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The much talked about bidding round for marginal fields initially proposed for the first quarter in 2013 by the Minister of Petroleum Resources, Mrs Diezani Alison-Madueke is looking increasingly unlikely this quarter. NOGintelligence gathers that it may no longer be possible in view of the fact that several targets for the rounds set by the Ministry have not been met.

The industry regulator, the Department of Petroleum Resources (DPR), responsible for administering the bidding round has confirmed the development as it stated recently that the full guidelines for the process were still being awaited.

Although, it was earlier reported that the DPR had compiled the number of oil blocks open for bidding and was waiting for the Ministry of Petroleum to formulate a roadmap, a source from the agency recently informed NOGintelligence that there is nothing concrete yet on this as the Federal Government is yet to advertise the guidelines for the bidding process to show its readiness.

The source who pleaded anonymity said: "We can't hide anything about the bid round. If the guidelines are ready, they will be advertised by the Federal Government. The reason you have not seen the advertorial is probably because it is still in the process."

Meanwhile, data obtained from the DPR indicates that the total number of oil blocks in the country including oil Prospecting Leases (OPL) and Oil Mining Lease (OML) is 388.Those already awarded are 173 while those open are 215 in number. The fields currently in production are 218 while those not producing totalled 97.

Additionally, it has been revealed that the uncertainty over the passage of the all-important Petroleum Industry Bill (PIB) could be partly responsible for the delay. Analysts believe that it will be difficult to hold a successful bidding round until the passage of the Bill. It is hard, they say, to see how investors will put up their best bids when they do not know what fiscal obligations will apply to their production. Some say that even if the bidding round is conducted successfully, most winners are unlikely to start work on their blocks before the PIB is passed, leading to a delay in commencing operations.  

The delay in passing the PIB has cost the country billions of dollars in potential investment in the industry, particularly from foreign investors.  Whatever happens, it is clear that the PIB must be passed as quickly as possible as it is key to unlocking much needed investment to the industry which will also give the marginal field round a great boost.

Luxembourg-based Subsea 7 SA has been awarded a contract for the development of Erha North deepwater field in Nigeria by Esso Exploration and Production Nigeria Limited (EEPNL), a subsidiary of ExxonMobil.  Subsea 7 said in statement that the new contract, which will be executed in water depths of between 1,000metres and 1,200metres, was awarded to a consortium of West African Ventures Limited and Subsea 7's Nigerian subsidiary.

"Subsea 7's scope of work includes the engineering, procurement, fabrication and installation of 25 kilometres of flowlines, 15 kilometres of umbilicals, and seventeen rigid jumpers. The scope also includes modifications to the FPSO in order to integrate it with the new subsea facilities," the statement said.  

The statement also disclosed that the project would maximise the use of local personnel and resources in Nigeria, adding that significant parts of the design would be executed in Nigeria, while all subsea structures would also be fabricated in the country.  

 "Engineering will commence immediately with offshore installation scheduled to commence in early 2015, using the Seven Borealis and the Seven Pacific," said Subsea 7's statement.

Commenting on the contract, Subsea 7's Senior Vice-President for Africa and Gulf of Mexico, Mr. Olivier Carre said: "We are delighted to be awarded this contract which demonstrates our partners' confidence in our capabilities, and underlines our ability to leverage local skills and assets when developing technological solutions for deepwater subsea construction. This substantial contract award further expands our already strong presence in West Africa."

Subsea 7 is a seabed-to-surface engineering, construction and services contractor to the offshore oil and gas industry worldwide.

The Erha and Erha North projects consist of 32 subsea wells tied back to a Floating Production, Storage, and Offloading vessel (FPSO). The Erha North project had been stalled for several years due to the inability of NNPC and its international oil company partners to reach an agreement on their costs.

The field was converted from OPL 209 to OML 133 in March 2006 after it came on stream. Nigerian National Petroleum Corporation (NNPC) remains the licence holder while EEPNL and its co-venturer, Shell Nigeria Exploration and Production Company Limited (SNEPCO) are NNPC's production sharing partners in the block.

Shoreline, the local partners of Heritage Oil in the acquisition of a stake OML 30, has come to the defence of its foreign partners. The Chief Executive of Heritage, Tony Buckingham, had been labelled a security threat due to his intersting past as a "security consultant" in Africa.  

Kola Karim, the Manager Director of Shoreline, refutes the allegations that Buckingham is a security threat. According to him, Heritage has over 8,000 shareholders of which 50 per cent are institutional investors and the firm is listed on the main board of the London Stock Exchange. In his robust defence of Buckingham, he said: "It is very clear to get the message to the Nigerian public that we have a formidable first class international company which is well recognised in finding and working well anywhere in Africa and anywhere in the world."

