Oil & Gas

PEF, PPPRA to be merged in new PIB – Minister

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Chief Timipre Sylva, the Minister of State for Petroleum Resource, says two regulatory bodies in the oil and gas sector will be merged as one regulator in the new Petroleum Industry Bill (PIB).


Sylva disclosed this while briefing newsmen in Abuja on Thursday.

The two agencies are Petroleum Equalisation Fund (PEF) and Petroleum Products Pricing Regulatory Agency (PPPRA).

He said that the two would be merged under the name:  “The Authority” as regulator in the industry.

He said that the agencies would still be relevant to serve as regulators in the industry, noting that without PPPRA and PEF, it would be difficult to deal with profiteers.

PEF and PPPRA will emerge as one under a name The Authority’ and will be helping to police the pump price of petrol so that nobody will profiteer,’’ he said.

The News Agency of Nigeria reports that while PEF deals equalisation of petroleum products to ensure price uniformity, PPPRA deals with petroleum products pricing and monitoring of compliance.

Edited By: Chioma Ugboma/Grace Yussuf (NAN)

 

 

 

https://nnn.ng/pef-pppra-to-be-merged-in-new-pib-minister/

Oil & Gas

DPR generates N742.4bn revenue in 8 months

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The Department of Petroleum Resources (DPR) says it generated a total sum of N742,471,639,376. 96 billion for the Federal Government from  January to August 2020.


Mr Sarki Auwalu, Director, DPR  made the disclosure during a visit of the Federal House of Representatives Committee on Petroleum Resources (Upstream) to the DPR headquarters in Lagos on Wednesday.

The News Agency of Nigeria reports that the committee, chaired by Mr Musa Adar, visited the regulatory agency as part of its oversight duties.

Auwalu expressed optimism that the regulatory agency would surpass its revenue target for the year despite the  ‘triple force’ of COVID-19 pandemic, oil price crash and OPEC plus production cuts.

He said, “DPR is a revenue collection agency for revenues accrueable to government from oil and gas industry operations.

DPR operates a cashless revenue system which enables all revenue remittances to be paid directly to the federation account in total compliance with the Treasury Single Account (TSA) policy of government.

“The agency conducts comprehensive quarterly and annual reconciliations of revenue payments to ensure accurate and timely remittances to the federation account.

“It also collects oil and gas royalties which represents proportional value of oil and gas production and sales from oilfields, gas flare penalties imposed for gas flaring,” he said.

According to him, DPR collects concession rentals paid for grant of oil and gas acreages by exploration and production companies and miscellaneous oil revenue.

He said that these consisted of statutory application fees, licence and permit fees and penalties.

Auwalu said that the challenges posed by COVID-19 and oil price crash had made it compelling for a  new thinking and approach for strategic repositioning and business optimisation in the industry.

The DPR boss said the agency had, therefore,  adopted several approaches and streamlined its processes to deepen its influencing role as an opportunity house and business enabler for the Industry.

He said the approaches include  cost control and management, strategic partnership, vertical integration  and diversification and portfolio rationalisation and  operational resilience.

On his part, Adar told newsmen that the National Assembly would expedite action on the passage of the Petroleum Industry Bill (PIB) in order to reposition the industry.

“We want to assure Nigerians that once we receive the PIB,  we will ensure its quick passage.

” There is a good relationship between the executive and  lawmakers and there will be a bipartisan approach toward the bill because we must put Nigeria first as patriotic citizens,” he said.

He said the visit to the regulatory agency had enlightened the lawmakers on the need to enact legislation that would ensure maximisation of Nigeria’s oil and gas resources.

Edited By: Chioma Ugboma/Oluwole Sogunle
Source: NAN

https://nnn.ng/dpr-generates-n742-4bn-revenue-in-8-months/
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Metro

NLC to come out with position on petrol, electricity hike soon – Wabba

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The Nigeria Labour Congress (NLC), says the organised labour will soon come out with a position on the recent increases in prices of various essential commodities, including fuel and electricity.


Mr Ayuba Wabba, NLC President spoke with the News Agency of Nigeria in Lagos on Saturday in reaction to the increases in the prices of petrol and electricity.

NAN reports that the Petroleum Products Pricing Regulatory Agency (PPPRA) announced that the pump price of premium motor spirit (petrol) has been increased to N151, 60 per litre from N145 with effect from Sept 2.

Also, electricity tariff was increased effective Sept. 1, by the Nigerian Electricity Regulatory Commission (NERC) from N30.23 per one kwh to N62.33.

Wabba, who spoke on the issues, said the organised labour would not protest until the Central Working Committee (CWC) met and agreed on appropriate action.

“Labour takes one battle at a time; it does not make announcement without backing its action,” the labour leader said.

He noted that NLC had remained consistent on neo-liberal policies, and would take appropriate action in respect of the increases in order to achieve desired result.

He also said that it was high time Nigeria started refining products locally to solve importation challenges.

