Oil & Energy

OTC 2013: Focus On Nigeria

Published

12 years ago

May 20, 2013

Offshore Technology Conference (OTC) is an oil and gas industry foremost event that could be likened to the Olympics where professionals in the industry and stakeholders across the globe converge to brainstorm for the development of hydrocarbon resources. It covers all aspects of the energy industry and could be described as the best event where technical expertise is acquired. This year’s event which is the 14

th edition of the OTC held in Houston’s Reliant Centre, Texas from 6th -9th May. Below are some remarkable comments on Nigeria’s Oil and Gas industry at the 2013 event:

Nigeria Petroleum Minister Gave The Keynote Address

The Minister of Petroleum Resources, Mrs Diezani Alison-Madueke represented by the Group Managing Director of Nigeria National Petroleum Corporation (NNPC), Andrew Yakubu, in her address accused international traders of being partly responsible for the increasing spate of crude theft in Nigeria as they have developed a high appetite for stolen crude from the country.

In the address, which had the theme, “Development Efforts In West Africa Exploration Zone,” Alison-Madueke urged the international traders to cut down their high appetite for stolen crude from Nigeria and join in the fight against the activities of oil thieves and pipeline hackers.

She said for the country to achieve its obligations in the global supply mix, it was paramount for the international communities to stop buying crude oil from Nigeria.

Her words: “It takes two to tango. If those stealing Nigeria’s crude do not find a ready market for it, there would be no incentive to steal. That is why we are appealing to the international community to take action.

“Trading the country’s crude by DNA to the destination is being looked into, to ensure that the fingerprints of our crude are traceable to various destinations. I can tell you that as an industry we are happy to work with governments in this regard.

Describing the sub-region as the most important petroleum province in the world, she said the natural advantages of the region’s open and unrestricted sea lanes and light sweet crude make it one of the most important province in the world. The Petroleum Minister noted that as the dominant player in the sub-region, Nigeria has pioneered some set of initiatives targeted at ensuring positive impact on the economy.

These initiatives, she listed include growth in crude oil reserves and expansion in production capacity, repositioning of gas for re-industrialisation/stimulation of the economy, regional and export penetration, revitalisation of existing downstream capacities and additional capacity to support energy and reforms of key institution to anchor the growth aspiration of the industry.

On the PIB, she said the bill is further designed to increase exploration and development activities in the region by creating more competitive environment for all players in the industry pointing out this will attract investment into the sector. She noted further that West Africa will continue to play a significant role, post-shale and gas discoveries in the global oil and gas energy supply mix.

Nigeria has sufficient Gas For Power Supply.

Nigeria’s inability to transmit and distribute electricity power have been said to the cause of the erratic power supply witnessed in the country and not lack of gas.

The Group Executive Director, Gas and Power, NNPC, Dr David Ige who made the disclosure said the generation of power was not a lone thing, but involves generation, transmission and distribution noting that over the years gas production has increased significantly.

Ige noted that “Infact, at the moment, domestic gas production in Nigeria is at all time high. We are now producing about 1.5billion cubic feet per day of gas which is the highest ever the country has produced. Apart from this, we have another 300million that are available in the East that is not utilised now. So, our gas development is actually on the increase and it is the most aggressive rate. We have grown about 200 per cent year-on-year.”

He said the failure to evacuate the gas that has been produced was the reason for the epileptic electricity supply in the country. The Gas and Power Director explained that as supply continually competes with demand, stakeholders are also taking steps to increase gas generation to meet the anticipated increase in transmission and distribution of power.

According to him, “The generation capacity is growing everyday because stakeholders are bringing in new turbines everyday. However, I can say for sure that our current gas availability is not enough for all the generating capacity that is being built and we recognise that. At any point in time, demand is going to be ahead of supply, because demand is pulling supply. Right now, the inability of Nigeria to have stable power supply is not as a result of unavailability of gas but the distribution challenges we are still grasping with. Generation is far ahead of distribution and transmission.”

He disclosed that there was plan to bring additional 130million cubic feet per day with the aim to achieve 2billion cubic feet per day over the next two years.

He stressed further that the country has the capability to generate, transmit, and distribute 4.5gigawatts of electricity of all the supply chains were put in order.

