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We Will Provide Energy Today And Will Do Tomorrow, Says Mele Kyari

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We Will Provide Energy Today And Will Do Tomorrow, Says Mele Kyari

…As NNPC CEO, Malam Mele Kyari reiterates its commitment

…NNPC rebirth, end of fuel subsidy

Olushola Okunlade Writes

The Group Chief Executive Officer (Group CEO) of the Nigerian National Petroleum Corporation Limited (NNPC Ltd), Malam Mele Kyari has reassured Nigerians on providing energy that will serve today and tomorrow.

Mele Kyari made the statement via his Twitter handle page on Friday, July 29, 2022.

Kyari said, “We will provide Energy today and will do it tomorrow”. This has also necessitated him to unfold the Transparency, Accountability, and Performance Excellence (TAPE) Agenda for the corporation’s rebirth.

Mele Kyari’s global influence and visionary approach toward the oil and gas industry have demonstrated strategic thinking and innovative direction in shepherding the growth of Nigeria’s business and the wider oil and gas industry.

Mallam Mele Kyari, Group CEO NNPC Limited.

The phenomenal success of the Nigerian National Petroleum Corporation Limited (NNPC) can be attributed to its strategic management and leadership. He has been long known as an industry pioneer, contributing to the sustainable growth of Nigeria, and leaving an impact within the country and beyond.

Kyari’s appointment as the 19th Group CEO of the Nigerian National Petroleum Corporation by President Muhammadu Buhari on Monday, July 8, 2019, has taken the national oil company away from the image and shackles of a behemoth with a negative narrative and tag of a cesspool of corruption and opacity.

Three years on, he has seen and used his appointment as a lifetime opportunity and vista to break away from the decadent past to chart a course correction and a new direction that has renewed stakeholders’ hope.

Before his appointment, the Maiduguri-born Geology graduate from the University of Maiduguri, Bornu State, was the Group General Manager in charge of the Crude Oil Marketing Department (COMD) and had worked with the NNPC traversing the Nigerian oil and gas industry for more than three decades.

From a corporation that was still steeped in the negative image of a national oil company where nothing seemed to work on the assumption of office, Kyari has worked to tweak operations and make big positive things happen with his five-step strategic roadmap that has enthroned efficiency and global excellence.

His management team’s achievements include the AKK Pipeline Project, which is seen as the core of the country’s economic growth. Kyari has pursued the execution of the project with vigour and focused commitment to ensuring its 2023 completion deadline.

The executive management of the corporation played an important part to ensure the passage and signing of the epochal Passage of the Petroleum Industry Act (PIA) into Law by President Muhammadu Buhari on August 16, 2021.

President Buhari shocked his many detractors when, in a historic move, he signed into law the Petroleum Industry Bill (PIB) now the Petroleum Industry Act (PIA). This remains a major feat and one of the boldest, flagship executive actions by the Buhari administration. It was also a milestone accomplishment by the NNPC team under Kyari’s watch.

Under his leadership, he and his team Incorporated Nigerian National Petroleum Company Limited under CAMA on September 22, 2021, with the registration number: RC 1843987, and ensured uninterrupted fuel supply which was not experienced except for recent hiccups in the supply of petroleum products.

It is now a common feature, allowing people and businesses to plan more efficiently.

Kyari also positioned the NNPC ahead and built a strategic reserve of more than two billion liters of PMS the country could fall back on to overcome temporary shocks.

Under his sterling leadership, Kyari ensured NNPC engineers working with the National Engineering and Technical Company (NETCO), the engineering and technical subsidiary of the corporation, would be deeply involved in working with KBR, the original owners of the engineering technology for the refinery rehabilitation projects to handle the refineries’ rehabilitation program. Feasibility studies have already been completed for the construction of a condensate refinery, while the NNPC has given its commitment to sustaining seamless supply and distribution of petroleum products.

After the rehabilitation of the refineries, Kyari said the NNPC has agreed with the government to take away the management of the refineries from the bureaucracy and hand them over to private investors, as past experiences confirmed the government cannot handle business effectively.

Kyari has disclosed that the contract for the operation and management (O&M) of the rehabilitated refineries would be put up for bid by qualified professional managers to take over and manage. The essence of this is to erase the bureaucratic bottlenecks and ensure the refineries functioned more efficiently and transparently.

Under this falls the implementation of International Financial Reporting Standards (IFRS) 9, 15, and 16 across NNPC Group to ensure regulatory compliance.

He has also implemented the Centralized Invoice Processing System, integration of systems, applications, and products to Remitta, SAP Funds management, and issued conditions for financial autonomy of NNPC Special Business Units (SBUs.)

Kyari has automated NNPC’s operations by rolling out the SAP enterprise management software in performance management, procure to pay, and travel management to ensure an automated and integrated operational process.

He also inaugurated the NNPC Delivery Team charged with the responsibility of ensuring the effective performance tracking of the top five priorities across the business as well as launching the NNPC Code of Conduct and Tip Portal.

Leveraged on the existing Direct-Sales-Direct-Purchase (DSDP) product supply arrangement he started and sustained while in office as the GGM COMD of the NNPC, to guarantee energy security for Nigerians.

On the Final Investment Decision on the $3.6bn methanol plant in Bayelsa, the plant expected to produce 10, 000 tons of methanol daily is an integrated methanol and gas project in Odioma, Brass Island, Bayelsa State scheduled to commence operation in 2024.

The US$260m Funding Agreement for ANOH Gas Processing Company Limited (AGPC) can deliver 300 million standard cubic feet of gas per day and 1,200 megawatts of electricity to the domestic market.

