Niger’s Application To rRe-join EITI Approved

Following the country’s withdrawal from the EITI process in October 2017, the Government of Niger has committed to fully implement the 2019 EITI Standard. Its candidature was approved by the EITI Board today, making it the 53rd country implementing the EITI Standard, and the 26th in Africa.

Opportunities for EITI implementation

Helen Clark, Chair of the EITI, said: “Niger has played a role in the development of the EITI Standard and in efforts to improve extractive industry governance over the years. We welcome them back as an implementing country and look forward to the EITI contributing to public debate in Niger.”

Niger first became an EITI candidate country in 2007. The country implemented the EITI for 10 years, producing EITI Reports covering fiscal years 2005 to 2014. Niger’s decade of EITI implementation spurred tangible public finance reforms, including annual audits by the Cour des Comptes (auditor general) of the government’s extractives revenue collection.

Niger’s re-admission to the EITI is timely. EITI reporting provides an opportunity to improve public understanding of the way in which subnational transfers are allocated and to track the amounts due to each local government.

EITI implementation can also support the publication of contracts in the official gazette (Journal Officiel), as provided for by the country’s 2010 Constitution provisions (Article 150).

The EITI could provide a way of tracking those contracts not yet disclosed. Three extractives products in Niger – uranium, oil and gold – currently account for 8% of GDP and approximately 50% of the country’s export receipts.

Evaluating EITI implementation in Niger

Niger was first evaluated against the EITI Rules, which preceded the EITI Standard, and was deemed compliant in 2011. Niger’s Validation under the 2016 EITI Standard began in November 2016.

On 26 October 2017, the Board assessed that Niger had made inadequate progress overall in implementing the 2016 EITI Standard, and that it had not made satisfactory progress on civil society engagement.

As a result, the country was suspended from the EITI process. The Government of Niger announced its withdrawal from the EITI on 25 October 2017.

Pathway to implementing the 2019 EITI Standard

During the country’s withdrawal, the EITI has continued to work with government, companies and civil society in the country. In January 2019, Prime Minister of the Republic of Niger Brigi Rafini publicly announced the Government of Niger’s intention “to resume its place within the International EITI and to play, fully and responsibly, as it has always done, its role in the governance of the extractive industries.” On 11th October 2019, the government submitted its candidature application to the Board to re-join the EITI.

EITI implementation in Niger

Niger’s multi-stakeholder group (MSG) was reconstituted on 19 November 2018. It is composed of 30 members, 10 government representatives, one local government representative, nine mining companies and 10 civil society members.

EITI-Niger National Coordinator, Abdelkarim Aksar, said: “The EITI in Niger aims to provide up-to-date relevant information on the extractive industries in Niger in accordance with Articles 149 and 150 of Niger’s constitution. We are working towards transparency at the source. We will continue to support mechanisms to fully integrate transparency within government and company reporting systems".

The World Bank supported the selection of civil society representatives to the MSG. A three-pronged methodology was applied, namely: civil society mapping of active and recognised civil society organisations; the creation of an Action Platform for Civil Society Organisations involved in the Extractive Industries; and the nomination process for civil society representatives to the MSG.

Ali Idrissa, head of civil society organisation ROTAB in Niger, stated: “Local civil society supports Niger’s reintegration into the EITI process and had no objections to the process led by technical and financial partners to support the selection of civil society representatives to the MSG. We intend to hold government accountable for its commitments under the EITI.”

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Canada's Trudeau, African Leaders Discuss Conflict Resolution, Economic Security

Canada’s Prime Minister Justin Trudeau convened a meeting for African heads of state, foreign ministers and representatives of the United Nations and other multilateral bodies on Monday to discuss ways to secure peace across the continent as a necessary condition for prosperity. 

Trudeau, the 2020 chair of the United Nations Peacebuilding Commission, called for cooperation among international partners and governments to create economic opportunity and prosperity that is broadly shared, “…as a way not just of countering the pull of extremism in some places or the cynicism of populism, but as a way of building a real and tangible future for countries around the world.”

The breakfast meeting, which was held on the sidelines of the 33rd African Union Summit in Addis Ababa, was intended to strengthen the Commission’s partnership with the African Union (AU) and to better integrate African priorities in conflict prevention and bolstering economic security. Among issues discussed were the role that international financial institutions and youth job creation can play in Africa in averting extremism and conflict; and the AU leadership in peacekeeping and peacebuilding efforts.    

