All Posts in "Energy"

Senate Seeks Relocation Of Oil Companies ,Moves To Repeal Electricity Power Sector Reform Act

The Senate has ordered its committees on Petroleum Resources Upstream, Downstream Petroleum Sector and Gas to liaise with the Ministry of Petroleum Resources and the Presidential Implementation Committee on the Petroleum Industry Act (PIA), to facilitate the relocation of oil and gas companies in Nigeria to their various operational bases in host communities to ensure smooth operations.
The upper chamber reached the resolution after it considered a motion on the “Urgent need to encourage all Multinational and Nigerian Oil and Gas Companies to relocate to their Operational Bases.”
The motion was sponsored by Senator Albert Bassey Akpan (PDP, Akwa Ibom North East) and co-sponsored by 23 other Senators.
Bassey expressed   concern that multinational and Nigeria oil and gas companies have over the years been operating from their respective operational bases until militancy and insecurity in the host communities in the Niger  delta became the order of the day.
He said  the reason proffered by the oil and gas companies for not relocating to their host communities has always been due to insecurity and hostilities in the host communities.
He said the Senate was aware that operating outside the host communities and operational base is the reason for the high cost of production which has been the bane of the country’s oil and gas industry, militating against maximum revenue from crude oil and gas sales to the federation account;
He recalled that this high cost of production has been one of the most contentious elements of our industry value chain.
According to him,the Senate  was convinced that the recent passage and signing into law of the Petroleum Industry Act, 2021(PIA) by the National Assembly and the President of the Federal Republic of Nigeria respectively, is a major milestone towards the restoration of a lasting peace in the host communities;
He said that the Petroleum Industry Act, 2021, now place certain responsibilities on the security, peace and safety of oil and gas infrastructure on the host communities to safeguard and ensure peaceful coexistence between oil and gas  companies and their host communities.
He added:“Further convinced that is an opportunity to restore, recover and rehabilitate the massive and huge infrastructural facilities abandoned by the various oil and gas companies in their various operational bases to ensure their full utilization; and assured that the relocation of these companies to their host communities will further boost development in those areas and enhance the corporate social relationships and strengthen out collective resolve to considerably reduce the contentious cost of production and ensure adequate returns to federation account.”
In his contribution,Senator Biobarakuma Degi-Eremienyo (Bayelsa East) said the agitations and problems within the oil and gas producing communities was as a result of their inability to easily access the management of the multinational companies to table complaints.
“I believe that if this motion is passed and implemented, it will go a long way to assuage the yearnings and apprehension of the people within these host communities.
“Mr. President, as a matter of fact, the cause of this situation is that the government of these areas are not even benefitting from the revenue, that is payment of tax, within the localities that they are exploiting this oil and gas, because the workers will claim that they are not resident in these areas.
“The payee is not accruable to the state government. These are some of the things the people suffer on account of locating the headquarters away from the source of the raw materials”, he said.
 Meanwhile,the Senate  has  passed a bill for an Act to repeal the Electricity Power Sector Reform Act 2005.
In his lead debate,sponsor of the Bill, Sen. Gabriel Suswan (PDP-Benue),explained that the bill seeks among others,  to repeal the Electric Power Sector Reform Act 2005.
He added that it also seeks to consolidate all legislations in the Nigerian Electricity Supply Industry (NESI), as it enacts an omnibus electricity act for the industry.
Senator Suswan also explained that the legislation also seeks to provide the framework that would attract more investors to leverage on the gains of the privatised electricity industry in Nigeria.
He said when implemented,it will accelerate growth in power capacity and improve generation of power through increased investment in new technologies leading to enhanced transmission and distribution of power generated while minimizing aggregate value chain loses.
He  said, in spite of the modest milestones recorded in the Nigerian power sector, the sector has not been able to make electricity available to 75 per cent rural population as envisaged in the National Electric Power Policy.
“This is because the sector is currently plagued with a number of challenges some of which are operational constraints that emerged after the privatisation exercise.
He said the bill when passed, would provide the framework for power diversification through the use of cleaner renewable energy sources such as coal, wind, sun and ensure sustainable energy mix.
He said that the privatized power sector in Nigeria was facing a myriad of post-privatisation challenges including the absence of tariffs, inadequate enumeration, metering of consumers, limited access to funds for investment.
Other challenges according to him include high levels of Aggregate Technical Commercial and Collection (ATC &C) losses and poor revenue generation.
“All these constraints have received various interventions by the executive and legislative arms of the federal government over the years.
“But these challenges have continued to threaten the viability of successor companies including their financial capacity to invest in network improvement to guarantee reliable power supply as envisaged in their respective Performance Agreement.”
He said that apart from the operational constraints confronting the post-privatised power sector in Nigeria, the principal act which was the extant legal framework for the industry has some gaps and shortcomings that made it unsuitable to adequately govern activities of the market operator and market participants.
He said that the bill, when passed would provide the framework for power diversification through the use of cleaner renewable energy sources.
“The bill will also eliminate current barriers to private sector investment across the power value chain and attract the funds needed to address the current funding gaps confronting the industry since the privatisation of the power sector,”he said.
The bill, after passing second reading was referred to the Committee on Power by President of Senate Ahmad Lawan for further legislative work.
Online Editor by — September 29, 2021 in Energy 0
 Energy Security: Tshisekedi Commends  Sahara Group, Urges Collaboration In Africa

