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Kuwait Oil Company Declares State Of Emergency Following Onshore Oil Spill

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...refuses to disclose exact spot of spill

The Kuwait Oil Company has declared a state of emergency following an oil spill in the west of the country. The company is state-owned by one of OPEC’s frontline producers.

AFP reported that no persons or infrastructure have been injured or tampered with following the oil spill. Also there have not been any oil production disruption after the incident, the agency quoted the company.

Kuwait’s Al Rai newspaper published a photo of oil gushing out of an oil well, also saying that there have not been injuries reported or any disruption to production.

Also Read: Eni Announces Discovery Of Oil Sureste Basin, Offshore Mexico

No toxic fumes have been reported, either, company spokesman Qusai al-Amer was quoted as saying.
The leak “occurred on land but not in a residential area”, the spokesperson later told AFP, but declined to specify the exact location of the spill.

Kuwait Oil Company said it has already sent emergency response teams to determine the source of the leak and contain the oil spill, the spokesman added. Previously, the company reported oil spills from the fields it operates in 2016 and in 2020.
Kuwait, one of the largest producers in OPEC, pumps around 2.7 million barrels of per (bpd) of crude oil. At 2.683 million bpd production in February, per OPEC’s secondary sources, Kuwait is the fourth-largest OPEC producer after Saudi Arabia, Iraq, and the United Arab Emirates (UAE).

Kuwait, alongside Saudi Arabia and the UAE, is one of the few major oil-producing countries to target an increase it its oil production capacity. Kuwait has a plan to boost its production capacity to 4.75 million bpd by 2040.

Also Read: Four Of France’s 6 Refineries To Shut Down Operations Today As Protests Escalate

Scott Sheffield, CEO at the largest pure-play shale producer, Pioneer Natural Resources, told the Financial Times on the sidelines of CERAWeek earlier this month, “I think the people that are in charge now are three countries — and they’ll be in charge the next 25 years.” “Saudi first, UAE second, Kuwait third.”

By Bosco Agba

NCDMB Hosts Nigerian Oil And Gas Opportunity Fair in Yenegoa

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The Nigerian Content Development and Monitoring Board (NCDMB) has explained that it decided to hold the 4th and Nigeria Oil and Gas Opportunity Fair [NOGOF] physically to offer small and medium income enterprises the greater opportunity to showcase themselves.
The biennial Fair comes up at the NCDMB Conference Center, in Yenegoa, between 17 and 19 May 2023, with the theme “The oil and gas industry – catalyst and fuel for the industrialization of Nigeria.”

The event, which was introduced by the Mr. Simbi Kesiye Wabote, started 2017, with the inaugural edition held at Uyo, Akwa Ibom state, has consistently showcased short to medium term plans and activities of operators and project promoters in the upstream, midstream, and downstream sectors of the Nigerian oil and gas industry.

The NCDMB chief executive had explained that the showcase of upcoming projects is intended to give Nigerian service companies ample opportunity to build relevant capacities that might be required to execute the projects in-country, thereby creating employment opportunities, and retaining spend in-country.

Also Read: NCDMB, BOI Launch $50m Fund For Oil Sector Manufacturers

The goal is to reassure stakeholders of the industry that opportunities still abound in the Nigerian oil and gas industry and encourage them to look forward and invest in the sector, despite concerns about energy transition and other emerging developments in the global oil and gas industry.

The agenda of the event this year would focus on industry linkages as well as opportunities within the African continent. The event promises to showcase opportunities that exist in the industry over the next three to five years and presentation will be made by over 20 international and indigenous oil and gas companies.

Some of the topics that will be discussed at NOGOF 2023 will include upstream opportunities, linkage industry opportunities, gas and downstream opportunities, financing and investment, environmental, social and government (ESG) and sustainable and regional opportunities with members of the African Petroleum Producers Organisation, (APPO).

Also Read: Nigeria Content Development Management Board Emerges Best MDA in Efficiency, Transparency In Nigeria

Other topics will include topical and challenging issues currently facing the oil and gas industry, with the goal of finding lasting solutions in the industry.

The event will be attended by both government and private organisations, which would come from international and indigenous oil and gas companies, federal government agencies, financial sector and linkage industries.

By Bosco Agba

NGA Opens Its Learning Solutions Training Series For Stakeholders

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The Nigerian Gas Association [NGA] has announced the opening of its Learning Solutions Training Series coming up between March 27 and 30, 2023.

The four-day training event comes under the theme, “Understanding the Natural Gas Value Chain End to End”.
NGA said in a statement that the webinar is a certificated course/training program with the objective to provide a comprehensive insight into the Nigerian gas sector.

The training also enables participants to develop a greater understanding, interest and appreciation of the Nigerian Gas Industry Value Chain.

With the recent declaration of Nigeria’s decade of Gas, and with the backdrop of the global changes due to the Energy Transition, the accelerated pace of change in the Nigerian gas industry is expected to reveal and create value and opportunity in equal measure from our vast gas resources.

Also Read: NCDMB Concludes Training of 100 Youths on Solar Power Installation In Suleja

“This course will provide participants the opportunity to examine the regulatory, commercial and technical aspects of the natural gas value chain in Nigeria and beyond,” the NGA said

He organisers said the course content will consist of several in-depth modules delivered by industry subject matter experts, with attendee interaction and question & answer segments, lasting from 0900 – 1700 hrs each day.

The event will be recorded for registered participants who are unable to attend physically, to watch at their convenience. The course fee is ₦60,000 per attendee (NGA associate members) and ₦90,000 per attendee (non-NGA members).

