MID-TERM REPORTS BY THE HON. COMMISSIONER, MINISTRY OF OIL AND GAS, HON. OMAMOFE PIRAH
It is a pleasure to give an account of my Ministry’s stewardship to Deltans through this medium.
As you very well know, the institution of the press is a major pillar of modern democratic practice.
2. Let me first and foremost thank everyone of you present here today for finding time to attend this press briefing on the activities of my office since its creation in spite of your other engagements. I am quite sure that at the end of today’s informative and interactive session, everyone of us would be satisfied that the 3 – point Agenda of the Uduaghan Administration is no fluke but a reality that is on full course, with particular reference to Peace and Security to which my schedule falls into.
3. The Ministry of oil and gas was created in 2011. However, it is yet to have a full complement of staff and structures. Save for the two (2) mandatory Departments of Administration and Finance, and Planning, Research and Statistics, the professional departments are yet to be constituted. This poses severe limitation to the capacity of the newly created ministry to deliver on its assigned responsibilities.
4. The Ministry of oil and gas has responsibility for:-
(i) Liaising with the Federal Government Committee on Mineral Resources and Environment in connection with the development of Oil Mineral Resources in the state;
(ii) Promotion of oil and gas investments in the state;
(iii) Monitor the implementation of the Nigerian oil and gas industry Local Content Development Act in the state and implementation of corporate social responsibility by all companies in the oil and gas sector;
(iv) Act as representatives of the state to participate in biddings for oil blocks and other investment openings in the oil and gas industry;
(v) Liaison with the companies operating in the oil and gas producing areas of the state to ensure that they meet their Corporate Social Responsibilities (CSR) to the host communities (compliance assessment of MOU);
(vi) Liaise with relevant stakeholders and Interventionist Agencies for the overall development of the oil and gas sector of the state;
(vii) Initiate strategies that will promote good Community Relations among the oil and gas producing communities of the state;
(viii) Collaborate with the Ministry of Information to carry out enlightenment of oil and gas producing communities and other stakeholders on developments in the oil and gas industry;
(ix) Maintain a comprehensive list of Multi-national and Local oil and gas companies operating in the state;
(x) Relate with the Department of Petroleum Resources of the NNPC to ensure that records of oil production as it relates to Delta State are accurate;
(xi) Implement the independent conduct and verification of production, figures and data of oil and gas within the boundaries of the state; and
(xii) Any other matter that may be assigned by His Excellency, the Governor, from time to time.
5. In furtherance of the aforementioned responsibilities, the ministry has two (2) operational departments and three (3) units as follows:-
* Department of Administration and Finance;
* Department of Planning, Research and Statistics;
* Local Content Development Unit;
* Gas Unit;
* Oil Unit.
It has a total staff strength of 62.
6. In discharging its duties to Deltans since the commencement of this administration, the following programs/activities have been undertaken by the ministry:
7. CONFLICT RESOLUTION
In pursuance of the mandate to maintain peace and ensure harmony among stakeholders in the oil and gas sector, the ministry always hold mediation meetings in different parts of the state to resolve disputes between oil and gas companies and their host communities or intra-communal/inter-communal disputes over ownership and benefits of oil and gas resources. The primary objective of this effort is to create a peaceful atmosphere for sustained production and attract more investment to the oil and gas industry in the state.
For now, the ministry commits about 80% of its resources (time, fund and personnel) to this effort. From 1st January to 30th September, 2013, the ministry intervened in about 47 cases and successfully resolved 30 while many more are pending.
8. TOWN HALL MEETINGS IN HOST COMMUNITIES
As part of proactive measures to create a peaceful, friendly and conducive atmosphere for the smooth operations of the oil and gas industry in the state, the ministry organizes town hall meetings in various host communities in the state. The town hall meetings are targeted at the following specific objectives:-
(i) To sensitize host communities on the need to foster and maintain a harmonious relationship with the oil and gas companies operating in their domain for the mutual benefit of both parties and the country at large.
(ii) To sensitize host communities on the need to protect and preserve oil and gas installations/facilities in their localities.
