 LATEST MAGAZINE ISSUE
Click to read
|
 Click to read
|
|
|
|
|
Welcome to our 106th issue.
|
OPEC daily Basket Price Stood at $92.31 a Barrel Wednesday, 1 October 2014
The price of the Organization of the Petroleum Exporting Countries (OPEC) basket of twelve crudes stood at $92.31 dollars a barrel on Wednesday, compared with $94.17 the previous day, according to OPEC Secretariat calculations. This puts the OPEC basket price at a 2-year low.
Oil prices remain under pressure as the downward trend continues. Brent has seen prices go down to a 27-month low standing at $94.67 on Tuesday while WTI crude which lost 13 per cent this quarter alone, standing at $91.27 on Tuesday.
Oversupply from OPEC, which supplies a third of the world's demand for oil, is being blamed for the weak oil prices as a Reuters survey revealed that OPEC output reached a 2-year high in September, averaging 30.96 million barrels per day (bpd) in September. The boost in OPEC production comes mainly from Libya, which has seen production rise by 280,000 bpd, whilst Nigeria, Saudi Arabia, Angola and Iraq have also kept production levels up. Analysts say that supply has now outstripped the demand forecast for OPEC crude. In addition a slowdown in manufacturing in China and Japan, as well as the strong dollar, are said to be helping to keep prices depressed.
As finance ministers of OPEC member nations keep a watchful eye on their budgets, the question for the members at the next OPEC meeting scheduled for the 27th of November in Vienna, will now not be whether or not to cut production. Instead they are now likely to discussing by how much to cut production. It is clear that nothing short of a production cut is going to be enough to reverse the downward trend. The OPEC Secretary General Abdullah al-Badri agrees, saying last month that he expects that production will have to be cut to around 29.5 million bpd in 2015.
The new OPEC Reference Basket of Crudes (ORB) is 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).
|
Niger Delta E&P Plans $450m Capital Raise Through Public Offer
Successful Nigerian independent, Niger Delta Exploration and Production (NDEP) has announced plans to raise $450 million through a "public offer or special placement of shares." The company intends to use the funds to redevelop and ramp up production in Ogbele field in OML 54, develop its newly acquired Omerelu gas field in OML 53, increase the capacity of their gas plant on Ogbele, refinance existing debt and look at new projects and acquisitions. The company, which says it has a pan African outlook, is said to be considering international acquisitions, particularly in South Sudan and Zambia.
NDEP, which operates some assets through its subsidiary Niger Delta Petroleum Resources (NDPR), is one of Nigeria's independent indigenous success stories. The company was formed by a number of seasoned oil and gas professionals and they executed the first farm out of a marginal field in Nigeria with the acquisition of Ogbele from Chevron, going on to achieve first oil on the field in 2005.
The Company's growing portfolio includes a 100 per cent interest in Ogbele marginal field; an 18.75% participating interest in the onshore producing OML 34 in 2012; a 100% participating interest in the onshore Omerelu Field located within OML 53 and currently under appraisal; and a 6% participating interest in OPL 227.
Other assets are a 25,000 barrels per day ("Mbopd") flowstation; a 1,000 bpd mini refinery (Diesel Topping Plant), which is currently the only privately owned and licensed producing refinery in Nigeria; a 100 MMscf/d gas processing plant ("Ogbele Gas Plant"); and a 20 km 12" gas pipeline built to deliver gas from Ogbele through the NLNG manifold at Rumuiji to the Bonny NLNG plant.
In 2013, the average gross operated and non-operated oil and gas production from Ogbele field and OML 34 was 15,000 bopd and 346 MMscf/d respectively. Based on current performance and production levels, NDEP is on track to increase gross oil production from its existing assets significantly by 2015. As of 31 March 2014, based on internal management estimates, the Company had total working interest 2P oil and condensate reserves of 80 MMboe.
NDEP pioneered the Community Development Trust Programme with their host communities on Ogbele ensuring uninterrupted workflow. After the recent execution of the Omerelu farm in agreement, Dr. Layi Fatona, said: "An exciting time lies ahead. As we worktowards first oil, we will draw from the lessons learnt in our journey as pioneers of marginal field development in Nigeria; not least the co-option of host communities through the Host Community Development & Environment Trust and the importance of working in an environmentally friendly manner."
The war chest of $450 million that it now seeks will enable NDEP, which has been able to transform itself into a fully integrated oil and gas company, to make some transformational acquisitions. FBN Capital Plc and Chapel Hill Denham have been appointed financial advisers for the fundraising, which will be done on local and international markets. Chief Executive Officer, Layi Fatona predicts that the first tranche of $200 million will be raised before the end of 2014.
|
PTDF to Create 6 New Zonal Offices
The Petroleum Technology Development Fund (PTDF) is to create zonal offices across the country. The new Executive Secretary of the Fund, Femi Ajayi who made this disclosure recently, said that creating zonal offices across the six geo-political zones of the country would make the organisation more efficient and bring it closer to the people.
