Oil & Energy

Strategising For Rivers Electricity Grid

Published

13 years ago

May 21, 2012

It is inexplicable that despite the
abundant sources and resources of energy at Nigeria’s disposal, it is still
difficult for the citizens to enjoy efficient power supply. About seven years,
after the Power Sector Reform Act 2005, we are yet to move to the point of
counting our benefits.

What baffles one most is that despite all
the efforts made by the Federal Government in this regard and the huge amount
sunk into the power sector to revamp it, there is no remarkable improvement. A
total of $16 billion has been poured for 10 years, yet the whole business is
stinking, not much has changed, sounding like a hoax every passing day.

It is the exclusive responsibility of the
federal government to give the people the opportunity to enjoy affordable and
accessible stable electricity. What the nation needs at this time are scores of
compact micro-schemes to deliver power off grid to take the hook off the inept
Power Holding Company of Nigeria (PHCN).

So, as the PHCN is warming up for
privatization before the end of this year, it is pertinent that state
governments and private investors take over the distribution and transmission
of electricity in Nigeria. There are gas, coal and water resources available
for exploit to the advantage of the power sector. Independent Power Projects
(IPP) will enable state governments deliver services that are so critical to
the welfare of the people.

It is high time we began to question the
reasoning behind retaining any monopoly in the value delivery chain which is a
negation of the liberal mantra of the present administration under President
Goodluck Jonathan. The Power Holding Company of Nigeria originally christened
Electricity Corporation of Nigeria (ECN) and later called the National
Electricity Power Authority (NEPA) has outlived its usefulness.

The corporation or organization is not
living up to its bidding both in distribution and transmission, so it is good
enough for privatisation. Current realities show that transmission suffers the auctioneers hammer.
There is a drastic and constant drop in the power supply ocean. Obviously, not
much has changed in the power scene, the chain remains as unreliable as ever.

The Rivers State Government during a press
conference in Port Harcourt recently called on the Federal Government to
dispose of its distribution aspect to the private sector operators so that they
can run them as business, bring in efficiency and make power available to our
people.

The Commissioner for Power, Hon. Augustine
Wokocha who addressed the conference said: “We are prepared, as a government to
invest into distribution despite the
fact that it is not part of our responsibility. People are tired of hearing
megawatts, megawatts, they want to see just one watt. The issue of power
distribution is the exclusive property of the Federal Government via the PHCN”.

According to him, the government’s
objective is to provide regular power for the people. “Our driving force is not
to make profit but for our people to make profit for themselves and the
improvement of the economy of the state to be independent and self-sustaining”.
The government, as he puts it, is acting as a catalyst to the industrial and
economic development of the state, noting, however, that it will partner with a
private sector outfit that will buy the generation aspect, of which discussion
is on-going.

The commissioner disclosed that the state
government is strategising itself towards creating own grid in the state such
that “all our generation will be on that grid and the power supply not from
one, generation point. However, he added
we are conscious of the fact that at the beginning, the demand will jump up, so
we are determined to establish a reasonable capacity and to ensure that other
Nigerians can enjoy what we are doing”.

He explained that for now, the Rivers State
Government has a sharing arrangement with the PHCN to the ratio of 70:30,
pointing out that the governor in 2008 had said that about N22 billion arose
from that agreement for which PHCN has not paid anything and it is running into
N100 billion by now. “The amount is based on what we have generated from the
70:30 formula and given to PHCN”. The government has 70 while PHCN takes 30.

On the way forward, Wokocha explained that
the state is not going to depend on the sharing any more as a modality for
power purchase agreement is being worked out whereby PHCN will buy what the
government is generating and pay for it.

Many states including Rivers State are
anxiously waiting for the whistle to blast for them to invest their resources
in power generation. But it is worthy of note that the situation where states
would invest their hard-earned money in power generation only to have the
output wheeled into the national grid by an arrogant Federal Government is not
encouraging.

