Ghana: VRA’s Engineer’s Death- The Inside Story
Staff of Ghana’s largest hydropower producer, Volta River Authority (VRA), are mourning the death of one of the finest engineers of the company.
Eric Dogbey, 47, an engineer of Volta River Authority (VRA) at the Kpong Generation Station in the Eastern Region, died in a strange circumstance on Saturday, May 2.
Initial media reports suggested that Eric Dogbey was driving an unregistered Toyota Corolla vehicle at a top speed with one occupant from Juapong to Akuse when he had an accident and died.
However, energynewsafrica.com’s sources within VRA indicated that Mr. Dogbey left the company’s Kpong Generation Station and was heading to Akuse where he lived.
They continued that the late Eric had two occupants onboard-one seated at the front seat while the other sat behind him.
According to the sources, Eric Dogbey stopped the vehicle few metres after VRA security check point near the Kpong Farms, and the occupant at the front seat alighted leaving the one at the rear.
Energynewsafrica.com’s sources revealed that few minutes after the occupant, whose name is not yet known had alighted, the vehicle suddenly sped off, crossed the road to the opposite lane and run into a canal by the roadside.
Both sustained serious degree of injuries and were rushed to the Akuse Government Hospital for treatment, but Eric Dogbey was pronounced dead on arrival.
According to sources, the other occupant who sustained injuries is still on admission and is responding to treatment.
Contrary to reports that Eric Dogbey died because of accident, it emerged that he was shot, leading to his death.
Doctors at the Akuse Government Hospital, where Eric Dogbey was taken to for treatment, detected that there was one entry gun shot at the right back close to his side ribs.
“The gun shot was within the vehicle as the windscreens were all rolled up,” one of the sources explained.
It is unclear who might have shot him, but energynewsafrica.com’s sources averred that looking at the direction of the gun shot it couldn’t have been Mr Eric Dogbey who shot himself.
Preliminary investigation suggest that it was the excruciating pain of the gun shot that terrified the deceased to step on the accelerator which caused the car to move uncontrollably.
Eric Dogbey is said to be one of the most experienced and huge pillar in the practise of engineering in the Kpong Generation Station of VRA.
The body of the deceased has since been deposited at the mortuary.
Investigations into the incident is ongoing by the Akuse police.
Source: www.energynewsafrica.com
South Africa: SANEDI Urges Industries To Practice Energy Efficiency To Avoid Loadshedding
The South African National Energy Development Institute (SANEDI) is urging industries that will resume operations this month, to adhere to energy efficiency practices in order to avoid loadshedding.
As of 1 May, South Africa entered into Stage 4 of the COVID-19 lockdown restrictions, with the mining industry and other companies permitted to start operations.
Across the globe, electricity demand has declined by an estimated 15% due to lockdown and confinement measures.
In South Africa, the lockdown has led to a drop of 30% in energy demand (7,500MW a day) as energy-intensive mining and manufacturing industries, which account for about 60% of national consumption, have not been fully operational.
SANEDI warns that the phased unlocking of the economy coupled with imminent colder winter months, will lead to an increase in energy consumption and subsequent strain on the power grid.
“We must at all costs avoid moving into another bout of loadshedding, which we experienced prior to lockdown,” Nkululeko Buthelezi, interim chairperson of SANEDI said.
The organisation stresses that loadshedding will have a devastating effect not only on the recovering economy, but also on the health services such as quarantine and isolation facilities, as well as those convalescing at home.
“We, therefore, encourage all South African households and businesses to use energy wisely, to avoid unnecessary wastage of this valuable resource. Where possible, energy-efficient practices must be implemented to lessen the strain and optimise usage,” Buthelezi emphasised.
The best energy efficiency advice is to always ensure that energy-consuming appliances and devices that are not in use, are switched off.
Other easily implementable and short-term attainable energy efficiency practices include switching over to energy-saving LED globes, using LPG (liquefied petroleum gas) gas for cooking and heating.