Explaining the vision behind the creation of the zonal offices, Ajayi said: "My dream and what I am going to work towards is a PTDF that is more result oriented, PTDF that gives value for the money that is invested in the organization and a PTDF that is closer to the people, because at the moment we have only PTDF in Abuja, and for a big country like Nigeria, I think we need zonal offices, add to it is the idea of this agency being a national one and that is why I am so passionate about it and I believe it will serve the greatest good of the greatest number of people if we decentralize a bit."
Ajayi intends to put the plan into progress immediately and expects two of the offices to be up and running by the beginning of next year.
In other news, the PTDF reports that the Executive Secretary, Ajayi has commenced the tour of all the training centers being utilized for the Fund's Welding Training and Certification Programme (WTCP). He has inspected welding training facilities in Port Harcourt, Lagos, Minna and Benin, expressing satisfaction with their training facilities.
Justifying the PTDF's expenditure on the programme Ajayi said that the Fund is committing so much money on welding to exploit what he termed as "the low hanging fruit" because at the level of the country's development, it is imperative to invest more in quick-win projects having more impact in the industry and capable of satisfying the President's agenda of addressing youth empowerment and unemployment.
Whilst visiting the training centre in Minna, Ajayi also revealed details of a new initiative, the Entrepreneurship Development Training Program (EDTP) that will enable participants of the WTCP to acquire robust entrepreneurial skills capable of empowering them with business skills that will make them self sufficient. It will also enable trainees, following the completion of their training, to become employers of labour in the field of welding and fabrication in order to participate in bridging the industry's gap, and contribute to economic growth and sustainable development.
Ajayi said that it was regrettable that, although over 1700 young Nigerians have been trained by PTDF to qualify as International Welding Practitioners and Specialists as well as in the basic welding programmes, the trainees have not been able to get employment afterwards. This, he said, justifies the decision of the Fund to integrate the EDTP as a compulsory component of the welders training and certification programme.
|
NCDMB to Spend $50- $100 Million on Oil and Gas Parks
The Nigerian Content Development and Monitoring Board (NCDMB) has revealed plans to spend up to $100 million developing Nigerian Oil and Gas Parks. The Parks are expected to promote the manufacturing of oil and gas components and provide opportunities for research and development.
The Executive Secretary of the Board, Ernest Nwapa disclosed this at the close-out ceremony of the Nigerian Oil and Gas Parks Scheme Training Programme held recently in Yenagoa, Bayelsa State. The training programme was for the training of NCDMB staff who will spearhead the design and operation of the Nigerian Oil and Gas Parks Scheme (NOGAPS).
Nwapa explained that NCDMB will spend $10 million on each park for phase one, and up to $50 million and $100 million subsequently, depending on the focus of each park. The Board, he says, already has a budget approval of $10m for each of the parks from the Nigerian Content Development Fund (NCDF).
Nwapa said that the Board embarked on the development of the parks to bring Local Content practice closer to the grass roots and integrate oil and gas based entrepreneurs into manufacturing as well as support the growth of Small and Medium Enterprises (SMEs) through mentoring by international Original Equipment Manufacturers (OEMs) and other multinationals.
According to Nwapa, "the scheme is specifically for industrial activities and for us to succeed, we have to build it in such a way that it will be accessible to rural dwellers. That is the distinction between this and other parks. We will structure it in such a way that it will grow organically so that over a period it will come to maturity."
The oil and gas parks will be sited in Bayelsa, Imo and Cross Rivers States in the first phase and preliminary construction activities are about to begin. Nwapa said NCDMB would begin engagement with communities where the parks will be situated and advised members of such communities to always see project promoters as development partners.
Nwapa sees the Parks as a lasting legacy to local content. He explained: "I want to be able to point at some monuments and say that apart from insisting that the industry grow and do the right thing, create jobs and value in Nigeria, we have also as an agency of government created this pipe mill, this oil and gas park and changed the way things are done in the industry."
In a goodwill message, the General Manager, Nigerian Content, Exxon Mobil, Mr. Sola Ogunsakin pledged the commitment of international oil companies towards making the Oil and Gas Parks Scheme a success.
"We believe in this programme and we are going to contribute our quota towards making it a success. The Board has taken several giant strides in promoting the Nigerian Content since the enactment of the Act. This is going to attract foreign and domestic investments, promote community participation, manufacturing and foster the mentoring of local small and medium scale enterprises," he said.
|
NCDMB Inaugurates Consultative Forum Committees
In a bid to generate new ideas for the development of Nigerian Content in the oil and gas industry, the Nigerian Content Development and Monitoring Board (NCDMB) has inaugurated 10 sectorial committees of the Nigerian Content Consultative Forum (NCCF.
