…PETROAN wants FGN loan for members to cushion effect of changes in price 

Nigeria’s Department of Petroleum Resources (DPR) has sealed two petrol stations in the Abuja metropolis for selling the Premium Motor Spirit (PMS) above the regulated price band of N121.50/N123.50 per litre.

The sealing of the petrol stations comes on the heels of calls by the President of Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), Prince Billy Harry, for government to offer soft loans to petrol station owners to enable them contain the repeated changes in pump price of premium motor spirit nationwide nu the federal government in the last two months.

He said although it is not a reason for anyone to sell above pump price. He said the loan will cushion the effect of the sudden change in fuel price which he said did not reckon with the existence of old stock with members of PETROAN.

“Our organisation wholly supports the removal of fuel subsidy, but as a group, we are saying it should have human face. There is no way you can say a few unsuspecting members of Nigeria’s business community to suffer for a government policy that is no fault of theirs,” Harry said.

Meanwhile, DPR said on Sunday that it was gearing up to clamp down on other erring filling stations. DPR Zonal Operations Controller, North-Central, Engr. Abubakar Buba, told newsmen in Abuja that the sealing of the filling stations was sequel to findings by the department’s compliance monitoring team that the owners were selling fuel above the approved pump price.
The DPR boss said that after the compliance monitoring tour of petrol stations in the Federal Capital City, all the 35 stations visited complied with the new fuel price except the sealed two stations which sold at N125 per litre.

According to him, the agency’s constant monitoring of petrol stations has also prevented many of the stations from under dispensing of the products to motorists. He urged fuel marketers to always abide by market rule to avoid government sanction.

While confirming the existence of adulterated diesel in circulation, the DPR zonal controller said the department was working towards tracing the source and apprehending the perpetrators. He said samples of alleged adulterated diesel had already been taken to be tested in the DPR lab to first establish if they are sub-standard, the level of adulteration and then go after the criminals.

Orient Energy Review, gathered that one of the sealed stations, Rahmaniyyah Oil at Kubwa Express way was later unsealed after the station adjusted its meters to N123.5.  It is not clear if the second station, Yinzag Petroils, located on the Mabushi expressway, was sealed later.

Chibisi Ohakah, Abuja
 

Organisation of Petroleum Exporting Countries (OPEC) has said that Nigeria has today (June 22) as ultimatum to submit a schedule of the oil compensation plan, following the failure to fully comply with an April deal aimed at cumulative reduction of production by about 9.7 million barrels daily.
Also affected in the OPEC order are Angola, Gabon and Azerbaijan. The countries also failed to submit a schedule of the oil production cut compensation plan. Iraq and Kazakhstan, who were culprits at some point, are reported to have taken steps to fulfill their obligations to the cartel.
An OPEC statement last week Thursday after the 19th Joint Ministerial Monitoring Committee (JMMC), which was held via videoconference, under the chairmanship of Saudi Arabia’s Minister of Energy, Prince Abdul Aziz Bin Salman, and co-Chair, Mr. Alexander Novak, who is the Minister of Energy of the Russian Federation, noted that sticking with the cuts as promised was not only the fair thing to do, but also an equitable move.
The committee reviewed the monthly report prepared by the Joint Technical Committee (JTC) and recent developments in the global oil market, as well as immediate prospects for the remainder of 2020 and into 2021. It mandated the OPEC secretariat to reach out to countries that are still defaulting to extract a commitment from them that their product cut plan was still active.
“The committee emphasised the critical importance of adhering to full conformity and compensating the overproduced volumes in the months of May and June, during the months of July, August and September 2020, in accordance with the statement of the 11th OPEC and non-OPEC Ministerial Meeting of the DoC (June 6, 2020), in particular with reference to the five elements agreed.
“The committee would like to thank those participants, namely Iraq and Kazakhstan, which have already submitted their compensation schedules, and agreed to give other underperforming participants, which have not yet submitted final plans, until next Monday, June 22, 2020 to submit their schedules for compensation to the OPEC Secretariat,” the statement said
It said the committee mandated the secretariat to reach out to all the underperforming participating countries to submit their schedules for compensation by the above mentioned date.
It stressed that the attainment of 100% conformity from all participating countries was not only fair and equitable, but vital for the ongoing and timely rebalancing efforts and helping deliver sustainable oil market stability.
It reiterated its earlier position to extend the first phase of the production adjustments by a further month, now till July 31, 2020, and subscribing to the concept of compensation by those countries who were unable to reach full conformity (100 per cent) in May and June.
OPEC added: “Thee committee took note of the overall conformity of 87% for the month of May 2020. It also observed individual country conformity levels and reiterated the critical importance that all participating countries achieve their 100 per cent level.
“They will also make up for any monthly shortfalls in the months of July, August and September. It welcomed the expressed commitments from those countries below the 100% May conformity level and specific compensation plans highlighting how this will be accommodated, and delivered, between July and September”

