Business

Nigeria: Avuru, Co-Founder Seplat Energy, Calls for State of Emergency in Oil Sector, Says 80% of Crude Stolen

Published

3 years ago

March 21, 2022

By Derrick Bangura

Mr. Austin Avuru, a co-founder and former CEO of Seplat Energy Plc, has called for a state of emergency in the Nigerian oil and gas sector, claiming that up to 80% of oil extracted in the country, mainly in the east, is stolen.

Mr. Tony Elumelu, Chairman of Heirs Holdings, decried the deteriorated situation of the industry a few days before Avuru’s remarks, stating that around 95% of oil production does not make it to the port. Elumelu’s oil holdings are in the Niger Delta.
Elumelu also chairs the Board of the United Bank for Africa (UBA), holds a controlling interest in Transnational Corporation (Transcorp) and runs Trans-Niger Oil & Gas Limited (TNOG).
The owner of TNOG, which recently bought 45 per cent of Oil Mining Licence (OML) 17, argued that oil theft was generally responsible for Nigeria’s inability to meet its Organisation of Petroleum Exporting Countries (OPEC) quota.

“How can we be losing over 95 per cent of oil production to thieves? Look at the Bonny Terminal that should be receiving over 200,000bpd barrels of crude oil daily, instead it receives less than 3,000 barrels, leading the operator, Shell to declare force majeure,” he had lamented.

But writing for Africa Oil & Gas Report, Avuru, who is the Founder/ Executive Chairman, AA Holdings and Vice Chairman Platform Petroleum, maintained that as far as 1990, Nigeria’s average daily oil production was about 1.85 million barrels per day when the country’s oil reserves at the time stood at about 16 billion barrels.

However, he deplored the current situation in which Nigeria cannot meet the quota allocated by OPEC and had been struggling to produce 1.4 million barrels per day. He argued that aside theft of Nigeria’s oil, with eyes fixed on divestments and exit, the International Oil Companies (IOCs) have not made any meaningful investments in the sector in the last 15 years, with the result being the current declining production.

“Much worse, the entire export pipeline network has been surrendered to vandals and illegal ‘bunkerers’. Thus, the phrase ‘crude theft’ which crept into the industry about 2010 has taken on a new meaning.

“There are some pipeline systems now (particularly in the East) where 80 per cent of production injected therein does not make it to the terminal! Almost every producer is now cooking up alternative evacuation schemes that cost four to five times what pipeline export would normally cost,” he lamented.
Avuru noted that while the decision to leave by the IOCs was outside Nigeria’s control, the country’s delay in passing the Petroleum Industry Bill (PIB) ensured that investment in the sector dried up a long time ago.

“In fact, my projection is that, by Christmas day of 2025, Total would be the only IOC in Joint Venture (JV) with the NNPC,” he said.
He pointed out that the situation was not different with domestic gas delivery, adding that even though Nigeria continues to weave all the right slogans about the future of gas in Nigeria, in the past five years, he could only point at a couple of Nigerian independents who are investing in gas development and processing for the domestic market.
“The state of the Nigerian petroleum industry is a national emergency. Oil production is down to about 1.4 million barrels per day and declining and this includes about 600,000BOPD from the deep water.

“Domestic gas production has stagnated at about 1.2 billion cubic feet (Bcf) per day over the past five years at a time when projected production should have been 3.5Bcf per day. The collateral impact of course, is the low level of power generation which itself has stagnated at about 4,000 megawatts per day since 2015,” the businessman said.
On recommendations, Avuru stressed that between the upstream regulator (the commission) and the Nigerian National Petroleum Company (NNPC), they need to set up a, “war room”, or some form of an effective task force to develop a blueprint for returning the industry to full bloom.

“The responses we hear today to the myriad of problems outlined above have been ad-hoc, knee jerk and in some cases only self-serving. I dare repeat that the situation has to be treated as a national emergency,” he explained.

