Oil & Energy

As Jonathan Demystifies Power Sector

Published

16 years ago

January 31, 2011

When nine months ago President Goodluck Jonathan assumed office and assigned to himself the position of Minister of Power, not many Nigerians were excited. Their skeptism hinged on the obvious reason that in the past, both General Sani Abacha and Chief Olusegun Obasanjo took similar steps during their respective regimes by appropriating to themselves the position of Petroleum Minister, yet no concrete results were achieved in the petroleum sector.

Pundits were of the view that Jonathan’s appropriating the Minister of Power Portfolio to himself would not revive the ailing power sector as they regarded the step as mere government rhetorics.

The power sector was already characterized by very low generation capacity, poor distribution network and a fragile limited transmission network. The multinational oil companies responsible for gas supply to the nation’s power station in joint venture with the Nigerian National Petroleum Corporation (NNPC) were unable to supply gas as the militancy that ravaged oil activities in the oil-rich Niger Delta region led to blowing up of strategic oil and gas pipelines. The situation resulted in the power plants either being shut down while few functional ones were producing far below capacity. The resultant effect was that most Nigerians groped in darkness and scores of companies whose operations were frustrated as a result of high cost of alternative power supply left the country for other West African countries.

Added to the situation was the fact that efforts by Chief Olusegun Obasanjo and Alhaji Musa Yar’Adua to revive the ailing power sector suffered failure inspite of huge funds invested. The much touted 6,000 megawatts targeted by Yar’Adua in 2010 also failed. The question that was in the lips of must Nigerians then was what magic approach would President Jonathan adopt to revive the dying power sector?

However, not deterred by the challenge, Jonathan took some proactive and far-reaching measures to give a breathe of life to the nation’s powerless power sector. He sort for and appointed high brow professionals with enviable record to confront the challenges in the sector. He appointed Prof Bart Nnaji as his Special Adviser on Power and also created some committees on power.

To address the gas supply challenge, the Presidency summoned the management of the multinational oil companies and NNPC and they reached an accord on the strategies to supply adequate gas needed to energise the power stations.

After casting a wide look at the sector, according to Prof. Nnaji, Federal Government came to the realization that Nigeria’s electricity infrastructure needs are enormous such that government alone cannot meet these needs, hence the urgency to involve the private sector.

In his paper, “The Role of the Private Sector and Structured Financing in Solving Nigeria’s Power Supply Problems”, delivered at an International Power Roundtable organized by the Rivers State House of Assembly Committee on Power last year, the Special Adviser to the President on Power said only about 40% Nigerians have access to electricity supply and that to meet the electricity demand of the nation’ by 2020, distribution network has to grow at the rate of at least 6% each year against the current average growth rate per annum estimated below 1%.

On the large funding required, Prof Nnaji said about $50 billion was required over the next ten years. “Government capital outlays for all capital budget is $5 billion annually meaning that annual funding requirement has outstripped the capacity of government funding”, he regretted.

The Federal Government has no option than to let go its monopoly on electric supply and opened its door widely for both local and foreign private investors. The government has offered prospective investors in the power sector a five-year tax holiday to serve as an incentive to woo them.

To achieve same goal, Bureau of Public Enterprises (BPE) has commenced road shows in Lagos to enlighten investors on opportunities in the sector. BPE said apart from the five-year tax holiday, another incentive for investors in the sector is the World Bank’s instruments to insure their investment against political risks in the country and assured investors of a cost-reflective tariff system.

Aside the Lagos event, meetings are scheduled to be held with investors in Dubai, United Arab Emirates’ on January 24; London, United Kingdom on January 27; New York, United States on February 1 and Johannesburg, South Africa, on February 11. This came ahead of a February 18 deadline for the expression of interest in the eleven distribution companies, four thermal generating firms and two hydro power stations in Nigeria.

The eleven distribution companies which investors are expected to express their interest in include Port Harcourt Distribution Company Plc, Abuja Electricity Distribution Company Plc, Benin Electricity Distribution Company Plc, Enugu Electricity Distribution Company Plc, Eko Electricity Distribution Company Plc and Ibadan Electricity Distribution Company Plc.

Others are Ikeja Electricity Distribution Company Plc, Jos Electricity Distribution Company Plc, Kaduna Electricity Distribution Company Plc, Kaduna Electricity Distribution Company Plc, Kano Electricity Distribution Company Plc and Yola Electricity Distribution Company Plc.

