Nigeria will soon be using coal as an alternative source of energy, the Minister of Solid Minerals and Mining, Dr. Kayode Fayemi, has said.
Fayemi, who spoke when the Executive Director of a Non-Governmental Organization, CSR-in-Action, Bekeme Masade, led a team of civil society organisations on a visit to him, said the Ministry of Power, Woks and Housing, has set itself the policy on energy needs and it has proposed that coal will contribute 30 per cent into the energy needs.
He said: “We have dedicated that coal licenses will only be awarded to those who want to generate electricity and we are collaborating with the FMPWH on this,” adding that the process is on.
“There are certain processes you need to fulfil. You need to have a licence for power generation before you acquire a licence for mining. Since the inception of this administration, no licence for coal has been awarded which is not for the purposes of power generation.
“So if you acquire a licence for mining coal, you have to also have that for power. Once the application is filed and it is not encumbered by any legal, or existing holder of a licence, the licence is awarded, but it must be for power generation only. Quite a number of companies have applied directly either to us or to the FMPWH,” he stated.
On Ajaokuta, Fayemi said the Federal Government has not conceded control of Ajaokuta Steel Company to either Chinese or Indian firms, saying there is no official engagement with anybody on ASC. He described as misleading, reports in some quarters to the effect that the steel company has been handed over to a Chinese firm.
Fayemi, who was represented by his Technical Adviser, Egghead Odewale, said the original concession agreement that was signed between Nigeria, Global Steel Holding Limited and Global Infrastructure Nigeria Limited, “has been re-modified.
“The original concession agreement that was signed between the Federal Government of Nigeria, Global Steel Holding Limited and Global Infrastructure Nigeria Limited has been re-modified. It has been modified to decouple Ajaokuta Steel Company Limited from Nigeria Iron Ore Mining Company in Itakpe.
“What that also portends is that Global Infrastructure Nigeria Limited now has seven years of their original concession to complete the mining operation to operate Neo-coal in Itakpe whereas Ajaokuta has reverted to the government of Nigeria. So it is now been held by the Federal Government of Nigeria, “ he stated.
Speaking on those he called “artisanal miners” and those who work under the radars”, the minister said the menace was part of the development challenges in the country.
He expressed concern over the menace of illegal miners in the country estimated to number about 15 million.
He said: “Our approach is not a law and order approach to be able to regularise the operations of these illegal miners who work under the radar. Our approach is to incentivise them to formalise their processes, and to be able to get them to contribute to public revenue and for the benefit of their own operation so that they will be able to benefit from the mining operations that we undertake day-in-day-out because we are marking a process to undertake an extension service for artisanal miners.
“I won’t say we have credible data on their number, but there are estimates that put their population to be up to between 10-15 million.
Oil Prices Hit Multi-year Highs on Monday
Oil prices hit multi-year highs on Monday buoyed by recovering demand and high natural gas and coal prices encouraging users to switch to fuel oil and diesel for power generation.
Brent crude oil futures were up 59 cents, or 0.7%, to $85.45 a barrel by 0900 GMT, after hitting $86.04, their highest level since October 2018.
U.S. West Texas Intermediate (WTI) crude futures climbed 90 cents, or 1.1%, to $83.18 a barrel, after hitting a $83.73, their highest since October 2014.
Both contracts rose by at least 3% last week.
“Easing restrictions around the world are likely to help the recovery in fuel consumption,” analysts at ANZ bank said in a note, adding that gas-to-oil switching for power generation alone could boost demand by as much as 450,000 barrels per day in the fourth quarter.
Cold temperatures in the northern hemisphere are also expected to worsen an oil supply deficit, said Edward Moya, senior analyst at OANDA.
“The oil market deficit seems poised to get worse as the energy crunch will intensify as the weather in the north has already started to get colder,” he said.
“As coal, electricity, and natural gas shortages lead to additional demand for crude, it appears that won’t be accompanied by significantly extra barrels from OPEC+ or the U.S.,” he said.
Prime Minister Fumio Kishida said on Monday that Japan would urge oil producers to increase output and take steps to cushion the impact of surging energy costs on industry.
