oil

Abuja, March 14, 2024: The Organisation of Petroleum Exporting Countries (OPEC) said crude oil output increased mainly in Nigeria and Libya, while production in Iran and Iraq decreased.

OPEC said based on secondary data sources, total OPEC-12 crude oil production averaged 26.57 mb/d in February with 203 tb/d higher, month-on-month (m-o-m).

OPEC said this in its Monthly Oil Market Report (MOMR) released for March.

The report stated that in February, Nigeria’s crude oil production rose to 1.476 million barrels per day (bpd) against 1.429 bpd recorded in January.

It said Libya recorded 1.167 m/bpd in February against 1.023 m/bpd recorded in January.

Conversely, the report said Iraq decreased in production from 4.217 m/bpd in January to 4.203 m/bpd in February, while Iran produced 3.148 m/bpd in February against 3.163 m/bpd.

According to OPEC, it obtains its crude oil production figures from two sources, either as Direct Communication by member countries or information released by secondary energy intelligence platforms.

The report further stated that Nigeria’s Gross Domestic Product (GDP) witnessed an increase of 3.2 per cent, year-on-year (y-o-y) in Quarter four of 2023 (4Q23).

OPEC said this led to an annual growth rate of 2.9 per cent for 2023.

This, it said, was primarily fuelled by advancements in the agricultural sector.

Abuja, Feb. 28, 2024: The Federal Government said on Tuesday that none of the International Oil Companies (IOCs) doing business in Nigeria has left as against insinuations.

Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, gave the clarifications during the inauguration of the ongoing Nigeria International Energy Summit (NIES 2024), at the Presidential Banquet Hall in Abuja.

He said the IOCs only shifted their portfolio and investments to offshore.

“I want to use this opportunity to assure everyone that no IOC is leaving Nigeria. They are only going deep offshore,” he said.

The minister said that the divestments by some of the oil companies would benefit the country, as the IOCs would be making further investments in the deep offshore.

The investments, according to Lokpobiri, will create room for indigenous companies to develop capacity within the onshore and shallow waters space.

“It is imperative to note that we are strategically managing the divestment processes.

“Our commitment to enhancing our crude oil reserves and production is unwavering, and we are actively exploring innovative solutions to attract investment, optimise operations and foster sustainable growth.

“We are open for business and ready to welcome your investments,” he said.

According to Lokpobiri, the transition to cleaner and more sustainable energy sources in the country is inevitable.

“We are actively pursuing initiatives to position Nigeria as a leader in this energy transition.

“As we navigate this change, Nigeria recognises the need to strike a balance between meeting our growing energy demand and reducing our carbon footprint.

“The diversification of our energy mix, investments in renewable energy and the adoption of cleaner technologies are all integral components of our strategy,” he added.

The minister explained that investments in Nigeria’s oil and gas industry declined by 69 per cent compared to the 28 per cent global average between 2017 to 2022.

“To further buttress the above, the capital investment to reserve ratio shows the amount of capital deployed to a country’s available reserves.

“Nigeria has an abysmal capital investment-to-reserve ratio of five per cent compared to Angola with 46 per cent; Brazil – 115 per cent; Mozambique – 92 per cent and Guyana – 617 per cent.

“The window for attracting new investments and exploring our vast reserves is fast narrowing; if the global energy transition accelerates, approximately 60 per cent of Nigeria’s reserves could be uncompetitive to produce.

“Against this backdrop, we have identified that there are so many licenses with proven reserves that are not being optimised in the hands of IOCs, NOCs, and others.

“In line with Mr President’s Renewed Hope agenda, we are working on changing this narrative,” he said.

Also speaking, Malam Mele Kyari, Group Chief Executive Officer (GCEO), NNPC Ltd., assured that its role in the divestment of the IOCs from onshore and shallow water assets in the country, would serve as a facilitator and not an obstacle.

Kyari said that by the virtue of its statutory mandate as the enabler of national energy security, NNPC Ltd.’s role would ensure optimal and sustainable production from the divested assets to guarantee energy security for the benefit of Nigerians.

He reitrated the company’s willingness to invest in the proposed African Energy Bank as a way of ensuring sustainable funding for energy projects in Africa, to guarantee energy security.

