The Nigerian National Petroleum Corporation lost N30.81bn in April 2020, representing over 200 per cent increase in its operating deficit, the corporation’s financial and operational activities reveal.

The corporation in the April report made available on Wednesday indicated that the group recorded a deficit of over 200 per cent monthly loss.

It said, “The report in April 2020 indicates an increased trading deficit of N30.81bn compared to the N9.53bn deficit posted in March 2020.

“The current hike of over 200 per cent is attributed to the 29 per cent increased deficit for NPDC due to ongoing coronavirus-related impact of reduced exports, coupled with the upsurge in corporate headquarters deficit arising from terminal benefits made to retired staff.”

It added, “In addition, PPMC, NGMC and Duke Oil Incorporated posted reduced surpluses arising from the COVID-19 effect of reduced demand, fluctuating prices and marketers’ unwillingness to lift products thus affecting revenue.”

The oil firm stated that the net result was an increased deficit to the group.

It, however, noted that to ensure continuous increased PMS supply and effective distribution across the country, a total of 0.94 billion litres of PMS translating to 31.37 million litres per day were supplied in the month of April in the downstream sector.

Similarly, the NNPC had in June reported that it recorded an operational loss of N9.53bn in March 2020. The March 2020 operational loss ushered the corporation into a new era of revenue loss.

Nigerian National Petroleum Corporation in March declared that it experience over 300 per cent decline in March earnings as a result of the huge decrease of 181 per cent in the Nigerian Petroleum Development Company’s revenue.

NNPC disclosed that it made a total crude oil and gas export sale of $256.19m in March 2020, which decreased by 30.89 per cent, compared to the previous month’s figure.

The operational loss in March reversed the steady growth trajectory of the corporation’s revenue since the last quarter of 2019.

Peace Obi

The Nigerian National Petroleum Corporation (NNPC) has advised against a swift relocation of tank farms from their current locations along Ijegun, Kirikiri areas in Lagos and other parts of the country, stating that it is to avoid a dislocation in the supply and distribution chain of petroleum products across the country.

The Corporation made the submission Wednesday at a hearing by the House of Representatives’ Ad-hoc Committee on Relocation of Tank Farms in Residential Areas of Ijegun, Kirikiri.

In a statement the NNPC Group General Manager, Group Public Affairs Division, quoted the Managing Director of the corporation, Mallam Mele Kyari, as saying that NNPC was not averse to the relocation of the petroleum products tank farms and depots sited in residential areas but would rather that some time be allowed to achieve the full rehabilitation of the refineries and the completion of the Dangote Refinery to enable the nation exit fuel importation before their relocation.

The GMD, who was represented by the corporation’s Chief Financial Officer, Mr. Umar Ajiya, told the committee that the tank farms and depots were a major artery for receiving and distributing imported petroleum products to all parts of the country and that their abrupt relocation would could trigger a crisis not only in the Downstream Sector but also in the nation’s economy in general.

“We are not opposed to the yearnings of the communities or the relocation of the tank farms and depots, but we want it to be done in phases because of the huge financial commitments by the stakeholders. If they are relocated abruptly, even the banking sector would be affected because of the loans they granted for the establishment of the depots,” the GMD stated.

Speaking earlier while inaugurating the Committee, the Speaker of the House of Representatives, Hon. Femi Gbajiabiamila, said the Ad-hoc Committee was set up to investigate the concerns expressed by the residents in order to have a fair assessment of the situation.

Peace Obi

A report has said that there was no slow-down in crude oil production on the facilities operated by over 20 Nigerian based oil companies in April 2020, even as fall in demand remained the status quo and crude oil cargoes were chasing buyers.

The report by Africa Oil + Gas Report yesterday said Seplat produced over 60,000Barrels of oil per day (operated) on the last two days of that month, in its western Niger Delta assets a figure it hadn’t reached for several months before then.

It also stated that NPDC’s JV with Shoreline Natural Resources and Neconde, the two other high volume, indigenous producers in the region, averaged gross output of about 40,000BOPD each. NPDC/Elcrest and NPDC/First Hydrocarbon grossed 26,000BOPD and 11,000BOPD respectively in the month.

