By Etuka Sunday
The Nigerian National Petroleum Corporation (NNPC) has expressed its readiness to continuously work with the Nigerian Governors Forum (NGF) in order to grow crude oil production, renewable energy and generate more revenue for the country.
A release yesterday in Abuja by the corporation’s Group General Manager, Group Public Affairs Division, Mr. Ndu Ughamadu stated that the Group Managing Director of the corporation, Mallam Mele Kolo Kyari, made this commitment when the Chairman of the NGF, Dr. Kayode Fayemi, led the Governor of Sokoto State and the Forum’s Deputy Chairman, Rt. Hon. Aminu Waziri Tambuwal, on a business visit to the NNPC Towers in Abuja.
Mallam Kyari said the NNPC was ready to work for Nigerians through the efficient exploration and exploitation of the nation’s abundant hydrocarbon resources, noting that the NGF was an important and critical stakeholder to the successes of the corporation’s operations.
“It is our job to deliver value for the teeming population of this country. The NNPC has no excuse but to deliver on its mandate by touching the lives of Nigerians in many positive ways. We will ensure steady and unimpeded supply and distribution of petroleum products and we will also ensure that the NNPC remittances to the Federation Account Allocation Committee (FAAC) are enhanced,” Mallam Kyari assured.
He said NNPC’s operations would continue to drive the levers of production that would ensure steady generation of royalties and petroleum profit taxes from all its partners in the oil and gas value chain.
The NNPC’s helmsman stated that the corporation would work with the National Assembly and the NGF to ensure that appropriate legislations were put in place to guarantee a fiscal environment that would promote inflow of investment into the nation’s Petroleum Sector.
On transparency, Mallam Kyari assured that the financials and operations of the corporation would continue to be communicated to the NGF and that the NNPC would continue to engage the Forum to make the operations of the Oil and Gas Industry smooth in the country.
He said the NNPC would continue to work with the governors to enact appropriate legislations to mitigate incidences of pipeline vandalism, noting that adequate security of the corporation’s pipelines would go a long way to improving the nation’s revenue portfolio.
“We would promote partnership with the states in the area of renewable energy in line with our plan to transform into a competitive global integrated energy company,” Mallam Kyari said.
He added that the NNPC would continue to work with the Department of Petroleum Resources (DPR), the Federal Inland Revenue Services (FIRs) and all other revenue generating agencies of government to ensure fiscal feasibility for the states in consonance with the Medium Term Expenditure Framework (MTEF) enable good planning.
Earlier, Dr. Fayemi congratulated Mallam Kyari on his well-deserved appointment describing him as a true emblem of transparency following his active participation and belief in the principles of the Extractive Industries Transparency Initiative (EITI).
The Chairman of the NGF assured of the support of the 36 state governors, noting that they would continue to partner the NNPC and its leadership to deliver value to the Nigerian people.
“As governors at the sub-national level, we would continue to safeguard the NNPC’s pipelines as they run through our various states. We would partner and support the security agencies to mitigate the frequent infractions on the facilities of the corporation across the states,” Dr. Fayemi assured. company’s chief executive officer, Mr. Austin Avuru, gave an in-depth presentation on the company’s gas business to investors, sector and financial analysts during its 2019 Capital Markets Day at the London Stock Exchange, London, recently.
Seplat’s chief financial officer, Roger Brown’s Investor Relations team organised the forum to apprise investors of the company’s gas business with emphasis on the ANOH gas processing project.
In a presentation titled ‘Stability, Performance, Growth’ the team of six presenters provided the audience with comprehensive information on the company’s existing gas business, market outlook and anticipated ANOH growth trajectory. The ANOH gas processing project is managed by Anoh Gas Processing Company (AGPC), an incorporated joint venture (IJV) between Seplat and the Nigerian Gas Company. AGPC shall develop a 300 Mscfd midstream plant on OML 53 to process future wet gas production from the upstream unit.
During his introductory presentation, Avuru highlighted that the ANOH gas processing plant will be the first stand-alone midstream joint venture business between the Nigerian National petroleum Corporation (NNPC) and a company in the private sector.
With the ANOH project, Seplat aims to be the largest supplier of gas to the domestic market. The Seplat CEO added that: “By the time we commission the ANOH project, we will be able to produce 850 Mscfd.
“Overall, the gas business was not attractive in 2010 and some years after. Seplat however took a conscious decision to invest in the gas business upon the price of gas inching up as ‘willing buyer willing seller’ commercial terms became possible. The company is uniquely situated within existing gas pipeline network, and therefore leveraged on this to significantly expand its Oben gas plant. The revenues from the expanded Oben gas plant has been impressive motivating the company to seek further investment in gas.”
He explained that the company’s gas is for the domestic market, quipping that Nigeria has a notable population which is projected to continue to grow to 450 million people by 2050. “This will represent highest population growth in Africa, and Nigeria being the third most populated country globally behind China and India. Evidently, the current capacity for electricity generation cannot be adequate,” he said.
“Thus, Seplat has strategically positioned itself ahead of that opportunity and with projected demand for gas and improved fiscal regime, there is a compelling case for gas. Displacing diesel in Nigeria’s environment is a priority for the company. Currently Seplat gas accounts for 30 to 35 per cent of power generated and the company is determined to continue the lead in this area.”
“For Seplat, our gas business is a national project. As a result, facilitating gas to power and gas to industry have become critical for the company.
The Operations Director, Seplat, Mr. Effiong Okon, complimented the CEO’s discourse on the company’s gas business with insights on the Oben gas plant. He stressed that the successful delivery of Oben midstream plant expansion will be replicated at ANOH, pointing that as demand for gas continues to outstrip available supply, Seplat will continue to be strategically positioned to capitalise on future expansion of the gas business.
The General Manager, Seplat, Okey Mba, further highlighted the business case for the company’s gas business and demonstrated how the company would derive and deliver more benefits with its gas business.
He maintained that the economics of switching from diesel to gas fired power generation are compelling.
The Managing Director of AGPC, Yetunde Taiwo and the Project Manager Doug Kinloch, in separate interviews, provided comprehensive information on the ANOH project, highlighting project development overview, contracting and Local Content strategy, regulatory compliance, the commercial structure, community management and project execution schedule, amongst others.
The CFO, Roger Brown provided highlights on the funding structure showing that the company proactively is addressing debt investors and funding considerations upfront to ensure success of the project. He added that the company has received significant show of interest with major key stakeholders, both from international and local banks, amongst others.
Responding, some members of the audience commended the company on its foresight with its gas business.
The CEO in his closing remarks stated that: “The market gas price remains strong and the long term outlook for gas in Nigeria and the regional market remain strong. Seplat is participating in major national development with its gas business, and the company is delighted to, through its gas business, deliver major national priority while earning revenue.”