By Collins Olayinka:
TO engender a hitch-free supply of gas for power generation purposes in the country and facilitate crude transportation to Warri and Kaduna refineries, Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Mohammed Barkindo, has written a formal letter to the Minister of Defence, Maj.-Gen. Godwin Abbey on the need to come up with a special security arrangement to secure the country’s pipelines.
The Guardian learnt at the weekend in Abuja that in the letter, Barkindo disclosed that the evacuation of condensate and failure to provide security were factors that could plunge the country in total power blackout and cause it to lose huge revenue that should accrue to it through the sale of oil on the global market.
But the NNPC at the weekend started the evacuation of condensate lying fallow at the facilities of the Shell Petroleum Development Company (SPDC) in Warri, which has posed threats to power supply in the country.
The SPDC, last week, raised the alarm that it might be compelled to shut down its four gas plants in Utorogu, Ughelli, Oben and Sapele due to the non-evacuation of condensate from its plants, with dire consequence for the power supply situation in the country.
The condensate evacuation had remained intractable due to damages inflicted on the vital SPDC-operated Trans Forcados Pipeline system by incessant militant attacks.
The alternative option of transferring condensate through the Ughelli Pump Station, UPS to WRPC is not only unsustainable but fraught with operational, technical and safety concerns.
However, despite the challenges, the NNPC in response to the impending national power crisis, on Friday commenced the evacuation of 140,000 barrels of condensate from Shell’s facility at Ughelli through Warri Refinery.
Group Executive Director, Refining and Petro-chemicals, NNPC, Austen Oniwon confirmed that two vessels were dedicated through the weekend to evacuate the condensate from WRPC tanks.
He explained that this would give the SPDC a breather of about three weeks within which additional measures could be taken to improve the situation in the medium term.
Meanwhile, power supply in the country might receive a major boost as oil and gas giants, Chevron Nigeria Limited, is poised to supply 185 million standard cubic feet of gas per day to the Power Holding Company of Nigeria (PHCN).
Initially, Chevron was billed to deliver the gas to PHCN plants in the first week of this month. It is now set to deliver the gas before the end of this week, according to sources at a meeting of gas committee and the Presidency at the weekend in Abuja.
Regardless of this prospect, President, Nigeria Rally Movement (NRM), Leonard Shilgba, has called for the immediate sack of the Minister of Power, Rilwan Babalola and his Minister of State, over the Federal Government’s inability to meet the 6000 megawatts power target last December.
The NRM also stated that its call was based on the “self-defeatist comments credited to Babalola to the effects that there are some serious obstacles beyond the capacity of the Ministry to surmount in the quest to generate more powers.”
The group said: “Acting President Goodluck Jonathan must relieve the Minister of Power and his Minister of State of their responsibilities in the Power ministry. They have lost the trust of Nigerians and moral authority to superintend the ministry.
“Having failed to deliver the 6,000 MW promised by December 2009, how does Dr. Jonathan expect Nigerians to believe he is serious about solving the electricity problem if he still keeps those discredited men in charge.”
In the letter to Abbe, Barkindo wrote: “The Honourable Minister is therefore requested to please note the frequent damages to the Trans-Forcados Pipeline (TFP) and the serious implications it has on the reliable supply of both power and petroleum products to the nation.
“It is therefore requested that appropriate steps be taken to ensure the urgent recovery and security of the pipeline, especially in view of the prospects for disruption to gas supply to Power Holding Company of Nigeria (PHCN) by 21st February 2010.”
The letter dated February 12, 2010 was also copied to Acting President Jonathan; Ministers of Petroleum Resources, Rilwan Lukman and Odein Ajumogobia; Babalola; and Delta State Governor, Emmanuel Uduaghan.
The GMD of NNPC noted that the “TFP is a very strategic pipeline for export of crude oil with a capacity of over 400,000 barrels per day, to the Forcados export terminal,” stressing that a shutdown of the pipeline would have significant negative impact on the country’s revenue profile.
He said the attack on the TFP had resulted in the inability of the SPDC to transmit condensate produced alonside gas from Ughelli, Sapele, Oben and Utorogu to the Forcados export terminal.
A stoppage of the condensate production would result in the shutdown of gas supply to PHCN from those locations.
The NNPC chief noted that in the past it had been necessary to transfer the condensate to Warri Refinery and Petrochemical Company (WRPC) tanks for export in order to ensure the continuity of gas supply to PHCN.
However the corrosive nature of the condensate and the acidic water that comes with it has caused substantial damage to the WRPC tanks.
Barkindo said following the repair of the Escravos to Warri oil pipeline, crude has been delivered to WRPC, which has resumed operations.
He also disclosed that crude was being pumped to Kaduna Refinery and Petrochemical Company (KRPC) to resume operations.
Oniwon said: “Our next proposal is to further effectively manage the condensate in the medium term for the WRPC to take on cargo of Forcados blend which we learnt has an API of about 28. We can blend 100 per cent of SPDC’s condensate and still make it conform to the process in our plants. With these we can manage the condensate more efficiently and SPDC can operate its facilities on a more continuous basis.”
The NNPC management would on Wednesday meet with top hierarchy and technical team of SPDC led by its Managing Director and Country Chairman, Shell Companies in Nigeria, Mutiu Sunmonu, in Abuja with a view to furthering discussions.
The parley, which is being convened at the instance of the NNPC, would undertake a review of facilities around the western axis to improve operational flexibilities and create alternatives to address the vulnerability of the Trans Forcados Pipelines.
The meeting will also seek solution to the issue of persistent sour water management at Shell’s Ughelli facility (an effluent from the production process), which the WRPC has been grappling with after being laden with a ‘tankful’ from SPDC six months ago.
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