On investment in energy infrastructure to drive energy security, Kyari further said that the completion of the Obiafu-Obrikom-Oben Pipeline was in sight as the tunnelling across the River Niger was currently ongoing.

He assured stakeholders of the company’s commitment to work with them to close the energy deficit gap and create prosperity for Nigerians.

The NNPC helmsman ssid that from all indications, all issues of energy scarcity in the country would be over in the next 10 years.

The event saw the participation of key industry and governmental figures, including Haitham Al-Ghais, Secretary-General of OPEC and Omar Farouk Ibrahim, Secretary-General of the African Petroleum Producers’ Organisation, among others.

Lagos, Jan. 3, 2024: Some stakeholders in the oil and gas industry have projected a rapid economic growth for Nigeria in 2024, based on increased oil production for the year.

The stakeholders shared their views and expectations for this year in separate interviews on Tuesday in Lagos.

The stakeholders explained that Nigeria will during the period exceed its crude oil production target of 1.7 million barrel per day (bpd).

Dr Ayodele Oni, Partner, Bloomfield Law Practice, said that the oil and gas industry was one of the most impactful sectors in 2023.

Oni said that the sector, however, elapsed around mid-year in 2023, largely because of the decline in petroleum production, political uncertainty and theft.

According to him, there was  significant improvement in the fourth quarter of 2023 for the oil and gas sector.

“In terms of infrastructure, it has been a good year with projects like the AKK, Dangote Refinery, and marginal field production being witnessed.

“No doubt, 2024 will be very exciting for the petroleum industry,” he said.

The expert attributed the inability to  meet the  petroleum production quota in the year under review to theft and lack of key infrastructure.

To address these challenges, he advised the government to take steps to incentivise crude oil production and foreign investment in the sector, reduce petroleum theft as well as pipeline vandalism.

Oni noted that the government could also create proactive business environment for investors and develop key infrastructure within the industry.

“When incentives are introduced, they must not only be paper incentives but must be obtainable in reality and with ease,” he added.

He  also said that in  the period under review, the government, no doubt made significant improvements in petroleum refining.

Oni said that the first private refining facility owned by Dangote was commissioned while the existing refining facilities are being aggressively refurbished just as steps are being made to inaugurate new refinery projects.

“Similarly, in terms of gas policies, the government has continued to show its commitment to develop Nigeria not just as an oil-rich country but as a gas super power.

“Policies and activism have been demonstrated in developing the gas sector as much as the oil sector.

“In terms of the applicable law and deregulation, steps have been taken to ensure the enforcement of key provisions of the Petroleum Industry Act.

“Steps are actively being taken by key regulators to ensure that the oil and gas sector continue to have the right regulatory structure to support the growth being projected.

“The Compressed Natural Gas (CNG) project has been initiated by the federal government in recognition of the enormous gas potential of the country and the significant benefits offered by gas when compared to other fuel source.

“Whereas the key gas/CNG projects are currently in the incubation stage, significant progress is envisioned.”

He added that government had been very proactive in issuing out key policies and regulations that drive the growth of the petroleum industry.

He said that most policies had been practical with strong consideration for the economic realities, adding that without doubt, the government had been proactive in taking steps to the highest possible level.

While sharing his views, Oni said, “I expect that there will be a lot more dedicated efforts. New regulations will be passed to ensure certainty, key infrastructure projects will be completed to act as a backbone to the structure, and the challenges will be tackled more directly.

“The federal government will also do more around its fuel subsidy substitution approach with natural gas playing a critical role.

“No doubt it will be an interesting year with the likelihood of major improvements.”

He advised government to focus primarily on conducive investment-friendly ecosystem, reduce pipeline vandalism and crude oil theft, certainty of the regulatory, political climate and investment in key infrastructure.

Mr Joe Nwakwue, Partner, Zera Advisory and Consulting Ltd., described the overall business environment as challenging.

He, however, said that the development had stalled sectoral investment and activity levels.

Nwakwue said that PIA anticipated gains are slow mainly due to slow and tentative implementation of the law and issues around regulatory uncertainty.

Nwakwue, also a former chairman, Nigerian Association of Petroleum Explorationists (NAPE), said, “I expect a better 2024.

“We have started to see increasing rig counts, enhanced pipeline security and one hopes that the new sheriffs in charge of the sector will settle down to drive the growth of the industry.

