More Boost for Nigeria as Oil Production Rises to 1.6mbpd – Newstrends
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More Boost for Nigeria as Oil Production Rises to 1.6mbpd

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•NNPC shops for new American IOC for Bonga South-west Aparo FID in 2024

•NCDMB to get first dividend payment from Waltersmith Refinery by year end

•Security, cost optimisation, others at front burner as NLNG, IOCs seek solutions

Nigeria is speedily recovering from the months of under-production with oil production at 1.59 million barrels per day as of yesterday, according to the Nigerian National Petroleum Company Limited (NNPC).

The Chief Investment Officer, NNPC Upstream Investments Management Services (NUIMS), Mr. Bala Wunti, who represented the company’s Executive Vice President, Upstream, Mr. Adokiye Tombomieye, disclosed this during a panel session at the ongoing 11th Practical Nigerian Content Forum (PNC) in Uyo, Akwa Ibom State.

Wunti, also said the NNPC and its partners were making significant efforts with corresponding outcomes in the upstream oil sector, revealing that the company was bringing another American oil major to take part in the Bonga Southwest/Aparo Final Investment Decision (FID) billed to take place in 2024.

Also at the forum entitled, “Deepening Nigerian Content Opportunities in the Decade of Gas”, Waltersmith Petroman Oil Limited announced that the NCDMB would get its first dividend payment from its 5000 barrels per day modular refinery in Imo State by the end of the current financial year.

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However, issues bothering on challenges of the nation’s oil and gas industry including insecurity, high operational costs, enabling fiscal policies and other such bottlenecks were at front burner as the Nigeria Liquefied Natural Gas (NLNG) Limited, Shell, TotalEnergies and Chevron unanimously canvassed the need to address those problems to drive investments in the gas sector.

Speaking during the panel, which was on “Defining the Requisite Roadmap for Increased Gas Production,” Wunti said the achievement of the 1.59bpd production yesterday was resulted from the collaboration between the NNPC, its partners, the private security contractors and other stakeholders in the industry.

He said that meant that a significant quantity of the lost production volume had been recovered, adding that it represented an average of about 250,000 barrels over the last six months.

Wunti said, “I like talking about outcome and matching the outcomes with the efforts. We do know that in January, our budget is 1.8 million barrels per day.

“I’m sure His Excellency has not been getting the money that he should get from the treasury because the budget was anchored on 1.8 million barrels.

“It degenerated somewhere in July, August to about one million barrels. I’m glad to say, with the collaboration of every one of us and the private security contractor that we put in place, our production today is about 1.59 million barrels this morning. That means we have recovered significant quantity.

“On the average, about 250,000 barrels over the last six months, but on a snapshot, we have seen the 400,000 barrels increase that was deferred earlier as a result of significantly either stealing or as a result of our inability to produce as a result of environmental reasons and some other reasons.”

He, however, revealed that the company was bringing another American oil major to take part in the Bonga Southwest/Aparo Final Investment Decision (FID) billed to take place in 2024.

Bonga Southwest/Aparo is a conventional oil development located in deepwater in Nigeria and is operated by Shell Nigeria Exploration and Production Company Limited.

Discovered in 2001, Bonga Southwest/Aparo lies in block Oil Mining Licence (OMLs 118, 140 and 132, with water depth of around 4,395 feet.

The project is currently in approval stage and was expected to start commercial production in 2026. The FID of the project was to be approved in 2022 and the development of the asset would involve the drilling of approximately 24 wells and includes Floating Production, Storage and Offloading (FPSO) and subsea trees.

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Production from the project was expected to begin in 2026 and was forecast to peak in 2027, to approximately 146,765 bpd of crude oil and condensate and 157 Mmcfd of natural gas. Based on economic assumptions, the production would continue until the field reaches its economic limit in 2059.

Also, the field was expected to recover 759.56 million barrels of oil equivalent (Mmboe), comprised of 644.86mbbl of crude oil and condensate and 688.17bcf of natural gas reserves.

The field is owned by Shell, Eni, TotalEnergies, Chevron, Exxon Mobil and Luke Oil.

“I did mention that we’re going for FID on Bonga North either last quarter of this year or first quarter next year. I did mention that Bonga South-west is going to sleep, we’re going to focus on 2024. We’re aligning with all our partners to focus on doing Bonga South-west/Aparo.

“We’re bringing one American more to make it for Aparo. So we’re targeting the FID in 2024. Several other projects with Chevron, we hope to do the FID before the end of first quarter of 2023 – the Agbami Gas Project. All these are coming with significant gaseous hydrocarbon,” he noted.

He said the current improvement in electricity supply was a result of the security architecture, which has enabled the generation of additional 500 million standard cubic feet (scuf) of gas, assuring that the NNPC would be sending additional 250 million scuf to NLNG and 250 million scuf to the domestic market.