As well as always purchasing energy-efficient appliances, which are clearly indicated in the form of an Energy Efficient Appliance Label, displayed on most domestic appliances for sale, when allowed to do so under the lock-down Regulations.
“We must emphasise the need for everyone to work together, just as we have stood together as a nation, to fight the virus. We urge people to switch-off non-essential appliances and to become more aware of how we use energy over the next few months,” Buthelezi concluded.
Equatorial Guinea Extends Oil And Gas Exploration Licenses By Two Years
Equatorial Guinea’s Ministry of Mines and Hydrocarbons has announced that it will extend exploration licenses for two years and relax capital expenditure requirements for E&P companies amid the low-price climate and reduction in oil demand caused by COVID-19.
The extension of time and resources will particularly aid U.S companies, which represent the lion’s share of investment in Equatorial Guinea’s energy sector and are currently in the early stages of exploration and seismic interpretation of several key offshore blocks.
“We learned from the crisis in 2014/2015 that we need to give extensions to exploration companies to ensure that they save cash,” Gabriel Mbaga Obiang Lima, the Minister of Mines and Hydrocarbons stated.
He continued that: “Liquidity is very important right now. The last thing we want is for [companies] to decide that it is not economical to operate in-country.”
Retaining key explorers and producers in-country reflects Equatorial Guinea’s broader priority to drive global investment into the country, as encapsulated by its 2020 Year of Investment campaign.
Targeting $1 billion dollars in FDI, the year-long initiative, led by the Ministry of Mines and Hydrocarbons, advances the country’s agenda of energy cooperation and investment, fortified by several landmark energy deals to be signed in 2020.
Dallas-based Kosmos Energy will receive an extension to analyse regional data and continue geological surveys of its interests in four offshore exploration blocks (EG-21, EG-24, S and W), with a view to resuming drilling programmes and yield discoveries in 2021.
Houston-based VAALCO Energy will also receive an extension to develop strong prospects identified in offshore Block P, in which it holds a 31% participating interest.
African independent Atlas Oranto, which recently established an outpost in Houston, will continue its development of Block H, in which Phase 1 of the production-sharing contract has been completed and the highly prospective Aleta asset has been identified.
The Nigeria-based explorer also holds a stake in Block EG-02, in which initial interpretation of seismic survey indicates some of the largest hydrocarbon reserves in the region and depicts similarities to discoveries in Blocks I and O in the Douala Basin.
Simultaneous inversion of pre-stack seismic data, along with coherence and spectral decomposition processing has been completed, resulting in the identification of a major upper cretaceous deep-water fan system, comparable to the Liza discovery offshore Guyana.
While some elements of work programmes will be delayed by COVID-19, other key energy projects remain on track, such as Noble Energy and Marathon Oil’s Alen backfill project.
According to the Africa Oil & Power Conference, pipelines for the development have already been installed, and gas feed from the Alen and Aseng fields to onshore processing facilities at the EG LNG Plant in Punta Europa is set to come online by November.
Source:www.energynewsafrica.com
Equatorial Guinea: Ministry Takes Bold Steps To Boost Exploration And Production Amidst COVID-19 Pandemic
Equatorial Guinea has signed a new Ministerial Order extending all exploration blocks across its sedimentary basin for two years, taking a strong initiative to support oil companies exploring and producing oil and gas in the Gulf of Guinea.
The order demonstrates Equatorial Guinea’s foresight when it comes to creating an enabling environment for E&P companies amidst current market conditions, and laying the ground for a strong recovery of the sector post-COVID-19.
Under the new measures taken by the Ministry of Mines and Hydrocarbons, exploration companies will benefit from extensions to carry out their seismic and exploratory drilling activities, and producing companies will be benefitting from capital expenditures relaxations.
