Energy
NCDMB, BOI sign amendment of MoU on $50m NOGaPS manufacturing fund
The Nigerian Content Development and Monitoring Board (NCDMB) and the Bank of Industry (BoI) have signed an amendment to the Memorandum of Understanding (MoU) on the $50million NOGaPS Manufacturing Fund.
The Fund was created by the NCDMB and domiciled with BoI to attract oil and gas equipment manufacturers to the Nigerian Oil and Gas Parks Scheme (NOGaPS) facilities established by the NCDMB, and increase access to affordable finance by the manufacturing entities.
The signing of the amended MoU took place in Lagos on Friday at the 2023 second quarter Review Meeting of the Nigerian Content Intervention Fund (NCIFund).
In his remarks, the Executive Secretary, NCDMB, Engr Simbi Kesiye Wabote underlined the tremendous success of the NCIFund in catalysing capacity development and investments in the Nigerian oil and gas industry.
He hinted that the Fund serves as a model for local content practice across the African continent and inspired the creation of the African Energy Bank by the African Petroleum Producers Organization (APPO), in partnership with the African Export Bank (Afreximbank).
He added that countries like Angola and Namibia are currently engaging the Board, with a view to understand the workings of the NCI Fund, so as to replicate same in their jurisdictions.
In Wabote’s words: “Today, Angola is thinking of establishing a similar credit line for their oil and gas companies. I think the parliament recently approved some sum of money for them to manage in that respect. Namibia is planning to do the same with the potential enactment of a Local Content Act.”
Wabote further commended the Bank of Industry for the successes being recording in the management of the NCI Fund, assuring that the Board will continue to look for other opportunities to increase its partnership with BoI.
He said, “Considering the effectiveness and success recorded by BoI, NCDMB may consider inviting BoI to send a nominee that will act as independent Director to the Board of Directors of some of the companies that we have invested equity in. This will help them overcome some of the prevailing issues around governance, liquidity and technical optimisation.”
On his part, the Managing Director of the Bank of Industry, Mr Olukayode Pitan expressed confidence in the future performance of the Board’s funds domiciled in the bank while noting that these quarterly review meetings will impact on sustaining the effective disbursements and recovery of these funds.
According to him, the NCI Fund is performing excellently with 194 applications equalling US$1 billion /¦ 80.6 billion with 69 disbursements totalling US$324 million /¦ 38.4 billion as at the day of reporting.
The Board established the NCI Fund in 2018 with the purpose of financing Oil and Gas companies to increase capacity and grow Nigerian Content in the Industry Presently, the NCI Fund has five product lines which are being managed by the Bank of Industry. They include – Manufacturing Finance -$10m; Asset Acquisition Finance -$10m; Contract Finance -$5m; Loan Refinance -$10m and Community Contractor Finance – ¦ 20 million.
The US$50 million NOGaPS Fund was launched as a separate product in March 2023 to incentivise companies that will be domiciled and manufacture oil and gas equipment components within the NCDMB oil and gas parks being established at different locations across the country, with the sites in Bayelsa and Cross River State open for occupation.
The Board also has a US$30 million Working Capital Fund for oil and gas service companies and US$20m Fund for Women in Oil and Gas Intervention Fund. The last two facilities are administered by the Nexim Nigerian Export-Import Bank and the agreements were signed in mid-2021.
The Nigerian National Petroleum Company Limited, NNPCL, has declared a state of emergency on crude oil production.
Group Chief Executive Officer of NNPCL, Mele Kyari, made this known on Tuesday in a keynote address at the opening ceremony of the 23rd edition of the Nigeria Oil and Gas Conference and Exhibition (NOG Energy Week) in Abuja.
According to him: “We have decided to stop the debate. We have declared war on the challenges affecting our crude oil production. War means war. We have the right tools. We know what to fight. We know what we have to do at the level of assets. We have engaged our partners. And we will work together to improve the situation.”
Kyari further stated that a detailed asset analysis revealed Nigeria can produce two million barrels of crude oil per day without deploying new rigs, adding that the primary obstacle is the inability of industry players to act promptly.