Facilitators include Dr. M. M. Ibrahim, chairman, national gas expansion programme; Clare Ohiro, associate, templars; Dr. Excel Ukpohor, lead, non tech interface NLNG T7 project; Iheanacho Ibegbulem, GM PNG Gas ltd; and Norbet Shialsuk, lead partner/CEO Ecocity Projects.
Other facilitators include, Chukwueme Osuji, partner Olaniwun Ajayi; Fisoye Delano, President, Delhpi Venture Group LLC; Prof Stephen Ogaji, GM, Fuel and Gas/PPP[SP] Niger Delta Power Holding [NDPH] Ltd; Olawunmi, CEO Cabtree Ltd & SLA to Senate President; and an array of high level consultants in the oil and gas industry.

Also Read: NCDMB, BOI Launch $50m Fund For Oil Sector Manufacturers

Course coverage include Gas to Power; Regulatory Framework; LPG, CNG, LNG; Gas Networth Code; Investment Opportunities & Energy Transition; Contracts, Pricing, Marketing & Sales; Gas Based Industries; Domestic Gas Utilization; Processing,

By Ken Okoye

Former NNPC Chief, Anibor Kragha, Re-Elected African Refiners Association Helmsman

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Former chief operating officer (COO), of erstwhile Nigerian National Petroleum Corporation (NNPC), Anibor Kragha, has been re-elected as executive secretary of the African Refiners & Distributors Association [ARDA].

Kragha is said to have led the organization since 2020, through some of the challenging times in global history, hence the unanimous decision by the organisation to reelect him in office.

During his first term, Kragha is reported to have created value for the organization by promoting its objectives, improving interaction between African refiners and distributors and international marketing, trading, engineering and financial service companies.
On the investment side, Kragha reiterated his focus on improving financing channels for downstream players. An advocate for the establishment of the African Energy Transition Bank – an African based financial institution that would provide access to financing local content African energy projects.

He recognizes the role the private sector in expanding the downstream market, and drives the narrative that Africa’s more-than 56 development finance institutions need to step up and finance Africa’s energy future.
His engagement with stakeholders, ability to navigate challenges and commitment to advancing Africa’s downstream sector all represent key attributes that led to his re-election.

Also Read: NNPC, NUPRC Differ On Nigeria’s Increased Oil Output Data

The erstwhile NNPC chief has been a long-standing supporter of investing in Africa’s infrastructure projects. He believes that energy security represents a short-term priority in Africa while driving the energy transition represents a long-term objective.

With more than 600 million people without access to electricity and 900 million without access to clean cooking solutions, scaling up infrastructure developments through the construction and upgrading of refineries, pipelines and import-export terminals represent the solution to driving long-term and sustainable socioeconomic growth in Africa.

Kragha has been steadfast in his commitment to strengthening energy security in Africa, advocating for strong, aligned government policies, sustainable financing mechanisms and the development of widespread supply chains through investments in refining, storage and distribution.

On the other hand, he recognizes the significant impacts climate change poses on the continent as well as the need to transition to a cleaner energy future. He represents a strong advocate for a robust energy mix; the establishment of carbon credits and an African carbon credit trading platform to accelerate the creation of quality credits that are sought globally; and the advancement in the development of cleaner fuels such as natural gas.

Under his leadership, ARDA is working towards partnering with industry on the development of an African Downstream Transition Plan which will enable the organization to determine key areas of need in investment on a decade-by-decade basis.

Also Read: NNPC Acquires OML 18 From Operator, Eroton Exploration And Production

By facilitating dialogue between African downstream players and international investors, advocating for the maximization of crude oil in Africa through the production and distribution of cleaner fuels via integrated storage and distribution infrastructure, and providing tangible financial solutions for African countries, Kragha delivers a unified voice regarding Africa’s energy future.

“We are proud to see Anibor Kragha being re-elected for a second term as Executive Secretary at ARDA. Since his appointment in 2020, Kragha has led the organization through the COVID-19 pandemic, economic uncertainty caused by geopolitical factors and various other market-related challenges.

And despite all of this, Kragha has been resilient; not only ensuring the organization is surviving but is thriving. During his first term, Kragha played an instrumental part in expanding the downstream sector through engaging with stakeholders, offering tangible solutions to challenges while promoting Africa’s needs in the current global energy climate.

“We are looking forward to what Kragha will do during his next term, and as the voice of the African energy sector, offer our support to him and ARDA as they continue to drive Africa into a new era of market growth and success,” states NJ Ayuk, executive director, African Chamber

Also Read: NNPC Flaunts The Success Of Over 1.6mbpd Oil Output

“We are proud to see Anibor Kragha being re-elected for a second term as executive secretary at ARDA. Since his appointment in 2020, Kragha has led the organization through the COVID-19 pandemic, economic uncertainty caused by geopolitical factors and various other market-related challenges. And despite all of this, Kragha has been resilient; not only ensuring the organization is surviving but is thriving.

During his first term, Kragha played an instrumental part in expanding the downstream sector through engaging with stakeholders, offering tangible solutions to challenges while promoting Africa’s needs in the current global energy climate. We are looking forward to what Kragha will do during his next term, and as the voice of the African energy sector, offer our support to him and ARDA as they continue to drive Africa into a new era of market growth and success,” states NJ Ayuk, executive chairman of the AEC.

By Ken Okoye

Eni Announces Discovery Of Oil Sureste Basin, Offshore Mexico

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Italian oil and gas major, Eni has announced the discovery of oil in the Sureste Basin offshore Mexico in a prospect that could contain around 200 million barrels of oil in place.

Making the announcement last Friday, Eni said the discovery was made on the Yatzil exploration prospect in Block 7, which is located in the mid-deep water of the Cuenca Salina in the Sureste Basin.

It is not the first time Eni discovered oil in the basin. Three years ago, the Italian energy company announced a discovery in the Sureste Basin, saying it could contain between 200 and 300 million barrels of crude oil.

