Oil & Energy

PEF Bridges To Ensure Uniformity In Petroleum Prices (II)

Published

14 years ago

September 3, 2012

This is the continuation of the story published last Monday, August 27, 2012

The Executive Secretary of the Petroleum Equalisation Fund
(PEF), Mrs Adefunke Kasali in this interview
with our correspondent gives an
insight into the operation of the PEF. Excerpts:

Once that is done, the information immediately and
automatically to the server in our head office and when they scan the entire
document into the server and attach it here, our processing department
processes it and from there it goes electronically to audit and all the
verifiers and approval levels and straight into our e-payment system. It is the
first fully end-to-end operations and payment solutions anywhere in the
country.

Question:Is the equipment fool-proof and how do you deal
with the human factor?

Answer:The design is done to have little human interference.
Our depot representative at the loading facility may have to click on some
issues, which have been preset, so that he just picks.

Once a marketer is registered on our database and he comes
into our office to do some transactions, all the depot representatives have to
do is to just pick that information. The truck would have been registered and
that information is sitting on the server and all in all the devices. It’s not
subject to a lot of human manipulation and that is the beauty of it.

Question: What are you doing to ensure that all depots are
captured in the project?

Answer: Our plan is that it will be 100 per cent deployed.
Now we have achieved just 60 per cent of the depots that are Aquila-ready. We
are in the process of deploying to the other depots and it’s really proper that
we follow up on all the procurement processes that have sort of delayed us.

Yesterday, one of the MDs of the facilities called me and
asked when are you bringing Aquila because all his marketers are saying with
Aquila they can get their money more quickly because nobody wants to buy from a
facility where they are not PEF Aquila-ready.

We are working very hard to ensure that in the shortest
possible time, we have all the depots in the country that are doing petroleum
transaction on Aquila so that they can all enjoy the benefits of what
government is doing.

I can be specific that by end of November, we should have
all the depots ready because the last bit of the procurement processes is that
we should be having all the equipment in Abuja in for deployment by the end of
September.

In the new Petroleum Industry Bill (PIB) what are the
assigned roles for PEF? The PIB as I have seen the PEF is still very much part
of the PIB that has been submitted by the executive to the legislative arm of
government. The roles will be clearer but basically, the mandate of the board
is still very much maintained by the PIB.

Question: The House of Representatives Committee on Public
Accounts ordered the management of PEF to refund N27 billion into the Federal
Government coffers within three months being 80 per cent of the operating
surpluses of the agency in the last five years. How far have you gone in this regard?

Answer: It is true that the House of Representatives Public
accounts invited the Board for a review of the 2009 accounts of the Board and
at that meeting, directed that the board should refund some money to the
federation account.

At that meeting, management tried to clarify the issues to
the members of the committee and I hope we still have an opportunity to discuss
the matter further.

PEF uses cash basis of accounting and so because the feeling
is that as a Fund, we should recognise what comes in and what goes out and that
is basically what cash basis accounting says.

Cash basis of accounting does not recognise receipts and
receivables that you are expecting and it basically does not recognise payables
that you haven’t been able to process and pay.

The starter of our payables as at the time these audited
accounts were submitted was not taken into recognition, so asking the board to
pay back money at that time doesn’t necessarily take into the account if the
money is still there. Because when you are looking back at an account, you do
not even know what that situation is a few years down the road. Needless to
say, the board has been given 90 days to do that.

Question: When an agency is asked to refund, the conclusion
is that some fraudulent practices must have taken place. Could you use the
occasion of this forum to set the records straight?

Answer: Certainly there was no untoward act, no corrupt act.
What the committee did was that if the board had receipts in the year at the
beginning or throughout the year and then the board then paid some monies out,
whatever was outstanding was considered surplus income. And that meant, for
instance, if one billion was outstanding that was not paid out, the committee
did not take into view that there could be 10 billion worth of claims waiting
to be paid at the end of the year.

Basically, they didn’t find very much that was wrong with
the account of the board except what they called surpluses and they then took
the position that those surpluses are supposed to be refunded to the federation
account and then supposed to be gotten out.