The talks, titled Sustaining Peace and Economic Security, aligned with the Summit’s theme: Silencing the Guns: Creating Conducive Conditions for Africa’s Development.   

Trudeau acknowledged that one of the biggest challenges both developed and developing countries face is the perception that governments are indifferent.

“In this time of change, in this time of transformation of the global economy, time of conflict, time of climate conflict, people worry that the system has no place for them and isn’t providing them with what they need,” the Canadian Prime Minister said. 

Among participants were President Roch Marc Christian Kabore of Burkina Faso; the Vice President of Gambia, Isatou Touray; President of the United Nations General Assembly, Tijjani Muhammad-Bande, Vera Songwe, Executive Secretary of the United Nations Economic Commission for Africa, and the foreign ministers of Sierra Leone and Rwanda.

President Kabore offered his reflections on the issues. Burkina Faso is one of several nations in the Sahel region that have seen economic growth adversely affected by conflict and instability.    

In opening remarks, African Development Bank President Akinwumi Adesina noted the shifting nature of conflicts across Africa. While the number of outright wars in Africa has declined substantially, they have been replaced with greater fluidity with rising cases of terrorism, extremism, conflicts from non-state actors.

The root causes of conflict, according to Adesina, include “rising inequalities, lack of political inclusiveness, extreme poverty, management and control over natural resources, youth unemployment that causes social unrest, climate change, to name a few.”

The Bank is at the forefront of helping to address fragility in Africa with several initiatives currently underway. So far, $3.8 billion has been allocated to address issues of fragility through the Transition State Support Facility.  

Adesina recognized the role Canada plays in enabling the Bank’s work.

“The successful replenishment of the Bank’s African Development Fund 15 - to which Canada contributed substantially with $355 million - will allow the Bank to deploy an additional $1.2 billion to address fragility, strengthen resilience and sustain peace and economic security,” he said. 

Here Are 3 Sessions To Watch Out For At Nigeria International Petroleum Summit

Three years after the Federal Executive Council of Nigeria took the final decision to approve the Nigeria International Petroleum Summit (NIPS), an African Petroleum Technology and Business Conference, the third edition of the event is set to hold in its capital city, Abuja from 9 - 12 February 2020.

The event, which is highly touted to be the official government-endorsed event has been designed to be the rendez-vous for Nigeria and indeed, Africa's oil and gas sector where principal decision-makers from the public and private sectors exchange innovative ideas.

The African Energy Chamber, as the credible voice of the African petroleum industry and the foremost African advocacy association representing all facets of the African oil and gas industry, will be on the ground to bring you the front row access to the over 20 sessions that will hold in the 4-day event.

Here are 3 of the top-recommended sessions to watch out for, which we believe will have a wide global impact and firmly place the West African country on the top burner, and certainly on the continent.

Launch of the National Gas Transportation Network Code

Nigeria’s Ministry of Petroleum Resources, in conjunction with the Department of Petroleum Resources, will formally launch the National Gas Transportation Network Code as part of the opening events of the NIPS.

Nigeria recently proclaimed the year 2020 as its year of gas, a move that NJ Ayuk, Executive Chairman of the African Energy Chamber noted could become “the most relevant political action anyone has taken in Nigeria in years”.

The National Gas Transportation Network Code aims to ensure that the wrong quality of gas does not go into the pipeline, in addition to guaranteeing gas pipeline integrity, open access to pipelines and common understanding on metering.

It is also expected to provide a uniform platform in terms of guidelines for agreements between buyers and sellers which will ensure transparency and eliminate existing bottlenecks.

We look forward to the launch and hope that it will rightly position Nigeria to experience 2020 as its Year of Gas. 

Ministerial Session: Technology, Policies and Investment – A Conversation

This is perhaps the most important session as it will bring together Oil and Gas Sector cabinet Ministers from Equatorial Guinea, Gabon, Egypt, Libya, Algeria, THE Republic of Congo, Mali, Mauritania and Nigeria, and the OPEC Scribe in a genuine and honest conversation that will perhaps speak to the overarching theme of this year’s conference: “Widening the Integration Circle”.

It will seek to provide a high-level response to such questions as: how Africa can evolve into a significant actor on both the regional and international energy stage and how oil-producing and oil-consuming countries can better cooperate in Africa, amongst others.

Governors’ Forum: What More Can We Expect from the Oil Bearing States?

