Emmanuel Addeh | This Day
The Nigeria Extractive Industries Transparency Initiative (NEITI) yesterday announced its readiness to release the three reports on the oil, gas, mining and sectors by June.
It stated that the ongoing nationwide audit of the oil, gas and mining industries being conducted by NEITI covering 168 extractive companies and relevant federal agencies are currently at the data reconciliation stage, adding that the exercise covering the period 2021 is held in different parts of the country.
A statement signed by the Deputy Director/Head Communications & Stakeholders Management quoted the Executive Secretary of NEITI Dr Ogbonnaya Orji as explaining that the objectives of the reports were to establish the quantities of minerals produced, utilised in the country and the quantity of crude legally or illegally exported or stolen.
“NEITI reports also seek to establish the revenue paid by oil, gas and mining companies and how much of such revenues were actually received into government coffers.
“Other areas of focus by NEITI are to identify investments made by the federation or the federal government in the oil, gas and mining industries, track subsidy payments, company remittances and liabilities,” it added.
It further explained that the processes followed in various transactions, especially the basis for computation and remittances of all revenues payable to the government such as taxes, royalties and rents are equally of interest to NEITI.
Orji explained that a total of 66 oil and gas companies and 14 government agencies were covered and are currently with working NEITI in the sector audit.
The executive secretary noted that the level of cooperation between companies and government agencies covered by the audit was encouraging.
“From the preliminary reports we have reviewed, 62 companies fully complied with detailed information and data as contained in NEITI templates/checklist while we await full compliance by only four companies,” Orji added.
In the solid minerals sector, Orji noted that 102 companies were undergoing the NEITI Audit. The exercise which has reached an advanced stage, he stressed, has recorded full compliance by 92 while NEITI was following 10 companies very closely.
“NEITI audit in the solid minerals industry is reviewing information and data on revenue streams, distribution of revenues, licensing process including register and allocation of licenses, information on beneficial ownership and the status of the contribution of the solid minerals to the economy.
” Other areas of interest include trend analysis of production volumes data, royalty payments, export destinations of Nigeria’s solid minerals and the sector’s relevance in shaping economic policy,” NEITI added.
On the fiscal allocation and statutory disbursement audit, NEITI said it was examining revenues received from oil, gas and mining producing states and statutory relevant government agencies and the utilisation of such revenues for development projects.
In this particular NEITI audit, Orji stated that nine states and 14 federal agencies were covered.
“The states are Gombe, Nasarawa, Rivers, Delta, Anambra, Bayelsa, Imo, Kano and Ondo state. Out of the nine states, only two are yet to fully provide NEITI with relevant information and data,” the executive secretary said.
NUPRC Signs Seven Regulations to Push for Accurate Crude Metering, Reduce Gas Flaring
Emmanuel Addeh and Peter Uzoho | This Day
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC), yesterday, signed seven key regulations in furtherance of the implementation of the Petroleum Industry Act (PIA) 2021.
That was as the Nigerian National Petroleum Company Limited (NNPC), yesterday, executed five new deals covering the renewal of the Oil Mining Lease (OML) 130 Production Sharing Contract, conversion of the acreage to a Petroleum Mining Lease (PML), and three other deals.
Speaking at an event in Abuja, the Chief Executive of NUPRC, Mr. Gbenga Komolafe, noted that the signing into operation of the seven key regulations in furtherance of the implementation of the PIA was in line with the provisions of the new law and in fulfilment of the mandate of the commission.
One of the new regulations, which had just been operationalised, included the Nigeria Upstream Petroleum Measurement Regulations, 2023, which Komolafe noted would close the metering gap in upstream petroleum operations and encourage accelerated meter rollout in upstream petroleum operations.
Besides, Komolafe stated that the metering regulation would encourage the development of independent and competitive meters used in upstream, attract private investment in the provision of metering services, as well as provide for the regulation of the measurement of petroleum produced.
Komolafe pointed out that the regulation would ensure accurate measurement of petroleum as a basis for the calculation of petroleum revenue accruable to the government and define requirements for the design, fabrication, manufacturing, testing, calibration, operation and maintenance of upstream metering equipment.
For the second regulation, the Production Curtailment and Domestic Crude Oil Supply Obligation Regulation, 2023, the NUPRC chief executive stated that it would provide the general rules for production curtailment and utilisation of the produced petroleum in relation to export and domestic crude oil supply obligation.
The Frontier Basins Exploration Fund Administration Regulations, 2023, Komolafe explained, would provide the general rules for the exercise of the commission’s responsibilities with respect to frontier basins to encourage and attract investment to the basins in Nigeria.
For the Nigeria Upstream Decommissioning and Abandonment Regulations 2023, the NUPRC boss asserted that it seeks to ensure that decommissioning and abandonment activities are conducted in accordance with good international petroleum industry practices.
The regulations, he noted, also set the framework for the establishment and administration of a decommissioning and abandonment fund.
According to Komolafe, the Significant Crude Oil and Gas Discovery Regulations, 2023, would ensure optimum exploitation of petroleum covered by Petroleum Prospecting Licenses (PPLs) granted under the Act, by the retention of areas of significant crude oil and gas discovery by a licensee for a specified time.
In explaining the Gas Flaring, Venting and Methane Emission (Prevention of Waste and Pollution) Regulations, 2023, Komolafe stated that it would reduce the environmental and social impact associated with gas flaring and venting of natural gas and fugitive methane emissions into the atmosphere.
