P.M. NEWS Nigeria » Electricity, Oil and Gas http://www.pmnewsnigeria.com First with Nigeria News - Nigerian leading evening Newspaper - Sun, 14 Dec 2014 11:57:06 +0000 en-US hourly 1 http://wordpress.org/?v=4.0.1 61 ships with containers, petroleum products expected in Lagos http://www.pmnewsnigeria.com/2014/12/08/61-ships-with-containers-petroleum-products-expected-in-lagos/ http://www.pmnewsnigeria.com/2014/12/08/61-ships-with-containers-petroleum-products-expected-in-lagos/#comments Mon, 08 Dec 2014 15:07:56 +0000 http://www.pmnewsnigeria.com/?p=222182 Nigerian Ports Authority

Nigerian Ports Authority

Sixty-one ships laden with containers, foods and petroleum products are expected in Lagos ports from Dec. 8 to Dec. 28.

The Nigerian Ports Authority (NPA) made the announcement in its daily publication, “Shipping Position”, made available to newsmen on Monday in Lagos.

The document showed that eight of the ships would arrive with fresh fish, while 21 others have containers of different goods.

It stated that 10 other ships were expected to arrive with petroleum products like petrol, diesel, kerosene and aviation fuel.

The document showed that five ships containing buckwheat were also being expected, while the remaining 17 ships would arrive with bulk rice, used vehicles, bulk fertiliser, base oil and general cargo.

It stated that five ships had arrived and waiting to berth with bulk rice, buck wheat, bulk sugar and bulk fertiliser.

The document indicated that nine other ships were also waiting to discharge petroleum products such as petrol, diesel, kerosene, crude palm oil and base oil.

According to the document, 22 other ships are discharging cargoes like buckwheat, ethanol, bulk rice, fertiliser, general cargo, containers, bulk sugar and petroleum products.

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African Utility Week returns to Cape Town http://www.pmnewsnigeria.com/2014/12/05/african-utility-week-returns-to-cape-town/ http://www.pmnewsnigeria.com/2014/12/05/african-utility-week-returns-to-cape-town/#comments Fri, 05 Dec 2014 11:34:46 +0000 http://www.pmnewsnigeria.com/?p=221779 African Utility Week

Regional collaboration in the power and water sectors, the untapped potential of renewable energy and investment challenges will be top of the agenda at the 15th African Utility Week and Clean Power Africa conference and exhibition, returning to the CTICC in Cape Town from 12-14 May next year.

The event is expected to again attract more than 5000 attendees and feature 250 exhibitors, 190 speakers, eight conferences, free technical workshops on the expo floor, three high-profile plenary sessions and the coveted industry awards gala dinner.

The event brings together utility professionals from across the globe to learn, share knowledge and debate the key topics that will secure the future development of Africa’s power and water industries.

The new event director for African Utility Week Evan Schiff said: “Based on consultations with the industry, we have extended the conference and exhibition by an extra day, so we now offer three days of conference sessions, networking and an extra plenary session. The theme of our opening plenary session is: ‘Africa is open for business’. We have a few surprises up our sleeves in terms of keynote speakers and at this stage we can confirm that the Rockefeller Foundation’s Managing Director for Africa, Mr Mamadou Biteye, is part of our high-level line-up.”

“Our most important aim is to remain relevant by providing the best industry insight and knowledge to attendees. To ensure we are plugged in to the most up to date information, we work very closely with leading and pioneering individuals and companies in the sector. Our high-level advisory board is a veritable who’s who of the power and water industries and our conference and technical workshop programmes reflect this with topical, up-to-date discussions and presentations,” he said.

In respect to challenges in the industry, the African Utility Week director says “there is a growing need for regional collaboration: establishing a regulatory framework for the entire region and cross-border power supplies and exchanges. Furthermore, there is vast untapped potential in solar PV, wind, and geothermal that can be used as power generation sources.”

Another major challenge is access to finance for investment in energy projects and infrastructure development. To address the calls for more information on this key sector, African Utility Week 2015 presents a new Finance & Investment conference track that will create a unique forum for utilities, governments and project developers to meet with international, regional, local and alternative financiers to explore new opportunities arising from the utility industry, address relevant challenges, and answer some of the thorny funding questions. It will have the objective of encouraging funding and revenue inflows into the utility sector by engaging leading decision makers on the global finance and investment arena.

Eskom will again host utility for the event, Cape Town the host city while the event also enjoys the support of professional industry bodies such as the South African Institute of Electrical Engineers (SAIEE), the Power Institute for East and Southern Africa (PIESA) and Southern Africa Asset Management Association (SAAMA).

Big suppliers of technology and services to the sector have also already signed up as high-profile partners at the event, including global player DNV GL as exclusive diamond sponsor, while Accenture, Building Energy, MarelliMotori and Rubbytad are the four platinum sponsors.

The three-day event will include an invitation-only, Utility CEO Forum where C-level executives from Africa’s leading utilities come together to discuss pressing topics within the industry and to accelerate cross-border collaboration, development plans and the advancement of regional centres of excellence throughout Africa. Utility executives from countries such as Nigeria, Uganda, Namibia, Ghana, Malawi, Zambia, Zimbabwe and South Africa are expected to return.

The event will also feature an award ceremony in ten categories which will includes the ‘Outstanding Woman in Power’.

Attending the African Utility Week and Clean Power Africa exhibition is free when registering in advance and it showcases energy saving technologies and services for the industry and features hands-on demonstrations and CPD-accredited technical workshops on the exhibition floor. Log on to www.african-utility-week.com for free registration.

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Total inaugurates major oil project off Angola http://www.pmnewsnigeria.com/2014/12/04/total-inaugurates-major-oil-project-off-angola/ http://www.pmnewsnigeria.com/2014/12/04/total-inaugurates-major-oil-project-off-angola/#comments Thu, 04 Dec 2014 22:47:10 +0000 http://www.pmnewsnigeria.com/?p=221732 Photo: AFP

Photo: AFP

French oil firm Total on Thursday inaugurated a major project off Angola with a capacity of 160,000 barrels per day as the company touted its African investments in the face of falling prices.

New chief executive Patrick Pouyanne inaugurated the CLOV project, which draws from four deep-water fields off Angola in the Atlantic off southwestern Africa.

CLOV was launched in 2010 at a cost of $8 billion (6,5 billion euros). Thursday’s inauguration came with petroleum-producing nations and the industry struggling with falling oil prices.

“Total has three particular strengths: ultra-deep water, liquefied natural gas and Africa,” Pouyanne said at the ceremony, adding that Total was the largest producer on the continent.

It is also the largest producer in Angola.

“Despite the volatility of oil prices, we are keeping a long-term vision and we are maintaining the projects that have been announced, such as Kaombo in Angola,” he said.

The development of the Kaombo project however, which the company hopes will produce 230,000 barrels per day, has seen a budget cut, from $20 billion to $16 billion.

A third of Total’s production as operator — some 670,000 barrels per day — occurs in Africa.

Pouyanne, who took over after the recent death of Christophe de Margerie in a Moscow plane crash, visited Gabon as well during his trip and plans to visit Nigeria in January, where Total also has investments.

Nigeria remains Africa’s largest oil producer at some 1.88 million barrels per day in October, according to the International Energy Agency. Angola is the second-largest, with October production at 1.72 million barrels per day.

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OPEC boss, Diezani, says cartel facing ‘challenging’ time http://www.pmnewsnigeria.com/2014/12/04/opec-boss-diezani-says-cartel-facing-challenging-time/ http://www.pmnewsnigeria.com/2014/12/04/opec-boss-diezani-says-cartel-facing-challenging-time/#comments Thu, 04 Dec 2014 07:25:04 +0000 http://www.pmnewsnigeria.com/?p=221648 Diezani Alison-Madueke, Nigeria  Petroleum Minister

Diezani Alison-Madueke, Nigeria
Petroleum Minister

OPEC is facing a challenging time due to the fall in oil prices and many members and non-members are “suffering immensely”, the cartel’s president and Nigeria’s oil minister, Diezani Alison-Madueke, said Wednesday.

“This is a very challenging time as you know for OPEC and for the global crude oil wells as a whole,” she told journalists in Abuja.

“Many countries both OPEC and non-OPEC countries are suffering immensely,” she said.

Alison-Madueke said Venezuela, Angola, Algeria, Iran and Nigeria had either taken strict fiscal measures to cushion the effects of the plummeting prices or had their budgets placed “under duress”.

