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Energy

FG to establish petroleum depot, oil and gas logistic centre in Akwa Ibom

The Minister announced approval for a partnership deal for the establishment of a petroleum depot by the NNPC.

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FG estimates that alternative petrol, CNG would cost N97 per litre, New PIB amends royalties by oil firms as Sylva clarifies position on scrapping of NNPC, autogas, FG to establish petroleum depot, oil and gas logistic centre in Akwa Ibom

The Federal Government has approved the establishment of Nigeria National Petroleum Corporation (NNPC), oil and gas logistic centre in Akwa Ibom.

According to a report from News Agency of Nigeria, the disclosure was made by the Minister of State for Petroleum Resources, Timipre Sylvia, at a gala night organized by the Akwa Ibom Government in honour of a delegation of Stakeholders in the oil and gas industry retreat in Uyo on Saturday.

He also announced approval for a partnership deal for the establishment of a petroleum depot by the NNPC.

While he said the Federal Government will partner with the state government to build a base which will be the first in Akwa Ibom, he also urged the governor to set up a team to work with the NNPC in drawing up modalities for the collaboration.

READ: Banks’ loans to private sector increase by N3.50 trillion in one year – CBN

Sylva said, ‘’I have the full support of NNPC to announce to you that we are very interested to partner you to build a base here. It will be the first here. It has also approved the immediate establishment of an oil and gas logistics facility in the state.’

He also noted that the visit was a response to Gov. Udom Emmanuel’s efforts in maintaining peace and security in the state.

Going further, the Minister said, ‘’Few concerns were raised on the choice of Akwa Ibom for our retreat, but politics was not part of the consideration. As we go back, work will start in earnest. Mr President has already helped by signing a free trade zone status for that area.

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READ: Why the $1.5 billion World Bank loan to Nigeria is being delayed

“We went all the way to Ibaka, a very interesting and painstaking journey. Some people in my team were excited because it was a rare experience using the boats.

On his part, the Akwa Ibom State Governor, Udom Emmanuel, while expressing his appreciation for the planned NNPC oil and gas logistics centre in the state, he also proposed that the groundbreaking be done in September to mark the state’s 33 years’ anniversary.

He disclosed that President Buhari approved a 50,000 hectares oil and gas free trade zone in Akwa Ibom.

READ: COVID-19: Take-off of Africa Free Trade Zone “AFCFTA” Postponed

Emmanuel urged the minister to partner the state for the 540 megawatts Qua Iboe Power Plant project.

He further used the occasion to push for the relocation of multinational oil giants, ExxonMobil to Akwa Ibom state, while assuring that the state is safe and peaceful for them.

Jaiz bank

The Governor said, “I want the Honourable Minister to make just a statement and ExxonMobil will be here. They are not safer where they are than in Akwa Ibom. Akwa Ibom is peaceful.’’

We are ready to support the relocation. ExxonMobil is a very difficult corporate citizen but the Minister can give them a directive to come here. They process over 15 billion barrel from our shores and that alone should propel them. They don’t have such excellent production anywhere else in the world.

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He also expressed his readiness to provide support ranging from land and electricity for an NNPC depot in the state.

Chike Olisah is a graduate of accountancy with over 15 years working experience in the financial service sector. He has worked in research and marketing departments of three top commercial banks. Chike is a senior member of the Nairametrics Editorial Team. You may contact him via his email- [email protected]

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Energy

FG committed to ending estimated electricity billing – Deputy Senate President

The Deputy Senate President has said that the FG is committed to increasing economic productivity through power.

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The Deputy Senate President, Ovie Omo-Agege has assured Nigerians that the federal government is committed to ending the era of estimated electricity billing, citing the mass metering programme initiated by the government.

The Senator disclosed this at the breaking ceremony of the Power Sub-Station in Orogun constructed by Niger Delta Power Holding Company (NDPHC) and National Integrated Power Project (NIPP), Ughellli North Local Government Area of Delta, on Saturday.

