Oil & Energy

Oil Gas As Critical Areas To Nigeria’s Economic, Social Performance

Published

3 years ago

June 12, 2023

Oil alone accounts for 40 pre- cent of the country’s GDP, 70 per cent of budget revenue, and 90 per cent of foreign exchange earnings.
With 18 operating pipe
lines and an average daily production of some 1.8 million barrels in 2020, Nigeria is the eleventh largest oil producer worldwide. The petroleum industry accounts for about nine percent of Nigeria’s GDP and for almost 90 percent of all export value.
Nigeria’s dependence on petroleum is much greater than that of many other major producing countries.
Players in the oil and gas environment have said that the industry in Nigeria in the last eight years remains the worst.
They say nearly every measure of industry performance has run against the sector in the last decade.
According to them the level of insecurity, subsidy issues, employment, revenue access, have headed for the worst.
A private sector player in the oil and gas environment, Mr. Emeka Nwaneri, noted that some positives have been recorded in the last eight years, especially the passing of the Petroleum Industries Bill (PIB) in to law.
He regrets, however, that since the bill was eventually passed, it has not translated into the realities of increasing the activities in the oil and gas sector.
He noted that the most recent one is the removal of fuel subsidy, which he stated, was greatly impacting on the economy and oil and gas sector that operates in the economy.
According to him, “organisations like ours run generators 24 hours in our various locations and with the removal of the subsidy, it’s going to increase our realising the fact that the cost of diesel has gone up tremendously in the last two years.
“Between 2018 and 2010 deisel was being sold for N150 per litre, for today, the cost of diesel is over N800 per litre. The impacts of petrol is that some of our operations that we use petrol will also be impacted.
“Now we are getting fuel at not less than N520 if it is not in the NNPC stations. So, invariably, the cost of our services will jump up and our clients do not know how much they are able and willing to accommodate, so it is invariably going to impact on our profit line as it increases our cost of production, which would invariably lead to job loss”.
Nwaneri explained that when cots of production becomes too high, the business owners look for windows to reduce cost and one of the ways is reducing labour costs.
He said, “it might affect employment in the sense that the employer might see the cost of labour as a quick substitute to cushion the effects of the cost of petrol. So, when workers are affected in terms of laying off workers, then generally it will impact on the economy and the workforce”.
Another positive for the oil and gas sector is the convertion of some flared gas into domestic use. However, this has also not translated to low prices of gas, he noted.
He stated that this has a challenge of leadership in Nigeria, “there has always been the issue of transparency and accountability. Of a truth, the fuel subsidy happens to be a huge cost to government.
“However, we have also seen situations where money is borrowed from various bodies and this monies instead of improving on infrastructure are diverted into private pockets.
“Just recently, I read about the case of the Central Bank of Nigeria (CBN) Governor spending well over N5.2 billion to produce N2.1 billion. It doesn’t make any economic sense.
“So, it means that when you are undertaking a project like the currency swap, it was meant to be undertaken at a minimal value. It is expected that it shouldn’t have cost more than the value of the currency we are exchanging.
“So, if we’re going to get a new currency at N2.4 or N2.1 billion as the case maybe, the total cost of getting that should not even get to N1 billion.
“I’m not relating this to oil subsidy, but government has said that there’s going to be a lot of savings that is going to cushion the effect of governance, but because of past antecedents and real analysis that has been done, the public is not convinced that the subsidy removal will translate into the economic well-being”.
He explained that there were ways the government could do it such that it does not adversely affect the people if the government was sincere.
“If the government is sincere, there are ways they can do it in such a manner that the common man on the street will begin to see the positive impact of the subsidy removal.
“First, is providing an employment support for those that are not employed. Secondly, ensuring that there is steady power in the country, where you don’t need to use generator to generate private power.
“If there is adequate power supply, you don’t need to buy fuel to run your own private power generating set, then you’ll be saving so much cost and also the government needs to look at the common masses that are not even employed with either the government or private sector.
“They are self-engaged, they have their own small private companies so they need to survive and the government needs to look into how to translate the benefits to them”, he added.
For Mr. Patrice Onogu, CEO, Fracserve Africa Ltd. “the past eight years in Nigeria, the oil and gas industry, has been suffering and smiling, even as you have got the PIB Act signed.
“Yeah, it’s a good thing it has been there for many years, but unfortunately it was together only a few months back and it was signed into law, it’s a good thing but unfortunately again, the International Oil Companies (IOCs), those are the international investors, seem not to be very receptive about that, so in one hand it has affected the industry.