Russia, a non-OPEC country that is not cutting production, is witnessing a drop in the value of its currency, she said.

“Our prayer …is that we will be able to stabilise the crude oil prices per barrel over this period because it is critical,” she said.

Crude prices are currently hovering around 70 dollars a barrel in New York and London.

The minister said she would closely monitor the prices to determine if a special OPEC meeting was needed to discuss strategies to address the situation.

Nigeria, Africa’s largest oil exporter, has to be more competitive “at this time and going into the future. We cannot continue to do business as usual,” she said.

Corruption and mismanagement have blighted the nation’s oil industry.

Crude oil is the mainstay of Africa’s largest economy.

Nigeria said last month it was reviewing its fiscal and monetary policies to deal with the predicted fall in revenues after oil prices fell by a third since June.

Finance Minister Ngozi Okonjo-Iweala said spending plans made on an oil price benchmark of $78 dollars a barrel for 2015 were being reviewed downward to $73 dollars a barrel.

She said oil accounts for 83 per cent of Nigeria’s exports.

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Oil losses continue after OPEC maintains output http://www.pmnewsnigeria.com/2014/11/28/oil-losses-continue-after-opec-maintains-output/ http://www.pmnewsnigeria.com/2014/11/28/oil-losses-continue-after-opec-maintains-output/#comments Fri, 28 Nov 2014 11:38:06 +0000 http://www.pmnewsnigeria.com/?p=221039 OPEC

OPEC

Oil extended losses in Asian trade Friday after the OPEC cartel refused to cut production despite a global glut that has sent prices slumping to four-year lows, with analysts warning of further falls to come.

US benchmark West Texas Intermediate (WTI) for January delivery was at $68.63 a barrel in late afternoon trade, down 42 cents from its settle price in electronic trading in New York on Thursday. US floor trading was closed due to the Thanksgiving holiday.

Brent crude for January fell 66 cents to $71.92.

The Organization of the Petroleum Exporting Countries, which pumps out one-third of the world’s oil, opted to stick by its output target, even after prices have plunged by 35 percent since June.

The 12-nation cartel “decided to maintain the production level of 30 million barrels per day” where it has stood for three years, it said in a communique after a meeting Thursday at its headquarters in Vienna.

Oil prices were routed after the decision was announced, with WTI tanking to $67.75, a level last seen since May 2010, while Brent also plunged to a four-year low of $71.25.

“OPEC’s decision to keep output is the main reason for prices to drop quite rapidly,” said Daniel Ang, an investment analyst with Phillip Futures in Singapore.

“Prices are likely to be going down for the rest of the year,” he told AFP.

Ang, who closely tracks the oil market, said he expects WTI to end 2014 in the “low 60s” and Brent in the “mid-60s”.

At Thursday’s OPEC meeting, the cartel came under pressure from its poorer members, including Venezuela and Ecuador, to trim production as tumbling prices were eating into revenues and raising fears over their economies.

But the group’s powerful Gulf members led by kingpin Saudi Arabia resisted the calls to turn down the taps unless they are guaranteed market share, particularly in the United States, where cheap shale gas has contributed to the global supply glut.

– Energy firms take a hit –

Another member, Kuwait, supported the move with the country’s oil minister Ali Omair saying: “We decided that price will adjust itself based on supply and demand and that OPEC is supposed to safeguard its market share in order not to lose its clients.”

He suggested the United States should also bear responsibility and lower its own output of shale oil.

Venezuelan President Nicolas Maduro said on Thursday he would keep pushing OPEC to slash output.

“We have not succeeded yet, but… we will continue to try until prices return to where they should be, at around $100 per barrel,” he said in a televised address in his country, which depends on crude exports for nearly all of its hard currency revenues.

In Asia, energy stocks took a beating. US markets were closed for Thanksgiving.

Santos, one of Australia’s largest oil and gas producers, slumped 13 percent at the close of trade Friday and BHP Billiton was down 3.37 percent in Sydney, while Hong Kong-listed CNOOC was off 5.5 percent and PetroChina sank 3.33 percent.

However, Asian airlines — whose main cost is fuel — soared. In Hong Kong, Air China jumped 6.44 percent and Cathay Pacific gained 5.04 percent, while Tokyo-listed Japan Airlines added 5.28 percent and rival ANA jumped 7.39 percent.

Qantas gained 6.96 percent in Sydney and Korean Airlines was up 4.74 percent in Seoul. Singapore Airlines closed 2.57 percent.

Malaysian bank CIMB said a further decline in oil prices means Asian governments were unlikely to raise interest rates soon.

“Expectations of monetary policy tightening now gets further behind the line, as global reduction in inflation could only mean the urgency to hike or tighten monetary conditions becomes less of a concern for emerging Asia policy makers,” it said.

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OPEC Elects Diezani Alison-Madueke As President http://www.pmnewsnigeria.com/2014/11/27/opec-elects-diezani-alison-madueke-as-president/ http://www.pmnewsnigeria.com/2014/11/27/opec-elects-diezani-alison-madueke-as-president/#comments Thu, 27 Nov 2014 11:34:08 +0000 http://www.pmnewsnigeria.com/?p=220935 Ayorinde Oluokun/Abuja

Diezani Alison-Madueke, Nigeria  Petroleum Minister

Diezani Alison-Madueke, Nigeria
Petroleum Minister

The Organisation of the Petroleum Exporting Countries OPEC on Wednesday at its ongoing 166th Ordinary meeting elected, Nigeria’s Petroleum Minister, Mrs. Diezani Alison-Madueke as President.

She is the first female to be so elected in the 54 year history of the Organisation.

According to Wikipedia, Diezani (born 6 December 1960) became Nigeria’s minister of transportation on 26 July 2007. She was moved to Mines and Steel Development in 2008, and in April 2010 was appointed Minister of Petroleum Resources.

She was born in Port Harcourt, Rivers State, Nigeria. Her father was Chief Frederick Abiye Agama. She studied architecture in England and then at Howard University in the United States. She graduated from Howard with a Bachelor’s degree on 8 December 1992. She returned to Nigeria and joined Shell Petroleum Development Corporation that year. In 2002, she attended Cambridge University for her MBA. In April 2006, Shell appointed her its first female Executive Director in Nigeria.

Since 1999 she has been married to Admiral Allison Madueke (retired), one-time Chief of Naval Staff who was at various times governor of Imo and Anambra State.

In September 2011 Alison-Madueke was awarded an honorary Doctorate in Management Sciences by the Nigerian Defence Academy, Kaduna.
Diezani Alison-Madueke has held three significant positions in the Nigerian federal government. She was appointed Transport Minister in July 2007. On 23 December 2008, she was named as Minister of Mines and Steel Development.

After Vice-President Goodluck Jonathan became acting President in February 2010, he dissolved the cabinet on 17 March 2010, and swore in a new cabinet on 6 April 2010 with Alison-Madueke as Minister for Petroleum Resources. As Minister of Petroleum Resources, Alison-Madueke has pledged to transform Nigeria’s oil and gas industry so that all Nigerians benefit.

In April 2010, President Goodluck Jonathan signed the Nigerian Content Act, which aims to increase the percentage of petroleum industry contracts that are awarded to indigenous Nigerian businesses – a reaction to the domination of the sector by foreign operators.

One of the most controversial policies introduced under Alison-Madueke is the government’s plan to remove state subsidies on fuel prices. Alison-Madueke has supported the discontinuation of the subsidy on the grounds that it “poses a huge financial burden on the government, disproportionately benefits the wealthy, [and] encourages inefficiency, corruption and diversion of scarce public resources away from investment in critical infrastructure.”

Alison-Madueke is the first woman to hold the position of Minister of Petroleum Resources in Nigeria, and in October 2010 she became the first woman to head a country delegation at the annual OPEC conference. She was also the first female Minister of Transportation, and the first woman to be appointed to the board of Shell Petroleum Development Company Nigeria.[10] On the 27th of November, 2014 she got elected as the first female President of OPEC.

On working in male-dominated sectors, Alison-Madueke said she warned the young women she mentored while at Shell to “change their mode of thinking.”

In June 2008 Alison-Madueke was subject to a Senate probe after it emerged that as Transport Minister she had paid 30.9 billion naira ($263 million) to contractors between 26 and 31 December 2007. She is said to be worth over a billion naira . However, she has never been charged or tried for these allegations and has strongly denied any wrongdoing.

In September 2008 there was an unsuccessful attempt to kidnap Alison-Madueke at her house in Abuja.