The NCCF sectorial committees are Fabrication; Finance, Insurance and Legal Services; Shipping and Logistics; Education and Training; Petroleum Technology and Multinationals; Materials and Manufacturing; Information and Communication Technology; Engineering and Essential Services, which covers Medical Services, Health, Safety & Environment, Catering & Hospitality.
Speaking at the inauguration, the Executive Secretary of the Board, Ernest Nwapa explained that the objective of constituting the NCCF committees was to provide a platform for information sharing on upcoming projects and local capabilities. He said that the committees will also be expected to articulate and recommend strategies for developing Nigerian. He told them: "You have to help us so that we can get solutions required to move forward."
In his welcome speech, the Director, Planning, Research and Statistics, NCDMB, Mr. Patrick Obah commended President Goodluck Ebele Jonathan for signing the Nigerian Oil and Gas Industry Content Development Bill into law and making Nigerian Content a key plank of his economic policies. Obah also attributed the successes recorded by the Board to the unflinching support it receives from the Minister of Petroleum Resources, Diezani Alison-Madueke.
|
Oil and Gas Firms Target Oil & Gas Methane Reduction
Nigeria is among the major oil producing nations and six oil and gas companies that are partnering with the Climate and Clean Air Coalition (CCAC)'s voluntary initiative to reduce methane emissions in the oil and gas sector. Called the CCAC Oil & Gas Methane Partnership, the programme was officially launched at the United Nations Secretary General's Climate Summit in New York on 23 September 2014. The founding companies are BG-Group, Eni, Pemex, PTT, Southwestern Energy, and Statoil.
The CCAC Oil & Gas Methane Partnership aims to create a global standard in controlling methane emissions in oil and gas systems. CCAC explains that methane is at least 84 times more potent than CO2 over a 20-year time horizon, and the oil and gas industry is the largest man-made emitter of methane after agriculture. The International Energy Agency identified minimizing methane emissions from upstream oil and gas production as one of four key global greenhouse gas mitigation opportunities, noting that upstream methane reductions could account for nearly 15 percent of the total greenhouse gas reductions needed by 2020 to keep the world on a 2-degree path.
CCAC Oil & Gas Methane Partnership aims to provide companies with a credible mechanism to systematically and responsibly address their methane emissions - and to demonstrate to stakeholders that they are doing this.
Key technical partners include the Environmental Defense Fund, the U.S. EPA's Natural Gas Star programme, the Global Methane Initiative and the World Bank's Global Gas Flaring Reduction Initiative. The CCAC conducted a year-long consultation process with experts from oil and gas companies, IPIECA, NGOs, reporting initiatives and other experts to develop the Partnership. The goal was to create a mechanism that met the accountability requirements of stakeholders and, at the same time, was implementable by companies and supported by governments. It has also won the endorsement of investor groups.
A company joining the CCAC Oil & Gas Methane Partnership voluntarily commits itself to the following in its participating operations:
- Survey for nine core sources that account for the bulk of methane emissions in typical upstream operations;
- Evaluate cost-effective technology options to address uncontrolled sources with a view toward implementation; and
- Report progress on surveys, project evaluations and project implementation in a transparent, credible manner that demonstrates results.
The CCAC has identified nine "core" emission sources of methane in typical oil & gas upstream operations, and they are:
- Natural gas driven pneumatic devices, pumps
- Centrifugal compressors with wet (oil) seals
- Glycol dehydrators
- Well venting of liquids unloading
- Casinghead gas venting
- Fugitive equipment and process leaks
- Reciprocating compressor rod seal/packing
- Hydrocarbon liquid storage tanks
- Well venting/flaring during well completion for hydraulically fractured wells
The CCAC - and its partners - will support a participating company's efforts, including with technical assistance, encouraging development of policies and practices that promote and support oil and gas methane emission reduction activities within CCAC country borders and beyond, and provide an independent Partnership Administrator.
In order to promote this new standard and realize the emissions reductions potential identified by the IEA and others, the CCAC Secretariat and founding member companies invite additional committed companies to join the Partnership on an ongoing basis by contacting the Oil & Gas Administrator at the CCAC Secretariat (philip.swanson.affiliate@ unep.com).
|
Petroleum Minister Hosts Forum on Environmental Restoration of Ogoniland
In a demonstration of her commitment to the restoration of Ogoniland, the Minister of Petroleum Resources, Diezani Alison-Madueke, recently hosted a forum on the Environmental Restoration of Ogoniland. This comes three years after the report by the United Nations Environmental Programme (UNEP), which said that Ogoniland, ravaged by years of oil pollution and neglect, would require 20 years of restoration work for the harmful effects of the pollution to be reversed.
