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FG Slashes Price of Petrol to N87/Litre



In response to the slump in crude oil prices in the international market, the federal government has announced a corresponding reduction in the pump price of petrol from N97 a litre to N87 a litre.

Making this known last night, the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, said the price cut took effect from midnight on Sunday.

In a statement, the minister said: “As you may be aware, there has been a lot of volatility in the oil market in the past few months and due to this the importation prices of our petroleum products have been impacted.

“Therefore, with the approval and directive of Mr. President and by virtue of Section 6 clause 1 of the Nigerian Petroleum Act, it is my responsibility as Minister of Petroleum Resources to hereby announce a reduction in the pump price of Premium Motor Spirit (Petrol) from N97 per litre pump price down to N87 per litre pump price, effective from twelve (12) midnight Sunday, 18th of January 2015.”

The Department of Petroleum Resources (DPR) and the Petroleum Products Pricing Regulatory Agency (PPPRA) have been mandated to ensure compliance.

The federal government has been under pressure from the All Progressives Congress (APC) and the public to reduce the price of petrol, arguing that subsidy on the commodity was eliminated once oil prices fell below $70 a barrel.

THISDAY had also exclusively reported as far back as October that with the oil price slump, the federal government would have to either remove the subsidy on petrol or lower the official price of the commodity.

In a related issue, crude oil drillers in the United States (US) have taken a record number of oil rigs out of service in the past six weeks as member countries of the Organisation of Petroleum Exporting Countries (OPEC) keep their oil production at 30 million barrels per day (mbpd), thereby sending prices tumbling to below $50 a barrel.

The US oil rig count has fallen by 209 since December 5, 2014, the steepest six-week decline since Baker Hughes Inc. (BHI) began tracking the data in July 1987, reported Bloomberg yesterday.

Market reports said that the count was down 55 this week to 1,366 and horizontal rigs used in US shale formations that account for virtually all of the nation’s oil production growth fell by 48, the biggest single-week drop.

Bloomberg quoted analysts, including HSBC Holdings Plc, as stating that the decline showed that OPEC countries are winning the fight for market share and slowing the growth that has propelled US oil production to the highest in at least three decades.

OPEC’s decision at its 166th General Meeting in Vienna last November not to curb its production output amid increasing supplies from the US and other non-OPEC countries has driven global oil prices down 58 per cent since June.

“OPEC’s strategy is working, and it will be obvious in US production by mid-year when growth from shale players will come to a halt,” James Williams, president of energy consulting company WTRG Economics in London, Arkansas, was quoted to have said by telephone to Bloomberg, adding: “You can imagine the impact on any industry from a 50 per cent impact on sales.”

Nigeria, like most OPEC countries, has been impacted by the drop in the price of crude oil. However, OPEC member countries like the United Arab Emirates (UAE) and Saudi Arabia have maintained that it was up to shale oil producers and not OPEC to cut production.

While the West Texas Intermediate for February delivery rose $2.44 on Friday to settle at $48.69 a barrel on the New York Mercantile Exchange, up 33 cents for the week, the first gain since November, Brent, the international benchmark, rose $1.90 to end the day at $50.17 on the London-based ICE Futures Europe Exchange, a weekly gain of 6 cents for the front-month contract.

“Prices are being forced towards levels that would force outright shut-ins in high-cost areas, mainly in Canada and the US,” Societe Generale SA (GLE) analysts including Mark Keenan, its head of commodities research for Asia in Singapore, said in a research note.

However, the slump in oil rigs is yet to stop the unprecedented growth in US oil production, which added 60,000 barrels a day in the week ended January 9 to 9.19 million, the US Energy Information Administration data has shown.

Bloomberg also reported that projects are being cancelled and budgets cut around the globe. For instance, Royal Dutch Shell Plc was reported to have called off a $6.5 billion project in Qatar, while contract drillers Helmerich & Payne Inc. (HP) and Pioneer Energy Services Corp. (PES) lost US rig contracts.

Mexican oil service companies also cut more than 10,000 people and Suncor Energy Inc. (SU) fired workers in Canada.

HSBC analysts, including Gordon Gray, said in a research note that “we are seeing leading indicators of weak prices starting to drive the rebalancing that OPEC is seeking to achieve”.

Rigs drilling for natural gas in the US also dropped by 19 to 310 and inventories of the heating fuel in the lower 48 states totalled 2.853 trillion cubic feet last week, 11 per cent above year-earlier levels

Bloomberg however records that natural gas for February delivery on Friday dropped 3.1 cents to settle at $3.127 per million British thermal units on the NYMEX, down 29 per cent in the past year.—This Day


WAIVER CESSATION: Igbokwe urges NIMASA to evolve stronger collaboration with Ships owners



…Stresses the need for timely disbursement of N44.6billion CVFF***

Highly revered Nigerian Maritime Lawyer, and Senior Advocate of Nigeria (SAN), Mike Igbokwe has urged the Nigeria Maritime Administration and safety Agency (NIMASA) to partner with ship owners and relevant association in the industry to evolving a more vibrant merchant shipping and cabotage trade regime.

Igbokwe gave the counsel during his paper presentation at the just concluded two-day stakeholders’ meeting on Cabotage waiver restrictions, organized by NIMASA.

“NIMASA and shipowners should develop merchant shipping including cabotage trade. A good start is to partner with the relevant associations in this field, such as the Nigeria Indigenous Shipowners Association (NISA), Shipowners Association of Nigeria (SOAN), Oil Trade Group & Maritime Trade Group of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA).