He argued that a well-organised transition driven policy direction, from the retreating IOCs’ needs to be developed, noting that intervening by pre-emptive acquisitions cannot be a sustainable solution proffered by the NNPC.“There has to be a deliberate policy-driven return to the traditional onshore/shallow water terrains. Eighty per cent of our remaining reserves are still in this belt.

“To do this, we have to address the twin problems of reliable pipeline evacuation and community restiveness. These problems have become heightened, not because there is no solution, but because we have abandoned every attention to them in the last 15 years.
“When these two problems are tackled, plus a strict application of the ‘drill or drop’ provisions of the new PIA, huge investments in drilling and facilities revamp will flow again into this terrain.

“Finally, we have to match our gas slogans with effective, measurable, policy actions to drive investments in domestic gas supply. The current flip-flops on pricing and commercial structure of the gas business cannot stimulate investments in the sector.

“This industry will not wake up by God’s miracle. We have to wake up and design the stimulant that will revitalise it,” Avuru said.
Sylva: Nigeria Will Not Support Single Track Energy Transition Strategy

Meanwhile, the Minister of State, Petroleum Resources, Mr. Timipre Sylva, said yesterday that Nigeria was not in support of any narrative that supports a single lane energy transition strategy.

The minister insisted that Nigeria would remain at the vanguard of the crusade for a multifaceted energy transition timetable that will attract more investments for Africa, while taking cognisance of the current global drive towards renewables.

A statement by the Senior Adviser (Media & Communications) to the minister, Horatius Egua, quoted Sylva as having made the declaration on the heels of a collective decision by African petroleum and energy ministers to present a common voice at COP 27, in Egypt.

The minister insisted that Africa should be allowed to continue to exploit its hydrocarbon deposits for the development of the continent, rather than being stampeded into a process which does not fully benefit its people.

“Nigeria will continue to drive the direction of the narrative for the African energy transition programme. We have stood out to say ‘no’ to a single track energy transition programme.
“We will continue to support a transition agenda that will promote gas and renewed investments in the hydrocarbons sector for Africa,” Sylva said.
According to the statement, Sylva, and the Egyptian Energy Minister, Terek el Molla had been the main voices in articulating a multi-track approach to the energy transition programme for Africa.

“Both leaders are of the view that for the energy transition programme to be meaningful, Africa must be factored into the global energy transition programme in such a way that takes care of the peculiar African situation.
“Nigeria will continue to advocate for gas as a transition fuel for Africa. We have said that we cannot move at the same pace with the rest of the world because we contribute less than two per cent of the global greenhouse gas emission. We are not the problem and we cannot be made to pay for the sins we did not commit,” he stated.

The minister added that for anyone to say Africa should abandon its abundant hydrocarbon deposits for the uncertainties of renewable energy was most unfair.
He noted that as at today, there are still people without clean cooking fuels in Africa, explaining that over 600 million people are without basic energy.

“So, how do we meet their energy base load? We can only achieve this through gas. It’s only through a multi-pronged approach that we can achieve this. It is obvious that we cannot move at the same pace with the rest of the world as far as the energy transition programme is concerned,” he maintained.

At the just concluded CERAweek, in Houston, United States of America, the statement noted that Sylva and el Molla led other African ministers to meetings where they resolved to project a common front in the energy transition timetable for Africa.

“We have a huge hydrocarbon deposits in the continent and must we abandon it because some people have said we should? Some African countries like Ghana, Angola and others are just coming to the table and should they just abandon what they have because some countries are saying we should develop renewable energy? That will be an unfair decision.

“We are not saying we won’t be part of the transition train for renewable energy but what we are saying as Africans is that we should be allowed to develop our natural resources and enjoy the God-given resources.

“I am happy that the world is beginning to listen to Africa and we are happy about that and we intend to build on that momentum at COP 27 in Egypt by coming out with a common position,” he noted.

