“Nigeria can generate 3,000MW from flared gas” – DPR report

 

The Department of Petroleum Resources (DPR ) in Nigeria has revealed that additional 3,000 megawatts of electricity can be generated from the current gas being flared in the country.

This is contained in DPR’s report made available at a workshop organised for energy journalists in Lagos state.

The report which explained routine gas flaring as the intentional burning of gas, while non-routine flaring as the need to burn gas due to unexpected emergencies stated that the country currently flares about 11 per cent of its gas production, bringing Nigeria to seventh in the world.

According to the report, if government is able to harness gas currently being flared at the 139 flare locations across the Niger Delta, it would boast of 3,000 MW of electricity in the nearest future.

It explained that solution to gas flaring challenge is for government to construct pipelines, which will harness all gas currently being flared into one position for commercialisation.

To this end, the report explained that government’s current Nigerian Gas Flare Commericlisation (NGFC) programme was geared towards finding markets for gas flared in the country.

The report added that government would be responsible for finding market for gas currently being flared unlike in the past when it was left in the hands of producers.

The report explained that another reason the programme has not been successful is because government left gas flaring commercialisation in the hands of the producers, who do not have much interest in gas.

The Nigerian government is planning to end routine gas flare by 2020.

Wale Tinubu And Oando Plc: A Success Story That Inspires Africa

The Group Chief Executive of Oando Plc, Wale Tinubu keeps winning as he leads the company through another half year on the back of the company’s 41st Annual General Meeting at the Eko Hotel and Suites, Victoria Island, Lagos. The company recorded a gross profit of N51.0 billion in H1 2018, which increased by 53% from N33.4 billion in H1 2017. Commenting on the results, Wale Tinubu said:

“I am pleased to report that Oando PLC has made significant progress in 2018, evidenced by our substantial free cash flow generation and profitability. Oil prices have rallied over the last year, a direct consequence of increasing demand and reduced supply. Higher oil prices and the resolution of Joint Venture funding challenges with the Nigerian National Petroleum Corporation has driven increased investment in the upstream sector. This stable operating environment, coupled with our fiscal prudence, has reinforced our solid financial footing as we continue to build on the momentum garnered in 2017.”

Oando is Nigeria’s leading indigenous energy company and one of Africa’s largest integrated energy solutions provider. The company has a dual listing on the Nigerian Stock Exchange (NSE) and Johannesburg Stock Exchange (JSE). Oando’s impressive performance in the first half of 2018 is a testament to the strong leadership of Wale Tinubu, continuing the outstanding results delivered in 2017.

Further analysis of Oando’s H1 2018 results reveals the following: an 11% increase in turnover to N297.3 billion, with profit after tax (PAT) of N8.5 billion, an increase of 86%.

 

Wale Tinubu and Oando keep defying the odds with each announcement this year. Having since overcome the effects of falling oil prices that affected every company in the industry, Oando is now shooting for the stars with its 7th consecutive quarter of profit. H1 2018 saw a pick up in the oil and gas industry’s recovery after 2017.

Shareholders of Oando Plc have also shown their support for Wale Tinubu and other management of Oando as the company continues to create value for its shareholders. Alhaji Kabiru Tambari, an Oando shareholder with the Sokoto Zone Shareholders Association recently commented: “This result reaffirms my commitment for the management of Oando. Seven profits in a row is no small feat. Not all companies who have gone through what this company has gone through in the last year would be able to come out this strong. I commend the management team, and I hope they continue the good work.”

Oando recently impacted the lives of over 5,000 people in Agbere Community, Bayelsa state by commissioning a 20,000-gallon water scheme in the district. This initiative, in partnership with Oando’s Joint Venture (JV) Partners, NNPC and NAOC, will drastically reduce deadly water-borne diseases in the area.

The Nigerian National Petroleum Corporation (NNPC) recently partnered with Oando and other major oil and gas companies in line with its efforts to improve electricity generation in Nigeria. The companies will work together on the “Seven Critical Gas Development Projects” to strive for the production of 15,000 megawatts of electricity in two years.

With these and other achievements recorded this year, all roads are looking good for Wale Tinubu and Oando.

OPINION: Energy is a key catalyst in moving Africa forward

 

 

JOHANNESBURG – ‘We have to be impatient in moving Africa forward”. These were the words of Akinwumi Ayodeji Adesina, President of the African Development Bank at the World Economic Forum in 2016.