In October 2009, the Senate of Nigeria indicted her and recommended prosecution for the alleged transfer of 1.2 billion naira into the private account of a toll company without due process and in breach of concession agreement. However, the allegations have never been taken to law, and the Minister maintains her innocence.

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Oil extends losses ahead of key OPEC meeting http://www.pmnewsnigeria.com/2014/11/27/oil-extends-losses-ahead-of-key-opec-meeting/ http://www.pmnewsnigeria.com/2014/11/27/oil-extends-losses-ahead-of-key-opec-meeting/#comments Thu, 27 Nov 2014 07:55:46 +0000 http://www.pmnewsnigeria.com/?p=220932 OPEC

OPEC

Oil prices retreated further in Asia Thursday on expectations the OPEC cartel will keep production at present levels despite pressure over falling prices at a key meeting later in the day, analysts said.

US benchmark West Texas Intermediate (WTI) for January delivery fell 89 cents to $72.80 while Brent crude for January was down $1.19 to $76.56 in afternoon trade.

WTI fell 40 cents in New York late Wednesday to its lowest closing point since September 2010. Brent eased 58 cents in London.

The 12-nation Organization of the Petroleum Exporting Countries will hold one of its toughest and most significant meetings in recent years in Vienna later Thursday, with members under pressure to address falling prices, which have sunk 30 per cent since June.

“All eyes are squarely on OPEC now. We suspect they will decide to keep to their current 30 million barrel-a-day production level,” David Lennox, resource analyst at Fat Prophets in Sydney, told AFP.

“They could make some token, insignificant cuts in production… OPEC has been inclined to surprises before,” he added.

Sanjeev Gupta, head of the Asia-Pacific oil and gas practice at business consultancy firm EY, said “in the absence of an announcement of a major cut… crude oil prices will continue to remain soft till the end of this year”.

Traders have been digesting a plethora of statements from petroleum ministers ahead of the OPEC meeting.

Saudi Oil Minister Ali al-Naimi was quoted saying he expects the oil market to “stabilise itself eventually,” a remark Dow Jones Newswires said suggested he did not see the need for major cuts.

Iran’s oil minister, Bijan Namdar Zanganeh, said his position was similar to Naimi’s, even as he expressed concerns about a glut.

“All the experts in the markets believe that we have an oversupply on the market and next year we will have more oversupply,” Zanganeh said.

OPEC’s poorer members, led by Venezuela and Ecuador, earlier have called publicly for a cut in output.

But the cartel’s Gulf members, led by kingpin Saudi Arabia, are rejecting such calls unless they are guaranteed market share in the highly competitive arena.

OPEC is currently pumping closer to 31 million barrels a day, or around 43 percent of global production, according to analysts.

“OPEC still controls a large chunk as a whole but as with any cartel, the test will be when prices are falling and members have to make sacrifices,” said Singapore’s United Overseas Bank.

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Shell Shuts Leaking Pipeline http://www.pmnewsnigeria.com/2014/11/25/shell-shuts-leaking-pipeline-3/ http://www.pmnewsnigeria.com/2014/11/25/shell-shuts-leaking-pipeline-3/#comments Tue, 25 Nov 2014 19:28:19 +0000 http://www.pmnewsnigeria.com/?p=220776 Shell Nigeria MD, Mutiu Sunmonu

Shell Nigeria MD, Mutiu Sunmonu

Nigeria’s oil exports were disrupted after Shell’s local unit shut a pipeline that carries a key grade after it discovered a leak on Saturday, the company said on Monday.

Reuters reports that the pipeline carries one of Nigeria’s main export grades, Bonny Light BFO-BON. About six cargoes of the crude are exported each month, or around 180,000-200,000 barrels per day.

A Shell spokeswoman in London said that force majeure had not been declared on the grade.

“SPDC is investigating the source of a leak at Okolo Launch in Eastern Niger Delta which occurred near the 24-inch and the 28-inch TNP (Trans-Niger Pipeline),” a spokesman at Shell’s Nigeria unit said in an e-mailed statement.

“The leak occurred near where one of our contractors was preparing to remove crude theft connections on the line…On noticing the leak on November 22, we deployed booms and also shut in the 28-inch TNP.”

The 24-inch pipeline has been shut since Oct. 18 last year for repair and integrity checks, the spokesman added.

Nigeria’s oil industry suffers from rampant oil theft. A report by a national conference convened by President Goodluck Jonathan in March, said the country was losing an estimated $35 million a day to oil theft.

In March this year, Shell said it lost nearly $1 billion in 2013 through theft and various disruptions to its Nigerian oil and gas operations.

The oil major has since sold some of its onshore producing fields in part due to these problems.

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Shell Shuts Leaking Pipeline http://www.pmnewsnigeria.com/2014/11/25/shell-shuts-leaking-pipeline-2/ http://www.pmnewsnigeria.com/2014/11/25/shell-shuts-leaking-pipeline-2/#comments Tue, 25 Nov 2014 14:06:09 +0000 http://www.pmnewsnigeria.com/?p=220755 Nigeria’s oil exports were disrupted after Shell’s local unit shut a pipeline that carries a key grade after it discovered a leak on Saturday, the company said on Monday.

Reuters reports that the pipeline carries one of Nigeria’s main export grades, Bonny Light BFO-BON. About six cargoes of the crude are exported each month, or around 180,000-200,000 barrels per day.

A Shell spokeswoman in London said that force majeure had not been declared on the grade.

“SPDC is investigating the source of a leak at Okolo Launch in Eastern Niger Delta which occurred near the 24-inch and the 28-inch TNP (Trans-Niger Pipeline),” a spokesman at Shell’s Nigeria unit said in an e-mailed statement.

“The leak occurred near where one of our contractors was preparing to remove crude theft connections on the line…On noticing the leak on November 22, we deployed booms and also shut in the 28-inch TNP.”

The 24-inch pipeline has been shut since Oct. 18 last year for repair and integrity checks, the spokesman added.

Nigeria’s oil industry suffers from rampant oil theft. A report by a national conference convened by President Goodluck Jonathan in March, said the country was losing an estimated $35 million a day to oil theft.

In March this year, Shell said it lost nearly $1 billion in 2013 through theft and various disruptions to its Nigerian oil and gas operations.

The oil major has since sold some of its onshore producing fields in part due to these problems.

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Oil prices nudge higher as OPEC meets to discuss cut http://www.pmnewsnigeria.com/2014/11/25/oil-prices-nudge-higher-as-opec-meets-to-discuss-cut/ http://www.pmnewsnigeria.com/2014/11/25/oil-prices-nudge-higher-as-opec-meets-to-discuss-cut/#comments Tue, 25 Nov 2014 13:00:04 +0000 http://www.pmnewsnigeria.com/?p=220739 Diezani Alison-Madueke, Nigeria  Petroleum Minister

Diezani Alison-Madueke, Nigeria
Petroleum Minister

Oil prices nudged higher Tuesday as many dealers bet that the OPEC cartel is unlikely to agree on any cuts at a key output meeting this week, analysts said.

In early afternoon trade, Brent North Sea crude for delivery in January rose 45 cents to $80.13 a barrel.

US benchmark West Texas Intermediate for January advanced 28 cents to $76.06 per barrel.

Oil investors are “speculating that OPEC will not be able to agree to any cut or even commitment to rein in excess oil production”, Singapore’s United Overseas Bank (UOB) said in a commentary.

The 12-nation Organization of the Petroleum Exporting Countries (OPEC) will hold one of its toughest meetings in recent years on Thursday, with members under pressure to address tumbling prices that have slashed their precious revenues.

“With many of the cartel’s members suffering a rapidly deteriorating balance sheet given the recent rout in Brent prices, all eyes will be firmly fixed on this OPEC meeting for any indication of members taking steps to address the fundamental picture” of supply and demand, said Sucden analyst Kash Kamal.

The oil market has tumbled 30 percent since June on the back of plentiful crude supplies, the stronger dollar, and growing doubts about global demand and economic growth.

OPEC’s poorer members, led by Venezuela and Ecuador, have called publicly for a cut in output, while Iran has also hinted at the need for a reduction.

But the cartel’s Gulf members, led by kingpin Saudi Arabia, are rejecting such calls unless they are guaranteed market share in the highly competitive arena, according to analysts.

Saudi Oil Minister Ali al-Naimi was silent about his government’s intentions Monday as he arrived in Vienna ahead of the OPEC gathering.

“Is this the first time we have oversupply?” he was quoted as saying by Dow Jones Newswires when questioned about current supply and demand.