Besides, he explained that it would help preserve and protect the environment, prevent waste of natural resources and enhance energy transition in Nigeria.
Komolafe added that the newly unveiled regulation would create social and economic benefits from gas flaring and venting as well as set out the procedure for the commission to exercise its rights to take gas at flare point.
In addition, he said that the Nigeria Upstream Petroleum Unitisation Regulations, 2023 establishes rules, principles, and procedures for the implementation of unitisation of oil and gas from a petroleum reservoir that extends beyond the boundaries of a licence or lease area into an area to which another licence or lease relates.
Komolafe stated, “These seven regulations being signed today represent a significant milestone achievement for the commission in its continued stride towards the attainment of the goals of the PIA and the reformation of the upstream petroleum sector.
“All the regulations are revolutionary in nature aimed at providing a regulatory environment that assures efficiency, predictability, clarity, and effectiveness to the industry in the discharge of the commission’s mandate.”
He recalled that five regulations that were successfully gazetted between June and October 2022 were the Petroleum Licensing Round Regulations 2022; Petroleum Royalty Regulations 2022; Domestic Gas Delivery Obligations Regulations 2022; Conversion and Renewal (Licences and Lease); and Nigeria Upstream Petroleum Host Communities Development Regulations 2022.
Komolafe reaffirmed that the seven regulations that were signed were part of the 13 draft regulations that were presented for discussion during the first, second, and third phases of the commission’s consultations with stakeholders between 2022 and 2023.
Other regulations are Upstream Petroleum Fees and Rents Regulations; Upstream Decommissioning and Abandonment Regulations; Unitisation Regulations; Acreage Management (Drilling and Production) Regulations; Frontier Exploration Fund Administration Regulations; and Upstream Environmental Remediation Fund Regulations.
They also include the Upstream Petroleum Safety Regulations; Upstream Petroleum Environmental Regulations; Upstream Petroleum Measurement Regulations; Advance Cargo Declaration Regulations; Significant Discovery Regulations; Domestic Crude Oil Supply Obligation Regulations; and Gas Flaring and Venting (Prevention of Waste and Pollution) Regulations.
Furthermore, Komolafe stated that the inputs of the stakeholders from the various engagements were considered in the drafting of the regulations. He noted that they were subsequently forwarded to the Attorney General of the Federation and Minister of Justice for vetting, legislative standardisation and approval.
In his remarks, Executive Secretary of the Nigeria Extractive Industries Transparency Initiative (NEITI), Dr. Ogbonnaya Orji, expressed the readiness of the initiative to collaborate to push the boundaries of transparency and accountability in the oil and gas industry.
He lauded the NUPRC for finding the courage and selflessness to enact some of the regulations, which would further strengthen the regulatory institution.
Orji reiterated that Nigeria lost over 600 million barrels of oil to theft and other sharp practices in the sector over a period of 12 years, amounting to about $46.16 billion or N16.25 trillion.
NNPC Eyes $2.1bn Gas Revenue, Executes 5 Suite of Agreements on OML 130 with Total, CNOOC, Others
Meanwhile, NNPC Limited executed five new deals covering the renewal of the OML 130 Production Sharing Contract, conversion of the acreage to a PML and three other deals.
The new deals were based on the provisions of the Petroleum Industry Act (PIA) 2021, and with the utmost aim of unlocking gas revenues of up to $ 2.1 billion for Nigeria in both short and long terms.
The execution of the deal for renewal, conversion to PML and three other agreements by all the parties took place in Abuja, and was witnessed by Permanent Secretary, Ministry of Petroleum Resources, Mr. Gabriel Aduda.
THISDAY gathered that the deal was part of the gas commercialisation programme being considered by NNPC, which seeks to end the perennial dispute over OML) 130, thereby upscaling the country’s crude oil output to about three million barrels per day and unlock gas revenues to the tune of about $2.1 billion in both short and long terms for the country.
NNPC executed the deals with its partners, including Total Exploration and Production Nigeria (TEPNG), China National Offshore Oil Corporation (CNOOC), South Atlantic Petroleum Nigeria Limited (SAPETRO), and Prime 130 Limited, and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
A statement issued by NNPC after the signing of the deals said the suite included PSC Contract between NNPC Limited and its contractors, China National Offshore Oil Corporation (CNOOC) & South Atlantic Petroleum (SAPETRO) with Total Upstream Nigeria (TUPNI) as the operator; Heads of Agreement (HoA) Amendment between NNPC Limited, TUPNI, SAPETRO, PRIME 130, & CNOOC; a Settlement Repayment Agreement (SRA) Addendum between NNPC and its Contractors (CNOOC & SAPETRO).
Others were Concession Contracts for one Petroleum Prospecting Licence (PPL) and three Petroleum Mining Leases (PML) and Lease & License Instruments between NNPC, TUPNI, SAPETRO, PRIME 130 and NUPRC.
The national oil company further emphasised that the deals paved the way for firming up Final Investment Decision (FID) on the Preowei, amounting to $ 2.1 billion.
It further explained that the Preowei project would subsequently be followed by Egina South projects lined up by TUPNI and the OML 130 partners to introduce additional volumes to the best-in-class Egina Floating, Production, Storage and Offloading (FPSO) Vessel.