Showing posts with label Niger Delta. Show all posts
Showing posts with label Niger Delta. Show all posts

Monday, 16 June 2014

NDDC’s defends 4,000 Uncompleted Projects

THE Niger Delta Development Commission, NDDC, is in a pitiable state it may never recover from, if it continues operating in its current ways. The 14-year-old interventionist agency, while defending its 2014 budget, claimed it had 4,000 uncompleted projects.

While this could have been said to elicit more funds for the commission, it portrayed NDDC as an organisation without focus. How could it have piled up 4,000 uncompleted projects – an average of 286 uncompleted projects per annum? Would these projects ever be completed?
According to its official website, “NDDC was established in 2000 with the mission of facilitating the rapid, even and sustainable development of the Niger Delta into a region that is economically prosperous, socially stable, ecologically regenerative and politically peaceful”.

Tuesday, 20 May 2014

Chief Beck Hitler commend Jonathan, Tompolo over Maritime varsity Okerenkoko, Gbaramatu Kingdom, Delta State

President Goodluck Jonathan and Chief Government Ekpemupolo alias Tompolo,  have been commended for the successful flag-off of Nigeria’s first Maritime University in Okerenkoko, Gbaramatu Kingdom, Delta State.

Wednesday, 26 February 2014

NEITI: Nigeria Loses $8bn Through Crude Oil Swaps


Nigeria may be losing an estimated $8 billion annually through the crude oil-for-refined products exchange arrangement, better known as crude oil swaps, which the Nigerian National Petroleum Corporation (NNPC) has with oil traders such as Trafigura, Vitol, Aiteo Energy Resources, Mercuria, Glencore, Taleveras Group Nigeria Limited, Sahara Energy Limited, Etena Oil and Gas Limited, Ontario Oil and Gas and Rahmaniya Oil and Gas.

Of the 445,000 barrels of crude oil per day brought by NNPC to meet its domestic crude refining capacity, slightly under 50 per cent is swapped with commodity traders in exchange for petroleum products which are imported into the country. The other 50 per cent is supposedly refined by NNPC’s refineries.

However, the state-run oil company has said contrary to claims by a Swiss-based non-governmental organisation (NGO), Berne Declaration, that 36 per cent of its crude oil is lifted by Vitol and Trafigura, both Swiss traders, account for 9 per cent of lift contracts.

The corporation also denied that the federal government lost $6.8 billion in oil revenue as a result of the oil swaps it has with Swiss-based companies listed in the NGO’s report, which prompted the probe instituted by the House of Representatives.

Speaking yesterday before an ad hoc committee set up by the House to investigate the allegations made by the Swiss NGO, the Group Managing Director of NNPC, Andrew Yakubu, said the oil corporation never sold crude oil to the firms at below market price as claimed by Berne Declaration in its report.

“By our records, Vitol and Trafigura account for 30.7 million barrels out of the total of 341.07 million barrels sold by the corporation in 2013 lifting. The lifting of Trafigura and Vitol in 2013 therefore represents 9 per cent of the total lifting as against 36 per cent reported by the Berne Declaration,” Yakubu explained to the committee chaired by Hon. Muraino Ajibola.

Instead of foreigners dominating the oil deals, the NNPC boss said more chances were given to Nigerian traders, who “collectively accounted for 98.2 million barrels during the same period, other international traders including the Swiss trading companies accounted for 61.2 million barrels, while offshore and the Nigerian refineries took 36.2 and 38.3 million barrels respectively.”

According to him, the selection of traders has standardised criteria, which evaluate buyers’ facilities, volume of transactions, turnover and financial health of the companies that is applicable to all, including Vitol and Trafigura.

He also added that the 2012/2013 term contracts had a preponderance of Nigerian trading companies with 23 out of the 40 regular buyers.

On the issue of NNPC colluding with Swiss-based traders to sell crude oil at below market price, Yakubu said: “Our pricing strategy is aligned to international best practices in the industry. Our prices are based on a reference to the benchmark crude Brent whose prices are published by Platts for the international trading community, a premium/differential for individual crude grades and the selection of an option.”