Alison-Madueke insists that her mission to clean up Ogoniland was a personal one, describing herself as a daughter of the land. She was born in Rivers State and has decided to drive the restoration of the Ogoniland area, large swathes of which have been left desolate and riddled with pollution, after decades of neglect.
Three years ago, UNEP released the devastating report, which made a number of recommendations including emergency measures to be undertaken in the restoration of the area. After one and half years in which very little was done, the government constituted an organisation, the Hydrocarbon Pollution Restoration Project (HYPREP) to lead the implementation of the UNEP recommendations. In spite of this move, three years later, and not much has been achieved.
Now, after inviting executives from government agencies, international oil companies, UNEP, activist groups and other stakeholders to a public forum, she has committed herself to seeking restoration of the devastated area. The Minister hopes that with her renewed zeal the restoration project will stand a better chance of achieving its goals.
Alison-Madueke urged stakeholders to create a viable, sustainable road map for the comprehensive rehabilitation, remediation and restoration of Ogoniland. The government, she said, was now prepared to implement the recommendations of the UNEP report.
Explaining the purpose of the discourse, she said: "It is my expectation that one of the outcomes of our discourse here today is, in fact, the appropriate structure or entity that should be put in place for the deployment and disbursement of the funds for Ogoni restoration."
"Upon consultations with the people of Ogoniland, it has become clear that the community and relevant stakeholders have not been properly consulted or incorporated into the implementation processes of the UNEP report".
"What I am hoping is that out of this very broad multi-lateral stakeholders' discourse, and, as you can see, we brought all stakeholders in the Ogoni restoration efforts here, including UNEP who actually put forward the guidelines, and what we intend is that out of this will come the answer to some of the questions."
"I think that with UNEP and other multilateral bodies and Ogoni people and community organisations, we will clearly create a major steering committee and we will face the restoration process in such a manner that people will actually see and feel what is happening."
Alison-Diezani explained that the youth would not be left out. They will be involved in the process, she said, noting that they are critical to the cleanup project and that they will receive appropriate training. To that end, she said, a Centre of Excellence in Environmental Restoration in Ogoniland would be set up to train and provide competences, vocational and specialist technical skills, capacity building, expert assistance and support services required by stakeholders, and government agencies to carry out their mandates in protection, preservation and restoration of impacted environment." She expects that this will be in place within a year.
The president of Movement for the Survival of Ogoni People (MOSOP), Legnorsi Saro Pyagbara who addressed the gathering, was not to be so easily placated. He stressed: "For the Ogoni people we are not prepared for any half measure in the way to implementing this report. For the Ogoni people, we feel that all that is needed should be put in place for the full implementation of that report. I think this is where the Ogoni people stand and as I said MOSOP is very prepared, Ogoni people is very prepared to follow you as long as the process is genuine, the method is transparent and so long as there is effective consultation that respects the equality of every stakeholder in this process".
UNEP has made a provisional estimate that $1.6 billion in funding will be required for a full remediation programme.
|
West Africa Gas Conference and Exhibition
Abuja, Nigeria
28 - 30 October 2014
www. http://west-africa-gas.com Nigeria Oil and Gas Trade and Investment Forum Onne, Nigeria 30-31 October 2014 http://www.nigeriaoilandgasinvest.com/ 21st Africa Oil Week Cape Town, South Africa 3-7 November 2014 http://www.petro21.com/events 32nd Annual International Conference of the Nigerian Association of Petroleum Explorationists Lagos, Nigeria 09-13 November 2014 www.nape.org.ng 15th World LNG Summit and Awards Paris, France 18 November 2014 www.world.cwclng.com Practical Nigerian Content Yenagoa, Nigeria 18-20 November 2014 http://www.ncipnc.com/ Mozambique Gas Summit Maputo, Mozambique 2-5 December 2014 http://www.mozambique-gas-summit.com/ Indigenous Oil & Gas SummitLagos, Nigeria 2 - 4 December 2104 http://www.afrikinternationalnetworks.com/Mozambique Gas Summit Maputo, Mozambique 02 December 2014 http://www.mozambique-gas-summit.com Nigeria Oil and Gas Conference and Exhibition Abuja, Nigeria 02 February 2015 www.cwcnog.com Ghana Summit Conference and Exhibition Accra, Ghana 21 April 2015 www.cwcghana.com Oil, Power and Mining Orlando, Florida, USA 12 - 14 August 2015 www.oilpowermining.com/ |
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
|
|
|
|
|