On the suspended planned protest against the Rivers government, Wabba said that there was the need to mend fences between the state and labour to ensure harmonious relationship.

According to him, the will of the people should not always be taken for granted “as injury to one is injury to all”.

The NLC president called on other state governments to take appropriate steps toward addressing labour issues so as to avoid the wrath of the organised labour.

“We will take up any state that undermines the rights of workers. Workers should be conscious of their rights; there is synergy and we will confront recalcitrant employers to respect the law so that we don’t give room for sudden situations to rise,” Wabba said.

He further said that the Rivers government and labour have concluded negotiations on minimum wage, and the enabling circular would be released for a collective bargaining agreement to be signed.

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Edited By: Chinyere Bassey/Maharazu Ahmed
Source: NAN

https://nnn.ng/nlc-to-come-out-with-position-on-petrol-electricity-hike-soon-wabba/
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Oil & Gas

Deregulation: PPPRA assures Nigerians of better days ahead

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The Petroleum Products Pricing Regulatory Agency (PPPRA) has assured Nigerians that the deregulation of the downstream oil sector is in the best interest of the country.


The Executive Secretary of the Agency, Saidu Abubakar, gave the assurance on Tuesday in Abuja, while briefing newsmen on the deregulation of the downstream oil and gas sector.

Abubakar said that the recent increase in the pump price of the Premium Motor Spirit, PMS, hinges on the global market and availability of forex to marketers.

Represented by Mr Victor Shidok, the General Manager, Administration and Human Relations, Abubakar said many marketers were yet to start importation of products due to non-availability of foreign exchange.

According to him, although the Petroleum Products Marketing Company (PPMC), a subsidiary of the Nigerian National Petroleum Corporation (PPMC), remained the sole importer of the product, PPPRA will continue to monitor development to check profiteering by marketers.

“The PPPRA as a regulator will continue the role of a watchdog in this deregulation regime. We will continue to maintain our role as a regulator and ensure that Nigerians are not short changed in any way in this process.

“You know how things are globally with the impact of COVID-19 to the global oil market. Accessing forex remains a challenge for marketers.

“We are hopeful that in a few months to come, Nigerians will understand what government is doing to stabilise the downstream sector,’’ he said.

Abubakar said that the agency would continue to monitor the code of conduct that guides operation of marketers in the industry and ensure that it was not violated.

He reiterated that government was no longer in business of fixing the pump price of petrol but would monitor marketers to avoid profiteering.

He hinted that the agency may not be able to provide monthly price band for the product as it contradicts the deregulation policy.

“If we give you the price band for this month, it is like price fixing’’ he said, and assured Nigerians that better days were ahead as things would normalise with time.

Edited By: Johnson Eyiangho/Ismail Abdulaziz
Source: NAN

https://nnn.ng/deregulation-pppra-assures-nigerians-of-better-days-ahead/
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Economy

Fuel, electricity subsidies no longer feasible – FG

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The Federal Government says under the prevailing economic conditions it can no longer afford fuel subsidy and supplementing electricity tariff.The Minister of Information and Culture, Alhaji Lai Mohammed, who disclosed this at a media briefing in Abuja said the nation’s revenues and foreign exchange earnings have fallen by almost 60 per cent due to the downturn in the fortunes of the oil sector.


News Agency of Nigeria reports the media briefing, which was on the recent increases in petrol and electricity prices, was jointly addressed by the Minister of Power, Saleh Mamman and Minister of State Petroleum, Timipreye Sylvia.

Mohammed said that despite the economic situation, the government sustained expenditures, especially on salaries and capital projects and stopped unsustainable practices that were weighing the economy down.

“Government can no longer afford to subsidise petrol prices, because of its many negative consequences; these include a return to the costly subsidy regime.

“The second danger is the potential return of fuel queues – which has, thankfully, become a thing of the past under this Administration.

“The days in which Nigerians queue for hours and days just to buy petrol, often at very high prices, are gone for good.

“Of course, there is also no provision for fuel subsidy in the revised 2020 budget, because we just cannot afford it,” he said.

The Minister disclosed that from 2006 to 2019, fuel subsidy gulped N10.413 trillion, an average of N743.8 billion per annum.

He said from the figures provided by the NNPC, subsidy was N257 billion in 2006,  N272billion in 2007, N631 billion in 2008, N469 billion in 2009, N667billion in 2010, N2.105 trillion in 2011 and N1.355 trillion in 2012.

He added  that fuel subsidy gulped N1.316 trillion in 2013, N1.217 trillion 2014, N654 billion in 2015, N144.3 billion in 2017 N730.86 billion in 2018 N595 billion in 2019 while the figure was not available in 2016.

Mohammed said the long-drawn fuel subsidy regime ended in March 2020, with the Petroleum Products Pricing Regulatory Agency (PPPRA) announcement.

He recalled the PPPRA announced that it begun fuel price modulation, in accordance with prevailing market dynamics, and would respond appropriately to any

further oil market development.

