How Alison-Madueke’s Management Style Is Killing Nigeria’s Oil industry, Threatening Revenue Flow

Delays in taking vital decisions in the oil and gas industry are fuelling concerns about Nigeria’s prospect of meeting her targets of increased daily oil production capacity and enhanced national reserve by 2020. Industry operators blame the Minister of Petroleum, Diezani Alison-Madueke, for an increasingly lethargic style that has slowed major decisions and processes – from board meetings to licence renewals – failings that now threaten the government’s projected expansion of production frontiers and more revenues. One operator particularly accused Mrs. Alison-Madueke of “microIs -managing the entire industry as her personal estate using her personal aides to carry out key policies, rather than designated officials.”

The Federal Government wants to raise daily oil production from the current average of 2.15 million barrels per day, BPD, to four million barrels, and reserves from about 35 billion barrels to 40 billion. In July, the Governor of the Central Bank of Nigeria [CBN], Godwin Emefiele, said at the end of the Monetary Policy Committee that oil industry performance improved marginally from -9.36 per cent in the 4th quarter of 2013 to -6.60 per cent in the first quarter of 2014. Overall, the CBN Economic Report for April 2014 showed slow growth, with oil production increasing from 1.86 million barrels per day or 52.08 million barrels per month in February, to 1.90 million barrels per day, or 57 million barrels in April.
But, the marginal growth has failed to suppress mounting concerns among key operators about the consistent failure of the industry to meet its growth projections in virtually all areas of operation.

Sluggish management


Most industry operators, particularly major oil companies, who spoke with our reporter on condition of anonymity for fear of victimization, blamed the industry’s woes and its poor turnover on Mrs. Alison-Madueke’s increasingly sluggish style. The operators criticized the minister’s management style, and one operator particularly blamed her for “micro-managing the entire industry as her personal estate using her personal aides to carry out key policies, rather than designated officials.” At the NNPC, where she is the Chairman of its Board, a top official, who would not want his name mention to avoid being victimized, accused the Minister of side-lining the management in most important decisions, preferring to use her “powerful aides”.

According to the official, until recently, one Eric Ufo, one of the Minister’s many Personal Assistants/Special Advisers, was charged with the responsibility of interfacing with key industry players.

After Mr. Ufo, the Minister appointed Kevin Alonzo and Kelvin Okpere as replacements, with wider powers. “These assistants are so powerful that whenever they invoke the name of the Minister, industry players cower in fear,” a senior member of the Nigerian Association of Petroleum Explorationists, NAPE, told our reporter. “They have become the middlemen between the Minister and the industry on all issues, including crude oil lifting.” Consequently, the muddling of the chain of command and the abuse of approval processes through the use of personal aides over key officials has left the industry replete with scores of delayed approvals awaiting the Minister’s attention. “While the Minister wants to see every memo, she is always never there to see it,” said the NNPC official, who also lamented the inability of the Board of the Company to meet regularly. The NNPC Act 1977 demands that the Board meets not less than four times each year. But that schedule is hardly met as meetings are often deferred.

How such delays extend to other policy timelines played out in the government’s plan to open up new oil production areas, called acreages. The minister had in November 2013 announced plans by the Federal Government to hold the second marginal field licensing round to allocate existing marginal oil acreages to new operators.
After several postponements, the exercise was rescheduled for March 2014. While the minister announced that the DPR would publish bid guidelines, no such action has been taken till date. “To date, prospective investors who looked forward to the bid round have been left in limbo,” a distraught official in one of the indigenous oil companies lamented. “Not even the marginal oil blocks to be included in the bid basket for sale have been identified. Nobody can say with certainty what to expect about the exercise,” the source said.

The pall of uncertainty appears to be pervading the operations of the six oil majors. Apart from ExxonMobil, which had its operational lease renewed in 2012 after a protracted disagreement, all the other multinational oil companies, including Shell, Chevron, Total, Agip and PanOcean, all operating Joint ventures with the NNPC, are doing so with expired leases.

Growing frustration


The Shell Country Chair and Managing Director, Shell Companies in Nigeria, SCiN, Mutiu Sunmonu, recently voiced his frustration with the Nigerian Government for the delay in renewing his company’s 20-year lease more than six years since the document expired. At the presentation of Shell’s 2013 Briefing Notes, Mr. Sunmonu lamented how the delay was making it impossible to finalise some of the company’s operational plans, particularly on divestment from some of its onshore concessions. “The delay (in renewing the lease) is affecting divestment,” Mr. Sunmonu said. “You all know you cannot sell what you don’t have.”

