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Nembe Oil Spill: FG Halts Aiteo From Operating Oilfield in Bayelsa

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Following the damages done by AITEO leaking oil pipe to the people of Nembe community in Bayelsa state, the Federal Government has halted all operations in the affected area until a proper investigation had been conducted.

The Ministry of Environment disclosed this in a statement signed by Mr. Saghir el Mohammed, Press Director, Ministry of Environment, on Tuesday in Abuja.

Mohammed stated that the federal government had taken a proactive measure to assess the damages done by Aiteo oil spillage to the people of Nembe Local Government Area of Bayelsa State and ensure safety of lives and properties.

The statement reads, “The Federal Government has directed the exploration company, AITEO Eastern Exploration and Production Company Limited (AEEPCo), to halt operations in the area until a proper investigation is carried out.

“Also, adequate measures will as well put in place to ensure the safety of lives and property in the area.
“It can be recalled that the spill occurred on Nov. 5, 2021, in a form of a fountain within the proximity of Opu Nembe Community at Well 1, Well Head located at the Southern Field of Sant Barbara.

“Upon receipt of the report of the incident, a Joint Investigation Team (JIT) comprising the National Oil Spill Detection and Response Agency (NOSDRA), Nigerian Upstream Petroleum Regulatory Commission (NUPRC), was set up.

“Also, the state Ministry of Environment, Community representatives and Aiteo Eastern Exploration and Production Company was set up on Nov. 6, 2021 to immediately address the situation.

“The exercise was inclusive because of inaccessibility to the wellhead location due to the hydrocarbon fumes that saturated the atmosphere in the area.

“Consequently, the JIT directed AEEPCo to shut down in the impacted asset (well head) for appropriate oil spilI response.

Accordingly, AEEPCo deployed booms and skimmers to contain the spill crude oil from spreading.

“As at Nov. 10, 2021, efforts to shut the well has proven difficult due to inaccessibility.

“Meanwhile, in an effort to safeguard the environment and livelihood, staff from the NOSDRA’s Yenagoa Field Office were deployed to the site to monitor and give a progress reports on the measures being taken to address the issue.

“There is further directives to AEEPCo to engage all relevant stakeholders in the spilled oil recovery process.

“In this vein, 3,000 barrels of emulsified crude oil have been recovered and held in a recovery barge.

“Also, additional booms were deployed by the Clean Nigeria Association (CNA) System to work with the on-site recovery contractor.

“Further effort yielded result as containment and recovery within the leak area have been reinforced by Nov. 15,” he said.

Mohammed said that the CNA has mobilised to site for enhanced containment and recovery.

He added that boot and coots, mobilised for well control and securing and AEEPCo has secured temporary work permit for expatriates expected in the country for the activity.

According to him, based on JIT reports, a well control company (Kenyon International) was at the incident location for an on-site assessment.

“Meanwhile, containment and recovery are still on-going. It is instructive to note that the wellhead experts have arrived Nigeria and will commence work on killing the well.

“However, in order to ensure safety and guarantee future operations in the area by AEEPCo, NOSDRA has mandated the company to carry out concrete actions.

“The action is to address the situation that includes clean-up of impacted areas, remediation of spill site as well as damage assessment and post-spill impact assessment.

“NOSDRA, through the Federal Ministry of Environment, will keep the public informed on future developments on the spill incident with an effort to contain further spread and limit the effect on the environment.

 

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.

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Crude Oil

New COVID Variant: Brent Crude Sheds Over $10 to $72 Per Barrel

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Brent crude oil extended decline by over $10 on Friday on concerns that a new COVID variant called B.1.1.529 could force economies to impose restrictions and slow down global demand.

Brent crude, against which Nigerian crude oil is measured, dropped from $82.55 per barrel it attained on Thursday to as low as $72.09 on Friday at 7:20 pm Nigerian time before it rebounded slightly to $72.98 per barrel as shown below.

Global financial markets plunged across the board following reports that two cases of the new heavily mutated COVID variant from South Africa have been reported in Hong Kong and that the United Kingdom, one of the most affected nations during COVID-19 with over 140,000 deaths has halted flights from six South African nations to prevent a potential breakout of the new COVID variant.

Experts are concerned that the new variant outbreak would slow down global growth and increase global risks going into the new year.

According to Craig Erlam, Senior Market Analyst, UK & EMEA, OANDA, “Even without severe restrictions, people will adopt more caution which will weigh on demand, as OPEC+ has repeatedly stated and factored into their models.”

However, heavy crude oil-consuming nations like the United States, China and others that have been calling for more supply will now enjoy substantial price reduction if this continues, therefore, Joe Biden may not need to release millions of barrels into the global market.

“Crude is back at levels last seen at the start of October and if this risk aversion continues in the weeks ahead, there’s plenty of room to fall. While OPEC+ would likely have avoided altering production plans next week or in the months following in response to the SPR releases, it may soon feel its hand is being forced. Next week may come too soon but another major outbreak could see them slam on the brakes,” Craig Erlam added.

 

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Concerns Over New COVID Variant Plunges Brent Crude Oil Below $80 a Barrel

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Concerns over rising new COVID variant in South Africa, Asia and other regions weighed on Brent crude oil and other financial assets on Friday.

The heavily mutated COVID variant called B.1.1.529 plunged Brent crude oil, against which Nigerian crude oil is priced, by almost 4 percent on Friday to trade below $80 a barrel for the first in months.

Brent crude dropped $3.16 or 3.8 percent to $79.06 per barrel while the US West Texas Intermediate (WTI) sheds $3.45 or 4.4 percent to $74.94 a barrel.