Also Read: Kenyan Government Discusses Decarbonization Initiatives, Others With Eni

That discovery was made in Block 10, in which Eni is the operator and holds the majority stake. In Block 7, the joint venture partners include Eni, which is the operator with a 45% stake, Capricorn with 30%, and Citla Energy with a 25% interest.

Today, Eni said that Yatzil-1 is the second commitment well of Block 7 and the eighth successful one drilled by Eni in the Sureste Basin.
The new oil discovery is located approximately 65 kilometers (40 miles) off the coast and 25-30 km (15-18 miles) away from other discoveries.

“The successful result comes after the Saasken and Sayulita discoveries in Block 10 and confirms the value of Eni’s Mexican asset portfolio, contributing to the potential synergic cluster development of several prospects located nearby,” Eni said in a statement on Friday.

Also Read: Italian Energy Giant, Eni Posts Highest Annual Earnings In Over A Decade

Eni considers Mexico as a core country to its organic growth. Currently, the Area 1 phased development project led by a consortium comprising Eni produces more than 30,000 barrels of oil equivalent per day (boepd). The full project is expected to be completed by 2025, the Italian company said.

Eni, which has been present in Mexico since 2006, holds rights in eight exploration and production blocks – including six as operator, all located in the Sureste Basin in the Gulf of Mexico.

By Bosco Agba

Russian Oil Firm, Lukoil Grabs 2 Offshore Blocks In Congo

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Russian oil company, Lukoil has secured rights to two offshore energy blocks in the Republic of Congo in partnership with Eni, the Italian oil major.

The rights to the offshore blocks, known as Marine 24 and Marine 31, are now held by Lukoil with a 43% interest, Interfax said. Lukoil said that Congo accepted its application for the blocks, submitted with partner Eni.

However, the report said the commercial terms for the venture have yet to be agreed  on. Lukoil already has a presence in the Republic of Congo in the Marine XII project, operated by Eni.

Also Read: Russia Now Use Ship-To-Ship Transfers To Boost Diesel Exports To S/Arabia

“First of all, we are interested in projects where Lukoil could act as operator. We have discussed a number of such opportunities today,” Lukoil’s Vice-President for America, Africa and the Middle East, Ivan Romanovsky, said after a meeting with the Congolese minister of hydrocarbons, Bruno Jean-Richard Itoua.

Lukoil purchased a 25% stake in Marine XII in 2019 for $800 million. Eni, which holds a 65% stake in the project, signed a contract with China’s Wison Heavy Industry to build an FLNG installation with a capacity of 2.4 million tonnes.

While Congo and Eni appear to be welcoming Lukoil with open arms, other projects Lukoil has sought to proceed with are being held up thanks to sanctions-related cold feet. In Ghana, Lukoil is looking to sell its stake in the Peacan field development because banks have been nervous about getting involved due to sanctions.

Also Read: IEA Reports Says Russia’s Oil Revenues Are Dwindling Due To Sanctions

It is said also that Aker Energy, Lukoil’s partner, grew nervous about moving forward on the project with the private Russian oil company.
Lukoil also recently was approved by Iraq’s Thi-Qar Oil to develop the Eridu oilfield after submitting a development plan back in 2021.

By Ken Okoye

Four Of France’s 6 Refineries To Shut Down Operations Today As Protests Escalate

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It is estimated that by today, Monday, four out of France’s six refineries will shut down as strikes escalate after French President Emmanuel Macron pushed through with a controversial pension reform without a vote in Parliament.

Earlier last week, the president pushed to pass the reform without a vote in Parliament under a parliamentary clause known as 49:3.
The pension reform proposes to raise the retirement age in France by two years to 64. Macron’s move without a parliamentary vote sparked even more protests and street blockades in Paris and other cities in the country.

The strikes in France against the reform began in February and escalated this month, with workers in many sectors, including refinery workers, joining the industrial action.

Also Read: France Faces High Risk Power Supply Squeeze In January

Refinery workers told Argus last Friday that the strikes have disrupted power supply, refining operations, and fuel deliveries for nearly two weeks. 

Now most of France’s refineries are expected be closed down by March 20, also because of a lack of crude deliveries due to strikes among port workers which prevent the discharging of crude cargoes.

Two refineries run by supermajor TotalEnergies, the 219,000 bpd Donges and the 246,900 bpd Gonfreville refineries, as well as ExxonMobil’s 207,100 bpd Port Jerome facility and the 210,000 bpd Lavera refinery of Petroineos are all expected to be shut down by Monday, workers tell Argus.

Also Read: Energy Crisis: Germany, France Shift Talks After Cracks Appeared On EU Ranks

In ExxonMobil’s case, it is said that the refinery is stopping operations because it lacks the crude needed to keep the facility running. 
Apart from refining operations, the strikes have disrupted LNG imports into France as LNG import terminals have been shut down. France has four LNG receiving terminals, Dunkirk, Montoir, Fos Cavaou, and Fos Tonkin. 

As the strikes entered their second week, at least seven LNG cargoes heading to France have changed course and are now headed to import terminals in the Netherlands, the UK, and Spain since the strikes started.

By Ken Okoye

Atomic Energy Agency Raise Alarm: 2.5 Tons Of Uranium Missing From Libya

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“Loss of knowledge about location of nuclear material may present a radiological risk, as well as nuclear security concerns” 

The International Atomic Energy Agency (IAEA) has raised alarm that some 2.5 tons of Ghadafi-era natural uranium has disappeared from a site in Libya.

The site happened to be outside the control of the Tripoli-based Government of National Unity (GNU).
IAEA inspectors said they found out that 10 drums containing approximately 2.5 tons of natural uranium in the form of UOC (uranium ore concentrate) previously declared by (Libya) “…. as being stored at that location were not present at the location,” the global nuclear watchdog said in a Wednesday statement delivered by IAEA head Rafael Grossi.

“The loss of knowledge about the present location of nuclear material may present a radiological risk, as well as nuclear security concerns,” Grossi added.