Chibisi Ohakah, Abuja

A report has said that Nigeria, Angola, Equatorial Guinea and Cameron sustained their export of liquefied natural gas (LNG) despite the economic turmoil triggered by the coronavirus pandemic. An analytical data from S&P Global Platts described exports from the listed countries as showing ‘resilience,’ during this period.

The report said that total LNG exports from the four exporting countries in the region, so far this year are broadly in line with volumes supplied in the same time frame last year. That is despite sharp falls in LNG utilization rates in other parts of the world, particularly in the US, while spot-exposed Egypt has halted LNG exports altogether.

Nigeria is exposed to the spot market with around 50% of its LNG exports last year sold on a spot or short-term basis, according to industry group, the International Group of Liquefied Natural Gas Importers (GIIGNL). The report however noted that Nigeria’s LNG exports in 2020 have stayed strong despite weaker demand and low prices, with some 11 Bcm exported in the first five months of the year.

That is down just 4% on the same period last year. S&P Platt said some cargoes have taken longer to reach their destinations, while other loaded cargoes have been idling at sea in recent weeks, but nonetheless, exports continue out of the country’s only LNG plant, the 22 million mt/year Nigeria LNG facility.

“With supply to the Nigeria LNG facility being associated gas, LNG exports are to a degree driven by domestic oil production, which Platts Analytics estimates fell by around 5% over the first five months of the year,” Platts Analytics’ LNG analyst Luke Cottell said.

“This meant we saw little change in LNG exports year on year, although a record volume of Nigerian LNG on the water in late May was indicative of the difficulties such cargoes faced in finding a home amid record low prices in both Asia and Europe,” Cottell said.

In the coming months, Nigeria’s oil output may fall as it moves to fully comply with its OPEC+ production quota. As a result, Cottell said, LNG exports are likely to be curtailed in tandem. Jean-Baptiste Dubreuil, gas analyst at the International Energy Agency, in early June said LNG trading overall remained high despite the pandemic and an expected 4% dip in total global gas demand in 2020.

He said that while pipeline gas exports from North Africa had been hit by the slowdown in demand, LNG exports had been fairly resilient. Further out, Dubreuil said, “LNG will be main engine for the rebound beyond 2020 and 2021.”

Africa’s second biggest LNG exporter Angola has seen its supplies increase so far in 2020, with a total of 2.7 Bcm of gas equivalent exported in the first five months of the year. That is up by almost 4% year on year. The 5.2 million mt/year Angola LNG plant resumed operations in June 2016 having been closed for more than two years due to technical problems.

Meanwhile, LNG exports from Equatorial Guinea totaled 1.5 Bcm in January-May this year, down 11%, due in part to falling production from the facility’s main feedgas field, Alba. Equatorial Guinea hopes that first gas from the Noble Energy-operated Alen field offshore the West African country can be delivered by the end of 2020.

Cameroon became the fourth African LNG exporter in May 2018. It exported 0.7 Bcm of gas equivalent in the first five months of 2020, up from 0.6 Bcm in the same period last year.