Karim said that Shoreline won the bid for the combined Shell/Agip/Total 45% stake in the block through a transparent and open process. Heritage owns a 45% share of Shoreline.  

Shedding some light on the acquisition process, Karim said that Conoil in fact won the bid but decided to withdraw from the process after it became clear that the operatorship of the block would revert to the Nigerian Petroleum Development Company (SPDC)(the exploration and production arm of the national oil company, Nigerian National Petroleum Corporation). Shoreline was a preferred bidder in the process and after Conoil pulled out, they were informed some 9 months later that they were second in line and could therefore take Conoil's place.  

The decision of SPDC to assume the operatorship of the asset had caused many of the divestment of assets by the International Oil Companies to stall while the terms of such operatorship were negotiated. For many investors, the assumption of operatorship by SPDC came as a surprise as it had been widely assumed the purchaser of the asset would take over the operatorship. In spite of this obstacle the divestments have proceeded to conclusion with the parties coming to various arrangements, some of which include the integrated services of project managers that meet with the approval of the purchasers.

A subsidiary of the Dangote Group, Borkir International Limited, has started a multi billion naira project aimed at converting vehicles for the use of Compressed Natural Gas (CNG) as fuel, as against premium motor spirit (petrol) and automotive gas oil (diesel) commonly used by motorists.

The company said it intends to convert 5000 trucks to CNG from diesel.At present, Nigerians are said to be paying more for diesel than anywhere else.A litre of diesel sells for between N150 and N160 per litre.The gas for fuel initiative will see haulage trucks paying much less for fuel which could have a knock on effect on commodity prices.

The company said it has acquired conversion kits for converting 1000 trucks in Lagos where the project will take off. It has plans to build CNG filling stations across the country, starting with the Lagos-Abuja route, in order to ensure easy accessibility of the product by truck drivers.

The company expects to put the first batch of converted trucks into operation later this year.

Forte Oil Plc, an indigenous petroleum marketing company owned by Femi Otedola, has announced the listing of its petrol stations around the country on Google Maps. This means that its customers will be able to find its 36 Forte Oil petrol stations located around the country simply by typing Forte Oil into the Google Maps site www.maps.google.com.ng.

Speaking on the listing, Akin Akinfemiwa, GCEO of Forte oil plc said; ''Technology is a major part of our business transformation strategy; we use technology to constantly improve customer access of our products and services nationwide; partnering with Google is a welcomed initiative not just because Google is synonymous with search internationally, but also because it aligns well with our vision of being a technology driven organisation".

Speaking on the partnership, the country Head for Google Nigeria, Julie Ehimuan said: "Google has various solutions tailored to the needs of  both small and large businesses, accessibility continues to be a primary requirement of any business, which is why we are happy to help improve Forte Oil's accessibility  to its customers''

Forte Oil says it prides itself on structuring its operations and strategic policies to continuously improve product delivery to its customers. The Google Maps listing is a step in the implementation of that strategy.

Oando PLC has announced the extension of the acceptance period for its 4.5 billion shares rights issue to Wednesday 20th February.

Shareholders were advised in a statement by the company that due to an industrial action by pensioners of the Nigerian Postal Service in January 2013, resulting in the disruption of distribution of Rights Circulars to the majority of Oando's shareholders, the Nigerian Securities & Exchange Commission has approved a two-week extension of the Acceptance period.  

Accordingly, the Acceptance period of the Rights Issue will now close on Wednesday, 20 February 2013. Oando's is offering 4,548,236,276 ordinary shares of 50 kobo each at N12.00 per share. The rights issue is widely believed to be partially used for the funding of its acquisition of the ConocoPhilips assets in Nigeria.

Acceptance/ renunciation forms are available from the registrars, First Registrars Nigeria Ltd; the lead issuing house, Vetiva Capital Management; and the joint issuing houses, FBN Capital and FCMB Capital Markets.

United States oil giant,Chevron Corporation has reported earnings of $7.2 billion for the fourth quarter 2012, compared with $5.1 billion in the 2011 fourth quarter.  

Results in the 2012 period included a gain of $1.4 billion from an upstream asset exchange, with production increases from project ramp-ups in Nigeria and Thailand. The company's full-year 2012 earnings were $26.2 billion, down 3 per cent from $26.9 billion recorded in 2011.  

Sales and other operating revenues in the fourth quarter 2012 were $56 billion, down from $58 billion in the year-ago period, mainly due to lower crude oil volumes.     

The Chairman and Chief Executive Officer of the company, Mr. John Watson said his company had delivered another very strong year in 2012. "Our upstream portfolio continues to produce excellent results. We've now led the industry in earnings per barrel for over three years," he said.

