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NNPC Grows Profit To N674bn, Assets Hit N16.3trn

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The Group Chief Executive
Officer, Nigerian National Petroleum Company (NNPC) Limited, Mele Kyari, has announced that the NNPC as a corporation grew its profit after tax and assets from N287 billion and N15.86 trillion in 2020, to N674 billion and N16.3 trillion in 2021, respectively.
Kyari, who disclosed this at a press conference in Abuja, said the 2021 profit was contained in the Group Audited Financial Statement of the oil firm for the year ended December 31, 2021.
He also disclosed that all major trunk lines conveying crude oil to export terminals were currently shut down in order to avert further oil theft in the Niger Delta.
He, however, stated that efforts by the oil firm, security agencies and surveillance contractors were paying off, as about 400,000 barrels of crude would be added to the country’s output in the next few days.
The NNPC boss said, “In September 2021, Mr. President graciously approved the publication of the 2020 NNPC Group Audited Financial Statement, in which NNPC declared a profit after tax of N287bn for the first time in its 44 years.
“Despite our challenging operating environment, we strongly believe that NNPC has the potential to sustainably deliver better value to its esteemed shareholders.
“Today I am happy to announce that the Board of NNPC Limited has approved 2021 audited financial statements, and NNPC progressed to a new performance level, from N287 billion profit in 2020 to a N674 billion profit after tax in 2021, climbing higher by 134.8 per cent year-on-year profit growth.”
He continued ed, that “the group’s financial position recorded an increase in total assets from N15.86 trillion in 2020 to N16.27 million in 2021, while our total liabilities decreased by 8.3 per cent from N14.68 trillion in 2020 to N13.46 trillion in 2021.
“Our shareholders fund position grew to N2.81 trillion, representing 144 per cent year-on-year. The performance would have been greater if the operations in the year under review were free from incessant vandalism, crude oil and products’ theft among others.”
In the main drivers of the profit, Kyari said, “Our core business is upstream, gas and power. So the key drivers to this performance are coming from the upstream and the gas and power.”
Commenting on the amount of crude oil being lost to theft and why it had been difficult to contain oil theft, the NNPC helmsman stated that though oil production had slumped, not all reported volumes were stolen.
“Today, our production is around 1.2 million barrels per day. We have proven capacity and this was seen in 2020, where our production, without any intervention, peaked at 2.49 million barrels per day.
“That means we have capacity, without doing anything extra, to produce up to 2.49mbpd. But since COVID-19 abated and, of course, the issues around the acts of vandals returned, we saw this gradual decline in our production to the point of this 1.2mbpd production currently.
“That means that you can easily produce up to 2.49mbpd but you couldn’t do it because of the acts of vandals. Now, this doesn’t mean that the difference between 2.49mbpd and 1.2mbpd is stolen. No. It is far from this.
“As we speak now, all our major trunk lines are shut down. That means you are not flowing crude oil into these lines, but you could have done it and it doesn’t mean the product is stolen. When the lines are running, you can lose a substantial part of that volume.
“And we believe that when they are running, you can lose up to 200,000 barrels to theft. But in actual losses today, our budget level plan is to produce at 1.8mbpd. So, if you are doing 1.2mbpd, it technically means you are losing the difference between 1.2mbpd and 1.8mbpd.
“And this is around 600,000bpd as opportunity lost, not stolen. So, once you bring back the line and you are not able to secure it, you’ll still get some of the oil flowing into the terminals but you’ll lose some part of it”, he said.
Kyari insisted that the above scenario did not mean that 600,000bpd of oil was stolen, describing it as opportunity lost because of the shutdown of production facilities.
“But I’m happy to also say that the interventions that we have seen in terms of the security measures we have taken, in collaboration with the government security agencies, with the private surveillance and security contractors, and the investments that we have done, we believe that in the next couple of days we will be able to bring back the Trans Niger Pipeline,” he said.
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Business

