The Association of Ghana Industries in the Republic of Ghana, West Africa, has refuted media reports suggesting that they have 51% shares in the Power Distribution Service (PDS) concession but has been diverted to Enterprise Group.
According to a statement copied to energynewsafrica.com and signed by Mr. Seth Twum-Akwaboah, AGI stated that they were part of the initial stakeholder engagements over the concession agreement but their discussions focused on Private Sector Participation (PSP) and the need to ensure local content in the concession agreement.
“We are therefore not aware of any diversion of shares due AGI to the Enterprise Group as reported,” the statement reads.
Read full statement belowAGI rubbishes claims of 51% shares in PDS
Halliburton Company, one of the world’s largest providers of products and services to the energy industry, is touting the growth success of its subsidiary in Argentina as the company celebrates 100 years’ anniversary of its existence.
The company said since its operations began in the country in 1956, Halliburton Argentina has led local oil and gas industry development by introducing new techniques and technology to the region.
“This monumental milestone is a testament to the commitment and dedication of our past and present employees, as well as our continued focus on superior customer service,” said Jorge Rivera, Vice President of Halliburton Argentina.
“We are excited to celebrate this achievement and the work of our Argentinian employees who are inspired by the past and leading into the future by bringing innovative technologies and services to the country,” a statement posted on the company’s website said.
Halliburton has almost 2,000 employees in Argentina, who, for more than 60 years, have consistently broken efficiency records and established new quality standards by implementing leading technology and offering integrated solutions to their customers.
For example, on September 23, 1959, three years after its establishment in the country, Halliburton Argentina performed the country’s first hydraulic fracturing operation in the Sierra Barrosa field, where 20,000 pounds of proppant was pumped.
Since that time, Halliburton Argentina has had a key role in the development of conventional and unconventional fields and offshore projects in the country.
The statement highlighted on some of the company’s milestones throughout its more than 60 years in Argentina as: achieving the world record of extended reach oil wells in Tierra del Fuego in 1999; building the first proppant warehouse and distribution facility in Argentina, located in La Meseta, Neuquén, dedicated to providing and mobilising frac-sand to enhance efficiency rates in 2014; building a new service center in Añelo, Neuquén in 2016.
The center provides the Company with better proximity to the Vaca Muerta field and to its customers’ operations in the area; opening the largest, most advanced barite processing plant in the Bahiab Blanca port in 2017.
The Company uses the facility to receive raw material and process it to produce barite under API standards.
Again, in 2018, Halliburton Argentina launched the first iCruise® Intelligent Rotary Steerable System run in Latin America with excellent results, drilling the longest lateral section in an unconventional 8 ½” Vaca Muerta well under the most extreme conditions.
“With the same values that have sustained the company for the past century, Halliburton is leading into the future with a continued focus on innovation, collaboration and execution to deliver superior customer service in Argentina. As a recent example, this year we achieved a fracturing efficiency record with ten stages pumped in 24 hours, introducing a new efficiency paradigm to the local industry,” the statement concluded.
South Africa’s former Minister of Energy, Jeff Radebe, Ambassador Kingsley Mmabolo and Dr Khulu Mbatha, a veteran of the ruling party, the African National Congress, are currently on a continental tour which will see them visit the Presidents of Nigeria, Niger, Ghana, Senegal, Tanzania, the Democratic Republic of Congo and Zambia.
The group of Presidential Special Envoys will deliver a message of solidarity from South Africa’s President Cyril Ramaphosa to the heads of state as a means to assure them that the government is committed to addressing xenophobic attacks which sparked in the Gauteng province earlier this month.
“The Special Envoys are tasked with reassuring fellow African countries that South Africa is committed to the ideals of pan-African unity and solidarity. The Special Envoys will also reaffirm South Africa’s commitment to the rule of law,” a statement from The Presidency of the Republic of South Africa which was copied to energynewsafrica.com by APPO Group said.
According to the statement, Special Envoy Radebe has already met with Nigeria’s President Muhammadu Buhari; President of Ghana, Nana Akufo-Addo and Senegal’s President, Macky Sall since the tour started on September 14, 2019.
As a previous recipient of the 2018 Big Five Energy Award as then South African Minister of Energy. Hon. Jeff Radebe, has reassured the heads of state that Cape Town is safe and secure.
President Macky Sall will attend the fourth annual Africa Oil & Power (AOP) conference and exhibition on October 9 -11 in Cape Town where he will receive the prestigious Africa Oil Man of the Year award at the exclusive AOP gala dinner for his efforts in developing Senegal’s hydrocarbons sector as a key driver of economic growth.
