Oil exploration causes environmental warming in Nigeria – NGO



Oil exploration causes environmental warming in Nigeria – NGO


Health of Mother Earth Foundation (HOMEF), a Non-Governmental Organisation (NGO), said oil exploration by multinational companies was a major contributor to environmental warming and climate change effects in Nigeria.

Coordinator of the organisation, Mr Nnimo Bassey, stated this on Sunday at an environmental awareness campaign tagged “Break Free 2016” in Ibeno, Akwa Ibom.

He said that exploitation of crude oil and flaring of gas had destroyed the ecosystem thereby causing environmental warming in the country.

“We can break free from fossil fuel; we cannot keep on burning fossil fuel and the oil companies knew many years ago that oil extraction causes global warming,” Bassey said.

He said that the spread of chemical in the ocean during oil spills had affected fishing activities in the parts of the country.

According to him, the polluted water has affected the quality and quantity of fish in the ocean.

“It is happening in 15 countries around the world; everybody is saying the use of crude oil, the use of crude, the use of gas is destroying the planet.

“It makes the planet to change, everywhere is hot; it is because when oil is burning, it pollutes the air as the weather is changing,” Bassey said.

He alleged that a scientific study sponsored by a multinational in the area had proved that oil exploration was detrimental to human health and the environment.

“They paid scientists to hide the information so that they can make profits in dollars now that the information is coming out in the USA,” Bassey alleged.

He called on the multinational companies to the leave the oil in the soil, saying that 80 per cent of the chemical kept in the soil had polluted the ocean.

Also speaking, Executive Director, Peace Point Action (PPA), another NGO, Mr Umo Isua-Ikoh, said that residents of oil-bearing communities were suffering from respiratory and skin diseases.

Ikoh attributed the situation to breathing of poisonous gases emitted into the air through oil exploration and extraction activities in the area.

He said that the objective of the awareness campaign was to stop the impunity committed in the Niger Delta by the oil multinational companies.

“If we are sincere about doing our part to fight climate change, then we must leave the oil and gas in the soil,” Ikoh said.

He said that oil and gas companies were sacrificing peoples’ lives and future of children “at the altar of profit’’ and that governments in the country had “unfortunately, become their bedfellows’’.

“Our roofs top wear and tear very fast because of acid rain. Companies around continue to flare gas with impunity in spite of several targets to end gas flaring.

“We want to see an end to gas flaring in the Niger Delta region,” Ikoh emphasised.

He claimed that though Akwa Ibom had been the highest oil producing state in Nigeria, it had the worst socio-economic indicators in the Niger Delta.

According to him, oil wealth does not directly translate to wealth and sustainable development for the people.

“The truth is that oil and gas exploration and production has left in its wake only environmental disaster, time bomb, poverty, disease and conflict in the region,” Ikoh said.

In his remarks, a former Chief Medical Superintendent in the state, Dr Charles Abakam, decried the state of devastation of the environment in Ibeno Local Government Area by oil extraction activities.

Abakam said that people living in an environment where oil was exploited had the tendency to develop prostate cancer.

He said that apart from destroying the ecosystem, oil exploration was injurious to the health of the people in the oil producing areas and called for cessation of oil extraction.

Source: Today.NG – https://www.today.ng/news/national/122557/oil-exploration-environmental-warming-nigeria-ngo

Subsidy removal saves govt N16.4bn monthly – Kachikwu



Subsidy removal saves govt N16.4bn monthly – Kachikwu

Dr. Emmanuel Ibe Kachikwu

The Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu, has said the federal government would have had to shop for N16.4 billion every month to offset subsidy claims of petrol marketers if it had not taken the decision to remove subsidy on fuel consumption.

Kachikwu explained in a tweet on his twitter handle @ibekachikwu that as at the time the government made the decision to end subsidy on petrol and subsequently hiked the pump price, it was incurring about N13.7k as subsidy on each litre of petrol bought by Nigerians.

He said at such rate, government would have paid out N16.4 billion to marketers monthly, adding that the government does not have such fund in its 2016 budget, more so now that the country’s earning from crude oil production has dropped.

THISDAY monitored the minister’s tweet weekend in Abuja where he tried to justify the new framework for petroleum supply, distribution and pricing. He also listed the benefits of the new policy.

“There is no provision for subsidy in 2016 appropriation. As at today, the current PMS price of N86.50 gives an estimated subsidy claim of N13.7 per litre which translates to N16.4 billion monthly. There is no funding or appropriation to cover this,” said the minister in the tweet.

He further stated: “NNPC has continued to utilise crude oil volumes outside the 445,000 barrels per day, thereby creating major funding and remittances gaps into the federation account.”