By allowing for the deferral of some work programs, companies can readjust their expenditures and project’s execution accordingly, and plan for more efficient investments as markets continue to recover.
This is a very strong step in the right direction for the oil & gas sector of Equatorial Guinea, and one that echoes the African Energy Chamber’s Common-sense Energy Agenda released last week on www.EnergyChamber.org.
“Alongside key international partners like the IAGC, the Chamber will continue working with African governments and regulators to embrace our commonsense agenda, and support the industry to ensure that Africa comes out stronger,” declared NJ Ayuk, Executive Chairman at the African Energy Chamber.
“Equatorial Guinea has adopted a market-driven attitude and approach to the current industry challenges, which we believe is a winning strategy to ensure a quick recover of our economies. We strongly encourage neighboring countries to continue their efforts and work with local and international companies to put the right measures in place to support their own industries,” he concluded.
American independents are particularly excited about these new measures. Vaalco Energy, which holds a 31% working interest in Block P, has now a chance to properly regroup and plan for an on-track development of the acreage. Similarly, Kosmos Energy, which operates Blocks W, EG-21 and EG024, can now continue to study the block’s geology under a revised timeline and plan for additional surveys and drilling expenditure on a regional level. As the backfill project continues offshore, Noble Energy is also likely to welcome such policies that give more flexibility in the exploration and production of offshore gas in the country.
African independents like Atlas Oranto Petroleum, which has set up a Houston outpost, will also continue doing work on Blocks H and EG-02. Such acreages contain deposits and fields that have large hydrocarbons prospects comparable to those discovered in Guyana by ExxonMobil.
Mapping of key horizons within EG-02 is now completed and the block promises a strong potential after completion of pre-stack Simultaneous Inversion, Coherency and Spectral Decomposition Processing. Results have been very encouraging and a major upper Cretaceous deep-water fan system has been clearly identified, with Guyana’s Liza field as a potential analogue.
Source:www.energynewsafrica.com
Mitigating Risks In The Current Industry Crisis: The Actions Oil Sector Companies Need To Take (Article)
The compounding effects of the corona virus and oil industry disruptions pose unique and significant challenges, particularly on the African continent where the economies of producing countries are largely dependent on oil revenues. The budgets of countries like Nigeria, Equatorial Guinea and Angola have been made mostly impractical and with annual budgetary goals now unachievable due to these unprecedented events. Nigeria, the continent’s most populous country and its largest oil producer, is expected to cut its 2020 national budget by $4.9 billion. That budget was prepared based on the estimation of crude prices at $57/barrel. With the Brent price at slightly over $20 today, the country is most probably headed towards a recession, absent quick and miraculous interventions like the discovery of a COVID-19 vaccine.
As more countries remain locked down and businesses remain shut because of the pandemic, the demand for oil will remain low, leaving prices equally low. The continuing disruption in the industry distribution chain and the businesses of international oil and gas companies which the African oil market relies heavily on has caused a direct and immediate impact on the local market. Oil and gas producers and service companies from Port Harcourt, Luanda to Juba and emerging producers like Senegal and Mozambique are now faced with a myriad of financial and legal issues. Oil projects have either been suspended, like in the case of BP which issued a force majeure notice to delay taking delivery of the LNG facility for the African Tortue Ahmeyim project in Senegal; or simply terminated like the Tullow Deepwater drillship contract in Ghana.
It is now critical for companies operating in the African oil and gas sector to assess the impact of the pandemic and industry disruptions on their local operations and contractual obligations. With no end in sight, companies need to consider and take all necessary actions to mitigate all associated risks.
I have identified below some crucial issues relating to contracts and local operations.
- Contracts (including Production Sharing, Joint Venture, Service and other Financing Contracts)
- Both parties’ capacity to fulfil capex commitments in joint venture or production sharing contracts;
- Crude prices and global demand for crude which will affect future receivables;
- Ability to obtain other financing post covid-19;
- Political and economic stability in host country;
- Any changes in law that affect the stability of the current contract;
- Local content obligations; and
- The opportunity cost of the deal.