Also Read: Head Of Libya Oil Corporation Assures That American Oil Firms Will Return

Libya’s long-running civil war had prevented the IAEA from inspecting the site earlier.
While the Agency has not indicated the exact location of the site, there is high probability that the site is Sabha, some 400 miles south-east of the western capital, Tripoli.

The area is not controlled by the government. Raw uranium, or yellow cake, is also believed to be stored at the Tajura nuclear research facility near Tripoli; however, this area is under control of the GNU. 

Sabha was a Ghadafi-era facility that had hoped to eventually enrich uranium for a nuclear weapons program until it was mothballed in 2003.

Also Read: Libya Looks Forward To First Oil And Gas Licensing Round In 20years

The IAEA has vowed to investigate the circumstances surrounding the disappearance of the uranium.
The concern is that while natural uranium cannot be used either for energy or weapons without a complicated enrichment process, if it ended up in the wrong hands it could be sold to regimes with this capability.

Speaking to the BBC, Scott Roecker from the Nuclear Threat Initiative, said that in its current form, the natural uranium “cannot be made into a nuclear weapon”, but could be used as a “feedstock” for a nuclear weapons program.
He also noted that the material “doesn’t really have any radiation in its current form”.

By Bosco Agba

NCDMB Concludes Training of 100 Youths on Solar Power Installation In Suleja

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The Nigerian Content Development and Monitoring Board (NCDMB) has concluded the training and empowerment of 100 youths in Suleja, Niger state, on solar power installation and maintenance.

The training, which lasted for one month, drew participants from three zones of Niger State, notably Minna, Bidda and Suleja.
Speaking during the graduation ceremony last weekend, NCDMB general manager, planning, research, and development, Mr. Abdulmalik Hallilu, representing the executive sectary, Mr. Simbi Kesiye Wabote, highlighted that NCDMB conducted the training as part of the Board’s youth empowerment programme.

He explained that the exercise is aimed at contributing to the federal government’s goal of reducing the unemployment rate in the country, as well as achieving the Board’s mission of catalysing the linkage sectors of the oil and gas industry.

He added that renewable energy, especially solar energy is getting traction not only in Nigeria but around the world, and that is because of the clamour for energy transition, which is the push to reduce the utilization of fossil fuels and replace those fuels with renewable energy sources.

Also Read: Nigeria Content Development Management Board Emerges Best MDA in Efficiency, Transparency In Nigeria

Halilu explained that the training was designed to provide the trainees with theoretical and practical knowledge and skills on solar power value chain, including installation, maintenance, repair and entrepreneurship.

He mentioned that the programme was designed to make the students self reliant, by providing them with tool kits, two months exit stipend and providing them shops in their communities to start their business.

He also added that the students will be supported to form cooperatives societies, which would enable them access Federal Government’s support funds associated with solar power.

The general manager further advised the graduating students to hone their newly acquired skills, encouraging them to show professionalism, quality assurance and innovation.

Also Read: NCDMB, BOI Launch $50m Fund For Oil Sector Manufacturers

He also advised them to create customer database and maintain lasting partnerships so their businesses would thrive.
He described the trainees as ambassadors of the Board and charged them to show good character and integrity wherever they are.
In their testimonies, the graduating students confirmed that they learnt the intricacies of solar power installations and expressed their appreciation for NCDMB for providing them with the opportunity, which would help them to be self reliant and help their communities.
Ealier in his comments, the NCDMB chief supervisor, media and publicity, Mr. Obinna Ezeobi said the success of the Board’s human capacity development initiatives is anchored on the end-to-end strategy of the programmes.

This strategy is demonstrated in the quality of the curriculum and the provision of tool kits, exit stipend, rental of shops and support system deployed for the programme. He lauded the organisers of the training – Boss Engineering for the high quality tool kits it provided for the trainees, noting that it portrayed the seriousness of the project.

Highlights of the programme included the practical demonstration of solar installation by students and the presentation of certificates and tool kits.

Also Read: Buhari Urges Contractors To Apply Local Content In Oloibiri Museum Project Construction

Similar trainings are ongoing at Oyo State and are being held in Ibadan, Oyo town and Ogbomosho as well as in three locations in Cross River State, namely Calabar, Bekearra and Ogoja.

Ghana Removes Fuel Subsidy, Implements Reforms

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The Ghana National Petroleum Authority (NPA) has confirmed that the country has implemented controversial regulatory measures, including the removal of fuel subsidy to ensure stability across its downstream sector.
The Authority said the removal of the subsidy is part of the country’s implemented regulatory measures to ensure stability across its downstream sector.

Chief executive officer of NPA, Mr. Abdul Hamid, dropped the hint during a presentation at the ongoing Africa Refiners and Distributers week 2023, in Cape Town, South Africa.

“We have removed subsidies and deregulated our markets. Industries were shutting down because the government was finding it hard to find the money to provide subsidies and to this day industry is being powered by investments in the private sector and there are no complaints of supply.

“We are ensuring affordability and security for the vulnerable consumers through the removal of energy subsidies,” he said while speaking on more reforms implemented in the NPA,” he said

According to Hamid, “the Ghanaian government has eliminated energy subsidies through the NPA.”
He disclosed the plans were implemented in response to the global oil and gas market volatility caused by the Russian-Ukraine war and energy transition-related policies.

Also Read: Nigeria Urges UK Court To Overturn P&ID $11bn Judgement Debt

“For the first time in 30 years, we have installed fuel caps as a measure to intervene and to control market instability,” he disclosed.
Hamid added that the NPA has also created a special fund to assist refineries in boosting Ghana’s production capacity to 50 barrels of oil in order to meet the country’s growing internal demand.

Hamid explained further that the removal of subsidies and deregulation of the markets have led to more investment in the private sector, which has in turn boosted the industry, resulting in a more stable market without supply complaints.

