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IOCS And GMOU Implementation

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A critical  component of the operations and activities of international oil companies (IOCS) in Nigeria, is in the area of community relations. There  is a symbiotic relationship between (IOCS)  and their host communities, and this relationship determines the success or otherwise of the prospecting oil companies in their areas of operation.

However, activities of most of the IOCS  in the Niger Delta had been fraught with conflicts, resulting from the absence of an agreeable community engagement concept that will satisfy the yearnings of the host communities, as well as the corporate  objectivities of the prospective companies.

Consequently, the evolving crisis had brought  untold  consequences  on the  corporate  partners, with a negative  prospect of devaluation of the core values of sustainable development  and corporate  social responsibility  policies in  line with international best practices.

In most communities, such sharp disagreement and lack of consensus had resulted in the  wanton destruction of lives and the facilities of the oil companies.  The ugly trend stifles the growth and expansion of activities of the affected oil companies and also create disharmony  among the host communities.

Analysts had however attributed the perennial  conflicts between oil companies and their host communities in the Niger Delta to what is commonly referred to as “conceited  development  policies”.

Such policies according to analysts, places  the host communities  in an equal partnership with the oil companies, as they are always  at the receiving end and not direct   participants in the process of planning, and execution  of development projects of which they are direct beneficiaries.

This approach to community development, believed to be lacking in consultation had over the years triggered suspicion and mutual  distrust  among oil companies and their  host communities, thereby negatively affecting the prospect  of  a thriving  partnership and corporate  growth  among  IOCS and their  host communities.

However, considering their staggering investment, and also realising the consequences of mutual corporate distrust, arising from the lack of a more acceptable community development model, IOCS are beginning  to evolve a new concept aimed  at attaining its corporate goals.

One of such measures aimed at responding to the imperatives of corporate social responsibilities, in the area of community relation is through the Global Memorandum of Understanding (GMOU) which  companies  now sign with communities neighbouring  their  clusters of operation, on agreeable terms.

The new model  which is based on direct participation by the host communities is structurally targeted at addressing past  development lapses and consolidate a thriving partnership between companies  and their host communities.

Most oil  companies  have keyed into the GMOU, process through the  Nigerian National Petroleum Corporation, NNPC Joint Venture. In the course of gathering  confidence in the strategic implementation of the GMOU process, companies  are also expanding the frontiers through  partnership  with Development Agencies   such as the Niger Delta Development Agency NDDC, and the various levels of government.

At the drive of the GMOU process, in Rivers, gathers momentum Chevron Nigeria Limited had taken advantage  of the  community  engagement model to promote it corporate objectives within  communities neighbouring  its clusters of  operation in the state.

Recently at  the Second Annual General  meeting of the Kula Regional Development  council, a body elected to manage the GMOU in Kula Community, the management  of Chevron, used the opportunity to take stock and rekindle its commitment to the process.

The management of the company, which was represented by, Mr. Ngo Kio at the event, expressed appreciation  over  the effort of the Kula RDC in the utilisatioin of available  fund for the  development  of the community. He said the GMOU as a successful  replacement  to the old system  of direct contact  with individual communities, will continue to receive the attention of the company   to promote a harmonious  relationship between  them and the host community.

He also commended its development  partners such as the NDDC, the Rivers State Government  and the Akuku Toru LGA, for the  support and expressed hope that “the interface  will bring  lasting peace in the Niger Delta.”

The Chevron management assured that communities will be encouraged  through funding and capacity  building  to take decisions on their development  process, while the GMOUS will be periodically reviewed based on terms of agreement.

Chairman of the Kula RDC, Hon Stanley Benibo also commended the  management  of Chevron for their   unflinching support to the GMOU process and assured that all money  giving by the company for the GMOU will be judiciously used. Hon Benibo however, cautioned against the erroneous impression by some community members that money voted for the GMOU process should be shared among the people.

According to him “It was disservice to the people for people not to pay back loans collected from the GMOU fund”, and also condemned  the attitude of some beneficiaries  of the evolving transport  scheme who  refused to pay back the money based on terms  of agreement. Such  attitude  he pointed out will  affect the maximal impact of the fund on the people.

In his remark, the Amanyanabo of Opukula, HRM, Dan Opusinji, cautioned against division among the people  and said lasting peace can only return to the embattled Kula community when the people speak in one accord.

Also commenting at the commissioning of Four housing units, at Robertkiri, Boro; Afforiaina, and lucky land, all in Aku LGA, recently, Barr, Charles Opurum who represented  the Rivers  State  Commissioner for chieftaincy  Affairs. Mr. Charles  Okay, suggested to  Chevron, to create  and alternative measure  of dealing directly with Traditional Rulers, rather than the RDCS. He noted that Traditional  rulers as the custodian of the traditional values  deserves, such  Prime attention. He said  RDCS should always  ensure that accountability  is the watchword  to avoid profligacy and mismanagement of available fund.

Similarly, other multinationals, such as total exploration, Mobil Nigeria, Pan Ocean  Limited among others has also adopted direct community engagement  models as approaches of stemming the  pace of disagreement among them and their host communities to avert the drift in sustainable community development .