“Recall that the price of fuel then dropped from N145 to N125 per litre, and then to between N121.50 and N123.50 per litre in May.

“With the low price of crude oil then, the cost of petrol, which is a derivative of crude oil, fell, and the lower pump price was passed on to the consumers to enjoy.

“With the price of crude inching up, the price of petrol locally is also bound to increase, hence the latest price of N162 per litre.

“If, perchance, the price of crude drops again, the price of petrol will also drop, and the benefits will also be passed on to the consumers.

“The angry reactions that have greeted the latest prices of Premium Motor Spirit (PMS) are therefore unnecessary and totally mischievous,” he said.

The minister said that the Government is not unmindful of the pains associated with higher fuel prices and it will continue to seek ways to cushion the pains, especially for the most vulnerable Nigerians.

“The government is providing cheaper and more efficient fuel in form of auto gas. Also, Government, through the PPPRA, will ensure that marketers do not exploit citizens through arbitrarily hike in pump prices,” he said.

Mohammed also noted that in spite of the recent increase in the price of fuel to N162 per litre, petrol prices in Nigeria remain the lowest in the West/Central African sub-regions.

In a comparative analysis, the minister said a litre of petrol is N332 in Ghana, N359 in Benin Republic, N300 in Togo, N346 in Niger Republic,  N366 in Chad. N449 in Cameroon.

He added that the price of petrol per litre is N433 in Burkina Faso, N476 in Mali, N257 in Liberia, N281 in Sierra Leone, N363 in Guinea and N549 in Senegal.

Outside the sub-region, the minister said petrol sells for  N211 per litre in Egypt and N168 per litre in Saudi,  stressing that with the removal of subsidy, fuel price in Nigeria remains among the cheapest in Africa.

On the service-based electricity tariff adjustment by the Distribution Companies (DISCOS), Mohammed said the government has been supporting the largely-privatized electricity industry.

“To keep the industry going, the government has so far spent almost N1.7 trillion specially by way of supplementing tariffs shortfalls.

“The government does not have the resources to continue along this path.

“To borrow just to subsidize generation and distribution, which are both privatized, will be grossly irresponsible,” he said

The minister noted that in order to protect the large majority of Nigerians, the industry regulator approved that tariff adjustments had to be made only on the basis of guaranteed improvement in service.

“Under this new arrangement, only customers with guaranteed minimum of 12 hours of electricity can have their tariffs adjusted.

“Those who get less than 12 hours supply will experience no increase; This is the largest group of customers.

To address the challenge of arbitrary estimated billing, he said a mass metering programme is being undertaken to provide meters for over 5 million Nigerians.

He said the Programme is largely driven by preferred procurement from local manufacturers to create jobs.

Mohammed said the NERC will also strictly enforce stoppage of estimated billing to ensure that unmetered customers are not charged beyond the metered customers in their neighbourhood.

He disclosed that the government is providing solar power to five million Nigerian households in the next 12 months.

He said the Programme will  produce 250,000 jobs and impact up to 25 million beneficiaries through the installation.

The minister also noted that despite the recent service-based tariff review, the cost of electricity in Nigeria is still cheaper or compares favourably with that of many countries in Africa.

According to him, while Nigeria pays N49.75 per kilowatt, Senegal  pays N71.17, Guinea pays N41.36, Sierra Leone  pays N106.02 and Liberia N206.01

He added that Niger Republic pays N59.28, Mali pays N88.28, Burkina Faso pays N85.09, while Togo pays N79.88.

The minister noted that “the timing of the two necessary adjustments, in the petroleum and power sectors” was a coincidence and not a deliberate attempt to inflict pains on Nigerians.

He urged the people to ignore the “opportunistic opposition and their allies” who are playing dirty politics with the issue of petrol pricing and electricity tariff.

“Please note that these naysayers did not complain when the price adjustment led to lower petrol prices on at least two occasions since March.

“Nigerians must therefore renounce those who have latched onto the issue of petrol pricing and electricity tariff review to throw the country into chaos,” he said.

Speaking in the same vein, Sylva said with the loss of 60 per cent of the nation’s national income due to COVID-19, fuel and electricity subsidies were no longer feasible.

He said due to the pandemic, demand for crude oil, the mainstay of the nation”s economy dropped, affecting earnings.

OPEC said that the only way to increase crude oil prices is to reduce production and we shut down our production to 1.42 million barrel per day from 2 million barrel per day.

“Before COVID-19 crude oil prices was in the range of over 60 dollar per barrel, today, in spite of all the cut in production, we have not been able to achieve more than 45 dollar per barrel.

“You can see that there is a crisis at hand and the only way to adjust is to stop subsidy, which previous administrations have attempted to do.

“We have gotten to that point now,” he said.

The minister called for understanding and support of Nigerians, stressing that it is in the best interest of a sustainable national economy.

Edited By: Felix Ajide
Source: NAN

https://nnn.ng/fuel-electricity-subsidies-no-longer-feasible-fg/
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