A senior official with Chevron, who spoke with our reporter on Saturday in confidence, confirmed the American oil firm had been pressuring the Federal Government for the past two years to renew its expired oil lease.

The Oando Group, which entered into an agreement with ConocoPhillips in December 2012, for the acquisition of Medal Oil Company Limited, had to wait for the Minister’s signature for more than one and a half years before the $1.65 billion deal was approved. The company announced the completion of the deal on July 17. 2014. Some oil and gas projects have equally suffered, as their final investment decisions, FIDs either had to be postponed indefinitely or cancelled after long delays from the Minister’s office. Some projects affected were said to include the data repository system, petroleum products trucking policy and pipelines surveillance and monitoring system to check oil pipeline vandalism.

The projects have either been delayed or abandoned. Among the world’s leading oil producing countries, Nigeria ranks among those with the longest contract approval cycle of between three to five years. There is also the delay in the passage of the Petroleum Industry Bill, PIB, more than five years since the process began, costing the industry more than $125 billion loss since 2009, reliable sources in the Department of Petroleum Resources told this newspaper.

Marginal growth
Detailed industry activities data obtained from the Nigerian National Petroleum Corporation, NNPC, showed a trend towards near stagnation or slow progress that would make realizing set targets difficult or impossible. Since 2012, total rig count, number of exploratory oil wells and those actually drilled by the six multi-national joint venture operators depicted a general decline in production activities.

Total rig count, which usually shows the intensity of industry activities, grew slightly from 17 in 2012 to only 21 in 2013; while total oil rigs in operation grew to 33 in 2013, slightly higher than 29 in 2012.

Similarly, while exploratory wells declined from 10 in 2012 to only 7 in 2013, the number of development wells recorded a marginal increase from 63 in 2012 to 64 in 2013, while oil wells actually drilled (138) in 2012 dropped to 102 in 2013. A company-by-company statistics showed that Shell Petroleum Development Company, SPDC, which accounts for more than 50 per cent of Nigeria’s total oil production capacity, deployed only 20 development wells, with eight rig counts, and actually drilled only 35 wells in 2013. ExxonMobil, which had the highest number of development wells deployed (24), had only four rig counts and drilled 30 oil wells.

Chevron, which had only one rig count during the year, deployed as many development wells but actually drilled two, while Nigerian Agip Oil Company, NAOC, which actually drilled 18 oil wells during the year, deployed only eight development wells with only five rig counts. Total, with only one rig count, deployed only 10 development wells, and actually drilled 13, while Pan Ocean Oil, which did not deploy any development well, had two rig counts, and actually drilled four.

But experts say Nigeria will need to do more to increase production, and achieve its set goals by 2020. For a start, the 1,300 exploration wells the oil industry has so far drilled must be surpassed, the Director, Department of Petroleum Resources, DPR, George Osahon, said during the 2014 Nigeria Oil and Gas, NOG conference in February.

The NNPC has put the level of new oil production required by the industry to meet the 2020 targets at an average of about 300,000 and 350,000 barrels per day.

Mum is the word
Efforts to get Mrs. Alison-Madueke to respond to the issues raised by the industry operators were unsuccessful. Several telephone calls to her known local and international telephone numbers were neither answered nor returned. When our reporter got in touch with one of the minister’s powerful aides, Mr. Alonso, he asked for a few days to enable him to fix an interview appointment with the minister. On Friday, July 25, the reporter contacted Mr. Alonzo again. This time he said he was busy at a meeting. He did not answer or return our reporter’s calls for days afterwards. On Wednesday, July 30, the reporter called Mr. Alonzo again. He did not answer the calls but he responded with a text message:

“I haven’t seen the minister, as she has been out of town. I’m out of the office, at a meeting.” A similar call on Thursday morning only received a response from another aide who said Mr. Alonzo said that he would get in touch with the reporter once he was through with his meeting. He is yet to do so as at the time of publishing this report. The reporter also got in touch with the General Manager, Group Public Affairs of the NNPC, Ohi Alegbe, to assist in passing our questions to the Minister and getting her to respond. Mr. Alegbe later said on Thursday that he was unable to reach Mrs. Alison-Madueke as she was said to have traveled outside the country.

-Premium Times

Lagos Female Doctor Contracts Ebola Virus …Lagos Plans Another Isolation Centre, May Isolate 10 People

The Minister of Health, Prof. Onyebuchi Chukwu, on Monday said one of the doctors that treated the Liberian-born American, Patrick Sawyer, who died of the Ebola disease, had contracted the virus.
Chukwu made this known in Abuja as Reuters news agency quoted the Geneva-based World Health Organisation as saying in a statement that Nigeria had four cases, of which three were classed as ‘probable’ Ebola and one as ‘suspected.’

