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Lagos Gas Explosions raise Safety Concerns

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  • Lagos Gas Explosions raise Safety Concerns

Following the gas explosions in Lagos this week, the issue of safety in the Liquefied Petroleum Gas subsector is taking centre stage, with industry stakeholders expressing concerns over the existing safety gaps as the drive to boost cooking gas consumption gains momentum.

On Monday, two people died after a gas leakage triggered an explosion in a cooking gas plant owned by Second Coming Limited on CMD Road, Ikosi-Isheri. It was reported that while officials of the Lagos State Fire Service were assisting to fix the gas leakage in the plant, the exhaust pipe of a speeding vehicle triggered an explosion.

Also on that day, five residents were killed after an oxygen gas transload went awry in a retail shop in Agara, Badagry.

In August last year, four persons were killed and many injured at Obosi in Idemili North Local Government Area of Anambra State following a cooking gas explosion at Trinity Gas Limited station.

The Executive Secretary, Nigerian Association of Liquefied Petroleum Gas Marketers, Mr. Bassey Essien, stressed the need for safety consciousness in the LPG sector.

“We have to be safety conscious and put all the safety parameters in place, and especially with the nature of the product, we need to be very safety conscious and create the awareness among the customers. We cannot play down on safety,” he said.

“There are a lot of gaps in the LPG sector and most of the gaps exist because of the low level of Nigeria’s socioeconomic development,” the National Chairman, Liquefied Petroleum Gas Retailers Branch of the Nigeria Union of Petroleum and Natural Gas Workers, Mr. Michael Umudu, said.

According to him, there is a large number of substandard and imported second-hand equipment and accessories in the system.

He said, “Most, if not all, LPG materials and equipment are sourced outside the country and owing to the depreciating value of naira, many importers prefer countries that compromise universally acceptable standards. Most of the LPG plant storage facilities are brought into the country after they have been used in Europe, North America and other parts of the world.”

Umudu said the leadership of their branch union had often raised the alarm that special attention should be given to accessories, equipment and materials used for the LPG because of the volatile nature of the product.

He said the proliferation of cooking gas retail outlets in the country had made it difficult for effective supervision and enforcement.

“It also leads to the involvement of people who are not qualified to do the business. This is the greatest challenge facing our branch union in the recent times. People who know little to nothing about the LPG retailing business are daily flocking into the business. It leads to the proliferation of substandard and fake products,” he added.

According to Umudu, the LPGAR’s key programme this year is to fight this menace because they dent the association’s image and endanger the lives of customers and neighbours.

He said, “We are already having meetings with the relevant agencies in order to sanitise the system. We are determined to ensure that henceforth anybody entering into the business meets the DPR requirements. We have also mandated those who have been in the retail business but don’t meet the requirement that they should upgrade or face severe sanctions.”

Meanwhile, the Director, Department of Petroleum Resources, Mr. Mordecai Ladan, during an inspection of the Second Coming gas plant in Lagos on Wednesday, said the DPR had commenced an inquest into the Monday fire incident.

Describing the incident as “very devastating,” he said, “The inquest will determine the cause of the incident and what next to do.”

He added, “There was no structure here when the plant was given licence for operation in 1996. We are saying this to let the people know that the facility had been located here before the residents started building their houses. The whole place was bushy when they started operation; it wasn’t like this before.”

He said most times, gas plant fire incidents were as a result of poor management attitude or lack of corrective measures.

Ladan said, “The department always holds a quarterly interactive forum with the association of cooking gas plants’ owners to warn them of fire incident especially during harmattan period.”

At the 2017 Annual General Meeting of the DPR’s Lagos zonal office in November, the Controller, Lagos Zonal Operations, Mr. Wole Akinyosoye, highlighted the growth in the downstream gas market, with more gas plants, gas skids and gas retail outlets.

He said the depot LPG storage capacity in Lagos increased from 6,000 metric tonnes in 2014 to 30,000MT in 2017, with more capacity expansion underway.