He also launched the Nigerian Upstream Cost Optimization Programme (NUCOP) to reduce the cost of crude oil production in the country and ensure its continuing competitiveness in the global market, and award $1.5 billion contracts for the Rehabilitation of Port Harcourt Refinery to Tecnimont SPA of Italy. This has seen the Federal Executive Council (FEC) approve the sum of $1.48 billion for the rehabilitation of both Warri and Kaduna refineries.

The Commercialization of OML 143 Gas13 Execution of OML 118 (Bonga) Agreements between NNPC & Partner and Shareholder Agreement for Brass Petroleum Product Terminal (BPPT).

When completed, the BPPT will expectedly help close the infrastructure gap in the distribution of petroleum products and stabilize petroleum product prices in the riverine communities of the Niger Delta.

The Nigerian National Petroleum Company (NNPC) Limited has commenced the construction of a 50-megawatt gas turbine power plant, the Maiduguri Emergency Power Project (MEPP), expected to generate electricity for the capital city and its environs. The NNPC Limited had announced a plan for the gas-powered plant in April as a long-term solution to the incessant attacks and destruction of power lines by the Boko Haram insurgents, who had frustrated attempts to restore power to the beleaguered city.

He also published the NNPC 2020 Audited Financial Statement that posted N287 billion profit, the first such in 44 years.

On the construction/rehabilitation of 21 Roads under Federal Government’s Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme, the NNPC Limited, on Tuesday, 21st December 2021 handed over N621billion Cheque to the Federal Ministry of Works and Housing for the project.

Over the years at the 45-year-old behemoth, Kyari has laid the foundation on which others can build momentum and deliver greater value to stakeholders.

Established on April 1, 1977, as Nigeria’s national oil company, the NNPC has been living in the dark shadows of a cesspool of monumental corruption and opacity; a place perpetually lagging behind its peers in other climes; where nothing is done properly and efficiently to the benefit of its shareholders, which are the Nigerian people.

Kyari knew NNPC needed a new vista and a break away from its decadent past. He saw his appointment as an opportunity of a lifetime to give the NNPC a new direction in the way, its operations and businesses are well-conducted and give Nigerians renewed hope.

Days after his inauguration, the reform-minded oil, and gas industry technocrat unfolded an agenda for NNPC’s rebirth. He called it the Transparency, Accountability, and Performance Excellence (TAPE), a five-step strategic roadmap for NNPC’s attainment of efficiency and global excellence.

During the official unveiling of the TAPE agenda, Kyari said it was the only way to transform the NNPC and enhance its potential and capacity to compete with other national oil companies around the world.

He told members of the NNPC’s Management team to buckle up, shape up, ship in with the new direction, or ship out with the old ways of doing things and identified the five steps for realizing the objectives.

In his first 365 days at the helm of affairs at the NNPC, and as he resumes the next milestone of his tenure, stakeholders count his visible footprints of achievements across all segments of the country’s petroleum industry Upstream, Downstream, Gas & Power as well as his interventions in other sectors to give Nigerians a new lease.

Prior to Kyari’s appointment, the upstream sector of the country’s petroleum industry was facing a myriad of challenges and prices of international crude oil were experiencing a rapid decline.

Operations at oil mining lease (OML) 25, known as the Kula oil field, were shut down on August 11, 2017, following a dispute between Shell Petroleum Development Company (SPDC) and a local oil company, Belema Oil Producing Limited (BPL) over interests in the operations of the oil field in the Belema Community area.

But, Kyari played a vital role in the dialogue that restored normalcy in the area. Shortly after assuming office, he succeeded in mobilizing all the parties in the dispute to the table for a peaceful resolution of the dispute on September 17, 2019.

Today, all the lingering issues, including the traditional injunction that stopped oil production at the OML-25 oil flow station have been amicably resolved and removed following his intervention.

A proposal of a roadmap for the development of the community was presented to the federal government and the NNPC in a new global memorandum of understanding (GMoU) granting the Belema community the right to be involved in the maintenance and security of the oil facilities, while Shell remained the operator, along with the NPDC as its partner.

The OML 25 accounts for about 35,000 barrels of crude oil per day. The reopening of oil production activities in the area has been a major boost to NPDC’s output and Nigeria’s overall oil production capacity.

His intervention and dexterous resolution of all the conflicts that frustrated NPDC’s quest for increased oil production capacity repositioned the company to attain new peak output of 331,400 barrels per day on May 28, 2020. In the 2019 financial year, Kyari ensured the NPDC maintained a unit oil production cost of $16.5 per barrel per day.

Alternative Financing Deal For NPDC: Within the last year, Kyari ensured the execution of a funding and technical services agreement (FTSA) as well as an alternative financing deal for NPDC’s OML 13 valued at about $3.15 billion, and OML 65 for $876 million. These agreements resulted in a 32% and 21% incremental production output in OMLs 40 and 30.

14 companies participated in the auction for the financing and redevelopment of OML 119 operated by the NPDC. The twin offshore block comprises Okono and Okpoho fields located approximately 50 kilometers offshore south-eastern Niger Delta.

Revision Of Unit Costs for JVs, PSCs: Kyari has also saved costs for the government through NNPC’s revision of joint venture and production sharing contract (PSC) operators’ unit costs, down to $19 per barrel and $18.3 per barrel, from the initial $31 per barrel and $24.3 per barrel.

Concerned about the impact of high oil production costs on the government revenue, Kyari has, in the last year, demonstrated commitment to achieving the industry target of reducing oil production costs to an average of $10 per barrel by 2021.

Under Kyari’s management in the last year, the NPDC also acquired four new oil acreages (OMLs 11, 24, 116, and 98, while recovering debts for gas supplies totaling about N16.64 billion and $3.55 million.

In terms of gas development, Kyari has made significant progress in the development of an integrated gas handling facility, with the commissioning scheduled for the third quarter of this year.

