrupt the loading of crude oil into Chevron’s export terminal, as only the Okan oilfield was partly affected, while other producing oilfields that feed into the export terminal, have continued to pump crude oil.

However, Shell has informed the fifth monthly meeting of the Minister of Power, Works and Housing, Mr. Babatunde Fashola, with operators in the power sector held on Monday at the Shiroro Hydroelectric Plant in Niger State, that the repairs on the Forcados export line would be completed on May 29, 2016.

According to the communiqué issued at the end of the meeting, repairs to this pipeline would be vital to improving the current electricity situation and would be closely monitored by the meeting’s secretariat.

Shell also told power sector operators that it had commenced supply of gas to Gbarain Ubie power plant in Bayelsa State which just started generating electricity.

It was reported that the plant is the only National Integrated Power Project (NIPP) that does not have gas supply issues because of its proximity to Shell’s Gbarain Ubie integrated oil and gas project.

Agriculture Is A Lifetime Opportunity For Nigeria – Aliko Dangote


Nigeria’s leading industrialist and President of Dangote Group, Mr Aliko Dangote, has again challenged the country to further explore agriculture as this is its surest way to break free from economic challenges.

He was speaking on Tuesday at the opening ceremony of the Katsina State Economic and Investment Summit with the theme ‘Unlocking Investment Potentials for Sustainable Development’.

Mr Dangote explained that “Brazil has 350 billion dollar in reserves of which 80% of that money is contributed by Agriculture”.

“I think it’s a lifetime opportunity which God has given to us by repositioning things while oil has gone down. It is not a curse, it is for us to diversify the economy. We have been relying on oil and I think oil very unreliable.

“When you look at it, despite the downturn of various economic activities in the whole world, the only things that have actually not gone down are agricultural products.

“Rice, wheat, sugar have not gone down in price, so we should make sure that we use this opportunity which God has given us – arable land.

“Both us and Brazil, we have the same quality of land and Brazil today are number one in sugar, soybean, poultry and in a lot of things. So I think we should copy that.”

He said that the decision to open up Katsina State to investors was long overdue as the state has been behind other states economically. He commended the State Governor for the initiative.

“I think the only way for Katsina State to catch up is to concentrate on Agriculture,” he added.

He, however, emphasized the need to create an enabling environment for investment as being the most effective way to attract investors.

He said, “Investors normally do not need to be told. You don’t need to invite anybody, if they see a conducive environment for investment, they will actually gate-crash even if they are not invited.”

He went on to enumerate five steps that need to be taken for potential investors to see an enabling environment.

“One is to identify the sectors of the economy where the state has a comparative advantage, and develop information and data which will enable investors evaluate opportunities in these sectors.

“Publish clear legal and regulatory terms and clear incentives to guarantee profitability for investors.

“Provide an incumbent land and reasonable supporting infrastructure and let investors do the rest.

“Ensure that all your officials buy in to the vision, (because) nothing will discourage investors more than uncooperative and hostile public officials.

“The final piece of advice is to start with your local investors or those who are already here with you. If they are happy and making good (revenue), they will definitely invest more and the foreigners will cue in.

“You don’t need anybody to come and bring in foreign direct investment (FDI). FDI always follows local direct investment,” he said.

Source: ChannelsTV –

Nigeria set to fully deregulate downstream, petrol to sell for over N100 a litre

Barring any last-minute change in plans, the federal government will,  in a few days, introduce policy changes heŕalding the full deregulation of the downstream sector of the Nigerian petroleum industry, officials well briefed on the matter have told PREMIUM TIMES.

Nigerians may have to brace up for a minimum of 27.17 per cent hike in fuel price nationwide, the officials said.

The policy, they say,  is likely to push the pump price of petrol to about N110 per litre at NNPC-owned filling stations and higher at other independent outlets.

Amid fears of a possible backlash reminiscent of the reaction by Nigerians in January 2012 when former President Goodluck Jonathan attempted to introduce a similar measure, PREMIUM TIMES learnt that no formal announcement of the policy would be made by government.

Industry sources familiar with the plan said government was on the verge of discreetly giving permission to petroleum products marketers to gradually adjust their pump prices as early as midweek to signal the formal take-off of deregulation in the country.

The sources, who asked not to be named because of the sensitive nature of the matter, said government resorted to that drastic decision to end the vicious cycle of fuel scarcity crises and avoid subsidy payments.

Unlike the situation in 2012, the sources said government appeared to have successfully wooed organised labour and its affiliate unions to its side.