But the fund does not get money from the federation account
to pay its claims. So, if the money is returned into the federation account,
then the board will have an issue as to where the funding to pay the claims
when they are processed.

Question: Is this the same thing with the N20 million scam
on land? The committee also directed the board to refund another N20.22 million
within the same period for expenses incurred on a plot of land acquired in 2001
for its corporate head office but which was revoked by the Federal Capital
Development Authority, FCDA in 2006?

Answer:The other issue that was raised by the committee was
that in 2003 which predates my coming into the office, the FCT had allocated a
piece of land to the PEF for the purposes of developing its corporate
headquarters.

The files available to me actually indicate that the board
has prepared all the drawing and everything. It also forwarded all those things
to the appropriate department in the FCT for granting of a building plan
approval.

But before that could be done, the exercise that took place
around that time, the land was revoked and government took it back. I know that
when I came in 2007 as the executive secretary and I met that situation, I made
several attempts. In fact, I spoke to two past ministers of the FCTs and made
several vigorous attempts for us to get the land back and to develop the head
office.

But the House Committee has now taken the decision that
since the board had expended some of that money [20 million naira]… [cuts in]
and to the best of my knowledge a large chunk of that money was spent on
payment of license fee to the FCT, engineering design and drawing… the board
paid back and the N20 million into government coffers.

Question:How can the nation eradicate the issue of fuel
scarcity especially with the recent strikes by NUPENG, DAPPMA and JEPFON over
nonpayment of subsidy claims?

Answer: The issue of fuel scarcity is an issue of supply and
I think the focus that government has to rehabilitate and get our refineries up
and running efficiently is really the long term solution.

I know that there is a lot of work being done on getting the
refineries back, and the Turnaround Maintenance (TAM). The Honourable Minister
of Petroleum Resources had mentioned that contract for the TAM had been awarded
to the original builders of the refineries so that we can get the expertise
that went into building them the first place.

That is the long term solution when we have our refineries
working to meet our local demand then, the issue of distribution is easier.

Question: How can we ensure that petroleum products are not
diverted to neighbouring countries as it is commonly practised?

Answer:The issue like I said, is that of supply which is
ensuring that as much as possible we are refining what we produce in crude.
Also one of the benefits of Aquila is a truck that is headed for a particular
location cannot deliver to another location.

For instance, several marketers have said we are moving this
product to Suleja and it never arrives. Then they take it to another location.
When it gets in there and once our depot representative can’t even find it on
the server even if they try to receive that product through another means, it
won’t go.

So those are the things we are doing now to curb diversion.
Therefore, Aquila will curb a lot of that. Phase one of Aquila is depot to
depot, phase two is to ensure that when it leaves the receiving depot it ends
up in the retail outlet that it’s meant to go.

With this project over time, cases of diversion will be
really severely cut if not totally eliminated.

Question: How will the PIB affect operations in the oil and
gas industry?

Answer: I believe that the review of the laws and the
transformation plans will just help Nigeria. I believe that it will be good for
Nigeria.

As far as PEF is concerned as I said earlier, we have the
bill that has been presented to the National Assembly and our commitment to
Nigeria is that we will do whatever we need to do and work very hard to ensure
that the benefits that government had in mind in putting together PEF are
delivered to Nigerian public.

This is by way of our products being available in the retail
outlet s and also by way of cutting people who are exploiting the situation
that causes the products not being sold at the appropriate prices.

Oil & Energy

Can Cheap Batteries Deliver COP31’s 35% Electrification Goal?

Published

3 days ago

November 9, 2026

The Tide

Electrification will be the major focus of the COP31 United Nations climate conference, to hold in Antalya, Türkiye, from today, November 9 to 20, 2026. The host country will invite the attending nations to sign onto a voluntary pledge to reach 35 percent electrification on a global level by 2035. J

ust a year ago, this target may have seemed overly ambitious, but now, experts say that a number of factors, including volatile oil and gas markets stemming from the war in Iran, paired with enormous advances in clean energy technologies, have put that goal within “striking distance.”