Despite the challenges in the oil and gas industry, Kyari was able to ensure the NNPC subsidiary in charge of the government investment interests in the oil industry joint venture projects, the National Petroleum Investment Management Services (NAPIMS), was able to achieve an average oil production capacity of 1.8 million barrels per day prior to the recent decision by the Organization of Petroleum Exporting Countries (OPEC) to cut its members’ output to boost crude oil prices and stabilize the oil market.

Kyari has also supported NAPIMS to secure external funding for the SPDC’s Santolina 3 projects expected to deliver an average production of 16,300 barrels of oil per day, while also superintending on the resolution of the Escravos gas-to-liquids (EGTL) cost dispute with Chevron Nigeria Limited (CNL).

The settlement agreement is expected to bring in an additional $2 billion to the Federal Government in the next 20 years while providing about 1.5 million liters of diesel per day to the country.

He took steps to resolve the disputes that affected activities in other oil concessions. Following his intervention, the “signing of novation agreement between NPDC and the Nigerian Agip Oil Company (NAOC) involving the transfer of OMLs 60, 61 and 63 was formalized.

Nigeria LNG Train 7 FID: For almost two years, the final investment decision (FID) for the construction of Train 7 of the Nigeria LNG project was delayed, bringing things to a standstill.

When it seemed impossible at the height of the global pandemic, Kyari mobilised the NNPC and its JV partners, such as Shell, Total, and ENI, to execute the NLNG T7 FID on December 27, 2019. He went ahead to mobilize for the signing of the engineering, procurement, and construction (EPC) contract for the project awarded to the Saipem, Chiyoda, and Daewoo (SCD) JV Consortium.

The signing of the contract signaled the commencement of EPC activities for the NLNG T7 Project. On completion, the production capacity of the six-train plant would expand by 35 per cent, from 22 million tonnes per annum (MTPA) to 30 MTPA, and increase Nigeria’s competitiveness in the global LNG market.

The NLNG Train 7 project has the prospects of further attracting foreign direct investment (FDI) in excess of $10 billion to Nigeria.

The FID on NLNG T7 Project was a sobering moment and an important milestone achievement for Kyari because the FID confirmed that despite the downturn in the global economy, the partners in the projects were still willing and confident in Nigeria’s economy by agreeing to risk additional investment of over $10 billion after several postponements in the previous years.

Considered to be at the heart of the country’s economic growth, Kyari has pursued the execution of the project with a single-minded commitment to see that it is completed on schedule in 2023.

The pipeline project represents phase one of the 1,300-kilometre-long Trans-Nigerian Gas Pipeline (TNGP) project being developed as part of Nigeria’s Gas Master Plan to utilize the country’s surplus gas resources for power generation as well as for consumption by domestic customers.

The TNGP project also forms part of the proposed 4,401 kilometre-long Trans-Saharan Gas Pipeline (TSGP) to export natural gas to customers in the Completion of Power projects.

In the last year, Kyari has mobilized to ensure the completion of the second phase of the Okpai Power Plant, with the first and second turbines lined up for commissioning in the third quarter of this year to guarantee the supply of electricity to the national grid.

To ensure the sustenance of gas supply to power plants in the country and other domestic users leading to a peak energy capacity of 111,591.83 megawatts-hour attained, Kyari ensured the execution of a funding and technical services agreement (FTSA) with NPDC on OML 11, while taking the FID on the $3.5 billion West African Gas Project (WAGL).

In addition, Kyari has already ensured the successful execution of the intelligent pigging of the West African Gas Pipeline project as part of regulatory compliance and flow assurance, which is instrumental to achieving delivery of Nigeria-Gas foundation volume of 133 million BTU and cumulatively of more than 190 million BTU through the pipeline system this year.

Kyari has also ensured that the debts valued at over N80 billion and $45million owed the NNPC, through its subsidiary in charge of gas development and supply, the Nigerian Gas Company (NGC) by gas off-takers, were recovered.

2020 crude oil lifting contracts: In August 2019, a few weeks after his inauguration, Kyari announced the issuance of fresh crude oil lifting contracts to 15 local and international oil marketing and trading consortia/companies under the 2020 DSDP scheme.

With the country’s four refineries still operating far below their installed capacities, and unable to produce enough to meet the country’s daily national consumption need for petroleum products, the 15 contractors were to utilize the 445,000 barrels per day of crude oil allocation for local refining to bring into the country petroleum products for domestic consumers.

Kyari made a clear difference in the latest issuance of the oil lifting contracts as this was the first time since the DSDP program began in 2016 that the corporation would make public the list of all the contract winners.

Revealing the names of the beneficiaries to the public was a new normal for NNPC as part of the policy direction, pledge, and commitment of its management to transparency and accountability in NNPC’s operations going forward.

To sustain the era of uninterrupted supply of petroleum products, Kyari’s management team has continued to revamp downstream infrastructure to guarantee the availability of 90 per cent pipeline for fuel distribution; ensure automation of the fuel distribution system, and raise NNPC Retail market share to 30 per cent. “Operation White”.

To build on the success of the DSDP program, entrench energy security and deepen transparency in petroleum products supply and distribution, Kyari, in collaboration with the Minister of State for Petroleum Resources, Timipre Sylva, initiated an innovative program, “Operation White”, to curb products diversion and smuggling, and ensure that the entire country was kept continuously wet with petroleum products.

Under the initiative, a team of 89 officials drawn from various government agencies involved in the petroleum products supply process was inaugurated, tasked with the responsibility of monitoring and tracking fuel distribution and consumption throughout the country.

The team included representatives from the NNPC, Department of Petroleum Resources (DPR), Petroleum Products Pricing Regulatory Agency (PPPRA), Petroleum Equalization Fund (PEF) as well as the Department of State Security (DSS).