Chibisi Ohakah, Abuja 

The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kyari, has said that Nigeria does not know the quantity of oil consumed internally, daily.

He said the NNPC does not have the facility or ability to measure the amount of oil consumed in liters, despite the fact that it has the record of liters produced and distributed from the various depots per day.

At an interactive session with lawmakers on Tuesday, Kyari had put the daily consumption of petrol in Nigeria, based on product evacuation record at the depot, at about 54 million litres.
“We don’t know how much petroleum we consume daily in this country but we know how much of the product that is taken out of our various depots and lifted round, nationwide. This year alone, around 54 million litres of petroleum product are evacuated from the depot daily but the consumption is somewhere below that.

“NNPC has no knowledge of the amount of the product that are transported through Nigeria’s borders to neighbouring countries. We are not in control of the borders, and therefore in no position to say or know what quantity of petroleum products pass out of the country illegally through the borders

“It is impossible to know, nobody declares it, and therefore as it crosses, it goes,” the NNPC boss told the lawmakers

The interactive hearing was on “Exiting Petroleum Subsidy: Ensuring Self – Sufficiency in Domestic Refining of Petroleum Products,” organized by the Joint Senate Committee on Petroleum Resources (Upstream and Downstream).

Chibisi Ohakah, Abuja

The Director of Petroleum Resources, Engr Sarki Auwalu has inaugurated the network code operationalisation teams for the full implementation of the Nigeria Gas Transportation Network Code (NGTNC).

The NGTNC was recently launched by the Honorable Minister of State, Petroleum Resource, Chief Timi Sylva, with a six-month mandate to go live.

 In his address during the virtual inauguration on Wednesday, Auwalu stated that the teams were to provide the needed impetus for the full operationalisation of the network code.

He said also that basic regulatory instruments for the operationalisation of the network code like licence regime and administrative system will be expedited by DPR before the go-live ministerial mandate. According to him, the operational readiness of the gas transmission system as well as migration of extant agreements into the network code by the Nigerian Gas Company (NGC) will be concluded to align with the go-live date.

Engr. Sarki explained that the constitution of the teams of experts was a product of extensive consultation and he was confident that they will perform beyond expectation to help in the accelerated development and maturation of the Nigerian domestic gas sector.
He thanked the leadership and members of the NNPC, GACN, NGA, OPTS and DPR gas team for their commitment towards the successful operationalisation of the network code. The inaugurated teams with their Terms of Reference (TOR) are as follows:
Team 1: NC Operationalisation Technical Working Team (NCO-TWT), Ayuba Steve DPR-Team Lead, Duruji Elvis DPR, Mungadi Ahmad DPR, Aisha Ibrahim DPR-Scribe, Ohwomado Andrew    NGC, Muhammed Isa NGC,   and Olanrewaju Lukman NGC.
Terms of Reference include, To establish System readiness for full operationalisation of NGTNC; Articulate the technical modalities for the successful migration of existing Gas Transport Agreements (GTAs) to network code;     Develop a framework for providing effective stakeholder support for all technical and regulatory issues for effective operationalisation of network code; Develop a framework for effective monitoring of the performance of network code and impact on the domestic gas market segment
Other terms of reference are, To develop a periodic network code reporting template for submission to the network code steering committee; Review domestic gas market impact of NGTNC post full operationalisation of the code
Team 2: NC Operationalisation Commercial/Legal Working team (NCO-CLWT),     Gberindyer Terkula  NGC-Team Lead, Kingston Chikwendu DPR, Ohwodiasa Mabel NGC, Mathias Yetti   NGC, Eremutha Augustine NGC,    Maisule Hadiza DPR, Ali Garba Ali DPR, and Ramatu Abdullahi DPR
Terms of Reference for Team Two include: Articulate the legal modalities and identify/resolve any legal encumbrance for the successful migration of all existing Gas Transportation Agreements (GTA’s) to NC;    Review the tariff methodology and values for all envisaged payments/charges on the code; Analyse and make recommendation on issue of payment in dollar or naira for the network tariffs and charges
Team 3: NC Operationalisation Steering/Governance Committee (NCO-SGC),   Director/CEO, DPR Chairman, MD, NGC Member, Head, Gas DPR Member, and Head, Legal DPR Member. Terms of Reference of reference include: Direct the activities required for full operationalisation of the NGTNC;    Administer governance oversight of the NGTNC technical, Commercial and Legal working committees
The Team is also supposed to interface with Honourable Minister of State Petroleum Resources on NC and provide strategic market update on impact/performance of NC