Kachikwu also said renewed insurgency and pipeline breaks in the Niger Delta has resulted to Nigeria’s daily crude oil production dropping to 1.65 million barrels per day (mbpd) as against the 2.2mbpd that was projected in the 2016 budget.

He said this has reduced government’s earnings and foreign exchange build ups to perhaps support subsidy on importation of petrol into the country.

He equally listed the benefits of the new policy, saying that going forward, 100 per cent payment to the federation account on the allocated 445,000bpd of crude oil to the Nigerian National Petroleum Corporation (NNPC) would be assured and tailored to provide palliative measures for the country.

He also said the policy will encourage market stability in the downstream petroleum sector; stabilise fuel supply in the country; discourage hoarding of products and reignite investors’ interests in setting up refineries in the country to cut importation of petroleum products.

Meanwhile a former energy and mines minister of Venezuela, Dr. Alirio Parra has described the recent decision of the government on Nigeria’s downstream petroleum sector as historic and smart.

Parra who is also a member of the global oil industry outfit, CWC Group, stated at a forum in Abuja over the weekend that the liberalisation of the downstream sector in the oil industry is a bold testament to the fact that oil is a market-driven commodity.

A statement from the Group General Manager, Public Affairs of the Nigerian National Petroleum Corporation (NNPC), Mallam Garuba Deen Muhammad stated this.

According to Parra in the statement: “One really important change in the oil and gas industry in Nigeria is the decision by the federal government to open the domestic market for competition.

“I am not necessarily talking about the elimination of subsidy, but opening the market, is a statement that oil is market driven and that with time, it is going to be to the benefit of Nigeria, and to all Nigerians.”

He further stated that the opening of the market will in no time encourage more players to bring in petrol which would eventually lead to a new era of competitive pricing.

Source: Today.NG – https://www.today.ng/news/national/122684/subsidy-removal-saves-govt-n16-4bn-monthly-kachikwu

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.


Source: https://www.today.ng/news/national/116366/lagos-modular-refinery-production-year

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.


Source: https://www.today.ng/business/116503/nigeria-starts-crude-oil-production-lagos

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.


Source:  http://www.nigeriatoday.ng/2016/04/how-nigeria-can-stop-oil-gas-pipelines-from-bleeding/

Nigeria’s recurring economic crisis

ALL societies normally strive for survival and growth. This is with a view to improving the life chances of their people, through the purposeful exploitation of their endowment. The ultimate goal is the creation of better access to means and standards of livelihood for the people, for whom these endowments exist. The orderliness and proper management of societal structures which will provide the enabling environment for the citizenry to engage in lawful economic activities is of utmost importance towards achieving these goals.

Towards this end, the government, whose duty it is, to protect the citizens and help harness societal resources for their benefit is expected to identify and continually update its knowledge about the needs and preference of the people. The aim of course, is to ensure the design and implementation of demand-driven policies and programmes, in consonance with the wishes of the people.

Unfortunately, Nigeria’s experience in the last 50 years is a mixed grill of more failures than successes. The last straw was the last six years (2009-2015) when bad behaviour at all levels, of both public and private sectors graduated from bribery, corruption and illegal enrichment to outright stealing. But to fashion a way forward out of the current economic crisis, it is important to take a retrospective look at where we are coming from. This throws up the fun­damental questions: How did we get where we are now? What lessons, if any, have we learnt? And what are the chances that we will ensure that we utilize to­day’s opportunities to get us to the ‘promised land’?

The answers are not far-fetched. For instance, be­fore independence in 1960 Nigerian economy was characterized by the dominance of exports and com­mercial activities. The industrial sector was virtually non-existent. Raw materials, comprising agricultural produce and minerals were exported to the industrialized na­tions. This continued into the pre-oil boom era (1960-1970) when agriculture contributed about 65 per cent of the GDP and represented almost 70 per cent of total exports. Indeed, agriculture provided the foreign exchange needed to import raw materials and capital goods. The peasant farmers pro­duced enough to feed the entire nation.

It was during this period that the First National Plan (1962- 68) was put together. Its overriding objective and that of the subsequent ones-2nd, 3rd and 4th (1970-85) was to achieve a rapid increase in the standard of living of the average Ni­gerian and put Nigeria on the list of developed countries in the world. Specifically, the short-term plans were meant to increase income-per-capita, ensure more even distribution of income, reduce the level of unemployment and increase the supply of high level manpower. Others included the diver­sification of the economy, guarantee balanced development and the indigenization of economic activity.