However his Iraqi counterpart Adel Abdel Mahdi arrived in Vienna pushing for action, deeming the steep price drop “not acceptable”.

Dealers are also eyeing third-quarter gross domestic product (GDP) data from the United States to gauge demand in the world’s top crude consumer.

The data is likely to show the US economy grew at an annual rate of 3.8 percent in the July-September quarter, up from a previous estimate of 3.5 percent, according to Singapore lender UOB.

Daniel Ang, investment analyst at Phillip Futures, said positive US growth data will “give some support to crude prices, allowing them to inch up a little”.

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Crude Oil Crash: PENGASSAN wants politicians to cut unnecessary spending http://www.pmnewsnigeria.com/2014/11/18/crude-oil-crash-pengassan-wants-politicians-to-cut-unnecessary-spending/ http://www.pmnewsnigeria.com/2014/11/18/crude-oil-crash-pengassan-wants-politicians-to-cut-unnecessary-spending/#comments Tue, 18 Nov 2014 20:36:04 +0000 http://www.pmnewsnigeria.com/?p=220089 President Goodluck Jonathan of Nigeria

President Goodluck Jonathan of Nigeria

The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has advised political office holders and politicians to prune the number of aides working with them.

Comrade Francis Johnson, the President of the association, made the call in an interview with NAN in Abuja on Tuesday.

Johnson, who was reacting to the austerity measures announced by the Federal Government in response to the falling price of crude oil, the major revenue earner for the country, said such measure had become imperative to rescue the economy.

He said that a reduction in the number of aides was a more meaningful measure aimed at cutting cost rather than imposing “unnecessary’’ austerity measures on Nigerians.

“The huge number of political appointees as aides to the Presidency, the ministers, state governors and their commissioners is simply wasting national resources and putting pressure on the economy.’’

PENGASSAN also cautioned the Federal Ministry of Finance against stifling the economy through non-release of funds for development.

The union said it favoured tightening the noose around all avenues of leakage and wastage.

Instead of introducing austerity measures that would further impoverish and inflict more pains on the people, governments at all levels should consider reducing to the barest minimum the numbers of aides, Johnson said.

“If we are looking for ways to cut cost, I think the first place to focus is in the direction of reducing the number of Presidential aides from 133 to the barest minimum of about 20.

“The huge amount we spend in paying these aides can be used on developmental projects and boosting of the nation’s economy.

“The governors, ministers and federal and state legislators should also be made to reduce their aides to a sizeable number that our economy can bear and whatever is got from this exercise should be used in supporting and bolstering the economy.”

He also advised the government to develop other sectors along with the extractive and manufacturing sectors in order to diversify the national economy from its monolithic dependence on oil and gas.

According to him, it is only the development of other minerals, agriculture and the manufacturing sectors that will help Nigeria to escape the challenges posed by the dwindling global oil price.

The president noted that the price of oil was critical to the world economy, given that oil was the largest internationally traded good both in volume and value terms.

Oil Workers

“The dwindling oil price is now raising palpable fear due to the over dependence on oil and gas exports for over 90 per cent of our country’s foreign exchange earnings.”

He noted that the excess crude account created to cushion the economy at difficult times like this had been depleted.

The president attributed the oil price drop and its effects on the Nigerian economy to a number of factors, including the lack of foresight and strategic plan towards local refining and petrochemical activities.

“We do not have significant refining capacity and we spend crude oil earnings to import refined petroleum products for local consumptions.

“The four state-owned refineries are not able to meet our local demand for petroleum products due to some avoidable and unavoidable factors.

“These are crude oil theft, pipeline vandalism, lack of formidable legal framework such as the Petroleum Industry Bill (PIB), and huge importation of refined products.”

He, however, called on the government to do the needful by carrying out the Turn Around Maintenance (TAM)of refineries and ensure adequate and regular supply of crude to the existing refineries.

“The PIB which provides legal and regulatory frameworks as well as comprehensive guidelines for the operations and activities in the oil and gas sector is stuck in the National Assembly.

“There is the need for the legislators to consider the bill and not waste time in passing it into law, so as not to further delay or debar investment decisions that can spur development in the nation’s oil and gas sector.”

The union leader advocated for necessary incentives to facilitate the private sector investments in the upstream, midstream and downstream sectors of the oil and gas industry.

Also, Comrade Igwe Achese, the National President, Nigeria Union of Petroleum and Natural Gas Workers (NUPENG), said the austerity measures were not necessary.

Achese instead urged governments at all levels and the national Assembly to wake up to their responsibilities.

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WAPIC 2014: Elumelu wants Power Transmission Company‎ privatised http://www.pmnewsnigeria.com/2014/11/18/wapic-2014-elumelu-wants-power-transmission-company%e2%80%8e-privatised/ http://www.pmnewsnigeria.com/2014/11/18/wapic-2014-elumelu-wants-power-transmission-company%e2%80%8e-privatised/#comments Tue, 18 Nov 2014 20:04:22 +0000 http://www.pmnewsnigeria.com/?p=220060 By Simon Ateba

Sola David-Borha CEO, Stanbic IBTC Nigeria; Tony O. Elumelu, CON Chairman Heirs Holdings; Hon. Minister of Power Chinedu Nebo, OON;  and Kunle Elebute, Head of Advisory Services, KPMG Nigeria; at the West African Power Industry Convention (WAPIC) on Tuesday at Eko Hotel in Lagos

Sola David-Borha CEO, Stanbic IBTC Nigeria; Tony O. Elumelu, CON Chairman Heirs Holdings; Hon. Minister of Power Chinedu Nebo, OON; and Kunle Elebute, Head of Advisory Services, KPMG Nigeria; at the West African Power Industry Convention (WAPIC) on Tuesday at Eko Hotel in Lagos

‎Africa’s business leader and Chairman of Heirs Holdings, Tony Elumelu, said on Tuesday that Nigeria’s power transmission company is grossly inefficient and should be privatised.

The company loses an average of 40 per cent of power generated every day, Elumelu said citing the example of the Ughelli Power Plant.

He was speaking at the eleventh edition of the West African Power Industry Convention, WAPIC, holding in Lagos, western Nigeria.

In the case of the Ughelli Power Plant, he said, it operated at full capacity in July, generating 100 megawatts daily.

But because of the outdated transmission systems, for every 100MW generated and sent to ‎the transmission company, 40 per cent is lost, he said.

He listed the limited availability of gas as the second biggest problem undermining power generation business in Nigeria.

“Many plants in the country can produce more than they currently do, but limited availability ‎of gas makes it difficult to produce according the companies’ individual ‎capacities,” he said.

The third biggest problem, he added, is the inability of the Federal Government to pay power generating companies in timely manner.

This could slow down investments and discourage investors, he said.

Though he admitted that the Federal Government is addressing some of the issues, he called for the right regulations to be put in place.

‎He argued that Nigeria cannot develop without addressing its power problems, and explained that the private sector can drive the needed growth.

As he spoke, a power cut triggered a big laughter in the audience.

A cross section of participants

A cross section of participants

Nigeria’s Minister of Power, Prof. Chinedu Nebo, who declared the convention open, said ‎the meeting is timely as it is the first of its kind in the post privatisation period in the country.

In November 2013,‎ Nigeria handed over licences to six power generation companies, eleven power distribution companies and one power transmission company.

That privatisation exercise, the Minister said, has been adjudged globally as being ambitious and transparent.

He recalled that before the administration of President Goodluck Jonathan, the power infrastructure was in a state of inadequate maintenance and poor funding which created a wide gap between demand and supply of electricity.

The resultant effects, he said, were low generation, massive load shedding, voltage control problems, frequent system collapse and damaging image to the then National Electric Power Authority (NEPA).

“During this period, it was impossible to attract investment into many other sectors of the economy and worst of all private investors to participate in any power sector activities because of low Returns on Investment (ROI),” Nebo said.

‎But things have changed and the power sector is attracting investors, the Minister said.

He said the power sector in West Africa needs an estimated investment of $25 billion within the next 10 years in order to have an efficient, reliable and consistent power supply to the market.

He called on investors to make the needed investment in West Africa, saying that the African economy has tripled in its growth in the last 14 years.

“The International monetary Fund (IMF) has also made the forecast that 11 of the world’s 20 fastest growing economies will be in Africa by the year 2017,” Nebo said.

Governor Babatunde Fashola who sent a goodwill message read at the convention said his government is thrilled that WAPIC 2014 is ‎being held in Lagos.

“As a city, we are happy to have the infrastructure to support this ambitious and laudable event,” the governor said.