“We had to keep producing”, the Africa Oil + Gas Report quoted a chief executive officer of one of the companies, “even as the commodity was selling $9 or less per barrel.”

For the NPDC/ Shoreline JV, which normally averages over 60,000BPD, the lower figure was due outages caused by “forceful shutdown by host community interference in Olomoro, Oweh, Uzere and Oroni flowstations”, the field notes show.

The report further stated some of the companies had hedged against fluctuations in oil, but these times are unusual: prices had crashed down to earth. Even so, “Crude oil produced today may not be sold until June, when prices may have moved up”, another CEO says, in justifying why production was continuing in frenzy.

Chibisi Ohakah, Abuja

The Nigerian National Petroleum Corporation (NNPC) has denied reports credited to labour unions that the corporation had sacked 850 workers at its four moribund refineries.

Last week, labour unions under the auspices of Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) and the Petroleum and Natural Gas Senior Staff Association (PENGASSAN) alleged that the NNPC had sacked 850 contract workers at the nation’s refineries.

NNPC spokesman, Dr Kennie Obateru, in a statement on Monday said the allegations were false. “I am sure they were referring to the termination of contracts between NNPC and some of its contractors at the refineries over two months ago. Because the contractors have no more contracts with NNPC, it affected their workers. So they were not NNPC workers and we did not sack our workers,” he said.

In a joint statement on Monday, the National President, the Nigeria Union Of Petroleum And Natural Gas Workers (NUPENG), Comrade Williams Akporeha, and his counterpart in the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), Comrade Ndukaku Ohaeri, as well as their general secretaries, the NNPC was accused of a secret plan to sack the refinery workers.

“On the purported threat of the Group Managing Director of NNPC to sack workers, we wish to state here that it was actually no more a threat but that it had already been carried out with the sack of 850 support staff in the midst of COVID-19 pandemic, throwing almost a thousand workers into hard financial situation without an iota of empathy or consultation with the union,” it said.

The unions said they never threatened to go on strike, but that they only demanded to be engaged for a proper discussion on the commensurate terminal benefits of the workers, who had worked for 10 to 15 years.

“We found it rather highly inhuman and unfair on the part of NNPC management to sack these workers with only their last pay cheques after 15 good years of their lives in NNPC. If a Minister of Federal Republic of Nigeria and the Group Managing Director of NNPC can dismiss contract workers that have served for more than 10 years continuously as if they are rodents, what more can we expect from lOCs. The monthly salaries of 25 of these contract staff put together cannot equal a typical management staff salary of the same organisation” they queried in the statement.

NNPC recently concluded its recruitment exercise where over 1000 fresh graduates were employed.

Chibisi Ohakah, Abuja

The Organisation of Petroleum Producing Countries (OPEC) is expected to meet today to review the state of the global market amid expectations it will soon begin unwinding the output curbs that have helped haul oil back from its plunge in April.

Ahead, World Oil reported that oil edged lower ahead of the meeting where the group may decide on plans to start tapering historic production cuts even as the Corona virus surges unabated in many parts of the world.

Futures in New York fell below $40 a barrel. Russia’s top oil companies are said to be preparing to increase output next month in the absence of other guidance from the Energy Ministry, according to two people from the industry who spoke to the medium on condition of anonymity.

The increase in supply would come as the U.S. struggles to control the coronavirus outbreak, clouding the demand outlook. More than 50,000 new cases were reported over the weekend. “It seems like OPEC+ will stick with the plan of a bit more production in August,” said Bjarne Schieldrop, chief commodities analyst at SEB AB.

“With record high inventories it is understandable that the market is not all that positive about an additional 2 million barrels a day or so of supply,” he said.

World Oil reported further that West Texas Intermediate for August delivery fell 1.9% to $39.79 a barrel as of 10:23 a.m. in London Brent for September settlement dropped 1.6% to $42.55.

Meanwhile, the Joint Ministerial Monitoring Committee, the panel that reviews OPEC+’s progress, will consider whether the alliance should keep 9.6 million barrels of daily output off the market for another month, or taper the cutback to 7.7 million barrels as originally planned.

Members are leaning toward the latter option, according to several national delegates who asked not to be identified. Saudi Arabia, meanwhile, gave at least five Asian customers less August-loading crude than they had sought, said people with knowledge of the companies’ procurement.