“We need to pay attention to upstream gas development. The market is presently under-supplied and that would impact our gas-based industrialisation aspirations.

“We also need to ramp up some green field and brown field redevelopment. I expect that the industry should be able to deliver the budget benchmark volumes at a minimum rate.”

The expert noted that there are many ways one could look at the sectoral performance, contribution to GDP, output level and activity level among others.

He said: “I would say  the 2023 performance is a mixed bag. Output levels have remained low, investments levels were low but picking up lately, sectoral GDP contribution remains low at under  six per cent.

“In analysing this, we must also factor the fact that 2023 was an election year and we saw heightened political and economic uncertainty.

“The 2023 performance is less than cheery in my view.

“Streaming of refineries are behind schedule, PIA implementation has been slow and painful, CNG roll-out has been more about media attention and bargaining chip with labour, etc.

“One bright spot is the subsidy removal even when I feel that it could have been better done,” Nwakwue explained.

Mr Bamidele Adesina, an oil and gas analyst, said that there are factors that will limit this growth, including high inflation and interest rates.

Adesina said that the reversal of economic reforms and potential security issues in the oil-producing Niger Delta region may pose challenges.

“The economy is forecast to grow at a faster pace in 2024 relative to this year’s projected expansion on the back of higher oil output.

“That said, elevated inflation and interest rates will keep a lid on growth. The reversal of economic reforms, and potential insecurity in the oil-producing Niger Delta.

“Focus-economics see GDP expanding 3.2 per cent in 2024 and expanding 3.6 per cent in 2025.”

Adesina noted that the recent weakening of the Naira and the increase in petrol prices led to higher consumer prices in July and August 2023.

He said that the rise in prices had put pressure on private consumption.

“To address the rising cost of living and social unrest, the government announced a temporary minimum wage increase for the next six months in early October 2023.

“Additionally, in an effort to tackle the surging transportation costs, the government revealed plans to introduce buses powered by Compressed Natural Gas (CNG).

“The combination of a weaker Naira and the removal of fuel subsidy will likely result in continued inflation in the upcoming quarters. It pointed out that monetary policy and fuel prices will be critical factors to monitor,” he said.

According to him, consumer prices are expected to increase by an average of 22 per cent  in 2024, which is an increase of 0.9 percentage points  from the previous month.

“In 2025, consumer prices are projected to rise by an average of 14.9 per cent.

“The increased crude oil output, particularly with the Dangote Refinery scaling up production, will contribute to much-needed fuel supplies for Nigeria.

“However, the persisting instability in the Niger Delta region poses a significant downside risk to the overall economic outlook “while it also anticipated an average daily oil production of 1.35 million barrels in 2024,” he added.

Mr Heineken Lokpobiri, the Minister of State for Petroleum Resources (Oil) on Dec. 12, said that the federal government was making efforts to remove all bottlenecks that will limit the country from meeting and surpassing the projection.

Lokpobiri spoke about government’s efforts at a stakeholders’ interactive session on ‘Creating value and enabling investments in Nigeria’s oil and gas sector’, organised by Chevron Nigeria Plc.

The minister reiterated that Nigeria can increase crude oil production to two million bpd, noting that issues hindering this are being discussed.

“As a government, we are willing to sustain that engagement with the stakeholders so that in 2024 and beyond.

“We will ensure that we produce not just 1.7 million barrels per day (bpd) that we need for our budget but ensure that we produce what is needed to meet the local demand,” he said.

He highlighted the sector’s growth trajectory since the current administration took office, revealing that the country’s oil production has moved from about 1 million bpd and steadily increased to 1.4 million bpd.

The minister said his goal is to continue this upward trajectory, adding that the government was committed to creating an enabling environment for stakeholders to thrive.

“As a new government that is business-friendly, with a clear mandate to ramp up production, we are willing to ensure that our fiscal regime is competitive globally.

“My appeal is that this old marriage, let us manage it, sustain it and improve on it. Whatever your concerns may be, let us put them on the table to disagree to agree.”

Lokpobiri reassured stakeholders of the government’s effort to address challenges facing the sector by providing the best playing field for both international oil companies (IOCs) and independents for necessary investment.

Yenagoa, Dec. 25, 2023: The  Bayelsa government, says  it will not  allow a protest planned for Dec. 26 to disrupt oil production at Oil Mining Lease (OML) 29, operated by Aiteo Eastern Exploration.

