Pan Ocean’s Amukpe Pipeline to Boost Nigeria’s Crude Exports by 160,000bpd
Davidson Iriekpen and Ejiofor Alike with agency report
Pan Ocean’s Amukpe-Escravos Pipeline Project (AEPP) in Delta State, which is scheduled to come on stream before the end of the third quarter of 2017, will boost Nigeria’s crude oil exports by 160,000 barrels per day and also serve as an alternative to the much troubled Trans Forcados Pipeline (TFP) for oil companies operating in the western Niger Delta, the company has said.
The Senior Pipeline Engineer and Project Lead of AEPP, Mr. John Okusolubo, said in a statement Wednesday that the objective of the pipeline project was to provide Pan Ocean Joint Venture and other producers such as Seplat Petroleum Development Company Plc, Nigerian Petroleum Development Company (NPDC), Conoil, Sahara, and others an alternative export pipeline route to the existing TFP that had been a casualty of militant attacks.
Okusolubo said: “The primary objective of AEPP is to ensure that there is no disruption to crude oil export like the scenario we experienced on the TFP over the past 16 months where there was a total collapse of crude export.
“Nigeria’s experience and history have shown that it is not wise to be highly dependent on a particular source that is why we have AEPP as an alternative to TFP which has been our major means of exporting crude oil as a joint venture (JV) partner.”
According to him, the construction of the AEPP entails the use of continuous Horizontal Directional Drilling (HDD) method to install the entire pipeline length for the purpose of security from the act of vandalism, which is prevalent in the area.
He stated that the AEPP is going to be a major export line that will give the opportunity for other injectors who may also be stalled by the erratic vandalism of the TFP to join in the transport of crude to Escravos.
“This great achievement means Pan Ocean has an alternative line to export its crude and has also created an opportunity for others who have been using TFP to also export their crude without disruption. This project will help the country to continue to flow their crude and keep the economy alive,” he added.
Attacks on oil and gas facilities by the Niger Delta militants have severely impacted exploration, production, and export of crude oil from the region.
Oil companies operating in the region have either cut back on their production or in some cases stopped production over attacks on their facilities.
The Trans Forcados Pipeline has a daily capacity of 240,000 bpd, with average daily flows ranging between 200,000 bpd and 240,000 bpd.
Amid its shutdown, Nigeria’s crude oil production fell from 2 million bpd to as low as 1.27 million bpd, losing its position as Africa’s number one crude oil producer and falling behind Angola several times over the past year.
Pan Ocean, operator of the NNPC-Pan Ocean Joint Venture had responded to this threat, by awarding a contract for the construction of Amukpe-Escravos Pipelines Project (AEPP) to Fenog Nigeria Limited, an indigenous company in 2011.
The contract, which involved installation of 20-inch pipelines across the 67 kilometres route, will have the capacity to handle 160,000 barrels of oil per day (BOPD) with remote manifolds to accommodate third parties’ crude oil evacuation to the Escravos Tank farm.
FG Agencies Agree on Oil Revenue Management
Meanwhile, key agencies of the federal government have agreed to partner in oil revenue savings and promotion of better attitude to public office.
They are Nigeria Extractive Industries Transparency Initiative (NEITI), Nigeria Sovereign Investment Authority (NSIA) and National Orientation Agency (NOA).
A statement by NEITI’s Director of Communications, Dr. Orji Ogbonnaya Orji, Wednesday said in Abuja that the agencies reached the agreement at separate meetings with NEITI Executive Secretary, Mr. Waziri Adio.
According to Adio, the meetings are focused on exploring areas of inter-agency mutual cooperation.
He explained that while NSIA managed the Sovereign Wealth Fund (SWF) derived from extractive revenues, NOA led the national campaign for attitudinal change and ethical values in the country.
At the meeting with the management of NSIA, the NEITI executive secretary expressed regrets that “the nation’s paltry oil savings defeated the rationale for having such savings in the first place”.
“Nigeria does not have enough oil savings to finance even the fifth of a year’s budget at the federal level, not to talk of having enough for investments or for the future generation,” he lamented.
Adio said the occasional paper recently released by NEITI, largely focused on the “Case for a Robust Oil Saving Fund for Nigeria”.
He added that in the publication, NEITI drew public attention to the fact that Nigeria failed to save enough oil revenues when oil prices were quite high in order to sustain economic activities.
“From the paper also problematic is the level of consumption relative to non-oil exports. Nigeria typically responds to high oil prices with equally high but manifestly unsustainable level of consumption.
“The absence of sufficient savings left Nigeria severely exposed when the price of oil, Nigeria’s main source of government revenues and foreign exchange, started to plunge in 2014,” Adio said.
He said the researched publication largely touched on the work of NSIA and the managers of Nigeria Sovereign Wealth Fund.
He explained that NEITI’s decision to alert the nation on the need to save for the rainy day was informed by the need for the country to prepare adequately for frequent price volatility, “depletion of non-renewable resources and for future generation”.
Earlier, the Managing Director of NSIA, Dr. Uche Orji, commended NEITI for taking the initiative to produce the paper, adding that it helped NSIA to tell its own story in an independent manner.
According to him, “NEITI has a voice that resonates with policy makers and its other stakeholders. We found the publication exceptional and commendable.”
The NSIA boss said the report was produced without the inputs of his agency.
He described the recommendations in the publication as very succinct and apt.
“We are here to ask for closer collaboration between the NSIA and NEITI in the discharge of our individual mandates while working together for the common good of our country,’’ he added.
The NSIA managing director briefed the NEITI management on what his agency had achieved so far, the prospects of on-going projects and unfolding challenges.
He further explained that the NSIA established frameworks for good corporate governance, risk management, transparency, and accountability, adding that the solid governance structure had attracted credible partners, notable investors, and private equity funds.
He disclosed that the Nigeria Governors’ Forum (NGE), which initially opposed its mandate, is one of its greatest supporters at the moment.
“The $250 million we invested in 2016 came from the state governments’ share of the NLNG dividend,” Orji hinted.
Meanwhile, NEITI and NOA are to establish an effective platform for collaboration, especially in information sharing, public education, and enlightenment.
The Director-General, Dr. Garba Abari, announced this when NEITI’s executive secretary visited his office.
Abari announced that 813 offices of NOA would be made available to NEITI as a platform for dissemination of the organisation’s reports to all nooks and crannies of Nigeria.