During the conference, Senegal will also launch its oil and gas licensing round, which will unlock the country’s next phase of investment.
The AOP 2019 conference is hosted in partnership with South Africa’s Department of Mineral Resources and Energy, the South African Chamber of Commerce and Industry, the South African Oil & Gas Alliance and the Durban Chamber of Commerce and Industry.
Through its theme #MakeEnergyWork, AOP challenges energy sector leaders and decision makers to share their perspectives on how African countries can use the energy sector to empower the growth and development of other sectors.
The AOP program will feature speakers from state-owned enterprises CEF Group, SANEDI, PetroSA, NERSA, iGas and PASA.
On the 30th of July, the nation woke up to the sudden announcement that government had suspended, with immediate effect, the 20-year concession agreement between it and the Power Distribution Services (PDS) for the take-over of the distribution functions of the Electricity Company of Ghana (ECG). This, surprising and seemingly “swift and firm” action, we were told was effected as a result of the detection of “fundamental and material” breaches of PDS’ obligation of Demand Guarantees (Payment Securities) which is a key requirement in the whole concession agreement.
However, this infamous PDS saga, and particularly the suspension announcement, is now showing itself up as simply a Grand Deception by the government, with the sole intension of protecting the President from implication in the whole deal and to distant him from any knowledge or involvement in this shameful corruption scandal.
Indeed, on the surface, the singular act of suspension of the concession agreement with PDS would adequately fool the casual observer and the masses, as it effectively paints a picture of a “tough”, “no-nonsense” President, who had just discovered that some very, very dirty deals were being perpetrated behind his back to steal the people’s valuable asset (ECG) for the selfish benefit of only those few individuals behind the PDS.
However, upon careful scrutiny of the intriguing issues involved in the deal and the chronology of related events, prior to the suspension announcement, leads us to actually make the inference that the “suspension” action was actually faked to divert attention from the fact that the President was fully aware of what went on in the PDS deal. The suspension action had to be quickly taken, as unfolding events preceding the announcement were leading to the likely exposure of the unholy deal and the likelihood of letting the “cat out of the bag” and lay bare to the public the truth about the scam. As they say, emerging events were casting their shadows and the President saw the dark clouds fast gathering so he quickly took the action to protect himself
The facts of the matter are that over the four months or so after PDS took over the functions of ECG on March 1st, 2019, things had not been well with the power supply industry, as a whole. PDS had consistently failed to meet its financial obligations to the bulk producers of power (VRA and the IPPs) and the system operator (GRIDCO), who together, constitute the value chain for the supply of the power that PDS sells to consumers. Naturally, the power producers and the transmission utility begun to agitate against PDS for non-payment of power already supplied to it for onward sales to consumers. This situation arose because instead of paying the utilities in the value chain, described above, PDS was using the proceeds of power sales to pay for the Demand Guarantee, required under the concession agreement (something it should have done before taking over the national assets of ECG). This fact is adequately reported in the media (i.e. Daily Guide Newspaper of Monday, September 9, 2019 (front page and page 3), under the caption: PDS “Milks” ECG to pay $12 million guarantee).
At this point, it would be recalled that PDS, in self-defense, came out to claim that it had a contract with only ECG and therefore did not owe any utility in the power supply value chain. This posture of PDS begun to create tension among the industry players and was beginning to undermine the stability and financial health of the whole power sector, making it difficult for the utilities to find money to produce electricity and therefore pushing the whole country towards the threat of power curtailment and a looming power supply crisis. At this stage, something had to be quickly done before the situation got out of hand and the secret “behind-the-scene” deals (that have now come to light) got exposed and out of control and possibly engulf the President. So, to protect the President and parry off any possible references to his possible prior knowledge or direct involvement in the scheme, the sudden and unexpected suspension gimmick was effected.
In other words, the suspension announcement was designed to make it appear as if the President got “angry”, upon getting to know what was going on with the PDS deal and decided to quickly act to, as it were, “save the public purse” and the strategic national asset (ECG). Indeed, this assertion is supported by a report on the front page (and page 16) of the Ghanaian Times Newspaper of Saturday, August 10, 2019 with caption: Suspension of PDS power agreement: We’re protecting $3bn ECG assets – Says President).