He further added that the average of five consecutive days' publications by Platts provides about 97 per cent of the value of any of its crude blends, while differential/premium account for about three  per cent of the total value.

“The differential/premium are established based on a wide range of publications (Platts, Argus, LOR, etc) and internal market assessment by the corporation for all crude grades.

“These processes apply to all buyers of Nigerian crude based on the terms prescribed in the General Sales Agreement entered by all parties. Overall, our assessment of the OSP (differential/premium) has matched or even exceeded the market value of Nigerian crude grade published by Platts, Argus and LOR, as exemplified in the following in the historical performance of the Bonny light since 2005,” he added.

Yakubu, who debunked the Berne Declaration report as “trying to portray NNPC in bad light”, said its claim that 100 per cent of Nigerian crude oil is sold through private traders was not true.

On the sale of unutilised crude oil at knockdown prices to Swiss companies through the crude oil-for-products exchange scheme (swap arrangement), Yakubu stated: “The NNPC Act mandates the corporation to supply petroleum products to the federation as supplier of last resort. In order to meet this obligation, 445,000 barrels of crude oil is assigned to the corporation at international price for domestic refining.

“The corporation disposes the unrefined portion of the assignment through direct exports or other secondary arrangements including swaps to ensure procurement and delivery of refined petroleum products,” he said.

However, despite the insistence by NNPC that no losses had been made from its crude oil swaps, it has come to the open that the federal government may have incurred losses of a staggering $8 billion annually as a result of the deals with Vitol and Trafigura, among other traders.

The ad hoc committee probing the alleged scam noted that in most cases, the foreign companies do not fulfill their own end of the bargain by refusing to supply refined products.

Documents given to journalists yesterday showed that NNPC allocated about 50 per cent of its 445,000 barrels of crude oil per day meant for domestic refining to the following companies – Vitol Limited, Trafigura, Mercuria, Glencore, Taleveras, Sahara Energy, Etena Oil and Gas, Aiteo Energy, Ontario Oil and Gas and Rahmaniya Oil and Gas.

In the process, $8 billion in under-delivered products from the crude oil swap arrangements has gone down the drain.

A report submitted to the committee by the Nigeria Extractive Industries Transparency Initiative (NEITI) also detailed how four of the oil traders “under-delivered” 500,075,239.3 litres of products in 2011.

They are: Trafigura (173,786,600 litres); Vitol (654,440.7 litres); Taleveras (152,308,878 litres); Aiteo Nigeria Limited (193,046,590 litres) and Ontario Oil and Gas (180,278,732 litres).

According to the report, Nigeria has lost revenue in billions of dollars, just as it also alleged that some of the oil-trading companies owed the NNPC products worth over $800 million.

The report also showed that Duke Oil Company, a trading subsidiary company of NNPC, was brought in as a middle player to protect some of the local companies used in the swap deals.

However, the NNPC during its presentation at the hearing, stated that the crude oil-for-refined products exchange agreement with Duke Oil Company started in February 1, 2011.

It said the Pipelines and Product Marketing Company (PPMC) allocates 90,000 barrels of crude oil to Duke Oil Company in exchange for the delivery of refined products equivalent to the value of the crude oil.

According to NNPC, Duke Oil Company operates and manages the swap arrangement by loading three cargoes through its nominated operators – Messrs Aiteo Energy Resources, Ontario Oil and Gas and Taleveras Group. Each company handles 30,000 barrels of crude oil per day.
The public hearing continues today.(THIS DAY)