Six other Asian buyers received full allocations, while at least two Indian customers that sought fewer supplies than contracted got roughly what they asked for.

“The speed of recovery of oil prices will be a function of how fast the global pandemic situation can be under control and how long OPEC+ will sustain production cuts,” Bank of China International analysts including Xiao Fu wrote in a note to clients.

Chibisi Ohakah, Abuja

Leading oil and gas professionals Hamish Wilson, Bill Senior, Tony Smith, Martin Dru and Sarah Milne on Tuesday launched an energy transition advisory company, BluEnergy.

The newly launched advisory company is committed to enabling oil and gas companies to leverage their existing asset base to create low carbon energy streams, generating value whilst reducing carbon intensity.

Hamish Wilson, Co-Founder of BluEnergy, says “Our focus is to identify low carbon investment opportunities where companies already have a competitive advantage through in-country relationships and capital project capability. These can bring commercial advantage when deploying the following established low carbon technologies through early entry in emerging markets such as Solar and Wind”.

The company in a statement noted that the challenge facing oil and gas companies has been thrown into sharp relief by the recent COVID-19 crisis, with companies fighting for survival, seeing cash flow, investor returns, supply chain, and the fundamental value proposition under threat with a highly volatile earnings stream and borrowing base. 

Adding that in contrast, companies with high proportions of renewable energy in their portfolios not only suffered less during the crash, but have quickly returned to pre Covid-19 levels. 

The Founders of BluEnergy, along with many other experienced industry professionals, feel that companies that do not embrace the opportunities presented by the Energy Transition and grow broader asset portfolios, may not survive long term. 

They do, however, believe that oil and gas companies are ideally placed to lead the transition, and that it’s time to move on from simply discussing the Energy Transition to actively design and implement strategies that protect and sustain both industry and the wider world. 

“We are passionate about the Energy Transition and we know that oil & gas com

Senior Industry Figures Launch Energy Transition Advisory Company

Leading oil and gas professionals Hamish Wilson, Bill Senior, Tony Smith, Martin Dru and Sarah Milne are today launched BluEnergy.

The newly launched advisory company is committed to enabling oil and gas companies to leverage their existing asset base to create low carbon energy streams, generating value whilst reducing carbon intensity.

Hamish Wilson, Co-Founder of BluEnergy, says “Our focus is to identify low carbon investment opportunities where companies already have a competitive advantage through in-country relationships and capital project capability. These can bring commercial advantage when deploying the following established low carbon technologies through early entry in emerging markets such as Solar and Wind”.

The company in a statement noted that the challenge facing oil and gas companies has been thrown into sharp relief by the recent COVID-19 crisis, with companies fighting for survival, seeing cash flow, investor returns, supply chain, and the fundamental value proposition under threat with a highly volatile earnings stream and borrowing base. 

Adding that in contrast, companies with high proportions of renewable energy in their portfolios not only suffered less during the crash, but have quickly returned to pre Covid-19 levels. 

The Founders of BluEnergy, along with many other experienced industry professionals, feel that companies that do not embrace the opportunities presented by the Energy Transition and grow broader asset portfolios, may not survive long term. 

They do, however, believe that oil and gas companies are ideally placed to lead the transition, and that it’s time to move on from simply discussing the Energy Transition to actively design and implement strategies that protect and sustain both industry and the wider world. 

“We are passionate about the Energy Transition and we know that oil & gas companies have the global reach, scale and skills to lead the Energy Transition” says Tony Smith, Co-Founder. 

“We recognise the cultural challenges in embracing this strategic move that starts the journey to the long-term transformation of the energy sector. 

“BluEnergy is focused on delivering tangible low-carbon projects, and we believe we are well-positioned to support the oil and gas industry in moving towards a lower carbon intensity future and a more resilient share price,” Smith said.

Peace Obi 

panies have the global reach, scale and skills to lead the Energy Transition” says Tony Smith, Co-Founder. 

“We recognise the cultural challenges in embracing this strategic move that starts the journey to the long-term transformation of the energy sector. 