Since that action by government against PDS, a number of activities, events and actions that are going on in the power distribution market, indicates quite clearly that PDS never got suspended, in the real sense of the word, but is rather still very much in control of that mandate to distribute power in Ghana, in place of ECG. For example, the company has put out several public notices to customers with regards to services and supply of power to this day. The company has also continues to issue bills and collect payments from consumers for the months of August and September, even though the suspension is supposed to be still in force, having taken effect from the 30th of July, 2019.
So, we must pause to ask: Did PDS ever get suspended? The simple and straightforward answer to this equally simple and straightforward question is: No, PDS never got suspended, in the real sense of the word! It is now clear that the hasty announcement, “suspending” PDS with “immediate effect”, was a farce and only intended to hoodwink the whole Ghanaian populace. The chronology of the sequence of events in this PDS/ECG scandal speaks for itself:
On July 30th 2019, Government announced the suspension of PDS, with immediate effect and until investigations into the matter were over.
On the 6th of August, Energy Commission issued a Public notice No. 030819, appointing ECG as interim operator to take over from the suspended PDS.
On Thursday, 8th August (barely two days later), ECG hands over the distribution functions (given to it by the Energy Commission) back to the PDS. (See Ghanaian Times, Saturday, August 10, 2019). So, in effect, PDS never got suspended.
Government just took us all on wild “merry-go-round” by announcing the suspension and then going behind us and getting other government agencies (EC and ECG) to take up the responsibility of giving back the distribution and sales mandate to the supposedly suspended entity. This way, government’s real intention (protecting the PDS deal involving the family and friends) is concealed.
Dr. Kwame Ampofo
So, is it surprising that the Board Chairman of the PDS, Mr. Philip Ayensu, confidently declared that the outcome of the investigation commissioned by the government would clear them of any wrongdoing? (Daily Guide, Tuesday, August 6, 2019, page 3) Actually, we believe in Mr. Philip Ayensu’s assertion because he knows very well what “the game plan” is. The President has used this game plan so frequently (without variation) that we are all now very familiar with this sly modus operandi of the President, which is: first, feign innocence of a scandal, second, suspend the individual (or entity) involved in the reported offence, then later clear that corrupt culprit of any wrongdoing. A few examples out of the many corruption cases could help to establish the pattern of the President’s actions on corruption and to confirm that, truly there exists a “game plan” and that it is real:
The 2018 Australia Olympic Games Visa Racketeering Scandal: This scandal involved the then Deputy Sports Minister, Mr. Pius Enam Hadzide (now Deputy Information Minister). He was first suspended by the President when the scandal broke out. Next, was to call for an investigation into the scandal by the CID. Then, based on the CID report, the President cleared him and later reshuffled him to the Ministry of Information.
The BOST Scandal involving the fraudulent sale of 5million litres of contaminated fuel: When the scandal broke out, Mr. Alfred Obeng, the then CEO of BOST, was immediately suspended. Then, the President directed the CID to investigate the matter, following which he was cleared of any wrongdoing and reinstated.
The Galamsay Bribery Scandal: In a similar fashion, Mr. Charles Bissiw (the culprit), was also suspended, then an investigation into his case was ordered by the President. As it always ends, Mr. Bissiw was later cleared and finally reinstated.
Clearly, there is a “method to the madness” and “the game plan” is, indeed, a well-rehearsed script, which goes like this:
Step 1: Lie low until the stealing by cronies becomes a scandal in the public domain
Step 2: Feign innocence by quickly “suspending” that crony or relation “with immediate effect”
Step 3: Dribble the public by instituting the conduct of sham “investigations”
Step 4: Clear the culprit on the basis of the “investigation” and announce to the public that there was no wrongdoing. Finish! Case closed! Life goes back to normalcy and the family and friends continue to enjoy their booty, shamelessly.
This is precisely what is happening with this infamous PDS scandal and so we should not be surprised that PDS is back working, even in the face of being “suspended with immediate effect. We are now only waiting for the obvious – an announcement clearing them by the Clearing Agent!
What a grand deception!!!Source: Dr, Kwame Ampofo, Former Board Chairman of Energy Commission
Petroleum tanker drivers who load fuel products from the Bulk Oil Storage and Transportation Company’s facility at the Accra Plains Depot near Tema in the Republic of Ghana, West Africa, have pledged their support for the newly appointed managing director of BOST, Edwin A. Provencal.
Chairman of the BOST Tanker Driver Union, Mr. Clement K. Ampadu, who spoke on behalf of the union, said “We want to tell the new MD that he has our support. We will make sure that he succeeds.”