“A cursory look at their vision, mission and objectives, show that they are willing to improve the maritime sector, not just for their members but for stakeholders in the maritime economy and the country”.

Adding that it is of utmost importance for NIMASA to have a through briefing and regular consultation with ships owners, in other to have insight on the challenges facing the ship owners.

“It is of utmost importance for NIMASA to have a thorough briefing and regular consultations with shipowners, to receive insight on the challenges they face, and how the Agency can assist in solving them and encouraging them to invest and participate in the maritime sector, for its development. 

“NIMASA should see them as partners in progress because, if they do not invest in buying ships and registering them in Nigeria, there would be no Nigerian-owned ships in its Register and NIMASA would be unable to discharge its main objective.

The Maritime lawyer also urged NIMASA  to disburse the Cabotage Vessel Financing Fund (CVFF)that currently stands at about N44.6 billion.

“Lest it be forgotten, what is on the lips of almost every shipowner, is the need to disburse the Cabotage Vessel Financing Fund (the CVFF’), which was established by the Coastal and Inland Shipping Act, 2003. It was established to promote the development of indigenous ship acquisition capacity, by providing financial assistance to Nigerian citizens and shipping companies wholly owned by Nigerian operating in the domestic coastal shipping, to purchase and maintain vessels and build shipping capacity. 

“Research shows that this fund has grown to about N44.6billion; and that due to its non-disbursement, financial institutions have repossessed some vessels, resulting in a 43% reduction of the number of operational indigenous shipping companies in Nigeria, in the past few years. 

“Without beating around the bush, to promote indigenous maritime development, prompt action must be taken by NIMASA to commence the disbursement of this Fund to qualified shipowners pursuant to the extant Cabotage Vessel Financing Fund (“CVFF”) Regulations.

Mike Igbokwe (SAN)

“Indeed, as part of its statutory functions, NIMASA is to enforce and administer the provisions of the Cabotage Act 2003 and develop and implement policies and programmes which will facilitate the growth of local capacity in ownership, manning and construction of ships and other maritime infrastructure. Disbursing the CVFF is one of the ways NIMASA can fulfill this mandate.

“To assist in this task, there must be collaboration between NIMASA, financial institutions, the Minister of Transportation, as contained in the CVFF Regulations that are yet to be implemented”, the legal guru highlighted further. 

He urged the agency to create the right environment for its stakeholders to build on and engender the needed capacities to fill the gaps; and ensure that steps are being taken to solve the challenges being faced by stakeholders.

“Lastly, which is the main reason why we are all here, cessation of ministerial waivers on some cabotage requirements, which I believe is worth applause in favour of NIMASA. 

“This is because it appears that the readiness to obtain/grant waivers had made some of the vessels and their owners engaged in cabotage trade, to become complacent and indifferent in quickly ensuring that they updated their capacities, so as not to require the waivers. 

“The cessation of waivers is a way of forcing the relevant stakeholders of the maritime sector, to find workable solutions within, for maritime development and fill the gaps in the local capacities in 100% Nigerian crewing, ship ownership, and ship building, that had necessitated the existence of the waivers since about 15 years ago, when the Cabotage Act came into being. 

“However, NIMASA must ensure that the right environment is provided for its stakeholders to build and possess the needed capacities to fill the gaps; and ensure that steps are being taken to solve the challenges being faced by stakeholders. Or better still, that they are solved within the next 5 years of its intention to stop granting waivers”, he further explained. 

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Breaking News: The Funeral Rites of Matriarch C. Ogbeifun is Live



The Burial Ceremony of Engr. Greg Ogbeifun’s mother is live. Watch on the website: and on Youtube: Maritimefirst Newspaper.

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Wind Farm Vessel Collision Leaves 15 Injured



…As Valles Steamship Orders 112,000 dwt Tanker from South Korea***

A wind farm supply vessel and a cargo ship collided in the Baltic Sea on Tuesday leaving 15 injured.

The Cyprus-flagged 80-meter general cargo ship Raba collided with Denmark-flagged 31-meter wind farm supply vessel World Bora near Rügen Island, about three nautical miles off the coast of Hamburg. 

Many of those injured were service engineers on the wind farm vessel, and 10 were seriously hurt. 

They were headed to Iberdrola’s 350MW Wikinger wind farm. Nine of the people on board the World Bora were employees of Siemens Gamesa, two were employees of Iberdrola and four were crew.

The cause of the incident is not yet known, and no pollution has been reported.

After the collision, the two ships were able to proceed to Rügen under their own power, and the injured were then taken to hospital. 

Lifeboat crews from the German Maritime Search and Rescue Service tended to them prior to their transport to hospital via ambulance and helicopter.

“Iberdrola wishes to thank the rescue services for their diligence and professionalism,” the company said in a statement.

In the meantime, the Hong Kong-based shipowner Valles Steamship has ordered a new 112,000 dwt crude oil tanker from South Korea’s Sumitomo Heavy Industries Marine & Engineering.

Sumitomo is to deliver the Aframax to Valles Steamship by the end of 2020, according to data provided by Asiasis.

The newbuild Aframax will join seven other Aframaxes in Valles Steamship’s fleet. Other ships operated by the company include Panamax bulkers and medium and long range product tankers.

The company’s most-recently delivered unit is the 114,426 dwt Aframax tanker Seagalaxy. The naming and delivery of the tanker took place in February 2019, at Namura Shipbuilding’s yard in Japan.

Maritime Executive with additional report from World Maritime News

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