Two years on, this quote is as relevant today as it was when it was spoken in the snow-capped hills of Davos, Switzerland.

I believe that energy can be a key catalyst in moving Africa forward. But first, let’s look at the macro-economic indicators of Africa holistically. Compared with the rest of the world, Africa as a continent has enjoyed “above-average” growth. The aggregated gross domestic product growth (GDP) was 3.6percent for 2017, with a forecast growth of 4.1percent in 2018 (Source: African Development Bank Economic Outlook 2018).

According to the World Bank Report released earlier this year, Ghana and Ethiopia are expected to achieve GDP growth of 8.3percent and 8.2percent, respectively. In fact, the World Bank predicts that Ethiopia economy will double by 2025. (Source – World Bank Global Economic Prospects 2018: Africa analysis)

Admittedly closer to home, South Africa’s economy has seen a -2.2percent contraction in the last quarter. However, the reforms being implemented (especially with respect to state-owned enterprises) should create fertile soil for “green shoots” come 2019 and 2020.

Taking a closer look at the homogeneous challenges facing the African continent, they can be grouped into several principal areas: job creation, food security, water stewardship and climate change.

While these challenges may vary in degree of severity from country to country, their impact is the same. These issues stifle economic growth and create widening gaps of inequality in our citizens. However, shifts in the regulatory environments coupled with innovation, are creating opportunities for addressing these societal ills.

Job creation

In Botswana, legislative changes in 2016 have opened the country’s energy market to Independent Power Producers (IPPs). As we have seen in South Africa, the Renewable Independent Power Producer Programme (Reipppp) has spawned multiple manufacturing and service industries in addition to achieving significant job growth since its inception.

Given Botswana’s unemployment rate of 18.1percent against a population of just more than 2million, a programme like Reipppp would serve to reduce levels of unemployment and create sustainable manufacturing capacity.

The levels of solar radiation in the country and methane gas opportunities resulting from the thriving livestock industry are clear indicators that this country is primed for renewable energy expansion.

Food security

In Kenya the reduction of connection charges and end-user tariffs for both domestic and commercial/industrial consumers is anticipated to alleviate the country’s low levels of electrification. This country is heavily reliant on food produce exports (coffee, tea, spices).

Therefore, there is a need for promoting the use of renewable energy systems for sustainable agriculture. For example, solar photovoltaic water pumps, and solar water heaters can provide irrigation and input into production processes for produce such as milk, as well as staple crops (for example, maize).

As part of accelerating electrification, a programme dubbed the Green Mini Grid (GMG) facility in Kenya has been rolled out. This programme aims to connect 14000 homes and businesses to green mini-grids by the end of 2018.

Water scarcity

Ethiopia, as one of the top five ranked driest countries on earth faces a dire water scarcity threat. With a projected economic growth of above 8percent for 2018, the scarcity of water could throttle economic growth if serious measures are not taken.

Innovation could be Ethiopia’s saviour. For example, the Sahara Forest Project in Australia uses seawater as an energy source. In a nutshell, the seawater is pumped from the sea and dripped over a “honeycomb” structure inside a greenhouse, where it evaporates. The evaporation cools down the indoor environment, while the resulting water vapour condenses on the greenhouse roof forming fresh water.

Emissions

South Africa, as the most industrialised economy, is also understandably the biggest emitter, with emissions states at 468 metric tons of carbon dioxide as at the end of 2016. While the Reipppp has gone some way to reducing the reliance on coal-fired power, more than 70percent of the country’s power comes from fossil-powered generation.

Companies across the country are seeing the benefits of reducing energy costs through the installation of renewable energy solutions, via tax incentives.

Given the capital outlay of installing solar PV systems on large building roofs, such tax incentives help to accelerate the payback period, thereby alleviating the cost for the business.

By harnessing the power of our natural resources, we can unlock endless possibilities for energy, the catalyst for change in Africa.

