Click to read
Email us to order print copy giving your name, company name and full address. |
|
|
|
|
Welcome to our 87th issue.
|
DPR Director Calls for Urgent Exploration as Oil Reserves Drop to 35 Billion Barrels
Nigeria's oil reserves are continuing to drop at an alarming rate. Speaking at the Nigeria Oil and Gas conference in Abuja, the Director of the Department of Petroleum Resources (DPR), George Osahon, revealed that Nigeria's oil reserves have dropped from 40 billion to 35 billion barrels.
Osahon said the situation was due to the reduction in oil production in Nigeria. He explained that as oil wells are depleting assets, production will stop once the wells attain maturity. That is the stage at which many Niger Delta oil wells are currently.
Osahon is calling for urgent exploration to boost the nation's dwindling oil reserves. He said that there is a need for a vigorous exploration programme to shore up reserves.
The DPR Director who is worried about the situation, said: "We need to do more in this regard so as to have more reserves. We have reached the plateau of production in the Niger Delta and we are already going down."
Osahon is nonetheless optimistic about the long-term position, saying: "We are optimistic about this. We have come up with strategies to boost our reserves and in due course, we would make this known."
Not everyone shares his optimism however as analysts point to the withdrawal of the international oil companies (IOCs) from the onshore area, as a result of which there has been a decline in exploration onshore. The IOCs say they want to concentrate their efforts in the deep offshore area, but while they wait to see what happens with the Petroleum Industry Bill (PIB) they are not making any new final investment decision. As a result, very little exploration is taking place offshore as well.
To make matters worse, global analysts, IHS Energy, say drilling success rates are declining in areas of water depths of 200 metres or more. They say the average drilling success rates in such water depths have declined from 70 per cent for the period from 1995 to 2004 down to 28 per cent for the period from 2005 to 2013.
Meanwhile, indigenous companies who are rushing to scoop up the divested assets are not able to find the funding for new exploration projects. Most investors are looking for low hanging fruit in the prolific Niger Delta and will not take the chance on an exploration asset, preferring instead to go for assets that have been developed to near production. As a result there is very little exploration going on and there are so few new discoveries that reserves are continuing to dwindle leaving service providers to the industry frustrated by the stagnation in the industry.
Many will be waiting anxiously for Osahon's strategies to be implemented and hoping it will be enough to give the industry the shot in the arm it needs. Only a dramatic intervention will be sufficient to make the impact needed to increase reserves and revive and revitalise the industry.
Osahon says he expects the strategies to include seismic data coverage, drilling of exploration wells and enhanced recovery methods.
Back to top
|
Pentair Valves & Controls Expands into Nigeria
Leading manufacturer of valves, actuators and controls for the oil and gas industry, Pentair Valves & Controls, has expanded its presence into Nigeria with a new distribution agreement with indigenous company Plant Engineering Nigerian (PEN). The company is excited by the enlargement of its emerging markets footprints and hopes that the new partnership will provide customers with local service for Pentair's safety relief valve technology in the Nigerian oil & gas market.
Pentair says it identified Nigeria as a target location for its rapid growth potential. The company says the partnership will bring together Pentair's global installed base with PEN's expertise in the oil & gas industry through its facilities in Port-Harcourt, Lagos and its US office in Houston.
Plant Engineering was formed in February 2009. The company provides global supply chain and project management services in metering systems, valves & controls and mechanical systems.
Frido Langedijk, VP Sales & Commercial Services for Europe, India & Africa at Pentair Valves & Controls commented: "We have been working on this distribution agreement for a year and we're very pleased to establish our relationship with PEN."
"Combining our global expertise and supply chain with local service and experienced partners enables us to meet our customers' needs more effectively and grow our business through new commercial opportunities. Providing this type of service ensures we bring market leading initiatives to our key sectors in oil & gas, process engineering, mining and power, and enhance our customers' operations through our value added approach," Langedjk continued.
"Emerging markets, such as the MINT (Mexico, Indonesia, Nigeria and Turkey) territories, are a vital part of our growth strategy," he stressed.
PEN will begin servicing Pentair's safety relief valve installed base in the coming months.
Back to top
|
Petrol Crisis Eases Once Again
Independent Petroleum Marketers Association of Nigeria (IPMAN) has come to the rescue after another difficult week of petrol shortage and fuel queues in Lagos and Abuja and surrounding areas. The marketers have reported a delivery of 197 truckloads of Premium Motor Spirit (PMS) to the two major cities bringing hope to long-suffering residents of an end to the recent disruptions.