SON Plans Stiffer Penalties For Fake Products 

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Standards Organisation of Nigeria (SON) has revealed that it would soon seek an amendment to the Act establishing the Agency, which would prescribe stiffer penalties or sanctions for importers and manufacturers of fake and sub-standard products in Nigeria.
Mallam Farouk Salim, Director General of SON, disclosed this in Abuja at a media briefing to mark the 50th-anniversary celebration of SON.
Salim explained that the provisions of the proposed law would not only stipulate that the importers and manufacturers of sub-standard products be fined, but also jailed on conviction by the court.
He said SON is poised to fight against counterfeit and sub-standard products across the country, adding that “any time Nigerians buy sub-standard products, they are aiding and abetting the closure of Nigerian industries and helping the youths to be unemployed.”
Commenting further on the effects of sub-standard products on the economy, Salim said the importers of counterfeit products contribute to the present insecurity in the country, as their activities have led to the collapse of industries in Nigeria.
Noting that the Act establishing the SON was last amended in 2015, he said, before 2015, the penalties were not very clear in the Act. So, the amendment has empowered us for conformity assessment.
“The reason we always amend the Act is that the world is evolving and industries are always changing
“The people following the rules are also changing. Hopefully, before the tenure of this administration, we will have another amendment that will be presented to the National Assembly.
“For example, in 2015, the penalty for importing sub-standard products was N1 million and N1 million now, is not significant.
“Most of these people importing these products are not poor, they are rich.
“In the industry where people break the rules, it is the consequences that stop them.
“So, we need to amend the Act to increase the jail term or give them the right to fine and make sure that jail term is added to it”.
On the activities of SON over the last 50 years of its existence, Salim said the organisation has gone through a lot of transformation and evolved to become a standards regulatory body of global recognition.
According to him: “It is important to emphasise that SON today has evolved into one of the world’s most reputable standards regulatory bodies due to good leadership demonstrated by the successive Chief Executives.
“This is seen in the various innovations championed by the past and present leaders of the organisation.
“Some of the notable innovations over time in the Organisation are the Mandatory Conformity Assessment Programme (MANCAP) for local manufacturing, and Standards Organisation of Nigeria Conformity Assessment Programme (SONCAP) for offshore assessment of cargoes’’.
Speaking further on the milestones recorded by SON, he said: “To further demonstrate its desire for a more effective standardisation process, the Federal Government introduced the first ever Nigerian National Standardisation Strategy (NNSS) 2020 – 2022 as part of its economic diversification policy.

The strategy, which was developed by the Standards Organisation of Nigeria (SON), is designed to identify priority areas to focus on, based on national needs assessment.

The SON Governing Council recently approved 168 new Standards for publication and dissemination to various sectors of the nation’s economy in furtherance of the ongoing economic diversification policy.

Currently, SON is structured to lead every process that surrounds the preparation of standards relating to products, measurements, materials, and processes among others, and their promotion at the national, regional, and international levels.

“Working within the provisions of the Enabling Act, SON under my leadership, SON has been able to, through the Standards Council, designate, establish, and approve standards in respect of metrology, materials, commodities, structures, and processes for the certification of products in commerce and industry throughout Nigeria.

“SON is a member of international constellations of standards regulators such as the International Organization for Standardization (ISO).

“Upon assumption of duty in September 2020, we have set some goals to make the Organisation to effectively deliver its mandate.

“So far, we have been able to facilitate the return of SON to the Ports and ensure the election of Nigeria into the standards management committee of the African Organisation for Standardisation (ARSO), among others.”

SON was established in 1970 with the creation of the Nigeria Standards Organisation (NSO) as a Department under the Federal Ministry of Industry, Trade and Investment.

By: Nkpemenyie Mcdominic, Lagos

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Business

Coy Begins Cargo Tracking In Lagos Port 

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Webb Fontaine, a leading service provide for Nigeria  Customs  Service (NCS) has put in place cargo tracking system  trade automation for use in Apapa Port.
This was disclosed to our correspondent by Webb Fontaine’s Operations Manager in Nigeria, Vlad Lonescu, who said the feat, which is a breakthrough and major milestone in NCS modernisation drive, will aid online, real-time, and live monitoring containers within controlled areas in the customs zone at the port and outside of the port.
According to him, anomalies such as containers missing in transit, tampering with the seal, broaching, and removal of cargo before the examination can be easily detected and traced using the technology.
It will also change the narrative that neighbouring countries like Benin Republic are ahead of Nigeria in areas of customs and ports aided automation.
According to him: “Customs officers trained by Webb Fontaine will operate the system that will aid in achieving more operational successes that could have been done manually”
The new system, he said, comes with many advantages including building shippers’ and port users’ confidence in theft prevention and curbing other unlawful activities.
“It will save the cost and time of using too much manpower to provide escort services for cargoes in transit as their movements within a geo-fenced zone will be monitored.
“Diversions of cargoes from specified movement itineraries will be swiftly detected with further preventive mechanisms activated to prevent loss or theft of cargo’’.
The feat in Apapa, which  will also serve as test run that will be replicated in other ports across Nigeria, will help to position the country as one with a competitive port, befitting for hub status in the West and Central African region.
Webb Fontaine has succeeded in automating the Lagos Free Zone which is first of its kind in the county sitting on 82 hectares of land.