Edwin Provencal, who was the technical advisor of John–Peter Amewu, the Energy Minister of the West African country, was appointed to replace Mr George Mensah Okley following the resignation of the latter.
Reasons for his resignation were not made public but some industry watchers alleged that it had to do with bad governance practices and procurement issues.
In an interview with energynewsafrica.com , Mr Ampadu said he and other members of the union had met with Mr Edwin Provencal to officially introduce themselves to him and interacted with him to know what he intends to bring onboard.
He explained that he and other members of the union were very impressed by the warm reception Mr. Edwin Provencal offered them and how he planned o turn around things at BOST.
“I have been in this industry for over nineteen years and different MD’s have come and gone. Some of them didn’t even have time to listen to your problems.
“But I can tell you that this man is different. He interacted with us and we told him our problems and he assured us that he is there to make sure that things work. One thing that he brought to our attention was that the company, at the moment, doesn’t have product and gave us his word that when there is product, they will all work.”
Fairness in fuel allocationMr Ampadu, however, cautioned Mr Edwin Provencal to be fair in dealing with transporters by making sure that they are all given opportunity to lift fuel
He revealed that during the previous regimes only about ten out of the transporters out of the 700 tanker owners were given fuel allocation, stating that this should not be entertained under his tenure.
“When we met him, I told him to deal well with everyone and not only few. We’re about 700 drivers and so if you allow only about ten tanker owners to work, how do you expect others to feed themselves and their family?” Mr Ampadu posed.
Transfer
Mr Ampadu, who expressed displeasure about some workers whose conduct in the company, he said, was unacceptable, called on the new MD to reshuffle the workers so that those who have stayed at one place for years and managed to form a team that gang up against MDs would no longer have the strength to operate.
The government of Mozambique has received financing from the World Bank toward the cost of the Mozambique Energy for All Project (Proenergia), and intends to apply part of the proceeds toward payments under the contract for supply of electricity meters for the project.
Interested bidders are encouraged to bid for one or several contracts, as further defined in the request for bid documents.
The Electricidade de Moçambique (EDM) now invites sealed bids from eligible bidders for the supply of 300,000 electricity meters for the project, divided into three lots and distributed in 16 locations in Mozambique.
Bidding will be conducted through international competitive procurement using a Request for Bids (RFB) as specified in the World Bank’s “Procurement Regulations for IPF Borrowers” July 2016, revised August 2018 (“Procurement Regulations”), and is open to all eligible Bidders as defined in the Procurement Regulations.
For more tenders click here
Interested eligible bidders may obtain further information from (EDM), Social Energy Directorate (DES), from Mr Silvio Romeu as per email address: [email protected]/[email protected] / [email protected] and inspe t the bidding documents during office hours from 7h30 to 15h30 local time, from Monday to Friday, at the address below.
Bidding documents in English may be purchased by interested bidders upon the submission of a written application to the address below and upon payment of a non-refundable fee of $100 or in a convertible currency.
The method of payment will be ca h to (EDM’s Central Treasury Department – Tesouraria Central da EDM, at Avenue Agostinho Neto N.70, Maputo Mozambique) or by wire transfer to EDM, E.P., account at the address below.
The document will be sent by e-mail or in a CD or Pen drive.
In foreign currency, USD:
Account Name: Electricidade de Moçambique, E.P
Beneficiary Bank: MilleniumBim
Swift Code: BIMOMZMXXXX
Account No. 20594071
NIB: 000100000002059407157
IBAN: MZ59000100000002059407157
In local currency, MZM:
Account Name: Electricidade deMoçambique, E.P
Beneficiary Bank: Millenium Bim
Swift Code: BIMOMZMXXXX
Account No: 1188445
NIB: 0001000000 Moçambique0118844557
IBAN: MZ59000100000000118844557
Bids must be delivered on or before 14h00 Maputo Time on 22 October 2019.
All bids must be accompanied by a bid security of:
Lot 1 – Southern Region – $75,000
Lot 2 – Central Region – $60,000
Lot 3 – Northern Region – $70,000
Attention is drawn to the Procurement Regulations requiring the borrower to disclose information on the successful bidder’s beneficial ownership, as part of the Contract Award Notice, using the Beneficial Ownership Disclosure Form as included in the bid ding document.