“Secondly, instability in terms of foreign exchange made a lot of oil companies, that is the IOCs, not to invest in the sector and that has really cost so much in terms of job loss and economywise. So, all those put together have not really made the sector to fare very well”.
Additionally, he said the removal of Fuel Subsidy means different things to different people, “the oil subsidy removal is different strokes for different people: you know, some people are happy, some people said no it is bad, while some people argue that we do not really have oil subsidy”.
Onogu stated that the Managing Director, NNPC, Mele Kyari, claims that within a few weeks of subsidy removal, the nation made trillions of naira, wondering who is who?.
He corroborated the previous respondent that, “employees are going to suffer because now officially things will skyrocket, prices will go up, landlords will hike their rents, the average food seller in the market will increase their prices and it’s not going to go well for an average employer or employee”.
He emphazised that there would certainly be job loss, noting the economy had not picked up “before this bang happened”.
He observed that there were countries, including Dubai, which produces more crude than Nigeria, where petroleum products are not cheaper, “but the thing is because of the fraud that is involved in our own scenario, it makes it a lot different, but people are arguing, which is also a very valid point that if we had had the palliative in place, the rail system working, the bus system working, power sector working, and you increase it there’s no problem.
“An average hairdresser now will hike the price from 500 to 1000 because of petrol, they don’t have power regularly. So, definitely the multiplier effect is going to be huge. There’s no doubt about that”.
He also complained about the poor condition of the roads, saying, “the condition of the roads have always been an issue. You know the tanker drivers, today they are on strike, tomorrow they have called off, because either the police is harassing them on the road or their trunks are falling off the road plus cost of maintenance and replacement of tires. So, if the Federal Government would fix the roads that will be great”.
He suggested the use of rails and flow stations to get petroleum products to other parts of the country for ease of transportation and product security and safety of the populace.
Miss Jessica Uzonwanne, a dealer in fabric in Port Harcourt, complained about the hike in transportation, saying that prices have more than doubled, which has affected the price of commodities.
She said, “everything has gone really high it is surely going to affect everything. For us in the fabric markets we just have to sell off our goods because it’s not something you would keep, fashion keeps changing and so we must sell with very little profit margin.
“If you add too much, your customers will just complain that the price is too high and you find yourself losing customers and losing business, which will likely lead to you closing shop.
Uzonwanne also said the cost of running generator has also doubled as the price of fuel has gone up from N87 to N 520 in the last eight years.
According to her, “cost of running generator now is very high as against previously when we can just buy one or two liters with little money, but now we have to budget seriously for private power generation and it’s not funny.
Another respondent, Cheif Executive Officer, Tinafac limited, an Oil and Gas logistics company, Mr. Timikeyi Bubagha, simply said “in the last eight years, everything has been crazy: cost of doing business has increased tremendously, especially for the past 2 weeks, everything has skyrocketed.
“Formally, for a truck to enter into Port Harcourt from Onne Port, it would cost N230, 000, but today it is N350,000.
Bubagha noted that the incessant increases in price of petroleum products in the last eight years have made nonsense of the ease of doing business policy in the country: “the hike in the fuel prices have terribly affected our businesses, because currently, so many companies are now thinking of buying their own trucks and doing their trucking themselves so you can imagine how many jobs and businesses that will be lost in the industry”.
He observed that with the high cost in transportation business, the workers in the industry would be asking for a raise, noting that they also pay transport to work.
“However, Bubagha pointed out that if the employer is not able to accommodate such raise in salaries, they would downsise”, which he stated, would lead to increase in unemployment.
He called on the authorities concerned to quickly do something, especially in multiple taxation, “because you pay for a lot of things so many taxes, so many things that we pay for.
“For instance, we pay heavily for private power generation. If we stay 10 hours in the office per day, we use diesel throughout and we all know the impact of that on business owners.
“You buy fuel for logistics vehicle, for your personal car, for generator both at home and work place. This is utterly crazy if you ask me. If they can give us light for 15 hours per day, it will help us in our business.
“Oh, and the roads are so bad that they affect us in so many ways. The other day an importer was coming into Port Harcourt with a trailer load of bathroom wares and because of the poor condition of road, the trailer tipped and fell over and all the bathroom wares fell out that were shattered. That importer has lost millions of Dollars.
“So, two most important things the government must do is to fix our electricity supply and fix our roads”, he suggested.