This session will put the Governors’ of oil-bearing states in Nigeria on the spot during the Governors’ Forum segment to match the opportunities as oil-bearing states and interrogate their various roadmaps on what should be and where they are headed to.

The discovery of oil and gas deposits in Nigeria has been viewed as both a blessing and a curse for the Nation with the insecurity seen as the greatest challenge right next to environmental degradation.

The expected outcome of this session will be the new solutions that will be proffered to create a conducive environment for the investments that will grow the Nation’s hydrocarbon reserves and drive development.

Last Words

James Shindi, the Managing Director of Brevity Anderson, the event producer, in reference to the conference, recently stated that “It has been our tradition from inception. We gather the best brains and key policymakers from across the continent to chart the way forward and posit strategies for the management of Africa’s huge hydrocarbon resources.” We look forward to this year’s edition and will be on the ground to appraise the delivery.

African Economic Outlook 2020 Positive Despite External Shocks

Africa’s economic growth remained stable in 2019 at 3.4 percent and is on course to pick up to 3.9 percent in 2020 and 4.1 percent in 2021, the African Development Bank’s 2020 African Economic Outlook (AEO) revealed Thursday.

The slower than expected growth is partly due to the moderate expansion of the continent’s “big five” — Algeria, Egypt, Morocco, Nigeria, and South Africa – whose joint growth was an average rate of 3.1 percent, compared with the average of 4.0 percent for the rest of the continent.

The Bank’s flagship publication, published annually since 2003, provides headline numbers on Africa’s economic performance and outlook. The 2020 edition, launched at the Bank’s Abidjan headquarters, was attended by former Liberian president Ellen Johnson Sirleaf, African ministers, diplomats, researchers, and representatives of various international bodies.

Johnson Sirleaf commended the Bank for upholding the confidence of the people of the continent “… because we trust you. As simple as that. Because we trust you to share our vision. We trust you to understand our limitations.”

Referring to Africa’s fastest-growing economies, she said, “There are stars among us…and we want to applaud them. We want to see more, particularly for countries like mine, which have been left behind, so that more can be done to give them the support that they need.”

In 2019, for the first time in a decade, investment expenditure, rather than consumption, accounted for over 50% of GDP growth. This shift can help sustain and potentially accelerate future growth in Africa, increase the continent’s current and future productive base, while improving productivity of the workforce.

Overall, the forecast described the continent’s growth fundamentals as improved, driven by a gradual shift toward investments and net exports, and away from private consumption.

East Africa maintained its lead as the continent’s fastest-growing region, with average growth estimated at 5.0 percent in 2019; North Africa was the second fastest, at 4.1 percent, while West Africa’s growth rose to 3.7 percent in 2019, up from 3.4 percent the year before.

Central Africa grew at 3.2 percent in 2019, up from 2.7 percent in 2018, while Southern Africa’s growth slowed considerably over the same period, from 1.2 percent to 0.7 percent, dragged down by the devastating cyclones Idai and Kenneth.

Urgent call to address Africa’s education, skills mismatch

The 2020 AEO, themed Developing Africa’s workforce for the future, calls for swift action to address human capital development in African countries, where the quantity and quality of human capital is much lower than in other regions of the world. 

The report also noted the urgent need for capacity building and offers several policy recommendations, which include that states invest more in education and infrastructure to reap the highest returns in long-term GDP growth. Developing a demand-driven productive workforce to meet industry needs, is another essential requirement.

“Africa needs to build skills in information and communication technology and in science, technology, engineering, and mathematics. The Fourth Industrial Revolution will place increasing demands on educational systems that are producing graduates versed in these skills,” the report noted.

To keep the current level of unemployment constant, Africa needs to create 12 million jobs every year, according to the report. With rapid technological change expected to disrupt labour markets further, it is urgent that countries address fundamental bottlenecks to creating human capital, the report said.

“Youth unemployment must be given top priority. With 12 million graduates entering the labour market each year and only 3 million of them getting jobs, the mountain of youth unemployment is rising annually,” said Akinwumi Adesina, African Development Bank President, who unveiled the report.

“Let’s look at the real lives beyond the statistics. Let’s hear their voices, let’s feel their aspirations.”

Although many countries experienced strong growth indicators, relatively few posted significant declines in extreme poverty and inequality, which remain higher than in other regions of the world.

Essentially, inclusive growth — registering faster average consumption for the poor and lower inequality between different population segments — occurred in only 18 of 48 African countries with data.

