Economy
OPEC Challenges Nigeria to Push for Energy Diversification
By Adedapo Adesanya
The Organisation of Petroleum Exporting Countries (OPEC) has revealed that the global energy sector requires about $12.6 trillion investment for development by 2045, charging Nigeria to re-strategise.
This was disclosed by the Secretary-General of the cartel, Mr Mohammad Barkindo, while presenting a keynote address at the 14th Annual Conference of the Nigerian Association of Energy Economics (NAEE) in Abuja, saying that oil would continue to remain relevant to the global economic growth and development.
At the event themed Strategic Responses of the Energy Sector to COVID-19: Impact on African Economies, Mr Barkindo said that oil would continue to remain relevant to global economic growth and development.
“It is vital for us to remember that oil will remain the largest contributor to the energy mix to 2045 with more than 27 per cent, according to the latest OPEC World Oil Outlook.
“Renewables are developing most rapidly, but at the same time, the world’s economy is set to double and all resources will be required to meet this growing need.
“Cumulative investment of $12.6 trillion in the upstream, midstream and downstream is crucial through to 2045 in order to meet this need,” he said.
According to him, investment in 2020 dropped by more than a whopping 30 per cent in the face of COVID-19, even worse than the dramatic declines seen in the severe 2015-2016 industry downturn.
He said that the energy security risk that would result from too little investment would heavily impact both producers and consumers.
He noted that oil-producing developing countries, like Nigeria, would be particularly hard hit.
“History has shown that energy insecurity brings with it economic insecurity and geopolitical instability.
“All OPEC Members, including Nigeria, will have to re-strategise to maintain their positions in the new global energy mix, including focusing on economic diversification.
“Oil-producing countries, and in particular African countries that rely on oil and gas production for revenues, must create an investment-friendly climate — to this end,” he said.
He noted that the Petroleum Industry Bill (PIB) promises to be a huge success in reviving the fortunes of the oil and gas industries in Nigeria.
He said that reduced foreign direct investment into Africa’s industry could be catastrophic for many countries and peoples.
He said that OPEC was concerned about increasing pressure on the oil industry coming from many sides, including decision-makers, along with investors.
“Even within the boardrooms of oil majors, the push is strong to strive for policies and initiatives that could have a drastic negative effect on oil-producing countries.
“Oil is the lifeblood of our country, thus the importance of this issue cannot be underestimated,” he said.
On Energy Transition, Mr Barkindo said oil had a powerful role to play in the energy transition, and it should not be swept under the rug based on old credentials.
He noted that with the help of technology, the industry can become low carbon or even zero-carbon.
“This includes technologies already being implemented such as carbon capture, utilization and storage.
“Additionally, great strides have been made in efficiency gains in the industry, along the entire production chain.
“It is essential that one compare the lifetime credentials of each source of energy in terms of emissions.
“For example, electric cars may appear cleaner, but emissions are buried in many of the industrial processes required to produce them.
“We applaud Nigeria’s goals to reduce carbon emissions while pursuing the UN SDGs, which seek to achieve access to affordable, reliable, sustainable and modern energy for all.
“Transitioning to a low-carbon energy future may seem to run counter to the socio-economic benefits of energy, in particular to energy-poor countries.
“Nigeria is attempting to tackle this challenge head-on with the strong promotion of solar and wind energy, and expansion in the use of natural gas,” he said.
On the impact of COVID-19, the OPEC Secretary-General said that the global oil sector was a worse hit but on the road to recovery.
“We have all suffered the impact of the COVID-19 pandemic over 2020 and 2021. It constitutes an unprecedented event for the global oil industry and the world economy.
“No country or citizen of this planet has remained unscathed and the pandemic continues to overshadow 2021 as it did 2020.
“However, oil-producing developing countries have been particularly hard hit.
“They are facing a triple whammy; COVID-19 has crippled the economies of poorer countries more than wealthier ones,” he said.
He urged the NAEE to use the conference and proffer solutions to some major challenges facing the sector nationally and globally.
By Adedapo Adesanya
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) says the first cargo of the new Obodo crude blend has been shipped.
Business Post gathered that the first cargo could be headed for the North Sea port of Wilhelmshaven, Germany.
In a statement by the chief executive of NUPRC, Mr Gbenga Komolafe, Conoil Producing Limited was congratulated on the successful shipment of the first cargo of the Obodo crude blend.
Mr Komolafe said this development marks a significant milestone for Nigeria’s upstream sector, demonstrating the growing capacity of indigenous operators to contribute meaningfully to national crude oil production and exports.