“That increase is making Egbin and all the other power plants around Lagos very stable. And we’re making sure that all the efforts we make we can measure them. I was very excited when I saw Simbi putting the outcome versus the input. So in upstream today, we don’t look at only the input and the output, but we go all along to capture and commend the outcome”, Wunti added.

Delivering the sponsor’s keynote address, the Chairman of the Independent Petroleum Producers Group (IPPG) and Waltersmith Petroman Oil Limited, Mr. Abdulrazaq Isa, announced that the NCDMB, which is an investor in the 5000 barrels per day Waltersmith modular refinery would be receiving its first dividend by the end of the 2022 financial year.

According to Isa, “After just 27 months of operations, NCDMB will receive its first dividend payment from the refinery for this financial year. We also forecast that by Q2 2023, the refinery will have paid off all its debt and commenced installation of another module of 5000 bpd.

“The Waltersmith Refinery which was enabled by NCDMB has been phenomenally successful.”

Isa also stated that the Minister of State for Petroleum Resources, Chief Timipre Sylva, had been instrumental in driving the Decade of Gas policy, which aims to unlock over three billion cubic feet of gas per day.

He added that this would create significant benefits for Nigeria by attracting Foreign Direct Investments (FDIs) in excess of $10 billion in addition to creation of millions of jobs across the gas value chain.

He posited that unlocking this gas potential within the decade would certainly involve big gas development projects, where the local content successes recorded on similar projects could be replicated.

He said the commitment of funds under the NCDMB’s commercial ventures partnership programme continues to stimulate investment and promote in-country capacity, adding that it was imperative that the role NCDMB had played through strategic investments and as a business catalyst on impactful projects were highlighted.

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Isa maintained that the Waltersmith refinery was a notable example of efforts of the NCDMB to promote local content through active financial participation in businesses that have huge local values.

He disclosed that the refinery has enhanced value-add from the industry by increasing local refining capacity, creating employment opportunities, and delivering diesel, kerosene, naphtha and High Fuel Oil (HFO) into the domestic market.

In his remarks, the Executive Secretary of NCDMB, Mr. Simbi Wabote, revealed that the board has achieved 54 per cent local content retention level in the Nigerian oil and gas industry in 2022.

According to him, the push for Nigerian Content as envisaged in the agency’s 10-year Strategic Roadmap has continued to yield results in the last five years, pointing out that out of the 96 initiatives under the strategic roadmap, NCDMB has completed 77.

“It is my pleasure to announce that the 2022 Nigerian Content level in the Nigerian oil and gas industry is 54 per cent based on our monitoring and evaluation of industry activities which bring the average in the last five years to 44 per cent Nigerian Content level.

“Once again, this performance is well above the minimum target of 42 per cent NC set for 2022 by the Board’s Project Management Office (PMO) just like we outperformed the 38 per cent NC target set for 2021 by achieving 42 per cent Nigerian Content.”

He listed the top-three performers of in-country spend in 2022 as Fabrication and Construction at 99 per cent NC, Manpower at 81 per cent NC, and Project Management at 80 per cent NC, while the bottom-3 performers were Procurement at 34 per cent NC, Engineering at 46 per cent NC, and Services at 50 per cent NC.

He noted that the Practical Nigerian Content Forum was a flagship event of the Board which attracts major stakeholders in the oil and gas industry from across Nigeria.

“The event serves as an opportunity to showcase the practical investment opportunities and achievements by NCDMB in the Nigerian oil and gas industry and its linkage sectors.

“It also hosts senior government officials, heads of International and Indigenous Oil Companies, and exhibitions of industry products and services in the upcoming event.”

However, in their separate interventions during the panel session moderated by the pioneer Executive Secretary of NCDMB, Dr. Ernest Nwapa, the Chairman of Shell Companies in Nigeria and Managing Director of Shell Petroleum Development Company Limited (SPDC), Mr. Osagie Okunbor; Managing Director of TotalEnergies Upstream Nigeria Limited, Mr. Mike Sangster; Managing Director of Chevron Nigeria Limited, Mr. Rick Kennedy; and Deputy Managing Director of NLNG, Mr. Olalekan Ogunleye, harped on the need to address the challenges confronting operators in the nation’s oil and gas industry.

They listed such issues as insecurity, high operational costs, unfavourable fiscal policies and other such bottlenecks that make Investments in the industry especially achieving the Decade of Gad agenda difficult.

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Release Nigerian traders’ data to EFCC, court orders Binance

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Release Nigerian traders data to EFCC, court orders Binance

 

A Federal High Court in Abuja has ordered Binance Holdings Limited, a cryptocurrency exchange platform, to furnish the Economic and Financial Crimes Commission with the comprehensive data of all persons from Nigeria trading on its platform.