“As you visit groundbreaking projects scheduled as part of this event such as Eko Atlantic City and the Island Independent Power Project, we hope you are moved by the spirit of Lagos and it’s achievements, ” Fashola said.

Fashola mentioned his power development agenda initiated in 2010 with the implementation of the dedicated IPP for water supply located in Akute, the creation of the Ministry of Energy and Mineral resources in July 2011‎ and the existence of the Lagos State Electricity Board.

“Within the last four years, the board has implemented over 40MW of embedded independent power generation and has installed over 400 km of well-maintained streetlights across the city,” Fashola said without acknowledging that most of the streetlights have not been working for more than two years.

Prof. Thomas Akabzaa, Chief Director, Ministry of Energy and Petroleum, Ghana

Prof. Thomas Akabzaa, Chief Director, Ministry of Energy and Petroleum, Ghana

Prof. Thomas Akabzaa, Chief Director, Ministry of Energy and Petroleum Ghana disclosed that with a population of 24 million people, Ghana currently produces 3000 megawatts of electricity and is expecting to produce 5000 megawatts by 2016. He said 76 per cent of households in Ghana have access to electricity.

He refused to compare Nigeria, which produces 3500 megawatts of electricity with a population of 170 million to Ghana, saying only that the gas Nigeria supplies to Ghana to generate electricity does not always come.

Shi Wei Liang, ‎Vice President of Huawei West Africa, a leading global information and communications technology solutions provider, who delivered a keynote address, said the company has a wealth of experience and expertise in building better connected smart grids for electric power companies.

“Its products and solutions currently serve more than 160 electric power companies around the world, ” Liang said of Huawei.

The eleventh edition of WAPIC, which will end on Wednesday, has about 70 exhibitors‎, said Lida van Heerden, a marketing specialist at Spintelligent, the company organising the event.

She ‎said over a thousand people had registered to visit the event while over 390 delegates would attend the event.

Some of the exhibitors included, Vergokan, a cable support systems company, Elsewedy Electric, an Integrated Energy Solutions ‎Company, Indra, Debbas, General Cable and Etcon.

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World’s first oil well still bubbling crude oil http://www.pmnewsnigeria.com/2014/11/17/worlds-first-oil-well-still-bubbling-crude-oil/ http://www.pmnewsnigeria.com/2014/11/17/worlds-first-oil-well-still-bubbling-crude-oil/#comments Mon, 17 Nov 2014 03:47:05 +0000 http://www.pmnewsnigeria.com/?p=219886 by Stanislaw Waszak/AFP

A reconstruction of the hand operated driling rig from 1862 in the Ignacy Lukasiewicz Museum

A reconstruction of the hand operated driling rig from 1862 in the Ignacy Lukasiewicz Museum

The smell of money hangs thick in the air as black crude oil bubbles up from what is billed as the world’s oldest oil well, but this is not Texas or Saudi Arabia.

The sleepy village of Bobrka in southern Poland lays claim to the planet’s first oil well and rig, one that is still pumping up enough black gold to be profitable.

It was dug and built by hand in 1860 under the watchful gaze of Polish pharmacist and inventor Ignacy Lukasiewicz, a humble man who pioneered the now ubiquitous use of petroleum by creating the kerosene lamp.

Thanks to him, “Bobrka became the birthplace of the world’s oil industry”, says Barbara Olejarz, who runs a local museum devoted to the origins of the sector and whose last name by coincidence means “oilman” in Polish.

“It all began there,” she tells AFP while pointing a finger at an obelisk built by Lukasiewicz and his circle to mark the launch of the oil field in 1854 and the founding of the world’s first oil company.

Despite giving birth to the sector, it turned out that Poland did not have much oil.

It now produces around 20,000 barrels a day, or 7.3 million per year, worth some $584 million (466 million euros) at current prices — a trickle by global standards. Refined locally, Polish crude covers just four to five percent of domestic demand, according to oil and gas expert Andrzej Szczesniak.

The five remaining wells at the Bobkra museum pump out a combined 423 barrels of crude per year, which is also locally refined and consumed.

And though he pioneered the oil industry, few outside the country know about Lukasiewicz, due in part to his own humility.

A figure of Ignacy Lukasiewicz in his laboratory in the Ignacy Lukasiewicz Museum of Petroleum Industry

A figure of Ignacy Lukasiewicz in his laboratory in the Ignacy Lukasiewicz Museum of Petroleum Industry

“His modesty worked against him. He remained less known than other Polish scientists: Copernicus or Marie Sklodowska-Curie,” says Olejarz.

“He didn’t want to be the talk of the town, he didn’t like to stand out, he did everything during his lifetime so that he’d be forgotten and his wish has been fulfilled.”

– Kerosene –

Born in 1822 in the southern village of Zaduszniki — then part of the Austro-Hungarian Empire — Lukasiewicz acquired a pharmacist’s diploma and an interest in the petroleum found in the eastern Carpathian Mountains.

He ran experiment after experiment, sometimes triggering an accidental fire or explosion, before succeeding at refining crude oil and inventing the first kerosene lamp.

In 1853, he used it to light up the hospital in nearby Lviv, now part of Ukraine, and the following year he lit the world’s first kerosene lamp on a street in Gorlice.

Next up came the need to learn how to extract fuel from the ground in high volumes.

View of pipes at the Ignacy Lukasiewicz Museum of Petroleum Industry in Bobrka

View of pipes at the Ignacy Lukasiewicz Museum of Petroleum Industry in Bobrka

“In Bobrka, the first drillers were actually well-diggers who dug holes with pickaxes, shovels and hammers. The work was hard and dangerous,” says Olejarz, citing hazards including cave-ins, flooding and gas leaks.

She spoke in front of the wooden tripod that surrounds the Franek well, which is equipped with a cable pulley for pulling up buckets of oil.

– A Rockefeller –

By 1874, the Austro-Hungarian Empire had identified 111 wells and drilling sites in Bobrka. The deepest well went down 150 metres (490 feet).

The wells would be extended later thanks to new drilling technology, much of which was developed in the United States.

“Some say that one of the Rockefellers either came here himself or sent his associates to seek advice on how to obtain kerosene from crude oil,” says Olejarz, referring to the wealthy US family behind the company that became energy giant ExxonMobil.

“And Lukasiewicz told them everything.”

When the Rockefellers asked how much they owed him for the advice, he was said to have replied that it was free because he was working for the good of humanity — not for money.

“He was particularly modest, the archetypal nice guy, someone with passion,” says Joanna Kubit, principal of the petrochemical technical high school in the nearby town of Krosno.

“His idea was that the oil industry should above all serve to improve life in this poor province of Galicia,” the name of the region when it was an impoverished part of the Austro-Hungarian empire.

Sure enough, she says, the life of the region’s residents changed with the income generated by the sector and the considerable sums their wealthiest resident spent on public utility projects.

Lukasiewicz set up vocational schools, social insurance and municipal credit bureaus across the region. He also financed university scholarships, churches, convents and monasteries.

“It was said at the time that every road in Galicia was paved with Lukasiewicz’s money.

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OPEC to keep production ceiling at summit http://www.pmnewsnigeria.com/2014/11/16/opec-to-keep-production-ceiling-at-summit/ http://www.pmnewsnigeria.com/2014/11/16/opec-to-keep-production-ceiling-at-summit/#comments Sun, 16 Nov 2014 14:52:06 +0000 http://www.pmnewsnigeria.com/?p=219837 OPEC

OPEC

OPEC will keep its production ceiling steady at its “toughest ever” meeting this month, a former adviser to oil kingpin Saudi Arabia said as global crude prices hit a four-year low.

The 12-nation OPEC cartel, including the world’s biggest crude producer Saudi Arabia, will meet on November 27 in Vienna.

Mohammed Suroor al-Sabban, who until last year was chief adviser to the kingdom’s petroleum ministry, said the cartel’s talks will be “the toughest OPEC meeting ever as some OPEC ministers had not anticipated prices would drop to this level, and so quickly.”

He said he expected OPEC members to stick with the current output ceiling.

“In my personal opinion, the next meeting will confirm the current production ceiling… at 30 million barrels a day and OPEC will adhere to that in the coming period,” he told businessmen in the Saudi Red Sea city of Jeddah late Saturday.

OPEC nations currently produce around 600,000 barrels of oil a day over the output ceiling.

In early November, Riyadh sent global oil prices tumbling when it cut its price for crude on the US market while raising it for Asia, the country’s major outlet.