Chibisi Ohakah, Abuja

A World Bank report says that Nigeria has the opportunity of retrieving yet about $20 billion in revenue if adequate transparency is applied in the oil and gas sector. The World Bank and the Extractive Industries Transparency Initiative (EITI), the global standard for the promotion of openness in the oil, gas and mineral resources management, said in a joint account that Nigeria has so far recovered about $3 billion as a result of transparency.

A report released by the World Bank’s Extractives Global Programmatic Support (EGPS) Multi-Donor Trust Fund and EITI, last week end, said through the work being done by the NEITI, additional revenues bout $20 billion in revenues could still be retrieved.

The World Bank report affirmed that that Nigeria had indeed made satisfactory progress in implementing the EITI standard, adding that Nigeria remains one of the eight countries that achieved this assessment, among the EITI’s 53 member countries.

“Reports, policy briefs and other knowledge products published by the Nigeria Extractive Industries Transparency Initiative (NEITI) have been a catalyst for ongoing reforms and have helped the country to identify about $20 billion in recoverable revenues, and to recover approximately $3 billion into government coffers to date,” the global bodies stated.

The Nigeria’s oil sector regulator, the Department of Petroleum Resources (DPR), has released its strategic plan and policy for the survival and success of the industry post-COVID-19. Acknowledging that the country still faces developmental issues, including the need to reduce economic dependence on oil and rebuild social infrastructure, both organisations, however, the DPR noted that the country has made improvements in the administration of the oil sector.

Having enacted the Nigeria EITI Act in 2007, the World Bank publication noted that though there’s still much work to do, the country has made some progress in terms of reducing the opacity in the extractive industries. “Previously, the industry was opaque, with little reliable public information on production levels, crude oil losses, government investment in the upstream projects or downstream information.

“The EITI in Nigeria encountered some initial hurdles in publishing accurate and timely reports on key sector data, such as production, revenues and governance processes. Some reports were delayed by several years, meaning that those who could hold the state accountable for oil revenues – such as investors, companies, civil society organisations and the media – received data only several years after the reporting period.

“With the help of the World Bank’s Extractives Global Programmatic Support Trust Fund, NEITI has now succeeded in producing its reports in a much more timely and efficient manner,” the report stated.

“A 2017 policy brief on unremitted funds highlighted more than $20 billion, which the national oil company, the Nigerian National Petroleum Corporation (NNPC), should have contributed to government revenues, highlighting the urgent need for oil sector reform.

The brief received widespread attention, generated a national dialogue and caught the attention of decision-makers.

Chibisi Ohakah, Abuja 

The government of Rivers State Nigeria, has threatened to shut down the oil and gas-rich Bonny Island due to the alarming rise of Corona virus cases in the Island.