Under the initiative, Kyari ensured actual volumes of petroleum products imported and consumed in the country were authenticated. The NNPC now has a customer express solution and online marketers’ portal, which is a line for oil majors and Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) to monitor the loading and lifting of petroleum products from NNPC depots. Plans are on course for the system to go live for members of the Independent Petroleum Products Marketers Association of Nigeria (IPMAN) by the end of the second quarter of 2020.

Determining Nigeria’s National Daily Fuel Consumption: Mele Kyari wants to eliminate the situation where the Federal Government has not been able to determine the exact volume of petroleum products consumed daily in the country.

Various agencies have been presenting conflicting figures of the national fuel consumption volumes, ranging from about 35 million liters to 80 million liters per day. It was difficult to plan as a country.

Within a few weeks of the “Operation White” initiative, the team forced down the daily national consumption volume of premium motor spirit (PMS), popularly called petrol, from about 60 million liters to 52 million liters.

With the Federal Government’s border closure policy against its neighbors, NNPC curtailed the massive smuggling of petroleum products by unscrupulous elements across the Nigerian borders to other neighboring countries in the sub-region. Since then, the national average has been between 45 and 50 million liters per day.

Refineries’ Rehabilitation: At inception, Kyari promised to ensure that all the country’s four refineries at Port Harcourt, Warri, and Kaduna were fully rehabilitated by 2022, to transform Nigeria from being a net importer of refined petroleum products into a net exporter of the commodity.

Apart from encouraging private investors, like Dangote Group and other mini-refineries developers in the country to be involved in the construction of private refineries, Kyari ensured his agenda for the rehabilitation of the four refineries was on course.

The plan to undertake the rehabilitation of Phase 1 of Port Harcourt was to complement the supply of petroleum products from the strategic reserve.

Diversification Of NNPC’s Portfolio: Unlike most of its peers around the world, Kyari said the NNPC has for too long focused its operations on a single business line exploration and production of oil.

Despite the abundant natural gas reserves in the country, the huge volume being produced by the oil companies is only through accidental encounters in the course of oil production. There is no deliberate policy or program by the government to harness the gas resources to contribute to the economic development efforts of the country.

Kyari is repositioning NNPC Limited with plans to expand its activities beyond its traditional operations to other unexplored frontiers, grow its revenue streams, and cushion the impact of the volatility in the international crude oil market. This has seen the NNPC Retail Limited launch its range of lubricants into the Nigerian product market.

Kyari still wants the NNPC to continue to encourage the use of liquefied petroleum gas (LPG), otherwise known as cooking gas, among Nigerians in their domestic activities.

Finance & Accounts/Other Achievements: Breaking 43 years Jinx with NNPC’s Audited Accounts. On assumption of office, Kyari promised the NNPC would embrace openness, transparency, and accountability in his management approach. Despite pressures to dissuade him from opening up the system and breaking from the norm, Kyari kept his promise. He approved the regular publication of the Monthly Financial and Operational Report of the NNPC that highlighted NNPC activities in the different aspects of the industry. Since 2016, the publication has been sustained.

Again, in 43 years of NNPC’s existence, its management was never able to release to the general public the audited financial statements and accounts of all its strategic business units (SBUs) and Corporate Services Units (CSUs). The best that has usually happened was the submission of limited copies of such reports in highly confidential covers for the files of some restricted government institutions, like the National Assembly.

Timely Remittance Of Oil Revenues To FAAC: But, under Kyari, NNPC has always ensured timely and regular remittances of all revenues accruable to the Federation Accounts Allocation Committee (FAAC) for distribution to the three tiers of government.

On revenue optimization, Kyari made it a policy of his management to ensure revenue optimization by the NNPC in all its activities.

In all NNPC’s projects, Kyari has always ensured all JV partners adhered strictly to efficient operational processes established by the NNPC under his management, to achieve cost conservation and allow the NNPC to deliver its business objectives at such low costs and reduced budgets, to guarantee steady revenue flows to the federation account.

Alternative Funding Arrangements: Kyari has secured several alternative funding mechanisms and financing deals for the NNPC and its partners, to save the government the headache of cash calls for oil and gas industry projects.

One of such has seen Kyari secure about $3.15billion in funding for NPDC’s OML 13; $876 million for OML 65, and $3.4 billion for OML 11. Besides, Kyari has also concluded the necessary processes for a $1.8 billion financing for the AKK pipeline project as well as executed a term sheet with the Bank of China to raise escrowed $519 million from internal cash flows to support equity funding of oil and gas industry projects in the country.

He also achieved financial closure for Project Eagle’ by raising $1billion for the NPDC through a Forward Sale Agreement (FSA), while also negotiating a term sheet with AFREXIMBANK for the $1billion funding for the Port Harcourt Refinery and Petrochemical Company (PHRC) rehabilitation project.

Recruitment Of Graduate Trainees: Kyari has implemented NNPC’s People Strategy to address organizational optimization, resourcing, capacity development, retention, succession planning, compensation, and rewards by recruiting onboarding, and integrating 1,050 fresh graduates into various departments of the NNPC operations.

End to Fuel Subsidy: For years, the Federal Government lost to fuel subsidies several billions of Naira that could have been used to provide other basic infrastructures for the people, like roads, hospitals, schools, and other social amenities.

Each time any attempt was made towards the removal of subsidy by the government from the fuel pricing template of the PPPRA, there was stiff resistance by the Nigeria Labour Congress (NLC) and other categories of Nigerians, who always threatened to embark on nationwide strikes capable of crippling the country’s economy.

Highest Oil Output Despite Challenges: As of December when the Federal Government approved the 2020 Federal Budget, the crude oil benchmark price was put at about $57 per barrel. But, by April, within a few months of the outbreak of the coronavirus pandemic, the price dropped to an all-time low level of less than $12 per barrel.