Federal Government should allow states move
into the venture of power distribution and transmission if we are to have a
durable framework for captive power generation. From its four gas turbines, the
Rivers State government under the IPP has 180 megawatts of electricity and
hopes to increase if given the free hand.

Today, the Lagos State Government has
delivered the Akute Power Project – a 12 MW Plant dedicated to the state water
corporation with another IPP to deliver 15 MW in two phases to serve the
Central Lagos Business District on course, and many more which are off-grid
underway.

There are reports that limited gas supply
is one of the major challenges facing the eight gas turbines in the country –
NIPP Power Plant, Egbin Power Plant, Olorunsogo Plant, Alaoji Power Plant,
Ihovbor Power Plant, Calabar Power Plant, Gbarain Power Plant and Omotosho Power Plant. The 304
MGW installed capacity eight gas turbines power plants in the country built and
inaugurated about five years ago have practically packed up and six of them
broken down.

The issue of gas needs in this country is
one that the Federal Government has not given adequate thought. Until this matter is sorted out and
bound to impact the power sector, the problem of power shortage and outage
would continue to rear its ugly head. The issue of gas supply slow down the
operations of most of the turbines in the country.

In 2010, government’s efforts at improving
power supply got a boost with the commencement of gas supply to the PHCN
facilities. Pan Ocean Oil Corporation (POOC), operator of the NNPC Pan Ocean
Joint Venture commenced supply of gas to the Nigerian Gas Company (NGC) to be
conveyed eventually to PHCN power generating plants. It supplied 50 million
standard cubic feet per day (mmscf/d) of gas to the NGC from its Ovade-Osharefe
gas processing plant.

The flares out directive of the Federal
Government must be adhered to by oil and gas companies. With the gas processing
plants and pipelines which transverse the country, one would think that the
challenge of gas supply is no issue. Oando has so far expended more than N18
billion to develop a 128KM cross-country gas pipeline traversing Akwa Ibom and
Cross River States and has an installed capacity of 100 mmscfd of gas.

The move by the Federal Government
currently to facilitate the supply of gas to companies should be intensified
and implemented to the letter. A team is on a weeklong tour of gas
installations for this purpose. This will go a long way to actualise the hope
that 75 per cent of electricity can come out from natural gas. Nigeria has past
the stage of Kainji and shortage of gas to generate electricity. We have more
than enough gas resources for power generation, so the Federal Government must
be alive to its responsibility by ensuring that sufficient gas is supplied to
power our turbines at all levels.

If the Federal Government means that its
plans for improved power supply must
come to fruition, it must afford to compromise handing over the power busiess
to investors and be serious about the Power Agenda. It should ensure that
whoever gets the power generation, transmission and distribution assets must be
an investor who has the will-power to improve on it and not the type that would further resell to
another investor thereafter, thereby compounding the power problem being
suffered by the citizens. The new tariff billed to commence from June 1 should
be put on hold until the power supply improves.

Federal Government investment in power has
not been able to translate into stable power because of lack of accountability
but if the government had done the right thing to design a mechanism to restore
confidence in the power sector, a good result would have been recorded before
now. Statistics show that the power generation target set for 2011 was 5,000
Megawatts, achievement was 4420MW while target for 2012 was 6,000MW but has
crashed to 3200MW resulting in the sacking of some top officials of the PHCN
recently. The uncooperative attitude of some staff of PHCN reveals that there
are major threats to the actualisation of the new power reforms.

To ensure sufficient gas supply for our
power, not just international oil companies should participate in the gas
project of this country but also indigenous firms should be given priority
attention or consideration. Gas to power distribution is a boost the country
badly needs and there must be a corrupt-free national strategy for managing the
gas revenues because the worry about monies generated from the oil ad gas
sector in this country is the ‘course’ of embezzlement and misappropriation. We
must try to avoid the mistakes of the past. Nigeria is a democracy everybody is
watching, so it is expected that there is going to be improvement in the power
sector with the Power Road Map of the present administration. President
Jonathan should exert the political will to actualize the programme.