The NNPCL boss said the war will make the company and its partners immediately remove all identified barriers to efficient production, including delays in procurement processes, which have become a challenge in the industry.
Speaking on the medium- to long-term measures to boost and sustain production, Kyari said NNPC will replace all the old crude oil pipelines built over four decades ago.
He said the company will also introduce a rig-sharing programme with its partners to ensure that production rigs stay in the country for between four and five years, which is the standard practice in most countries.
The NNPC boss urged all players in the industry to synergize towards reducing the cost of production and enhancing production to target levels.
He reiterated the company’s commitment to investing in critical midstream gas infrastructure such as the Obiafu-Obrikom-Oben (OB3) and the Ajaokuta-Kaduna-Kano gas pipelines to boost domestic gas production and supply for power generation, industrial development and the economic prosperity of the country.
He said NNPCL has since keyed into the presidential compressed natural gas (CNG) drive, and, in collaboration with partners like NIPCO Gas, has constructed several CNG stations.
The Organisation of the Petroleum Exporting Countries (OPEC) says energy demand will rise by an estimated 23 per cent by 2025.
OPEC says the rise will be fueled by a world economy that is expected to double in size, growing from $138 trillion dollars in 2023 to $270 trillion dollars in 2045.
The OPEC Secretary-General, Haitham Al Ghais, made this known on Tuesday at the ongoing 23rd Nigerian Oil and Gas (NOG) Energy Week Conference and Exhibition, holding in Abuja.
The conference, which holds from June 30 to July 4, has its theme as “Showcasing Opportunities, Driving Investment, Meeting Energy Demand”.
Addressing the Strategic Conference via teleconference, Al Ghais explained that it forecasted a rapidly expanding world population that would surpass 9.5 billion people.
“Why are we optimistic? Let us consider these statistics, which are based on OPEC’s World Oil Outlook.
“Urbanisation alone will account for over half a billion people moving to cities around the world by 2030.
“This data tells us that the world will require all forms of energy to meet long-term energy needs.
“Oil and gas will remain the predominant fuels in the energy mix.
“In fact, oil alone will retain its share at almost 30 per cent in 2045 as world demand for oil soars to an estimated 116 million barrels per day (mb/d) by that time,” he said.
To meet this rapid and robust growth in energy consumption, he said the industry would need to boost investment levels significantly in the years to come.
He said according to its research, cumulative oil-related investment requirements from 2024 until 2045 would amount to $14 trillion dollars or around $610 billion dollars on average per year.
“Securing this vital funding is essential to maintaining security of supply and avoiding unwanted volatility.
“In spite of these facts, I am certain you are aware of some recent predictions for peak demand by 2030 and calls for a discontinuation of investment in hydrocarbons,” he said.
Al Ghais further emphasised that indeed, the rush to adopt “Net-Zero” strategies was misguided and simply not realistic.
The OPEC Secretary General said that developing countries would continue to balance priorities between developing their national economies and addressing climate change.
In this regard, he pledged that OPEC and its member countries would continue to advocate for a fair process for adaptation, mitigation and means of implementation, with regard to climate finance and technology.
He decried the fact that there were an estimated 675 million people with no access to basic forms of energy and 2.3 billion without access to clean cooking fuels.
He tasked World leaders to unite and advocate for the necessary support and resources to make a difference in addressing this important matter.
“Looking ahead, OPEC will continue to enhance dialogue and cooperation with all of its energy partners, including in Africa,” Al Ghais said.
The Secretary-General, while commending President Bola Tinubu, appreciated Nigeria’s staunch commitment to OPEC and to the Declaration of Cooperation.
By Esther Agbo
The 23rd Annual Nigeria Oil and Gas (NOG) Conference in Abuja commenced with a keynote address by the Honourable Minister of State for Petroleum Resources (Gas), Rt Hon. Ekperikpe Ekpo.
The event, themed “Showcasing Opportunities. Driving Investment. Meeting Energy Demand,” highlighted the Ministry’s ambitious plans for Nigeria’s gas sector, underlining its pivotal role in the nation’s economic and energy future.