The death toll from the Ebola outbreak, according to WHO, rose from 729 to 887 by August 1. The total number of cases in the four West African countries affected is now 1,603.
Sawyer, who arrived at the Murtala Muhammed Airport, Lagos on July 20, died at an Obalende hospital five days after.

Chukwu said, ‘‘This is now the second case of Ebola virus disease in Nigeria. This victim is one of the doctors who attended to the patient who brought Ebola virus to Nigeria.’’

He also told journalists in Abuja that ‘‘about eight other persons who came into contact with Sawyer, and who had developed the Ebola symptoms, had been quarantined while 70 others were under surveillance.’’
The minister said, “All those who came into contact with the late Sawyer depending on the level of contact are still being traced and being invited every day and they are placed under surveillance just to ensure that the spread of disease is curtailed.”
He added that the Federal Government was currently reinforcing the technical working group on Ebola to include 35 state governments. Lagos State already has a TWG.

The minister allayed the fears being expressed by the public about the corpses that were brought into Anambra and Imo states from some countries which already had records of the deadly disease.
He said, “Medical records have proved that the corpse taken to Imo State was not carrying Ebola while test is being carried out on the one taken to Anambra State.

‘‘We are collaborating with all the state governments to establish isolation wards for persons proven symptomatic to Ebola and a 24- hour emergency operation centre.”

The minister also on Monday inaugurated an Ebola Treatment and Research Group with a mandate to carry out an extensive research into the Ebola virus.
Chukwu said the group would receive and verify claims on Ebola cure; collate and analyse researches on the virus and advise the government as may be appropriate.

The group, according to the minister, has the Director – General of the Nigerian Institute of Pharmaceutical Research and Development and the Director-General of the Nigerian Institute of Medical Research as chairmen.
He added that the Nigerian researcher, who had found evidence of Bitter Kola inhibiting the growth of Ebola virus, Prof. Maurice Iwu,and the Director-General of the Nigerian Centre for Disease Control are also members of the group. Iwu was also a former chairman of the Independent National Electoral Commission.

Chukwu said, “Although the research on bitter kola was not concluded, no progress can be made without research. For now, there is no scientifically proven vaccine or drug for the treatment of Ebola.”

He assured the public that the Federal Government was doing everything to stop the outbreak of the disease but enjoined everybody to embrace good hygiene by constantly washing their hands.
Also on Monday, the President of the Medical and Dental Consultants Association of Nigeria, Dr. Steven Oluwole, said that only one authentic case of Ebola had been documented in Nigeria.
He added that “the risk to all contacts of the case are theoretically unlikely to be uniform.”
Oluwole stressed the need for tracing, screening, follow-up on all contacts and effective control at Nigerian borders as means of checking the spread of the virus.

He described the virus as “a filovirus, which is transmitted to humans from contact with infected wild animals, or consumption of their raw or undercooked meat.”
The scientist listed the susceptible animals as fruit bats, monkeys, chimpanzees and antelopes.
He noted that human to human transmission primarily occurs through contact with body fluids of infected persons, adding that skin and mucous membranes are the main routes of entry.

Infected doctor is not dead –FG:
Just minutes after Chukwu and Oluwole spoke, there were rumours that the doctor who treated Sawyer had died.
The rumour was quickly dismissed by the Director, Centre for Disease Control, Abuja, Prof. Abdulsalami Nasidi.
Nasidi told journalists in Lagos that the doctor had been quarantined and was presently receiving treatment .
He said, ,”We will not be able to release the name of the new contact; but we know that the person is a doctor and a female. The patient is not dead. She is alive. Experts from the local and international organisations are attending to the patient.”

Lagos plans another isolation centre, may isolate 10 people:
In Lagos, We gathered that the state government had begun renovating another centre at the Mainland Infectious Diseases Hospital, Yaba , to isolate and accommodate some of the people that had direct contact with the late Sawyer.

A reliable source, who is also on the team of experts monitoring the testing and surveillance of persons who came into contact with Sawyer, said the building would give more room for them to contain possible infections.
He said, “ We are presently renovating another building at the hospital, so that we can isolate more contacts. This is now important with the recent development. We need to increase vigilance on surveillance on persons who came in contact with him.