The Association is determined to see the back of petrol queues and has threatened to penalise any of its members found to be hoarding petroleum products. They plan to have a joint task force made up of their members and NNPC staff to monitor petrol stations in the two cities to ensure there is no hoarding of petroleum products.
He added: "l want to confirm to Nigerians and marketers that with the level of petrol injected into the western zone by the NNPC, there is no cause for panic buying and hoarding petrol."
Most residents of Abuja and Lagos who have heard that before will be wondering when a permanent solution to petrol scarcity issues will be found.
|
Galp Energia Sells NLNG Cargo to Petronas
Portuguese oil company Galp Energia has sold 18 of the 30 Liquefied Natural Gas (LNG) cargoes it won from the Nigeria Liquefied Natural Gas Company (NLNG). The buyer of the cargoes it has sold so far is Malaysia's Petronas. Galp Energia is engaged in the exploration, production, refining and distribution of oil, petroleum products, and natural gas. The company recently tendered for up to 30 LNG cargoes over a period of 5 years from NLNG, which it was awarded. Under the terms of the award, it will receive between 4-6 cargoes every year.
Galp's deal with Petronas means it has managed to re-sell the cargo for 3 of the 5 years. This translates to about 18 cargoes of the 30 it is getting from NLNG.
Galp Energia's two refineries in Portugal together account for 88% of Portugal's annual petroleum product needs. The company also has interests in Latin America where it has oil and natural gas exploration and refining operations in Uruguay, Venezuela and Brazil. In 2011, the company sold a 30% stake of its exploratory asset portfolio in Brazil to China's Sinopec.
Petronas has itself been involved in exploration in Nigeria but the project was abandoned in 2006. Despite attempts by both countries to improve bilateral trade, Petronas has so far not been tempted back to invest in Nigeria's upstream sector of the oil industry. Trade between the two countries has been dropping steadily over the last few years and Nigeria has said it is keen to see Petronas make a come back. News of the purchase of the LNG cargoes is an encouraging sign that Petronas could yet return.
|
OPEC Daily Basket Price Stood at $102.37 a Barrel Thursday, 20 March 2014
The price of OPEC basket of twelve crudes stood at $102.37 a barrel on Thursday, compared with $103.16 the previous day, according to OPEC Secretariat calculations.
Introduced on 16 June 2005, is currently made up of the following: Saharan Blend (Algeria), Girassol (Angola), Oriente (Ecuador), Iran Heavy (Islamic Republic of Iran), Basra Light (Iraq), Kuwait Export (Kuwait), Es Sider (Libya), Bonny Light (Nigeria), Qatar Marine (Qatar), Arab Light (Saudi Arabia), Murban (UAE) and Merey (Venezuela).
|
NNPC GED Abiye Membere Sacked
President Goodluck Jonathan has sacked Group Executive Director (GED), Exploration and Production, of the Nigerian National Petroleum Corporation (NNPC), Abiye Membere. The President also used the opportunity to fill four existing vacancies on the NNPC board. The sacking of Membere has raised eyebrows, not least because of the suddenness with which it was announced.
Membere had just given a robust speech at the CWC's Nigeria Oil and Gas Conference in Abuja and had barely left the podium on his way back to the NNPC building when he heard that his sacking had been announced.
It is thought that his firing is connected with the recent relentless allegations of missing funds at NNPC. Industry watchers knew that heads had to roll over the allegations with many suggesting that the position of the chief executive of the organisation had become untenable under the circumstances. It seems that instead, it is the head of the outspoken GED that has been offered for the chop.
Abiye Membere will be remembered for his vigorous defence of the Petroleum Industry Bill (PIB) against sustained criticism from the Oil Producers Trading Section (OPTS) currently chaired by Mark Ward, Chairman, ExxonMobil Companies Nigeria. The OPTS is generally regarded as representing the interests of international oil companies (IOCs) even though it has some indigenous companies on board.
Abiye and Ward locked horns on several occasions over the ongoing debate over the fiscal provisions in the PIB. The IOCs and OPTS are vehemently opposed to the new fiscal terms and have appeared on numerous panels including the Senate and House of Representative hearings into the PIB to defend their position. On many of these occasions, Membere has been the one to speak on the Federal Government's behalf rubbishing the claims by the IOCs that the fiscal terms will make new investments in Nigeria's oil industry unfeasible. The IOCs continue to maintain that their position is supported by independent international financial organisations.