- Tax implications and reliefs
- Force Majeure Provisions
- Employment and Employee Safety
Zambia: ZESCO Limited Loses Over $90K To Vandalism In Q1 Of 2020
ZESCO Limited, formerly Zambia Electricity Supply Company, has recorded a total of 261 cases of vandalism in the first quarter of 2020.
The cost of the vandalism is estimated at 1,657,267.03 Zambian Kwacha (US$ 90, 489.13).
The most vandalised items were Transmission towers, transformers and copper cables (overhead service and underground cables).
The highest number of incidences were recorded on the Copper belt, Southern, North-Western and Lusaka provinces.
“As a corporation we are saddened by this development as it is detrimental to the development of the energy sector and the country at large. As you know electrical equipment involves huge amounts of money and investments and any acts of vandalism is retrogressive and takes the corporation and the country backward,” Hazel M. Zulu (Mrs.) Public Relations Manager ZESCO Limited said in a statement.
“We therefore want to send a stern warning to perpetrators of such vices that ZESCO will not relent in ensuring that the culprits are arrested and brought to book,” the statement added.
It is also important to note that ZESCO recorded a total of 47 arrests in the period under review.
In addition, the corporation successfully secured 12 convictions while 41 cases are still active in the Courts of Law.
“As a Corporation, we remain committed to ensuring that we ‘make it easy for people to live a better life’ as we continue to work vigorously to bring these vile acts to a halt. Our call to the public is to join the fight against vandalism and report any such acts to the police service to ensure that the institution continues to provide sufficient and quality electricity to all its citizens,” the statement concluded.
Source:www.energynewsafrica.com
President Trump Signs Executive Order Protecting U.S Bulk Power System
U.S President Donald Trump has signed an executive order prohibiting bulk power system equipment from foreign companies that his administration believes could put the US electricity system at risk.
The Executive Order on Securing the United States Bulk Power System authorises Energy Secretary Dan Brouillette to prohibit federal agencies and U.S entities from acquiring, transferring or installing bulk power system equipment in “which any foreign country or foreign nation has any interest and the transaction poses an unacceptable risk to national security.”
The order does not single out any country but many have interpreted the new rule to imply that equipment from China could be prohibited.
The Trump Administration and China have been locked in a multi-year trade battle over tariffs and intellectual property rights, among other issues.
“Today, President Trump demonstrated bold leadership to protect America’s bulk-power system and ensure the safety and prosperity of all Americans,” said Secretary Brouillette.
“It is imperative the bulk-power system be secured against exploitation and attacks by foreign threats. This Executive Order will greatly diminish the ability of foreign adversaries to target our critical electric infrastructure.”
The federal government spends millions on bulk power system components annually. Current procurement rules favor contracts based on lowest cost bidders, but the DOE release noted that made the process vulnerable that can exploited by malicious actors.
“Evolving threats facing our critical infrastructure have only served to highlight the supply chain risks faced by all sectors, including energy, and the need to ensure the availability of secure components from American companies and other trusted sources,” reads the DOE release on the executive order.
Accordingly, under this Executive Order, the Secretary of Energy is authorised to do the following:
- Establish and publish criteria for recognizing particular equipment and vendors as “pre-qualified” (pre-qualified vendor list).
- Identify any now-prohibited equipment already in use, allowing the government to develop strategies and work with asset owners to identify, isolate, monitor, and replace this equipment as appropriate.
- Work closely with the Departments of Commerce, Defense, Homeland Security, Interior; the Director of National Intelligence; and other appropriate Federal agencies to carry out the authorities and responsibilities outlined in the Executive Order.
Uganda: Four Hydropower Plants At Risk Due To Rise In Water Levels At Lake Victoria
Uganda’s four hydropower dams are currently under a serious threat due to the rising water levels of Lake Victoria.