Despite the impact of the coronavirus pandemic, which ravaged the global economy and impacted the international oil market, Kyari said the NNPC achieved the best performance during the crisis period.

This was made possible with the deployment of the latest technology under NNPC’s Business Continuity Plan activated during the crisis period to connect with its partners’ locations to sustain operations across the business value chain, despite disruptions and slowed-down economic activities.

“What the NNPC did was to engage with its partners to bring down the high cost. We negotiated contracts, cut down on the contract’s life cycle; select the right projects; engaged the right institutions to bring down the cost. Our ultimate target is to bring the cost to at most $10 per barrel,” Kyari said.

As the Nigerian National Representative to the Organization of Petroleum Exporting Countries (OPEC), Kyari joined other members of the group to seek solutions to the declining crude oil prices, which appeared to have impacted more on Nigeria, whose economy depended on more than 8o per cent oil revenues.

Kyari and the Minister of State for Petroleum Resources, Timipre Sylva joined OPEC to resolve a program to cut the crude oil output of its members by about 10 million barrels between May 2020 and April 2022.

However, Kyari said after the OPEC+ output cut program in April 2022, NNPC’s target is to raise Nigeria’s oil production from 1.579 million barrels per day to 3 million barrels per day and a national oil reserve of about 35 and 40 billion barrels.

Kyari said NNPC has projects already in line to come on stream between 2021 and 2022 to bring incremental crude oil production volumes in excess of 600,000 barrels per day.

Reviving Moribund Subsidiaries: Apart from the diversification of the portfolios of its investment to create wealth, Kyari said NNPC is pursuing its drive towards profitability, by reviving its moribund subsidiaries and providing the building blocks for stronger strategic business units (SBUs) and Corporate Services Units (CSUs) to rake in more revenue to support the overall growth of the corporation.

Over the years, some of the SBUs remained largely financially dependent on the support from their parent company and were hardly able to meet their obligations towards the discharge of their mandates.

For instance, the IDSL in Benin, which is supposed to be responsible for all the seismic data the NNPC requires in its oil and gas exploration activities, and its technical and engineering arm, NETCO in Lagos, which was supposed to make the technical and engineering inputs were all dormant for years.

But, since Kyari came to office, the two entities have not only been revamped and made to stand on their feet, they are now operating profitably and involved fully in the performance of their official functions in support of the entire NNPC business chain.

In the last year, IDSL achieved 20% year-on-year revenue growth and completed eight reservoir studies alongside the upgrade of IDSL’s Data Processing Centre.

Also, IDSL has obtained an Integrated Management System (IMS) Certification in ISO 14001:2015 (EMS), ISO 9001:2015 (QMS), and ISO 45001: 2018 (OH&SMS), while NETCO executed 729,771 man-hours against a plan of 660,000; which is 11% above plan. Revenue performance from the agencies as shown in the NNPC audited actual plan about N38.05billion and N25.77billion respectively, which is 48% above the plan.

Oil Drilling in Kolmani River 11: For several years, the search for oil by the NNPC in the country’s inland sedimentary basins, particularly in the northern part, did not result in any successful commercial oil discovery, despite the huge resources deployed by the Federal Government into the exercise.

Kyari said during the year the NNPC discovered hydrocarbon deposits in commercial volumes in the Kolmani River II Well on the Upper Benue Trough, Gongola Basin, in the North Eastern part of the country.

The oil well was to evaluate Shell Nigeria Exploration and Production Company (SNEPCo) Kolmani River 1 Well Discovery of 33 BCF and explore deeper levels.

Kyari said the discovery of oil and gas in commercial quantities in the Gongola Basin would attract foreign investment, generate employment for people to earn income, and increase government revenues.

Benchmark For Legal Arbitration: Over the years, the NNPC has been spending a huge fortune on legal fees to defend itself against several litigations against foreign interests around the world.

When Kyari assumed office, the NNPC had an arbitration case over a failed gas contract in the United States that dragged on for years. Using foreign lawyers would have cost the NNPC about $ 3 billion in legal fees.

But, Kyari said in line with his management’s two-pronged approach to its performance and excellence across all departments and units of the corporation, NNPC lawyers would handle the case.

He said the idea was to entrench a high level of efficiency anchored on proficient implementation of business processes to emplace an appropriate reward system for exceptional performance among the NNPC workforce.

Kyari did not see spending billions of Naira to hire foreign legal experts to represent NNPC’s interest in courts abroad as an appeal option, particularly when there were several qualified and competent Nigerian lawyers and legal experts on the corporation’s payroll doing nothing.

He approved that NNPC lawyers from Nigeria should travel to the United States to defend the corporation. The representation from the Corporation’s legal department not only succeeded in its assignment but also set a legal benchmark for NNPC Limited going forward.

Leadership For Oil Industry Fight Against COVID-19: Malam Mele Kyari has led the oil and gas industry’s effort to support the government to limit the dread of the deadly Coronavirus pandemic in Nigeria. His achievements are too important to be appreciated only within the local environment. This underpins our zeal to take his profile to the stars beyond the sky.

Energy

“Going Green Is The Future For Data Centers In Africa” – Jasper Lankhorst

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Going Green Is The Future For Data Centers In Africa

Jasper Lankhorst is the Group CEO of the Best-Connected Carrier And Cloud Neutral Data Centre In West Africa, Rack Centre

Rashidat Olushola Okunlade Writes

The Group Chief Executive Officer of the best-connected Tier III Carrier and Cloud neutral data centre in West Africa, Rack Centre, Jasper Lankhorst, has restated the company’s commitment to the green economy even as it has vowed to continually enhance its drive for sustainability in its operations.

