- As Again, oil prices hit over $50 per barrel
The Bill for an Act to repeal and re-enact the Oil and Gas Free Zone Authority Act on Wednesday, passed the second reading at the House of Representatives.
Sponsored by Rep. Emmanuel Orker-Jev and four other legislators, the bill seeks to liberalise oil and gas free zone and make the authority more responsive to its mandate.
Leading the debate, Orker-Jev said Onne/Ikpokiri in Rivers was currently the only Oil and Gas Free Zone by the provisions of the existing Act and the powers of the President.
According to Orker-Jev, the bill seeks to liberalise the zones and provide for the establishment and designation of oil free zones and sub-zones in the country.
“The bill also seeks to expand the board of the authority and subject the appointment of Board chairman to Senate confirmation”, indicated Orker-Jev, stressing that if the bill is passed, it would make business more transparent, result-oriented and less cumbersome.
Also contributing, Rep. Uzoma Nkem-Abonta (Abia-PDP) said that the bill sought to place oil and gas businesses in their rightful place.
According to him, going by the current trends, there is need to maximise the benefit of the oil and gas free zones and ensure inclusion of local content.
The lawmaker said the amendment would help to account for all oil and gas business transactions in the country.
On his part, Rep. Sylvester Ogbaga (Ebonyi-PDP) said the oil and gas free zone in the country was considered the best in Africa; and if the bill was passed, it will reduce the challenges currently facing the zone and stem the continuous loss of revenue in the sector.
In the meantime, Nigeria’s Bonny Light and other crude oil grades have risen from $49 per barrel to over $50 per barrel in the global market following a significant drop in the inventories of United States yesterday.
A survey of the oil markets showed that the price of Brent, usually used to benchmark other crude oil grades rose from $46 to $50.42 per barrel. It also showed that the prices of WTI and the Organisation of Petroleum Exporting Countries, OPEC Basket stood at $47.54 and $46.87 per barrel respectively.
According to OPEC, “The price of OPEC basket of thirteen crudes stood at $46.83 a barrel on Tuesday, compared with $46.87 the previous day, according to OPEC Secretariat calculations.
“The OPEC Reference Basket of Crudes (ORB) is made up of the following: Saharan Blend (Algeria), Girassol (Angola), Oriente (Ecuador), Rabi Light (Gabon), Iran Heavy (Islamic Republic of Iran), Basra Light (Iraq), Kuwait Export (Kuwait), Es Sider (Libya), Bonny Light (Nigeria), Qatar Marine (Qatar), Arab Light (Saudi Arabia), Murban (UAE) and Merey (Venezuela),” it stated.
The American Petroleum Institute reported a fall in U.S. crude inventories by 5.8 million barrels last week, which was more than the 1.8 million-barrel slide analysts predicted.
Investigations showed that the rise in prices coincide with the making of additional export from Nigeria. The export was made by LEKOIL, the oil and gas exploration, development and production company with a focus on Africa.
The company disclosed that the first crude cargo produced from the Otakikpo Marginal Field in OML 11 has been lifted from the FSO AilsaCraig by Shell Western Supply and Trading Limited, a subsidiary of Royal Dutch Shell.
According to the company, “120,000 barrels of gross production have been lifted. Under the terms of the Crude Sales Agreement with Shell Trading, the Company is due to receive its payment for this crude within the next month.
“Current production at Otakikpo is approximately 5,000 bopd. With the commencement of regular liftings, the Company is focused on ramping up to production of 10,000 bopd, now expected to be by year-end. Key components to achieve this Phase 1 milestone involve completing the expansion of onsite storage capacity – currently being undertaken with minimal capex required – and utilising a higher capacity shuttle tanker.
“Non-operational days from the minor reconfiguration and optimization of offshore infrastructure has led to average production of approximately 3,000bopd from the four production strings across both wells (Otakikpo-002 and -003)since the start of commercial production, announced on 20 February 2017.”
Additional report from Vanguard