By: Soibi Max-Alalibo &Tonye Nria-Dappa

Oil & Energy

‘Revamping Moribund Refineries ‘ll Address Rising Cost Of Petroleum Products’

Published

2 months ago

September 21, 2026

The Tide

An Energy Expert, Dr Joseph Obele, has called on the Federal Government and the management of the Nigerian National Petroleum Company Limited (NNPCL) to urgently restart the government – owned refineries insisting that it would help in curbing the rising cost of petroleum products.

He insisted that bringing back the moribund public refineries would further serve as a direct response to the plight of Nigerians as far as petroleum products is concerned.

Obele, who is also the Public Relations Officer (PRO) of the Petroleum Products Retail Outlets owners Association of Nigeria (PETROAN) and Lecturer at the Ignatius Ajuru University of Education, Port Harcourt, while reacting to the cost of petrol said the immediate and practical approach to addressing the current increase in petroleum prices is to restore production at the government-owned refineries and maximise every available refining capacity in the country.

“The immediate approach to the recent rise in petroleum prices is to restart the government-owned refineries”, he said.

Obele insisted that restoring functional government-owned refining capacity would increase domestic supply, reduce dependence on imported refined petroleum products and contribute to greater stability in the downstream petroleum market.

He urged the federal government to maximise all available refining capacity while continuing to encourage responsible private-sector Investment and healthy competition within the downstream petroleum industry.

Obele expressed concern over the continued rise in crude oil prices amid the ongoing tensions involving the United States and Iran and concerns around the Strait of Hormuz, warning that sustained supply risks could continue to put pressure on global petroleum prices.

He noted that Brent crude closed at about $105.83 per barrel on 16 September 2026, while WTI closed at about $102.43 per barrel.

The impact, the expert said, is already being felt in the Nigerian downstream market, with Premium Motor Spirit (PMS) reportedly selling in the range of ?1,400–?1,500 per litre in some locations, while Automotive Gas Oil (AGO) is selling above ?2,000 per litre.

“The immediate approach to the recent rise in petroleum prices is to restart the government-owned refineries”, Obele said.

According to him, restoring functional government-owned refining capacity will increase domestic supply, reduce dependence on imported refined petroleum products and contribute to greater stability in the downstream petroleum market..

He warned that a prolonged increase in petroleum prices would have a wider economic impact, particularly on transportation, food, medical services and other essential commodities.

“The continuous increase in the cost of petroleum products will invariably affect the prices of virtually all commodities and services. It will create additional inflationary pressure and deepen the financial hardship being experienced by Nigerians”, he stated.

Obele noted that the prolonged dormancy of government-owned refineries has had serious economic and employment implications across the petroleum value chain, affecting workers, contractors, marketers, transporters, businesses and other dependants of the sector.

According to him, a functional Port Harcourt and Warri Refinery would stimulate activities across the petroleum value chain, support employment and restore confidence among industry stakeholders.

In his words, ‘the Port Harcourt Refinery should become a measurable demonstration of government’s commitment to the welfare of Nigerians”

He further noted that the Port Harcourt Refinery had previously recorded production activities arguing that the focus should now be on resolving operational challenges and returning the facility to sustainable production.