“As we enter a new decade, the African Development Bank looks to our people. Africa is blessed with resources but its future lies in its people…education is the great equaliser. Only by developing our workforce will we make a dent in poverty, close the income gap between rich and poor, and adopt new technologies to create jobs in knowledge-intensive sectors,” said Hanan Morsy, Director of the Macroeconomic Policy, Forecasting and Research Department at the Bank.

The African Economic Outlook provides compelling up-to-date evidence and analytics to inform and support African decision makers. The publication has built a strong profile as a tool for economic intelligence, policy dialogue and operational effectiveness.

E. Guinea To Boss Cross-Border Gas Cooperation In Gulf Of Guinea

Equatorial Guinea is positioning itself as a hub for gas in the Gulf of Guinea and hopes to deliver where others have failed: developing the first successful cross-border gas venture on the continent.

Gas is a key priority for Equatorial Guinea and its neighbors. While Cameroon brought on stream Africa’s first Floating LNG project in 2018, Nigeria has declared 2020 the Year of Gas and both countries continue to push for the development of a gas-based economy.

On its side, Equatorial Guinea launched Africa’s first offshore gas mega hub last year when it signed Definitive Agreements with Marathon Oil, Noble Energy, Atlas Petroleum, Glencore and Gunvor to process stranded gas from its Alen and Aseng gas fields, and offset production decline at the country’s Alba field.

The project is of strategic importance for Equatorial Guinea because the Alba field had been until now the sole supplier of gas to its Punta Europa complex, which feeds several industries including an LNG train and a methanol production unit, both seeking expansion.

But such receiving infrastructure could also be a godsend for Nigeria and Cameroun who both have several stranded gas fields right across Equatorial Guinea’s maritime boundary and in need of off-take infrastructure.

Equatorial Guinea’s vision for gas is simple: it wants to become that gas mega-hub for the sub-region by developing several offshore hubs to monetize neighboring gas reserves and develop downstream gas industries spurring industrial development and economic growth.

At home, its industries need gas. EG LNG needs long-term gas supplies for its existing LNG export facility and is considering the development of a second LNG train. Meanwhile, the Atlantic Methanol Production Company has agreed to support the ongoing Year of Investment initiative by expanding its methanol production unit and diversify output into methanol derivatives.

As demand for gas grows, Equatorial Guinea’s message to its neighbors is very straightforward: we provide the processing and off-take infrastructure, you provide the feedstock.

While similar projects have been developed in Africa before, they have fallen short of expectations. The West Africa Gas Pipeline for instance is the first regional natural gas transmission system on the continent, yet remains unable to deliver stable gas supplies to Benin, Togo and Ghana.

The gas mega hub Equatorial Guinea is developing in the Gulf of Guinea will have its own challenges. Nigeria does not belong to OHADA and operates under a different legal regime than that of Equatorial Guinea and Cameroon. The three countries also have different petroleum legislations, fiscal regimes and PSC terms. These are all factors that need to be addressed to turn vision into reality.

In a multilateral meeting in Malabo on Wednesday, H.E. Gabriel Mbaga Obiang Lima, Minister of Mines and Hydrocarbons of Equatorial Guinea, took a proactive step in creating an Executive Committee tasked with the acceleration of the progress of the gas mega hub.

The team is also tasked with ensuring that gas be transported in and outside of the region. The meeting, which gathered Marathon Oil, EG LNG and state-owned entities like GEPetrol and Sonagas, sends a clear signal that a public-private partnership is in the making.

What is left to be seen is if Minister Obiang Lima can put a deal together to bring stranded, associated and even flared Nigerian gas to EG LNG on Bioko Island. The same will be said of the Etinde gas from Cameroon.

Nigeria and Cameroon have enough gas, but its viable commercialization lies across the neighboring maritime border with a facility like EG LNG.

Similarly, the ability of Nigerian Petroleum Resources Minister H.E Chief Timipre Sylva to make a deal work is key to the realization of Nigeria and Equatorial Guinea’s gas dreams.

Africa Oil & Power To Discuss Renewables, LNG & Energy Finance In Cape Town

Africa Oil & Power 2020 highlights African integration across borders throughout the entire energy value chain; AOP 2020 welcomes presidents, ministers, national oil company and utility heads, IPP and renewables executives and more for the fifth edition of Africa’s Energy Conference; This year’s event will have a major focus on the driving factors behind Africa’s energy transition.

The fifth edition of Africa Oil & Power (AOP) returns to Cape Town on September 15-17, for three days of deal-making and discussions focused on Africa’s energy transition, industrialization, regional business and economic transformation.