“Oil prices have gapped lower in Asia as the South African variant sparks’ growth fears, sending a wave of selling through Asian energy markets. Although gas and coal prices are holding steady, oil prices have tumbled,” stated Jeffrey Halley, Senior Market Analyst, Asia Pacific, OANDA.

Commodity prices dropped after the United Kingdom announced it has halted all flights from six South African nations. In Hong Kong, two cases of the new variant were detected on Friday.

“With US markets closed for holidays, investors are voting with their feet this morning. The one bull in the China shop that could truly derail the global recovery has always been a new strain of Covid-19 that swept the world and caused the reimposition of mass social retractions.”

This was coming two days after U.S President Joe Biden announced his administration plans to release millions of barrels of oil from strategic reserves to cool rising crude oil prices and rein in fuel price in the world’s largest economy.

Global financial markets experts are worried that the new variant will slow down global growth and force economies to start shutting down following the U.K announcement on Thursday.

Today, investors across the world will be paying attention to the outcome of meeting between WHO and South African officials, and the evolution of the B.1.1.529 variant. This will dictate market reaction for next week.

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NEMBE SPILL: AITEO Mobilizes To Clean Up SBAR SPILL, Collaborates With Renowned ‘BOOTS & COOTS, CNA

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• CEO, Benny Peters Assures Affected Communities of Speed, Ecosystem Protection.

Two weeks after a non-producing wellhead in the NembeLocal Government Area of Bayelsa State leaked and is still spewing its contents, the operators of the NNPC/Aiteo Joint Venture of Oil Mining Lease (OML) 29, Aiteo Eastern Exploration and Production Co. (AEEPCo), have announced several proactive measures to combat and contain the spill.

The wellhead, located in the Santa Barbara Southwest field in Nembe LGA, was, according to AITEO, predominantly dormant. The leak started on November 5. According to Ndiana Mathew, spokesperson for AITEO, said that upon noticing the leak, “Aiteo notified all relevant regulatory agencies and, thereafter, mobilised containment resources to limit the impact on the environment. As required, Aiteo promptly called for a Joint Inspection Visit (JIV). Due to the high-pressure effusion, the JIV team could not reach the location and that inspection was aborted.”

“Since then, Aiteo has activated an elaborate and extensive spillage containment response in the internationally prescribed manner. Though spills of this nature are not uncommon to the oil and gas industry, their resolution requires expert skill and equipment that is not routinely or readily available. The typical process is to first kill the well and stop the leak and then focus on the clean-up.”

Mathew said further that aside from the urgent possible technical responses to contain the leak, Aiteo has sought, become involved with and is now in active collaboration with Clean Nigeria Associates (CNA) which has since mobilised to site in addition to Aiteo internal resources to reinforce containment and recovery efforts. CNA is the oil and gas industry non-profit umbrella body with expertise and resources to contain spills of this nature. Because it was causing growing anxiety among the local communities that rely on the surrounding land and waterways, the area has been cordoned off and the CNA is mobilising additional resources to strengthen the containment effort.

It was gathered that a well-killing assessment site visit has been carried out to evaluate the assets and earmark the resources required to bring the effusion under control. The required apparatus including heavy-duty and specialist equipment are presently being mobilized, locally and internationally, on a fast-track basis, to bring the well under control. For this purpose, “Aiteo has on-boarded the involvement of the renowned Boots & Coots, arguably the leading well control company in the world, working with a local resource. Upon this intervention and conclusion, it is expected that the persistence of the leak alongside its functional consequences will be abated and significantly diminished,” Mathew stated.

Also, senior personnel of AITEO have visited the affected communities and made available, for the use of the communities, relief materials aimed at ameliorating the direct consequences of the incident. At Opu-Nembe Kingdom where the Aiteo delegation was received by the traditional ruler, His Royal Majesty, Dr Biobelemoye Josiah Ogbodo VIII, his council of chiefs and foremost indigenes and government officials, the King said, “We are happy that Aiteo has initiated this visit to support the community at this time and urge it to continue to work with us as partners in progress on its corporate goals in the community.”

Similarly, the Aiteo Group CEO, Mr Benedict Peters, has extended his assurances to the affected communities affirming, “We are doing everything in our power to contain this spill and ameliorate the situation as rapidly, safely and responsibly as possible. We have mobilized best-in-class resources and expertise to put this mishap behind us. Be rest assured of our resolve to limit the escape of oil and protect the ecosystem from its effects.”

In the statement signed by Mathew, the company averred that it remains committed to ensuring immediately that the circumstances are brought under better control and ascertaining the immediate and remote causes of the leak.

Furthermore, “It is important that we affirm our preliminary view based on our assessment of the proximate circumstances that it will be difficult to exclude deliberate tampering of the well by oil thieves attempting to siphon crude directly from the wellhead. In our view, sabotage remains the most imminent cause of this incident,” the company stated.

“Oil theft and asset vandalism continue to present the biggest challenge we face in the operations of oil and gas production in the Niger Delta area. It has continued to damage the production profile of oil producers in so many ways.

As we commend the relevant security agencies with whom we interface to combat this menace, we believe the need and capacity to provide significantly more remain overwhelmingly critical especially because there is so much more to be done to realign the architecture of the delivery infrastructure of oil and gas production in Nigeria in line with the current industry structure of multiple producers operating assets that were previously built and managed by one producer.”

The company reiterated that it feels deeply concerned about the incident and that the circumstances and fortunes of the immediate community remain its most anxious consideration, which it stated had assumed the highest priority alongside making safe the well and its immediate environs.

“It is our fervent desire that in the attainment of this intensely challenging objective, the interests of the proximate community continue to be safeguarded in every material respect by the collective efforts of our company and all the industry professionals whose involvement Aiteo has convoked,” the statement concluded.

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