Jasper Lankhorst made this known at the just concluded 2022 AfricaCom/Africa Tech Festival in Cape Town, South Africa.

Speaking during the panel session themed “The Importance of Going Green” for the future of Data Centres in Africa. He explained that Rack Centre, part of the pan-African data centre platform, was undertaking a range of measures that are tailored toward green design principles, some of which include switching from diesel to gas power generation, implementing water-efficient cooling systems, implementing low-energy air circulation system and sourcing local materials and services wherever possible.

Going Green Is The Future For Data Centers In Africa

According to him, the organisation is switching its power source from diesel to gas, not only to save more than $10 million a year in operating costs but also to reduce carbon footprint, reduce environmental impact and align with global sustainability data centre design trend.

“As a result of these moves, Rack Centre is forecasted to be 35% more energy-efficient than other regional data centres, and 16% more energy-efficient than the global average. It will reduce water consumption by 41%, and there will be a 45% saving in embodied energy in materials used,” he said.

He further noted that, though customers are demanding a sustainable strategy for the business, hence, the choice of going green, though capital-intensive, should be sustainable. They must be as energy efficient as possible and use reliable, low-carbon sources of power to ensure uninterrupted operations, which is in line with the organisation’s prime aim to provide 100% uptime.

Other notable panelists at the session include Mustapha Louni, Senior Vice President, Uptime Institute; Nikki Blake, Business Development Manager for Bergvik; Kevin Kent, Director of Data Center Business Development nZero; Dr. Angus Hay, Regional Executive, Africa Data Centres, and Divyajeet Mahajan, Chief Executive Officer, Distributed Power Africa (DPA), Zimbabwe.

In addition to the existing Rack Centre LGS 1 data centre in Lagos, which supports 1.5MW of IT power, our campus is now being expanded with a new building, the LGS 2 facility which supports 12MW of IT power. This provides a total IT power of 13.5MW in the Nigeria campus, built using modern, efficient and green design architecture. We have a principle known as KIA – Keep In Africa, and it’s a philosophy we use in our design and the procurement process to make it sustainable with the availability of local knowledge and local skills to be able to build and operate it,” he added.

In June 2022, Rack Centre became the first International Finance Corporation (IFC) EDGE-certified data centre in Europe, the Middle East, and Africa. It is officially making this the first Green Certified Data Centre in Africa. It is the most connected facility in the region according to its PeeringDB ranking and links every country on Africa’s Atlantic coast.