“BluEnergy is focused on delivering tangible low-carbon projects, and we believe we are well-positioned to support the oil and gas industry in moving towards a lower carbon intensity future and a more resilient share price,” Smith said.

Peace Obi 

There is unease in the global oil circuit as OPEC Joint Ministerial Monitoring Committee (JMMC) warm up for a talk, today and tomorrow where lower levels for future output cuts might be proposed. Reuters reported yesterday that oil prices lowered, extending Friday’s losses as coronavirus infections touched an all-time daily high.

The situation is said to be critical in the US, with huge swells in infections during the weekend. Analysts thought the Organisation of Petroleum Exporting Countries (OPEC) would experience a price war.

Brent Crude edged lower by 43 cents or 1.2% to $42.81 per barrel by 12.57 mid-day although prices had been staying around $42 for some weeks, Reuters reported U.S. benchmark crude, West Texas Intermediate, slid 42 cents or 1.04% to $40.13 a barrel, the report said.

Bonny Light, Nigeria’s premium oil grade, bucked the market downtrend at the last session on Friday to climb 60 cents or 1.41% to $43.28. Another national offering, Qua Iboe added $1.13 or 2.69% to reach $43.10 on Monday.

The news agency quoted Stephen Brennock, analyst at oil broker PVM saying, “pricing pressures are locked in a holding pattern and will remain so until the coronavirus pandemic is brought under control. Until then, there will continue to be a lack of conviction in upside potential.”

World Health Organisation had announced last Sunday an unprecedented daily surge in the pandemic’s cases, coming to over 230,000. Infections in the U.S. ballooned in the weekend that just went by amidst news of an uptick in Florida’s cases, which topped 15,000 in 24 hours, a record for any American state.

“It has been all but a bumpy ride for oil during the last months and the OPEC+ deal on supply has been a pillar for the market. The upcoming OPEC+ meeting this week is now expected, as planned, to make this pillar a bit weaker,” Louise Dickson of Rystad Energy said.

OPEC and its Russia-led allies, collectively known by the tag: “OPEC+” are envisaged to slash supply cuts to 7.7 million barrels per day (bpd) following a rally in global oil demand even though there are signals that the market is still battling glut trouble.

OPEC+ slashed production by an unprecedented 9.7 million bpd for May June and July following an oil crash in April that saw U.S. crude touch its historic low. Libya, however, replaced a bar on every oil exports on Sunday on the ground of renewed blockade by eastern forces two days after it exported its first crude cargo in six months, Reuters said.

Chibisi Ohakah, Abuja

Nigerian National Petroleum Corporation (NNPC) has revealed that the controversial petrol subsidy took over N101 billion from the country’s coffers in the first three months of 2020.

CBN Monthly Financial and Operations for March 2020, released on Monday, described the subsidy spending as under-recovery. The report showed that the corporation spent N43.31 billion as subsidy on petrol in 2020. The figure came down substantially in February, to about N20.68 billion, while in March the national oil company spent N37.66 billion as subsidy.

However, the Petroleum Products Pricing Regulatory Agency (PPPRA) heeded to a long standing public outcry and withdrew fuel subsidy in March 2020.  Analysts said it was remotely caused by crash in global oil prices which distorted the economic estimates worldwide.

The PPPRA said among others that it would concentrate on regulation and allow mostly market forces to dictate prices of products.  The agency is recorded as having adjusted product prices about three times since March this year.

The CBN Monthly Financial and Operations for March 2020 further stated that the corporation paid N434.25 billion to the Federation Account Allocation Committee during the quarter under review. It also indicated that a total of N138.57 billion was remitted to FAAC in January, while the committee received N148.53billion from the corporation in February 2020.

The NNPC said it paid N147.15 billion to FAAC in March this year. Reacting to the amount spent as petrol subsidy in the first quarter of 2020, the former President, Association of National Accountants of Nigeria, Dr Sam Nzekwe, said the government should insist that subsidy remained halted.

He said, “There is no need for subsidy again because they are using it to make unnecessary demands and this is the corruption that we are talking about. They are also using it to finance corruption too. The money that they would have used for other sectors or even send to FAAC is being used for subsidy and we cannot actually quantify its impact on the masses; rather, it is used to enrich a very few.”