The East African country relies almost entirely on four hydroelectric power dams on the River Nile, which is fed by Lake Victoria.
Lake Victoria is a massive trans-boundary body of water shared by Kenya, Tanzania and Uganda with about 23 rivers that bring water into the lake.
Uganda’s Water and Environment Minister, Sam Cheptoris, has said intense rains that started around August last year had raised the lake’s water levels to just under 13.4 metres, a mark last recorded in 1964.
In the early 60s (Around 1964) Lake Victoria’s water levels rose causing flooding around the Lakeshore.
“The increased water level is causing dislodgement of papyrus mats … resulting into huge mass of floating islands, which are dangerous to hydropower infrastructure,” Cheptoris said.
According to Cheptoris, the quick rise in water level has also been accelerated by human activities especially environmental degradation.
“Loss of forest cover, encroachment on wetlands, lakeshores and river banks including poor land use practices, have resulted in soil erosion leading to siltation of our water bodies. This has resulted in speedy movement of water into the lakes and rivers with a lot of silt, which has further reduced water storage capacities of our water bodies,” Cheptoris said in a statement.
On 14 April, Uganda lost power countrywide after papyrus islands carried by surging waters clogged the intake gates at two of the hydropower dams in Jinja in the east of the country.
“This cost government a lot of money to remove,” Cheptoris said, without giving figures.
Sections of waterfront properties such as luxury hotels, including one belonging to a unit of Nairobi-listed Tourism Promotion Services and a Protea Hotel, part of Marriott International, have become submerged in the last few weeks.
Source:www.energynewsafrica.com
On 14 April, Uganda lost power countrywide after papyrus islands carried by surging waters clogged the intake gates at two of the hydropower dams in Jinja in the east of the country.
“This cost government a lot of money to remove,” Cheptoris said, without giving figures.
Sections of waterfront properties such as luxury hotels, including one belonging to a unit of Nairobi-listed Tourism Promotion Services and a Protea Hotel, part of Marriott International, have become submerged in the last few weeks.
Source:www.energynewsafrica.com Nigeria: COVID-19: NNPC Commences Construction Of 200-Bed Infectious Diseases Hospital In Yenagoa
| The Nigerian National Petroleum Corporation (NNPC) over the weekend began the third phase of their COVID-19 support programme with the ground breaking ceremony for a permanent Emergency and Infectious Diseases Hospital for the South-South Region in Yenagoa, Bayelsa State. |
| A press statement issued by NNPC Group General Manager, Group Public Affairs Division, Dr. Kennie Obateru, stated that the event flagged–off the plan by the intervention group to deliver lasting medical infrastructure across the six-geopolitical zones in the Country. |
| Chief Timipre Sylva, Minister of State for Petroleum Resources who spoke at the event affirmed that the project was part of the Nigerian Oil Industry Coalition initiative led by the NNPC to support the nation’s efforts to tackle the COVID-19 pandemic. |
| He reiterated that the Oil Industry was contributing about N21billion worth of support provided through internal procurement processes of contributing companies. |
| Chief Sylva said that Bayelsa State was considered a suitable site for the project given its pioneering role in the history of Oil and Gas in the Country and its current contribution of about 40 per cent to onshore crude oil output. |
| The Group Managing Director of NNPC, Mallam Mele Kyari, who spoke through the corporation’s Group General Manager, National Petroleum Investment Management Services (NAPIMS), who is also the coordinator of the initiative in the Petroleum Industry, Mr. Bala Wunti, disclosed that the corporation was working with its Joint Venture partners across the Upstream, Midstream and Downstream sectors to support the Health Sector. |
| He said that the NNPC-led intervention had allocated the N21billion-worth of support to various International Oil Companies, Indigenous operators with Joint Venture stakes across the oil sector. |