For the first time, AOP will host the Africa Renewables Forum, the Africa LNG Forum and the Energy Finance Forum, in line with the vision of South Africa’s Department of Mineral Resources and Energy and government and private sector partners from all four corners of the continent.

The theme of this year’s conference, marking the entering into force of the African Continental Free Trade Area, is #InvestWithoutBoundaries. AOP 2020 is the only conference on the continent that fully unites power with petroleum, focusing on the driving factors behind Africa’s energy transition.

“AOP 2020 is the meeting place for Africa’s government officials, global investors and executives, to get deals done and continue moving the continent forward. This year’s conference will encompass the entire energy value chain, including the economic significance of expanding oil and gas exploration, the role of gas-to-power in electrifying Africa; the need to fully utilize and integrate renewables and the importance of using energy to spur growth and economic development throughout the continent,” says Africa Oil & Power Acting CEO, James Chester.

With the African Continental Free Trade Agreement now in its operational phase – establishing a single African market that encompasses the free trade of goods and movement between 54 countries – cross-border trade on the continent will lure investment, encourage job creation and place an emphasis on the need for new technology and cross-border collaboration.

Industry leaders will discuss gas exploration and production throughout the continent with countries including Mozambique, Ghana, South Africa and Equatorial Guinea positioning themselves as major gas players in Africa.

The Mozambique-based Rovuma LNG project envisages a 15 million ton per annum two-train facility, taking gas from its offshore area 4 block. Led by Eni and ExxonMobil, the Rovuma LNG project will develop reliable, affordable energy in the form of liquefied natural gas and transform the future of Mozambique. The final investment decision on the project will be made this year, with operations expected to begin in 20205.

Italian multinational oil and gas company ENI’s Offshore Cape Three Points (OCTP) project in Ghana reached full production in 2019, producing 80,000 barrels of oil equivalent per day. OCTP will provide domestic gas supply to national thermal power plants for more than 15 years, addressing energy requirements in urban and rural areas.

Additionally, South Africa’s first LNG hub is set to be developed at the Coega Special Economic Zone in Port Elizabeth, which will stimulate the country’s gas economy and enhance energy security.

Equatorial Guinea, meanwhile, is pioneering gas development and trade in West and Central Africa through the construction of an LNG storage and regasification plant at the Port of Akonikien under the LNG2Africa initiative.

The use of renewable energy in Africa is rapidly increasing. South Africa’s Renewable Energy Independent Power Producer Procurement program has played a fundamental role in the country’s economic growth and providing an alternative form of energy. The hugely successful program has, to date, attracted R209.4 billion in investment and created over 38,000 jobs.

“The launch of the Africa Renewables Forum, the Africa LNG Forum and the Energy Finance Forum at AOP 2020 bring new and diverse energy sector audiences together on a single stage and in a single venue,” said Chester. “AOP brings new technology to Africa and stimulates new collaboration and trade on the continent. This is the platform where the next generation of projects and deals are initiated and advanced.”

Equatorial Guinea Outlines Oil & Gas Asian Investment Strategy

Ahead of the Atlantic Council Global Energy Forum in Abu Dhabi, Minister of Mines and Hydrocarbons of Equatorial Guinea, H.E. Gabriel Mbaga Obiang Lima outlined the country’s Asia-focused investment strategy following successful high-level discussions with state-owned oil and gas company Petro Vietnam and other Asian companies based in the United Arab Emirates.

During the meeting, Minister Obiang Lima said the energy investment drive into Equatorial Guinea does not have to be China-centric. He committed to visit the Southeast Asian country as well as other neighbouring countries as part of the investment drive.

“Equatorial Guinea has built a successful relationship with several Asian countries. Our approach is one of diversification with our investment partners. We welcome all interested private and public companies in Equatorial Guinea. Africa and Asia have a lot to learn from each other when it comes to oil & gas and energy sector development,” the Minister declared.

“Equatorial Guinea is particularly inspired by the success story of Singapore and sees lots of potential to position itself as a trading, manufacturing and investment hub in West and Central Africa in the same way as Singapore positioned itself in Asia.”

With an existing presence in Malaysia through its petroleum training initiative where hundreds of students are receiving industry education in Kuala Lumpur, Minister Obiang Lima said he is looking at various initiatives which will diversify the economy with the help of local communities.