The months-long closure of the Strait of Hormuz has catalyzed the clean energy transition and the rate of electrification around the world. Before the United States and Israel began their military offensive in Iran back in February of this year, one fifth of the world’s oil and gas trade flowed through the Strait of Hormuz. Its abrupt closure therefore sent global oil and gas markets into turmoil and sent energy-importing countries around the world scrambling for alternatives, especially ones that they could produce and control on their home soil. And, just like that, renewable energy became the new face of energy security.

“Wind and solar cannot be embargoed, blockaded, or shut off by a foreign power,” David Frykman, General Partner at Stockholm-based venture capital group Norrsken, wrote in an op-ed for Fortune earlier this year. “Every terawatt-hour of domestic renewable generation is a terawatt-hour that no adversary can weaponize.”

But there is another, quieter force that has made this rapid global pivot toward renewable energies possible – the energy storage boom. Energy storage is critical to ensure grid stability in the face of rapid electrification and the increasing representation of intermittent energy sources like wind and solar power in national energy mixes. Major advances in the sector in recent years have made battery storage more affordable and more scalable than ever before – just in time for the world’s most recent bout of ‘fossilflation.’

“What’s really become a game-changer in the past two years is the rapid deployment of large-scale batteries that can hang onto ever larger amounts of power to be used throughout the day to smooth out demand and avoid overtaxing the grid,” Forbes wrote in a Monday report.

The second quarter of this year saw the United States’ largest-ever energy storage expansion, at 20.2 gigawatt-hours of additional capacity, according to a report by the Solar Energy Industries Association and Benchmark Mineral Intelligence. That puts this year’s total additions at 30.8 GWh – and counting.

“Although President Trump is no fan of renewable energy or batteries, utility-scale energy storage capacity still nearly doubled to 165 GWh from 88 GWh in the first 18 months of his administration,” the Forbes article goes on to detail. “Grid operators, utilities and data center developers are all buying batteries as fast as they can to meet power demand and improve grid reliability. As a result, battery energy storage systems supplied more electricity to the grid in the year’s first eight months than in all of 2025.”

Ironically, despite his best efforts, Donald Trump is overseeing one of the United States’ most significant clean energy booms in the nation’s history as solar and wind have simply become too cheap to fail. And the United States is not alone. Buoyed by a flood of cheap solar panels and battery storage systems coming out of China, even the world’s poorest countries are experiencing clean energy revolutions.

“Some countries are pulling off stunningly fast energy transitions, adding solar so rapidly, it’s become a major source of electricity over the course of years — not decades,” reports CNN.

Pakistan has become the surprise poster child of this trend as residents install rooftop solar and batteries faster than any other market on Earth, as these systems provide electricity more cheaply and reliably than the country’s own beleaguered energy infrastructure. In addition, emerging economies including Brazil, Chile, El Salvador, Morocco, Kenya, and Namibia have all overtaken the United States – the world’s largest economy – in their clean energy transitions.

By Haley Zaremba

Oil & Energy

MAN, Ministry Tackle High Electricity Costs, Erratic Supply

Published

3 days ago

November 9, 2026

The Tide

The Manufacturers Association of Nigeria has said it is working with the Federal Ministry of Power to address high electricity tariffs, unreliable grid supply and rising energy costs that are undermining industrial production and competitiveness in the country.

The association said the collaboration would focus on developing sustainable energy solutions for manufacturers, including renewable energy, battery storage, captive power generation and improved electricity distribution.

Speaking during the second edition of the Manufacturers Energy Security and Energy Efficiency Summit in Lagos, the President, MAN, Dr. Ifeanyi Okoye, regretted that high electricity tariffs, unreliable grid supply and heavy dependence on fossil fuels had made industrial production exceptionally difficult.

Okoye said energy expenses consumed nearly half of some factories’ operating budgets, weakening their competitiveness, increasing product prices and threatening jobs.

He said manufacturers had continued to operate their own power infrastructure despite paying for electricity from the national grid.

“When energy expenses claim nearly half of a factory’s operating budget, competitiveness evaporates, retail prices skyrocket, and jobs are placed on the line,” he said.

Okoye said the association was moving beyond advocacy to implement practical solutions through its Industrial Energy Cost Reduction and Energy Support Programme, as key partners in delivering the initiative.