“The introduction of the Obodo crude blend further diversifies Nigeria’s export portfolio and aligns with the commission’s strategic objectives to enhance production output, maximise hydrocarbon resources, and attract investment through operational efficiency and innovation,” he said.
Mr Komolafe maintained that this achievement by Conoil, under the production sharing contract framework with the Nigerian National Petroleum Company Limited, also reflects the positive outcomes of collaborative regulatory support, enabling indigenous players to thrive.
“As the regulator of Nigeria’s upstream petroleum industry, the NUPRC remains committed to providing a transparent, predictable, and investment-friendly environment that encourages the development of new crude streams and ensures optimal value for the Nigerian people.
“We look forward to more milestones of this nature that advance national energy security and economic resilience,” he said.
According to tracking data from Kpler, the Suezmax Atlanta Spirit loaded on April 25 from the floating production, storage and offloading vessel Tamara Tokoni.
Obodo has a gravity of 27.65°API and a very low sulphur content of 0.05pc, according to Argus.
Obodo joins the list of crude grades launched by Nigeria in the last year.
The Nigerian National Petroleum Company (NNPC) restarted production of similar-quality Utapate in 2024 and launched Nembe a year earlier.
Obodo could find favour with European refineries, as Nigerian medium sweet grades — including Forcados, Escravos and Bonga — have gone predominantly to Europe, the largest market for the country’s crude.
By Adedapo Adesanya
Dangote Oil Refinery has reportedly cancelled planned maintenance on its 204,000 barrels per day petrol-producing unit for June.
This comes as the $20 billion structure has carried out the necessary work during an unplanned shutdown from April 7 to May 11, according to industry tracker, IIR.
Dangote Refinery had originally scheduled a 30-day maintenance shutdown in June for its gasoline-producing Residue Fluid Catalytic Cracking (RFCC) unit.
The refinery has since pushed back on reports of the unit being under unplanned repair, stating that such claims are not entirely accurate.
According to data from shipping analytics firm, Kpler, during the unplanned outage, the refinery ramped up exports of residual products such as straight run fuel oil, while shipments of finished fuels like jet fuel and gasoil declined.
The 650,000 barrels per day refinery, built by Africa’s richest man, Mr Aliko Dangote, began producing diesel, naphtha, and jet fuel in January last year, followed by petrol production in September.
Dangote refinery could potentially end the long-standing gasoline trade from Europe to Africa, which is valued at $17 billion annually.
Already, the refinery has triggered a spate of changes in fuel prices locally with back to back cuts down to N825 per litre earlier this week from N835 previously sold.
The refinery, however, has not been able to operate at its optimal level due to challenges around feedstock. So far, in addition to local crude acquisition, it has bought crude from the US, Brazil, Angola, and Algeria.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange rose further by 1.02 per cent on Tuesday, May 13, buoying the market capitalisation by N19.77 billion to close at N1.967 trillion compared with the preceding day’s N1.947 trillion.
In the same vein, the NASD Unlisted Security Index (NSI) went up by 33.77 points to finish at 3,359.79 points, in contrast to the 3,326.06 points reported a day earlier.
Central Securities Clearing System (CSCS) Plc increased during the trading session by N2.35 to N27.20 per share from N24.85 per share, NASD Plc added N1.90 to close at N20.90 per unit compared with the previous day’s N19.00 per unit, FrieslandCampina Wamco Nigeria Plc gained 87 Kobo to close at N41.30 per share versus the previous closing value of N40.43 per share, Mixta Real Estate Plc climbed higher by 51 Kobo to end at N5.51 per unit compared with Monday’s price of N5.00 per unit, and AG Mortgage Bank Plc appreciated by 5 Kobo to settle at 58 Kobo per share, in contrast to the preceding session’s 53 Kobo per share.
The level of activity was higher yesterday, with the volume of securities transacted going up by 61,474.7 per cent to 414.5 million units from the 673,233 units traded in the previous trading day, the value of trades jumped by 16,714.4 per cent to N1.05 billion from N6.3 million, but the number of deals fell by 28.6 per cent to 25 deals from 35 deals.
Impresit Bakolori Plc remained the most active stock by volume on a year-to-date basis with 536.9 million units worth N524.7 million, followed by Geo-Fluids Plc with 266.3 million units sold for N470.5 million, and Okitipupa Plc with 153.6 million units valued at N4.9 billion.
Okitipupa Plc also remained the most active stock by value on a year-to-date basis with 153.6 million units sold for N4.9 billion, trailed by FrieslandCampina Wamco Nigeria Plc with 20.2 million units valued at N770.6 million, and Impresit Bakolori Plc with 536.9 million units worth N524.7 million.
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