“The time to restart the Port Harcourt Refinery is now. Nigerians cannot continue to bear the unbearable cost of petroleum products when domestic refining capacity is available. Every viable refinery should be optimally utilised in the national interest”

Obele emphasised that the objective should not be to undermine private-sector refineries but to ensure that all viable refining assets—government and private—contribute to national energy security, adequate supply and a competitive downstream petroleum market.

Lady Godknows Ogbulu

Oil & Energy

The Race To Cut Methane Emissions Is Exposing A Global Divide

Published

2 months ago

September 21, 2026

The Tide

Several countries worldwide have been working to reduce methane leaks, with some states making significantly more progress than others. The establishment of the Global Methane Pledge in 2021 at the COP26 climate summit has helped accelerate cleanup efforts; however, many countries are still falling behind on their methane-cutting pledges. Now, one of the world’s biggest methane polluters – Turkmenistan – is aiming to plug its mega leaks, which would help reduce global methane emissions and could encourage other countries to do the same.

The United States and the European Union led the Global Methane Pledge, which has since been signed by 159 countries that together contribute around 45 per cent of global human-caused methane emissions. The pledge aims to reduce methane emissions by at least 30 per cent below 2020 levels by 2030.

Many governments had already made ambitious pledges to reduce carbon emissions, but some had not previously sought to cut methane emissions, which heat the planet up to 80 times more than carbon dioxide over two decades. Methane has contributed around 30 per cent of the increase in global temperatures since the Industrial Revolution, and fossil fuels contribute around one-third of the methane emissions from human activity. Record production of oil, gas, and coal, combined with limited mitigation efforts, has kept emissions above 120 million tonnes (Mt) annually, according to the International Energy Agency (IEA).

The IEA’s annual Global Methane Tracker shows how much methane is emitted each year and tracks progress and failures. In 2024, abandoned wells and mines accounted for roughly 8 Mt of methane emissions, demonstrating the severity of leaving them unplugged. It is extremely hard to track methane emissions as they are widely underreported. Some parts of the world have little or no measurement-based data on methane emissions.

Therefore, the IEA has to rely on data from scientific studies, measurement campaigns, and large emissions events detected by satellites to estimate emissions each year. Some regions of the world, such as Europe, report their methane emissions far more accurately than other parts. The IEA estimated that global energy-related methane emissions are about 80 per cent higher than those reported by countries to the UN Framework Convention on Climate Change.

Some countries contribute heavily to the world’s methane emissions, particularly oil-rich countries that have not effectively decommissioned fossil fuel operations for decades, including Turkmenistan, the United States, Russia, Iran, and Venezuela. A 2023 Guardian assessment revealed that Turkmenistan was the worst country for methane mega-leaks. Some of Turkmenistan’s “super-emitters” leaked tonnes of methane every hour, from a single valve or pipeline, which is more than the emissions from an entire coal-fired power station. The assessment showed that the methane emissions alone from Turkmenistan’s two main fossil fuel fields contributed more to global heating in 2022 than the United Kingdom’s entire carbon emissions. The findings have led to significant public backlash and put pressure on the government to address the problem.

This year, Turkmenistan approved a massive clean-up project, as the country started plugging its mega-leaks. Turkmenistan has halted eight leaks by repairing corroded pipes, faulty wells, and failing flares, according to data from the United Nations. However, significant work is needed to reduce the country’s methane emissions. The UN Methane Alert and Response System (MARS) has delivered 192 alerts of methane plumes to Turkmenistan over the last year. According to the system, Turkmenistan had nine of the world’s top 50 worst methane leaks of the last six months.

Turkmenistan has improved its reporting systems in recent years and responded to around 20 per cent of the alerts with on-the-ground information about the leaks and potential plans to fix them. By comparison, the United States was sent 138 alerts and did not respond to any. The worst detected methane leak came from Mexico’s offshore oil and gas operations and measured a huge 37 tonnes per hour, equivalent to the emissions of over 7 million SUVs. Although Mexico responded to all 23 MARS alerts, it has yet to fix the leak.