Two-thirds of Africa’s population still don’t have access to electricity – and it’s threatening the security of the continent

 

…Development aid, military infrastructure and assistance with pushing through crucial reforms will be in vain unless the West helps its African partners eradicate energy poverty…

 

An engineer at the state-run Kenya Generating Company hydro-electricity dam control room at Masinga. Some African governments – Kenya in particular – have embraced policies aimed at bolstering future energy security

 

Africa is booming. I feel it every time I land in Nairobi, Accra and Lagos. Hotels are filled to the brim and the energy on the streets and boardrooms is tangible. The rest of the world is at long last starting to take note.

But the true potential of millions of Africans is still being stunted by the lack of access to reliable and affordable energy. More than 640 million people, two-thirds of the continent’s population, do not have access to electricity. The African Development Bank estimates that Africa’s power outages sap up to four per cent of its GDP growth from its economy every year.

This is crippling the continent’s economies and destabilising societies. Energy poverty has become a matter of national security. Europe must step up efforts to help Africa eradicate energy poverty before it irreversibly affects the ability of nations to fight poverty and save lives.

On average, global cities are growing by around two per cent a year. African cities are growing much faster – at approx eight per cent – as more of the continent’s population move to cities. Despite the challenges it creates, rapid urbanisation does not need to impede Africa’s progress. It can often translate into improved living standards and development levels. But in order for this to happen, Africa’s poor must have access to economic opportunity and stability – something that the continent’s leaders can deliver only if they ensure access to reliable energy supplies. As African countries attempt to eradicate extreme poverty, including energy poverty, demand for affordable energy will be critical. The provision of energy and the infrastructure used to transport supplies is key to African national security and stability.

Access to clean and fairly priced energy will improve lives in Africa. People will be able to work longer, women will be able to walk home at night under the safety of working streetlights and hospitals will be able to provide better care to patients. On the other side of the development spectrum, affordable and reliable energy supply will be crucial to emerging tech hubs such as Nairobi and Kigali. Without it, leaders will not be able to support the aspirations of young, talented Africans.

Some African governments – Kenya in particular – have embraced policies aimed at bolstering future energy security. Looking ahead, Africa’s leaders must implement ambitious programmes that tap in to energy infrastructure investments, both foreign and domestic. They should do more to increase energy supply and access to electricity. There is an African proverb that says: “If you want to go fast, you go alone; if you want to go far, you go together.” In this spirit, Europe and the United States must also do their bit to fuel African growth. Above all, we can help the continent plug gaps in the energy infrastructure network.

 

Championing Indigenous Participation in Oil and Gas Industry

 

 

The woes of indigenous companies in Nigeria’s oil and gas industry seems not to have abated despite the signing of NOGIC Act on April 22, 2010.
Until the appointment of Dr Maikanti Baruas the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), the industry operated merely like a cult where access to information and leadership was like an elephant making effort to pass through the hole in a needle.

Since assumption of office, Baru has worked to eliminate agonies of the government, legislators, workers and contractors in the oil and gas industry. Hence, no more stories of fuel scarcity, long queues at filling stations disappeared and sanctity instituted in the project award process. The exclusion of indigenous companies from project awards and lack of direction for hydrocarbon exploration to build reserves have also become a forgotten issue.

Today, things are looking up for both the government and other stakeholders. The corporation from a position of loss in financial result has also begun to record significant profit in its operation.

Baru has unflinchingly continued to work for increased participation of indigenous companies in oil and gas and this is demonstrated whenever the opportunity arises.
At the commissioning of the Lagos Midstream Jetty (LMJ) at the Apapa Harbour in Lagos last year, Baru had pledged support for indigenous companies’ participation in the sector.

Earlier in the year, the NNPC had listed 32 indigenous players as part of the 50 companies selected to lift Nigeria’s crude for the export market for a two-year period (2018 – 2020), an improvement on the 18 Nigerian companies approved for the contract between 2017 and 2018.
This was an action which demonstrated in practical terms, NNPC’s commitment under Baru’s leadership to support indigenous companies.

In a statement signed by NNPC Group General Manager, Crude Oil Marketing Division, Mele Kyari, the Nigerian companies involved are Aipec, Masters Energy, MRS, Barbedos, Bono Energy, North West, Oando, Casiva, Cretus, Amazon Energy, Sahara Group, Ocean Bed, Eterna, AMG, Arkleen, Gladius Commodities, Leighton, Levene, Hinstock, AA Rano, Propetrol, Emadeb, Setana, Prudent and Setraco. The others are Shoreline, Ultimate Gas, Voyage, West African Gas, Zitts and Lords and Duke Oil, a subsidiary of NNPC.

