September 25, 2023

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Nigerian National Petroleum Corporation Records $378.42 million Sales in Crude Oil and Gas

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Nigerian National Petroleum Corporation (NNPC) yesterday announced a total crude oil and gas export receipt of $378.42 million in June 2020 as against $133.16 million it posted in May this year.

This development was coming as NNPC, Akwa Ibom State Government and an American private equity investor have secured investment commitments worth more than $10 billion with the potential to create more than 7,000 long-term jobs, in a new oil and gas free zone approved in the state by President Muhammadu Buhari.

NNPC said the oil and gas sale in June signalled a marked improvement in revenue earnings, apparently following the easing of the COVID-19 pandemic global lockdown and the subsequent increased demand and firmer prices for crude oil in the international market.

In a statement issued yesterday by its Group General Manager, Group Public Affairs Division, Dr. Kennie Obateru, NNPC stated that petroleum receipts for the month reflected crude oil earnings of $230.65 million, with gas and miscellaneous proceeds standing at $75.97 million and $71.80 million, respectively.

The statement explained that details of the earnings were contained in the June 2020 Monthly Financial and Operations Report (MFOR) of NNPC, which it noted, is the 59th edition in the series.

The report put the total crude oil and gas export receipts for the period June 2019 to June 2020 at $4.60 billion.

In the downstream sector, NNPC monthly report said in order to ensure continuous supply and effective distribution of petroleum products across the country in June, 2020, 1.34 billion litres of white products were distributed and sold by its downstream subsidiary, the Petroleum Products Marketing Company (PPMC).

It noted that the figure was significantly higher than the 950.67 million litres of white products sold and distributed in May 2020, again an apparent reflection of the gradual ease of the lockdown in the country and the picking up of business activities.

“A breakdown of the June 2020 figures indicated that over 1.3 billion litres of petrol, 5.10 million litres of diesel and 1.65 million litres of kerosene were sold and distributed during the period,” it said.

White products sale for the period June 2019 to June 2020, the report disclosed, stood at over 19.104 billion litres, with petrol accounting for over 18.9 billion litres or 99.36 per cent.

In monetary value terms, it said the above volumes translated to a total sale of N134.22 billion of white products by PPMC in June 2020, compared to N92.58 billion sales in May, 2020.

“Total revenues recorded from the sales of white products for the period June 2019 to June 2020 stood at over N2.267 trillion, where petrol contributed about 99.12 per cent of the total sales with a value of over N2.247 trillion.

“During the month under review, 33 pipeline points were vandalised representing about 11 per cent decrease from the 37 points recorded in May 2020.

“Mosimi-Ibadan accounted for 33 per cent, while Atlas Cove-Mosimi and Warri-River Niger recorded 27 per cent of the breaks each; other locations made up for the remaining 13 per cent,” it added.

NNPC MFOR for June, 2020 explained that in collaboration with the local communities and other stakeholders, the corporation would continuously strive to rein in on the incidences of pipeline breaches across the country.

In the gas sector, the corporation said out of the 232.03 billion Cubic Feet of gas (BCF) supplied in June 2020, 148.66 BCF of gas was commercialised; consisting of 34.64 BCF and 114.01 BCF for the domestic and export market, respectively.

This, the report explained, translated to a total supply of 1,154.78 million Standard Cubic Feet of gas per day (mmscfd) to the domestic market and 3,800.45 mmscfd of gas supplied to the export market for the month.

According to the corporation, it also implied that 64.07 per cent of the average daily gas produced was commercialised, while the balance of 35.93 per cent was re-injected and used as upstream fuel gas or flared.

NNPC report stated that gas flare rate for June 2020 stood at 6.11 per cent, that is, 472.94 mmscfd, compared with average gas flare rate of 7.84 per cent, equivalent of 611.73 mmscfd for the period June 2019 to June 2020.

Buhari Approves New Oil, Gas Free Zone

Meanwhile, NNPC, Akwa Ibom State Government and an American private equity investor, the Black Rhino Group, have secured investment commitments worth more than $10 billion with the potential to create more than 7,000 long-term jobs, in a new oil and gas free zone approved in the state by President Muhammadu Buhari.

According to a statement issued yesterday on the presidential declaration of the area as a free zone, the Minister of Industry Trade and Investment, Chief Adeniyi Adebayo, who is the supervising minister for the free zones, noted that the new free zone, named Liberty Oil and Gas Free Zone, which is the largest in West Africa, sits on a physical land space measuring more than 50,000 hectares spread across six local government areas of Ikot Abasi, Eastern Obolo, Oruk Anam, Mkpat Enin, Onna and Ibeno.

Adebayo, who described the project as a game changer, added that “the Liberty Oil and Gas Free Zone is expected to generate industrial clusters that will deliver impetus to the federal government’s industrial revolution plan by fast-tracking the development of related industries such as lubricant and plastics manufacturing, utilising abundant hydrocarbon feedstocks in the zone.”

The Managing Director of the Oil and Gas Free Zones Authority (OGFZA), Mr Umana Okon Umana, said OGFZA was “excited about the project because of the prospects it holds out for the economic development of the country.”

OGFZA is the statutory regulator of the new free zone.

The statement added that one of the promoters/developers operating out of the Ibeno axis of the free zone, Qua Iboe Export Hub Limited (QIEH), has a significant operation in place already, gearing up as the gas processing hub for West Africa.

A profile of QIEH’s planned investments and projects up to 2023 include a 567MW gas-fired power plant, which is at advanced stages of development; 15 million standard cubic feet gas flare elimination investment valued at $120 million under the federal government gas flare commercialisation programme, by which gas being flared around the area would be gathered and converted to domestic use; a 3.5 million MTPA petrochemicals platform, designed under the nation’s natural gas monetisation programme to produce methanol and ammonia; and a 2.0 million MTPA liquefied natural gas plant, LNG export terminal and LNG fleet network to be developed within the projected period.

Other key projects lined up for execution during the period include a gas field development and pipeline transport system to supply gas from Mobil-NNPC JV operations to meet the energy requirements of QIEH; a high-octane gasoline 20,000 bpd plant for the production of synthetic gasoline; and the development of a logistics base and a fabrication yard to support the operations of oil production and service companies in the zone.

When the entire free zone comes on stream, it would position the country as the destination for future downstream investments in the oil and gas industry, especially in logistics and manufacturing. The development design of the zone at full rollout would feature a Petroleum and Energy District; NNPC Logistics Centre; Business and Industrial District; Agro-allied Industrial District; and Heavy Industry District.

The Liberty Oil and Gas Free Zone inherited some important legacy projects, which include the 115 MW Ibom Power Plant and the Aluminium Smelting Company of Nigeria, both of which are located in Ikot Abasi.

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