The Bayelsa government in a statement on Sunday by the Commissioner for Information, Orientation and Strategy, Chief Ayiba Duba warned the masterminds of the planned protest in Nembe Basambiri, that youths and chiefs’ council activities remained suspended in the area.

According to the state government, the security agencies have been alerted of the plot calculated to halt oil production at the OML 29 oil fields and deprive the state of the much needed oil derivation revenue.

The government said it would not want anyone under any guise to breach the prevailing peace in Nembe Basambiri and across Bayelsa.

“The attention of the Bayelsa government has been drawn to a planned  protest on Dec. 26 by some individuals in Nembe Bassambiri in Nembe Local Government Area of the state, who have constituted themselves into youth and chiefs councils.

“The public should note that activities of these individuals are  in violation of the subsisting suspension placed on all youth and chiefs’ councils’ activities in Bassambiri at the wake of a violent crisis traceable to the unwholesome conduct of the youth body and chiefs’ council in the area in August.

“The protest being planned by these individuals against Aiteo Eastern Exploration and Production Company will not only disrupt  activities of the company but also  breach the peace, undermine public order and safety as well as possible  destruction  of oil and gas infrastructure in the state,” it said.

The oil production at OML 29 had remained comatose for two years due to unsustainable levels of oil theft and  vandalism on the 97 kilometre Nembe Creek Trunk Line (NCTL).

Aiteo, the indigenous oil firm that acquired the asset for  2.4 billion dollars,  following divestment by Shell recently discarded the NCTL and resorted to direct export using a Floating Production Storage and Offloading Vessel.

The Bayelsa government explained that the planned protest was not only an affront on the authority of the state but also a sabotage of the Nigerian economy.

“Therefore, government wishes to warn those involved in this  attempt to undermine the public peace in Nembe under the guise of protest against oil companies, to abort it immediately as there will be consequence for any unruly conduct.

“Meanwhile, all security agencies in the state have been put on  red alert and will not hesitate to do everything within their means to prevent infraction in Nembe and indeed the entire state.

“To be forewarned is to be forearmed,” it added.

The management of the oil firm has yet to respond to request for response on the development.

Abuja, Dec. 22, 2023: The National Economic Council (NEC) on Thursday constituted committees on Economic Affairs and Crude Oil Theft and Management.

Mr Stanley Nkwocha, the spokesperson of the Vice-President, made this known in a statement on Thursday in Abuja.

The committee was constituted following deliberations on critical economic matters and assessments of potential short-term, medium and long-term strategies for addressing pressing economic issues.

Vice-President Kashim Shettima chaired the 138th meeting of NEC held virtually.

Shettima urged members of the NEC to shelve the idea of vacation in the yuletide and carry on with issues of governance to ease the burden of Nigerians hanging on their shoulders.

He also enjoined the council members to be alive to the demands of Nigerians noting that, “as the year draws to a close, none of us in this chamber should anticipate a vacation.

“I tend to think so because upon our shoulders rests the weight of responsibilities from which we cannot escape. We are returning to be judged by the promises we made to be here.

” My principal, President Bola Tinubu, GCFR, has shown that the challenges inherited by his administration are surmountable.

“President Tinubu has offered visionary leadership and presented a coherent development plan to assist in the country’s pursuit of order, abundance, and stability.

“Each of us owes their constituents the scorecard of their stewardship in these few months of translating ideas into tangible actions.

“That’s why we can’t afford to fail, and the new year must be, for us, a timeout to reflect on how we have fared so far and what we must do differently to keep the hope of the nation alive.”

Apparently keen about getting results of the government’s ongoing reforms in good time, Shettima stressed the need for the citizens to feel the positive impact of fuel subsidy removal and forex unification.

He noted that high inflation and cost of living are global challenges that have affected the economies of all countries.

Shettima said they should be considered as enough “inspiration for us to come together and tackle ours through realistic interventions”.

The committees are to be headed by Gov. AbdulRahman AbdulRazak of Kwara and his Imo State counterpart, Sen. Hope Uzodimma, respectively.

The economic matters committee is saddled with the task of preparing a clear roadmap for dealing with petroleum subsidy, including a framework for defending wage negotiations, exchange rate management and fiscal consolidation sustainability.