Justice Emeka Nwite granted the interim order after ruling on the ex-parte motion moved by the EFCC’s lawyer, Ekele Iheanacho.

This was granted to enable the anti-graft agency to unravel the alleged money laundering and terrorism financing on Binance.

The ex-parte motion was brought pursuant to Sections 6(b), (h), (I), 7(1), (a)(2), and 38 of the Economic and Financial Crimes Establishment Act, 2004 and Section 15 of the Money Laundering (Prevention and Prohibition) Act, 2022 (as amended) and the inherent powers of the court.

An operative of the EFCC, Hamma Bello, in an affidavit he deposed to, said the matter was of utmost urgent public interest.

He said the data provided would enable the commission to accomplish its investigation activities.

He said it was in the interest of justice to grant the application as refusal of the request would largely hamper the commission’s investigation.

He stated, “That the team uncovered users who have been using the platform for price discovery, confirmation and market manipulation which has caused tremendous distortions in the market, resulting in the naira losing its values against other currencies.

“That the damage the platform has caused was clearly explained to the operators of the platform and they were requested to delist the Naira and avail the ONSA on the activities of the Nigerians on their platform,”

He said the information availed to the team by Binance shows that the total trading volume from Nigeria in 2023 alone stood at $21.6 billion.

Binance is a cryptocurrency exchange that lists more than 350 cryptocurrencies globally.

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UK firm to build PH-Enugu-Abuja standard rail line – FG

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UK firm to build PH-Enugu-Abuja standard rail line – FG

The Federal Government has signed a Memorandum of Understanding with Messrs MPH Rail Development Limited, a United Kingdom company for the construction of the Port Harcourt–Enugu–Calabar–Abuja Standard Gauge Rail Line.

The project when completed will be operated under a public-private partnership framework.

These details are contained in a statement issued by the Federal Ministry of Transportation and published on its website.

Under the MoU, the UK firm will manage the design, construction, commissioning, operation and eventually transfer to the Nigerian Railway Corporation.

The ministry stated that the MoU signing followed the approval of the Outline Business Case and the issuance of a compliance certificate by the Infrastructure, Concession, and Regulatory Commission.

This clearance allows Messrs MPH Rail Development (UK) Limited to focus on assembling the necessary documents for the Federal Executive Council (FEC) approval to proceed with the project.

Some of the essential documents for advancing this initiative are listed as a comprehensive feasibility study report, a full Business Case Study, an Environmental and Social Impact Assessment, the production of a Resettlement Action Plan, and the design of a Financial Model to implement the project.

This would ensure transfer of the line to the Federal Government under a PPP arrangement without incurring loans or debts for the Nigerian government or its agencies.

At the MoU signing ceremony, Alkali pledged the ministry’s support for the successful implementation of the project.

He emphasized the importance of diligent preparation and submission of all requisite documents to expedite FEC’s approval.

The statement read in part, “As part of the initiative to consolidate the ongoing railway modernisation projects consistent with the Renewed Hope Agenda of Presidential Bola Ahmed Tinubu administration, the Minister of Transportation, Senator Saidu Ahmed Alkali, has executed a Memorandum of Understanding on behalf of the Federal Ministry of Transportation with Messrs MPH Rail Development (UK) Limited to enable the company to carry out the design, construction, commissioning, operation and transfer of the Port Harcourt–Enugu–Calabar–Abuja Standard Gauge Rail Line on Public – Private Partnership basis.”

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No approvals from FEC for borrowing through eurobond, says DMO

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No approvals from FEC for borrowing through eurobond, says DMO

The Debt Management Office (DMO) says it has not secured approval of the Federal Executive Council for the appointment of advisers and eurobond issuance.

The Federal Government could raise as much as $1 billion in external borrowing in 2024 through this method to meet its spending needs.

On March 13, there were reports Nigeria had hired investment banks to seek advice on its first eurobond issue since 2022.

But the DMO in a statement on Friday said it had not appointed transaction advisers.

“The appointment of Transaction Advisers by the DMO is done in accordance with the provisions of the Public Procurement Act, 2007 and is subject to the approval of the Federal Executive Council (FEC),” DMO said.

“Also, the Issuance of Eurobonds by the Federal Government of Nigeria in the International Capital Market is subject to the approval of the FEC and receipt of the Resolution of the National Assembly (NASS) in accordance with the provisions of the Fiscal Responsibilities Act, 2007 and Debt Management Office (Establishment, Etc.) Act, 2003.

“Currently, the DMO has not received the requisite approvals from the FEC and Resolution of the NASS for any Eurobond Issuance.”

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