(iii) To sensitize host communities on the need to eschew crude oil theft, illegal bunkering, pipeline vandalism and other allied crimes in the oil and gas industry.
(iv) To ascertain the socio-economic and environmental challenges facing host communities as a result of oil and gas exploration/exploitation activities in their areas.
(v) To identify any potential area of conflict between host communities and oil and gas companies operating in the areas with a view to articulating appropriate measures to nip it in the bud before it snowballs into major crisis.
(vi) To receive suggestions/recommendations on how to move the oil and gas industry in the state forward.
9. THE OGIDIGBEN EXPORT PROCESSING ZONE
It is pertinent to mention at this point progress being made at the Ogidigben Export processing zone which is an initiative of the Federal Government via NNPC in collaboration with the Delta State Government domiciled in Ogidigben in Warri South West Local Government Area , this project is a huge project that is worth 20 billion of dollars . The Ogidigben EPZ will consist of a gas hub, a petro chemical plant, methanol plant, fertilizer plant, a seaport, five star hotels banks and about 5000 housing unit. This will create employment and bring massive development to the region the State and the Country at large. As we speak bush clearing about to begin in 400 the hectares of land out of the total 2,800 hectares acquired for the entire project. We also have to some extent been able to bring all stakeholders in this project to round table discussion with the aim of soliciting their cooperation to ensure that the project thrives.
10. PARTNERSHIP WITH ENERGY EQUITY RESOURCE (EER)
The Delta State Government has developed a partnership with Energy Equity Resource through a Special purpose Vehicle (SPV), the Delta state Oil Company (DTSOC) through which it intends to embark on Oil and Gas Exploration activities. To this end, His Excellency, The Governor has approved the State Government participation in bid rounds to acquire acreages and marginal fields.
11. MONITORING OF CRUDE OIL & GAS PRODUCTION IN DELTA STATE
As stated earlier, one of the functions of the ministry is to implement an independent system for the monitoring and verification of crude oil and gas production outputs in the state.
The function is in realization of the fact that the state needs an organ of its own government dedicated to the verification, compilation and storage of production records so as to determine Revenues due it from the federation account, boost its employment levels and the economy in general. Ladies and gentlemen, steady efforts are being made to obtain requisite data on crude oil and gas production data in the state. This progress is however being retarded by the opposition of International Oil Companies (IOCs) to the ministry’s effort in this regard on the ground that oil and gas exploration/exploitation is under the Exclusive legislative list of the Federal Government l and therefore monitoring of production figures is a function of the department of Petroleum Resources (DPR).
In order to relieve the situation, the ministry has made feasible and appropriate recommendation to government. For now, the ministry’s monitoring effort is limited to indigenous oil and gas companies and marginal field operators.
12. CORPORATE SOCIAL RESPONSIBILITIES (CSR):
In pursuance of its assigned responsibility, the ministry embarks on monitoring visits to oil producing host and impacted communities to ascertain the level of responsiveness of oil and gas companies to their corporate social responsibilities in these communities. Sometimes, the visits are made to assess compliance with the terms of Memorandum of Understanding (MOU) brokered between the oil and gas companies and their host/impacted communities. The objective is to ensure that the oil and gas companies meet their social obligations to host/impacted communities in the following ways:-
(i) Provide critical infrastructures in the host/impacted communities to complement government efforts.
(ii) Contribute to human capital development in the state through their various skill acquisition programmes and scholarship schemes.
(iii) Provide employment opportunities especially to youths of host/impacted communities to reduce youth restiveness and other social vices.
(iv) Empower the indigenes of host/impacted communities by engaging them as ancillary service providers and contractors in less specialized areas. This will reduce rural poverty and engender sense of belonging.
(v) Contribute to the overall socio-economic development of the oil and gas producing areas of the state, and
(vi) Ultimately create peace and harmony in the oil producing areas of the state.
When the projects are completed and handed over to the communities, they are usually enjoined to own the project for purpose of sustainability. Gentlemen of the press, it must be stated that the effort of the ministry in this regard has yielded modest result as most of the oil and gas companies have now realized that there is a direct correlation between the degree of responsiveness to their corporate social responsibilities and the extent of cordial/harmonious relationship they receive from the host communities.