Continuing, he said, “The NNPC should not be the only one importing petrol. The downstream sector must not continue like this. Other players should be allowed to play in the space too. The sector should be fully liberalised. And it is because the NNPC is the only one importing and almost running everything. This should not continue.”

The National President, Petroleum Products Retail Outlets Owners Association of Nigeria (PRTROA) Dr Billy Gillis-Harry, said he supports the removal of subsidy, but called on the federal government to come to the rescue of petroleum product, retail outlet owners as they were mostly affected during the price changes.

He also argued that the PPPRA should not be left alone in the determination of petrol prices. Harry called for stakeholders’ conference where such prices can be determined before implementation.

“I totally support removal of subsidy. Indeed out members do support the removal too. But we want the leaders of PPPRA, DPR, Ministry of Petroleum Resources NNPC to meet with the leaders of the various petroleum marketers, including PETROAN, to deal with the issue of pricing,” Billy, who is the chief executive officer of Bilview Energy, stated

Chibisi Ohakah, Abuja

Hearing continues today, and a judge’s ruling will determine whether the Nigeria’s government can continue its appeal and present its full case of alleged fraud in the $10 billion, P&ID judgment against Nigeria in UK in 2017.

The battle to overturn the arbitration award against Nigeria peaked yesterday as the federal government said it has uncovered previously unknown payments to the daughter of a Nigerian official. Reuters said the Nigerian lawyers told the court on Monday that fresh evidence showed that a case of bribe taking had been established.

It will be recalled that Process & Industrial Developments (P&ID), a firm set up to carry out a gas project in Nigeria, won a $6.6 billion arbitration award after the 2010 deal collapsed. It was also reported that the court award has been accruing interest since 2013 and is now worth nearly $10 billion, and have lingered largely because could not attend to the litigation.

Since 2019, when the news broke, Nigeria has been battling legally to upturn the judgement.   It seeks permission in the English courts to appeal the award, despite having missed the 28-day appeal deadline. Nigeria’s current claim is that there were certain payments from companies related to P&ID to one Vera Taiga, eleven days before the deal was signed. The young lady’s mother, Mrs. Grace Taiga, was the chief lawyer for the Petroleum Ministry at the time when this deal was sealed in 2017.

“The government said one payment of $4,969.50 was made on Dec. 30 2009, and a second of $5,000 on Jan. 31 2012. The payments came to light following a U.S. discovery order in New York, it said. The government also said P&ID officials, and companies linked to it, paid several other officials in relation to the deal,” the news agency reported yesterday.

In Nigeria, Mrs Taiga was charged for anti-graft in 2019 by the Economic and Financial Crimes Commission (EFCC), but the former ministry official who is on bail denied any wrong doing.
P&ID has said Nigeria is engaged in a “manufactured fraud investigation” that has denied its subjects due process. In a skeleton legal argument, its lawyers said the payments were legitimate and for medical expenses.

Chibisi Ohakah, Abuja

Airborne Oil & Gas on Tuesday announced that ExxonMobil Upstream Integrated Solutions Company (ExxonMobil) has qualified its thermoplastic composite pipe (TCP) product for applications globally.  

Airborne Oil & Gas in a statement made available to Orient Energy Review said the milestone was achieved following a stringent and detailed assessment of the company’s qualification test data and track record to date. Adding that the supermajor accepted the TCP jumper product for water injection purposes on its affiliates’ projects worldwide. 

 Krassimir Doynov Ph.D, the Senior Technical Advisor flexibles, umbilicals and risers, said: “In ExxonMobil Upstream Integrated Solutions Company, we see potential for the use of TCP as an intrinsically non-corroding and spoolable lightweight pipe that can be used in a range of static and dynamic deepwater applications.  

 “Airborne Oil & Gas has satisfied our criteria for the qualification and design of TCP manufactured from glass fibers and PolyEthylene, which enables our upstream affiliates’ to consider this technology as a potential alternative to existing solutions for projects that use water injection jumpers made of  rigid steel pipe and unbonded flexible pipe.” 