Analysts said that the kingdom wanted to strengthen its market share in the United States against a flood of oil being extracted there from shale rock, which had helped to create a global supply glut and lowered prices.

Oil rebounded slightly on Friday, with the US benchmark West Texas Intermediate for December delivery rising to $75.82 a barrel. Brent North Sea crude for delivery in January advanced to $79.41 in London.

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12 ships laden with petroleum products arrive in Lagos http://www.pmnewsnigeria.com/2014/11/15/12-ships-laden-with-petroleum-products-arrive-in-lagos/ http://www.pmnewsnigeria.com/2014/11/15/12-ships-laden-with-petroleum-products-arrive-in-lagos/#comments Sat, 15 Nov 2014 08:57:16 +0000 http://www.pmnewsnigeria.com/?p=219759 Nigerian Ports Authority

Nigerian Ports Authority

The Nigerian Ports Authority (NPA) said 12 ships laden with petroleum products had arrived in Lagos ports.

NPA stated this in its daily publication, Shipping Position, which was made available to newsmen in Lagos on Friday.

According to the document, eight of the 12 ships will discharge 262, 907 tonnes of petrol.

It said the four other ships contained base oil, diesel and kerosene.

The document said that 11 ships had also arrived with rice, buckwheat, containers and bulk fertiliser.

It added that 54 ships are expected at the ports from Nov. 14 to Dec. 3.

According to the document, 12 other ships are expected to sail into the ports with petroleum products, two of which contain bulk gas.

It said that 18 of the expected ships will arrive in the ports with containers, while 13 others would sail in with food items such as rice in bags, crude palm oil and bulk sugar.

The document said that nine ships will sail in with general cargoes, while two other ships will sail in with used vehicles.

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Slump In Oil Prices: A Progressive Way Out, By Bola Tinubu http://www.pmnewsnigeria.com/2014/11/14/slump-in-oil-prices-a-progressive-way-out-by-bola-tinubu/ http://www.pmnewsnigeria.com/2014/11/14/slump-in-oil-prices-a-progressive-way-out-by-bola-tinubu/#comments Fri, 14 Nov 2014 08:09:57 +0000 http://www.pmnewsnigeria.com/?p=219612 Opinion

Awash in the great tide of politics, we must not forget why politics can be a noble endeavor. It leads to governance when done correctly and governance can reform a nation and improve the lot of the people. In the hands of the ignorant and the mean, governance cast abundant misfortune upon a nation and upon the welfare of its citizens.

This commentary concerns governance and policy more than it does politics. I offer it to generate debate on an important economic issue. No matter who is in power, we must do whatever is in our capacity to steer the nation away from economic woe. The people have suffered too much hardship already. Neither side of the political divide should seek to purchase transient advantage at the high price of dousing the people in greater economic calamity. Thus, I suggest this progressive position on how best to shape economic policy during this period of falling oil prices. I state this hoping those in charge will take pertinent advice from any quarter. My prayer is that they are not so stubborn as to adhere to a strategy that will deepen the economic misery of our people even when better policy measures are proffered.

I confess to writing this also for a reason essentially political but non-confrontational. It accentuates the distinction between the conservative Peoples Democratic Party (PDP) and the progressive All Progressives Congress (APC). The nation faces momentous elections when next year turns to its second month. The choice is a stark one; but many people do not believe as such. The differences are vast especially regarding economic policy. On the one side, the PDP champions a conservative, elitist economic model based on the theory that wealth money must first go to the already rich and well-heeled who shall determine how small a fraction of it will trickle-down to the rest of society.

On the progressive side, we believe government can fillip economic growth and development in such a way that brings the fairness of prosperity to all of society. We don’t seek to penalize those who already have but we will do our utmost to remove from the clutch of poverty the bulk of our people. We seek to turn the hungry suffering of our poor and working classes into a dignified livelihood that provides a dignified existence for all.

Global oil prices have fallen from over 100 dollars a barrel to approximately 80 dollars per barrel. This slide has caused a corresponding drop in government’s dollar revenues. With this, the federal government claims it has less money at its disposal and the paucity of dollars necessitates austerity measures. Most people accept this position as gospel; debate about its correctness has been nil. Yet, the stakes are much too high to assume this subjective position as an economic certitude or uncritically accept its propriety. What they proclaim as policy is not based on any unassailable economic principle. It is statement of economic bias that beckons to the wealthy while auguring unnecessary hardship for most Nigerians.

Look at jobless and poverty levels as well as the diminished status of our middle class. After viewing these statistics, most objective economists would conclude Nigeria is mired in a long-term, secular depression. Forget the rosy GDP numbers. They signify a great economic and financial segregation between those who have and others who have not. If we continue with the policy preferences of the current administration, the haves shall become the “have–mores” and the “have-nots” shall become the “have even less.”

The vast majority of the claimed GDP growth has fallen into the laps of those already enjoying obvious luxury. The rest of the people are left to gaze at the enormity of the income and wealth chasm separating them from the cabal orchestrating the discordant political economy. While a small group flourishes, the rest of the nation subsidizes their economic bounty. A tight confederacy rides an economic skyrocket while the bulk of the people languish in the swamp. For one group, the economy is effervescent. For the other, it is catatonic. Nigeria is one nation with two economies.

For this government to speak of austerity is to further enrich the affluent while casting the average Nigerian into greater hardship and deeper socio-economic depression. As with the Euro zone the past five years since the global financial crisis, austerity has not solved the dire economic weakness of the nations that employed this sickening remedy. All austerity has done is tighten the grip of the wealthy on the economy while weakening the position of the middle class and the poor.

Asiwaju Bola Tinubu

Asiwaju Bola Tinubu

Austerity weakens aggregate demand, deflating an economy already fatigued and against the ropes. Those with hefty portfolios, profit as the value of their holdings appreciates by the very dynamics of deflation. Those who don’t have, find money even dearer to come by. Jobs and commerce disappear. Debt climbs. Deflation turns a noble but poor household into a committee of beggars and street urchins. The austerity that the current Administration offers is an insensitive, myopic policy that lends primacy of favor to meaningless accounting figures instead of to the material wellbeing of the people. Austerity undermines our economic pillars and breaks the spirit of the people. Austerity is the merchant of pessimism and hopeless futility. If you desire a nation of thralls, by all means continue this bleak path. If we want a nation of prosperity and economic justice, a different course is our due.

Listen carefully to the position of the Jonathan Administration as articulated by the finance minister and you shall collide into the barricades of illogic and its weighty consequences. The claim is that government is low on funds because the lower price of oil means fewer dollars are being collected from oil sales. This sounds logical but for one fundamental point. The dollar intake is basically irrelevant to determining the amount of naira the government commands and places into the political economy. This fundamental point reveals the government’s position to be the antiquated relic of a past era. It is the way of the gold standard which ceased to exist over forty years ago. As such, government’s stance is based more on superstition than on the actual functioning of modern economy with a sovereign fiat currency of its own.

The last I looked, Nigeria operates a Naira-based economy not a dollar-based one. There is no legal or moral restriction strictly limiting the amount of Naira in the system to match the amount of dollars collected via oil sales. More importantly, there is no economic justification for the close linkage implied by the government. If we take its position at face value, the Jonathan Administration is advocating that we effectively place the Naira and thus our fiscal policy on a “dollar standard.” The world jettisoned the gold standard in 1971 because it proved unworkable, reducing the policy space in which governments could pursue fiscal programs promoting full employment and social welfare. We should likewise reject this government’s imposition of a dollar standard on our nation’s fiscal operations.

Under the gold standard, a national government took pains not to incur budgetary deficits that exceeded the dimensions of its gold reserves. This was because the currency had no value by itself. Its value was based on the convention that the currency was backed by the nation’s gold holdings. Those governments that ran deficits had to pay those debts in gold. Given that gold supplies were always and everywhere finite and exhaustible, a nation had to keep its deficits within the confines of its ability to pay debts in gold. Because of this straitjacketing effect, nations would abandon the gold standard during harsh economic times in order to give them the fiscal freedom to rejuvenate their economies. This was the case during the Great Depression with the major economic powers. This should be the case with Nigeria today since the bulk of our people live in conditions redolent of the Great Depression or any other depression for that matter.

Our government persists that it must limit fiscal outlays to the amount of dollars the nation holds. Similar to the operation of the discarded gold standard, following this path is to strap ourselves to austerity and the chronic deflation of austerity produces. Worse, it serves to enthrall the fiscal policy of our sovereign nation to the monetary policy of another country. That nation plies monetary policy to serve its interests and not the economic interests of Nigeria. I am baffled why this government would give such power over the fate of our economic wellbeing to another nation that does not incorporate our interests into its decisional processes. This government makes our nation the economic servant of another so that government may turn about to make the Nigerian people its economic servant. While there is a certain logic to this dynamic, it is a perverse and debilitating one.

