- LPG Consumption Grew by 600% in Two Years – FG
The consumption of Liquefied Petroleum Gas, popularly known as cooking gas, in Nigeria, increased by 600 per cent in the past two years, the Federal Government announced on Thursday.
It was also gathered that the $12m LPG plant being established in Ikuru Town in Rivers State by Green Energy International Limited, operator of Otakikpo Marginal field in OML 11, would be ready for installation by the second quarter of 2019
In his address in Abuja, the Minister of State for Petroleum Resources, Ibe Kachikwu, said that the Nigerian Gas Policy had helped in growing country’s output in gas production.
Kachikwu said, “The Nigerian Gas Policy is a very comprehensive document that sets out the parameters for growth for gas, how we meet our local needs, what sort of infrastructure is required and the various segments of business opportunities that exist.
“It was passed by the Federal Executive Council and it has been driving the gas sector. We are hoping that relying on that policy we will be able to drive investments into the fertiliser, petrochemicals, methanol and LPG areas.
“LPG is one area where we have done some very good work. We’ve seen a 600 per cent increase in LPG growth over the last two years. Consumption is about 420,000 metric tonnes, which is about 600 per cent increase and that’s a very major movement.”
On the 12 million standard cubic feet per day LPG plant, the Chairman, Green Energy, Prof. Anthony Adegbulugbe, said the approval to construct the facility was issued by the Department of Petroleum Resources in August this year, a sequel to the successful submission of the engineering design.
Adegbulugbe, according to a statement issued in Abuja, said that the plant was being constructed in China at a cost of about $12m, adding that the project would ensure zero gas flare in the Niger Delta, under its small-scale gas utilisation programme.
He noted that host communities in the area would get uninterrupted power supply through the company’s gas-to-power project, as six megawatts gas-fired power generators were already on site for installation.
Adegbulugbe said that the company had secured a 15MW power generation licence from the National Electricity Regulatory Commission and efforts were being made to increase it to 40MW.
Outlining other plans of the company in its phase two development programme, Adegbulugbe said Green Energy had completed a 3D seismic campaign to understand the field with a view to drilling more wells in the area, while an onshore export terminal was being proposed for establishment in 2020.
He said that the company started production in 2017 and currently produced 6,000 barrels of crude oil per day, adding that it planned to ramp up production to 20,000bpd in the next few years.
He further noted that Green Energy and its technical partner, Lekoil, had patronised local community contractors since its inception with over N3bn worth of procurement contracts which had contributed to the economic development of the people.
Crude Oil Drops on Wednesday as U.S. Oil Inventories Jump Unexpectedly
Global oil prices fell by 1 percent on Wednesday after data from the U.S. Energy Department showed that the United States oil inventories unexpectedly rose by 4.3 million barrels last week. More than the 1.9 million barrels predicted by experts.
The unexpected increase in United States inventories weighed on crude oil prices on Wednesday, erasing $1.31 or 1.5 percent from Brent crude oil after it rose to a seven-year high on Tuesday. While the U.S West Texas Intermediate (WTI) dipped by $1.09 or 1.3 percent to $83.56 a barrel.
Still, gasoline stocks declined by 2 million barrels across the United States, a situation likely to push pump prices even higher.
“The market continues to deplete Cushing crude oil inventories and that is impacting the Brent-WTI spread and ultimately we’re going to see crude oil diverted from the Permian up to Cushing rather than going to the Gulf Coast,” said Andrew Lipow, president of Lipow Oil Associates in Houston.
However, the shaky COVID-19 recovery in most economies has led to doubts over the sustainability of rising oil prices.
“(Some) countries are falling into an autumn Covid-19 case spike,” said Louise Dickson, senior oil markets analyst at Rystad Energy, “which poses downside risk for oil demand growth in the very near-term and could provide a soft pressure on oil prices.”
Brent Crude Oil Extends Gain to $86.66 a Barrel Amid Tight Supply
Tight global oil supply pushed Brent crude oil, against which Nigeria oil is priced, to a multi-year high of $86.66 per barrel on Monday at 3:30 pm Nigerian time.
Oil price was lifted by rising fuel demand in the United States and tight global supply as economies recover from pandemic-induced slumps.
“The global energy supply crunch continues to show its teeth, as oil prices extend their upward march this week, a result of traders pricing in the ongoing rise in fuel demand – which amid limited supply response is depleting global stockpiles,” said Louise Dickson, senior oil markets analyst at Rystad Energy.
Goldman Sachs on the other hand is predicting a further increase in Brent crude oil to $90 a barrel, citing a strong rebound in global oil demand due to switching from gas to oil. This the bank estimated may contribute about 1 million barrels per day to global oil demand.
The investment bank said it expects oil demand to reach around 100 million barrels per day as consumption in Asia increases after the devastating effect of COVID-19.
“While not our base-case, such persistence would pose upside risk to our $90/bbl year-end Brent price forecast,” Goldman said in a research note dated Oct. 24.
Earlier this month, the Organization of the Petroleum Exporting Countries, Russia and their allies, known as OPEC+ agreed to continue increasing oil supply by 400,000 bpd a month until April 2022 despite calls for an increase in global oil supplies.
The decision bolstered the price of Brent crude oil above $84 per barrel and expected to push the price even further to $90 a barrel. Low global oil supply amid rising demand for crude oil will continue to support oil prices in the near term.
“Despite the recent power cuts and impacts to industrial activity in China, oil demand is likely instead supported by switching to diesel powered generators and diesel engines in LNG trucks, as well as by a ramp up in coal production,” Goldman Sachs stated.
U.S. and Ghana Inaugurate New $64.7 Million Energy Infrastructure Investment at Pokuase
U.S. Ambassador to Ghana Stephanie Sullivan joined the President of Ghana H.E. Nana Akufo-Addo and other Ghana government officials to formally inaugurate the Pokuase Bulk Supply Point (BSP) in Accra today. The U.S. Millennium Challenge Corporation (MCC) funded the $64.7 million (GH₵ 391.9 million) electrical infrastructure project under the Ghana Power Compact.
“The Pokuase Bulk Supply Point represents sustainable infrastructure investment by the United States with Ghana that will benefit hundreds of thousands of Ghanaians now and into the future,” remarked Ambassador Sullivan at the inaugural event. “It will help deliver more reliable power to the people, places, and businesses of Accra that drive increased economic activity benefitting families, businesses, and communities.”
This represents a flagship investment under the Millennium Challenge Corporation’s Ghana Power Compact. The Pokuase BSP will reduce outages in the power system, help stabilize voltages, and improve the quality and reliability of power supplied to the northern parts of the capital city of Accra. It will also reduce technical losses in the power transmission and distribution system, contributing to the financial viability of the Electricity Company of Ghana (ECG) and the Ghana Grid Company (GRIDCo) in the long term. The Pokuase BSP is now the largest-capacity BSP in Ghana at 580 megavolt amperes (MVA) and will directly benefit 350,000 utility customers.
The Government of Ghana implemented the project through the Millennium Development Authority (MiDA). MiDA formally handed over the new power substation to ECG and GRIDCo in today’s ceremony.
The Pokuase BSP is the first major construction project to be completed under the Ghana Power Compact. The $316 million compact is helping the Government of Ghana improve the power sector through investments that will provide more reliable and affordable electricity to Ghana’s businesses and households. The compact is also funding a BSP at Kasoa and two primary substations at Kanda and Legon, in addition to other power sector investments, energy efficiency programs, and women’s empowerment programs within the power sector. The compact program will officially close on June 6, 2022.
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