Also, the Chief Technology Officer with Airborne Oil & Gas, Henk de Boer Ph.D, commented: “With our TCP products based on glass fibre and PolyEthylene fully qualified by DNVGL as well as many major operators around the globe, we have built a basis of track record on flowlines and jumpers in water injection, methanol injection, gas lift and hydrocarbon production applications.  

 “Following years of qualification testing, our first product based on carbon fibre and PA12 (nylon) is also qualified, and we are progressing fast with the next material, carbon fibre and PVDF. Through our continued qualification efforts and step-by-step approach, Airborne Oil & Gas will always offer the optimal material solution for each application. We are proud to add ExxonMobil to a long list of operators who have qualified our TCP products.” 

 Airborne Oil & Gas has the largest track record globally for TCP. The company offers a wide range of TCP products based on a variety of fibre and polymer materials, to provide the best solution depending on the needs, pressure, service and temperature. 

Peace Obi

The Federal Government has approved the reconstitution of Federal Government’s representatives on the boards of the Nigeria (Liquefied Natural Gas) and the Bonny Gas Transport Limited (BGT).

The Minister of State for Petroleum Resources, Chief Timipre Sylva disclosed this in a statement on Monday.

Sylva explained that the reconstitution of the boards became imperative since the present boards members were inaugurated in 2005.

The Minister disclosed the new members for the NLNG include Dr Edmund Daukoru as Chaiman, Mr Henry lkem-Obih as a Member and Dr Rabiu Sulaiman as a Member.

Other Members include the Group Managing Director of the Nigerian National Corporation (NNPC), Malam Mele Kyari and the Permanent Secretary, Ministry of Petroleum Resources, Mr Bitrus Nabasu.

Sylva further stated that Daukoru was also approved as the President of the Board of BGT while Doyin Akinyanju and Abdul Abba are members.

The minister noted that Kyari and Nabasu were also members of the board.

“I will like to use this opportunity to thank the chairman and other outgoing board members of NLNG for steering the companies to record successes, particularly the Train 7 FID.

 “l wish the exiting members good health and more successes in their future endeavors.

“To the incoming members of the board, I congratulate you on this appointment; your selection is based on your experience, integrity and expertise.

“I, therefore, urge you to bring all these to bear in the discharge of your responsibilities in line with the progressive agenda of Mr President,” he said.

Orient Energy Review observes that some of the members of the newly reconstituted had worked in the industry in the past.

Daukoru was a former Minister of State for Energy and also Secretary General of the Organisation of the Petroleum Exporting Countries in 2006.

Daukoru went further to become the Amayanabo – the traditional ruler of Nembe Kingdom, Bayelsa State in 2008.

On the other hand, Ikem-Obih was a former Chief Operating Officer, Downstream of the NNPC and Rabiu a former Group Executive Director at the corporation.

Peace Obi

Halliburton and TechnipFMC have announced the introduction of Odassea, the first distributed acoustic sensing solution for subsea wells. Odasea technology platform enables operators to execute intervention-less seismic imaging and reservoir diagnostics to reduce total cost of ownership while improving reservoir knowledge.

The technology integrates hardware and digital systems to strengthen digital capabilities in subsea reservoir monitoring and production optimization. A report by Petroleum Africa last Friday said Halliburton provides the fiber optic sensing technology, completions and analysis for reservoir diagnostics.

TechnipFMC provides the optical connectivity from the topside to the completions. Through the collaboration, operators can accelerate full field subsea fiber optic sensing, design and execution, the medium stated.

“We are excited to introduce a new technology platform which allows our customers to monitor reservoir performance in real-time” the medium quoted Trey Clark, Vice President of Halliburton Wireline and Perforating.

“By collaborating with TechnipFMC, we can harness our combined subsurface and subsea expertise to deliver differentiated products to the marketplace that provide value for our customers.”

The report also quoted Christina Johansen, Vice President of TechnipFMC Subsea Product Management Control & Automation, “This project enables an enhanced level of reservoir understanding for our customers and expands our unique integrated subsea solution. We are proving that we can leverage the competencies and know-how to drive the change our industry needs for a higher level of sustainability.”

Petroleum Africa said Halliburton and TechnipFMC are delivering solutions with the technology to multiple subsea projects at all stages from conceptual design to execution and installation.

Chibisi Ohakah, Abuja