The Lagos Free Zone automation makes the complex stand out amidst 42 other free zones in the country being the first to be so technologically wired for trade.

It is the first free zone in the country to be proximate to the most modern and equipped Lekki  Deep-Seaport.

Webb Fontaine’s trade solutions in Nigeria is presently impacting on more than 25 government agencies through automation of their processes and bringing Nigerian business world closer to what obtains in advanced economies where it is providing services, Lonescu said.

“This cargo tracking system, it will function in Apapa, Tin Can port with 2 Inland Container Depots with many objectives, among which is to decongest the port and improve the revenue of the NCS.

“It is also a way of monitoring the containers that are moving between the port and outside, which means we will have eyes on the containers at all times. Therefore, if there is any attempt to tamper with the process, we can immediately flag it and alert the customs officers.

“The NCS will monitor the full process; we are in charge of training the officers that are going to operate and supervise the transit of the goods. They will be in a control room with screens, computers and digital maps, from which they can monitor the movement of each containers.

“By doing this, the port will be decongested, and all stakeholders like the terminal operators, ship owners, freight forwarders and all will be confident that when they move cargo from the port, things will not get lost and they will be safe.

“For now, we are in the pilot stage, and we are bringing in  specialists to train officers both inside and outside the port. For Customs, we’re going to do Web Fontaine’s Training the Trainers, so we are not training all the officers who will be in charge of this system; we will train a few, who will then pass on the knowledge

By; Nkpemenyie Mcdominic, Lagos

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Oil & Energy

NNPCL Flares 100% Gas Output  Earns Zero Revenue In Sept

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In spite of the Federal Government’s gas monetisation policy and pledge to the United Nations to attain net zero by 2060, the Nigerian National Petroleum Company Ltd. flared 100 per cent of their gas output in September and earned no revenue from it during this period.
The NNPCL gas production and utilisation data for September 2022, obtained by The Tide’s source described its subsidiary, Nigerian Petroleum Development Company as one of the worst offenders in gas flaring in September.
The firm and its Joint Venture partners, Seplat Petroleum Development Company and NPDC-Chevron Nigeria, flared 100 per cent of their entire gas output of 106 million standard cubic feet of gas and 7 million standard cubic feet of gas, respectively.
The firm further noted that Newcross Exploration and Production Ltd and Belema Oil flared about 96 per cent and 75 per cent of their 112 million standard cubic feet of gas and 21 million standard cubic feet of gas, respectively.
Also, about 8 billion SCF of gas was flared in September, representing 5 per cent of the total gas output for the month, compared with 10 billion SCF of gas flared in the month, of August, according to the report.
This is coming at a time the country is battling a cash crunch due to a drop in its oil revenue on the back of a significant decline in oil production which dipped to below 1million barrels per day, the lowest in 32 years.
The government has been relying heavily on borrowing to finance its activities, as its debt reached an all-time high of N42.84 trillion in June.
The NNPCL gas production and utilisation data did not state why the firm had flared the whole of its gas production for the month. The firm’s spokesperson, Garba Deen, did not also respond to both phone calls and messages sent to him.
Mobil emerged as the highest gas producer in the month under review with a total output of about 25 BSCF of gas, out of which it utilised 23 BSCF of gas and flared 1.6 BSCF of gas.
Shell Nigeria followed with a total gas output of about 25 BSCF of gas, utilising 24 BSCF and flaring 0.5 BSCF; Chevron Nigeria produced about 24 BSCF of gas, out of which it utilised 23 BSCF and flared 0.2 BSCF of gas and Total Energies Nigeria produced about 23 BSCF of gas, out of which it utilised 22 BSCF and flared 0.6 BSCF of gas.

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