Thursday, 5 September 2013


THE Movement for the Emancipation of the Niger Delta (MEND) has warned of yet another imminent Independence Day strike this year.
It is recalled that the group launched a strike on October 1, 2010, in Abuja, which claimed a couple of lives over which the acclaimed leader of the group, Henry Okah, now serves a jail term in South Africa.
The group, however, warned that it would launch a strike against a Chevron oil company’s tank farm in Escravos, Delta state, on Tuesday, October 1, warning workers on the facility to steer clear of the place.
Giving this warning in a statement circulated to the media in Port Harcourt on Wednesday night by its spokesperson, Jomo Gbomo, the MEND
Also affirmed that it had, through its ongoing operation, code-named ‘Hurricane Exodus’, continued to deal deadly blows to the oil production capacity of the company, adding that the activities of oil thieves in the region complimented its objectives.
“The Movement for the Emancipation of the Niger Delta (MEND is so far satisfied with the steady destructive progress of ‘Hurricane Exodus’ which has reduced Nigeria’s oil output significantly through our sustained sabotage of pipelines,” the statement read in part. 

“We will also continue to turn a blind eye to the crude oil merchants passing through our territories because their activities, apart from toll paid us, is helping to achieve our objectives of zero oil output by 2015.
“We use this medium to advice workers at the Chevron Tank Farm in Escravos to evacuate the premises as mortar attacks are imminent on Tuesday, October 01, 2013 from 00:01Hrs Nigerian time”, the statement said.

Friday, 16 August 2013

Niger Delta Amnesty Programme: 29 Pilots to Embark on Further Training at Lufthansa, UK - Kingsley Kuku

The amnesty programme of the federal government in the Niger Delta has boosted the technical manpower of the aviation industry with the training of 29 pilots who will now be further trained at the Luftahansa facility in Germany and CAE Academy in the United Kingdom to specialise in operating various aircraft. These 29 youths were trained under the Presidential Amnesty Programme (PAP) aspilots in South Africa and are to be ‘type’ rated at the Lufthansa Airlines facility in Frankfurt, and CAE Aviation facility in Oxford, UK. The Special Adviser to the President on Niger Delta and Chairman Presidential Amnesty Programme, Kingsley Kuku, disclosed this yesterday at a conference on ‘Oil Theft and Illegal Oil Bunkering in the Niger Delta’ in Lagos. He disclosed that the delegates had not only attained the Private Pilot Licence (PPL) but had also received their Commercial Pilot Licence (CPL),which would enable them to operate commercialairplanes. Kuku added that for these pilots to operate commercial airplanes competently, they would be going for type-rating programme in Lufthansa Airline and CAE Aviation facility. He expressed delight that the two aviation institutions had accepted to give the delegates type-rating training, urging them to take their training very seriously and to also make Nigeria proud. The Special Adviser urged the delegates not to be carried away by the success they had recorded so far admonishing them to redouble their efforts and performbetter than they did at the Afrika Union Aviation Academy and Flight Training Services in South Africa. Kuku also disclosed that some of the youths under the PAP programme were also undergoing pilot training in South Africa, Greece, Jordan and United Arab Emirate. On oil theft in the Niger Delta region, he noted that stealing of about 400,000 barrels of crude per day was an economic crime against Nigeria and had reached analarming proportion for full military actionand the collaboration of all stakeholders. While applauding the strides of the Navy and the Joint Task Force (JTF) in combating the scourge, he described the magnitude of the current oil theft in the region as “blood oil crisis” that can only be compared to the notorious Sierra Leonean “Blood Diamond.” Kukuu noted that at the rate the perpetrators were going, the nation could get to a point where the government would not be able to fund its activities. “If we get to a point of between 800,000 and one million barrels per day, it will ground the economy. What they are stealing is higher than Ghana’s total oil production,” he said, adding that two-third of global economies was not having anything close to what is being stolen to keep their countries going. He pointed out that unlike a force majeure where there was a shut-in of oil which was later recovered; “oil theft is an outright loss to criminal elements and their collaborators.” He advocated that such review should be done in a very transparent manner to enthrone a credible procurement process, adding that the most potent way of checking pipelines vandalism and oil theftwas to make Niger Delta indigenes actively involved in securing oil infrastructure as well as part owners of oil resources. “Nigerians must see oil theft as a war against Nigeria, and those behind it must be treated as economic criminals,” he said.