It also includes liquidity management and inflation, medium term investment and growth, fiscal transparency and accountability, as well as state of emergency on food production for 2024.

Members of the committee include governors of Gombe; Lagos, Akwa Ibom, Niger and Kaduna States representing North-East, South-West, South-South, South-East, North-Central and North West.

While Rukaiya El-Rufai, Special Adviser to the President on NEC and Climate Change would served as Secretary.

The second committee on Crude Oil Theft and Management, an existing NEC committee, has been reconstituted with Gov. Hope Uzodimma of Imo State as the chairman.

Members of the committee include governors of Ogun, Plateau, Rivers, Borno, Jigawa and Abia presenting South-West, North-Central South-South, North-East, North-West and South-East.

Others are: Minister of Budget and Economic Planning; Minister of Finance and Coordinating Minister of the Economy, CBN Governor; GCEO of NNPCL, NDDC Chairman, and Service Chiefs.

The secretariat would be domiciled at the Ministry of Budget and Economic Planning and the Special Adviser to the President on Economic Matters, Dr Tope Fasua would serve on the committee.

Abuja, Dec. 12, 2023: The Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, says the administration of President Bola Tinubu will account for revenue from oil.

Edun said this when he appeared before the House of Representatives Committee on Appropriation to defend the 2024 appropriation bill on Monday.

He said the issue of accounting for oil revenue is germane, “and clearly whatever we have met as a way of monitoring oil revenue and payment into the federation account will be done.”

The minister said he was in agreement with many who had pointed out the fact that the federal government must have a robust system of paying into government coffers with exchange rates.

He said the current administration plan was to increase revenue from taxation, adding that there was a need to increase the efficiency of tax administration collection.

Edun said the government depends on foreign direct investment, including domestic and the private sector, to grow the economy.

He said the government was not spending enough on key infrastructure, adding that there was a need to interrogate why there seemed to be an overestimation of certain expenditures.

The minister said the plethora of share waste in the number of taxes was being compressed, adding that 90 per cent of tax revenue from the government comes from a particular tax end.

According to him, all the rest that goes out in the name of taxes and levies does not go into the government coffer.

Edun said there was a comprehensive revamping of tax administration, which was done through the instrumentality of the tax reform committee.

This, according to him, has a lot to operate with and will be suggesting ways to go about the tax system.

Rep. Abubakar Bitchi, the Chairman, Appropriation, said there was a need to look at the 2024 budget proposal in order to support the president’s renewed hope agenda.

He said money was needed to achieve this through more funding, saying all the revenue-generating agencies were summoned to ensure Nigeria got the money.

We need to find a way out to achieve the objective of the president’s renewed hope budget. Nigerians are happy that we are reducing borrowing.

Yenagoa, Nov. 26, 2023: About 3,000 barrels of crude oil were lost to the Nov. 15 oil spill from the offshore Egina Floating Production Storage and Offloading (FPSO) vessel of TotalEnergies.

The FPSO located 130 kilometres off the Atlantic coastline from Port Harcourt has capacity to produce 200,000 barrels of crude daily and can store 2.3 million barrels on board.

Director-General of the National Oil Spills Detection and Response Agency (NOSDRA), Mr Idris Musa, said on Sunday that the clean-up of the spill was still on-going.

He added that NOSDRA and TotalEnergies did not spare any effort in tackling the pollution to minimise its impact on the environment, a development that kept the spilled crude from reaching the coastline.

“The spill has not hit the coastline because of the effectiveness of the spills contingency plan we deployed,’’ he said.

Musa explained that NOSDRA deployed high-level personnel and activated the National Oil Spills Contingency Plan to contain the spill.

“The spill was not a minor one; it was the response strategy put in place that resulted to limited impact and we have been tracing and tracking the oil slick and supervising response efforts.

“NOSDRA deployed personnel led by a director to the site and we have remained on the spill site as well as granting the requisite approvals to hasten the response,’’ he said.

Musa explained that the TotalEnergies took steps that made the response swift and effective, adding that other oil companies assisted in the response.

He stressed that spills clean-up required collaborative response of oil industry stakeholders, which, in this case, deployed aircraft, and at least five vessels in the application of 15,000 litres of liquids to clean the waters.