Examples of Corporate social responsibility projects executed by the oil and gas companies operating in the state since 2011 include:-
S/N PROJECTS LOCATION COMPANY
1. Skills Acquisition Centre Ugbuwangue Chevron Nig. Limited
2. Solar powered & manual boreholes Umusadege Midwestern Oil & Gas Co.
3. Ultra Modern Community Town Hall Umutu Platform Petroleum Ltd
4. Three one Bedroom Apartment for Umusam Health Centre Umusam Midwestern Oil& Gas Co.
5. Renovated Council Of Chiefs Hall Mosogar Seplat Petroleum Ltd
6. Renovated PHCN Office Mosogar Seplat Petroleum Ltd
13. EFFORTS MADE BY THE STATE GOVERNMENT TO CURB CRUDE OIL THEFT, PIPELINE VANDALISM AND ILLEGAL BUNKERING
It has been observed that recently, there has been increase in illegal bunkering, crude oil theft and pipeline vandalism etc in the state. The effects on the environment and the economy, which are enormous and devastating, are as follows:-
(i) Loss of substantial revenue by the state government.
(ii) Huge expenditure on the repairs/replacement and reconstruction of damaged facilities.
(iii) Loss of lives.
(iv) Occasional scarcity of products.
(v) Environmental pollution/hazards.
The Delta State government has taken some measures to curb the menaces of crude oil theft, pipeline vandalism and illegal bunkering in the state. They include:
(i) Provision of logistics support to security agencies in the state. The state government has been providing logistics support to the various security outfits in the state to curb the above stated crimes. Vehicles and boats have been provided to support the efforts of the Navy, Army, Police and the Joint Task Force (JTF) in this regard.
Presently, government is planning to rehabilitate boats that are in the state of disrepairs and buy new ones for the Navy and Army. The Navy, Army and JTF carry out surveillance and monitoring of oil and gas facilities and embark on raids and destruction of illegal oil and gas outfits as well as seizure of vessels used for crude oil trafficking.
A new group called “Quick Response Squad” was recently inaugurated for this purpose under the command of the 4th Brigade commander Benin City. In the 3 Battalion Army barracks, Warri, there is a monitoring team for protection of oil and gas facilities and another compact task force on “Anti-illegal Oil bunkering”. Tremendous successes have been recorded by these security agencies through destruction of many illegal refineries, seizure of illegal vessels and arrest of vandals.
(ii) Town hall meetings in host communities. The state government through my Ministry’s, has been holding several town hall meetings in various host communities in the state to sensitize them about government plan to deal with people involved in these activities.
(iii) Establishment of local vigilante outfits in host communities. Government has been encouraging host communities to set up vigilante outfits to keep surveillance over Oil and Gas facilities in their localities. This is yielding positive result as the Kokori-Samagidi vigilante group has proved very effective.
(iv) Waterway Security Committee: Few years ago, government established the Delta-Waterway Security Committee to curb various criminal activities including oil and gas crimes in its territorial waters. The outfit has also recorded tremendous success which includes lending support to the JTF.
In realization of the state government towards curbing crude oil theft and related crimes, the federal government appointed His Excellency, Dr. Emmanuel Uduaghan, (CON), Governor of Delta State as chairman, Security Strategy Committee to curb oil theft in the country. The effort of the committee has resulted in the restoration of three (3) major trunk lines to wit: Trans-Niger pipeline; Nembe-Creek pipeline and the Tebidaba – Brass pipeline which has increased production output with about 400,000 barrels per day.
The foregoing have been the major highlights of the ministry’s activities since inception in 2011. There are a number of other routine activities which need not been mentioned here. In general however, the thrust of the ministry’s function aims at providing strategic support to the State government to stimulate and improve the participation of Deltans in the oil and gas industry so as to assure the greatest benefits to our people within the limits of subsisting legal frame work. We are grateful to all government agencies for co-operating with us in this important task.
Thank you for listening.
MINISTRY OF OIL AND GAS