Membere has also sometimes been at loggerheads with NNPC's joint venture partners. He is said to have a combatant attitude and can therefore be difficult to deal with. Others however say that he was passionate about his job and discharged his function with great enthusiasm and that his enthusiasm was sometimes misunderstood.
Membere has been replaced temporarily by Dr. Joseph Dawha, who will be the Acting Group Executive Director, Exploration and Production. Dawha, who is from Borno State, was previously the Managing Director of Integrated Data Services Limited. Before that he had worked in NNPC in numerous roles in both upstream and downstream sectors of the industry.
Others appointed to fill existing vacancies on the NNPC Board are: Mr. Ian Udoh, the Group Executive Director, Refining and Petrochemicals; Dr. Dan Efebo, Group Executive Director, Corporate Services; Ms. Aisha Abdurrahman, Group Executive Director, Business Development; Mr. Adebayo Ibirogba, Group Executive Director, Engineering and Technical. Ms Aburrahman becomes the first female GED of the NNPC Board.
Among the NNPC GED positions, the GED, Exploration and Production is generally regarded as the most influential given the area of responsibility over the nation's oil and gas production.
All the appointments take effect immediately.
|
US Signs Deal to Fund Feasibility Study for Industrial Gas Complex in Nigeria
The U.S. Trade and Development Agency (USTDA) has given a grant to Nigeria for a feasibility study for a gas-based industrial complex project in Nigeria. The Agency says it has signed an agreement that will enable the feasibility study to commence. The study will evaluate the feasibility of facilities for the production of methanol, fertiliser, chemicals and petrochemicals. The study will look at the current market demand of the different chemicals in order to make recommendations on which of the chemicals, and accordingly which kinds of facilities, should be included in the project.
Under the agreement, USTDA will provide $257,000 for the study. The U.S. Consulate-General in Lagos said in a statement that the grant was aimed at building business relationships between the U.S. and Nigeria's emerging petrochemical industry. "The project holds the potential to generate significant U.S. exports of goods and services between the U.S. and Nigeria's emerging petrochemical industry,'' he added.
|
Arco Marine Adds Two Vessels to its Logistics Fleet
Nigerian local content maritime capability has received a boost with the news that indigenous maritime logistics operator, Arco Marine has just procured two vessels to service upstream oil and gas projects. The two vessels, MV Arco FCB4 and MV Arco FCB5, which cost the firm about $17.5 million were built to specs for the company, a subsidiary of the Arco Group. The commissioning of the vessels took place at the Naval Dock Yard in Lagos.
Chairman of Arco Group, Chief Joseph Akpieyi, gave credit to the Local Content Act, for the company's success. He said the Act had enabled the company to establish its growth in marine transportation and logistics and he hoped the Federal Government would continue to enforce the Act vigorously.
The vessels were designed to offer safe and secure coupling to offshore platform installations. The company expects its clients to be International Oil Companies (IOCs) operating offshore.
Arco Marine prides itself on having achieved a safety record of zero incidents and close to 100 per cent availability in its 23 months of operation, a feat that has been achieved, they say, with 100 per cent Nigerian financing, crew and management.
|
| CORPORATE SOCIAL RESPONSIBILITY |
NLNG To Fund Six University Engineering Laboratories With $12 Million
The Nigeria Liquefied Natural Gas Limited (NLNG) has announced its intention to give $2 million each to six universities for the construction of modern engineering laboratories. The labs will have state of the art facilities, with cutting-edge equipment.
The universities that will receive the donations have been selected from the six geo-political zones. They are: University of Ibadan, University of Ilorin, University Port Harcourt, University of Maiduguri, Ahmadu Bello University, Zaria and University of Nigeria, Nsukka.
Managing Director of NLNG, Babs Omotowa, said at the media briefing that no Nigerian university is ranked among the world's best 500 university. NLNG is hoping to change that dismal record by supporting education at Nigeria's universities.
The project is expected to deliver the labs within a year and NLNG intends to work closely with the universities to jointly monitor the projects.
Six-Train NLNG is the highest tax-payer in the country and in sub-Saharan Africa, having paid N220 billion in taxes on its operational profit in 2013. It is the highest gas income earner in the country after commercializing more than four trillion cubic feet of natural gas in its 25 years of existence. NLNG recently celebrated the shipment of its 3,000th cargo of LNG. The long awaited Train 7 of the gas company remains far from realisation.
|
|
Shell: Provision of Geotechnical Investigation Services
Shell Petroleum Development Company invites interested and registered Nigerian companies to respond to the opportunity for the provision of geotechnical investigation in various SPDC locations. The scope of service covers the carrying out of soil boring below ground surface and collecting disturbed and undisturbed samples for various tests. Only tenderers who are registered with the NJQS product/category; 30903 - Geotechnical Services product/services category shall be invited to submit technical bids. The closing date for this opportunity is 24th March, 2014.