The NPA told the audience that before now the Ghanaian government’s inability to provide subsidies led to industries shutting down.
“These plans were put in place in response to global oil and petrol market volatility caused by the Russian-Ukraine war and energy transition He added that “the NPA is now ensuring affordability and security for vulnerable consumers through the removal of energy subsidies.
“This is part of the reforms implemented by the NPA to improve policies.”

To further justify its actions, the National Petroleum Authority (NPA) called a press conference in Accra yesterday stressing that the subsidy on Residual Fuel Oil [RFO] had become unsustainable because the subsidy on it was affecting its supply.

Also Read: TotalEnergies’ $20bn LNG Export Facility in Mozambique To Delay For Another 4yrs

It explained that the suspension of the subsidy was to ensure regular supply of the product to the industry, since the high price of fuel and the continuous depreciation of the Cedi against the dollar have made it unsustainable to keep the subsidy on RFO.

The press conference was addressed by the head of economic regulation of NPA, Mr. Abass Ibrahim Tasunti. He said the revenue the country was generating from the Price Stabilization and Recovery Levy had not been enough to pay for the subsidies accruing from RFO and premix fuel.

“The suppliers of this product (RFO) are refusing to supply because the subsidies are not being paid on time. Also, because the subsidies are not being paid on time, the companies have refused to supply the product.

“They sell and they are not recovering the full cost, and they are also not getting the subsidies paid to them,” he said.
The government paid GHc136 million as a subsidy on RFO in 2021 and again paid GHc52 million out of the total subsidy of GHc154 million for the period January to September 2022, leaving a balance of GHC102 million.

He said the NPA had engaged players in the manufacturing sector on the challenge in the supply of RFO and the resolution was that in the meantime, the subsidy on RFO should be removed so that they could pay the full cost to ensure regular supply of the product and get their factories running.

“The industry prefers to pay the full cost of RFO, so they can continue running their factories than not to have their products at all,” Mr. Tasunti said.

Also Read: Nigeria’s Energy Transition In Focus At Middle East Energy Conference

He said the alternative product that the manufacturing industry could use was diesel but the cost of the product was very high now.
When the Price Regulation Policy was introduced in July 2015, the government decided to keep subsidies on RFO and premix fuel.
And to ensure that these subsidies are funded, the Energy Sector Levies Act introduced a levy called the Price Stabilization and Recovery Levy to pay for subsidies on RFO and premix.

Mr. Tasunti said the revenue that would be generated from the Price Stabilization and Recovery Levy would be focused on only premix fuel for now, while the subsidy on RFO would be taken off until things change.

However, the government through the NPA has suspended the subsidy on Residual Fuel Oil (RFO), the fuel used by the manufacturing sector, effective November 1, 2022.

By Ken Okoye

Oil Price Falls To $72 A Barrel, First Time In 2yrs

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Oil price fell on Wednesday to $72 a barrel for the first time in more than one year. Brent crude, the global oil benchmark, fell over 5% to $72.39 a barrel — first time since December 2021.

The US West Texas Intermediate also fell over 5 percent to $67.06 a barrel. According to Reuters, the price of the commodity dropped as worries about Credit Suisse shook global markets and countered expectations of a recovery in Chinese oil demand.
Credit Suisse shares slumped by 30% on Wednesday after Saudi National Bank (SNB), its largest shareholder, said it could not provide further support.

“It doesn’t matter what your risk asset is, at this point people are pulling the plug on across different instruments here,” Robert Yawger, director of energy futures at Mizuho in New York, told Reuters.

Also Read: Oil Prices Dip As Market Await Chinese Demand To Rebound

“Nobody wants to go home with a big position on anything today… you have nowhere to hide really.”
Also speaking on the dip, Dennis Kissler, senior vice-president of trading at BOK Financial, said hedge funds were liquidating due to rising interest rates and economic uncertainty.

He said heavy pressure on the United States stocks earlier today, was adding to the fund liquidation in crude.
The current price of the commodity is now below the $75 benchmark in Nigeria’s 2023 budget. In 2020, when a similar situation occurred, Mrs. Zainab Ahmed, minister of finance, said Nigeria would lower the $57 benchmark.

“What the impact will be on that is that there will be reduced revenue to the budget and it will mean cutting the size of the budget. The quantum of the cut is what we are supposed to assess as a committee,” she had said.

Also Read: Russia May Be Beating Oil Price Cap – Institute

If Ahmed’s words are to be considered, it means the federal government may consider revising the country’s benchmark to fit the global oil price — if the downward trend is not reversed.

An oil and gas analyst Meristem Securities Ltd, Bolade Agboola, told newsmen yesterday in Lagos that the advantage of the global oil price remaining above Nigeria’s benchmark is that the federal government will earn more revenue to finance its budget.

By Bosco Agba

IEA Reports Says Russia’s Oil Revenues Are Dwindling Due To Sanctions

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Models of oil barrels and a pump jack are displayed in front of Ukrainian and Russian flag colors in this illustration taken, February 24, 2022. REUTERS/Dado Ruvic/Illustration


The International Energy Agency (IEA) has said that Russian revenues from oil fell in February as exports declined after the EU embargo on oil product imports from Russia by sea. 

In its Oil Market Report for March, IEA said last month, the country’s total oil exports dropped by 500,000 barrels per day (bpd) to 7.5 million bpd as the EU embargo on refined oil products came into effect.

“Revenues are already dwindling,” the IEA noted, adding that Russia’s estimated oil export revenues fell to $11.6 billion in February, down by $2.7 billion from January when volumes were significantly higher, and nearly half pre-war levels.

Also Read: Russia Insists That Price Cap Against Its Oil Is Not Working

“Russian fiscal receipts from oil sales were up 22% from January after export taxation rules were adjusted, but at $6.9billion, just 45% of the level from a year earlier, according to the Russian finance ministry,” the IEA said.