| He explained that the infectious diseases hospital to be sited on a 1,586 square metre-space would serve as zonal isolation centre for COVID-19 and would serve as a referral hospital for communicable diseases after the COVID-19 pandemic. |
| The Managing Director, Nigeria Agip Oil Company (NAOC), Mr Lorenzo Fiorillo, stated at the event that the outbreak of COVID-19 disease had put a lot of strain on healthcare systems and personnel globally. |
| Mr. Fiorillo who spoke through Mr Macwon Jitubo, Head of Community Relations, (NAOC,) said that the company remained sympathetic to help navigate the threat posed by COVID-19 pandemic, which he explained, had resulted in millions of deaths worldwide. |
| He said the project being delivered in Bayelsa State would engender a valuable medical asset to the South South region of the Country. |
| Bayelsa State Governor, Douye Diri, who earlier applauded Sylva for attracting the project to the state, performed the ground-breaking ceremony in company of other dignitaries including Mr Chukwuemaka Nwajiobi, Minister of State for Education, who represented the Chairman of the Presidential Task Force on COVID-19 and Secretary to Government of Federation, Mr Boss Mustapha at the occasion, |
Ghana: Bui Power Authority Supports Ghana Covid-19 Private Sector Fund With GH¢ 50,000
State power producer, Bui Power Authority (BPA), has donated GH¢50,000 to the Ghana Covid-19 Private Sector Fund, to support the construction of a 100-bed infectious disease isolation and treatment facility in Accra.
The Corporate Affairs Manager for the Bui Power Authority, Cherie Lawson Adamu, handed over a cheque to the Managing Trustee of the Fund, Senyo Hosi, at a brief ceremony at the Ga East Municipal Hospital, where the facility is being built.
She said the donation was a ‘token’ from Bui Power Authority to support the Ghana Covid-19 Private Sector Fund.
“It is a good project and we think we have to support you in finishing the project,” Madam Cherie Adamu said after touring the site.
She was impressed by the progress of the construction, which started in the middle of April and is set for completion by the end of May.
Receiving the cheque, Mr. Senyo Hosi, who is the Chief Executive Officer of Chamber of Bulk Oil Distributors and one of the trustees of the Fund thanked the Bui Power Authority for the support for the project and the overall national campaign against Covid-19.
He assured that the project will be completed on schedule.
“We are very honoured to have you not just as a friend and partner to the project but also as a donor. At this time, we all know the challenges the energy sector is facing but for you to still find economic space for such a project, is an indication of your sense of humanity as an authority and your commitment to the cause of this country,” Mr. Hosi said.
The 100-bed isolation and treatment facility will be used to treat critically ill Covid-19 patients when completed. When the epidemic is over, it will also be used to treat and manage other infectious diseases.
The Ghana Covid-19 Private Sector Fund also has plans to build similar facilities in Tamale, Takoradi and Kumasi.
The Ghana Covid-19 Private Sector Fund which was an initiative set up by business people, started with initial GH¢1 million.
They seek to raise at least GH¢100 million from donations given by local and international businesses, as well as the general public to aid in the fight against Covid-19 in Ghana.
For more information on how to donate/contribute, please visit: www.ghanacovid19fund.com
Nigeria: Proposed Free Electricity Supply Is Not Feasible-Power Minister
The Federal Government’s decision to allow Nigerians to enjoy two-month of free electricity supply is unlikely to materialise due to the structure of the electricity supply industry in the country, the Minister of Power Saleh Mamman has said.
Sunday Oduntan the executive director in charge of research and advocacy for the Association of Nigerian Electricity Distributors, made the announcement in early April, stating that the move was meant to reduce the impacts of COVID-19 on Nigerians.
However, THISDAY reported that Minister of Power Saleh Mamman, in a BBC Hausa interview doubted the possibility of executing the proposal, which is estimated to cost the federal government between N100 billion ($257 million) and N120 billion ($308 million) for the two months.
The minister highlighted that the power supply chain is not owned by the federal government only.