Our power sector needs a lot of gas, so
there should be concerted efforts to develop our gas resources as never done by
past administrations. Nigeria has large gas resources and so should subsidise
the product for easy reach and domestic consumption. Nigeria is adjudged the
world’s seventh largest producer of high grade gas with zero per cent surplus
and rich in natural gas liquids. It is a universal knowledge that no country
attains the status of industrialization without the impacting influence of
power supply.

Shedie Okpara

Oil & Energy

Hysteria Clashes with Missing Oil Barrels

Published

3 days ago

October 27, 2025

The Tide

A looming oil glut has taken over the energy commodities market as the dominating sentiment among traders and analysts. Everyone is predicting a glut—the only difference is in its size. But there is a fly in the bearish ointment. The IEA admitted this week that it was unable to account for 1.47 million barrels of supply.

The International Energy Agency deepened the glut mood last week, when it predicted a supply overhang of 2.35 million barrels daily for this year, and an all-time high surplus of 4 million barrels daily for 2026. In the same report, however, the IEA admitted it cannot place some 1.47 million barrels daily in global supply for August.

This is nothing abnormal in oil supply estimation, Reuters’ Ron Bousso noted in a report on the matter, but the size of the barrels that are unaccounted for casts a shadow over the accuracy of the IEA’s predictions. It suggests that in August, the global supply overhang may have been 1.47 million barrels daily larger than the IEA estimated or, then again, 1.47 million barrels daily smaller. The number for August gains even more significance in light of the fact that it is a sizable increase on earlier “missing barrel” estimates: 850,000 bpd for July and 370,000 bpd for the second quarter of the year, per Bousso, who cited IEA data.

While the IEA looks for the lost barrels, other agencies are updating their supply and demand forecasts for 2026—and prices just inched up because apparently some traders got fed up with the glut hysteria.

BloombergNEF, for instance, not known for its bullish tendencies, has revised its supply growth prediction for 2026 by 200,000 barrels daily for an oversupply size of 3.3 million barrels daily. For this year, the agency sees oversupply at 1.16 million barrels daily, which raises the question of how the prediction for 2026 would come true when gluts tend to push prices and drilling down, curbing output instead of boosting it twofold.

The U.S. Energy Information Administration expects a supply overhang of 1.9 million barrels daily this year, growing to 2.1 million barrels daily in 2026. The numbers are an upward revision of earlier forecasts for a 1.7-million-bpd surplus this year and a 1.6-million-bpd overhang for 2026.

Bloomberg, meanwhile, stoked the glut fire by reporting there were 1 billion barrels of crude oil on tankers at sea. The report noted this was oil in transit, meaning some of it, at least, is en route from seller to buyer, but the implication was that a lot of the oil was actually looking for a buyer in an oversupplied market.

“Crude cargoes from the Middle East are starting to go unsold and key price gauges signal that supply scarcity is ending,” Bloomberg wrote, which is an interesting point to make, seeing as there has not been talk about any sort of supply scarcity for months.

“For the last 12 months we’ve all known that there’s this surplus that’s coming,” Trafigura’s global head for oil, Ben Luckock, said earlier this month as quoted by Bloomberg. “I think it really is just about here now.”

“The most straightforward of economic concepts is driving this decline: There’s simply too much supply relative to how much the world is consuming,” analyst Rory Johnston from Commodity Context told the Financial Post.

The IEA, meanwhile, reported in its latest monthly update that in August, oil on water declined by 8 million bpd. It followed up with preliminary estimates that oil on water surged to 102 million over the next month. That would be quite a sudden buildup in oil in floating storage over a very short period of time and would perfectly justify preparations for a glut.

Oil prices, in the meantime, however, have ticked higher. One of the reasons seems to be that some market observers have developed something of a glut fatigue and are starting to doubt the predictions. As UBS’ Giovanni Staunovo wrote this week in a note, “While supply concerns have increased in recent weeks again, we believe the oil market is oversupplied but not in a glut.”