Rivers state last Tuesday emerged with stunning record when it shot into the second position in the daily, national COVID-19 chart published by the National Centre for Disease Control (NCDC) recording 103 cases after Lagos, which had 216.
The data further showed that Rivers state had so far recorded 592 cases with 347 active cases and 23 deaths. The governor, Barr Nyesom Wike who met with the traditional rulers of Bonny in Government House, Port Harcourt on Tuesday, said this is not acceptable.
He told them to commence enlightenment programs and educate their people on the Covid19 subject matter.
He said there was an urgent need for residents of the Island to cooperate with the state government to ensure that all COVID-19 protocols were obeyed to contain the spread of the pandemic in the area.
“Bonny is strategic to the national economy and we have to work together to ensure that the disease does not cripple the economy. We have to make our people to stop living in denial about the existence of COVID-19 because such attitude will not allow them to take the necessary precautions. The results of samples collected from Bonny indicate that it could be an epicentre of the pandemic in the state if a drastic action is not taken.
“It is not something our people should pretend that it does not exist. Something that has taken the world by storm and killing more than conventional warfare should be taken seriously. When this pandemic started in the State, I raised the alarm that 60% of the cases were from rig workers and had to impose lockdown of Port Harcourt and Obio/Akpor Local Government Areas.
“So many people were not happy. What will be my joy to close down businesses if not to save lives. I have the responsibility to make sure that the people that have given me their mandate are alive. Will I be governor of the dead? Some of us do not appreciate that we have to make sacrifices if that is going to save our people”.
He hinted that the State Security Council would meet on today to review the situation in Bonny and consider a possible lockdown.

Chibisi Ohakah, Abuja 

Nigeria has begun crude oil exploration in new locations along the Bida Basin, spreading across eight local government area of Niger state, two local government areas in Kwara state, and one local government area in Kogi state.

The Nigerian National Petroleum Corporation (NNPC) Group General Manager Frontier Exploration Services, Abdullahi Bomai dropped the hint when he paid courtesy call on Governor Abubakar Sani Bello of Niger on Wednesday.

According to Bomai, the Corporation is unveiling the 2D seismic data acquisition in the Bida Sokoto basin. He said the progress being made is capable of growing Nigeria’s reserve to 40 billion barrels by the year 2023. 

Abdullahi Bomai, who represented the NNPC’s group managing director at the meeting, said, “In depth geological and geochemical studies so far showed that there is strong hydrocarbon bearing indicators that have been confirmed as oil and gas bearing formations in 8 local government areas which extends to 2 other local governments in Kwara state and 1 Local Local government in Kogi state.

“Further exploration activities based on the need for exploration in the Bida Basin, NNPC management has graciously approved the award of contract to Integrated Data Services Limited (IDSL) and their alliance partners (BGP/CNPC International Nigeria limited to embark on immediate Seismic Data Acquisition to further unravel the presence of hydrocarbons in the Bida Basin.”

The NNPC chief told Governor Sani Bello that while efforts are being made to tap the potentials, “The NNPC is indeed delighted for the opportunity of today’s visit to inform you of the activities of NNPC/FES and also to solicit for your support.”

He stressed that significant progress is being made in the ongoing exploration of inland basins, with a realistic and achievable target of growing the nation’s reserve to 40 million by year 2023. “Today, we are glad to inform you of the commencement of hydrocarbon exploration in the sedimentary section of Niger state,” he told the governor.

While soliciting for the support, cooperation and participation of the states and local government councils, traditional rulers and community leaders towards achieving the national mandate, the NNPC chief said the deployment of light and heavy machineries along the basin will soon commence.

The affected local government areas to include; Mokwa, Lavun, Gbako, Bida, Katcha, Agaie, Edati and Lapai. Bomai said in the course of conducting the operations, a lot of skilled, semi-skilled and unskilled workers from Niger State will be engaged.

Governor Abubakar Sani Bello in his response expressed happiness over the realization of the project, stressing the need for the Corporation to pay adequate compensation to communities who would be affected by the oil exploration.

“We are all excited over the good news of the oil exploration. As you know, research in the development of the Bida Basin has been on for some times.

“We are, however, happy that the NNPC is seeing to the success of the project. We are hopeful that Niger state will join the oil producing states,” the governor told the NNPC delegation

Chibisi Ohakah, Abuja

Sparrows Group has completed its first project for ASRY (Arab Shipbuilding & Repair Yard) delivering crane condition evaluation services at the multi-service facility in Bahrain.

As part of ASRY’s extensive modernisation programme Sparrows carried out non-intrusive inspection of its 16 rail, crawler and floating cranes throughout April and May this year.