He, however, noted that the exponential activities in the LPG market had come with growing challenges, especially on safety.

Akinyosoye said, “Illegal gas plants and skids are mushrooming and more people are rushing into the gas business without taking time to familiarise themselves with the modus operandi on skills and statutory requirements for entry and operations. This has led to increasing fire incidents and near-misses in recent times.”

Citing a recent explosion (early last year) in a gas skid in Ogun State that led to the loss of six lives, he said subsequent inquest by the DPR revealed that it was an avoidable accident.

Akinyosoye said, “We also found out that the lives could have been saved had the minimum safety procedures been followed and the DPR involved in the events leading to the operations in the facility, as prescribed by law. Recently, another gas explosion had occurred somewhere in sub-urban Lagos, where three people were wounded and one very critically.”

He said the DPR had been shutting illegal gas facilities with the support of the security agencies, especially the National Security and Civil Defence Corps.

“Illegal operators should prepare for more shutdown and stricter measures in the coming year, as only the DPR-licensed operators would be allowed in the oil and gas sector to engender safe operations,” he added.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Economy

Electricity Consumers Get 611,231 Meters Under MAP Scheme

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Electricity Consumers Get 611,231 Meters Under MAP Scheme

A total of 611,231 meters have been deployed as at January 31, 2021 under the Meter Asset Provider initiative since its full operation despite the COVID-19 pandemic and other extraneous factors, the Nigerian Electricity Regulatory Commission has said.

NERC disclosed this in a consultation paper on the review of the MAP Regulations.

The proposed review of the MAP scheme is coming nearly four months after the Federal Government launched a new initiative called National Mass Metering Programme aimed at distributing six million meters to consumers free of charge.

“The existence of a huge metering gap and the need to ensure successful implementation of the MYTO 2020 Service-Based Tariff resulted in the approval of the NMMP, a policy of the Federal Government anchored on the provision of long-term low interest financing to the Discos,” NERC said.

The commission had in March 2018 approved the MAP Regulations with the aim of fast-tracking the closure of the metering gap in the sector through the engagement of third-party investors (called meter asset providers) for the financing, procurement, supply, installation and maintenance of meters.

It set a target of providing meters to all customers within three years, and directed the Discos and the approved MAPs to commence the rollout of meters not later than May 1, 2019.

But in February 2020, NERC said several constraints, including changes in fiscal policy and the limited availability of long-term funding, had led to limited success in meter rollout.

NERC, in the consultation paper, highlighted three proposed options for metering implementation going forward.

The first option is to allow the implementation of both the NMMP and MAP metering frameworks to run concurrently; the second is to continue with the current MAP framework with meters procured under the NMMP supplied only through MAPs (by being off-takers from the local manufacturers/assemblers).

The third option is to wind down the MAP framework and allow the Discos to procure meters directly from local manufacturers/assemblers (or as procured by the World Bank), and enter into new contracts for the installation and maintenance of such meters.

“Customers who choose not to wait to receive meters based on the deployment schedule of the NMMP shall continue to have the option of making upfront payments for meters which will be installed within a maximum period of 10 working days,” NERC said.

The regulator said such customers would be refunded by the Discos through energy credits, adding that there would be no option for meter acquisition through the payment of a monthly meter service charge.

“Where meters have already been deployed under the meter service charge option, Discos shall make one-off repayment to affected customers and associated MAPs. Such meters shall be recognised in the rate base of the Discos,” it added.

NERC urged stakeholders to provide comments, objections, and representations on the proposed amendments within 21 days of the publication of the consultation paper.

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Nigeria’s Economy Moving in Right Direction but Slow – Amina Mohammed

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Nigeria’s Economy Moving in Right Direction but Slow – Amina Mohammed

Nigeria is moving in the right direction economically but its movement is not fast, the United Nations stated on Thursday.