To this, he noted that the existing relationship has already seen successful business relationships with private companies such as Weststar Aviation – an airline company based in Malaysia – who have established operations in Equatorial Guinea since taking over from Canadian Helicopters.

In building a robust services sector on the African continent and centering the Central African country as a regional hub for gas development, Equatorial Guinea has set out to target and build relationships with Singapore in particular, which comes as a continued vision since the Minister’s last visit to the country last November where the Oil Industry has a long historical relationship with fabrication of several FPSO already working in Equatorial Guinea.

Nigeria Set To Advance Gas Plans During NIPS Conference

Last month, Nigeria’s Minister of State for Petroleum Resources, H.E. Chief Timipre Sylva declared 2020 as the Year of Gas for the West African Nation.

In line with this initiative, the Minister and the Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kolo Kyari, led by Nigeria’s President Muhammadu Buhari will host the third annual Nigeria International Petroleum Summit (NIPS) which will take place on February 9-12, 2020 in Abuja, Nigeria.

Determined to showcase Nigeria as the foremost oil and gas investment destination, the conference will feature a spotlight session on the Nigeria LNG Train-7 project, which recently reached the final investment decision on the major gas expansion deal that is set to boost the plant’s production capacity to 30 million tonnes per annum (mtpa), from the current 22.5 mtpa.

Further, NIPS will provide the opportunity for the nation to outline how local companies can lend a hand in the advancement of the country’s petroleum industry as it works to boost its output.

“Attracting over 5000 international energy industry executives, NIPS is the most opportune space for Nigeria to communicate its growth and development plans, more so since the Honorable Minister declared 2020 as the year of gas for the country,” said NJ Ayuk, Executive Chairman of the African Energy Chamber and CEO of the Centurion Law Group.

“Following the recent $10 billion investment on Train-7 which will enable the NLNG processing unit to remain the fifth-largest supplier of LNG in the world, Nigeria is right to build on this momentum,” he added.

The 2020 installment of the NIPS conference will be anchored by the theme, Widening the Integration Circle: Technology, Knowledge, Sustainability and Partnership and will present strategies and opportunities for growth in oil, gas and energy technologies as well as showcase major contract signings.

Speaker highlights include Former Minister of State for Petroleum Resources, Nigeria, Emmanuel Ibe Kachikwu; Dr. Omar Farouk Ibrahim, OPEC Governor for Nigeria; Dr. Sun Xiansheng, Secretary General, International Energy Forum; Jean-Marc Thystère Tchicaya, Minister of Hydrocarbons, Republic of the Congo and Gabriel Mbaga Obiang Lima, Minister of Mines and Hydrocarbons Republic of Equatorial Guinea.

What Will It Take For 2020 To Truly Be The Year Of Gas In Nigeria?

By NJ Ayuk

“The Honorable Minister of State for Petroleum Resources, H.E. Chief Timipre Sylva has declared 2020 as the year of Gas for the Nation”, the news piece started. What amazing news! And certainly long overdue. As it seems, Nigerian officials have finally taken the cue. As I have said ever so often, more than an oil nation, Nigeria is a gas nation. It just doesn’t act like it.

Undoubtedly, natural gas has the enormous potential to diversify and grow the Nigerian economy, power its industries and homes, produce ever-so-lacking wealth, create jobs, develop associated industries in the petrochemical sector, raise people out of poverty, the list goes on.

Mr. Sylva’s demonstrated intent could perhaps become the most relevant political action anyone has taken in Nigeria in years and could change the country forever; and yet, the work ahead is so vast, we can only hope he has the strength to pull it off.

To be sure, naming 2020 the year of gas for Nigeria has a really nice ring to it, but marketing alone will not cut it. Concerted governmental action is essential if we are to see true growth in the liquefied petroleum gas (LPG) sector, and first of all, we need to see a conclusion to the long delayed Nigerian Gas Flare Commercialisation Programme. Sylva stated that this was his main priority, so let’s hope it happens soon.

Once the programme is cleared, oil producers will have a more conclusive alternative to flaring. They will be able to monetize a resource that has so far been wasted, but still that will not suffice.

The flaring issue in Nigeria is tremendous. Every year, 2 million tonnes of LPG are flared, instead of being used as a source of power or feedstock. That means millions of dollars literally going up in smoke. Nigeria’s zero-flaring programme has been on-going for years, and yet, the Nigerian National Petroleum Corporation (NNPC) has just released results that indicate that gas flaring has been consistently increasing over time. More specifically, “a total of 276.04 billion cubic feet (bcf) of natural gas was flared from Nigeria's oil fields between September 2018 and September 2019”.

