On Wednesday 23rd May, Dr. Maikanti Baru, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), disclosed that the NNPC would resume petroleum products retail across markets in the Economic Community of West African States (ECOWAS) in the next two years. Baru stated this during the unveiling of the new logos for four of its downstream subsidiaries: Petroleum Products Marketing Company (PPMC), Nigerian Pipelines and Storage Company (NPSC), NNPC Retail Limited and NNPC Shipping. Baru said the corporation would own 30% market share of the petroleum products distribution business in Nigeria by 2020 from the current 14%, and NNPC Retail Ltd would extend its businesses to other neighbouring states in the West African sub-region. Additionally, Baru disclosed that it was the corporation’s key aspiration to strengthen its shipping outfit to support the downstream growth objectives of its subsidiaries, saying the corporation would not relent until NNPC Shipping becomes the partner of choice in the marine transportation and logistics business.
Dr. Ibe Kachikwu, the Minister of State for Petroleum Resources, mentioned in his presentation at a technical symposium organised by the Society of Petroleum Engineers, that timely approval of Field Development Plan (FDP) is a win-win situation for both the government and investors. Kachikwu described the FDP as one of the fundamental criteria and a roadmap in the development of any asset in the oil and gas sector (especially upstream exploration and production projects) in the country. The FDP is the document that serves as a regulator of the oil and gas industry. The Department of Petroleum Resources (DPR) must approve before the commencement of activities in any oilfield of our nation. The laws of Nigeria prevent licence holders from installing facilities or producing oil and gas without the approval of the Minister of Petroleum Resources or its delegate, the DPR.
Tullow’s flagship Jubilee oilfield production vessel off Ghana’s west coast will shut down for 21 days in the forthcoming week to undergo repairs. The planned shutdown of the Kwame Nkrumah production vessel which currently produces both oil and gas will result in a cut to offshore gas supply. Any loss of power generation would be offset by generating additional power from the eastern port of Tema. Tullow originally identified damage to a turret bearing on the vessel in 2016 and has said it would need to shut down the vessel to fix it. Ghana began oil production in late 2010 and currently produces around 180,000 barrels per day (bpd) mainly from three main fields. Jubilee, which produces about 100,000 barrels per day (bpd), also produces most of Ghana’s gas for power generation. Tullow controls over a third of the Jubilee field, whose other investors include Kosmos Energy, Anadarko, Ghana National Petroleum Corporation and Petro SA.
On Thursday 24th May, oil prices continued to drop amid concern global supply and future output from the Organization of Petroleum Exporting Countries (OPEC). The US West Texas Intermediate crude futures shed 28 cents at $71.56 a barrel at 3:55 AM ET (07:55 GMT), while Brent crude futures fell by 36 cents at $79.43 a barrel. The U.S Energy Information Administration weekly report for Wednesday 23rd May showed a rise in crude oil inventories by 5.778 million barrels in the week ending May 18, confounding expectations for a draw of 1.567 million barrels. Domestic oil production driven by shale extraction remained unchanged at an all-time high of 10.70 million bpd. Only Russia currently produces more, at around 11 million bpd. OPEC members could step up production as soon as June due to worries over supply from both Venezuela and Iran. Production in Venezuela plunged to 1.5 million barrels in April, its lowest level in decades due to its ongoing economic crisis. U.S. sanctions against Iran, which currently produces 4% of global oil supplies, will also likely cause shortages later in 2018 when trade restrictions take effect. Libya, an OPEC member, cut its oil production by about 120,000 bpd due to an unusually hot weather prompted power problems. OPEC and some non-OPEC major oil producers are scheduled to meet in Vienna on June 22 to decide to increase oil output to make up for the reduced supply.