In his speech, Minister Ekpo emphasized the Ministry’s commitment to unlocking the potential of Nigeria’s substantial gas reserves, which stand at 209 trillion cubic feet (tcf). “Our natural gas reserves are among the largest globally,” he stated, “offering immense possibilities for exploration, production, and utilization.”
He pointed out that the Ministry is dedicated to fostering an environment that promotes growth, innovation, and investment within the sector.
A major focus of the address was the Ministry’s efforts to spotlight the vast opportunities within Nigeria’s gas sector. Minister Ekpo outlined strategic initiatives aimed at promoting gas-based industries such as fertilizers, petrochemicals, and methanol. These industries not only diversify Nigeria’s economy but also create significant employment opportunities. The conference serves as a platform to attract global attention and encourage partnerships that can drive growth and development in these areas.
Minister Ekpo highlighted the critical role of investment in the oil and gas sector. He noted the Ministry’s role in implementing reforms, including the Petroleum Industry Act (PIA) 2021 and recent tax incentives directed by President Bola Ahmed Tinubu. These measures, he explained, create a conducive environment for both local and international investors by ensuring transparency, accountability, and regulatory certainty.
A key initiative mentioned was the Midstream and Downstream Gas Infrastructure Fund (MDGIF), designed to catalyze investments in essential infrastructure projects. “By addressing infrastructure gaps, we can significantly enhance the efficiency and reliability of our gas supply chain,” said Minister Ekpo, highlighting the importance of this fund in driving sector growth.
Addressing the nation’s growing energy demands, Minister Ekpo reaffirmed the Ministry’s commitment to leveraging natural gas as a cleaner and more efficient fuel. He said the gas-to-power initiatives are central to this strategy, aiming to provide reliable and affordable electricity that supports industrialization and improves living standards.
Furthermore, the Minister announced the promotion of Compressed Natural Gas (CNG) as a fuel alternative for vehicles, commonly referred to as Autogas. This effort serves not only as a strategic measure to mitigate the impacts of downstream deregulation but also as a pivotal catalyst for market expansion and job creation within Nigeria.
He said, “The transition to Autogas presents numerous benefits, including efficiency, availability, accessibility, versatility, and environmental safety. By fostering the use of CNG and Liquefied Petroleum Gas (LPG), we are positioning Nigeria as a leader in clean energy solutions, enhancing both energy security and environmental sustainability.”
The Honourable Minister reiterated the Ministry’s dedication to the Decade of Gas Initiative, an ambitious plan to transform Nigeria into a gas-powered economy by 2030. This initiative aims to optimize the entire gas value chain, from exploration and production to processing and utilization.
“By fostering strategic partnerships and supporting innovative projects, we aim to enhance energy access and drive sustainable development. Our vision is to ensure that every Nigerian has access to affordable and reliable energy, thereby fostering economic growth and improving quality of life.
“This ambitious initiative aims to transform Nigeria into a gas-powered economy by 2030. It involves optimizing the entire gas value chain, from exploration and production to processing and utilization. The Decade of Gas is not just a policy declaration but a strategic vision to harness our gas resources for national development,” Minister Ekpo proclaimed.
In conclusion, Minister Ekpo called on all stakeholders to collaborate, innovate, and invest in Nigeria’s energy future.
He urged, setting a hopeful and determined tone for the conference, “The theme of this year’s conference, “Showcasing Opportunities. Driving Investment. Meeting Energy Demand,” perfectly aligns with the Ministry’s vision and objectives. It is a call to action for all stakeholders to collaborate, innovate, and invest in our shared future.
“The Ministry of Petroleum Resources is committed to leading this charge, ensuring that we leverage our natural resources for sustainable development. Let us embrace the opportunities before us, drive the necessary investments, and meet our energy demands with resilience and innovation.”
The 23rd Annual Nigeria Oil and Gas Conference continues through 4th July, promising further insights and developments from industry leaders and stakeholders.
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