The four thermal generating stations which investors are expected to show interest are Afam Power Plc, Sapele Power Plc, Ughelli Power Plc and Geregu Power Plc while the two hydro power stations are Kainji Power Plc, including Jebba Power station and Shiroro Power Plc which government intends to give out to private investors under a concession arrangement.

According to Minister of State for Power, Mr Nuhu Wya, the forum in Lagos was organized to showcase numerous opportunities available in Nigeria’s Power sector.

Inspite of the fact that most government efforts are at early stages, the administration of Goodluck Jonathan has already recorded some humble achievements. The meeting between Federal Government and oil multinationals over gas supply has yielded fruits as Nigeria National Petroleum Corporation said it has already surpassed its gas supply obligation to power stations across the country, in line with Federal Government’s aspiration.

The group managing director, Engr Austen Oniwon disclosed this to newsmen in Abuja and added that NNPC has also taken proactive measures to ensure sufficient gas supply to the new ones under construction upon completion.

At present power generation in the country has risen to 3,800 megawatts. Analysts view this as very impressive considering the fact that generation was below 2,700 mega watts when President Jonathan assumed office. Minister of States for Power, Mr Nuhu Way promised that by the end of this quarter, generation will get to 4,000 megawatts.

It is obvious that when the action plans come to full swing, the nation will hopefully actualize its dream of stable power supply which has eluded it for decades.

Nigerians have attested to the fact that power supply has improved in all parts of the country compared.

However, the agitation by staff of Power Holding Company of Nigeria (PHCN) over their 135% salary areas, casual status of alleged 10,000 workers and other welfare issues need to be addressed considering the fact that they are stakeholders in the reform agenda. Unfortunately, the electricity workers have dragged the government to Abuja High Court over the issue.

Sabotage by electricity workers who connive with criminals to remove power facilities may affect the new effort of the government. Similarly the issue of estimated metering adopted by PHCN workers do not guarantee transparency. Experts are of the view that credit card system be adopted as is the case in Telecommunication sub sector.

Another area that also needs to be addressed is the award of rural electrification projects to portfolio carrying politicians who either abandon such projects or execute them at substandard level.

There is need for the Federal Government to fast track investigations on allegations of fraud which runs into billion over past power projects.

Be it as it may, Goodluck Jonathan has shown that the power challenges which affect socio-economic lives in Nigeria can be tackled as his efforts has renewed hope of Nigerians.

Chris Oluoh

Oil & Energy

Global Coal Consumption Hits Record Even As Coal Power Declines

Published

15 hours ago

August 3, 2026

The Tide

Global coal consumption reached another record in 2025, seemingly contradicting years of discussion about phasing out the world’s most carbon-intensive fossil fuel.

But the headline number does not tell the whole story.

The latest Statistical Review of World Energy shows that global coal consumption rose to 166.0 exajoules last year. That represented an increase of 0.7% from 2024.

At the same time, global electricity generation from coal declined. Coal-fired power production fell 0.3% to 10,511 terawatt-hours.

Those two trends are not mutually exclusive. Coal is used not only to generate electricity, but also in steelmaking, cement production, and other industrial processes. The divergence also reflects a changing geographic picture in which coal is declining across much of the developed world while remaining deeply embedded in Asia’s industrial economy.

A Record With Important Qualifications

Coal consumption reached a record in absolute terms, but it did not keep pace with overall energy demand.

Total global energy supply increased from 592.2 exajoules in 2024 to 600.3 exajoules in 2025, an increase of about 1.4%. Coal grew more slowly, so its share of the global energy mix slipped from 27.9% to 27.7%. Thus, despite the global record in coal consumption, coal lost a small amount of market share.

This pattern appears frequently during energy transitions. A fuel can continue growing in absolute terms even as faster-growing alternatives reduce its share of the total. With global energy demand still rising, losing market share does not necessarily mean declining consumption.

Renewable energy provides a relevant comparison. Renewable energy supply increased by nearly 10% in 2025, far outpacing coal. But the world’s appetite for energy was large enough to accommodate growth in renewables and another record for coal at the same time.

Coal Is Increasingly an Asian Fuel

The most striking feature of the coal market is its geographic concentration.

Asia Pacific consumed 138.1 exajoules of coal in 2025, accounting for 83.2% of the global total. China alone consumed 92.2 exajoules, or 55.6% of all the coal used in the world.

India contributed another 23.1 exajoules, representing 13.9% of global consumption. Together, China and India accounted for almost 70% of the world’s coal use. Add Indonesia, and the three countries consumed nearly 73% of the total.

This is why broad statements about a global coal phaseout can be misleading. Coal may be steadily retreating in Europe and North America, but its future is increasingly being determined in Asia.