Russian shipments to the EU plunged by 800,000 bpd to 600,000 bpd,  compared with more than 4 million bpd at the start of 2022. Shipments to China and India also fell, while cargoes without a destination surged by 600,000 bpd to 800,000 bpd, the IEA said in the report.

“It remains to be seen if there will be sufficient appetite for Russian oil products now that the price cap is in place or if its production will start to fall under the weight of sanctions,” the agency said.

Also Read: India Not Bound By EU, America’s Price Cap Sanctions

In the global oil market, supply is currently outstripping “still-lacklustre demand,” and stocks have built to levels not seen in 18 months, according to the IEA.

“Much of the supply overhang reflects ample Russian barrels racing to re-route to new destinations under the full force of EU embargoes.”
“The G-7 sanctions regime has been effective in not restricting global crude and product supplies, while simultaneously curtailing Russia’s ability to generate export revenue,” the IEA said in the report.

By Ken Okoye

Russia Expects Its Oil Output To Drop In 2023

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Russia expects its oil and gas production to fall this year compared to 2022, partly due to the production cuts announced for March, Russian Energy minister, Nikolai Shulginov, told lawmakers on Wednesday.

“For 2023, we expect oil production levels to be slightly lower, also because of the voluntary reduction in output,” Shulginov was quoted as saying by Russian news agency Interfax.

“Gas production volumes will continue to decline both due to the abandonment of the European market and the timing of the re-routing of energy flows to the East,” the Russian energy minister added.

Also Read: Russia Now Use Ship-To-Ship Transfers To Boost Diesel Exports To S/Arabia

He said Russia’s decision to reduce its oil production this month will help balance the global oil market, which is in a surplus now, Alexander Dyukov, chief executive of Russian oil company Gazprom Neft, said later in February.

The Russian production cut could be “a sign that Moscow may be struggling to place all of its barrels,” or “may be an attempt to shore up oil prices,” the International Energy Agency (IEA) said in its Oil Market Report for February.

In the report for March published today, the IEA said, “It remains to be seen if there will be sufficient appetite for Russian oil products now that the price cap is in place or if its production will start to fall under the weight of sanctions.”

“Revenues are already dwindling,” the agency noted. The Kremlin does not and will not recognize any price cap on its oil, Kremlin spokesman Dmitry Peskov said last week.

Also Read: Russia Insists That Price Cap Against Its Oil Is Not Working

Earlier in the week, U.S. Energy Envoy Amos Hochstein had said that the price cap on Russia’s crude oil and oil products was working well.
“I think the beauty of the process is that it is working and that Russian oil and Russian products are being traded below the price cap,” Hochstein said on the sidelines of the CERAWeek energy conference, as carried by Reuters.

By Bosco Agba

OPEC Now More Optimistic On China’s 2023 Rebound Forecast

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OPEC has been forced to reverse up its forecast on China’s reopening; now says the Covid19 ridden country’s reopening is set to add momentum to global economic growth.

In its closely-watched Monthly Oil Market Report (MOMR) yesterday, OPEC said, “In the emerging economies, China’s reopening, following the lifting of the strict zero-COVID-19 policy, will add considerable momentum to global economic growth”

The report said China’s oil demand is expected to average 15.56 million barrels per day (bpd) in 2023, up by 710,000 bpd compared to last year. That’s higher than the 590,000-bpd growth expected in last month’s report.

Also Read: OPEC Expresses Fear That China’s 2023 Oil Demand May Hit 600,000bpd

Despite the upward revision of Chinese demand, OPEC left its world oil demand growth forecast unchanged from the February estimate, expecting growth of 2.32 million bpd this year. That’s because upward revisions for Chinese demand are being offset by downward revisions in North American and European demand for the first half of 2023 “due to an expected slowdown in economic activity in OECD Americas and OECD Europe.”

OPEC however cautioned that its estimate of global growth in economy and oil consumption has a high level of uncertainty due to a number of upside and downside risks.

Upsides include the Fed managing inflation in the latter half of this year with sufficiently healthy underlying demand, a possible better-than-expected performance in the Eurozone, and acceleration in China.

Also Read: Nigeria Targets Additional 400,000mb/d To Achieve OPEC Quota

A stronger-than-anticipated rebound in China, with consumption accelerating significantly, following years of stringent lockdown measures, is another factor to be considered,” OPEC said.

Last month, the International Energy Agency (IEA) said that China’s resurgent oil demand – with growth seen at 900,000 bpd this year – and the rest of the Asia-Pacific region will dominate global growth.

“China accounts for nearly half the 2 mb/d projected increase this year, with neighbouring countries also set to benefit after Beijing ditched its zero-Covid policies,” the IEA said in its February report. The March report is due out today, Wednesday. 

By Bosco Agba

San Leon Energy Speaks From Eroton’s Side In The OML 18 Crisis

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San Leon, the independent oil and gas production, development and exploration has said that its economic interest in OML 18 is not impacted by a possible change of operatorship of OML 18. From all indication, it is obvious San Leon is on the side of Eroton
San Leon noted that after the NNPC took over OML18, Eroton had emphasised that it remained the operator of OML 18 in line with the provisions of the Joint Operating Agreement governing OML 18 (“JOA”).

Eroton stated clearly that “the purported attempt by the non-operators of OML-18; NNPC Limited (NNPC) and Sahara Field Production Limited (Sahara) (now known as OML 18 Energy Resource Limited) to appoint NNPC Eighteen Operating Limited as operator of OML 18 is a breach of the JOA as any dispute whatsoever between the parties must be addressed by the dispute resolution provisions of the JOA.”

Eroton said there can be no removal of an operator without following these procedures and the process is designed in such a way that notice requirements cannot be waived, and the removal of an operatorship can therefore not be carried out, without following the process provided in the JOA.