“For now, we are looking at isolating at least 10 people that had first contact with him (Sawyer). This is in line with the stated guidelines for the monitoring of the virus by the World Health Organisation.”
The source added that the state government might earmark the Lagos State University Teaching Hospital, Ikeja, as another hospital for isolated persons.
It was learnt that this caused panic among health workers and patients at LASUTH.
A nurse who spoke on condition of anonymity with one of our correspondents, expressed fears that the plan might lead to an outbreak of the disease in the hospital.

She said, “We have been told that it is possible that they may bring in more people that came into contact with him (Sawyer) here. We are scared that LASUTH may not be the best place to bring anybody who may have contracted an highly infectious disease like Ebola. There is too much exposure for us, the health workers and other patients who come to the hospital.”
Earlier, the state Commissioner for Health, Dr. Jide Idris, appealed to striking doctors under the aegis of the Nigerian Medical Association to call off their strike and join the government to fight the Ebola virus.
He said the government would be offering incentives to any health worker who volunteered to work with the team of doctors treating any infected person.

Idris said, “ We also welcome volunteers from the health profession and those who do so shall be given incentives. We also appeal to residents to support the government in fighting the scourge by being cautious.

‘‘As of today, one person out of the eight people who came into contact with the late victim of Ebola has tested positive. The state has established isolation and treatment centre for the patient.
“The members of staff at this centre have also been trained on how to treat and handle patients under their care. The hospital is also provided with enough facilities to ensure that the officials and other patients do not contact the virus.
“The patients under our surveillance were those who came into contact with the late Liberian-American. And the rapid response team has been in communication with these patients who developed fever and other symptoms.

“We will not stop in tracking all those who came into contact with Mr. Sawyer. They remain in isolation until the confirmatory results are in and those who test positive for the virus will remain in isolation until they are no longer infectious.”

FCTA advises residents:
In Abuja, the Federal Capital Territory Administration called on the residents to be vigilant and to report any suspicious case to a health facility nearest to them.
The FCTA Secretary, Health and Human Services Secretariat, Dr. Demola Onakomaiya, made the call at an emergency meeting with the management staff of the secretariat on the preparedness of the FCTA to tackle the disease.
Noting that Ebola virus could be devastating to families and communities, he said it could be controlled through the use of recommended protective measures.

Airlines operators to introduce masks, gloves:
Meanwhile, the upsurge of the Ebola virus has been giving airline operators sleepless nights.
Investigations showed that officials of the airlines have been busy working on measures to ensure the safety of their passengers and crew members.
One of such strategies, We learnt on Monday, is to have their cabin crew members wear gloves permanently in both local and international flights.

In addition, cabin crew members might wear masks to cover their mouths and noses, especially during international flights.
This, according to one of the airline officials, is to reduce the risk of spreading or contracting the disease.
He said, “We are concerned because this Ebola issue is a serious one and all eyes are on the aviation industry. We the operators are on our toes also because it is risky for our officials who are on duty on a daily basis. The issue of gloves may soon be mandatory for everybody and we are still looking at other options.”

US to send 50 experts to W’Africa:
The United States has said it will in the next 30 days send 50 health experts to West Africa to help contain the Ebola outbreak.
The director of the US Centres for Disease Control and Prevention, Dr. Tom Frieden, who made this known in a statement, described the Ebola outbreak as “ the biggest and most complex in history.”
He said, “It will take many months, and it won’t be easy, but Ebola can be stopped. We know what needs to be done. CDC is surging our response, sending 50 additional disease control experts to the region in the next 30 days.”

Trial drug sent to US Ebola victims in Liberia:
A representative of the US National Institutes of Health is said to have contacted the Samaritan’s Purse in Liberia and offered an experimental treatment, known as ZMapp, for the two American patients who had contracted the virus.
Dr. Kent Brantly and Nancy Writebol, who work with the Samaritan’s Purse, an aid organisation, were believed to have contracted the virus from another health care worker in a Liberian hospital.

ZMapp was developed by the biotech firm, Mapp Biopharmaceutical Inc.
Brantly and Writebol were told that ZMapp which was developed by the biotech firm, Mapp Biopharmaceutical Inc., had never been tried before in a human being but that it had shown promise in small experiments with monkeys.

WHO said in its statement on Monday that Guinea has suffered the highest death toll with 358 fatalities out of 485 confirmed Ebola cases so far. Sierra Leone has had the largest number of cases, 646 overall, and 273 deaths, while Liberia has had 468 cases and 255 deaths.
Who said apart from Sawyer’s, the other probable Ebola cases in Nigeria were a health-care worker and a Nigerian who had been to Guinea.