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 – https://www.today.ng/news/national/122359/labour-unites-buhari-vows-shut-nigeria

 

 

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

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

 

– Petrol deregulation to affect other sectors of the economy

– The IMF, World Bank roles

– Experts list what to expect from President Buhari

As expected, Nigeria will remain tensed in the coming days. This is because of the sudden reality that the government would not renege in its decision to liberalise the premium motor spirit, also called petrol.

With the announcement on Wednesday by Emmanuel Ibe Kachikwu, the minister of state for petroleum, Nigerians should be prepared for the following:

1. Protests The decision to deregulate petrol has torn Nigeria into those for and those against the removal of subsidy. On social media, those who are angry have begun mobilisation for a re-enactment of the 2012 #occupyNigeria which almost claimed the country. Share on Facebook Share on Twitter An oil refinery. Surprisingly however, most of those who partook in the 2012 edition may not likely be active this time. REFINERY

2. Increased agitation by organised labour The time has come for the Nigeria Labour Congress and the Trade Union Congress to consolidate on their agitation for an increment in the minimum wage of the country’s workers. READ ALSO: Subsidy removal: Buhari, APC get new names from Fayose Currently the minimum wage is N18,000 and labour recently demanded for N56,000, an amount the government says it is still considering.

 

3. Commendation from IMF, WORLD BANK The duo of the International Monetary Fund (IMF) and the World Bank may have won in the call for Nigeria to carry out full deregulation sector as well as remove subsidy.

 

4. Sale of refineries Nigeria has four refineries which have gulped billions of dollars in maintenance, yet have not met expectation. It has always been sad news of low output. As reported, Kachikwu says Nigeria is currently speaking with Total, Chevron and Agip to see how a partnership deal could be struck concerning the refineries.

 

5. Passage of petroleum industry bill With the deregulation of premium motor spirit, the National Assembly could now be motivated to pass the petroleum industry bill to now give total deregulation to the sector.

 

6. Naira devaluation Did you just say it is not possible? In Nigeria, anything is. After all, President Muhammadu Buhari, in 2015, argued that it was not the best to increase pump price because it would affect other sub-sectors of the economy. READ ALSO: Fuel price increase: Omokri criticises Buhari, Osinbajo He has also constantly argued that there was no serious reason to devalue the naira, but Nigeria is currently facing two-digit inflation and the citizens are not smiling.

 

7. Delayed economic recovery Though Kachikwu has promised that the price of petrol would stabilise in about six months, many still believe that the economy will take time to recover, especially with a president who believes in ‘slow and steady’. NAIJ.com had earlier reported that the announced removal of subsidy on the premium motor spirit, popularly called petrol, on Wednesday, may end up becoming a re-enactment of the January 2012 #occupyNigeria, as some agitated citizens have commenced a new campaign to have it repeated against the government of President Muhammadu Buhari. With the removal of subsidy on the product, the government fixed N145 as the maximum amount to be charged per litre on petrol and while some Nigerians are mobilising on social media for mass protest, the Trade Union Congress (TUC) thinks the fuel price hike was a coup against organised labour.

Read more: https://www.naij.com/828855-7-challenges-nigerians-will-face-petrol-deregulation-begins-no-6-will-affect-everybody.html

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.”

Read more at: http://www.vanguardngr.com/2016/05/fg-increased-petrol-pump-price-n145-per-litre-kachikwu/

 

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.

 

Technology key to firms’ survival in low oil price regime

 

For oil and gas stakeholders who gathered at the just concluded Offshore Technology Conference (OTC) in Houston Texas, by implementing technological solutions, the industry will be able to retain a high level of production and at much lower costs.

Along with the high-tech displays and gee-whiz presentations that highlighted the yearly event, the conference featured sessions on how to reduce operating expenses and extend the lives of aging oil and gas fields.

OTC Chairman, Joe Fowler stated that many of the 300 papers presented focused on techniques and equipment to bring down the high cost of offshore drilling to make it more competitive in a low-price environment.

More than 68,000 attendees from 120 countries gathered at the yearly conference, placing 2016’s OTC among the top 15 highest attended in its 48-year history.

Speaking at the event, the Chairman of PETAN, Mazi Bank-Anthony Okoroafor, emphasized the need for oil and gas operators to invest in technological advancement to effect cost reduction.

He also stressed the need for focus to be placed on existing in-country capacity instead of patronage.

He added that the country should actively pursue reserves and production growth, which he said, has been on the decline.

Okoroafor emphasized on leveraging proven Nigerian companies and in-country capacity building, adding that proper implementation of the Nigerian oil and gas industry content development will significantly drive down the cost of doing business in the oil industry and cushion the effects of the low prices.

He stated: “The industry has operated under the local content Act regime for six years now, there is the need to take a closer look at the implementation strategy to ensure it is delivering the desired value to various industry stakeholders in particular and the Nigerian populace in general, proper implementation of local content will lead to massive economic transformation of our great nation”.

Chairman, PETAN Conference Committee, Ranti Omole, stated that based on the belief of indigenous companies, the association is partnering to reduce cost of operations and projects in Nigeria through increased local patronage.

He stated: “The industry has been undergoing challenging and turbulent period for the past two years due to low prices of crude oil and low demand. This has resulted in severe adverse consequences in the industry as well as on the economy of many oil producing nations including our country. This has led major players in the industry to rationalize their operations, seek efficiencies and cost saving measures to ensure profitability and survival of their businesses.”

The Acting Executive Secretary, Nigerian Content Development and Monitoring Board, Daziba Obah, said with the right support and environment, indigenous companies are best positioned to provide services and process at most lower cost without compromise to standards.

Obah added that there is opportunity to leverage the low value of the naira to source services, technology and solutions local at much cheaper cost.

He noted that there will be much more cost savings if operators develop increased project management capabilities to manage projects. “Operators will save costs by optimizing existing facilities and improving maintenance efficiencies.

Dwelling on the role of the Federal Government to help save the indigenous companies from the pangs of crude oil prices, former Chairman of PETAN, Emeka Ene, he said that there is need to develop the steel sector for local production of steel billets, coils and plates.

Ene added that government should accelerate gas infrastructure along source corridors to ease availability of the commodity in oil and gas parks, oil and gas free zones and other manufacturing locations supporting oil and gas activities.

He stated: “There is need to engage relevant agencies to foster cordial and seamless working relationship with respect to expatriate quota and issuance of work permit. There should also be a periodic industry-wide capacity audit of local companies to establish current capacities and embark on gap closure interventions. Research and development clusters should be encouraged to promote the development of home grown technology”.

Source: Today.NG – https://www.today.ng/business/120138/technology-key-firms-survival-low-oil-price-regime