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Businesses count losses amid power outage in Bauchi, Gombe, and Jigawa

Published

2 months ago

October 28, 2024

Matthew Eloyi

Business owners in Bauchi, Gombe and Jigawa are recording losses due to week-long blackout ocassioned by vandalism of the power transmission line in parts of northern Nigeria.

The sudden disruption in electricity supply in the past days, also affected essential services such as water, sanitation, street lighting and healthcare delivery as most hospitals have been operating without light.

Some of the affected businesses including shop keepers, millers and artisans, who spoke while reacting to a survey by the News Agency of Nigeria (NAN), described the situation as “pathetic”.

The survey examined the perennial collapse of national grid and the need for alternative power supply in the country.

Rice millers in Gombe had decried the impact of the erratic power supply on their businesses.

A Miller, Musa Arab, at Nassarawo Industrial Layout in Gombe, said the trend was crippling their operations as they relied on electricity supply from the grid to process paddy.

He said the mills were not operational power outage as they could not afford exorbitant pump prices of petrol or diesel to run their machines.

This, he said, reduced the volume of rice supply to the market and posed serious challenge to food security.

“We must invest in power because it is the biggest determining factor for industries to thrive.

“I have over 20 workers in my mill, and we have 100 mini rice mills here, so you can imagine those who have no jobs for the past 10 days.

“Government must go tough on those responsible for the perennial grid collapse because some persons may be benefitting from it,” he said.

Also, Yusuf Ibrahim said the situation might trigger the already fragile inflation, as prices of local varieties would shot up ocassioned by the diminish supply.

He said that some had jerked up their charges to cover the expenses on diesel thereby affecting rice prices.

A check by NAN at the Gombe Main market showed that a 100 kilogramme of rice was sold for between N120,000 and N160,000, as against N110,000 and N150,000, before the blackout.

Mr Usman Sani, a rice dealer, attributed the hike in price to low supply of the produce to the market in spite of the number harvest recorded this cropping season.

He said the prices had decreased slightly at the onset of the harvest, however, it showed sprawling increase due to power outage.

“The price of rice is already dropping as a result of harvest but the trend reverse since the blackout in the past days “ he said.

Ugochukwu Daniel, a bartender in Bauchi, decried the epileptic power supply in the country, adding that lack of durable energy supply would retard Nigeria’s quest to attain social and economic greatness.

Daniel said that she spent much on fuel to run power generator for refrigrator and lightening the beer parlour, to enable her to keep the business running.

He said that businesses could only thrive in an enabling environment with stable electricity supply, to enhance wealth creation and reduce poverty among Nigerians.

“My trade is about chill drinks and it survives on electricity to operate otherwise you will out of bussiness.

“Without electricity there is nothing you can do, and not only business but about everything. We depend on it,” he said.

Similarly, Samuel Adamu, said the persistent power outage had forced him to patronised charcoal for ironing clothes in spite of its high cost and cumbersome processes.

He said that most cleaners in the area had resorted to fabricated iron charcoal in spite of hike in its prices which suddenly jumped from N5,000 to N15,000.

Adamu said the situation also encouraged division of labour in laundry to cut cost and make some gains.

“Presently, I do wash the cloth, and engage someone for ironing. The charge is N300 per set as against N150”.

While advocated development of renewable energies to enhance power supply in the country, Adamu urged security agencies to entensify efforts towards electrical installations in the country.

In the same vein; Mr Muhammad Adamu, Chairman, Jigawa State House Assembly Commitee on Power and Energy, said the Jigawa Electricity Law 2024, made sound provisions to improve power generation and distribution in the state.

This, he said, was an offshoot of the devaluation brought about by the 5th alteration of the constitution, where removed power from the executive legislative list and to the concurrent list.

“It empowered the state houses of assembly to enact laws on power.

“The committee has also carefully pursued the bill and reviewed its structure and the promise it holds for the state power sector, infrastructure and the overall economy of the state.