Thea address referred to above is:
Electricidade de Moçambiqu e, EP. (EDM)
Social Energy Directorate (DES)
Att: Mr Silvio Romeu, Project Manager
Filipe Samuel Magaia, 368, 1st Floor,
Maputo
Moçambique
Email: [email protected] / [email protected]/[email protected]
Tel: (+258) 21353642; 21353603; 21353630
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Italian oil and gas firm, ENI has announced the successful commissioning and start-up of production of the offshore Baltim South West gas field in Egypt.
Discovered by ENI in June 2016, the field goes on-stream in a record time, just 19 months after the final investment decision (FID) was approved in January 2018.
This result further confirms the success of the strategy adopted by ENI and the company capability in pursuing a fast track approach to development projects.
The field is located in shallow waters 12 kms off the Mediterranean coast of Egypt in the Baltim South development lease. It lies 10 km from the Nooros field, but still within the Great Nooros area. This is an area in which ENI first recognized great gas production potential and where it is conducting other new exploration projects.
With the start-up of the first well, BSW1, the field is now producing with an initial rate of 100 million standard cubic feet per day (scf/d) from a new offshore platform connected to the existing onshore Abu Madi Gas Plant through a new 44 km long, 26 inch diameter pipeline.
The development program foresees the drilling of further five wells with the objective of achieving a production target of 500 million scf/d by the second quarter of 2020. Volumes produced by Baltim South West will further contribute to Egypt’s natural gas export capacity. The overall gas potential from the Great Nooros Area is approximately 3 trillion cubic feet (Tcf) of gas in place, of which about 2 Tcf are in the Nooros field and the remainder in Baltim South West.
ENI, through its subsidiary IEOC, has a 50% interest while BP holds the remaining 50% interest of the contractor’s stake in the development lease of Baltim South. The project is executed by Petrobel, the Operating Company jointly held by ENI and the state corporation Egyptian General Petroleum Corporation (EGPC) on behalf of Medgas, jointly held by contractor (ENI and BP) and EGPC.
ENI has been present in Egypt since 1954, where it is the main producer with approximately 380,000 barrels of oil equivalent per day in equity. Such production is expected to further grow within the year, thanks to the ramp-up of Zohr gas field and progressive ramp-up of Baltim SW field
The government of Uganda through the Ministry of Energy and Mineral Development Uganda has announced the country’s second licensing round.
The round includes five blocks in the Albertine Graben. These blocks are the Avivi, the Omuka, Kasuruban, Turaco, and Ngaji. The blocks cover 1026 sq km, 750 sq km, 1285 sq km, 635 sq km and 1,230 sq km respectively.
Roadshows presenting data on the blocks and terms of the licensing round are being held in London, Houston and Dubai on October 14, 17 and 22.
For a more in-depth look at Uganda’s upcoming licensing round, we welcome you to read our feature article in the July/August issue. Please click here to read more on pages 30-31.
The Enterprise Group, an insurance company in the Republic of Ghana has dismissed claims that 51 percent shares of the Power Distribution Services (PDS) Ghana Limited have been diverted to the company.
“I’m waiting to hear the 51 per cent side of PDS. I’m waiting for somebody to come and tell me how did that 51 per cent move from AGI, which the president Instructed should be taken to AGI for AGI to collate businesses to buy those shares, How did it move to Enterprise? Kwame Jantuah, who is an energy expert quizzed.
“I’m waiting for that and let’s see how the president would act when that happens,” he said this on Accra -based Starr FM last Friday.
However, in a response, the Enterprise Group described the allegations made in the article as utterly false, baseless and lacking any truth or merit.
PDS took over the distribution business of the Electricity Company of Ghana on March 1, 2019 as a result of the Millennium Challenge Corporation’s Power Compact II, which required private sector participation in the Electricity Company of Ghana.
Below is the full response from Enterprise Group
RE: PDS: 51% shares for AGI diverted to Enterprise Group? – Jantuah
The Enterprise Group has taken notice of a news story on www.starrfm.com dated 16 September, 2019 captioned PDS: 51% shares for AGI diverted to Enterprise Group? – Jantuah, reported by Awal Mohammed. The article has been re-published on other online news portals citing www.starfm.com as the source of the news story.
The Enterprise Group would like to state that the allegations made in the article are utterly false, baseless and lacking any truth or merit. The Group takes this opportunity to assert the following:
It is a listed company with over 3,000 local and foreign shareholders.
It has not acquired and has no interest in acquiring any shares in PDS.
The business of PDS is not in line with the Group’s focus, which is to remain and grow in the financial services sector.