He added that if the National Assembly insists on pressing ahead with the plan, its members should come up with fresh ideas on its implementation.
Mamman explained that if the plan is implemented, the federal government will end up paying for the electricity consumed by the rich to the detriment of the extremely poor, adding that over 80 million Nigerians do not have access to on-grid electricity.
“This free electricity bill will be paid with taxpayers’ money and you want to serve the interest of the privileged Nigerians, then the less privileged and the vulnerable what are you going to do for them?
“Every month what we pay as electricity bill, I mean what the distribution companies are paying with the little support from government is a little above N50 billion ($128 million) monthly,” he said.
When asked to comment on the matter, Transmission Company of Nigeria’s General Manager Ndidi Mba, told THISDAY that: “The minister speaks for us. We are a government entity.
“The minister’s office is the policy making arm; so we can’t speak against the minister. The minister and the federal government take the decision and whenever they take that decision, it then cascades, and then it is discussed.”
Source:www.energynewsafrica.com
Ghana: Consumers Start Enjoying Free Electricity Today
Consumers of electricity in the Republic of Ghana have started enjoying the free electricity promised by the President H.E. Nana Addo Dankwa Akufo-Addo.
The GHS1.04 billion electricity relief, which covers the months of April, May and June, is part of measures being introduced by the Akufo-Addo- administration to cushion Ghanaians due to the impact of the Coronavirus pandemic.
The government is bearing the full cost of electricity for lifeline consumers while commercial consumers will enjoy 50 percent payment for the three months.
Some customers who shared their prepaid receipt on social media praised the President for keeping to his promise.
In a video posted on Facebook by a lady known as Lucy Oforiwaah Effah, she is heard loudly saying: “This is a testimony from grandma…so I bought a prepaid GHS30 because I was moving to a different place I needed to top up so I wouldn’t go off today or tomorrow …I saw Covid-19 government relief of GHS120 so my balance is GHS 143.48. God bless you Nana Akufo-Addo… There is no deceit. This is the evidence. It is clear.”
Meanwhile, The Electricity Company of Ghana (ECG) is reminding its prepaid customers to either swipe or insert their cards into their meters before visiting vending points or ECG offices to purchase credit.
The ECG, in a statement, said the directive is to enable it “gather accurate consumption data to ensure a smooth implementation of the Government of Ghana (GoG) COVID-19 Electricity Relief.”
It further advised customers to contact its district offices or call centres to resolve any challenges with regards to the GoG COVID-19 electricity relief.
A copy of prepaid receipt a customer shared on social media
Source: www.energynewsafrica.com
Source: www.energynewsafrica.com Ghana: Fuel Prices To Lose Stability In May-IES
The Institute for Energy Security (IES), an energy think tank in the Republic of Ghana, is predicting that fuel prices on the local market will lose stability in the first pricing window.
The prices of gasoil and gasoline at the pump currently is around GHS4.20 per litre.
However, IES believes that the sharp fall in crude oil prices on the international market and the depreciation of the cedi will cause fuel prices to lose stability.
“Going by the 13.05% reduction in price of Crude oil, combined with the 20.96% and 18.45% considerable fall in the prices of Gasoil and Gasoline respectively on the international market; the Institute for Energy Security (IES) foresees prices of fuel on the local market losing stability in the first Pricing-window of May, 2020.
“The expected fall in prices of fuels at the pump, takes into account the local currency’s marginal depreciation against the U.S. Dollar,” IES said in a statement copied to energynewsafrica.com.