All contracts are for 30,000 barrels per day except for Duke Oil Limited. The contract is expected to run from July 2018 to June 2020.
The increased participation of indigenous companies in the latest crude oil contracts is a practical proof that the Baru-led NNPC is committed to drive indigenous participation in the oil and gas sector, which will help keep a significant percentage of oil and gas spend in the country which in turn will translate to a significant boost in the economy.

This singular gesture is expected to trigger a lot of developmental strides in the country.
As indigenous players will build more capacity, a lot more oil and gas facilities will also be built, more opportunities will spring up giving birth to more businesses and several jobs created.
With more Nigerian manpower and facilities contributing to the sector, the Gross Domestic Product (GDP) will witness a significant upward surge.

Baru has on numerous occasions consistently voiced his support for building capacity of indigenous players to make them key players in the sector. While receiving members of the Independent Petroleum Producers Group (IPPG) at the tail end of 2017, he once again reiterated his support for collaborating with indigenous producers in order to grow their capacity and participation in the exploration and production sub sector while also urging them to tender bids for the marginal fields.
Speaking at an occasion to mark the Egina Manifold Sail Away celebration in Port Harcourt, the NNPC Group Managing Director disclosed that the Corporation will speed up local capacity development within the nation’s oil and gas industry.

Furthermore, Baru noted that NNPC would always support initiatives aimed at domesticating the ample opportunities in the oil and gas industry.
Baru recognises the need to allow local contractors carry out range of services like fabrication among others in the industry to boost the contribution of the sector to the economy.

He has at various times also pushed for university-industry partnership to grow local content initiatives.
Recently, at the convocation lecture of the Abubakar Tafawa Balewa University (ABTU), Baru called for a workable and symbiotic partnership between the industry and the nation’s educational institutions with the aim of breeding high skilled manpower, incubation of technology thereby enhancing the Nigerian Content initiative.

NNPC together with International Oil Companies (IOCs) have been able to work out a formula to secure oil pipelines and reasonably curb pipeline vandalism. This was achieved largely by engaging mechanism where members of the oil bearing communities are engaged to secure the oil facilities within their domain. This move has engaged the youths in the oil producing communities productively, and in the process empowered them to make income lawfully, curb environmental degradation arising from oil spillage and also ensure there is no downtime or loss of revenue by oil companies, a win-win situation for all parties.

In the downstream retail sector, NNPC’s retail outlets have continued to increase with a network of over 400 stations spread across the country which has helped create several jobs.

Upstream, the NNPC under the leadership of Baru has also embarked on oil search in the inland basins in a move to increase the nation’s oil reserves.
He said with renewed desire of the federal government to increase the nation’s reserve base and production, NNPC’s Frontier Exploration Services (FES) Division was reinvigorated to champion the exploration activities in the inland basins.

The oil search if successful will generate huge investments, improve local technical and financial capacity while also creating a lot of jobs for the citizenry. Conscious of the supply and demand gap for domestic gas supply, Baru’s administration recently signed agreements for seven Critical Gas Development Projects (7CGDP) to deliver about 3.4 billion standard cubic feet of gas per day (bscfd) to bridge the foreseen medium term supply gap by 2020 on an accelerated basis.

In promoting merit and identifying with excellence in performance, Baru at the just concluded NOG conference in Abuja identified with a few of the indigenous companies that have made a success of the opportunities presented by NNPC’s domestic capacity development initiatives.

He took a few moments during his walk through the Exhibition hall to identify with and commend the effort and strides of Amazon Energy, an indigenous firm that he knew from its humble beginnings, but that now provided Engineering, Procurement and Construction Services for major projects in the industry, stating that Amazon Energy was an example and a model of NNPC’s objective in its unrelenting quest to ensure the continuous development of local capacity in the Nigerian oil and gas sector.

Contrary to the fear of International Oil Companies (IOCs) about the technical capabilities of indigenous firms, the appointment of Baru by President Muhammadu Buhari has proved a point that the development and growth of technology in a country is only possible with the collaboration of indigenous stakeholders in the public and private sectors of the economy.

In order to secure support for several projects put in place by Dr Baru to drive in-country development and growth in the sector by indigenous firms, chief executive officers of indigenous firms must help to establish the trust that will encourage the federal government to support NNPC.