The Nigerian National Petroleum Corporation (NNPC) appears set to do battle with the Nigeria Extractive Industry Transparency Initiative (NEITI) over NEITI's allegation that the national oil company illegally paid itself the sum of N1.4 trillion between 2009 and 2011 in petrol subsidy, NOGintelligence has gathered.

NOGintelligence's investigations revealed officials at NNPC and the Ministry of Petroleum are fuming over what an NNPC source referred to as "NEITI's continuous embarrassment of the Federal Government with its audit reports." According to NNPC sources, NEITI's reports are aimed at ridiculing the President Goodluck Jonathan-led administration and making a mockery of its anti-corruption efforts.

NEITI's latest audit report released last week showed that NNPC owed the Federation Account a whopping N1.3 trillion after subsidy claims by NNPC grew astronomically within the three years under review.

The report also accused the NNPC of using exchange rates lower than what was obtainable at the Central Bank of Nigeria (CBN) in its transactions. According to NEITI the foreign exchange process used by NNPC led to the loss of N98.3billion by the Federal Government between 2009 and 2011.  

"The financial report clearly underlines that contrary to the practice where subsidy payments are claimed from the Petroleum Support Fund through the Petroleum Products and Pricing Regulatory Agency by the qualifying oil marketing companies, the NNPC draws subsidy payments directly from domestic crude sales proceeds before remittances to the Federation Account. As a result, a sum of N1.4 trillion was claimed during the period by the NNPC as oil subsidy payments. Subsidy payments claimed by the NNPC increased by 110 per cent. For example, it rose from N198billion in 2009 to N416billion in 2010. In 2011 alone, it rose to N786billion. The increase between 2009 and 2011 alone was 186 per cent," said the Chairman of NEITI, Ledum Mitee whilst presenting the report.

He added that NEITI was currently carrying out further validations on subsidy payments for its physical and process audit, results of which are expected to be released in March. He said that the validation exercises would include other marketers.

But in a swift reaction, the NNPC described the contents of the audit report as misleading, saying that NEITI has continued to embarrass it in the eyes of the Nigerian public without precise knowledge of its operations.  

NNPC released a strong statement strenuously denying the accusations. The statement acknowledged that it had received the draft report but was still reviewing its contents to reconcile the differences when NEITI released the report to the public.  

 "The NEITI draft report was made available to NNPC on 17 January, 2013 and the corporation was in the process of reviewing same for reconciliation when it was hurriedly made public and released to the press," NNPC stated.

"Standard audit procedure requires close-out between the auditor and the auditee before it is finalised and put in the public domain. The report contains fundamental inaccuracies, which are misleading and constitutes misinformation to the generality of the public," NNPC added.

On the subsidy payments, NNPC explained: "On the total amount of N1.4 trillion deducted, the report deliberately ignored and or omitted the factors responsible for the increasing amounts paid especially the price of crude oil which accounts for 82 per cent of the price build-up for petroleum products. Other factors include increase in volumes consumed, variations in exchange rates and increase in freight rates especially in 2011."  

NNPC further stated that having concluded its review of the draft NEITI report, it was awaiting a formal engagement with the organisation to close out the report.

The Nigerian Extractive Industry Transparency Initiative (NEITI) has vowed to sanction Neconde Energy Limited, Septa Energy Limited, Energia Limited and Emerald Energy Resources for alleged under-reporting of the quantity of crude oil they produced between 2009 and 2011. Whilst presenting the highlights of the report, the Chairman of NEITI, Mr Ledum Mitee, said that under-reporting by these companies led to an under-assessment of $2.65 billion for petroleum profits tax (PPT) although a total of $442 million had been recovered. He complained the affected companies had refused to cooperate with NEITI.  

The companies are said to be threatening to take legal action against NEITI over the allegations contained in the report.

NEITI is the national version of the Extractive Industries Transparency Initiative (EITI), which is a global movement aimed at ensuring that extractive resources aid sustainable development. It was inaugurated in February 2004 by former President Olusegun Obasanjo when he set up the National Stakeholders Working Group (NSWG) under the leadership of Mrs Obiageli Ezekwesili.

Mitee said the agency was determined to use the powers given to it by the enabling Act to sanction the companies.

In a move to stave off the growing impatience of Amnesty Programme delegates, the presidency has released a statement to explain the reason for the delay in the payment of stipends and allowances to the delegates.  

The Special Adviser to the President on the Niger Delta, Hon. Kingsley Kuku, said in the statement that the delay in the payment to the former agitators was due to the fact that the 2013 budget is yet to be signed into law. Consequently, he said, the Amnesty Office had not received its allocation for the payment of its stipends and allowances for the month of January 2013.  