Another  critical aspect of the GMOU process which  analysts  has canvassed support for is the area of domestication of the  local content policy through  the empowerment of  local  contractors. However, analysts are of the view, that while indigenous  contractors should benefit from the policy, effective monitoring should be put in place to ensure that projects awarded to them are completed according to specification. This arises from the growing tendency  of abuse of projects by indigenous contractors who see projects as means of appeasement rather them platforms for collective economic benefits to the people.

Also in line with the principles of international   best practices in the oil and gas sector, the Rivers State government has through its supervisory Ministry canvassed  for an effective and appropriate   energy policy in the State, especially in the area of community engagement, access to finance, regulatory  frame work and indigenous human capacity development through corporate partnership. These were  part of the recommendations of the international oil and gas  summit in the state.

 

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FG Explains Sulphur Content Review In Diesel Production 

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The Federal Government has offered explanation with regard to recent changes to fuel sulphur content standards for diesel.
The Government said the change was part of a regional harmonisation effort, not a relaxation of regulations for local refineries.
The Chief Executive, Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Farouk Ahmed, told newsmen that the move was only adhering to a 2020 decision by the Economic Community of West African States (ECOWAS) which mandated a gradual shift to cleaner fuels across the region.
Ahmed said the new limits comply with the decision by ECOWAS that mandated stricter fuel specifications, with enforcement starting in January 2021 for non-ECOWAS imports and January 2025 for ECOWAS refineries.
“We are merely implementing the ECOWAS decision adopted in 2020. So, a local refinery with a 650 ppm sulphur in its product is permissible and safe under the ECOWAS rule until January next year where a uniform standard would apply to both the locally refined and imported products outside West Africa”, Ahmed said.
He said importers were notified of the progressive reduction in allowable sulphur content, reaching 200 ppm this month from 300 ppm in February, well before the giant Dangote refinery began supplying diesel.
Recall that an S&P Global report, last week, noted a significant shift in the West African fuel market after Nigeria altered its maximum diesel sulphur content from 200 parts per million (ppm) to around 650 ppm, sparking concerns it might be lowering its standards to accommodate domestically produced diesel which exceeds the 200 ppm cap.
High sulphur content in fuels can damage engines and contribute to air pollution. Nevertheless, the ECOWAS rule currently allows locally produced fuel to have a higher sulphur content until January 2025.
At that point, a uniform standard of below 5 ppm will apply to both domestic refining and imports from outside West Africa.
Importers were previously permitted to bring in diesel with a sulphur content between 1,500 ppm and 3,000 ppm.
It would be noted that the shift to cleaner fuels aligns with global environmental efforts and ensures a level playing field for regional refiners.

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PHED Implements April 2024 Supplementary Order To MYTO

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The Port Harcourt Electricity Distribution (PHED) plc says it has commenced implementation of the April 2024 Supplementary Order to the MYTO in its franchise area while assuring customers of improved service delivery.
The Supplementary order, which took effect on April 3, 2024, emphasizes provisions of the MYTO applicable to customers on the Band A segment taking into consideration other favorable obligations by the service provider to Band A customers.
The Head, Corporate Communications of the company, Olubukola Ilvebare, revealed that under the new tariff regime, customers on Band A Feeders who typically receive a minimum supply of power for 20hours per day, would now be obliged to pay N225/kwh.
“According to the Order, this new tariff is modeled to cushion the effects of recent shifts in key economic indices such as inflation rates, foreign exchange rates, gas prices, as well as enable improved delivery of other responsibilities across the value chain which impact operational efficiencies and ability to reliably supply power to esteemed customers.
“PHED assures Band A customers of full compliance with the objectives of the new tariff order”, he stated.
Ilvebare also said the management team was committed to delivering of optimal and quality services in this cost reflective dispensation.
The PHED further informed its esteemed customers on the other service Bands of B, C D & E, that their tariff remains unchanged, adding that the recently implemented supplementary order was only APPLICABLE to customers on Band A Feeders.

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Oil & Energy

PH Refinery: NNPCL Signs Agreement For 100,000bpd-Capacity Facility Construction 

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The Nigerian National Petroleum Company Ltd (NNPCL) has announced the signing of an agreement with African Refinery for a share subscription agreement with Port-Harcourt Refinery.
The agreement would see the co-location of a 100,000bpd refinery within the Port-Harcourt Refinery complex.
This was disclosed in a press statement on the company’s official X handle detailing the nitty-gritty of the deal.
According to the NNPCL, the new refinery, when operational, would produce PMS, AGO, ATK, LPG for both the local and international markets.
It stated, “NNPC Limited’s moves to boost local refining capacity witnessed a boost today with the signing of share subscription agreement between NNPC Limited and African Refinery Port Harcourt Limited for the co-location of a 100,000bpd capacity refinery within the PHRC complex.
“The signing of the agreement is a significant step towards setting in motion the process of building a new refinery which, when fully operational, will supply PMS, AGO, ATK, LPG, and other petroleum products to the local and international markets and provide employment opportunities for Nigerians.

By: Lady Godknows Ogbulu

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