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Home > News > FG Boosts Oil, Gas, Power Industry through NNPC   BY JOHN MEZE

FG Boosts Oil, Gas, Power Industry through NNPC   BY JOHN MEZE

Efforts by the Federal Government to boost electric power generation in the country may soon yield the required dividend following the sustained increase in gas supply for power generation by the Nigerian National Petroleum Corporation, (NNPC).

The March 2017 edition of the monthly Financial and Operations Report of the Corporation, released recently at Abuja, said the average national daily gas production for the period stood at an impressive 226.918 billion cubic feet, (bcf), which translates to over 7.319 million standard cubic feet of gas per day, (mmscfd). However, the daily average national gas supply to gas power plants increased to 689mmscfd or the equivalent to power generation of 3056 mw.

The March 2017 figure is an improvement on the previous month’s record which stood at 582 mmscfd. The supply is also over 29 percent higher than the corresponding supply record for March 2016.

However, pipeline sabotage in the country increased from 49 downstream pipelines vandalized points in February 2017 to 94 in March 2017. This represents over 91 percent increase relative to the previous months despite Federal Government’s and the NNPC’s continuous engagement with the stakeholders. Nevertheless, there is a noticeable improvement compared to corresponding period of March 2016 which posted 259 cases.

Also, in the downstream sector, NNPC has in stock, a robust inland supply of over 1.2billion litres of petrol sufficient for more than 34 days forward consumption. On Automotive Gas Oil, AGO, and Aviation Turbine Kerosene, ATK, NNPC continued to import to supplement AGO local refining and the Central Bank has released foreign exchange to marketers to import AGO and ATK.

The report notes that the inaugurated 497.2 km System 2B petroleum pipeline network which was achieved within the period under review has helped the NNPC to sustain the gale of uninterrupted supply and distribution of products throughout the country.

Only recently the Nigerian National Petroleum Corporation Group Managing Director, Dr. Maikanti Baru, noted that the Corporation’s re-commissioned Mosimi and Kano depots had impacted positively on highways across the Country.

Dr. Baru had stated that the two depots had relieved the impacts of long haulage of petroleum products on the roads, saving the nation of serious environmental consequences of bridging to motorists, settlements along highways and the general ecosystem in the country.

The March 2017 NNPC monthly Financial and Operations Report is the 20th edition.

It was further gathered that the corporation has  re-commissioned Mosimi and Kano depots have impacted positively on highways across the Country.

Dr. Baru, who spoke during the 2017 World Environment Day (WED) in NNPC Towers, Abuja had said that the two depots had relieved the impacts of long haulage of petroleum products on the roads, saving the nation of serious environmental consequences of bridging to motorists, settlements along highways and the general ecosystem in the country.

Delivering the Keynote address at the occasion, Dr Baru said as an oil & gas company, NNPC acknowledged the importance of promoting environmental protection and sustainability across its value chain, stressing that NNPC was committed to environment friendly operations in the exercise of its mandate to explore and exploit the nation’s vast hydrocarbon resources for the benefit of all Nigerians.

Dr. Baru said the theme of this year’s WED celebration- “Connecting People to Nature” would propel the industry to get closer to nature and appreciate its beauty and splendor, while heeding the call to protect the mother earth that we share.

“We have over the years strived to maintain a healthy balance between our operations and the environment we operate in. This commitment has remained sacrosanct despite the numerous challenges resulting from pipeline vandalism and illegal bunkering activities that continue to impact on the quality of the environment we desire to safeguard” Baru stated.

He informed that in furtherance of its resolve to protecting the environment from avoidable hazards, the Corporation engaged the services of national and private security organizations to safeguard critical oil and gas infrastructure thereby curbing the menace of vandalism and the associated environmental damages.

The NNPC GMD aligned the Corporation with what he described as the globally agreed philosophy that seeks to maintain a healthy balance between exploitation of natural resources and preservation of the environment.

He also used the occasion to announce some positive strides recorded as a result of deliberate effort by Management to increase its environmental management quotient through increased compliance to International Standards Certification for its processes and operations.

“Today some of our Strategic Business Units (SBUs), are ISO 14001 and 9001 Certified Environmental Management System and Quality Management System respectively. Just recently, Management approved ISO 14001 Implementation and certification of NNPC Towers and this process is currently ongoing, ” he said.