The scope of work involved detailed visual inspection of structural components, wire ropes and hook blocks as well as functional checks on safety limits and calibrations for the rated capacity indicator. Sparrows will now provide ASRY with a report of recommendations.

ASRY was established in 1977 and is the Arabian Gulf’s leading maritime repair and fabrication facility. The facility includes a drydock, two floating docks, 15 repair berths and twin slipways alongside a fabrication area, workshop and service centres.

Stewart Mitchell, chief executive officer at Sparrows, said: “ASRY is a well-known and respected name in the Middle East so we’re delighted to have worked on this project and hope to develop the relationship further.

“Diversification into new industries is a key part of our growth strategy and this work demonstrates how we can seamlessly transfer our expertise and capability to the marine and industrial sectors. The Middle East is an important region for us and having a local presence in the Kingdom of Saudi Arabia enabled us to support ASRY in Bahrain even during these challenging conditions.”

Sparrows has been active in the Middle East for over 25 years and in 2015 the company established a local presence in the Kingdom of Saudi Arabia. It was granted a commercial registration to operate last year and recently became the first company in the Kingdom to be awarded Approved Service Provider Recognition for crane maintenance and overhaul by the American Bureau of Shipping (ABS).

The Sparrows Group is a global provider of specialist equipment and integrated engineering services to the oil and gas, renewables and industrial sectors. 

Orient Energy Review

The Nigerian National Petroleum Corporation (NNPC) says its target to grow the nation’s reserve to 40 billion barrels by the year 2023.

Malam Mele Kyari, Group Managing Director, NNPC, disclosed this during the unveiling of 2D seismic data acquisition in the Bida/Sokoto Basin in Minna on Wednesday.

Kyari said that efforts were ongoing for exploration of inland basins with a realistic and achievable target of growing the nation’s reserve.

“Efforts in the search for hydrocarbons in the frontier basins have been intensified and more geological targets are identified for exploration,” Kyari said.

Represented by the Group General Manager, Frontier Exploration Services, Alhaji Abdullahi Bomai, the NNPC boss explained that 600 kilometers of two dimensional seismic data would be required as prospects in Bida Basin to further evaluate the potential of the basin.u

He said that the programme would cover eight local government areas in Niger state which include; Mokwa, Lavun, Gbako, Bida, Katcha, Agaie, Edati and Lapai, adding that two were in Kwara and one in Kogi.

According to him, a lot of skilled, semi-skilled and unskilled workers will be engaged into different categories, adding that the operations were usually associated with damage to land, crops and economic trees.

“It is the industry standard to assess such damages and provide appropriate compensations to affected persons and communities so as not to cause panic or disturbance,” he added.

The GMD disclosed that surface geochemistry, ground gravity/ magnetic, stress field detection, full tensor gradiometer aerial surveys had been deployed to further explore large areas and derrick prospects in the frontier basin.

He said they have also identified prospective hydrocarbon exploration targets in the basin.

Kyari added that the samples collection and preparation was carried out by IBB University Lapai consultancy services.

Responding, Gov. Abubakar Bello of Niger, commended the management of NNPC involved in the process research and expressed optimism that the state would soon be among oil producing state.

He said that the state government would give necessary support and cooperation needed for the commencement of hydrocarbon exploration in the state.

Bello noted that aside, revenue and financial advantages, it would create jobs and give Niger people the opportunity to acquire training on oil and gas.

“Beyond the financial benefits, it will bring about social and economic development of host communities, carry the communities along and engage them as host communities to avoid issues,” he said.

He advised them to meet with stakeholders of the affected communities for them to be aware of every activities.

Peace Obi with Agency report

Operators and suppliers in the global oil and gas industry have been urged to consider new technologies and strategic partnerships as part of their medium term strategies to mitigate the financial impact of oil price collapse.