Further, NNPC stated that “the volume of gas flared within this period was more than what was supplied to power generation companies for electricity production which was 275.31bcf”. This is taking place in a country where 45% of the population does not have access to electricity, besides the extremely detrimental effect that has on businesses ability to compete and the extraordinary environmental damage that represents.

Already, the federal government announced in August that it would not be able to fulfill its Zero Routine Flaring target by 2020 and is yet to provide a new deadline for this goal to be achieved.

The problem remains the same as ever. It is much, much cheaper for producers to flare up and pay the fines than do anything about it. This can not continue to be. Stronger action is needed and it falls on Mr. Sylva’s leadership to see it done.

I don’t mean by this to point the finger at oil producers. Most would probably want to monetize that resource, and would if they could. But we lack legislation, infrastructure, pricing regulations, and actors ready to receive the feedstock. They can’t just pipe the gas somewhere and hope for the best. We need to focus on deepening domestic gas penetration and promote adoption amongst the population, foster the development of gas associated industries like ammonia and urea plants, use this resource for power generation, etc. Demand doesn’t grow out of nowhere.

For this to workout, everybody needs to work together. That means the ministry and the NNPC need to partner with the international oil companies, the indigenous oil companies as well as with the country’s financial institutions to create the solutions that can make this industry flourish. That is a tall job, but an essential one.

Of course, the news that the output of liquefied natural gas (LNG) coming from the Bonny LNG-plant is going to expand by 35% once the 7th LNG train is operational is fantastic. Nigeria will strengthen its position as one of the world’s biggest LNG exporters and that will bring considerable wealth for the country, but its people continue to be in the dark.

And LNG expansion projects are something IOCs are well prepared to do, but there are other important roles in boosting the gas industry that have to be taken by others.

I speak of course of marginal field development, a topic that is of fundamental importance to me and that I have extensively covered in my most recent book Billions at Play: The Future of African Oil and Doing Deals. Both for oil and gas, Nigeria’s marginal field development programme showed incredible promise when it was first launched in 2013.

It gave opportunities to local companies to explore smaller discoveries that were uninteresting for the majors, which in turn allowed them to gain experience in leading exploration and production projects on their own. Further, it opened opportunities for domestic use of natural gas for power generation. That programme is now being copied by Angola, and yet, it has stalled in Nigeria.

Further, as I have extensively debated over the years, and most extensively in Billions at Play, we need to dramatically invest in Nigeria’s ability to negotiate and manage contracts. This applies both to the need to respect the sanctity of contracts, a fundamental part of giving international investors the confidence to trust that what they sign for will be respected, but also learning to choose who to sign contracts with. The current debacle with P&ID, an unknown little company that has managed to sue the Nigerian government for breach of contract in the English courts and is seeking USD$9.6 billion in compensation, is an incomprehensible situation that should never have taken place. We need to know who our partners are and who we should be signing contracts with, and then stick by them.

Only by combining the role of the majors, the indigenous companies, the necessary infrastructure development for gas transportation, bridging with the nation’s banks to help finance projects and by giving a clear legal framework to the sector, can we hope to succeed. I do not doubt that this is possible to accomplish in 2020 and the years to come, but coming from the experience of recent years, it does not seem probable, and no one pays the price for that more than everyday Nigerians, that continue to fail to benefit from its country’s resources.

Action is necessary as a matter of urgency.

This week it was disclosed that international oil and gas companies were holding back an estimated USD$58.4 billion in investments in oil and gas projects in Nigeria because of regulatory uncertainty. Foreign Direct Investment in Nigeria was USD$1.9 billion in 2018. It’s not like we don’t need the money.

But how can we expect international oil companies to feel comfortable signing off on billions in investment if after 20-plus years of negotiations we still haven’t managed to settle on the Petroleum Industry Bill that will oversee the sector? Who can blame them for waiting to see what happens? They are waiting for us to figure out how we want to regulate the industry, and after 20 years, we still don’t seem to know. That has to change, and soon.

Nigeria has an estimated 200 trillion cubic feet of gas reserves. It is high-time to put them to use. With the right policies we could change the face of the country completely. We could give light to our people, we could power our industries, releasing them from the handicapping dependency on diesel generators that make it all but impossible for them to be competitive, we could relinquish ourselves from our dependency on imported fuel for power and heat, we could create new opportunities for job creation and industrial development, we could take millions of people out of poverty...