LOCAL FUEL PRICES TO LOSE STABILITY, TO TILT DOWN
REVIEW OF APRIL 2020 SECOND PRICING-WINDOW
Local Fuel Market Performance
Prices at the pump maintained some level of stability as only few but major Oil Marketing Companies (OMCs) including Goil, Total Ghana, Puma and Petrosol shaved-off few Pesewas during the Pricing-window under review as projected by the Institute for Energy Security (IES). Goil, Petrosol, Puma and Total Ghana trimmed their prices to sell at an average price of Gh¢4.18 for Gasoil and Gasoline. However, the period saw most OMCs maintaining their prices at the pump to produce a national average price of Gh¢4.12 for Gasoline and Gh¢4.14 Gasoil.
Within the period under review, Santol, Benab Oil, Nick Petroleum, Frimps, Champion and Cash Oil, joined Zen Petroleum as OMCs that sold the least-priced Gasoline and Gasoil on the local market relative to others in the industry as found by IES Market-scan
World Oil Market
Brent crude price remain largely around the $25 per barrel mark for the Pricing-window under assessment. Prices plummeted below $20 on April 21st, as the market reacted negatively towards an evaporating storage capacity as a result of cratering demand and unmanageable supply glut. Following this, Brent crude declined by 13.05% from $29.88 per barrel recorded at the end of the first Pricing-window of April to close at $25.98 per barrel on average terms at end of the second window.
S&P’s Platts benchmark for fuels shows average Gasoline price tumbled by 18.45% to close at $140.25 per metric tonne, from a previous average of $171.97 per metric tonne; while Gasoil declined by 20.96% to close trading at $185.75 per metric tonne, from a previous average of $235.00 per metric tonne.
Local Forex
Data collated by IES Economic Desk from the Foreign Exchange market shows the Cedi depreciated by 1.07% against the U.S. Dollar, trading at an average price of Gh¢5.69 to the U.S. Dollar over the period; a clear departure from the Gh¢5.63 recorded in the first Pricing-window of April, 2020.
PROJECTIONS FOR MAY 2020 FIRST PRICING-WINDOW
Going by the 13.05% reduction in price of Crude oil, combined with the 20.96% and 18.45% considerable fall in the prices of Gasoil and Gasoline respectively on the international market; the Institute for Energy Security (IES) foresees prices of fuel on the local market losing stability in the first Pricing-window of May, 2020. The expected fall in prices of fuels at the pump, takes into account the local currency’s marginal depreciation against the U.S. Dollar.
Signed:
Raymond Nuworkpor
Research & Policy Analyst
(0543887669)
Ghana: GHS 100B Stimulus Package Should Benefit OMCs Too-COPEC
The Chamber of Petroleum Consumers Ghana (COPEC) has advised the government of Ghana not to leave Oil Marketing Companies (OMCs) out of the stimulus packages to support the SMEs.
The President of the West African nation, H.E. Nana Akufo-Addo, recently announced GHc 100 billion stimulus package to cushion households and businesses because of the impact of the Coronavirus.
The amount is expected to be disbursed from May 1.
A statement issued by COPEC noted that the adverse effects of the Coronavirus on volumes and revenues have forced some OMCs to cut down on staff; others have refused to lay off.
COPEC called on the state to ensure the various oil and gas companies are not left out in the announced SME support as a lot are reeling heavily under the harsh effects of three weeks’ lockdown and subsequent low volumes and revenues which can increase job losses and redundancy within the country.
“We further call on the regulator of the downstream (NPA) to also work out a mechanism to ease down on the heavy licence renewal fees charged to these companies to enable them adjust to the vagaries of the Coronavirus outbreak on their businesses with the view to ensuring they keep fuel prices lower for Ghanaians without the tendency to increase or collect their full margins which can only lead to increases in pump prices.
“Finally, we will like to reiterate an earlier call on the Ghana Revenue Authority to give a moratorium for the next six months to oil companies instead of the current one spanning up to end of July, to file their returns later than the current 45 days since sales volumes across the board has reduced significantly, and any attempts to enforce the earlier 21 or 45-day collections could only mean going to the banks to borrow, which, eventually, places undue pressures on them to engage in all manner of games to survive.”
Source: www.energynewsafrica.com