This trust will be identified by critics and stakeholders in terms of project completion according to deadline target, quality, transparency, accountability and least cost.
The benefits associated with the recent milestones under Baru will also be sustained if indigenous companies continue to invest in capacity building regardless of oil price volatility in preparation for future opportunities being driven by the NNPC under Baru and his team.

As FG, Discos Trade Blames Over Poor Electricity Supply

neither of the federal government nor electricity distribution companies (Discos) in Nigeria’s power sector can win in the new fight over who’s to blame for the poor showings of the country’s electricity industry…

 

 

 

 

Pundits who have keenly observed the way Nigeria’s power sector had functioned in the last three years or thereabout, weren’t startled by the recent crossfire between the federal government through the Minister of Power, Works and Housing, Mr. Babatunde Fashola, and the power distribution companies (Discos).

They, as a matter of fact suggested  that the exchanges came later than they had expected, noting that both parties had built up palpable tensions in the sector over the last couple of months on decisions and actions they had taken.

The relationship between the government and the Discos have not really being a healthy one as the parties involved have consistently suspected each other.
And as the months rolled by, feelings that a disagreement was in the horizon became profound and the first to fire the salvo but in a discreet manner was Fashola, who told the Discos at a meeting in Kaduna, that the rains were now upon the country and they should become a lot more efficient in their operations.

Fashola, equally made comments about the proposed legislation on estimated billing by Hon. Femi Gbajabiamila, a member of the Federal House of Representatives, stating that the practice had become a source of controversy in the sector and that government would work to end it.

“On the legislative side of government, there is a clear intention to intervene by legislation. The executive and legislative response show that government is committed to addressing this issue of meters. It would take some doing but we are committed.

“Let me be clear that every Disco is affected, no Disco is exempted, we all have meter under-supply and therefore every Disco needs to respond by providing meters quickly and seeking to end estimated billing, which is subjective, discretionary, and often times prone to abuse, and that is why it causes disaffection between the Discos and consumers,” he said.

Though the Discos did not react publicly to this, they quietly expressed their views, which was that the government appeared bent on hanging the unsavoury aspects of estimated billing on their shoulders.
They viewed this in bad taste, and inferred the government was yet to accept both parties were together in efforts to bring stable electricity to Nigerians.

Open confrontation
Almost a month after the Kaduna meeting, Fashola, addressed a press conference, where he specifically asked the Nigerian Electricity Regulatory Commission (NERC) to improve its regulation of the sector and bring the Discos to account for efficient service delivery.
Suggesting the Discos have failed to live up to expectations in the industry, the government said it would not sit back and allow them hold Nigeria hostage with their alleged poor performances.

Fashola, thus asked them to buckle up or get out and leave the business of power distribution for people who were willing to compete and uphold their obligations in the sector.
He wanted NERC to begin to enforce the contracts of service of the Discos with regards to supply of meters, upgrade of their distribution networks and promotion of market efficiency.

He, in summary, substantially blamed the Discos for the failings of the sectors, and even went as far as insisting the government didn’t grant exclusive rights to them over their distribution areas, and in which case, the NERC could further split their networks, especially in areas still underserved by the Discos.

“It must be obvious to the ordinary person that the supply of power is now a private business in the hands of private operators and in the final end, in the hands of the Discos.
“But because of the critical and sensitive nature of power supply, government has not left the supply solely,” said Fashola.

He however stated: “It is the Discos who are service providers that you should turn to when you have questions about transformer collapse and metering,” adding, “As it is now obvious, from 2016 when the Discos complained about lack of power to distribute, the problem today is that the Discos cannot distribute all of the power that is available, leaving the sector with an unused capacity of 2000 megawatts approximately.”

“In the face of this picture, where we have power to sell, with more to come, the number of complaints coming to government for meters, which the Discos should supply, and for estimated billings, and mass disconnections when not everybody is owing cannot continue.
“Government must act and will do so. The Discos bought these assets with their eyes opened, and they must compete to deliver or exit,” Fashola insisted.

The Discos Fired Back
Not wanting to concede to the blames leveled against them by Fashola, the Discos through their association – the Association of Nigerian Electricity Distributors (ANED) – firmly reacted to him and claimed he was quite economical with some of his claims, notably the level of power generation.