Non-OECD countries accounted for 85.2% of global coal consumption in 2025. Their coal use has grown at an average annual rate of 1.9% over the past decade. OECD consumption, by contrast, has declined at an annual rate of 4.8%.

Europe consumed just 4.4% of the world’s coal last year. The European Union’s share was only 2.8%, following another 3.2% decline in consumption.

The global total therefore combines two very different stories. One is a long-term retreat from coal across much of the developed world. The other is coal’s continued importance to the large and growing economies of Asia.

One surprise in the 2025 data is that coal-fired electricity generation declined even as total coal consumption increased.

China generated 5,756 terawatt-hours of electricity from coal, down 1.1% from 2024. India’s coal generation fell 3.0% to 1,464 terawatt-hours. Since those two countries produce nearly 69% of the world’s coal-fired electricity, relatively small percentage declines can have a large effect on the global total.

Coal generation across Asia Pacific declined 1.2%, while Europe posted another 3.4% decrease. The European Union’s coal generation fell 3.6% and accounted for only 2.6% of the global total.

The divergence between consumption and power generation indicates that coal demand outside the electric power sector helped support the record. Coal consumption statistics include industrial uses that are not captured by electricity-generation totals. Changes in plant efficiency, coal quality, inventories, and measurement can also prevent the two series from moving in perfect alignment.

Whatever the precise combination, the result is notable. The world consumed a record amount of coal while producing less electricity from it.

The United States broke sharply with the broader developed-world trend in 2025.

U.S. coal consumption rose 10.4% to 8.7 exajoules. Coal-fired electricity generation jumped 13.1% to 804 terawatt-hours, while domestic coal production increased 4.4%.

In absolute terms, the increase in U.S. coal consumption was larger than the net increase for the entire world. U.S. consumption rose by about 0.8 exajoules, while the global total increased by roughly 0.7 exajoules. Declines in several other countries offset part of the American increase.

Still, this should not be mistaken for a return to coal’s former dominance in the United States.

U.S. coal consumption remains about 62% below its 2005 peak. Coal-fired generation is approximately 63% below its 2007 high, and production is about 54% below its 1998 peak.

The 2025 increase was substantial, but it occurred within a long-term structural decline. The United States still accounted for just 5.3% of global coal consumption and 7.7% of global coal-fired generation.

Global coal production remained near record levels at 180.8 exajoules, but it was essentially flat in 2025.

China increased production by 1.7% and supplied 52.4% of the world total. Its coal consumption was nearly unchanged, but its imports fell 10.1%. The combination suggests that increased domestic production displaced a meaningful amount of imported coal.

That shift helped push global coal trade down 3.1% to 35.3 exajoules. Indonesia, the world’s largest exporter, saw exports fall 7.4%. U.S. exports declined 11.5%, while Colombian exports plunged 21.3%.

Thus, record global consumption did not translate into record international trade. Much of the world’s coal is produced and consumed within the same countries, especially China and India.

The 2025 data support neither the claim that coal is disappearing nor the claim that the energy transition has stopped.

Coal use reached a record, but its share of global energy declined. Coal-fired electricity generation fell, but industrial and other uses kept total consumption elevated. Coal rebounded sharply in the United States but remained far below its historical peak. Europe continued to move away from coal, while Asia accounted for more than four-fifths of global demand.

The coal market is no longer one unified global story. It is a widening divide between countries that are steadily reducing their dependence on coal and countries where it remains central to electricity, industry, and economic development.

That divide is likely to continue defining the coal market for many years.

By Robert Rapier

Oil & Energy

FG To Stop Electricity Subsidy Payments From 2027

Published

15 hours ago

August 3, 2026

The Tide

The Federal Government has announced plans to end electricity subsidy payments from 2027 as part of efforts to tackle mounting liabilities in the power sector.

Minister of Power, Joseph Tegbe, disclosed this at a media interactive session , in Abuja, at the weekend.

Tegbe said the Federal Government would phase out subsidies beginning from 2027, assuring Nigerians the policy would not deprive citizens of the benefits currently enjoyed under the subsidy regime.

According to him, the proposed removal forms part of broader reforms aimed at ensuring the long-term sustainability of the electricity sector while tackling the financial challenges confronting the industry.

Tegbe explained that despite the planned subsidy withdrawal, there are no immediate plans to increase electricity tariffs, reassuring consumers that the government is not considering a tariff hike in the short term.

“The phase-out of electricity subsidies will begin from 2027. However, there are no immediate plans to increase electricity tariffs. Our goal is to build a commercially viable power sector while protecting vulnerable consumers.