That claim could not be independently verified by PREMIUM TIMES. The General Secretary of the Nigeria Labour Congress, NLC, Peter Ozo-Eson, said he was unable to respond to the reporter’s enquiries, as he was in a meeting. He did not also respond to the text message sent to his telephone on Sunday.

Also, , the acting Executive Secretary, PPPRA, Sotonye Iyoyo, did not respond to calls, and a text message.

Insiders well briefed on the matter said top level secret meetings had been going on all week to weigh the security implications of the possible fallouts of the policy.

One of the meetings was held at the headquarters of the State Security Service in Abuja where the Minister of State for Petroleum Resources, Ibe Kachikwu, and his counterpart in the Ministry of Labour and Employment, Chris Ngige,  met with heads of security agencies to finetune possible security response should Nigerians pour into the streets to protest the policy.

Official spokespersons for key petroleum industry agencies were evasive when asked for comments Sunday afternoon.

NNPC spokesperson, Garbadeen Mohammed, said reports of the planned introduction of deregulation by government was new to him.

Full deregulation policy, which involves opening up the downstream petroleum industry for participation by all players, particularly the private sector, is widely considered the panacea for the incessant fuel supply crisis in the country.

With full deregulation, there will be fair competition, with the burden of petroleum products supply and distribution shared between private investors and government, with both having equal access to all aspects of industry operations, ranging from refining, sourcing, to marketing and distribution.

While government will continue to  monitor and enforce compliance with established standards, products pricing will be determined by the prevailing market forces in an atmosphere of competition.

Over the years, government bore the burden of subsidy payments on petroleum products consumed in the country.

Under the arrangement, landing cost of fuel, plus the distribution margins included in the Petroleum Product Pricing Regulatory Agency (PPPRA) pricing template have always imposed on government the extra burden of shouldering all costs in excess of a fixed retail pump price of N86 per litre as subsidy.

Until January this year when the price of crude oil at the international market dropped to less than $28 per barrel, government was paying subsidy in multiples of billions of Naira annually throughout the period of high oil prices.

With the introduction of price modulating mechanism by government, Nigerians experienced for the first time a situation where marketers had to refund to the PPPRA costs recovered for importing fuel at a landing price lower than government approved price band of N85.50 per litre for NNPC mega stations and N86 for other stations.

With crude oil prices gradually picking up in recent times, Nigerians have begun to hear reports of the return of subsidy payments by government.

A review of the latest PPPRA fuel pricing template for April 28 showed that retail price for petrol stood at N99.38, showig a fresh subsiďy level of between N12.08 and N13.08 per litre.

Our sources said government felt there was no better time than now to implement the decision, particularly when the price of crude oil, which stood at about $41 per barrel at the close of  trading on Friday, was still low.

In January 2012, the NLC successfully mobilized Nigerians to  shut down the country’s economy for five days to oppose the attempt by the Goodluck Jonathan administration to remove fuel subsidy, which resulted in hike in fuel prices nation wide.

That action by labour forced government to rescind its decision on the issue.


Source: Premium Times –

Lagos modular refinery to begin production next year



The Integrated Oil and Gas Limited has confirmed that its 20,000 bpd modular refinery is on course and will be coming on stream in 2017.

Manager, Media Relations/Corporate Affairs, Enyeribe Anyanwu, in a statement said: “The modular refinery which is located at Tomaro Island off the coast of Apapa port zone is expected to come on stream next year,”

Emerging from an environmental screening meeting with the Environment Unit of the Department of Petroleum Resources (DPR), the technical partners/engineering consultants and the environmental impact assessment consultant, Tayo Ogunbanjo, Chief Executive Officer of Integrated Oil & Gas Limited, Emmanuel Iheanacho, said every necessary step was being taken to ensure that the refinery was delivered on schedule.

Iheanacho said the meeting was part of the imperatives for the acquisition of the Environmental Impact Assessment Report (ESR) and other approvals for the refinery.

According to him, the meeting looked at the Front End Engineering Designs (FEED) of the refinery where the Crude Distillation Unit (CDU) was explained and analysed to the DPR.

He said after all the loose ends and every environmental concerns have been addressed, the company would get the EIA report.

The next stage, he explained, would be the presentation of the Detailed Engineering Design for final screening and approval after which the company would apply for the approval to construct from the DPR.