In 2019, the Southern Swamp Associated Gas Solutions project was commissioned, and the SPDC JV is planning to reduce associated gas flaring further through its Forcados Yokri gas-gathering project, of which large parts are set to be completed in 2022. Despite such efforts to reduce continuous flaring, unfortunately flaring intensity (the amount of gas flared for every tonne of oil and gas produced) at both SPDC- and SNEPCo-operated facilities increased in 2021 owing to short-term operational issues. Flaring from SPDC-operated facilities increased by around 5% in 2021 compared with 2020. The increase was primarily because of the extended outage of the gas compression system in SPDC’s shallow-water operations. The system was restored and became operational from January 2022. Flaring at SNEPCo-operated facilities rose by around 160% in 2021 compared with 2020. This was mainly because of an increase in flaring on the Bonga floating production, storage and offloading (FPSO) vessel. Repairs to a flex-joint on the Bonga FPSO’s gas export riser in the second quarter took longer than expected, in part because of weather conditions. While repairs were under way, the FPSO continued to produce oil and therefore flaring was necessary for safety reasons. The repairs were safely concluded in July 2021. Although flaring intensity levels rose in 2021, SPDC and SNEPCo over the last 10 years have almost halved the combined amount of hydrocarbons they flare from 1.5 million tonnes in 2012 to 0.8 million tonnes in 2021. This reduction is the result of a strict flaring reduction management process and both SPDC and SNEPCo will continue to work in close collaboration with joint-venture partners and the government to make progress towards ending routine flaring of associated gas. NIGERIA LNG EXPANSION UNDERWAY Global demand for LNG continues to grow as the world increasingly seeks reliable supplies of lowercarbon energy. Shell’s investment in Nigeria’s gas infrastructure for export is expected to help 6 This is according to a data provided by global research and consultancy business Wood Mackenzie. the country benefit further from revenues. Shell Gas B.V. and its partners took a final investment decision in 2020 on a new LNG processing unit – known as Train 7 -- at NLNG. The expansion is expected to create around 12,000 jobs for Nigerians during construction and stimulate growth of the local oil and gas service sector, with 55% of engineering and procurement of goods and services being sourced in-country. Train 7 is expected to ensure Nigeria’s continued place as a global player in a lower-carbon energy source. Once operational, Train 7 will add around 8 million tonnes per annum of capacity to the Bonny Island LNG facility, taking the total production to around 30 million tonnes per annum. In 2021, NLNG began awarding procurement and construction contracts. Early works started at the site. The first phase of the worker village is expected to be ready for occupancy in 2022 and the new material offloading facility ready for use by the end of 2022. NLNG’s Train 7 is expected to come onstream in the middle of the 2020s. KEY LICENCE RENEWED FOR DEEP-WATER SNEPCo has interests in four deep-water blocks in the Gulf of Guinea, two of which it operates. Today, nearly one-third of Nigeria’s deep-water oil and gas production comes from the Bonga and the nonoperated Erha fields.6 Since production began in 2005, Bonga alone has produced more than 950 million barrels of oil with the 2021 average oil production per day at 105,000 barrels. The Bonga FPSO vessel has a total production capacity of 225,000 barrels of oil per day and 150 standard cubic feet of gas export per day. In 2021, the availability of the FPSO vessel increased to 80% from 70% in 2020. In addition to Bonga, SNEPCo’s exploration activities have led to several significant discoveries of oil and gas over the last two decades, including the Bolia and Doro fields (Shell interest 55%). Nigeria Briefing Notes Helping to power Nigeria’s economy 13 In the right investment climate, SNEPCo believes that there are opportunities to expand. In 2021 the OML 118 (Bonga) production sharing contract was renewed and the lease extended for 20 years. Bonga North and Bonga South West Aparo (BSWA) oil fields are two such potential opportunities. Bonga North is a proposed tie-back project to the existing Bonga FPSO with Phase 1 comprising 14 wells. BSWA is a development of a new FPSO with Phase 1 comprising 23 wells. SUPPORTING RENEWABLE ENERGY STARTUPS Millions of Nigerians are excluded from the country’s power grid and Shell Companies in Nigeria have established and provided substantial funding for a not-for-profit, impact-investing company called All On. Operating as an independent company, All On works to bring reliable electricity – often from renewable energy sources -- to off-grid urban and rural customers. This support aims to build a solid pipeline of viable businesses that can create the scale required to address Nigeria’s access to energy gap. In December 2019, SPDC and SNEPCo made a significant additional 10-year financing commitment of $160 million in All On, bringing the total commitment to $200 million. By the end of 2021, All On had provided investment capital to over 40 renewable energy start-ups in its portfolio – an increase of more than 30% from 2020. One such company is Infibranches Technologies Limited, to which All On has committed $2 million, which is expected to enable the indigenous technology company to expand sales of solar home systems via its more than 13,000 agent banking partners across Nigeria. With the support of the Rockefeller Foundation, the All On Hub was established in 2020 to provide nonfinancial support and build the capabilities of off-grid energy entrepreneurs. In 2021, the hub supported 81 ventures – nearly double the 41 supported in 2020. Also in 2021, All On, Odyssey Energy Solutions and the Global Energy Alliance for People and Planet launched a $10 million equipment financing facility as part of the DART pilot programme in Nigeria. 7 Hydraulic flying leads support the delivery of hydraulic fluid and/or chemicals between subsea equipment. 8 Subsea trees are an assembly of valves and other components used to monitor and control the production of a subsea well. DART will combine demand pooling, aggregated purchasing of solar equipment, and access to affordable finance to unlock economies of scale for solar companies, achieve cost savings for end-users, and accelerate the growth of the renewable energy sector in Nigeria and beyond. DEVELOPING LOCAL CONTENT AND SKILLS Shell Companies in Nigeria contribute to the growth of Nigerian businesses that can provide technical and support services to the industry. This includes the manufacture of tools and technical kits, the operation of helicopter flights in the Niger Delta, and strategic partnerships between foreign and local companies to stimulate technology transfer and capacity development. While there are government-required programmes in some areas, such as the Nigerian and Community Content Strategy embedded in the Assa North/Ohaji South gas development project, Shell Companies in Nigeria deliberately seek to contract local businesses wherever possible. In 2021, Shell Companies in Nigeria awarded $800 million worth of contracts to Nigerian-registered companies. Of these, 92% were companies with at least 51% Nigerian ownership. SNEPCo has awarded major engineering and construction contracts to companies that are indigenous, have local staff, or possess domestic capabilities in the country. At present, the manufacture and rebuild of hydraulic flying leads7 (HFLs) is being carried out in-country by wholly indigenous companies. Pressure Controls Systems Nigeria Limited, another Nigerian company, continues to refurbish old subsea trees.8 Sometimes, a lack of access to capital hinders Nigerian companies from competing for and executing contracts effectively. Shell Companies in Nigeria have provided access to nearly $1.6 billion in loans to 901 Nigerian vendors under the Shell Contractor Support Fund since 2012. These loans help improve their tendering opportunities.

About Rack Centre: Rack Centre is the best-connected Carrier and Cloud neutral Tier III constructed Facility Certified data centre in Africa. Established in 2012, the company focuses solely on providing best-in-class data centre colocation services and free interconnection between carriers and customers. Knowing this gives customers a technically superior, physically more secure, and lower-cost environment for their information systems.

The Carrier and Cloud neutrality advantage allows customers to manage traffic to get better value, lower latency, and higher resilience and creates an open market for partnerships between customers, networks, cloud and content providers, the Internet Exchange Point of Nigeria, and managed service providers.

Rack Centre’s clientele includes 53+ telecommunication carriers, Internet Service Providers (ISPs), global Tier 1 networks, and pan Africa international carriers, including direct interconnections to all five undersea cables serving the South Atlantic Coast of Africa including Equiano and in the foreseeable future 2Africa and every country on the Atlantic coast of Africa.

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Eko DISCO Assures Customers In Orile, Apapa Districts Of Improved Service Delivery

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Eko DISCO Assures Customers In Orile, Apapa Districts Of Improved Service Delivery

Olushola Okunlade Writes

Eko Electricity Distribution Company (EKEDC) has assured it will upgrade its service delivery in Orile and Apapa environs at customer engagement forums held on November 10 and 17 respectively, in continuation of its strategic plan to engage electricity consumers across its franchise area for improved service delivery based on feedback.

The Managing Director/CEO of Eko DisCo, Dr. Tinuade Sanda, who was represented by the Chief Financial Officer, Joseph Esenwa at the forum said in continuation of the DisCo and stakeholder engagement to get on-the-spot feedback and review for possible upgrades in the areas of power supply, billing, metering, vandalism, and other factors mitigating service delivery to customers.

Mr. Esenwa thanked customers for making time out of their busy schedules to attend the session, ‘’we do not work in isolation, we are here to listen, and share ideas because we believe in a good relationship, it’s a mutually beneficial meeting, we aim to serve you, and we want to know what we have to do to improve our services” he said.