Deputy Secretary-General of the United Nations, Amina Mohammed, said this during a meeting at the headquarters of the Federal Ministry of Industry, Trade and Investment in Abuja.

She said the challenges in Nigeria were huge, its population large but described the country’s economy as great with lots of opportunities.

The UN scribe stated that after traveling by train and through various roads in the Northern parts of Nigeria, she discovered that the roads were motorable, although there were ongoing repairs on some of them.

Mohammed said, “This is a country that is diverse in nature, ethnicity, religious backgrounds and opportunities. But these are its strengths, not weaknesses.

“And I think the narrative for Nigeria has to change to one that is very much the reality.”

Speaking on her trips across parts of Nigeria, she said, “What I saw along the way is really a country that is growing, that is moving in the right direction economically. Is it fast enough? No. Is it in the right direction? Yes it is.

“And the challenges still remain with security, our social cohesion and social contract between government and the people. But I know that people are working on these issues.”

She said the UN recognised the reforms in Nigeria and other nations, adding that the common global agenda was the Sustainable Development Goals.

Mohammad commended Nigeria’s quick response to the COVID-19 pandemic, as she expressed hope that the arrival of vaccines would be the beginning of the end of COVID-19.

On his part, the Minister of Industry, Trade and Investment, Adeniyi Adebayo, told his guest that the Federal Government was working hard to make Nigeria the entrepreneurial hub of Africa.

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N10.7tn Spent on Fuel Subsidy in 10 Years – MOMAN

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N10.7tn Spent on Fuel Subsidy in 10 Years – MOMAN

Nigeria spent a total of N10.7tn on fuel subsidy in the last 10 years, the Chairman, Major Oil Marketers Association of Nigeria, Mr Adetunji Oyebanji, has said.

Oyebanji, who was the guest speaker at the 18th Aret Adams Lecture on Thursday, said N750bn was spent on subsidy in 2019.

He highlighted the need for a transition to a market-driven environment through policy-backed legislative and commercial frameworks, enabling the sustainability of the downstream petroleum sector.

“Total deregulation is more than just the removal of price subsidies; it is aimed at improving business operations, increasing the investments in the oil and gas sector value chain, resulting in the growth in the nation’s downstream petroleum sector as a whole,” he said.

The managing director of 11 Plc (formerly Mobil Oil Nigeria Plc) said steps had been taken, “but larger and faster leaps are now required.”

According to him, deregulation requires the creation of a competitive market environment, and will guarantee the supply of products at commercial and market prices.

“It requires unrestricted and profitable investments in infrastructure, earning reasonable returns to investors. It requires a strong regulator to enable transparency and fair competition among players, and not to regulate prices,” Oyebanji said.

He noted that MOMAN had recently called for a national debate by stakeholders to share pragmatic and realistic initiatives to ease the impact of the subsidy removal on society – especially on the most vulnerable.

He said, “A shift from crude oil production to crude oil full value realisation through deliberate investment in domestic refining and refined products distribution, creates the opportunity to transform the dynamics of the downstream sector from one of ‘net importer’ to one of ‘net exporter’, spurring the growth of the Nigerian economy.

“Effective reforms and regulations are key drivers for the growth within the refining sector. Non-functional refineries cost Nigeria over $13bn in 2019. If the NNPC refineries were operating at optimal capacity, Nigeria would have imported only 40 per cent of what it consumed in 2019.”

Full deregulation of the downstream sector remains the most glaring boost to potential investors in this space, according to Oyebanji.

He said, “As crude oil prices will fluctuate depending on the prevailing exchange rates, it will be astute to trade in naira to avoid inevitable price swings.

“There needs to be a balance between ensuring the sustainable growth of the crude oil value chain (upstream through downstream) and providing value for the Nigerian consumer and the Nigerian economy.”

He said the philosophy should be for the government to put the legislative and commercial framework in place and let the market develop by itself.

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