Top Stories
ICPC
swoops on Imo LG Bureau Officials
By CHUKS EHIRIM, Abuja
THE game is up for corrupt officials of the Bureau of local government and
chieftaincy Affairs, the body that oversees the management and disbursement
of funds to local government councils in Imo State, as they are now chatting
with the...
Iwu
in fresh trouble
From CHUKS EHIRIM, Abuja
AS dust raised
by the controversial 2007 election are yet to settle, Chairman of the Independent
National Electoral Commission (INEC), Professor Maurice Iwu, appears headed
for yet another storm with....
Tribal
war looms in Cross River
CROSS River
is gradually on the edge of a precipice as the two dominant tribal groups,
the Efik and Atan, are deeply divided in a seeming war of political hegemony
in the State. This is believed not to be unconnected with the political colouration
that Liyel Imoke introduced during the brief period he was governor before
his...
Raymond
Obieri: Good to Great
By KELECHI DECA
“He
who sacrifices a whole offering shall be rewarded for a whole offering; he
who offers a burnt offering shall have the reward of a burnt offering; but
he who offers humility to God and man shall be rewarded with a reward...
Huawei Nigeria:The Innovative
Edge
By KELECHI DECA
IF you take
a good look at that CDMA cell phone is your hand or the desk phone on your
table, there is a surety it has a Huawei logo or name emblazoned on it. Almost
70% of all such...
NEWS
• Ohakim, Udenwa in cold war
• Seven UNIMAID students
arraigned for cultism
• Labour leader advocates
raise in NYSC members allowances
• Ibru
advocates capacity building among youths
• Seven
stores, eight houses razed
• New Law on House rent
for Enugu passed
• Yar'Adua commends NYSC
on nation building
• Okiro's friends donate
office complex to FUTO
• Wamakko orders N1.7b
rice for sale to public
• Ebonyi Radio GM, two others
charged with attempted murder
• ICPC blows own trumpent
• Media reports can jeopardize
national security –Army Commander
• NYSC member donates writing
materials to school
•Polio cripples 68 children
• Border clashes imminent
between C/River, Abia
• Four docked for alleged
armed robbery
• PDP chieftain rallies
support for Daniel
• NLC boss escapes lynching
• Court bars Speaker from
swearing in APGA candidate
• Fashola wants prisons
relocated from residential areas
• Lady Nyako tackles Girl-
child education
• Wamakko trains 25,000
unemployed youths
Niger
Delta crisis: FG goes tough
• Navy clamps down on militants •
Loss drops to 100,000 barrels per day • Goodluck unveils fresh strategy
• U.S. expresses concern
By OLUTAYO OLUBI
THE federal government may have woken up to the challenges facing the country's
oil industry. National Daily gathered that the Umaru Musa Yar'Adua's administration
has adopted a dual approach which it believed might bring a lasting solution
to the protracted crisis in the sector. The immediate approach entails the
use of force in order to secure the Niger-Delta region. Already, intelligence
report revealed that the Nigerian navy has increased patrols in the oil-rich
Niger Delta region to curb attacks by militants. The patrols have resulted
in fewer incidents of crude theft in the region. The losses hitherto placed
at 300,000 barrels a day has dropped to at least 100,000 barrels of oil per
day. National Daily gathered that a naval patrol killed an unspecified number
of militants, destroyed two boats and seized a third vessel following a clash
with unidentified gunmen along the Cawthorne Channel, near Port Harcourt.
Rear-Admiral Bodunrin Raji, the commander of the Nigerian navy in the region
informed that the eastern naval command's efforts are geared toward a secure
and peaceful maritime environment in line with Nigerian navy's role. Violence
in the oil-producing Niger Delta has cut more than 20 percent of the country's
oil production since 2006. Some of the armed groups say they are fighting
for a greater share of oil wealth for the region, whose inhabitants remain
impoverished.
The other approach entailed strategic policy formulation, and to this end,
the federal government has recently identified three key areas as strategic
consideration for the purpose of encouraging the exploration and production
growth of the nation's oil and gas industry. These areas, according to the
government, include funding, monestising gas resources and capacity building
through re-energised Nigerian Content development.
The Vice President, Dr. Goodluck Jonathan who is championing the new course
admitted that the nation's oil and gas industry is currently facing major
challenges and there is need for the government and the oil companies operating
in the nation's Upstream sector to come together and fashion out a modalities
that would encourage exploration growth.
According to Jonathan, funding is a critical requirement for sustainable growth
of the industry. He admitted that in recent times, it has been difficult for
federal government to meet its share of funding in the joint ventures through
budgetary allocation exclusively.