In his paper entitled: Living Green in a Toxiferous Environment, guest lecturer, Dr. Evans Chidi of the Federal University of Technology, FUT, Minna, traced the advent of the World Environment Day celebration to 1972 when the United Nations General Assembly unanimously voted to designate a day for the sole purpose of engendering a lasting discussion on the integration and interplay of human interaction and the environment.

He noted that the thematic preoccupation of WED through the years had been consistent with the desire to promote eco-friendliness in all human endeavors.

Earlier in his welcome speech, Ahmed Shehu, General Manager in charge of Health, Safety and the Environment Department of the Corporation, noted that to achieve eco-friendliness, mankind must appreciate how other creatures – animals, Mountains, forests and swamps contribute to achieving the much-needed delicate balance of the eco-system.

He explained that uncontrolled adventure into the environment has the potential to wreak havoc on the environment.

 

In pursuance of the federal gover4nment’s   object of ensuring availability of refined products at affordable price the corporation brought down the price of Automotive Gas Oil (AGO), also known as Diesel to about 42% nationwide, a situation seen as a huge downslide over the last six months.

It would be recalled that in the first quarter 2017, retail prices of AGO, which is one of the deregulated products, shot to an all-time high of N300/litre in major demand centres across the country.

Such unpleasant situation placed a huge burden on truck drivers, who need the product for transporting their vehicles; the nation’s manufacturing sector, which requires it to run its operations as well as on the masses, who need it for household power generation.

However, following strategic intervention efforts by the NNPC towards sustained improvement in the supply of the diesel, the product’s retail prices as at the end of May 2017 ranged from N175 to N200 across the country (a significant price drop of about 42%), while ex-depot prices also dropped to between N135 and N155.

Shedding more light on this remarkable achievement, NNPC Spokesperson, Mr. Ndu Ughamadu, said some of the Corporation’s strategic interventions in this regard include improving the supply of AGO and remodeling of the product distribution to address sufficiency issues across the country.

“Since January this year, we have worked very hard with relevant stakeholders to improve distribution from refinery depots, by implementing a robust loading programme,” Ughamadu affirmed.

Also, in its quest to enhance efficient distribution of AGO, the Corporation was able to resuscitate its critical pipelines and depots in places such as Atlas Cove-Mosimi, Port-Harcourt Refinery-Aba and Kaduna Refinery-Kano. Efforts are also ongoing to revamp and commission other critical pipelines across the country.

Another key intervention that has enhanced supply and distribution of diesel, the NNPC Spokesperson noted, was the Corporation’s robust engagement with critical downstream stakeholders where salient issues were raised and duly addressed. These stakeholders include: Major Oil Marketers Association of Nigeria (MOMAN), Nigerian Association of Road Transport Owners (NARTO), Petroleum Tanker Drivers (PTD) as well as Independent Petroleum Marketers.

Furthermore, as a result of consistent positive engagement with the Central Bank of Nigeria (CBN), NNPC equally extended the expansion of Premium Motor Spirit (PMS) Foreign Exchange Intervention Scheme to accommodate Diesel and Aviation Fuel.

The general public is hereby assured that the Corporation would continue to ensure seamless supply and distribution of diesel and other petroleum products across the country to make the lives of Nigerians better

In a related development, it has engaged itself in extensive oil and gas community stakeholders meetings which has continued to yield positive results with the attainment of 12.77 per cent reduction in downstream pipeline vandalism.

According to the April 2017 NNPC Financial and Operations report released in Abuja, recently, downstream pipeline sabotage decreased from 94 pipeline vandalized points in March, 2017 to 82 in April 2017, representing a 12.77% reduction relative to the previous month. The April 2017 numbers also indicate substantial progress compared to corresponding period of April 2016 which recorded 214 incidents.

In terms of products availability within the period, the Corporation maintained adequate stock of over 1.2 billion litres of petrol sufficient for more than 34 days forward consumption.

It was also recorded that during the period, the NNPC in an effort to reduce to the barest minimum the incidences of fire outbreak in the 21 depots across the country, received bids from no fewer than 37 companies to supply six triple agent firefighting trucks for the operation of the Nigerian Pipelines and Storage Company (NPSC), one of the downstream subsidiaries of NNPC.

