The International Oil Companies (IOCs) operating in Nigeria’s oil and gas industry yesterday revealed that investors’confidence and appetite in the nation’s oil and gas industry has received a boost in recent times due to the Nigerian National Petroleum Corporation (NNPC) commitments to the settlement of joint venture (JV) cash call arrears owed them.
The NNPC had in December 2016 reached an agreement with the IOCs on the payment of the outstanding $6.8 billion cash call debt to its JV partners, where it secured a discount of $1.7 billion and was asked to pay $5.1 billion over a period of five years.
The IOCs include: Mobil Producing Nigeria Unlimited (MPN); Shell Petroleum Development Company (SPDC); Total Upstream Companies in Nigeria (TEPN); and Chevron Nigeria Limited (CNL) among others.
The country chair of Shell Companies in Nigeria, Mr. Osagie Okunbor, commending the development, described it as a pragmatic move that has helped to restore investors’ confidence in the country. The Shell boss gave the commendation yesterday at the ongoing 2018 Nigeria Oil & Gas Conference and Exhibition holding in Abuja.
Speaking at an industry leaders panel session on the theme: “Unlocking Nigeria’s Investment Potentials”, Mr. Okunbor cited the successful exit of cash call and the clearance of the outstanding arrears by the NNPC as the strong points of the initiative. Meanwhile, the NNPC has failed to give the actual volume of premium motor spirit (PMS) popularly called petrol consumed in the country stressing that the federal government has recently put machinery in motion to determine the actual volume of the commodity purchased by Nigerians on a daily basis.
The Corporation’s chief operating officer, (COO) Downstream, Mr. Henry Obih, disclosed while speaking on a panel discussion with the theme: “Harnessing the Opportunities in Nigeria’s Downstream Sector,” at Conference.
This even as the Corporation’s claims that it supplied 2.49 billion litres of petrol in March 2018 translating to 80.2 million litres per day to sustain seamless distribution of Petroleum Products and zero fuel queue across the nation. The figures, contained in the NNPC Monthly Financial and Operations report for March 2018 released later yesterday said the Corporation was keeping an eagle eye on the daily petrol evacuation figures from depots across the nation, with, where necessary, the support of the Nigerian Customs Service (NCS) through existing Joint Monitoring Team.
But Mr. Obih, while speaking at the panel, stated that NNPC has been mandate by the National Executive Council (NEC) to work with relevant agencies to determine actual consumption of petrol in the country.
Fuel consumption has in recent times become controversial in recent times as NNPC puts the figure at 65 million per day, blaming the sharp rise from about 35 million barrels per day, on rising cases of smuggling of the commodity. The Corporation recently released a report showing evidence in the proliferation of petrol stations along the country’s borders use for smuggling.
On his part, NNPC’s chief executive officer, Downstream, Mr. Anibor Kragha, who was also on the panel stated that the country’s refineries are currently producing, though in little quantity, noting that the ex-depot price for products from the refineries stood at N103 per litre. This is even as Obih, further stated that the NNPC was partnering with the World Bank to progress in a study on Nigeria’s actual consumption.
Responding to questions on Nigeria’s current daily fuel consumption figure noted that the country’s daily fuel consumption is presently not known because of a number of factors, ranging from smuggling and the various consumption pattern of the commodity among Nigerians. “We are presently in a joint project with the Federal Ministry of Finance. We are doing a study around consumption, to determine the actual consumption by the people. We have to determine what we call the daily load out or the evacuation, as against the actual consumption; what people go to the pump everyday to buy for their cars, for their generators at home and for other uses of PMS.”
Expatiating, he stated that in terms of daily truck out from depots around the country and in terms of the records of the Petroleum Product Pricing Regulatory Agency and the Department of Petroleum Resources, DPR, the NNPC trucked out 48 million litres daily in 2016 and 50 million litres in 2017. “This is why the National Economic Council has mandated that we work with the Federal Ministry of Finance. We also have meeting with the World Bank about six weeks ago, and we are trying to progress in a global study that would help us get around the actual numbers of what we consume in Nigeria, he said.
“But again, one significant challenge is the fact that we have cross-border smuggling. Nigeria remains the cheapest source of PMS in the West African sub-region. All our neighbouring countries are selling at over 200 per cent high of the price that we pay at the pump. If you go to Niger, Cameroun, then it is in the 400 per cent region; for the rest of the countries, it is about N360 to N370, as against the N145 per litre that we sell. That is sufficient incentives for those who want to take the product across the border to sell and make a good margin.