Also Read: NNPC, NUPRC Differ On Nigeria’s Increased Oil Output Data

Eroton has issued a notice of arbitration to NNPC and Sahara in accordance with the terms contained in the JOA to defend its legal rights. Furthermore, Eroton has received a legal opinion that it continues to remain as operator pending such resolution and that this will be upheld by the courts of Nigeria.

Eroton further noted that the action taken by NNPC and Sahara sets a damaging precedent in the oil & gas industry in Nigeria because due process has not been followed.

Eroton took over operatorship of OML 18 in 2015 with a production of 6,000 bbls/d and increased production to over 50,000 bbls/d of dry crude (75,000 bbls/d of gross liquids) in less than 24 months.

The company said it was also recognized by NNPC as being one of the two operators with the lowest technical cost per barrel in the industry over that time period. “This performance continued until the wider industry became severely impacted, firstly, by COVID-19, and then, by the unprecedented level of crude theft and sabotage plaguing the Niger Delta area since 2020.”

Also Read: Nigeria Urges UK Court To Overturn P&ID $11bn Judgement Debt

San Leon noted that since Q4, 2021, “the government of Nigeria has received virtually zero crude oil from any company utilising the Nembe Creek Trunk Line, a pipeline that is partially owned by NNPC, owing to the force majeure declared by the NCTL operator and the widespread vandalism and crude oil theft recorded in the region.”

I noted further that the criminal activities in the Niger Delta continued to adversely affect the entire region forcing Eroton’s crude oil receipts to drop steadily in 2021. The situation culminated in zero receipt in November 2021 at Bonny Terminal.

This was despite efficient wellhead production data showing produced volumes of over 500,000 barrels of oil for the same month. Consequently, and in agreement with its partners in OML 18, Eroton shut in the wells.

Eroton was said to have subsequently undertaken alternative means of evacuating its crude oil from OML 18 using barges, a project funded entirely by Eroton and without no financial support from its partners.

Also Read: Seplat Passes Vote Of Confidence On Embattled CEO

Eroton further states that the allegations of improper actions by it are baseless and unfounded and categorically denies any fraudulent acts as stated in the in certain press reports.

San Leon currently holds an initial 10.58% indirect economic interest in OML 18 which is unaffected by the identity of the operator.

By Bosco Agba

Proshare Analysts Rap Incoming Federal Administration On Power Sector Reforms

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As Nigeria’s President-elect, Asiwaju Bola Tinubu, prepares to assume office on May 29, 2023, analysts are saying he must consider the power sector in Nigeria and introduce far reaching reforms.

According to Proshare analysts, the first step first step would be the appointment of a power sector expert or administrator to supervise the sector in the capacity of minister.

The new minister, they said must draw up a National Energy Plan which clearly outlines the Power Sector Expansion plan. “This is necessary to resolve the imbalances between power generation, evacuation, dispatch, and electricity demand,” they said 
According to experts, the provision of adequate gas supply to the existing generation plants is crucial in dealing with the power generation problem.

Also Read: President Buhari Inaugurates Maidugiri Emergency Power Project

Power sector professionals say the transmission end of the value chain, in the hands of the government, must be privatized to bring about greater efficiency and end the incessant problem of load-shedding.

On a second not, the Proshare analysts said likewise, the incoming government must take advantage of mini-grid solutions to increase the amount of electricity generated.

The problem of energy theft at the distribution end of the value chain must be addressed by increasing the number of electricity meters. “This is expected to also bring an end to the notorious estimated billing.”

By Ken Okafor

TotalEnergies’ $20bn LNG Export Facility in Mozambique To Delay For Another 4yrs

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TotalEnergies’ has said that the $20billion LNG export facility it is handling in Mozambique would not start operations until 2027 at the earliest.

This is not withstanding if the French supermajor quickly lifts the force majeure on the works and proceed with development. While on a visit to the construction site in North Eastern Mozambique, TotalEnergi3es project director, Stephanie Le Galles, told Bloomberg, “From the time we restart to production, we need another four years to build the facility.”

According to her, exports from the plant could start “2027 at the best.”
TotalEnergies suspended works on the project in 2021 following Islamist militant attacks in towns close to the site. The project site is close to the town of Palma in the Cabo Delgado province, where Islamic State-affiliated militants have been active for a few years.

Also Read: Africa’s Oil Industry Is Set To Flourish In 2023

In the spring of 2021, Islamic State-affiliated militants raided the town of Palma in attacks that left dozens of people killed. TotalEnergies has yet to decide when to resume the project, with several conditions needed for a positive decision, Le Galles said.

Those include the same project costs, an improved security situation, Mozambique government officials returning to the towns of Palma and Mocimboa da Praia, and an assessment of the human rights conditions in the Cabo Delgado province.

Last month, TotalEnergies CEO Patrick Pouyanné visited Cabo Delgado and entrusted Jean-Christophe Rufin, an expert in humanitarian action and human rights, with an independent mission to assess the humanitarian situation in the province.

Also Read: Natural Gas Prices Could More Than Double In 2024

Saipem, the Italian engineering group, which is a subcontractor for TotalEnergies in the Mozambique project, expects to “gradually restart” work on the project, “according to the information received by our clients, starting from July this year,” Saipem’s CEO Alessandro Puliti said on an earnings call at the end of February.

While insurgents and attacks have stalled TotalEnergies’ project in Mozambique, Italy’s Eni in November started Mozambique’s first LNG exports from the Coral gas field in the ultra-deep waters of the Rovuma Basin.

By Ken Okoye

India Not Bound By EU, America’s Price Cap Sanctions

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India has said that it is not bound by the price cap decisions of the European Union and their Western allies.
Yesterday, a source at the Indian oil ministry told Reuters that the country is it not committed to and is not obligated to buy Russian crude oil only below the $60 price cap of the Western nations.