What the Senator said about ending mass metering

“I remind the Benin Electricity Distribution Company (BEDC) of its obligation to customers and the government regarding the mass metering initiative of the Federal Government aimed at ending the era of estimated billing syndrome,” he said.

“That is what President Muhammadu Buhari and members of the National Assembly want.

All over the world, you pay for the energy you consume. The only obligation government has is to provide the enabling environment for it to be made available,” Omo-Agege said.

READ: How to reduce your electricity bill in Lagos

He disclosed that the FG  will introduce more power-related policies when the implementation of the 2021 budget begins, as the FG is committed to increasing economic productivity through power.

“The objective has been to ensure that the number of people who use modern energy should increase to reduce social cost than to increase social benefits. The establishment of this power sub-station is one of the several initiatives of this administration aimed at addressing the energy poverty in our nation,” he added.

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READ: Buhari moves against DISCOs that collect money for prepaid meters

What you should know

Recall Nairametrics reported in March that the Central Bank of Nigeria (CBN) has disbursed N123.34 billion to Distribution Companies (DisCos) to boost electricity supply in the country for the procurement of meters and other equipment needed to improve power.

CBN disbursed N33.45 billion to nine DisCos for the procurement of 605,852 meters, while N89.89 billion was disbursed under the Nigerian Electricity Market Stabilisation Facility (NEMSF 2) to 11 DisCos to improve electricity supply in the country.

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Columnists

What FGN Free Meter Program means for the power sector

Without effective penalties for erring DisCos and consumers, progress may still remain very slow.

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Electricity, Buhari moves against Discos and agents that collect money for prepaid meters

According to news reports, the Minister of Power, Mamman Saleh on Wednesday said the distribution of the four million free electricity prepaid meters pledged by the Central Bank of Nigeria would soon begin across the country.

According to him, the government is wrapping up the distribution of its initial one million meters, which he labelled phase zero, and would soon begin the distribution of the four million sponsored by CBN, which he tagged phase two. He also noted that the Federal Executive Council approved N3bn for the execution of six major electricity projects in the country to upgrade Nigeria’s electricity facilities and improve power supply across the country.

Ineffective metering remains a major drawback to the success of power sector reforms in Nigeria. While some consumers avoid paying for power consumed through meter bypass, some other consumers are made to pay for what they have not consumed through estimated billing by DisCos.

DisCos have been largely unsuccessful with metering their customers.

As far as inadequate metering is concerned, DisCos over time, have used this situation to their advantage via estimated billings. It appears that fully metering customers are currently being viewed as a disincentive, given that estimated bills can easily be manipulated.

According to a report by the Nigerian Electricity Regulatory Commission (NERC), only 4,234,759 (40.27%) of the total customer population of 10,516,090 were metered as of 30 June 2020. Clearly, this validates the widely held view that there are a wide number of customers on estimated billing which gives room for illegal connection to the networks and in turn corrupt practices. NERC further revealed that only three out of 11 Electricity Distribution Companies in the country had metered more than 50% of electricity customers under their coverage areas as of June 2020.

Effective metering in our view is one step ahead in solving the myriad of problems embattling the Nigerian power sector. Though supposed to be unpaid for, many customers in a bid to avoid the bureaucracy associated with getting meters have paid to get their own meters. We believe the provision of meters to all end-use customers will go a long way in ameliorating the liquidity squeeze in the power sector whilst also providing cashflow to the DisCos for investment in equipment needed to evacuate unused electricity to consumers nationwide.

We laud the FG’s efforts at distributing meters freely to end-users, but we note that without effective penalties for erring DisCos and consumers, progress may still remain very slow.

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CSL Stockbrokers Limited, Lagos (CSLS) is a wholly owned subsidiary of FCMB Group Plc and is regulated by the Securities and Exchange Commission, Nigeria. CSLS is a member of the Nigerian Stock Exchange.

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