Good enough, the oil boom era came. The discovery of oil in the mid-fifties however, created serious structural problems in the economy. In 1971, the share of agriculture to GDP was 48 per cent. But some six years later in 1977 it had declined by over 50 per cent to 21 per cent. The contribution of oil to the economy was 90 per cent of the GDP and 85 per cent of total exports. Sadly, by 1974 Nigeria had become a net importer of basic food items! Food production became a problem as rural-urban migration increased. On the flip side, foreign exchange was no longer a constraint to development. Government, therefore, got involved in virtually all aspects of the economy, including ownership and control of critical sectors such as petroleum, mining, banking, insurance, clear­ing and forwarding.

Before long, the era threw up its own challenges. Corrup­tion, theft, real estate speculation, outright looting of gov­ernment treasury and other fraudulent practices prevailed. Private accumulation of ill-gotten wealth intensified. The gap between the rich and the poor widened. The economy became heavily dependent on imports. It was, therefore, not too surprising that the private sector remained weak despite the oil boom. The economy registered negative growth be­tween 1978 and 1986, except in 1979 and 1985. Inflation and unemployment rates escalated. Yet, the auster­ity measures adopted by the Obasanjo/Shagari re­gimes did not arrest the deepening economic crisis. External loans increased. Industrial capacity utiliza­tion declined from 74 % in 1981 to 31% in 1989. Manufacturing growth reduced from 15% in 1981 to 3% in 1989. It was so bad that restructuring the economy was inevitable.

Yet, the Structural Adjustment Programme (SAP) introduced in 1986, which emphasized privatiza­tion, reduced government expenditures, adoption of a realistic exchange rate policy, reliance on market forces, adoption of appropriate pricing policies for petroleum products and public enterprises did not meet its lofty objectives. The private sector that was meant to serve as an engine of growth was unable to respond adequately to achieve increased produc­tion, create employment and stabilize prices.

But instead of heaving a sigh of relief, Nigeria’s economic crisis worsened with the global finan­cial meltdown of 2007-2008, the worst since the General Depression of the 1930s.The stock market crashed. The banking sector had 10 out of the 24 banks grappling with non-performing loans, poor corporate governance and weakness in capital ad­equacy and illiquidity. There was drastic decline in revenue receipts by the three tiers of government. Hope seems dimmed with the global crash of oil prices and Nigeria losing 40 per cent of oil revenue that used to come from the United States. Russia has kept going despite its internal crisis. Canada and Iraqi oil production and exports have risen.

The interplay of this scenario has led to 50 per cent fall in the value of our local currency, the Naira. Revenues from oil exports, non-oil exports and pri­vate remittances from abroad and foreign direct in­vestment (FDI) fell. All be it, the current economic challenge is the last opportunity to get it right.

. An excerpt of a lecture delivered by Mr. Joshua Ajayi, the former MD of UAC, at Bells University, Ota COLAMS Annual Lecture

First oil produced from SNEPCO-operated Bonga North West deep-water project in Nigeria

bonga fpso


Shell’s deep-water subsidiary in Nigeria, Shell Nigeria Exploration and Production Company Ltd (SNEPCo) started oil production from the first well at the Bonga North West deep-water development off the Nigerian coast on Tuesday 5 August 2014, another milestone for the country’s energy industry. “This is an excellent addition to our deep-water portfolio – a key growth theme for Shell’s world-wide upstream business,” said Andrew Brown, Shell’s Upstream International Director. “It’s also good news for Nigeria, as it is a new source of oil revenues and strengthens Nigeria’s deep-water expertise, a key driver of economic development.” The Bonga project, which began producing oil and gas in 2005, was Nigeria’s first deep-water development in water depths over 1,000 metres. Bonga North West represents a significant step forward for the project. Oil from the Bonga North West sub-sea facilities is transported by a new undersea pipeline to the existing Bonga floating production, storage and offloading (FPSO) export facility. The Bonga FPSO has been upgraded to handle the additional oil flow from Bonga North West which, at peak production, is expected to contribute 40,000 barrels of oil equivalent per day, helping to maintain the facility’s overall output. Four oil producing wells and two water injection wells in the Bonga North West development will be connected to the FPSO, from where oil is loaded onto tankers for shipping around the world. The Bonga North West project is part of Shell’s long-standing commitment to developing deep-water engineering skills in Nigeria. The investments made by SNEPCo and its other project partners in the Bonga North West project include upgrades of local contractors’ facilities and providing specialised training for Nigerians to work in the energy industry. The Bonga project is operated by SNEPCo, which holds a 55% stake. The other project partners are Esso Exploration & Production Nigeria (Deepwater) Limited (20%), Total E&P Nigeria Limited (12.5%) and Nigerian Agip Exploration Limited (12.5%) under a Production Sharing Contract with the Nigerian National Petroleum Corporation.


Source: http://www.shell.com