Shell To Continue Force Majeure Declaration

Shell Petroleum Development Company (SPDC), has said the increasing declaration if force majeure by the company may continue until it recovers substantially from the attacks on its facilities.

The Managing Director and Country Chair of Shell, Mutiu Sunmonu who made the assertion told newsmen that there were some steps that need to be taken together, despite all the efforts being put by security agencies, to ensure that vandalism does not continue.

According to Sunmonu “The force majeure you have seen us declare is for us to remove some of the very bad bunkering points because if you don’t remove those bunkering points even if you have entire Nigerian Army in the creek, you will still continue to see crude being stolen. So our initial attempt is to remove those bunkering points to complement what the security agencies are doing.”

He explained that there has been a recent upsurge crude theft Nembe Creek Truck Line (NCTL), which resulted to frequent production shutdown and massive spills in the communities.

Between February 22 and 25, he noted, 12 flow stations were shut by safety systems three times because of crude theft and about 80,000 barrels of crude were lost to oil theft, he explained further.

He however, said the level of crude theft in the Niger Delta was decreasing and attributed it to the commitment of security agents.

His words: “If you have been following my statements in the media, certainly oil theft was on the increase a few months ago, but I can also tell you that I have also seen increase attention by the government security agencies, the Joint Task Force (JTF) and the Navy. They are really moving in to stem the tide. I wouldn’t say I’m happy but at least I can see improvement in responsiveness of government security agencies to the menace. I think the joint security team is getting more effective. We are having almost a daily discussion with them and they do give us good report on their efforts so far.”

He was quick to add that he was not expecting overnight solution, but the security agencies should keep at what they were doing as if done for a while there would be significant reduction.

Explaining further he said: “Unless you are in the creek you may not be able to appreciate what the government’s security agencies are doing, because of there is hardly any day that they are not foiling attempts, arresting vessels and destroying illegal refineries.

“For instance, in a place such as Bodo in a week or two weeks ago, they foiled over 30 different attempts by crude oil thieves wanting additional tapping points to our line.”

He added that the company cannot be certain on the figure of how much oil it was currently losing to oil theft since NCTL was down, but when it is up, it will be able to be certain on the number of barrels reduction in stolen crude.

First Bank Committed To Indigenous Coys

First Bank Plc says out of its N1.5 trillion loans and advances, well over 45 per cent was used to finance oil and gas projects in the country.

The bank’s Executive Director, Kehinde Lawanson highlighting financial institutions’ commitment to building local capacity and to the energy sector, said 45 per cent of loans and advances components of the bank’s balance sheet went to the upstream, midstream and downstream of the petroleum industry.

Lawanson added that the bank also financed 40 per cent of petroleum import into the country noting that since 1958, the bank has been financing projects for international and Nigerian oil companies.

According to him, First Bank was a lender and arranger of hybrid loans in excess of $100million 128KM gas pipeline to Unicem Cement Plant in Calabar, Cross River handled by East Horizon Gas Company; Co-lender 0f $289million to Atlantic Energy for working capital and payment for 55 per cent interests of National Petroleum Development Company; in OMLs 26, 30,34,42; sole financier of the $15.15million facility for acquisition of two vessels by Fymak Marine and Oil Services Nigeria, and provided part of the bridge loan financing for the acquisition of ConocoPhillips’ divested interest in OMLs 60,61,62 and 63.