“What that means if we do a complete study today, that is focused on actually tracking the sub-groups that Nigeria buy fuel from, we would still have a margin of error that is significant. This is because the volume that leaves Nigeria through the borders cannot be reported in accuracy today”.
“However, the NNPC is working closely with the Customs, with the DSS, with other security agencies and things have improved significantly.” Meanwhile NNPC in the said report announced that gas supply to power generation, hit 854.40million Standard Cubic Feet of gas per day (mmscfd) for March 2018, translating to an equivalent power generation of 3,492MW.
A statement issued by the Corporation spokesman Ndu Ughamadu said the details of the March 2018 National Gas Production figures is contained in the Monthly NNPC Financial and Operations Report for the period indicated a total national gas production of 253.06 Billion Cubic Feet (bcf), averaging 8,163.58mmscfd. Period to date Production from Joint Ventures (JVs), Production Sharing Contracts (PSCs) and Nigerian Petroleum Development Company (NPDC) amounted to about 69.82 per cent, 21.95 per cent and 8.23 per cent respectively.
A breakdown of natural gas off-take, commercialization and utilization showed that out of the volume of gas supplied in March 2018, a total of 152.60 bcf of gas was commercialized, comprising 40.52 bcf and 112.08bcf for the domestic and export market respectively. This, the report says, translates to a total supply of 1,307.09mmscfd of gas to the domestic market and 3,615.62mmscfd of gas supplied to the export market for the month. The report said 59.92 per cent of the average daily gas produced was commercialized while the balance of 40.08 per cent was re-injected, used as upstream fuel gas or flared.
“Gas flare rate was 10.55 per cent for the month of March 2018, that is, 867.10mmscfd compared with average Gas flare rate of 10.24 per cent or 804.14mmscfd for the period March 2017 to March 2018”, the report said. The rise in flare rate being a function of spike in gas production during the month. The monthly report stated that about 3,236.82mmscfd or 89.52 per cent of the export gas was sent to Nigerian Liquefied Natural Gas Company (NLNG) Bonny for March 2018 compared with the period (March 2017 to March 2018) average of 3,122.92mmscfd or 90.64 per cent of the export gas.
Aduda Disburses N100m Grant To Abaji, Kwali Residents
Senator representing the Federal Capital Territory (FCT), Philip Aduda, has disbursed N100 million grant to 1,000 residents of Abaji and...
Candido Partners FCTA To End Double Taxation
Chairman of Abuja Municipal Area Council (AMAC), Hon. Abdullahi Adamu Candido, has promised to partner with the Federal Capital Territory...
Nwoko Takes Supreme Court Judgement In Good Faith
Foremost philanthropist Prince Ned Nwoko, has accepted the Supreme Court judgment which struck out his pre-election case challenging the victory...
Assets Declaration: PDP, Atiku Commend Makinde For Fulfilling Electoral Promise
The Peoples Democratic Party (PDP) yesterday hailed the decision of the Governor of Oyo State, Engineer Seyi Makinde for making ...
Edo Tribunal: PDP Presents 19 Witnesses For NASS Petition
The Peoples Democratic Party (PDP) could only call 19 witnesses out of the scheduled 71 witnesses at the end of...
Insecurity: Listen To Obasanjo, CUPP Tells PMB
The Coalition of United Political Parties, CUPP, has hailed former President Olusegun Obasanjo for his patriotic advise contained in an...
Obaseki Has No Plan To leave APC, Says Aide
The Special Adviser to Edo State governor on Political and Community Matters, Chief Osaro Idah, has said that Governor Godwin...
NEWS14 hours ago
Navy Releases List Of Successful Candidates In 2019 Aptitude Test
NEWS12 hours ago
Christine Lagarde Resigns As IMF MD
NEWS14 hours ago
Soyinka Denies Criticising PMB’s Administration
NEWS12 hours ago
Lawmaker Assures Of NASS Support To Make Nigeria Safe
NEWS12 hours ago
Court Remands Man In Prison Custody Over Car Theft In Osun
NEWS13 hours ago
Nigerian Students Get $7.5m In Scholarships From US Universities
NEWS13 hours ago
Cuba Seeks Nigeria’s Support To End U.S Blockade
COVER STORIES5 hours ago
FG, Workers Head For Showdown Over New Minimum Wage