Shell: Provision of Electric Wire-line Logging Services
Shell Petroleum Development Company invites interested and registered Nigerian companies to respond to the opportunity for the provision of electric wire-line logging services. The scope of service covers the provision of open hole logging (memory / wireless or wire-line) services,cased hole electric wire-line logging services and production logging and formation testing services. Only tenderers who are registered with the NJQS in the product/service category: Wire-line Services 3.04.24 shall be invited to submit technical bids. The closing date for this opportunity is 26th March, 2014.
Agip: Provision of Business Continuity Services
Nigerian Agip Oil Company Limited (NAOC) invites interested and registered Nigerian companies to respond to the opportunity for the provision ofSoftware Implementation services for various ICT areas in her offices in Abuja, Lagos and Port Harcourt including Rivers Bayelsa and Delta States. The scope of service covers the provision of effective implementation and solution to manage data growth and to simultaneously implement an effective business continuity and server virtualization solutions.Only tenderers who are registered with the relevant NJQS product/service category, shall be invited to submit technical bids. The closing date for this opportunity is 2nd April 2014.
Agip: Provision of ICT Network Infrastructure Components
Nigerian Agip Oil Company Limited (NAOC) invites interested and registered Nigerian companies to respond to the opportunity for the provision of IP Phones, switches, routers, wireless APs and security appliance for various ICT areas in her offices in Abuja, Lagos and Port Harcourt including the remote location in Rivers, Bayelsa and Delta States. The scope of service covers the provision of IP phones, switches, routers, wireless APS and security appliance on a call-off contract to support ICT operations at NAOC. Only tenderers who are registered with the relevant NJQS product/service category, shall be invited to submit technical bids. The closing date for this opportunity is 2nd April 2014.
|
|
2nd Africa Oil & Gas, Finance and Investment Forum
Following the success of the 1st Africa Oil & Gas Finance and Investment Forum, the AOGFI event from the 23rd to the 24th of September in Dubai, will once again bring together industry leaders and government bodies alongside investors, analysts and financial institutions to discuss future finance and investment opportunities in African oil & gas.
Covering an extensive oil and gas exploration area, both onshore and offshore, and with its huge hydrocarbon potential spurred by new discoveries in the eastern part of the continent, Africa will soon begin to play a strategic role as a world oil and gas supplier.
AOGFI 2014 will explore the environment that will attract sustained investments and finance to African oil and gas in a time of global economic uncertainty and changing regulatory environments.
AOGFI 2014 is organised by AME Trade Ltd and supported by APPA Fund and Dubai Chamber.
New for 2014:
- Pre-conference workshop for in-depth sector analysis and assessment
- Sector focused sessions - upstream, midstream and downstream opportunities
- Roundtable discussions with leading African NOCs and Ministers
For more information about the event please visit the website www.aogfi.com.
|
|
Mozambique Mining, Oil and Gas and Energy Conference and Exhibition
Maputo, Republic of Mozambique
26-28 March 2014
http://www.mozmec.comGhana Oil and Gas SummitAccra, Ghana 8-10 April 20th Western Africa Oil, Gas and Energy
Windhoek, Namibia
14-16 April 2014 http://www.petro21.com/events/?id=858
The Republic of Congo's Second International Hydrocarbons Conference & Exhibition
Brazzaville, Republic of Congo 14 - 16 April 2014 http://ciehc.com/englishhome/ Oil Spill Conference Nigeria 2014 Accra, Ghana April 23-25 2014 www.oilspillconferenceng.com 5th Eastern Africa Oil, Gas and Energy
Nairobi, Kenya
28-30 April 2014 http://www.petro21.com/events/?id=851
Oil Technology Conference Houston, USA 5-8 May www.otcnet.org Somalia Oil and Gas Somalia 9 June 2014 http://www.somalia-oil-gas.com East Africa Oil and Gas Summit London, UK 10-12 June http://eastafrica-oil-gas.com 2nd Africa Oil & Gas, Finance and Investment Forum
|
Don't forget to join our mailing list if you haven't done so already. Remember, you won't have to look anywhere else for your weekly Nigerian oil industry updates, and it's free to join.
Best wishes 
Remi Aiyela
Editor-in-Chief
|
|
|
|
|