Ogunbanjo who is driving Eko Petrochem & Refining, the special purpose company that is handling the greenfield refinery project for Integrated Oil & Gas, said the company is not leaving any stone unturned in its determination to enhance the refining capacity of Nigeria and save the citizens the agony of perennial fuel scarcity and unnecessary depletion of the foreign reserves.

Environment Manager, DPR, Adeniyi Balogun, expressed satisfaction with the progress of work on the refinery project.

He said as soon as the company and its consultants addressed some issues raised by the DPR team to the workshop and satisfy other requirements as demanded by the nation’s environmental laws, the approval to begin physical work on the project would be given by the DPR.

He said the Federal Government is quite desirous of having private refineries in order to end the problem of fuel importation and its associated depletion of the nation’s scarce foreign exchange and has therefore told all the approving and regulatory authorities to ensure that unnecessary impediments are removed for the private refineries to be established.

Integrated Oil & Gas is a frontline independent downstream oil and gas company in Nigeria involved in the importation, storage and distribution of clean petroleum products.

The company presently operates two tank farms in Apapa, Lagos with a combined capacity of 85 million cubic litres and is currently developing new state-of-the-art tank farm facilities in Kano and Calabar.



Nigeria starts crude oil production in Lagos




A Nigerian firm has said it has started oil production from an offshore field in the commercial city of Lagos, the first output outside the country’s oil hub in the Niger Delta.

“Yinka Folawiyo Petroleum Co. Ltd (YFP) is pleased to announce that it has commenced production of crude oil from its Aje field located in block OML 113 offshore Lagos,” it said late Tuesday.

YFP did not disclose the volume of current output from the field but said the company has capacity to produce 40,000 barrels per day.

“Oil produced from the Aje field will be stored on the Front Puffin which has production capacity of 40,000 barrels of oil per day and storage capacity of 750,000 barrels,” it added in a statement.

Production began after more than 25 years of exploratory, appraisal and developmental activities in the field, making Lagos — Nigeria’s commercial capital — an oil-producing state.

Nigeria’s oil and gas industry is concentrated in the southern delta states but the region has been dogged by unrest and disruption from militants demanding a fairer share of revenue.

Pipeline attacks and illegal refining or “bunkering” as it is called locally have hit output, which is currently estimated at about 1.8 million barrels a day, according to OPEC.

Nigeria is reliant on oil revenue for its economy but crude earnings have been depleted drastically since the slump in global prices that started in mid-2014.



How Nigeria Can Stop Oil, Gas Pipelines From Bleeding



The expenditure of about N103.4 billion for pipeline repairs and management between January and December 2015 has been described by experts as resource waste. CHIKA IZUORA gets their view on how to manage such assets.

Stakeholders in the oil and gas sector have considered as a monumental waste the huge funds appropriated for pipeline repairs following the unabated collateral damage inflicted on them by vandals as  it is becoming a tough task for security agencies to deal with the problem.

Oil production data reported by Platts showed that oil output from Nigeria fell by 20,000 barrels per day in February to 1.75 million barrels as exports and production of popular crude grade Forcados continued to be shut in due to sabotage-related spill on the subsea Forcados pipeline.

Also, in late March, the National Oil Spill Detection and Response Agency (NOSDRA) confirmed a blast at an oil field operated by Nigeria Agip Oil Company (NAOC) in Bayelsa State, killing three maintenance workers repairing crude oil pipelines at Olugboro in the Southern Ijaw local government area of the state.

All of these points to increasing act of sabotage perpetrated by persons suspected to be Niger Delta militants. Experts see it as a near impossible task for the Nigerian National Petroleum Corporation (NNPC) to operate its refineries, crude oil and products pipelines profitably except steps are taken to eliminate all acts of pipeline vandalism.

The chairman and chief executive of Collintox Nigeria, Hammed Kadiri, told LEADERSHIP that a proactive measure is required at this time to deal with the situation. Kadiri, an energy asset security expert, who is also into due diligence and business intelligence, said that a holistic approach is needed given that the act has various dimensions to it.

According to him, “When we talk of pipeline vandalisation, there are various angles to look at it. First of all, let’s look at the commitment of government in securing the facilities. What is the standard of living of people who live in these environs. When I talk about the commitment of government, have we been able to put enough security apparatus in place to ensure that these pipelines are safe? If there is that political will on the part of the government to ensure that pipelines are safe I do not think that we will have so much challenges in terms of securing them. Again when I speak on the standard of living what I am trying to highlight is that most of the time when you go to the villages where these pipes run through you will find that the people live below the poverty line.