The Enterprise Group has always demonstrated the highest standards of corporate governance and ethical conduct in its dealings, and it will continue to do so. The Company remains accessible to the media and urges all to make use of its well established channels to cross-check relevant information in the interest of responsible journalism.
Finally, the Group assures its clients, shareholders, staff and the nation at large that it remains committed to providing the best of insurance and other financial services to Ghanaians, and to fulfil its mission of providing all who come into contact with the Enterprise Group their desired ADVANTAGE.
The Republic of Ghana is expected to host the 3rd edition of the Africa Oil & Gas Local Content Sustainability Conference & Exhibition (ALC2019) scheduled from October 10-11, 2019, at the plush Mövenpick Ambassador Hotel in Accra, capital of the West Africa nation.
The two-day event, which is under the theme: ‘Shaping the Future through Sustainable Local Content Policies’, is expected to attract national, regional and international oil and gas industry Local Content Experts.
The first and second editions were hosted in Luanda, Angola.
A statement issued by the Ghana’s National Oil Company (GNPC), which is the local organiser and copied to energynewsafrica.com, explained that the choice of Ghana was informed by the various policies and actions of the Ghana Government & Industry, to encourage local content development and participation of citizens in the oil and gas value chain, since the country joined the ranks of African oil producers.
ALC 2019 will feature a technical exhibition alongside the main conference. And it will gather national, regional and international stakeholders from both public and private sectors, including government representatives, development partners, international and national oil companies, service providers and decision makers from the industry.
The event is a high-level policy dialogue and professional networking forum for key stakeholders in the African and international oil and gas industry, focusing on the sustainability of local content regulatory and institutional frameworks and policies that have, so far, been implemented by African Oil & Gas Producing Countries to enable and advance local economic development and national industry participation.“ALC2019 will promote knowledge exchange and showcase the best practical solutions for sustainable national industry participation and domestic value addition through local enterprise, contractor and supplier value chain development,” the statement said.
It would also explore opportunities for collaboration in regional local content for the development of regional supply chain within the oil and gas value chain in Africa.
ALC2019 is the third annual continent-wide policy response initiative and platform that brings together regional decision-makers and relevant stakeholders.
Below are speakers assembled for the programme.
John-Peter Amewu, Minister for Energy, Republic of Ghana.
The Global Commission to End Energy Poverty has been launched by the Rockefeller Foundation to provide access to electricity to about 840 million people with no access to affordable and reliable energy.
The Commission will be spearheaded by the Rockefeller Foundation, Africa Development Bank and the US Department of Energy.
Of the world’s 840 million energy-poor people (650 million in 2030 – World Bank), 90% live in sub-Saharan Africa.
The Commission comprises heads of development banks, utilities, off-grid companies, senior academics, industry leaders and investors.
The Global Commission to End Poverty will develop a roadmap to ensure access to electricity to the poor in a cost-effective manner.
The Commission’s plans are:
To work with utilities, investors and off-grid firms to fast-track sustainable power solutions over the next decade
To work with research firms to identify roadmaps in addressing the barriers to achieving universal electrification
President of the Rockefeller Foundation, Dr Rajiv J. Shah, said: “We cannot end poverty without ending energy poverty.
“Despite recent progress, the world is not on track to solve this problem by 2030. Now is the time to unleash the full potential of distributed energy by integrating the strengths of the grid and off-grid systems in order to enable large-scale public-private partnerships.”
African Development Bank President Akinwumi Adesina, added: “Close to 600 million people still don’t have access to electricity in Africa, and the majority live in rural areas.
“Grid expansion alone will not be enough to electrify these populations, but with a combination of distributed energy solutions and smart-grid expansion, we can achieve universal, economically impactful electrification.”
Robert Stoner, MIT Energy Initiative Deputy Director Robert Stoner noted that energy poverty is the end result of the failure of a complex system that spans physical infrastructure, advanced technologies, markets, policy, and regulation.
“Ending it requires finding generalisable solutions that make all parts of the electricity systems of low access countries reliable and affordable for everyone,” said Stoner.
For more information on the Global Commission to End Energy Poverty and its work, as well as a full list of commissioners, please visit endenergypoverty.org.
Saudi Aramco, a Saudi Arabian oil and gas giant, has said the company will return to full production capacity by the end of the month following a drone attack on the world’s largest oil processing facility last Saturday.
As previously reported, oil prices on Monday saw the biggest surge since 1991 following the attack on Saudi Aramco’s oil processing facilities Abqaiq and Khurais in Saudi Arabia.