Further, strong domestic gas and gas-based industries could help boost intra-African trade, create new synergies with our neighbours, boost integration of power generation networks, establish new partnerships, even contribute to peace.

What I am saying, I say as an African, and it applies to many countries across the continent. However, Nigeria is in a prime position to truly enact change and be a beacon to others by showing leadership and resolve. It is the continent’s biggest economy and has the continent’s biggest reserves of hydrocarbons, both oil and gas. NNPC already works with some of the best major IOCs and the country has Africa’s best and most developed indigenous exploration and production capabilities. Let’s give ourselves the opportunity to be better and to live better, by taking advantage of the resources we already possess.

Mr. Sylva is showing leadership and drive. So far, he has proven himself to be the leader that Nigeria needs to develop new LPG and LNG industries that will take the country to the next level of development, not only economically speaking, but socially, environmentally, humanly. So let’s hope he can pull through the great transformations that need to occur for 2020 to truly be Nigeria’s year of gas.

NJ Ayuk is the Executive Chairman of the African Energy Chamber and author of Amazon best-selling book, Billions at Play: The Future of African Energy and Doing Deals.

Waltersmith Modular Refinery Set To Meet The Scheduled Deadline

Phase one of the modular refinery and the ground breaking ceremony of the phase two is expected to hold in May 2020; The Waltersmith project has already reached 90 percent completion; The project falls in line with H.E. Chief Timipre Sylva's objectives to foster private sector participation in increasing domestic refinery capacity.

Last week, Nigeria's Minister of State for Petroleum Resources, H.E. Chief Timipre Sylva paid an inspection visit to the Waltersmith Modular Refinery in Ohaji/Egbema LGA, Imo State.

Accompanied by Executive Secretary of the Nigerian Content Development Monitoring Board (NCDMB) Engr. Simbi K. Wabote, Minister Sylva said the Federal Government would continue on its efforts to ensure that the project meets the set deadline where phase one (5,000 bpd) of the modular refinery and the groundbreaking ceremony of phase two, which is targeted at delivering 25,000 bpd crude and condensate refinery; designed to produce gasoline, diesel, LPG, kerosene and aviation fuel, is expected in May 2020.

The minister said that the overall expectation of the site visit where the project that has already reached 90 percent completion, "was to see indigenous Nigerian Companies do well and the Waltersmith Modular Refinery is a major bright spot which has recently been incorporated into the Nation's projection for petroleum product sufficiency and availability."

Further, the minister directed that the NCMB and Waltersmith Petroman Oil Limited (Waltersmith) should centre their attention to corporate social responsibility which will ensure a "sustained and successful relationship with the host community."

To this, AbdulRazaq Isa, Chairman of Waltersmith said the project's first phase would create several direct and indirect jobs for the host community.

"This project is crucial for the development of the refining sector on the continent. Alongside the Dangote refinery which is slated for completion in early 2021, Nigeria is quickly setting an example for the role private investment stands to play in the development of the industry's capabilities," said NJ Ayuk, Executive Chairman of the African Energy Chamber.

"Nigeria is Africa's largest crude producer, yet it lacks the refining capacity to meet its own fuel needs and through projects like these, the country is effectively making the move towards addressing this issue," he added.

The public-partnership sees Waltersmith holding a 70 percent interest while NCDMB holds the remaining 30 percent.

One of the main drives for the development of this project include the crude loss which comes as a result of crude handling and the cost of crude transportation from the marginal fields owned by Waltersmith, said AbdulRazaq Isa who also explained that the first phase of the project is expected to contribute an estimated 271 million litres of refined products including Diesel, Naphtha, HFO and Kerosene annually to the domestic market.

The project reached FID in September 2018 with an 18-month Delivery time from November 2018 to May 2020, for phase one.

Waltersmith Petroman Oil Limited is a wholly owned Nigerian integrated energy company. It is operator of the 7000 bpd Ibigwe field located on the OML 16 in the eastern Niger Delta and is also active in the OML 34 in Niger Delta Western Ltd where it holds a 8.33 percent stake.

Following a competitive bidding process in EGRonda 2019, the company was awarded a 40 percent stake in Block EG-23 earlier this month, allowing it to take operatorship of the asset.

The Block is located in Equatorial Guinea's Niger Delta basin. This acquisition forms part of the company's expansion plan which will see it venture further into Africa as it works to participate in accelerated production and extended value creation.

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