Meghan Demeter, the programme manager of MARS, stated, “These mitigation cases are a proof point of what can be done with satellite data, especially in situations like Turkmenistan, where there are a lot of detections… This is a breakthrough in terms of having real documented mitigation action. But it is not yet a breakthrough in the overall magnitude of emissions. Eight cases is an incredible first step, but there are also a lot more sources in Turkmenistan that need to be addressed. We are in pretty constant communication, and the response rate is growing month by month. We’re seeing steady progress.”

UN tracking has also encouraged other countries in the region to plug leaks, with Kazakhstan, another former Soviet republic with ageing oil and gas infrastructure, stopping eight leaks following alerts. To date, Mexico, Brazil, and Argentina have 100 per cent response rates to MARS alerts, while Libya and Azerbaijan have high response rates. Meanwhile, the United States, Iran, Russia, and China failed to respond to any alerts.

By Felicity Bradstock for Oilprice.com 16

Oil & Energy

Delta Targets 120MW Power Boost, Moves To Cut Reliance On National Grid

Published

2 months ago

September 7, 2026

The Tide

The Delta State Government has intensified efforts to boost electricity generation and supply in the state with plans to add 120 megawatts (MW) to the national grid through a partnership with Supply Power.

The State Commissioner for Works (Rural Roads) and Public Information, Charles Aniagwu, disclosed this at a press conference in Asaba, weekend, noting that the initiative was part of wider reforms aimed at opening up the power sector to private investors.

Aniagwu, who was accompanied by the Executive Assistant to the Governor on New Media, Felix Ofou, said the state was exploring alternative sources of electricity to support businesses, households and communities while reducing pressure on the national grid.

He said the government was particularly interested in exploiting Delta’s abundant natural gas resources for power generation, pointing to the Kwale Free Trade Zone, which is part of the state’s special economic zone, as a major opportunity for investors.

According to him, prospective investors were taken to the zone during the state’s recent economic summit to enable them to assess the availability of gas as a key raw material for electricity generation. ComparePower Rates

The commissioner explained that generating more electricity locally would not only increase supply in Delta but also free up power on the national grid for use by other consumers.

Aniagwu cited the 8.5MW Independent Power Plant located behind the state secretariat in Asaba as an example of what could be achieved through alternative power sources.

He said the facility had enabled the secretariat complex to operate independently of the national grid, thereby making the electricity that would otherwise have been consumed there available to other users.

He added that the planned 120MW partnership with Supply Power would further strengthen the state’s electricity supply capacity and provide a more reliable power base for small and medium-sized enterprises.

Aniagwu said the state government was also intervening in areas traditionally regarded as the responsibility of electricity distribution companies because inadequate power supply could no longer be allowed to constrain economic development. LearnQuantum Physics

He identified the extension of the electricity grid from Abraka towards the Ndokwa axis as one of the interventions being undertaken to connect more communities to electricity.

The commissioner, however, raised concerns over the burden placed on communities that are often required to provide transformers and other electricity infrastructure, only for distribution companies to take over the facilities and subsequently collect electricity bills without adequately accounting for the investments made by the communities.

He said the state would continue to support efforts aimed at energising communities, noting that improved electricity supply would stimulate businesses, create jobs and help tackle social problems associated with unemployment and idleness.

On regulation, Aniagwu said the government was working with the Ministry of Energy and a committee set up to develop an appropriate regulatory framework for the state’s emerging power sector. SwitchEnergy Plans

He said the proposed energy commission would be responsible for regulating new electricity producers, determining appropriate tariffs and overseeing distribution networks.

The commissioner stressed that liberalising the sector required effective regulation to protect consumers and investors, adding that decisions on power distribution infrastructure, including the use of overhead or underground lines, must take into account the peculiarities and safety requirements of each location.

He warned that power expansion without adequate regulation could expose residents to electrocution and other hazards, stressing the need to protect electricity infrastructure while ensuring consumers were not subjected to unfair pricing.

Aniagwu said the state government’s broader objective was to build an efficient and sustainable electricity market driven by private investment and capable of powering businesses, households and communities across Delta State.