Concern about supply security from Russia also contributed to the latest in oil, suggesting that the supply overhang is not large enough, indeed, to leave traders cold to the news that a peace summit between the presidents of Russia and the United States had been put on hold. According to Reuters, U.S. pressure on Asian oil buyers from Russia had also contributed to the shift in oil supply sentiment.

Now, if the supply excess was as large as the IEA, the EIA, BloombergNEF, and Bloomberg proper, plus dozens of other forecasters have suggested, then the above developments in geopolitics would not have really mattered much for oil prices. The fact that they do suggests still existent sensitivity to supply disruptions, meaning the perception of a glut is a fragile one.

By: Irina Slav

Oil & Energy

Proffer Solutions To Energy Crisis, PTI Urges FG. Stakeholders

Published

3 days ago

October 27, 2025

The Tide

The Petroleum Training Institute (PTI), has urged stakeholders in the energy sector to proffer solutions to the country’s energy crisis.

PTI gave the urge at its 4th Biennial International Conference on Hydrocarbon Science and Technology (ICHST), organized in partnership with the Ministry of Petroleum Resources (MPR), Petroleum Technology Development Fund (PTDF), Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Nigerian Midstream and Downstream Petroleum Authority (NMDPRA), NNPC Academy, Nigerian Content Development and Monitoring Board (NCDMB), and CypherCrescent Ltd, held in Abuja, at the Weekend.

In a Communique issued shortly after the conference, by the Director, Research and Development, PTI, Dr. Tina Isichie, urged the nation to address its energy crisis with a sustainable solution.

The stakeholders noted that Nigeria is endowed with 207 trillion cubic feet reserves of gas aside from oil reserves that is sufficient to support development.

Isichie said, “Nigeria has been blessed with natural gas resources (currently a reserve of 207 TCF) in addition to oil. This is enough to support developments by leveraging digitalization, innovation, and technology across the board.

“It is projected that by the year 2050, Nigeria will be the 3rd most populous country on earth, necessitating an urgent need to think outside the box and proffer sustainable solutions to the country’s energy crisis.”

She said considering the government policy of 2020-2030 as the Decade of Gas, the government should speed up CNG investment and ensure all LPG importers set up processing plants in Nigeria so that the commodity will be readily available and at an affordable price.

According to her, despite the PIA 2021, persistent issues including under-utilized refineries, capacity gaps in the workforce, and challenges with technology transfer and environmental obligations have plaqued the sector.

The conference recommended that there should be a strong mandate for all Ministry of Petroleum Resources agencies to partner and collaborate on generating solutions and evolving the required technology for local production issues.

The conference, according to the communique, emphasised maximizing Nigeria’s 207 TCF gas reserves to drive national development, urging the acceleration of CNG investment and sector liberalization to diversify the economy into agriculture and ICT.

Isichie said there was a resolution to establish centres of excellence and foster collaboration between industry and academia to build a talented workforce prepared for the energy transition.

The Director stressed that transparency is the “currency of trust” needed to propel the sector, advocating for domestic participation and leveraging divestment to demonstrate local technical and financial capability.

Oil & Energy

Monarchs Task FG On Host Communities’ Welfare ………As PINL Targets 2000 Women For Empowerment

Published

3 days ago

October 27, 2025

The Tide

Monarchs of Host Communities have called on the federal government to place premium on the welfare of communities hosting oil pipelines.

This is even as the government records continuous increase in crude oil production output.

They lamented that the increase has not affected the lives of host communities

insisting that the deliberate consideration of the welfare of the communities would further enhance the safety of the oil pipelines and production output.

The monarchs, along the Eastern Corridor of the Trans Niger Pipeline ((TNP), made the call at the Stakeholders Engagement Meeting organised by the Pipeline Infrastructure Nigeria Limited (PINL) for its host communities of Rivers, Abia and Imo States, held in Port Harcourt, noted that lately the ……………

The Paramount Ruler of Emohua in Rivers State, His Majesty, Eze Sergeant Awuse, who led the call said “You have been announcing increased in production but are there improvement in the welfares of the people of the areas? How much improvement do we have?

