Gas
NLNG to pay $1bn as company tax in 2014
LAGOS – The Nigeria Liquefied Natural Gas Limited, NLNG, is to pay over $1 billion as Company Income Tax (CIT) to the federal government in 2014, even as it moves to take delivery of six more ships to consolidate its operations.
With $1.3 billion already sunk into acquiring six fully-built vessels from Samsung Corporation and Hyundai of South Korea, the company’s Managing Director, Mr. Baba Jolayemi Omotowa, said when delivered in 2015, the number of ships in its fleet would come to 30.
Omotowa, who made a presentation when the Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, visited the NLNG plant in Finima, Bonny Island, Rivers State, at the weekend, said as one of the fastest growing companies in the world with six trains already, the company would be recording about 3,000 cargoes next year.
While expressing the company’s desire to add more trains in the production line, he said over $1 billion would be paid into the coffers of the federal government in 2014, making it one of the few companies with such CIT record in the country.
He said with the commencement of operations in 1999, the company had been able to cut down gas flaring from as much as 65 per cent to about 20 per cent presently, adding that this would be further reduced to the barest minimum as more trains are added.
Omotowa stated that with about 95 per cent of its personnel as Nigerians, the firm was creating jobs and desirous of building capacity as well as vigorously pursue its local content drive.
He said one of the areas where the company’s local content drive had received practical expression was in the current contract it awarded to two Korean companies to build six ships,
adding that the terms of the contract was for them to source some of the materials from Nigeria.
“We are constructing six brand new ships in Korea and the total cost of construction is $1.3 billion. We are training Nigerians in the process. We will train over 600 Nigerians and 100 of them will give advanced training too and 30 of them we will actually go to Korea to learn more about ship-building so that they will participate in the construction of ships.
“We are hoping to develop the capacity so that in future when we have dry docks and have other ship-building capacity in Nigeria we have Nigerians who can do the work. They are being trained in ship-building. The ship-building industry in Nigeria is being developed. There are dry docks being built in Nigeria. There are shipyards being built in Nigeria. When they come back, they will be able to build the skills; they will be used in those ship-building industry,” he said.
Omotowa called on the federal government to check the smuggling of low quality liquefied petroleum gas (LPG) from Niger Republic, saying it was a serious disincentive to the NLNG in particular, investors and the country in general.
He also advised the federal government to consider the removal of subsidy on kerosene, adding that with that, investment in LPG would receive a boost, which in turn would revolutionise the use of cooking gas in Nigeria.
“LPG, which is cooking gas, is a very clean gas which is healthy for both the environment and for people. As a country, we could use a lot more LPG than we do. Unfortunately, in Nigeria, because kerosene is being subsidised, the price of LPG has not been attractive to people. The problem is that the use of kerosene is an alternative to wood; there has been issues about the environment and health issue. So, the removal of subsidy will help cooking gas to be used, which will be cheaper and more environmentally-friendly,” he said.
On Okonjo-Iweala’s visit, Omotowa said it was an inspiring one, adding: “She has come to see what we are doing and to see 100 per cent the Nigerian management. 95 per cent those who work here are Nigerians. So, she has come to visit the plant and to see for herself. This plant has been a pride to Nigeria. Internationally, the plant is recognised all over the world as one of the best plants in the world. So, she has come to see that and to offer us support. We are inspired by her visit.”
He said in the next five years, the company would continue to record stellar performance.
“The organisation is recognised in the world for its performance. So we will continue to do that. We are growing as well. We are building six new ships and we are also working hard on our growth project. So we are looking to grow the organisation, grow the plant and continue to deliver more value for Nigeria. We are keen to be seeing the value that we bring to Nigeria. So, over the next five years you will see more of that,” he said.
In her remarks, Okonjo-Iweala, who described the NLNG as an asset to Nigeria and a shinning example of a successful company where the federal government, the major stakeholder, gave the company plaudits for taking advantage of its tax holiday to grow an enviable balance sheet.
“I came after looking at your books and saw that you have been commercially viable and successful. The Nigeria LNG is an asset to the country,” she said, adding that not much was in the public domain in spite of the very impressive performance of the company.
She admonished the management to strive to secure long-term offshore contracts, adding that with the United States of America joining the league of oil and gas exporters, it was imperative for the NLNG to explore other major importers.
She promised that the federal government would look into the concerns of the company vis-a-vis smuggling of LPG into the country from neighbouring countries in order not to allow some kind of disincentive to investors.
– THIS DAY
Announces ambitious expansion plans
Platform Petroleum says the company is targeting a billion-dollar investment as it announces an ambitious strategic plan to bring 3 marginal fields into production by 2025, with a target of 10,000 barrels of oil and at least 50 billion standard cubic feet of gas per day.
Speaking on the sidelines of the 2024 Offshore Technology Conference (OTC) in Houston, USA, Chief Dumo Lulu-Briggs, Chairman of Platform Petroleum said that the company has scheduled a roadshow in London this June 2024 to raise extra funding to finance their ambitious expansion plans.
“The upcoming roadshow aims to attract equity partners and prepare for future opportunities, targeting a billion-dollar investment. We are seeking partners ready to invest in Nigeria’s oil and gas potential.
Our goal is to showcase the country’s vast opportunities and its potential to international investors” Lulu-Briggs said.
Platform Petroleum’s roadshow in London will highlight the company’s efficient production, upgraded flow stations, increased capacity, and achievements in nearly zero emissions.
With about one percent gas flare currently, Platform aims for zero gas flares by the last quarter.