This, he said has severely limited the industry's ability to plan and executive
projects in a timely manner. "Given the capacity growth outlook and the
key the oil and gas industry has to play in enabling the Nigerian government's
aspiration to deliver unprecedented GDP growth, a more robust mechanism for
funding that is less sensitive to price volatility is being implemented as
part of the ongoing reform initiatives," Jonathan said.
The purpose, he said, is to maintain oil and gas industry expenditure at appropriate
levels consistent with the nation's aspirations in the oil and gas sector.
To this end, the national oil company, NNPC is, for the first time seeking
to raise external capital to meet its financial obligations to its JV partners.
So the concept of incorporating the joint ventures is another step in this
direction.
Speaking on the monetising gas resources issue, the vice president said, strategic
intervention and reforms have been introduced to enhance development and monetisation
of the nation's gas resources.
He added that this has been adequately documented in the National Master Plan,
which was recently rolled out to investors, locally and internationally. According
to him, "Already we have seen some rather innovative proposals such as
an integrated gas to petrol project being promoted by one of our joint venture
partners."
On the Nigerian content development, the vice president said, one of the cardinal
objectives of President Yar'adua administration is to rapidly improve core
and direct participation of Nigerians in the oil and gas industry especially,
because government's intent with the approval of the Nigerian Content Policy
in 2005. Besides, participation by indigenous companies and resources cut
across all segments of the value chain, including block allocation for exploration
and prospecting, marginal field development and operations, technical, logistics
services and fabrication services.
He, therefore, stated that the Federal Government is committed to tackling
and removing the barriers militating against sustaining quality local content
participation. "We believe that strict application of the Nigerian Content
policy and regulations and guidelines and a community content variant of this
policy will not eventually only result in cost and foreign exchange savings
but create jobs, deepen and expand the technological base and significantly
boost the oil and gas industry's contribution to GDP.
"Besides, we believe that the implementation of this policy will be greatly
facilitated by the timely passage of the Nigerian Content bill that is still
working its way through the National Assembly," the vice president said.
Speaking more on the major challenges facing the nation's oil and gas industry,
perhaps, most obvious is the complete uncertainty in crude oil price which
recently experienced unprecedented levels and the accompanying unexpected
and unprecedented volatility.
He said, "the root causes of which have become subject of sometimes acidic
debate in several global for a, between consuming and producing nations."
He said that the mean trading price of a barrel of crude oil in the last three
months of this year has been approximately $135, more than twice the $64 the
nation had this same time of last year.
While enumerating the obstacles that necessitated to high prices of crude
oil at the global market, the Jonathan said the uncertainties in prices have
been attributed to a broad variety of reasons ranging from demand and supply
imbalances occasioned by rapid expansion of emerging economies of India and
China in particular, to stretched refining capacity and speculation by commodity
traders, and the weakness of the U.S. dollar in which oil is generally priced,
against other currencies. Others are, perceptions about resource nationalisation
and security of supply, as well as, the impact of global and regional events
(post 9/11, security, uncertainty in the Middle East, Asia and the Niger Delta
crisis).
On the mitigating factors facing the Nigerian oil and gas sector, Jonathan
said, "in Nigeria, our consequent aspiration is to double daily crude
oil production capacity from 3.2 million barrel per day to 4 million bpd over
the next two years and progressively grow further thereafter."
He continued, "one of the obvious challenges that we face is how to realise
this ambitious target and at the same time achieve a zero-flare out policy
within the shortest possible time. Innovation will be at the heart of resolving
this tension," he said. The United States of America, USA, had earlier
warned that Nigeria faces the threat of a substantial loss in oil dollars
as a combination of factors have eroded the nation's revenue base and ability
to attract foreign investors.
Reports that the price of oil continues to dive and foreign buyers are seeking
for more reliable suppliers indicate leaner times for the country according
to the U.S. Labor Department. Officials said the loss of production because
of attacks in the delta could further reduce Nigeria's oil supply by about
30 percent and that a stronger dollar and weakening crude demand from China
have worsened Nigeria's revenue future.
The light sweet crude, Nigeria's main oil fell $1.45 to $113 a barrel in electronic
trading on the New York Mercantile Exchange and lost 75 cents overnight to
settle at $114.45, the lowest close for a floor session since May 1. And while
Nigeria continues to burn its natural gas through flaring, the demand for
heating and cooling gas rose and is expected to increase from 0.1 cent to
$8.35 per 1,000 cubic feet.