They promptly indicated the government was fighting a battle none of the parties would be comfortable with and allegation that the government was misrepresenting facts.
The Discos even linked the new disagreement to the upcoming 2019 elections, claiming they were been demonised for political mileages.

“It is with much regret that we feel compelled to respond to the significantly distorted picture that has been painted of the Disco by the Honourable Minister of Power, Works and Housing in his press briefing of Monday, July 9th, 2018.
“In good faith and with recognition that the challenges of the Nigerian Electricity Industry (NESI) cannot be turned around based on a culture of misrepresentation, we have declined to rebut previous inaccurate assertions by the minister and other government functionaries.

“In this instance, it is clear that the objective of that briefing was to demonise the Discos, who by the structure of NESI, are the faces of a difficult sector. We are also left wondering whether such demonisation of the Discos is camouflage for the absence of the effective policy leadership that is desired for implementing the enabling environment that is necessary for the viability and sustainability of NESI?,” they said through ANED’s Director of Research and Documentation, Mr. Sunday Oduntan.

Oduntan further stated, “We recognise that we are on the crux of a political season, in which all manner of advantage is being sought by political contenders, we however do not want to be used as the whipping dog to advance other people’s agenda.”
According to him, “Our members, the Discos, are not politicians, even though they distribute a product that is of great importance to politicians, in view of the needs of their constituents.

“Our constituency which consists of customers, employees, bankers, vendors and investors have a greater interest in improved service delivery than the adoption of cheap theatrics and propaganda for political advantage.

“We take our service delivery obligations to our customers seriously, with total commitment to improving the quality of the electricity distribution experience to them, as well as meeting the performance obligations of the agreement that we have with the Bureau for Public Enterprises (BPE). “This is more so as the commercial success of our investments is intrinsically tied to the quality of our service delivery.”

Oduntan denied the entire allegations heaped on the Discos by the minister, noting that the government at the privatisation exercise acknowledged the sector was moribund and famous for its inefficiencies, and needed to have a tariff structure that covers the cost of all stakeholders along the value chain, but has so far failed to live by this.
This, he added has also contributed to the failure of the market to move into its planned contract-based regime. He inferred the problems of the sector were self-inflicted and could be solved with honest commitments from all stakeholders.

“Unfortunately, the evolution into TEM (Transition Electricity Market) was truncated by politically-induced regulatory restrictions and actions – (removal of collection losses, freezing of the tariff for R-2 residential class for 18 months, non-payment of N100 billion subsidy for 2013 and 2014, under-recovery of required revenue, non-implementation of minor and major tariff reviews, all manner of politically induced regulatory orders.) – that have resulted in the inability of the Discos to recover the cost of the energy that they supply, preventing their ability to enter into contracts to directly purchase energy from Gencos,” he explained.

Oduntan, equally stated that the current 4.1 million meter gap in the sector was as a result of the government’s failure to invest in metering in over 62 years of running the sector, adding that no other party can be as interested in universal metering of consumers than the Discos because according to him, “metering alone reduces collection losses very significantly and improves customers willingness to pay.”

Regarding power generation profile which Fashola said has improved overtime, Oduntan said in disagreement, “We do not understand the constant references to the increase of generation capacity to 7,000MW, from 4,000MW, for the period of 2015 to 2018 that has been used as the basis of defining the Discos as incapable of taking on more power.
“A review of NERC’s “Daily Energy Watch” for January 28th, 2015 would indicate a generation availability of 6,421MW – divided into peak of 4,230MW and constrained energy of 2,191 MW. In other words, it is misleading to state that available generation has grown from 4,000MW in 2015, as a measure of progress, given that a volume of generation slightly under 7,000 MW already or previously existed, prior to the beginning of this administration.”
He said the government could not claim to have an idle 2000MW capacity when gas supply to generation plants have not been consistent.

As regards the government financial support for the sector, Oduntan, explained that the Discos only got N58.45 billion or 27.75 per cent of the N213 billion the Central Bank of Nigeria (CBN) previously provided for the country’s energy sector, adding that it should not be misread that it got so much and yet doing very little.

Experts’ Opinion
Considering the anxiety the development has thrown up, experts who volunteered their opinions has chose to anonymity.