According to him, the programme would promote factory-roof solar installations, battery energy storage systems, captive natural gas generation and smart energy management networks to reduce production costs and protect manufacturers from global fuel price shocks.

He, however, stressed that manufacturers needed affordable, long-term financing to undertake the energy transition.

“We cannot finance 21st-century industrial transitions with 30-day commercial bank loans at cut-throat interest rates,” Okoye said.

He said the summit would bring financial institutions, climate funds and green investors together to develop long-tenured, low-interest financing instruments, carbon credit opportunities and asset-financing

Also speaking, the Minister of Power, Joseph Tegbe, warned industrial customers against unauthorised electricity connections.

He disclosed that investigations had uncovered about 14 industrial customers along a particular corridor who owed more than N400m in unpaid electricity charges over several years.

Tegbe said such practices deprived the electricity sector of revenue needed to sustain power supply and unfairly burdened consumers who paid their bills.

“Such conduct deprives the sector of revenue that we need to sustain the supply, and unfairly burdens consumers who pay honestly,” Tegbe said.

The minister vowed to recover the outstanding charges and hold those responsible accountable, urging MAN to encourage its members to maintain lawful electricity connections and comply with applicable regulations.

Tegbe acknowledged that manufacturers continued to struggle with electricity interruptions, poor power quality, vandalism and electricity theft, adding that the government was directing investments towards addressing the underlying problems.

Speaking on behalf of manufacturers, the MAN South-East Chairman, Ada Chukwudozie, said energy had become a question of survival and competitiveness for Nigerian manufacturers.

She said manufacturers were increasingly financing and managing their own electricity infrastructure while struggling with rising production costs and limited access to capital.

“We are effectively running a second power system paid for by ourselves, besides the grid we also pay for. And that is why for the Nigerian manufacturer, energy is no longer simply an operational issue. It is a question of survival and competitiveness,” Chukwudozie said.

She explained that unreliable electricity supply forced manufacturers to make difficult choices between purchasing energy and raw materials, maintaining equipment and paying workers.

The regulator added that manufacturers could strengthen their competitiveness by adopting cleaner energy sources as international markets increasingly imposed environmental and carbon-related requirements on products and supply chains.

Oil & Energy

Reps Panel Dismisses Petition Against NIPCO gas Licence

Published

3 days ago

November 9, 2026

The Tide

The House of Representatives has dismissed a petition seeking the cancellation of gas distribution licences awarded to NIPCO Plc, ruling that the petitioners failed to provide credible evidence to substantiate their allegations.

The decision followed a review by the House Sub-Committee on the Petition concerning NIPCO Plc, which rejected the complaint filed by the Nigerian Energy Security Watch Group (NESWG) for lacking substance and evidential support.

The petition had called for an investigation into, and the suspension and cancellation of, gas distribution licences issued by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to NIPCO for Lagos, Ogun, Oyo and Osun states, as well as the Lagos and Lekki Free Trade Zones.

Announcing the decision last Thursday, the Chairman of the Sub-Committee, Peter Aniekwe, said the petitioners relied on hearsay and failed to establish any wrongdoing in the licensing process.

“At its sitting today, the Sub-Committee resolved not to proceed with the investigation, and the petition is accordingly dismissed,” Aniekwe said.

The committee, which also includes Dahaltu Shehu, was constituted in October to examine the petition. It was granted an additional 14 days on October 26 to conclude its assignment.

Aniekwe said the issuance and regulation of gas distribution licences were statutory responsibilities of the NMDPRA under the Petroleum Industry Act, while stressing that the National Assembly would continue to exercise oversight over the process.

He disclosed that the regulator had committed to completing and rolling out gas distribution licensing in the fourth quarter of 2026, adding that the committee would monitor the implementation.

“Nigerians deserve a gas market that is open, competitive and safe, and investors deserve rules that are clear and stable,” he said.

The lawmaker reaffirmed the House’s commitment to considering petitions from individuals and organisations with genuine concerns about the petroleum sector, saying “each complaint would be assessed on its merits”.