Because we operate a sovereign fiat currency the federal government issues at its sole discretion, the federal government can never be rendered insolvent in Naira. This means it can run Naira fiscal deficits indefinitely. The only outer bound is to ensure the fiscal expansion does not incur damaging inflation rates. There is no logical reason to peg the flow of Naira into the economy to the flow of dollars received. The correct perspective is not to mechanistically restrict Naira expenditure to dollar intake. This would be tantamount to those crippled with economic blinders forcefully leading those who can see we are heading for disaster. It points to deflation, recession and worse. The better methodology is to ascertain, then achieve, the level of Naira expenditure needed to expand the economy and create jobs without causing inflation to rise to dangerous levels. This is how broadly-shared prosperity is generated in a sustainable manner.

In this way, the nation’s economic engineers should focus primarily on allocating value and opportunity to our underutilized labor force and our idle, yet potentially productive capital in a way that promotes wealth creation and expansion of aggregate demand. It is this sustainment of aggregate demand that empowers the nation to rescue itself from the whirlpool of economic contraction. This avenue is more benign than the one the federal administration now advocates. Their way calls for us to forget growth and for government to preoccupy itself with allocating economic misery among those segments of the population too poor and weak to contest the immiserating actions of government against them.

In the face of recessionary headwinds, government should run countercyclical fiscal policy by using its Naira sovereignty to fund fiscal deficits. The deficit is not simply for the sake of running a deficit; the funds cannot be spent on nonproductive matters. It must be used to fuel infrastructural and other projects that not only employ great numbers of people but enhance the overall productivity of the economy. The funds must be used to backstop state governments in a nonpartisan manner so that each state government may continue to pay salaries and pursue projects essential to that state’s economic critical path.

To accomplish this, the federal government needs to reverse the inimical “dollarization” of the national economy in two ways. First and most importantly, it must abandon the outdated peg of fiscal policy and expenditures to the dollar intake. The one actually has no correspondent nexus to the other. Any commanding connection we give it is an artifice not an economic necessity. Related to this, we must reverse a trend that has gained momentum under this government. Among government-aligned elites, the fad has been to conduct domestic business transactions in dollars. Policy must “nairasize” the economy by requiring all domestic transactions occur in our legal tender. As this is done, the government’s infinite ability to issue Naira will come to outweigh the limitations inherent in the overuse of the finite supply of another nation’s currency for transactions wholly internal to our domestic economy.

Inflation is the major risk of running budget deficits to spur growth. We can contain inflation to acceptable levels by ensuring additional government expenditures are for items that can be supplied domestically, particularly labor. Naira paid to poor and working class people mostly circulates in the domestic economy, spurring additional local commerce and production. This is because their consumption patterns do not approach the level of import expenditures associated with their wealthier compatriots. Related to this, we must decrease our level of superfluous imports.

These measures will place downward pressure on the Naira. Devaluation will not be destructive but it will be noticeable. For most nations, such devaluation would be welcomed as it would make export industries more competitive, thus creating jobs and export earnings in the process. However, this will not be the case initially for us because of the moribund state of our industrial sector. Here, government would need to initiate crash programs aimed at enhancing those domestic industries perched on the borderline of international competitiveness.

In the end, the policy I propose is not without risks, inflation being the chief concern. Yet, if wisely prosecuted, the rewards of job creation and economic growth allocated among the bulk of the populace outweigh the inflationary risk. More to the point, the policy now pursued bears no risks at all. It is certain to toss the average man’s economy into a stagnation that will resemble the onset of a major recession. Saving the people from this unnecessary plight is sufficient imperative to eschew the policies of old and embrace the progressive course.

I offer this advice, this warning, because the people have suffered enough hardship. I offer this advice in the slim hope those in power will ignore the messenger and objectively weight the quality and humane nature of the message. If so, they will spare the people the grief visited upon a vulnerable people when their government blindly imposes last century’s policies in a modern setting inappropriate to the old strictures. Regardless of our partisan affiliations, let us consecrate this land by dedicating ourselves to the betterment of the poor, weak, and needy members of our national family. Let this moment not pass like so many others where we have demanded that the most vulnerable among us bear the greatest weight of the national burden. Let us give them the hope, change and dignity they deserve and human decency demands. This is how we make the nation great. When I speak of a common sense revolution, this is what I mean.

Written By Asiwaju Bola Tinubu, former Lagos State Governor and National Leader of the All Progressives Congress

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Court Papers  Expose Shell’s False Claims On Nigeria Oil Spills http://www.pmnewsnigeria.com/2014/11/13/court-papers-expose-shells-false-claims-on-nigeria-oil-spills/ http://www.pmnewsnigeria.com/2014/11/13/court-papers-expose-shells-false-claims-on-nigeria-oil-spills/#comments Thu, 13 Nov 2014 13:22:36 +0000 http://www.pmnewsnigeria.com/?p=219568 Court documents revealed by Amnesty International today expose the fact that Shell has repeatedly made false claims about the size and impact of two major oil spills at Bodo in Nigeria in an attempt to minimize its compensation payments. The documents also show that Shell has known for years that its pipelines in the Niger Delta were old and faulty.

The potential repercussions are that hundreds of thousands of people may have been denied or underpaid compensation based on similar underestimates of other spills.

The irrefutable evidence that Shell underestimated the Bodo spills emerged in a UK legal action brought by 15,000 people whose livelihoods were devastated by oil pollution in 2008. The court action has forced Shell to finally admit the company has underplayed the true magnitude of at least two spills and the extent of damage caused.

“Amnesty International firmly believes Shell knew the Bodo data were wrong. If it did not it was scandalously negligent – we repeatedly gave them evidence showing they had dramatically underestimated the spills,” said Audrey Gaughran, Director for Global Issues at Amnesty International.

“Shell has refused to engage with us and only now that they find themselves in a UK court have they been forced to come clean.”

Shell’s joint investigation report for the first oil spill in the Bodo area of the Niger Delta claims only 1,640 barrels of oil were spilt in total. However, based on an independent assessment published by US firm Accufacts Inc., Amnesty International calculated the total amount of oil spilt exceeded 100,000 barrels. Shell denied this and repeatedly defended its far lower figure.

In the court documents Shell admits its figure is wrong in both this case and a second spill, also in 2008, in the same area. The admission throws Shell’s assessment of hundreds of other Nigeria spills into doubt, as all spill investigations are conducted in the same manner.

“For years Shell has dictated the assessment of volume spilled and damage caused in spill investigation reports, now these reports aren’t worth the paper they’re written on,”said Audrey Gaughran.

“These spill investigation reports have cheated whole communities out of proper compensation.”

The reports, known as “Joint Investigation Visit” reports, decide whether a community gets any compensation and the amount they receive.  They also determine the extent of the clean-up required.

The people of Bodo have been able to take legal action in the UK. However, the vast majority of the hundreds of thousands of people in the Niger Delta who suffer oil spills from Shell’s operations will never have this opportunity to challenge the oil giant.

“Pollution from Shell’s operations has wrecked people’s homes, farms and fishing waters – their ability to send their children to school and put food on the table,” said Audrey Gaughran.

Shell’s admission makes clear the Joint Investigation Visit forms – which record the cause of the spills in addition to the volume and impact – cannot be used as credible sources of information.

“Shell will no doubt continue to defend its abysmal record in Nigeria by more misdirection, blaming spills on oil thieves. But the basis for these claims are the Joint Investigation Visit forms – which Shell must now admit are entirely unreliable,” said Audrey Gaughran.

The court documents also show for the first time that Shell knew for years that its oil pipelines were in very poor condition and likely to leak. The court papers include an internal memo by Shell based on a 2002 study that states “the remaining life of most of the [Shell] Oil Trunklines is more or less non-existent or short, while some sections contain major risk and hazard”.

In another internal document dated 10 December 2009 a Shell employee warns: “[the company] is corporately exposed as the pipelines in Ogoniland have not been maintained properly or integrity assessed for over 15 years”.

“It’s outrageous that Shell has continued to blame the vast majority of its spills on saboteurs while knowing full well how bad a state its pipelines were in,” said Audrey Gaughran.

“After these revelations, the company stands completely discredited.”