They, however explained that the development was not in the interest of the country’s power sector.
For instance, they stated that the government appeared to have become exceedingly political with the operations of the sector, adding that the regulatory jobs of the NERC had largely been taken away from it, or at best, orders handed down to it to implement.

Some of them even suggested the government had been largely responsible for the failings of the sector and cited the time it took to constitute the sector’s regulator after the term of its former commissioners expired in December 2015, as well as its alleged refusal to allow the regulator some independence in dealing with the Discos.
According to them, that Fashola and the Discos now exchange words over service delivery, meant that the NERC was either failing in its regulatory tasks or has been relegated and not taking up its jobs.

“You’ll see a veiled politicisation of the issues, and that is very unfortunate because the sector does not need that now or anytime. This is a sector that has not attracted any form of new investments since it was privatised and I think that should worry the government and operators more.

“We should not get to the point of scaring investors. We should not give the impression that this is a difficult sector to invest in because it is not if the government allowed the regulator to do its job. How often do we hear the ministry of finance quarrel with the banks? It never does because it has no business with them when there is a CBN to do all the regulatory and supervisory works,” said an expert who spoke unanimously.

The expert further stated that while the Discos are also guilty of poor performance at some of their tasks, they however have valid claims against the government as regards its interference with the workings of the sector, notably tariff. He said, the NERC and not the power ministry was enough to deal decisively and with regulatory measures with the Discos and their failures.

“Eventually, the consumers will be losers in this because the government has not shown enough capacity to run the sector if it for instance wants the Discos back.
“Go look in on the Yola Discos and how it has fared so far to understand the situation, and you can also ask the government it has been able to refund the former owners of Yola their negotiated remuneration since they exited,” added the expert.

National Carrier for Pariah Nation

…“Corruption is horrible…but something is worse than that and that is incompetence”…

 

                                               Prof Chinedu Nebo

 

We are yet to see any airplane for the proposed National Carrier but millions of dollars have already been expended for just setting ‘side kicks’ including the mere design of logo that does not fit. So as Nebo said both corruption and incompetence are being fostered on Nigerians in order to boost a weak ego of owning a National Carrier that could end up creating more pariah status for Nigeria.

Until you travel wide, you would not know the degree of pariah that Nigeria is subjected to. So, why should Nigeria bother itself with what will expose it more to pariah state. For now more image laundering is required to pull Nigeria out of the pit of pariah outlook and it is by countering the image by allowing those who can be trusted by other nationals to be travelling wide with other airlines till great deal of confidence is restored on the people of Nigeria.

I have heard Archbishop Kukah lament once how he was treated in east Africa not minding his cassock; and somehow such constant visits have allowed Rwanda to build some trust in Nigerians after discovering that they are not all as painted. National Carrier with an infrastructure base that call for drastic upgrading is also part of the distrusting process of a nation. What is more as just recounted by the Minister of Finance money is smart and can only go where the rate of return is assured hence, even the expected foreign investors, without assurance of returns or good infrastructure cannot come with clean hands; they will come to exploit Nigeria more by any means. Nigeria exited Paris club debt on irreconcilable bills; either they were bills not known by the government or bill illegally incurred in the name of Nigeria; that is also the aspect that make money smart. Nigerian elite just want to contract any one to come and exploit the Nations as long as their pocket could be filled with the proceeds.

Most of the elite parade double nationality and could find safe haven in their second country if Nigeria sinks. Those who cannot keep two passports are strictly checked at any entry point as if they are the condemned of the earth. So, if a carrier is identified as a Nigerian Carrier then the checks could be enormous.

I had followed sometimes Khadafy’ national flight well subsidized to get to Tripoli and knows what Nigerians go through on arrival and that Carrier is extinct today as Khadafy is gone also. The point is that the promoter matters to the external world. The Maroc Carrier is still available and it is struggling to meet up notwithstanding the good image the King parades. I have also been part of following it and know the kind of aircraft made available to convey Nigerians to Casablanca. Again, it is a proof that Nigerians are not cherished except for the quantum of their trade value.

In May I was in Dubai on return journey to Nigeria after a conference and Nigerian passengers were made to hang around or stand till their boarding announcement and I wondered if it is not the same standard observed for passengers as even a small town in Afghanistan had its passengers well seated close to the Nigerian desk and it smacked of discrimination. It is only Ethiopia that had shown so far no discriminatory service as I get always lodged in five star hotel when transiting for some hours.