“The Power Consumer Assistance Fund will play a critical role in cushioning the impact on vulnerable consumers as we implement these reforms,” the minister stated.

He pointed out that implementation timeline and consumer protection measures would be unveiled as the reform process progresses, emphasizing that Nigeria’s electricity subsidy has remained a major fiscal burden.

Oil & Energy

Firm unveils New Products For Oil Facilities

Published

15 hours ago

August 3, 2026

The Tide

An oil servicing firm, Solewant Group, has unveiled protective coatings and paints to secure oil facilities.

The products, manufactured at its new plant, sited in Alode Eleme, Rivers State, comprise of paints and coating that aid durability of oil facilities.

The products included the Solguard Architectural Coatings range comprising emulsion, matt and silk paints; Solguard Industrial Protective Coatings, featuring red oxide metal primer and alkyd gloss enamel; Solguard Heavy-Duty Protective Systems, including zinc-rich epoxy primer, high-build epoxy coat and acrylic polyurethane; and the flagship Novaguard Premium Specialty Coatings, made up of 100 per cent solid epoxy, polyurethane and polyurea systems for heavy industrial applications.

Unveiling the paints, at the weekend, Minister of State for Petroleum Resources(Oil), Senator Heineken Lokpobiri, described the products as innovative and pledged the federal government’s support to indigenous companies.

Lokpobiri described Solewant’s products as milestone in Nigeria’s industrialisation drive and local content development.

“This is clear evidence of the growth, which shows that local service providers in Nigeria have developed over the past 15 years.

“I’m very happy today that I have the privilege to witness this plant that will not just service Nigeria, but will service the entire African continent”, the minister said.

Lokpobiri praised Solewant’s expansion into Namibia, saying it marked the beginning of broader opportunities for Nigerian companies across Africa’s energy sector.

“We are fully committed to supporting companies like Solewant Group. That is the only way we can grow this industry.

“The solution to Nigeria’s energy problem lies with Nigerians. Nobody will come from anywhere to solve our problems in Africa”, he said.

He noted that the company’s new manufacturing capability would help address one of Nigeria’s biggest oil production challenges by providing locally manufactured protective coating solutions for ageing pipelines.

“Our pipes are completely corroded, and we need solutions that Solewant is providing to address that problem. What you have done here is a Nigerian solution to the Nigerian problem”, he said.

Speaking at the occasion, Solewant Group Chief Executive Officer, Solomon Ewanehi, said the investment was driven by the vision of ending Nigeria’s dependence on imported industrial coatings while building globally competitive manufacturing capacity.

In his words, “today we are not just launching the Solewant Coating Manufacturing Plant. We are launching confidence; confidence that Nigeria has the competence, the capacity and the courage to manufacture not just what we consume but also what we can export to compete with international standards.”

Ewanehi explained that the company unveiled 11 enhanced coating products under the Solguard and Novaguard brands, developed and manufactured in Nigeria for the oil and gas, marine, infrastructure and industrial sectors.

“Sixteen years ago, we asked a simple question: Why should Nigeria, a leading oil and gas nation, continue to import the very coatings that protect our critical assets?

“Today, that vision has become steel, concrete, plant and people”, he stated.

According to him, the products were designed to deliver world-class corrosion protection for pipelines, offshore platforms, refineries, storage tanks, bridges, power plants and other critical infrastructure operating in harsh environments.

Also speaking, Secretary to the Government of the Federation, Senator George Akume, described the project as “a powerful statement of confidence in Nigeria” and applauded Solewant for expanding local manufacturing despite ongoing economic reforms.

Represented by the his Special Adviser on Technical Matters, Prof Bolaji Babatunde, Akume said “your decision to expand manufacturing capability, develop technology and create value within Nigeria is a commendable example of the kind of private sector leadership that the Federal Government seeks to encourage me”.

Rivers State Governor Siminalayi Fubara, represented by his Chief of Staff, Barr. Sunny Ewuhle, also commended the company for choosing Rivers State as its industrial base.

“We are calling on all local and foreign investors to emulate what Solewant Group has done in Rivers State,” he said, pledging the state’s support for manufacturing, local content development and industrial growth.

Namibia’s High Commissioner to Nigeria, H.E. Walde Natangwe Ndavishiya, described the investment as timely, saying Solewant was well positioned to support Namibia’s emerging oil and gas industry.

“I particularly commend Solewant Group for taking the bold step of establishing a branch office in Namibia. This demonstrates confidence in Namibia and its emerging opportunities,” he stated.

By: Kevin Nengia