“The new law will pave way for the establishment of Jigawa Electricity Commission, to regulate the state’s electricity market,” he said.

According to Adamu, the law will protect residents and investors in the energy sector through ensuring prepaid meter installation and possibility of recouping investor’s funds as well as address vandalism.

“The law will lead to provision of reliable, affordable and sustainable power, essential for development of all sectors of the economy, particularly in rural areas,” Adamu said.

“Vandalism will be over because we pay Kano Electricity Distribution Company (KEDCO) money for powered supplies, but whenever there is problem of damages or broken down transformers, it is either the communities or individuals that pay for the repairs”.

Business

Mercedes urges delay of EU tariffs on Chinese electric vehicles

Published

2 months ago

October 21, 2024

Matthew Eloyi

Mercedes urges delay of EU tariffs on Chinese electric vehicles

The head of German luxury carmaker Mercedes-Benz, has called for the European Union to de-escalate the dispute with China over tariffs on electric cars.

“We need more free trade instead of new trade barriers.

“That is why it is important to find a solution that suits both the EU and China,” chief executive Ola Källenius told the Monday edition of Bild newspaper.

“The negotiations for this take time. In order not to jeopardise them, the EU should postpone the enforcement of the planned tariffs,’’ he said.

At the start of the month, a majority of EU countries paved the way for additional tariffs of up to 35.3 per cent on battery-powered electric vehicles imported from China.

Germany, however, voted against the measure amid concerns over retaliatory actions which could hurt the country’s giant car industry.

The European Commission had pressed for extra tariffs after an investigation accused Beijing of subsidising domestic electric car manufacturers, and thus distorting the market in the EU.

But whether the import tariffs would actually come into force at the beginning of November is still up to the commission.

The plans can still be dismissed if Brussels reaches a solution with China at the negotiating table.

Business

ACCI moves to promote business connections, balance work-life

Published

2 months ago

October 16, 2024

Matthew Eloyi

ACCI moves to promote business connections, balance work-life

The Abuja Chamber of Commerce and Industry (ACCI), is taking innovative steps to enhance professional relationships and promote a healthy work-life balance.

The President of ACCI, Dr Emeka Obegolu, said this in a statement on Tuesday in Abuja.

Obegolu said ACCI was committed to creating environments where professionals could connect beyond the confines of traditional boardrooms.

He said the upcoming “Business Meets Golf’’ Tournament epitomises this vision.

“Scheduled for Oct. 18 to Oct 19 at the IBB Golf Club, the tournament will gather industry leaders, top executives, and key decision-makers for a unique networking experience.

“This two-day event aims not only to strengthen business ties but also to foster partnerships that can drive economic growth.

“The ACCI’s initiative reistates the importance of maintaining a balance between professional achievement and personal well-being.

“By encouraging corporate cultures that prioritise relaxation and self-care, the Chamber acknowledges that such balance is vital for productivity and overall success,” he said.

According to Obegolu, the event will feature a range of activities designed to facilitate both business engagement and relaxation.

“Highlights include a Business-to-Business (B2B) cocktail on the first day, followed by the golf tournament and additional networking opportunities on the second day.

“The tournament will culminate in an awards ceremony recognising outstanding golfers among the participants.

“‘Business Meets Golf’ exemplifies our dedication to fostering innovative networking opportunities.

“We aim to create spaces for meaningful discussions that can lead to impactful collaborations,” Obegolu said.

The ACCI boss said in addition to promoting business connectivity, the council aimed to restate the importance of relaxation and a balanced lifestyle.

Obegolu said through events like this, the Chamber continued to play a pivotal role in supporting trade and industry in Nigeria while driving sustainable growth within the private sector.

He said to raise awareness about this landmark event, ACCI was partnering with the News Agency of Nigeria (NAN) and Media Trust Limited, to ensure broad visibility and engagement from leading brands.