Energy security: Tshisekedi lauds Sahara Group, urges robust collaboration in Africa -
President Félix Tshisekedi of the Democratic Republic of Congo has commended Sahara Group’s leading role in spearheading enhanced intra-African trade, capacity development, seamless access to products, and deployment of innovative solutions to boost Africa’s march towards energy security.
Describing Sahara Group as a “shining light for Africa” in terms of providing global energy solutions, Tshisekedi said more cooperation between African nations and businesses would enhance the continent’s lobal competitiveness, and ultimately stimulate sustainable development in Africa.
Tshisekedi who addressed the Board of the Sahara Group virtually as part of events to mark Sahara’s 25th anniversary recently, said Africa has a huge potential in the energy sector, adding, “we have what it takes to transform Africa for the benefit of all Africans.”
He said: “It is an honour to join Sahara Group to celebrate its 25th anniversary. The Democratic Republic of Congo is a country with enormous potential, and we are happy to play an important role in the transformation of Africa, working alongside companies like Sahara Group and other African countries.”
Speaking,Executive Director, Sahara Group, Kola Adesina said the energy conglomerate was delighted at the support it continues to receive from the DRC, noting that Sahara remained confident of the ability of Africans taking the driver’s seat in delivering a transformed, economically viable and globally competitive Africa.”
“Our journey over these past 25 years shows that all it takes is for all stakeholders working together in the best interest of Africa, selflessly and committedly. Sahara started out as an oil trading entity and now we are operating with almost 5,000 employees in Africa, Asia, Europe, and the Middle East. We are proud of our African heritage, and we assure Your Excellency of our commitment to working with him to achieve his aspirations as Chairperson of the Africa Union,” he added.
Adesina commended President Tshisekedi for making energy security and investment its top priority, as well as propelling massive hydropower projects to diversify the country’s energy mix to create jobs and grow the economy.
Online Editor by — September 2, 2021 in Energy 0
Fossil Fuel Funding  Drops  In  2020 Amid COVID-19

G20 commits $151B to fossil fuels in COVID-19 packages
Fossil fuel financing fell by 9% in 2020 as the COVID-19 pandemic halted demand and production,report said.
It also said overall bank funding of the fossil fuel industry in 2020 remained higher than in 2016, the year after the 2015 Paris agreement on climate change was signed, according to a new report from a group of environmental advocacy organizations.
In 2020, 60 of the world’s largest commercial and investment banks financed $750.73 billion to the fossil fuel industry, down from $823.68 billion in 2019, but above $709.23 billion in 2016.
Investors and regulators have grown increasingly concerned about long-term climate risks, fearing that if industries like coal and gas become obsolete, financial institutions will be left with stranded assets. As a result, lenders have been adopting policies to phase out fossil fuel funding and to bring their lending into line with the Paris agreement, which aims to limit warming at the end of this century to well below 2 degrees C measured against preindustrial levels, with signatories agreeing to strive for a 1.5-degree C goal.
“The overall fossil fuel financing trend of the last five years is still heading definitively in the wrong direction, reinforcing the need for banks to establish policies that lock in the fossil fuel financing declines of 2020, lest they snap back to business-as-usual in 2021,” the report said.
The sponsors of the report — the Rainforest Action Network, BankTrack, the Indigenous Environmental Network, Oil Change International, Reclaim Finance and the Sierra Club — advocate the complete elimination of funding for fossil fuel projects. The figures come from Bloomberg Finance, energy research consultancy Rystad Energy, and Urgewald, a German environmental nongovernmental organization.
U.S. companies ranked as the largest lenders to fossil fuel projects, with JPMorgan Chase & Co. providing the highest amount of funding between 2016 and 2020. But the bank’s overall fossil fuel financing fell 20% from 2019 to 2020. In October 2020, JPMorgan announced plans to bring its financing into line with the goals of the Paris agreement, which aims to achieve net-zero emissions by 2050. The bank’s fossil fuel financing stood at $51.30 billion in 2020, down from $64.04 billion in 2019 and $63.73 billion in 2016.
Citigroup Inc. provided the second-highest amount of funding to fossil fuels over the five-year stretch. While its lending decreased to $48.39 billion in 2020 from $52.50 billion, it was still higher than the $42.64 billion provided in 2016. At the beginning of March, the bank committed to reach net-zero greenhouse gas emissions by 2050 and will publish an initial net-zero emissions plan within the next year.
Wells Fargo & Co. and Bank of America Corp. took third and fourth position, respectively. Wells Fargo also announced plans in March to reach net-zero emissions by 2050, while Bank of America in February outlined initial steps to achieve net-zero greenhouse gas emissions in its financing, operations and supply chain activities before 2050.
However, the environmental groups said that net-zero commitments are “inadequate” and should be “met with great skepticism unless they are accompanied by 2021 action on coal, oil, and gas.”
Among European lenders, Barclays PLC was ranked as the biggest financer of fossil fuels, while France’s BNP Paribas SA was the 10th-largest. The report noted that French peers Société Générale SA and Crédit Agricole SA had also increased their fossil fuel financing.
French banks are generally regarded as among the leading European lenders in tackling climate change, helped in part by France’s policies on climate change. The country passed a law in 2015 designed to make the financial sector and publicly traded companies more accountable for sustainability. For example, France requires asset managers to report how they account for climate change when making investment decisions. Publicly traded companies must include climate change risks in their financial reporting.
The report also scored banks on their policies, and French banks had among the strongest — BNP Paribas for restricting unconventional oil and gas, and Crédit Agricole for phasing out coal financing. Italy’s UniCredit SpA had the strongest fossil fuel polices overall, the report concluded. Unicredit plans to phase out coal sector financing totally by 2028.
Online Editor by — April 12, 2021 in Energy 0