He assured the delegates that efforts are ongoing to secure funds from the Federal Ministry of Finance. He said that the situation was regrettable but that the payment of stipends and allowances would be made immediately the funds are released.

The Presidency is very keen to ensure that nothing destabilises the amnesty, which saw peace restored to the troubled Niger Delta region in 2009. There were fears that there could be reprisals from ex-militants following the conviction of the Nigerian war lord, Henry Okah in a South African court for two car bombings in Nigeria in 2010. There have also been threats by the former militants to return to the creeks after calling for the removal of the Minister of Petroleum Resources,

However, the programme has recorded many successes and only last week NOGintelligence reported that 64 ex-fighters had been certified after undergoing a six-month course in marine diving at the Nigeria Naval Under Water Warfare School in Lagos. 

One of the more high profile EFCC prosecutions suffered a setback on Wednesday after one of its main witnesses failed to identify the defendants in the case. The prosecution of Mamman Nasir Alli, the son of the former Peoples Democratic Party Chairman, Ahmadu Alli, has attracted much publicity. Alli and two others, together with his company, Nasaman Oil and Gas are in court over a N4.4 billion alleged petrol subsidy scam. They are accused of falsely obtaining the sum from the Petroleum Support Fund for the purported importation of 30.5 million litres of petrol. However, in a hearing before Justice Adeniyi Onigbanjo at the Ikeja High Court, the witness, Victor Sanusi, a member of staff of the Petroleum Products Price Regulatory Agency said that other than the company, he did not know the defendants.

Many have been sceptical of the chances of successful prosecutions of the subsidy suspects who have amassed so much wealth from the fuel subsidy payments. The EFCC however appears determined in their effort to see that the prosecutions are carried out successfully. 

The trial continues.

Addax Petroleum Development (Nigerian) Limited invites interested and pre-qualified contractors to respond to the opportunity for the supply rig support services in its 124. The contract is proposed to commence on Q3 of 2013 and will continue for 2 years, with the option to extend for a further year. The scope of services include: Casing and Tubular Running; Fishing; Drilling Tools Rental; Drilling, Completion Fluids and Mud Engineering; Surface Testing; Cement and Cementing; MWD/LWD/DD; Mud Logging; Solid Control; Wireline; Slickline; Downhole Testing; Coil tubing and Nitrogen Services; Gyro; Surface Wellhead Equipment and Xmas Trees; Welding Habitat; Completion - Cased Hold and Liner Hanger; Completion - Standalone and Expandable Sand Screen; Gravel Packing; and Coring.

Only tenderers who are registered with the required NJQS Product/Category shall be invited to submit technical bids. The closing date for this opportunity is 12.00 hours on 28th February 2013.

Chevron Nigeria Limited, operator of the NNPC/Chevron Joint Venture invites interested and prequalified companies for the tender opportunity for the provision of Downhole Permanent Guages (onshore). Only those registered with NJQS Product/Category 1.01.08 (Production Well Test and Monitoring Instruments) shall be invited to submit a technical bid. The closing date for this opportunity is 4pm on 20 February 2013.

Chevron Nigeria Limited, operator of the NNPC/Chevron Joint Venture invites interested and prequalified companies for the tender opportunity for the provision of Expandable Sandscreens (offshore). Only those registered with NJQS Product/Category 3.04.21 (Well Completions) shall be invited to submit a technical bid. The closing date for this opportunity is 4pm on 20 February 2013. 

Chevron Nigeria Limited, operator of the NNPC/Chevron Joint Venture invites interested and prequalified companies for the tender opportunity for the provision of Mud Logging Services (onshore). The services shall consist of complete Formulation Evaluation and Advanced Drilling Technology (ADT) Services as required for Mud Logging operations in vertical, highly deviated or horizontal wells and inclusive of real time transmissions to the company's Lagos, Escravos and Port Harcourt bases. Only those registered with NJQS Product/Category 3.04.07 (Mud Logging) shall be invited to submit a technical bid. The closing date for this opportunity is 4pm on 21 February 2013. 

Esso Exploration and Production Nigeria Limited, contractor of the NNPC/EEPNL Production Sharing Contract plans to engage the services of competent contractors for the provision of FPSO System Integrity Inspection Services on its Erha FPSO within the NNPC OML 133 acreage for an anticipated contract term of two years with one year optional renewal period. The contract is expected to commence in 2013. Only tenderers who are registered with the Other Inspection Services (3.07.98) and Non-Destructive Testing (NDT) Services (3.07.01) NJQS Product Categories shall be invited to submit technical bids. The closing date for this opportunity is Wednesday 20 February 2013.