Russia has been redirecting most of its crude oil exports to China and India since the EU and the G7 announced plans to embargo seaborne oil imports from Russia and set a price cap on the crude if it is to be shipped to third countries using Western tankers and insurers.
India said it does not have any agreement signed with the West to follow the G7 price cap, and therefore not abiding by the G7 price cap as it seeks opportunistic purchases of cheap crude.

Observers however say that the price cap is benefiting the two large Asian oil importers, China and India, with bargaining power to negotiate steep discounts from Russia, with traders covering shipping costs.

Also Read: Russia Insists That Price Cap Against Its Oil Is Not Working

The U.S. and the EU consider the increased leverage of China and India in driving a hard bargain for Russian oil as a success of the price cap policy.

From a negligible buyer of Russia’s oil before the Russian invasion of Ukraine, India has become a key export market for Moscow and is importing record volumes of Russian crude.

Russia supplies at present, around 35% of India’s total oil imports, in stark contrast to less than 1% before the Ukraine war. Based on data provided by consultancy Vortexa, India imported around 1.62 million barrels per day (bpd) in February from Russia—a new record-high.
India will buy the oil it consumes from “wherever we have to” if the economics are beneficial for the country, Indian oil minister, Hardeep Singh Puri, told CNBC last month.

Also Read: Russia May Be Beating Oil Price Cap – Institute

“Today we feel confident that we’ll be able to use our market to source from wherever we have to, from wherever we get beneficial terms,” the minister said.

Seplat Energy Pushes Production In Its ANOH Gas Plant To Q4, 2023

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Seplat Energy has pushed production till fourth quarter [Q4, 2023], with a hint that the completion of the company’s ANOH gas processing plant is being delayed by NNPC Gas Infrastructure Limited (NGIC).

The company said the delay was due to an unnamed third party, which has yet to complete the infrastructure.
The 300 million standard cubic feet per day (MMscfd) ANOH Gas Processing Plant is located in Oil Mining Lease (OML) 53. It has two wells; ANOH-03 & ANOH-04.

Shell Petroleum Development Company of Nigeria (SPDC) made the initial drilling in 2022, “but will not be completed until 2023 due to delays in the gas plant on-stream date,” a statement by the firm in its earnings report discloses.

Seplat has however promised that the third-party infrastructure will be completed in the second quarter (Q2) 2023, and the assurance that the gas output would come in the fourth quarter of this year.

Also Read: Seplat Passes Vote Of Confidence On Embattled CEO

NNPC Gas Infrastructure Limited pipeline network pressure is affecting offtake by Seplat customers downstream of Oben in Edo State after a Horizontal Directional Drilling (HDD) wall collapsed.

According to enbridge, Horizontal Directional Drilling (HDD) is a construction technique whereby a tunnel is drilled under a waterway or other designated area, and a pipeline or other utility is pulled through the drilled underground tunnel.

Last year, Seplat in its 9-month 2022 financial statement disclosed that NGIC, its government partner, was delivering the pipelines that will take the gas from ANOH to Oben, namely the 23km spur line and the Obiafu-Obrikom-Oben (OB3) pipeline.

This was supposed to be completed in the first quarter (Q1) of this year, enabling Seplat to deliver gas from the ANOH plant in the first half (H1), however, the completion timeframe for the infrastructure has been pushed to Q2 and gas deliver from ANOH plant is now projected for the fourth quarter.

Also Read: Court Bars Seplat Energy CEO From Management Activities

Part of the statement reads: “The OB3 pipeline has been affected by the collapsing of the HDD wall in a section of the river crossing. Experts from the UK have been brought in to ‘grout’ the section and grouting will commence in March with the drilling and pipe installation to commence thereafter. NGIC has confirmed that they expect the pipeline to be complete before the end of Q2 2023.”

“Line pipes for the 23km spur line are in country and project completion is almost 70%, with the revised completion date communicated by NGIC as 30 June 2023,” Seplat added.

However, Seplat is not betting its gas delivery on NNPC’s timeframe, “Despite estimated completion for the pipeline infrastructure being Q2 2023, we have further risked the completion dates and have moved the first gas to the final quarter of 2023,” Seplat said.

By Ken Okafor

GPPSL Delivers First AOGV Technology Deployment for LNG Plants in Nigeria/

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The Global Process and Pipeline Services Limited (GPPSL) in partnership with IK-Group of Norway has delivered for the first time in Nigeria and Africa, a 36-inch cryogenic pipeline add on gate valve (AOGV) for Liquefied Natural Gas (LNG) plants.

The project, executed in June 2022, was the first and largest AOGV ever deployed on the African continent to solve long-term stuck valve issue for a major LNG plant.

The AOGV technology is a gate valve that can be assembled in pieces over any live flange pair upstream or downstream of the pipework or equipment requiring intervention.

Also Read: NNPC, NUPRC Differ On Nigeria’s Increased Oil Output Data

The AOGV Mechanical Isolation Tool can create a zero-energy zone where inspection, modification and maintenance work can be performed safely and efficiently whilst production is maintained.

Commenting on the achievement, Managing Director, GPPSL, Mr. Obi Uzu, said the company has saved customers productive time and lowered operating costs through the deployment of the technology.

“Our AOGV success story is a product of GPPSL partnership with IK-Group of Norway. However, our overall competitive advantage comes from being able to source reliable disruptive technology that is suitable for use on large deepwater projects, “he said.
GPPSL is the only Nigerian company focused solely on process and pipeline services with major projects completed in the deep-water applications in its product service line.

Also Read: NCDMB, BOI Launch $50m Fund For Oil Sector Manufacturers

Uzu noted that the company had attracted the best hands in the industry from the multinationals to work for it, with an expansion plan into other West Africa and Sub-Saharan Africa countries.

Thisday