Speakers at a recent webinar organised by ADIPEC themed: “Building Future Business Resilience through Technology, Innovation and Partnerships”, noted that it would help operators and suppliers unlock 20-50 per cent lower costs to survive in a $30 per barrel oil market

The Managing Director and Partner, Boston Consulting Group, Alexey Dolya who warned that the current industry crisis is significantly more severe than 2014, when oil prices fell by 40 per cent, said more than half of oil field equipment suppliers are at risk of bankruptcy if oil prices remain at $30 per barrel until the end of the year. 

According to Dolya if the oil and gas industry can implement new ways of working with its suppliers to mitigate financial distress, while building long-term procurement and supply chain resilience, the worst effects of the crisis could be avoided.

He said, in the short-term, operators need to have forward-looking transparency into vendor financial health to mitigate supplier distress. Adding that in the medium term, operators and suppliers need to consider new technologies and strategic partnerships to unlock 20-50 percent lower costs to survive in a $30 per barrel oil market.

“The current crisis is very different to what we have seen before. Supplier prices have not yet recovered from the last crisis and many vendors’ health is much weaker.

“However, the response of oil and gas operators has been similar to 2014, with activity cuts and requests for price cuts putting suppliers at risk of bankruptcy.

“Instead, operators should look to the automotive and defence industries, where there is close collaboration with suppliers and both sides learn from each other.

“Operators need to build forward looking models to try to understand how long supplies can last in the current environment and work with suppliers to unlock significant potential from alliances and strategic partnerships,” Dolya said.

According to BCG, unilateral measures to mitigate financial pressures on suppliers could include extending preferential rates; front loading ordering of products; improved access to finance, including direct lending to suppliers, direct payment of Tier 2 suppliers, bank guarantees and measures to safeguard against default, including an option to purchase, sell-off or recover input materials.

Meanwhile, cross-operator levers could include government support packages for the oil field equipment supply industry, including tax exemptions; structural guarantees for key industries; greater clarity on the demand pipeline and coordinated cross operator bail-out efforts.

The ADIPEC Webinar series is a weekly online thought leadership event created by dmg events, organisers of the annual Abu Dhabi International Exhibition and Conference. Featuring key stakeholders and decision-makers in the oil and gas industry, the dialogues focus on how the industry is evolving and transforming in response to the COVID-19 pandemic and the rapidly changing energy market.

ADIPEC attracts more than 155,000 energy professionals from 67 countries; including senior decision-makers and energy industry thought leaders, over 2,200 exhibiting companies and 23 national exhibiting pavilions as oil and gas companies convene to share views and best practices to address the long-term impact of the triple challenge of lower oil prices, weaker demand and over supply

Peace Obi

South Africa’s cabinet has recently approved the decision to merge PetroSA, iGas and the Strategic Fuel Fund to form a single national oil company.

The approval follows a briefing on continuing efforts to streamline the state-owned Central Energy Fund’s (CEF) oil and gas subsidiaries. The Minister of Mineral Resources and Energy, H.E. Gwede Mantashe, told lawmakers the CEF companies would be restructured as part of broader government efforts to stabilize troubled state-owned enterprises (SOE).

South Africa has more than 740 SOEs, which the government has been looking at either consolidating or rationalizing. “This gives effect to the announcement made by President Cyril Ramaphosa in his State of the Nation Address on 13 February 2020, to repurpose and rationalize a number of State-owned enterprises to support growth and development,” the cabinet said in a statement.

The rationalization plan will be achieved in three phases, phase one will focus on improving efficiencies, which will result in enhanced cost reductions, integrated common systems, processes and improved shared service models to maintain strategic relevance and sustain a competitive edge in a rapidly changing oil and gas industry.

The second phase will work on improving scale and market share, the implementation of the rationalization process would, among other interventions, enable the CEF to effectively leverage on the combined financial resources and operating assets of the three entities to bring stability and certainty to ensure that the country is ready to achieve a just and fair energy transition.

The third and last phase will operationalize a commercially viable national petroleum company, which is expected to be a game-changer not only for South Africa but for the continent as a whole.

The new entity will play a vital role in endorsing wider policy efforts by the government, as well as fostering national cooperation on oil and gas issues.

AOP