Eko DISCO Assures Customers In Orile, Apapa Districts Of Improved Service Delivery
Left-Right: Gibraltar Njowusi; Apapa Local government Secretary, Madam Oyinlola Lambo; Customer Service Representative, Mrs. Lilian Obiakor; District Manager Apapa, Engr. Ukoh Henry; Head, Distribution Operations, Joseph Esenwa; Chief financial officer, Mr. Sam Edoho; GM Commercial, Engr. Kamaldeen Saadu; HoD Network Planning, Lt. Col. Afolabi Oluyinka; Representative of the Arakan Barracks Cantonment Commander.

Mr. Esenwa said EKEDC has learned from engagement over the years that the major issues between the customers and the company are estimated bills, he said the DisCo has no reason to increase the bills as he described EKEDC as a retailer who purchases electricity in bulk then sends to customers.

For those who are yet to collect their prepaid meters, he said some customers had applied and paid for the prepaid meters under the MAP scheme registered without providing the right biodata when registering for the scheme.

Mr. Esenwa said, “While the commitment to install prepaid meters for customers under the MAP Scheme is critical, we have noticed that some customers provided wrong details including their valid means of identification. There is nothing we can do until they come forward to address the issue.

“Some of the incorrect details include wrong addresses, emails, applicants’ reference numbers, and invalid means of identification. The invalid biodata has delayed the issuance of receipts for the processing of the meters.

He further assured customers in Apapa and Ijora Districts respectively that the DisCo would soon visit the areas under the district to launch the mobile metering exercise for the on-the-spot applications of customers to support the existing online process of acquiring prepaid meters by customers under the MAP scheme.

Esenwa further reiterated that “The Meter Asset Provider Scheme has enabled customers to procure meters directly and be metered within 72 hours of payment confirmation and urged other customers to take advantage of the window to access their prepaid meters.

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CNN’s Connecting Africa Visits Cape Town For Africa Energy Week

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CNN’s Connecting Africa visits Cape Town for Africa Energy Week.

Olushola Okunlade Writes

In the latest episode of Connecting Africa, CNN International’s Eleni Giokos visits Cape Town for Africa’s Energy Week, where leaders gathered to discuss the issue of energy poverty and the transition to renewable energy.  

Verner Ayukegba, Senior Vice President of the African Energy Chamber describes the energy situation, “600 million people without any kind of access to energy, and 900 million people, mostly women, and children, without any access to clean cooking fuelsFrom that perspective, Africa’s energy situation is one where we need to focus on investing significantly into generating power for all of those people. That is why we have decided to champion making energy poverty history by 2030.” 

Coal remains South Africa’s main source of energy. Ayukegba says, “It’s easy to say we wean ourselves off coal. In Africa, we are saying we are for solar as well, but what we can’t do is close all the coal mines. We need solar, but we also need base load, a significant amount of base load, which comes with gas, coal, hydrocarbons, hydro, and all of that. We can’t afford at this stage to discard any of the solutions.” 

Giokos later visits Middleburg Mine Services, in her hometown of Emmaelni which is home to 1,200 employees, to discover how the transition away from fossil fuels will impact local communities and employees. Seriti, one of South Africa’s largest coal producers, employs nearly 20,000 workers across several mines.  

Mike Teke, CEO of Seriti, shares his awareness of the need for an energy transition, “Everybody understands climate change. Everybody understands decarbonisation. Nobody amongst us who run coal mines or who operate in the mining industry are climate denialists.”  

He highlights the differences in energy in Africa and the need to transition strategically, “We operate in a country that is a developing economy, a growing economy. We’re not a developed economy like the United States or some of the countries in Europe. We need to develop our own agenda as South Africa.” 

Teke wants to make sure coal workers are reskilled for the energy transition, “We need to be realistic and say if we were to go into building solar farms, wind farms, hydro, and the light new forms of energy, it’s not going to be one for one the jobs. That is why we transition. That is why we need to reskill our employees to new forms of employment and new skills that will give them a livelihood into the future.” 

General Manager at Just Energy Transition, Eskom Holdings, Mandy Rhambaros, is also prioritising helping the transition of workers, “We are training all our staff at Komati on renewables. Our guys will be retrained and obviously, those that want to stay on to operate and maintain the renewables plants that we will be building will be more than welcome to do so.” 

Priscillah Mabelane is the Executive Vice President at Sasol, a major provider of energy and chemicals. Sasol is committed to the energy transition but, according to Mabelane, the most viable vision for coal is the reduction of its need over time. “At some point into the future, 2050 to 2060 dependency on coal is going to disappear. The question is how do we transition from that? We’ve set ourselves carbon neutrality by 2050. That’s clear. We are changing our mix of energy and replacing coal with renewables. At the same time, we are also ensuring that we are efficient in the way we consume energy going forward,” she says. 

Solar energy is also an alternative energy source with a lot of potentials. The continent is home to 60% of the globe’s solar resources but only 1% of the world’s installed solar capacity, according to the International Energy Agency. 

David Masureik, CEO of New Southern Energy, explains that his company is providing solar energy solutions to a range of businesses in South Africa, Nambia, Botswana, Tanzania, and Kenya. “Our clients range through various sectors, agriculture, manufacturing, hospitality, retail, and property. We very much focus on the commercial and industrial space, so that’s rooftop solar and behind-the-meter solutions. It plays a big part in demand reduction and provides, in the South African context, clients with energy security and cost reduction.” 

Masureik admits, “Whether we like it or not, we have to live with coal for the foreseeable future. Our base load at the moment is heavily dependent on coal.” However, he thinks that with time South Africa will move to a greener future, “I think with more and more renewables coming online, with battery technology coming to the fore on a utility-scale, with peaking plants and things like that coming into play, even green hydrogen, I think we might get to a scenario where actually the baseline will be reduced significantly from coal.” 

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