The report noted that NNPC has continued to import Automotive Gas Oil (AGO) and Aviation Turbine Kerosene (ATK) to supplement local refining, while the Central Bank of Nigeria, CBN continues to make available foreign exchange to marketers to import AGO and ATK.

The April 2017 report which is the 21st edition of the NNPC Financial and Operations report also noted that average national daily gas production stood at 242.32 Billion Cubic Feet, BCF or an average of 8,077.19 Million Standard Cubic feet per day, representing 6.79% increase relative to the previous month.

Comparatively, the daily average natural gas supply to gas power plants slightly decreased to 672mmscfd (or equivalent to power generation of 2,787 MW in April, 2017) relative to 689mmscfd recorded in last month. However, this supply is also 22.85% higher than the corresponding supply recorded in April 2016 of 547mmscfd, the report stated.

Further on the power industry, the corporation has concluded arrangements to build 500million standard cubic feet of gas per day metering plant to serve the planned capacity expansion of Egbin Power Plant from its installed capacity of 1,320 Megawatts to 2670MW.

Managing Director of the Nigerian Gas Processing and Transmission Company (NGPTC), Mr. Babatunde Bakare, who spoke during the tender for the prequalification for the Engineering, Procurement and Construction (EPC), of the project,in Abuja had said that  the bid exercise which witnessed bid submissions by 36 local and international companies, was a demonstration of NNPC’s commitment towards improving power supply in the country in line with President Muhammadu Buhari’s vision for the power sector.

NNPC is the biggest gas supplier to Egbin power plant, which in turn, is equally the biggest power plant in Nigeria.

NNPC Chief Project Engineer for the project, Engr. Audu Ibrahim, who represented the NGPTC MD, said the expansion of the metering system to serve the Egbin Power Plant was imperative to coping with the heightened volumes of gas that might be needed as a result of its planned expansion.

The General Manager, Supply Chain Management, represented by the Manager, Mr. Rotimi Feyisitan, said due diligence in respect of technical and financial requirements would apply to all the 36 companies which submitted bids in line with the Corporation’s transparency policy.

Feyisitan assured that there would be no under-the-table dealing with any of the companies.

The exercise represents part of NNPC strategic moves to increase its footprint in the nation’s power supply mix, with a view to expanding the Corporation’s stakes in non-core hydrocarbon resources businesses.

And as a part of concerted efforts to resolve the nation’s electric power challenge, it has reached an agreement with the Bayelsa State Government are to build a power plant in the state.

Dr. Baru said the power plant would be built at the state’s proposed industrial park, stressing that the collaboration would afford the state and NNPC the opportunity to share technical knowledge that would attract investors to the Niger Delta region.

“We have a lot of areas of collaboration. The NNPC will support Bayelsa State Government every inch of the way to deliver on the power plant in the proposed industrial park, ensure security of oil and gas infrastructure and siting of other inclusive projects that would improve the lives of the people in the communities,” Dr. Baru assured.

The GMD said Bayelsa State was earmarked for the Federal Government’s Greenfield Modular Refinery project which feasibility studies had been concluded, adding however that the project was stalled due to the withdrawal of the foreign partners from the project.

Commenting on the delay on the Final Investment Decision (FID) of Brass Liquefied Natural Gas (BLNG), the GMD stated that the project had not taken off because arrangements are on for a market window for the product.

“We have spent a lot of money on the Brass LNG project and we had planned the FID for 2012 but the shareholders were unable to secure the market due to new plants in East Africa and other developments in the industry. What the shareholders in Brass LNG are doing now is to redesign the plant and secure a market because without the market the project cannot go on,” he said.

The GMD also expressed interest in the state’s Brass Fertilizer Company, assuring that NNPC was prepared to invest in the project as a shareholder.

Dr. Baru further pledged to rally NNPC and its Joint Venture partners to support the State Trust Fund in order to mitigate the incidences of pipeline vandalism which impact negatively on the efficiency of the operators as well as the environment.

Earlier, the Governor Seriake Dickson said the visit was to appreciate the laudable efforts of the GMD and his team and to solicit the Corporation’s support for the state’s security, development and the Oil and Gas industry.

Governor Dickson told the GMD that his state would seek an Oil Prospecting License, OPL, whenever the industry undertakes another bid round.

He noted that his state needed such investment, over time, to augment the monthly allocation from the Federal Government.

 

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