The prices surged by as much as 19% in early trade on Monday before easing off to show a 10% gain after the U.S. President Trump said he would release the U.S. emergency supplies.
The attack resulted in the interruption of about 5.7 million barrels per day of crude oil production. Of these, 4.5 million barrels per day are from Abqaiq plants, where production is processed from several fields. The interruption of production also included about 2 billion cubic feet of associated gas, 1.3 billion cubic feet of dry gas, 500 million cubic feet of ethane and about half a million barrels of gas liquids.
On Tuesday, oil prices plunged by 6% after Saudi Arabia’s energy minister Prince Abdulaziz bin Salman told journalists at a press conference that the country had managed to restore oil supplies to customers to where they stood before the attacks by drawing from its huge inventories, according to Reuters.
The minister also said that the Kingdom’s production capacity would return to 11 million barrels per day by the end of September, and to 12 million barrels per day by the end of November.
Entire output restored by September-end
Saudi Aramco President & CEO Amin Nasser said on Tuesday that the company’s production capacity would be fully restored by the end of September.
Speaking to media in Jeddah during a news conference with Prince Abdulaziz Bin Salman, Minister of Energy, and Yasir Rumayyan, Chairman of Saudi Aramco, Nasser said: “These synchronized attacks were timed to create maximum damage to our facilities and operations. The rapid response and resilience demonstrated in the face of such adversity shows the company’s preparedness to deal with threats aimed at sabotaging Aramco’s supply of energy to the world.”
During the news conference, it was disclosed that production at Khurais resumed 24 hours after the attack. Meanwhile, Nasser stated that production at Abqaiq is currently 2 million barrels per day and its entire output is expected to be restored to prior rates by the end of September.
“We have a hard-earned reputation for nearly 100 percent reliability in terms of meeting our international customers’ requirements and we have defended that,” he told journalists from Saudi and international media as reported by offshoreenergytoday.com.
The company adjusted deliveries and shipments to customers by drawing on inventories and offering additional crude production from other fields.
“Not a single shipment to an international customer has been or will be missed or canceled as a result of these attacks. We have proven that we are operationally resilient and have confirmed our reputation as the world’s leading supplier,” Nasser said.
“The company has met its commitments to its International customers, even in challenging situations, including past Gulf conflicts.”
No delays to IPO
The subject of the company’s Initial Public Offering was also discussed during the news conference and Nasser had the following message: “We have said we are ready and will proceed with the IPO when our shareholder takes the decision.”
Saudi Aramco Chairman Rumayyan said in his statement during the press conference that the attacks “will not delay the initial public offering of Aramco and will not delay its preparations.”
“The planned IPO of the national oil giant will be ready in the next 12 months and the kingdom is committed to the listing,” he added.
Risk scenario becomes reality
Following what was described as the largest single disruption of oil production in history, IHS Markit, a London–based global information provider, developed three scenarios for the potential market impact of the Saudi oil attack.
In the first scenario, the Abqaiq plant flows prove to be entirely addressable within the next two weeks, with an initial restart early this week followed by a measured ramp-up thereafter. This would lead to a gross disruption in the 30-60 MMbbl range and should be manageable through any combination of Saudi stocks and global commercial inventories, with Saudi Arabia ostensibly surging post return to offset the net tightening caused by its temporary decline. This remains a low-likelihood scenario, with the extent of the attack suggesting at least some level of sustained damage affecting production levels.
The second scenario is, according to IHS Markit, the most likely. Saudi Arabia is able to manage a partial return from the peak disruption of 5.7 MMb/d but it is unable to address the full extent of the damage on key facilities for as long as four months. The gross disruption could increase into the 150-300 MMbbl range. This would exceed the ability of commercial inventories to meet the shortfall leading to higher prices. Global markets will likely look to extraordinary measures to mitigate the physical shortfall caused by the disruption, including a coordinated SPR stock release from the IEA, a potential call on China to ease market pressure through inventories, and call for increases in production from within the Vienna Alliance. On each of these fronts, the magnitude of the extended disruption becomes key given flow (for inventories) and capacity (for production) limitations.
The final scenario of 120+ days is the worst-case scenario, where output is out for months and the physical shortfall rises into the 350-500 MMbbl range. In this scenario, prices spike and extraordinary measures like SPR releases would be needed but would be insufficient and ultimately the market would require demand and eventually reactive supply such as the US (via higher prices) to correct for the structural imbalance in the market. Given the high priority of the facility to Aramco and the company’s prioritization of repairs regardless of cost, a stacked return means that it is unlikely that a full shutdown endures beyond 4 months unless damage is more extensive from the attacks than anticipated, or a large-scale conflict breaks out.