“Nigeria is a vast market, and Platform Petroleum is thinking big. With the government’s ambitious plans, such as the Lagos-Calabar coastal line, Platform is poised for growth; pushing itself to the next level, building on a strong foundation and following Seplat’s successful precedent”, Lulu-Briggs said.
Despite being a small company, he emphasized that Platform Petroleum has demonstrated significant success and efficiency, showcasing that smaller oil and gas entities can indeed achieve remarkable feats adding that he believes that the company deserves recognition and more assets.
“Platform Petroleum is ambitious, aspiring to become a tier-1 company akin to international oil companies (IOCs) or a tier-2 company like Seplat. Interestingly, Seplat originated from Maurel & Prom, Shebah Petroleum, and Platform Petroleum, and today stands as a major player in the industry.
This history underlines Platform’s potential for substantial growth”, Lulu-Briggs said.
Furthermore, the Platform Petroleum Chairman said that the Offshore Technology Conference (OTC) is a crucial event for promoting Nigeria’s significant market potential.
“Partnering with the Petroleum Technology Association of Nigeria (PETAN) at OTC is key to attracting investment. The current proactive government understands the necessity for economic growth, and Platform is prepared to leverage every opportunity in the oil and gas industry to contribute to this expansion”, he concluded.
Precious ADELOLA
The NNPC/Aiteo Joint venture has announced the introduction of Nembe Crude Oil Grade, a new crude oil grade into the international crude oil market.
The announcement of the Nembe Crude Oil Blend, produced by Aiteo, the Operator of the NNPC/Aiteo Oil Mining Lease (OML) 29 Joint Venture (JV), was made at the ongoing Argus European Crude Conference in London, on Tuesday.
OML 29, an asset located onshore Nigeria, is operated by Aiteo Eastern Exploration & Production Ltd, Africa’s leading indigenous hydrocarbon producer, following a historic acquisition from Shell in 2014.
NNPCL Boss, Engr. Mele Kyari
The Nembe Crude was previously blended with the popular Bonny Light grade and exported via the Bonny Oil & Gas Terminal.
The unique selling point of the Nembe Crude Oil grade with an API gravity was highlighted by both the Aiteo E & P and NNPC Limited Leadership at the Argus Conference in London.
The Nembe Crude Oil grade also has a low sulphur content and low carbon footprint due to flare gas elimination, fitting perfectly into the required spec of major buyers in Europe.
Two cargoes of 950,000 barrels each of the Nembe Crude Oil grade have since been exported to France and the Netherlands. With its attractive Assay of API 29 and low sulphur content, the Nembe Crude Oil grade commands a premium to the global Brent benchmark.
With the NNPC-Aiteo OML 29 JV back on-stream, Nigeria now boasts of an additional crude oil export of 2 Cargoes at 950,000 barrels each per month and 1.2 Bcf of export gas monthly.
This remarkable achievement signals the commencement of activities at Nigeria’s newest crude oil terminal, the Nembe Crude Oil Export Terminal (NCOET), which was licensed in line with the extant laws and Crude Oil Terminal establishment regulations.
The terminal was conceived as a Floating Storage and Offloading Vessel (FSO) with a storage capacity of two (2) Million Barrels and the ability to offload crude oil to any export tanker from AFRAMAX to Very Large Crude Carriers (VLCC).
It has a loading capacity of 25,000 barrels per hour and will be exporting over 3.6 million barrels of Crude oil monthly at full scale of operation.
Currently, hydrocarbon production from OML 29, which was hitherto constrained due to evacuation challenges owing to the security issues around the Nembe Creek Trunk Line (NCTL) corridor, has now been resolved through a collaborative and creative approach that led to the innovation of the Alternative Crude Oil Evacuation Solution.
The Argus European Crude Conference 2023 in London is a gathering of energy majors, refiners, NOCs, traders, financial institutions, and other representatives from across the global oil markets. The event also provides a critical opportunity for business leaders to connect, discuss, share and learn from one another.
Modupe Asudo
Major players in the oil and gas sector in Nigeria led by the Nigerian National Petroleum Company Limited (NNPCL) have covenanted to optimise operations by reducing contracting cycle to not more than 180 days.
A statement issued by the company disclosed that the Memorandum of Understanding (MoU) to this effect was endorced on Monday in Abuja at the company’s head office.
Other parties to the the contract include, the Nigerian Content Development and Monitoring Board, (NCDMB) and international oil companies.
Biztellers reports that an optimised contracting cycle was expected to improve the ease of doing business, reduce cost and drive efficiency, which would eventually translate to production growth, increased revenues, and ultimately improved profitability.
In addition, the MoU was expected to contribute significantly to the double-digit economic growth rate agenda of the Federal Government and generate value for all stakeholders, including investors, companies, host communities and Nigeria.
Notable elements in the framework of the MoU, going by the statement, included a reduction of the contracting cycle for open competitive tender, selective tender, and single sourcing tender to 180, 178, and 128 working days respectively.
This was in contrast with the current best effort performance of 327, 333, and 185 working days respectively.
According to Group Chief Executive Officer, NNPCL, Mele Kyari, signing the agreement portends exciting times for Nigeria’s oil and gas industry, in addition to standing as a bold testimony that the company was plunging into the future of hope, productivity and success.
Kyari, represented at the occasion by Executive Vice President, Upstream, NNPCL, Oritsemeyiwa Eyesan, pointed out that with oil and gas as the bedrock of Nigeria’s economy, there was need to get the contracting process in the Industry right so as to get the economy back on track.
In his remarks, Executive Secretary, NCDMB, Simbi Wabote, described the MoU as a way forward and a critical step towards enhancing the nation’s crude oil production.
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