“What do you expect from a man who has a wife and children to take care of but cannot, and he sees these pipelines running through his neighbourhood and knows that if he is able to break or flout the law he can get products which when sold he can feed his family from the proceeds? I’m not saying that it is good to break the law, there is no reason for anybody to break the law but we should not give people excuse to do that,” Kadiri said, insisting that an enabling environment for people who lives in this environ is key so that they do not see the destruction of pipelines as a means of living.

He also deplored the use of soldiers as solution to the problem.

“In todays world, security doesn’t have to be a show of force, technology has made it such that with apparent minimum supervision, we will be able to safeguard these pipelines. Now, given the sort of environment we live in it is acceptable use physical security, which is what the soldiers represent. Aside from the physical security, what technical support have we put in place to run side by side the soldiers we have put in place? When we talk of technology, we are talking about cameras, high tech security cameras along the corridors of which the pipelines run through,” he said.

However, all these are coming in the light of a report titled “Report on Improving Local Refining Capacity in Nigeria,” prepared by the managing director, Matwims Consult Limited, Mark Tubotein, which revealled that the repeated repairs by the Petroleum Pipelines and Marketing Company (PPMC) after each act of vandalism for several years calls to question the integrity of existing pipelines that are over 35 years in operation without adequate maintenance.

This is because despite spending N103.4 billion for pipeline repairs and management between January and December 2015, data from the NNPC shows that the federal government actually recorded crude oil and product losses to the tune of N57.71 billion to pipeline vandalism. He noted that reports from the NNPC reveal that as from January to August 2015 alone, there have been over 1,824 cases of line breaks on the PPMC pipelines.

“The corporation, at least, spends billions of naira each year to maintain and secure pipelines with the assistance of security personnel and community personnel in the Niger Delta,” Tubotein said.

Due to the series of pipeline vandalism, Nigeria has suffered setbacks in meeting its gas obligation to Ghana and other West African countries through the West Africa Gas Pipeline Company.  To avert throwing the country into darkness, the government of Ghana has already started making alternative arrangements to get gas in order to provide regular electricity which has been epileptic for several months due to the deficit in Nigeria’s supply.



Falling output and weaker dollar push oil to 2016 high

Oil hit its highest level of 2016 on Wednesday, driven by a falling dollar and evidence of declining U.S. supply, putting the price on course for its strongest monthly performance since last April.

The prospect of an agreement among the world’s largest exporters to limit production, which had provided the catalyst for a 55 percent rally since mid-February, evaporated almost two weeks ago when a meeting between OPEC members and their non-OPEC counterparts ended in stalemate.

Since then, Brent has hit its highest since November and, aided by further evidence of declining output anywhere from the U.S. shale basin to the North Sea, attracted fresh investment cash. [O/ICE] [CFTC/]

“There was definitely a bit of a turning point when we had the initial sell-off after the producer meeting,” CMC Markets strategist Jasper Lawler said.

“That got reversed and went on to show that (a production freeze) was a fairly small part of what had been supporting the price and really, it’s the supply outlook for the U.S. coupled with the dollar that is really driving returns.”

Brent crude futures LCOc1 were up 88 cents at $46.62 a barrel at 1135 GMT, having hit a 2016 high of $46.81, while U.S. crude futures CLc1 rose 80 cents to $44.84 a barrel.

Brent received extra support from news that Saudi Arabia and Kuwait appear no closer to restarting their jointly operated Khafji oilfield, which produced 280,000 to 300,000 barrels per day before environmental problems forced a closure in October 2014.

WTI was further bolstered after the American Petroleum Institute reported a draw of nearly 1.1 million barrels in U.S. crude inventories last week. Analysts had expected a 2.4-million-barrel build.

The dollar was down on the day, having fallen about 5 percent against a basket of currencies .DXY since the start of the year, even as U.S. interest rates are expected to rise.

The Federal Reserve’s policy-setting committee meets on Wednesday but is not expected to announce any change in rates, leaving traders to scour the post-meeting statement for any clues on the outlook.

A weaker dollar cuts the cost to non-U.S. investors of buying dollar-denominated assets such as oil futures.

Yet analysts were cautious about forecasting further gains in the near future.

“Despite speculative overheating, any news that could suggest a higher price is viewed as a good reason to buy …We meanwhile see worrying parallels to 2015, when oil prices rose sharply well into May before collapsing in the second half of the year,” Commerzbank analysts said in a note.
*Amanda Cooper & Henning Gloystein; editing – Dale Hudson & Jason Neely – Reuters