Oil & Energy

Reps Launches Probe Into N200bn CBN Loan To DISCOs

Published

7 hours ago

May 12, 2025

The Tide

The House of Representatives has launched an investigation into the disbursement and utilisation of the N200billion Central Bank of Nigeria (CBN) loan allocated for the National Mass Metering Programme (NMMP) to Electricity Distribution Companies (DISCOs).
Chairman, House Committee on Public Assets, Rep. Uchenna Okonkwo, disclosed this in a statement in Abuja.
He confirmed that a 19-member sub-committee had been inaugurated to probe the matter thoroughly.
Okonkwo recalled that the NMMP, initiated in 2020, was designed to provide free electricity meters to Nigerian consumers through the Licensed Electricity Distribution Companies (DISCOs).
He said the programme was a joint initiative of the CBN, the Nigerian Electricity Regulatory Commission (NERC), and other stakeholders in the Nigerian Electricity Supply Industry (NESI), aimed at eliminating estimated billing, improve transparency in energy usage, and enhance customer satisfaction.
Speaking on the launch of the NMMP, the Rep said the programme was to be implemented in three phases to ensure the reduction of collection losses and improve market remittances in the industry.
“Under the pilot phase of the programme’s implementation, CBN commenced with the sum of N59.280 billion for procurement and installation of one million meters in 2020 at an interest rate of 9 per cent after a two year moratorium.
“Preliminary research on the NMMP has shown that instead of the pronounced amount of N59.280 billion naira for the phase 0, what was released was N55.4 billion for procurement and installation of 962,832 meters instead of one million meters pronounced by CBN”, he noted.
Okonkwo stated futher that concerns have been raised regarding repayment, with the committee noting discrepancies in the repayment of the funds by the DISCOs.
According to Okonkwo, “Research has also shown that the eleven Electricity Distribution Companies who received the loan have paid back to CBN as refund for the N54.4 billion they received in 2020 without mentioning the 9 per cent interest on the loan.”
The lawmaker, however, said the subsequent phases of the programme, which were expected to significantly expand metering across the country, have stalled, explaining that Phase 1, which was to be funded by the CBN and Deposit Money Banks (DMBs) for 1.5 million meters, and Phase 2, expected to be financed by the World Bank for four million meters, are yet to take off.
He said the House, exercising its constitutional powers under Sections 88(1) and (2) of the 1999 Constitution, resolved to investigate the matter with a view to safeguarding public interest.
According to him, the sub-committee is expected to scrutinise all aspects of the NMMP funding, from disbursement and meter procurement to distribution and repayment mechanisms.
The 19-member committee comprises Reps. Obed Shehu, Ali Shettima, Abel Fuah, Salisu Koko, Ahmed Munir, Sani Umar Bala, Gbefwi Jonathan, Abdulmaleek Danga, Chinedu Obika, and Okunlola Lanre.
Others include Reps. Abass Adekunle, Akinosi Akanni, Obuzor Victor, Peter Akpanke, Ngozi Lawrence, Ogah Amobi Godwin and Ikeagwuonu Onyinye.
It would be noted that the NMMP was expected to be a game-changer in Nigeria’s power sector by reducing estimated billing, enhancing energy accountability, and restoring consumer trust.
However, the current revelations point to implementation failures and possible mismanagement of public funds.
Analysts believe that the outcome of the House probe could lead to reforms in electricity metering policy and strengthen regulatory oversight of loan disbursements to DISCOs.

Oil & Energy

“Renaissance Energy, NNPC JV Donate ICU Equipment To RSUTH

Published

7 hours ago

May 12, 2025

The Tide

Renaissance Africa Energy Company Limited and its joint venture partners, including the Nigerian National Petroleum Company Limited (NNPC), have donated vital medical equipment and essential drugs to the Intensive Care Unit (ICU) of the Rivers State University Teaching Hospital (RSUTH).
Among the equipment are three ventilators, a laser therapy machine, as well as significant supply of seed stock drugs targeted at enhancing the hospital’s capacity to provide critical care and ensuring consistent drug availability.
Speaking at the Handover Ceremony at Renaissance Energy Headquarters, in Port Harcourt, the General Manager, Relations and Sustainable Development, Renaissance Africa Energy, Igo Weli, said, “The gesture by Renaissance and our partners is to enhance the capacity of the hospital to provide critical care to patients in need; improve the training of upcoming healthcare personnel; and provide support to dedicated healthcare professionals in their mission to save lives and improve patient outcomes.”
The Chief Upstream Investment Officer, NNPC, Oluwaseyi Omotowa, noted that the donations were part of a broader social intervention strategy of the Renaissance-operated joint venture.
Omotowa, who was represented by the Lead, Stakeholder Relations, NNPC Upstream Investment Management Services, Mrs. Uzo Ejidoh, further said “the JV has a deliberate corporate social responsibility strategy to serve the people.
“This is an unchanging commitment, hence our steadfast support and investment in social impact projects for the healthcare sector to continue to transform lives”.
Recieving the donations, the Chief Medical Director, RSUTH, Professor Chizindu Alikor, stated that the hospital was committed to the delivery of excellent healthcare along with research and training.
Alikor said, “The teaching hospital is on an upward trajectory. The ICU facilities were over stretched, and we are excited that our request to Renaissance and its partners for assistance was granted.
The CMD expressed the hospital’s confidence in Renaissance’s capacity and people-centric interventions, especially as it concerns Corporate Social Responsibility (CSR) in the health space.

