Nothing to Worry About IOC’s Divestment

THE Nigerian National Petroleum Corporation, NNPC, has said that international oil companies operating in the country have been sitting on oil blocks and have allowed the acreages to go fallow for years without significant development. The corporation stated that the recent spate of divestments from certain onshore oil blocks by some of the IOCs would not lead to crisis in the nation’s oil and gas industry.

Andrew Yakubu, group managing director, NNPC, said the divestments were not only healthy for the oil and gas industry in the country, but would also go a long way in promoting effective indigenous participation in core upstream activities. Yakubu, who spoke on the sidelines of the ongoing World Energy Congress in Daegu, South Korea, was quoted as saying, “These are not withdrawals in the real sense of the word. The fact is that a number of these IOCs are moving into more challenging frontiers in the deep offshore and are leaving the onshore blocks, which they consider less challenging. So, it is only fair for them to release these blocks so that others, especially the indigenous operators, can have them and grow in the upstream business. This, indeed, is a good development and I think we are moving in the right direction,” he said.

The NNPC boss said the divestment offered immense opportunities for the nation’s  indigenous flagship upstream operator, the Nigerian Petroleum Development Company, to grow its capacity and capability, especially as it strived to meet the target of daily crude production of 250,000 barrels by 2020.

The country’s oil and gas sector has witnessed a spate of divestments by oil majors in the last few years. The development became a regular occurrence due to what stakeholders described as an unfavourable operating environment. The divestments by some of the IOCs are linked to the uncertainties surrounding the Petroleum Industry Bill, a development that has also made the oil majors to hold back on future investments.

Nigeria Wants Brazilian Investment


THE federal government has appealed to the Brazilian government to invest in the country’s ailing power sector with a view to revamping it. Chinedu Nebo, minister of power, said while receiving a Brazilian delegation led by Ricardo Shaefer, vice-minister of development, industry and international trade, that the government “needs assistance from around the world to revamp the ailing power sector.”

The minister also requested for synergy and co-operation of the Brazilians in Nigeria’s quest to ensure that all its nationals are connected to electricity. “Brazil has not penetrated enough in our on-going sales of power assets. We are prepared to link you with Nigerian partners, so that we can benefit from your expertise in generation, distribution, technology access and capacity building. Brazil has done well in many aspects of electricity especially in big hydro, biomass, solar, wind and coal. Nigeria intends to learn from the experience of Brazil, as the country has already leap frogged in the attainment of development goals,” he said.

On rural electrification, Nebo said the leadership shown by Brazil to other countries in the so-called third world has provided a ray of hope that soon Nigeria would overcome its developmental challenges. He also spoke about the challenges Nigeria is facing in addressing the metering gap. This, he said, had become a problem against the backdrop of the fact that over 50 percent of electricity consumers have no meters. “In a privatised electricity market, prospective investors will be scared, as this may translate to their inability to recoup from their investment.”

Pussy-footing over PHCN Staff Benefits

THE senior Staff Association of Electricity and Allied Companies, SSAEAC, has dismissed federal government’s claims that most of the workers of the Power Holding Company of Nigeria, PHCN, have been paid their terminal benefits ahead of the final hand-over to the new owners. In a petition to the minister of power, the association claimed the money purported to have been paid to the workers after the October 2 agreement with government never entered the workers’ accounts. It reiterated its position that no new owner would take physical possession of PHCN assets until all workers had been paid their terminal benefits.


The petition by Bede Opara, SSAEAC president-general, and Abiodun Ogunsegha, secretary-general, warned that workers would shut down the sector should efforts be made to physically take over the assets without full payment of workers’ benefits. “We state here that in our meeting with the chairman, implementation committee, permanent secretary and minister of power on Wednesday 2nd October, 2013, it was agreed that payment of terminal benefits of PHCN staff entitlements will be concluded in two weeks from that date. However, we note that up to this moment, only a handful of payment has been made.

“What we heard or read in the newspapers is that government intends to physically hand over the PHCN infrastructures to the investors on 1st of November, 2013. We state that this will negate and violate the understanding and agreement reached with the unions and we clearly to state again that we shall resist any physical hand-over until all payments are concluded.

“Information available to us is as follows: Benin, 50 percent not paid yet, Jos, 55 percent not paid yet, Sapele, 77 people not paid, Egbin, 60 people not paid yet, Ughelli, 61 people not paid yet, Afam, 67 people not paid yet, Kaduna, 100 per cent yet to collect – nobody has been paid. Jebba 219 yet to be paid, Abuja, over 1000 people not paid, Transmission -none has been paid and, retirement savings account, RSA, entitlements not paid to anyone,” the petition said.

It added: “Government had said and made us to believe that the money needed was available. We also got the assurance of the accountant-general of the federation that money is available to pay. Who is holding the money or refusing to release it to the beneficiaries? Government should act now or else, no one should blame the labour union for any action that would be taken.”

Compiled by Anayo Ezugwu 

— Oct. 28, 2013 @ 01:00 GMT

Contact Us