“What was a risk scenario has become a reality,” said Daniel Yergin, vice chairman, IHS Markit. “The amount of Saudi oil offline is equivalent to one third of what passes every day through the Strait of Hormuz. Two things will jangle the oil market in coming days—how long the recovery and what comes next.”
“Under any scenario, the heightened risk premium marks a stunning reversal for the market,” said Roger Diwan, vice president, IHS Markit.
“The combination of weak demand fed by macroeconomic fears and the potential for a U.S.-Iran détente unlocking significant volumes of oil currently under sanction had weighed on the market. Now an enduring increase in the market’s risk premium is justified.”
The Economist Intelligence Unit (EIU) has described attempts by the Akufo-Addo administration to renegotiate the power purchasing agreements signed under the previous administration as ‘radical’, arguing that the approach could scare aware potential investors.
The business advisory firm in its latest country report said a radical revision of power contracts i.e take or pay agreements, may not happen at all.
“All independent power projects typically include some level of “take or pay” commitment, while unilateral action by the state party risks damaging wider investor confidence in Ghana,” citinewsroom.com quoted EIU’s report saying.
It would be recalled that the Finance Minister of the West African nation, Ken Ofori-Atta in his mid-year budget review remarked that a number of existing power purchasing agreements signed by the NDC administration are severely putting a dent on government finances.
Ken Ofori-Atta said annually, the government has had to pay US$500 million for power in does not consume or sell to consumers.
“Mr. Ofori-Atta referred to the deals as “obnoxious take-or-pay contracts signed by the NDC government, which obligate us to pay for capacity we do not need”.
The finance minister pledged that from August 1st, all “take or pay” contracts would be renegotiated and converted into what he termed “take and pay” deals, presumably indicating a form of contract whereby the government would reimburse suppliers solely for the resource used.
Renegotiated agreements
Before Mr. Ofori-Atta’s announcement, the government had already concluded the renegotiation of the Ameri Energy deal in December.
The new deal saw the reduction of the price of a five-year build-own-operate-transfer contract expiring in 2021 to supply 250 MW of emergency power from US$510m to US$459m.
Also, in March 2018 the contract for the Karpower plant was extended from 10 to 20 years, and the tariff reduced.
But the EIU in its country report stated that the new Ameri and Karpower deals imply that government may not achieve much with its plans to renegotiate these deals.
“…However, the legacy of the “take or pay” contracts is expected to remain a burden on state finances throughout the 2019-23 forecast period,” the report added.
One hundred and eight engineers have been inducted into the Institution of Engineering Technology, a body of engineering professionals in the West African nation, Ghana.
The induction ceremony was officiated by His Lordship Justice George Koomson, a High Court judge.
The institution of engineering technology was established some thirty -three years ago by a group made up of various classes of engineering and technology professionals who were collectively bound by a commitment for more dividend in their professional and career development.
The institution has since then been preoccupied with the attainment of these, having metamorphosed from the then Ghana Institution of Technician Engineers into the Ghana Institution of Incorporated Engineers before assuming the name I E.T in 2008.
In an address, the President of I.E.T, Eng. Eric Atta-Sonno, who touted the progress of the institution said the inductees should see themselves as coming to join forces with others to ensure the continuous growth of the institution.
Eng. Atta -Sonno used the occasion to inform the inductees the inauguration of Board of the Engineering Council of Ghana.
He explained that the council is working hard to have the engineering regulations approved by the executive and passed into law as a legislative instrument.
“The LI would ensure that the Engineering Council Act 819 of 2011 is given the needed teeth to bite and ensure the practice of engineering and technology continue to do so with the highest possible standards in their professional practice of engineering and technology,” he said.
He charged the inductees to be of good conduct, assuring them that I.E.T would ensure that members adhere to the code of ethics of the professional.
“ALC2019 will promote knowledge exchange and showcase the best practical solutions for sustainable national industry participation and domestic value addition through local enterprise, contractor and supplier value chain development,” the statement said.
It would also explore opportunities for collaboration in regional local content for the development of regional supply chain within the oil and gas value chain in Africa.
ALC2019 is the third annual continent-wide policy response initiative and platform that brings together regional decision-makers and relevant stakeholders.
Below are speakers assembled for the programme.