By: Lady Godknows Ogbulu

Oil & Energy

Tight Now, Loose Later: Oil Futures Flash Warning

Published

7 hours ago

May 12, 2025

The Tide

Last week, OPEC+ announced it will once again accelerate the pace of unwinding of production cuts, with output targets for June increasing by 411,000 barrels per day, equivalent to three monthly increments.
This follows a similar move in April, with the organization appearing willing to stay the course amid low oil prices and fears of weakening demand.
We reported that global crude inventories remain low enough, thus giving OPEC+ a window to scale back its voluntary cuts until the market surplus finally arrives.
Saudi Arabia appears intent on “punishing” OPEC+ rascals such as Kazakhstan and Iran for repeatedly violating their quotas.
Commodity analysts at Standard Chartered have reported that the latest OPEC survey of secondary sources reveals that Kazakhstan’s crude oil output clocked in at 1.852 mb/d in March, 384 kb/d above its OPEC+ quota.
Further, the country also failed to keep its promise to cut 38 kb/d in compensation for overproduction in March, bringing its total overproduction to 422 kb/d.
The same scenario is expected to unfold in the coming months. Kazakhstan produced 240 kb/d more y/y in March, a sharp contrast from the other eight OPEC+ members who produced a combined 612 kb/d less.
And now, the oil futures markets are sending a dire warning that oil bulls could find themselves in trouble quite soon due to a combination of the OPEC+ output hike and Trump’s tariffs.
Oil futures curve has formed a rare “smile” shape, a structure Morgan Stanley says was last seen briefly in February 2020 just before the infamous oil price crash.
On Wednesday, Brent futures’ July contract was trading at a premium of 74 cents to the October contract, a market structure known as backwardation, foreshadowing immediate tight supply.
However, prompt prices from November have formed a contango, with forward prices flipping to a discount, indicating oversupply as traders predict Trump’s tariffs will eventually weaken oil demand. Having backwardation and contango together leads to the rare “smile” shaped curve.
According to the latest available data by the International Energy Agency (IEA), global oil inventories stood at 7.647 billion barrels in February, down from 7.709 billion barrels for last year’s corresponding period and close to the bottom of their historical five-year range.
Meanwhile, refiners’ appetite for crude is climbing ahead of the peak driving season in July and August, “Refinery maintenance in the Atlantic basin will start to taper off, increasing oil demand (for refining)… Summer driving should provide some support,” BNP Paribas analyst told Reuters.
Global oil demand is expected to rise by 1.3 million barrels per day in the third quarter of the current year, up from an average of 104.51 million bpd in the second quarter, the IEA has predicted.
The 1 million bpd output increases announced by OPEC+ so far, coupled with another 400 kb/d increase in July, almost matches the predicted demand increase, implying oil markets will not face a surplus till late in the year.
Meanwhile, oil prices jumped in Thursday’s session after the Trump administration announced it has struck a trade deal with the UK. Brent crude for July delivery was up 2.7% to trade at $62.75/bbl at 12.50 pm ET while WTI crude contract for June delivery added 3.0% to change hands at $59.86 per barrel. However, terms of the deal appear to fall well short of the “comprehensive” package Trump earlier touted.
According to Trump, UK Prime Minister, Keir Starmer, will further reduce non-tariff barriers and fast-track U.S. goods into his country.
Meanwhile, another solid week of jobless claims underscored the Federal Reserve’s ongoing unwillingness to cut rates. U.S. jobless claims fell 13,000 to 228,000 for the period ending on May 3.
Continued claims, however, clocked in at just over 1.9 million, near the highest levels since 2021, suggesting workers are still finding it difficult to secure new jobs as the economy stalls.
That said, commodity analysts at Standard Chartered have predicted that path of least resistance for oil prices is lower in the coming months, with oil prices to remain low before beginning a gradual recovery later in the year as U.S. oil output declines.
StanChart, however, says there’s some technical support in the short-term, with fundamentals remaining fairly positive. Recently, StanChart cut its 2025 oil price forecast to $61/bbl from $76 and also lowered its 2026 forecast to USD 78/bbl from $85 citing Trump’s tariffs.