Shell has consistently maintained that for the first Bodo spill only 1,640 barrels of oil were spilt and for the second only 2,503 (approx. 4,000 barrels for both). This is based on what was recorded in the Joint Investigation Visit reports.  Amnesty International has repeatedly challenged Shell’s figures and supplied the company with photographic, satellite and video evidence showing that the data on the JIV reports for Bodo were incorrect.

Shell, however, has continued to defend its figures. For example in a letter to the UK Financial Times in March 2012 the Managing Director of Shell Nigeria “admitted liability for two spills of about 4,000 barrels in total, caused by operational failures”.

Responding specifically to evidence published by Amnesty International in 2012 which showed the first Bodo spill was under-estimated, Shell told the UK Guardian newspaper: “[The JIV] process … was employed with the two spills in question, and we stand by the findings [of 1,640 barrels].”

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Fayose laments poor power supply to Ekiti http://www.pmnewsnigeria.com/2014/11/12/fayose-laments-poor-power-supply-to-ekiti/ http://www.pmnewsnigeria.com/2014/11/12/fayose-laments-poor-power-supply-to-ekiti/#comments Wed, 12 Nov 2014 21:43:21 +0000 http://www.pmnewsnigeria.com/?p=219488 Governor Ayodele Fayose

Governor Ayodele Fayose

Governor Ayo Fayose of Ekiti State on Wednesday in Abuja said that protracted poor power supply to the state was militating against the economic and social growth of the state.

Fayose made the call during a courtesy visit on the Chairman of Nigerian Electricity Regulatory Commission (NERC), Dr Sam Amadi.

He, therefore, appealed to the commission to liaise with Benin Electricity Distribution Company (BEDC) whose operations cover the state to help in restoring power supply to the state.

Fayose said that most parts of the state had been in blackout for over 10 months. “Ekiti has been in blackout since I came in as governor. All that I want is a solution to the blackout that has persisted in the state,” he said.

According to him, some communities in the state have protested the continued blackout by destroying property and beating up workers of the electricity distribution company.

“Members of the communities have to block highways preventing people from going about their businesses but following my intervention they re-opened the roads,” he said.

Fayose said that as soon as he gets back to the state, he would redeem the pledge of N5 million he made to settle part of electricity bills owed by the communities.

He urged the commission to do everything within its powers to ensure that power was restored in the affected communities as soon as possible.

“If we leave the matter hanging, it may portend danger because there have been protests by the communities in recent times,” he said.

Responding, Amadi said that the blackout in parts of Ekiti state was as a result of hitches in the transmission process, adding that the commission was working out solutions to address the challenge.

“The case of Ekiti is as a result of failure in transmission,” he said.

He said that service providers had the obligation to provide consumers with quality service while the consumers on their part had the obligation to pay their bills promptly.

Amadi said that the commission would not encourage indiscriminate disconnection of consumers from power by distribution companies.

He assured Fayose that the commission would meet with the management of the BEDC to proffer solution to the problem.

An official of the BEDC, who spoke to NAN on condition of anonymity, said that repair work on the transmission line to Ekiti state was in progress.

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Oil prices linger amid OPEC output cut speculation http://www.pmnewsnigeria.com/2014/11/11/oil-prices-linger-amid-opec-output-cut-speculation/ http://www.pmnewsnigeria.com/2014/11/11/oil-prices-linger-amid-opec-output-cut-speculation/#comments Tue, 11 Nov 2014 21:08:51 +0000 http://www.pmnewsnigeria.com/?p=219362 OPEC

OPEC

Oil prices traded mixed Tuesday as the market gauged the outlook for an OPEC oil production cut amid abundant global supplies.

The benchmark US futures contract, West Texas Intermediate (WTI) for December, rose 54 cents to close at $77.94 a barrel on the New York Mercantile Exchange.

Brent North Sea for December shed 67 cents, settling at $81.67 a barrel in London, its lowest close since mid-October 2010.

Volumes were modest in New York as some traders were absent on the Veterans Day holiday.

Traders kept a close eye on OPEC members’ comments ahead of the cartel’s next meeting in Vienna on November 27, with dissent evident in the 12-nation group on the need for a production cutback.

“I hope that (oil) prices will not reach a level where they harm (the) national economy,” Kuwaiti Oil Minister Ali al-Omair told the official KUNA news agency on Tuesday. Oil income makes up around 94 percent of the country’s public revenues.

Omair attributed the slide in oil prices to oversupply and a weak global economy.

He said OPEC would discuss oil prices and “take appropriate decisions that serve the economic interests of its members” when they meet at the end of the month.

WTI had tumbled $1.25 in New York on Monday after he downplayed the likelihood of the 12-nation Organization of the Petroleum Exporting Countries cutting output.

A top Kuwaiti industry official said Tuesday that Kuwait plans more than $40 billion of investment to significantly increase its capacity to produce oil and gas

The Gulf nation aims to raise the amount of crude oil it can pump by one-quarter, to 4.0 million barrels per day, by 2020, the head of planning at state-owned Kuwait Oil Co., Mohammad Abduljalil, told the Al-Jarida newspaper.

OPEC, which pumps about a third of global crude, now produces nearly 31 million barrels per day, around one million barrels more than its official ceiling.

“Doubts regarding OPEC production policy continue to weigh on market sentiment with recent comments from OPEC officials providing little support,” said Tim Evans of Citi Futures.

The US Department of Energy’s closely watched weekly report on oil inventories, normally released on Wednesdays, will be published Thursday due to the Veterans Day holiday.

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Nigerian power sector to bag WAPIC award http://www.pmnewsnigeria.com/2014/11/10/nigerian-power-sector-to-bag-wapic-award/ http://www.pmnewsnigeria.com/2014/11/10/nigerian-power-sector-to-bag-wapic-award/#comments Mon, 10 Nov 2014 20:09:11 +0000 http://www.pmnewsnigeria.com/?p=219246 Minister of Power, Prof Chinedu Nebo

Minister of Power, Prof Chinedu Nebo

The West African Power Industry Convention (WAPIC) on Monday announced the nomination of Ughelli Power, Geometric Power and Clarke Energy for award for their key roles in the Nigeria’s power sector.

Known as West African Power Industry Awards, WAPIC said in a statement in Abuja that the award ceremony, which would be the first by the convention, would hold on 18 November in Lagos.

The statement by WAPIC’s Communications Manager, Ms Annemarie Roodbol, said that seven award categories, including Lifetime Achievement Award, Power Transaction of the Year and Outstanding Woman, would feature at the event.

It explained that the award was to celebrate “the heroes and success stories of the West African utility industry”.

“Together we are highlighting those companies and executives who have been responsible for pioneering new frontiers, pushing boundaries, for inspiring others and for achieving growth for West Africa,” it said.

The statement said that Lifetime Achievement Award would be won by an individual for his/her outstanding contribution to and impact on the West African power industry.

According to it, those shortlisted in this category are Dr Sam Amadi, Executive Chairman, Nigerian Electricity Regulatory Commission (NERC) and Gov. Babatunde Fashola of Lagos State.

Also on the list is former Minister of Power and currently, the Chief Executive Officer, Geometric Power Limited, Prof. Bert Nnaji.

It also said that the Managing Director, Geometric Power Limited, Mrs Agatha Nnaji and Minister of Finance, Dr Ngozi Okonjo-Iweala, were nominated for Outstanding Woman in Power award.

Also nominated in that category, according to the statement, is the General Manager, Ikeja Distribution Company, Mr Olubukola Osiberu.

It said that the event would be attended by leading executives from power, renewable energy, finance, and investment sectors.

“The WAPIC is organized by Spintelligent, a leading Cape Town-based trade exhibition and conference organiser and the African Office of Clarion Events Limited based in UK,” it explained.

Other categories are:

Best Rural Electrification Project

– Alternative Energy Inc, Liberia
– NewEnergy, Nigeria
– Solar Light Company, Ghana

Best Renewable Energy Project

– Ginphed, Nigeria
– O.T. Otis Engineering, Nigeria
– Quintas, Nigeria
– TopStep, Nigeria

Power Transaction of the Year

– Azura-Edo IPP (Siemens), Nigeria
– Clarke Energy, Nigeria
– Ughelli Power Plc, Nigeria

Excellence in Power Transmission or Distribution

– ABB, Nigeria
– O.T. Otis Engineering, Nigeria
– West African Power Pool, Benin

Excellence in Power Generation

– Clarke Energy, Nigeria
– Seven Energy, Nigeria
– Wärtsilä, Nigeria

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