Chinese data showed third-quarter economic growth fell to its lowest level in a year hurt by power shortages, supply bottlenecks and sporadic COVID-19 outbreaks.
China’s daily crude processing rate in September also fell its lowest level since May 2020 as a feedstock shortage and environmental inspections crippled operations at refineries, while independent refiners faced tightening crude import quotas.
Oil and Gas Companies in Nigeria
Nigeria is an oil reach nation with several oil and gas companies operating in Africa’s largest economy. However, only ten oil and gas companies are listed on the Nigerian Exchange Limited (NGX).
Before we discuss in detail each of the listed oil and gas companies in Nigeria. A short background on Africa’s largest economy will help throw more light on the significance of the oil and gas companies or the entire oil sector to the Nigerian economy.
Nigeria is a petrol-dollar economy, which means Africa’s most populous nation, sells crude oil and use its proceed to service the economy. In fact, the Nigerian Naira is backed by crude oil like Canadian Dollar and other commodity-dependent economies.
But because the Central Bank of Nigeria (CBN) pegged the Naira against its global counterparts, the local currency does not reflect succinctly the fluctuation in global oil prices like other crude oil-dependent currencies.
Since global oil prices rebounded with the gradual reopening of economies, the oil and gas companies in Nigeria have also rebounded from the 2020 record low of $15 per barrel. The oil and gas sector has gained 62.76 percent from the year to date, according to the NGX Oil and Gas Index.
The index gauge price movements in 10 listed oil and gas companies in Nigeria. However, there are several oil and gas companies in Nigeria not listed on the Nigerian Exchange Limited.
Oil and Gas Companies Listed on the Nigerian Exchange Limited (NGX)
|Company||Ticker||Sector||Date Listed||Date Incorporated|
|ARDOVA PLC [CG+]||ARDOVA||OIL AND GAS||–||November 12, 1964|
|CAPITAL OIL PLC [MRF]||CAPOIL||OIL AND GAS||–||August 29, 1985|
|CONOIL PLC||CONOIL||OIL AND GAS||–||June 30, 1970|
|ETERNA PLC.||ETERNA||OIL AND GAS||–||January 13, 1989|
|JAPAUL GOLD & VENTURES PLC||JAPAULGOLD||OIL AND GAS||August 10, 2005||June 29, 1994|
|MRS OIL NIGERIA PLC.||MRS||OIL AND GAS||–||August 12, 1969|
|OANDO PLC [MRF]||OANDO||OIL AND GAS||February 24, 1992||August 25, 1969|
|RAK UNITY PET. COMP. PLC. [MRF]||RAKUNITY||OIL AND GAS||–||December 20, 1982|
|SEPLAT ENERGY PLC [CG+]||SEPLAT||OIL AND GAS||–||June 17, 2009|
|TOTALENERGIES MARKETING NIGERIA PLC||TOTAL||OIL AND GAS||–||January 6, 1956|
Oil Prices Extend Gains on Friday After Saudis Dismiss Supply Concerns
Oil prices extended gains on Friday after Prince Abdulaziz bin Salman, Saudi Energy Minister dismissed calls for more crude oil supply on Thursday.
Brent crude oil, against which Nigerian oil is priced, rose to $84.92 per barrel at around 8:31 am Nigerian time. The U.S West Texas Intermediate crude oil also responded positively to the comment, rising to $81.56 per barrel on Friday.
“What we see in the oil market today is an incremental (price) increase of 29%, vis-à-vis 500% increases in (natural) gas prices, 300% increases in coal prices, 200% increases in NGLs (natural gas liquids) ….”
He further stated that the Organization of the Petroleum Exporting Countries and allies led by Russia, have done a “remarkable” job acting as “so-called regulator of the oil market,” he said.
“Gas markets, coal markets, other sources of energy need a regulator. This situation is telling us that people need to copy and paste what OPEC+ has done and what it has achieved.”
Prince Abdulaziz explained that OPEC plus will add 400,000 barrels per day in November and do the same in December and subsequent months. The increase will be gradual he said.
“We want to make sure that we reduce those excess capacities that we have developed as a result of COVID,” he said, adding that OPEC+ wanted to do it “in a gradual, phased-in approach”.
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