Shell shuts Nigeria’s Nembe Creek Trunk oil pipeline due to theft

Royal Dutch Shell said on Wednesday that it had closed Nigeria’s Nembe Creek Trunk oil pipeline on Saturday to stop leakage caused by theft.

The pipeline pumps the Bonny Light grade of crude oil. Bonny Light exports for April are at about 95,000 barrels per day according to shipping lists compared to 155,000 for March.

Absence of EFCC witnesses stalls Alao, others’ trial

The trial of an oil marketer, Abdullahi Alao and four others, charged with N1.1 billion fuel subsidy fraud, was stalled yesterday in Lagos following the absence of prosecution witnesses at an Ikeja High Court.

Abdullahi, son of a prominent businessman, Alhaji Abdullazeez Arisekola-Alao, is being prosecuted by the Economic and Financial Crimes Commission (EFCC).

He was charged alongside two other oil marketers — Olarenwaju Olalusi and Opeyemi Ajuyah, and their companies –Majope Investment Ltd and Axenergy Ltd.
The accused are facing an eight-count charge bordering on conspiracy, obtaining money under false pretences, forgery, uttering and use of false documents.

During yesterday’s proceedings, all the accused and their counsel were in court when the case came up for hearing.
Counsel to the EFCC, Mr. Rotimi Oyedepo, however, informed the court that the witnesses were not in court for the trial to commence.

Oyedepo, who apologised for their absence, asked for a short adjournment to enable the prosecution to produce the witnesses in court to give evidence.
Justice Lateefat Okunnu acceded to Oyedepo’s request and adjourned the case to March 19 for continuation of trial.

Importers move to Ghana, Benin ports as slow processes in Nigeria hurt business

Nigeria stands to lose volumes in maritime-related business and the revenues and jobs that come with it as activity is shifting from the country’s seaports to those of neighbouring Ghana, Togo, Benin and Cameroon on account of long delays in cargo clearance.

Average clearing time for containerised cargo in Nigeria is between 14 and 21 days (two to three weeks), while in Ghana, importers spend two days for the same purpose. Similarly, in Cotonou (Benin) and Togo, importers spend an average of seven days to take delivery of their goods.

Analysts say that slow cargo clearing processes, which result in high demurrage and storage charges, also lead to loss of business to nearby ports where the processes are faster and therefore more cost-effective.

Trader backs NNPC on SWAP deals

Executive Director, Sahara Energy, Wale Ajibade has backed the Nigerian National Petroleum Corporation (NNPC) conduct of the oil SWAP arrangement, saying the deals conformed to international standard.

Ajibade who addressed the House Committee Upstream currently investigating the alleged connivance of NNPC with Swiss Oil Traders to defraud the government, noted that the deals were transparent and complied with all audit requirements.

Ajibade who represented Trafigura Trading Oil Company based in Switzerland explained that there was nothing untoward between his company’s SWAP arrangements with NNPC/PPMC.

According to him “NNPC in its records noted that Nigerian traders collectively account for 98.2million barrels on 2013. The other international traders, including the Swiss Trading Companies lifted 61.2 million barrels while offshore and the Nigerian refineries took 36.2 and 38.3 million barrels respectively.  The NNPC trading companies account for 83.5 million barrels”.

He said in view of the above, there was no remote possibility that NNPC would lose $6.8 billion from sales below market value to “the companies described by the petitioners as Swiss Trading Companies”.

“The SWAP arrangement referred to by the Bern Declaration was in line with the known practices in the oil industry. The NNPC had to dispose unrefined portion of its 445,000 barrels to meet domestic needs of petroleum products.

“It is to be noted that the NNPC delivers the international market value of the crude oil to the federation on the basis of the general sales agreement and conditions.  There is therefore no value loss to the federation. The claims by the Bernes Declaration are baseless and without material substance and should be set aside in its entirety”, he added.

20 auditors working on NNPC’s account, says AGF

The Auditor General for the Federation (AGF), Mr Samuel Ukura on Thursday said that 20 auditors trained in gas and oil auditing were examining the accounts of the NNPC.

Ukura said this when he appeared before the House of Representatives Committee on Public Accounts in Abuja to defend the 2013 and 2014 budgets.

The Senate had called for a forensic auditing of the NNPC’s account to unravel the alleged missing 20 billion dollars.“We had a budget of N60 million for training and we were able to train 20 officers who are presently on the field auditing the accounts of the NNPC,” he said.

The AGF also said that his office mopped up about N100 million unspent funds for the purchase of vehicles for his office.Ukura said the contractors, Innoson Motors, failed to supply the vehicles as at Dec. 31, 2013.

He said that the Bureau of Public Procurement (BPP) had issued his office with a “Letter of No Objection”, directing him to award the said contract for the purchase of vehicles to Innoson Motors.

According to him, since the vehicles were not supplied, no money was paid for them.The Auditor-General said that his office was only able to buy five Toyota Hilux pick-up vans and one Prado jeep.He said this was done at the cost of N49.9 million out of the N180 million initially earmarked for the purchase of vehicles.

On the performance of the 2013 budget, Ukura told the committee that the recurrent budget was implemented 100 per cent while the capital budget was implemented only 57.7 per cent, amounting to N374.157 million.

In a remark, the Chairman of the committee, Rep. Solomon Adeola (APC- Lagos), directed the AGF to submit all payment vouchers and receipts of payments and contracts awarded by his office.He said the AGF should again appear before the committee on Tuesday, March 4 to defend the 2014 budget.The committee also summoned the Director- General of the BPP, Mr Emeka Eze, to appear before it on Tuesday to shed light on the vehicle purchase.

OPEC exports to rise 7 1/2-year high – Oil Movements

The Organization of Petroleum Exporting Countries will boost crude exports to near their highest level since 2006 as refiners replenish stockpiles, Oil Movements said.

OPEC, responsible for 40 percent of global oil supplies, will increase shipments by 430,000 barrels a day, or 1.8 percent, to 24.38 million barrels in the four weeks to March 15, the Halifax, England-based firm said in an e-mailed note. Shipments were estimated to have reached 24.74 million in the same period to March 1. The figures exclude two of OPEC’s 12 members, Angola and Ecuador.

“A high proportion of the additional February barrels are moving east and a lot of it going to China,” Oil Movements founder Roy Mason said by phone. “We’re going into the year short of stockpiles” in developed nations also, after a “severe winter” in the U.S. drained inventories, he said.

China will retake the lead from the U.S. in oil demand growth this year as its manufacturing and transportation industries expand, according to the International Energy Agency. Oil inventories in advanced economies tumbled in the fourth quarter by the most since 1999 because of the “surprising robustness” of demand in the U.S. and other developed nations, the agency said on Feb. 13.

Middle Eastern exports will average 17.91 million barrels a day in the month to March 15, compared with 17.49 million in the period to Feb. 15, Oil Movements said. These figures include non-OPEC nations Oman and Yemen.

Crude on board tankers will rise by 4.5 percent to 499.97 million barrels through March 15, from 478.57 million in the previous period, data from Oil Movements show. The researcher calculates volumes by tallying tanker bookings and excludes crude held on vessels for storage.

OPEC’s members are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. The group will next meet on June 11 at its headquarters in Vienna.