“No amount of dramatisation here will give us peace if the government don’t look into the welfare of the area where these incomes are taken from. The well-being of our people are more important. This oil is our own.

“Every community would say those who are going to break the pipelines are from your community. How much more ability do we have as traditional rulers? How much power do we think we have?

“Pass our message to the government. Tell them it is time to not only put it into law and give authority to the traditional rulers but it’s time to implement it because if you don’t implement it nothing will happen”.

Also speaking, the Coordinator, Supreme Council of Ogoni Traditional Rulers, King Samuel Nnee, said people of the host communities deserve better dividends from the resources on their soil.

He decried the notion that traditional rulers are usually aware of the activities of suspected vandals in communities, urging the government and security agencies to level up in ensuring peace in the host communities.

In his words, “It has not been easy with traditional rulers because in our respective communities when you have bad boys they say we are responsible. When government want to confront traditional rulers or the evil deeds of our people, they say traditional rulers know all the people that are bad without thinking that the children- most of them, who are well educated; deserve the good things of life which government has refused to provide for them. So I want to say that the government should help our communities”.

On the responsibility to protect the pipelines and other critical assets, the monarch said Niger Delta kings need improved empowerment from the government at all levels to better perform that responsibility.

“I want to call on the agencies of government to care for the kings because we mean well for them. We’ll join you in this battle but if we are hungry we might not be able to do it more effectively.

” I want to urge the companies and government that the kings of the Niger Delta need a push to work better and then government will make progress, ” he added.

Nnee who commended the PINL for the recognition of traditional institution in their operations further called on the monarchs in the Niger Delta step up their primary function of protecting lives and all critical assets in their domain.

Speaking on behalf of the youths, the spokesperson, Coalition of Niger Delta Ethnic Youth Leaders, Comrade Legborsi Yamaabana, said lauded PINL’s mode of operations particularly in the monthly engagement of communities and relevant stakeholders.

Yamaabana attributed the company’s successes to its people oriented strategies, urging the government to give the company more responsibility.

“You are aware that production has surged, it didn’t happen as a mere coincidence, it happened as a result of concerted effort.

” So because this company has done well thus far, we’ll be calling on the government to give PINL more responsibilities because they have performed so that we’ll continue to enjoy the environmental protection we now have, ” Yamaabana said.

The Eze Ekpeye Logbo, King Kevin Anugwo, described as ‘competent’ the operations of PINL pointing out that the company has identified with the host communities which has resulted in maximum production output.

Represented by Dr Patricia Ogbonnaya, King Anugwo appealed to the Federal Government to retain the services of PINL saying “We want to appeal to the Federal Government that if they want these areas to grow, don’t replace PINL with another company.

” We are calling on the Federal Government that you (PINL) has delivered on the job and so it’s only natural and moral that you give more to them so that they can render more services”.

Earlier in his address, the General Manager, Community Relations and Stakeholders Engagement, PINL, Dr Akpos Mezeh, disclosed that the company has finalised plans to kick start the empowerment of 2000 women from the host communities.

Mezeh, said the program was focused on small business development, financial literacy, and skills training for women and girls in the host communities.

“Through the PINL Women’s Skills Development and Enterprise Program, 2,000 women are being targeted for empowerment before the year’s end.

“The PINL Women Entrepreneurs & Empowerment Initiative has completed data capturing, conducted in Port Harcourt for host communities in Abia, Imo, and Rivers States, and Yenagoa for Bayelsa communities. This program focuses on small business development, financial literacy, and skills training for women and girls. Verification of data had just been completed beneficiaries would soon be contacted”, he said.

Mezeh further revealed that scholarship programme for youths were being processed for payment, with beneficiaries expected to receive disbursements adding that new entries from underrepresented communities have also been added to the list.

On environmental and social impact support, Mezeh stated that PINL is partnering relevant government agencies and environmental experts on joint assessments to identify priority areas for remediation and social investment in the host communities.