A carrier must be proud of its home facilities, and caring to the passengers; and I am doubtful of such in Nigeria. An experience meted out to passengers last year as they were travelling out of Nigeria’s airport was revisited on Nigeria bound passengers the day I boarded that south Africa’s carrier back to Nigeria. No light and people were asked to go and photocopy the front page of their passport at enormous cost. The craft itself was not air-conditioned as the plea was be patient till we are ready to tee-off.

Quite surprising to me as it was the first time I was hearing that and according to them it was to save energy as they had to make use of the energy on the tarmac as against the one of the craft. It is necessary for Nigeria to see how benchmarkable Ethiopia could be for the carrier and Nigerian egoistic passengers before thinking of a Nigerian Carrier. Even as that carrier had found friendly tarmac in Lome to avoid complete contact with Nigeria, it still remains a favorite of the Togolese. Can Nigeria boast of such rapport? Lome airport is cute and palatable for passengers to feel comfortable in, and it observes relatively bestpractice rules.

When an airport is not comfortable for travelers, they could find ways to avoid the carrier owner and its fleets. That is why people join fleets that can boast of good image of their owners in terms of the nation associated with it. The truth is that a leveraged infrastructure commands respect and it could also translate to profitability seen in marginal costing outlook not necessarily average costing; that is for accountants to ponder. In effect the infrastructure could attract other profit making ventures that can contribute to reduce cost of the usage of the Carrier or the facilities on travelling passengers. For example I have visited Maiduguri airport that is of international standard but unfortunately the usage is horribly local as mamaput sells there. Well, that was 2009 and the abandonment was glaring.

National carrier for Nigeria is an ego not matched by ingredients that could make for a sustainable superego. Some Nigerians you meet in flights display some sort of arrogance that make you feel depressed. And based on such attitude air hostesses report back on their experience for further discriminatory process of passengers of Nigerian make-up. Imagine boarding once Virgin Nigeria and being disembarked far from the terminus and being conveyed by bus in a journey that is about one hour and also discovering that the desk of such airline as marked Nigeria looks like a cage for processing goats. That was in 2012 or 2013. In effect such experiences could not encourage flying any craft on Nigeria’s name unless it is highly subsidized like Kaddafi’s own. Even if so subsidized what about the safety; just as the mentioned Khadafy own started suffering insecurity before its extinction.

Good Nigerians should prevail on Government to upgrade Nigeria’s airport facilities before ever thinking of floating a National carrier. It could be dangerous to further expose Nigerians to more pariah state with a National carrier that could be a great debt burden on the Nation as fictitious debts could be tied on it and Paris club could come again with irreconcilable debt profile of Nigeria.

Victor C. ARIOLE, Ph.D
Professor of French and Francophone Studies
University of Lagos

Post-privatisation Blues Inevitable in Power Sector, BPE Insists

 

              Director General of Bureau of Public Enterprises (BPE), Mr. Alex Okoh

The Bureau of Public Enterprises (BPE) has said the current challenges in Nigeria’s electricity sector were consistent with a market that had been privatised. It assured the sector will eventually pull out of the situation to become productive.

The Director General of BPE, Alex Okoh, said this at a meeting with the House of Representative Committee on Privatisation and Commercialisation in Abuja.

A statement from BPE’s spokesperson, Amina Tukur Othman, explained that the meeting had in attendance representatives of power generation companies (Gencos) as well as distribution companies (Discos) in the country, as well as the Nigerian Bulk Electricity Trading Plc. (NBET).

According to the statement, Okoh, equally stated that the Power Sector Recovery Programme (PSRP) which the federal government initiated with the World Bank, was robust enough to ensure viability of the power sector.

He explained the PSRP would also manage the liquidity issues militating against the sector.

Okoh, however noted that optimising the potential of the PSRP would be largely reliant on a simultaneous effort from all parties involved in the privatisation process as well as regulatory bodies like the Nigerian Electricity Regulatory Commission (NERC).

Speaking further, during the meeting which centered on proffering solutions to the challenges affecting the performance of the Gencos and Discos, Okoh noted that the Nigerian power privatisation transaction was the biggest of its kind in the entire continent, saying post transaction challenges were inevitable.