jpphilips:


I don't think it is in anyone's interest arguing in circles, I will put together a few questions where I feel we don't agree for clarification.

Is it impossible for Nigeria to exhaust her LOC's before devaluing the Naira? be succinct, I am still aware of some moves made by Russia before the Rubble went down.

All the oil blocks, production platforms, Marginal wells diverted, sold or on lease by madueke including the recently divested SPDC assets should be returned to NPDC with immediate effect.

* NPDC operatorship license Must be revoked; NPDC will enter a fresh operatorship agreement with a company that qualifies with a track record of managing oil and gas production facilities. Agreement should be one that gives room for NNPC/operator expansion of production output.

Since you don't know that senate places a benchmark on Nigerian export crude annually, I don't expect you to understand the need for
the re-basing. As far as im concerned, your understanding of the plan ends in phase 4.

I remembered I wrote "returned to NPDC" meaning that I acknowledged the aboriginal ownership by NPDC. here goes another question;

Can you brief us on the Pedigree of NECONDE to warrant operatorship of those assets. (since you implied NPDC was "overwhelmed" by the transfer, except you want to move from one inefficiency to another) Can you brief us further the experience of NECONDE where they have operated such assets to justify the transfer.

A DSO for gas in the PIB, how does it improve NGC?

You may wish to snap out of that unionism clap trap so you can answer the questions with a clear head.
Goodluck.

Technically, it is not possible to exhaust all LOCs before devaluing the naira. Most companies just go on with their transactions after careful study of the situation on ground especially the risk angle. Some companies just have production deadline or are time constrained. At most, they may reduce the value of the LOC to gauge against any unstable policy or prise instability but the government cannot just wait for these LOCs to be exhausted before devaluing the currency. Also, the CBN may have to consult with them on the effect of such an action. It is just that these oil imports were transactions on behalf and with the commitments and guaranty of the Federal Government. Else, like I said elsewhere, the exchange rate differentials will be inputted into the final sales price to recoup any loss.

The financial crisis of 1998 cost Pigman $500,000. A shipment of machinery he had sent to a gold mine under a letter of credit from Inkombank, then one of the largest commercial banks in Russia, went unpaid as the banking system crumbled and Inkombank vanished overnight.

Do you now agree that Okonjo Iweala attracting a liability of over 200b viz devaluation to the FG was an economic blunder

I had said earlier that you´re misinformed. Again, no oil asset has been diverted, sold or leased. And the operatorship of these divested assets by Shell to the successful consortia (NNPC initially transferred their rights to NPDC) have recently been re-transferred to a company that qualifies with a track record of managing oil and gas production facilities. - in your own words

Reacting to a story published by the Sun Newspaper about the protest of some leaders of ethnic nationalities from Delta State at the National Assembly over the allegation that the Mrs. Alison-Madueke “secretly transferred production rights in four large oil blocks (OMLs 26, 30, 34, and 42) to Atlantic Energy Drilling Concept Limited (Atlantic Energy) allegedly owned by one Mr. Jide Omokore without a bid”

According to the petition, if “an open and competitive bidding process mandated by Public Procurement Act had been followed, the market value of the OML 30 assets divested to Atlantic Energy should not be any less than $800 million.”

I still do not want to mix things up here. Re-basing in what aspect? Production quantity or price per barrel. The National Assembly together with the Executive Arm always place a benchmark on the price of crude oil and not quantity. NPDC´s topmost priority is to ensure consistent increase in oil production with
continuously reduced cost and improved income.

NECONDE is a consortium of 3 (4) companies:
1. Serinus Energy Corp. (formerly Kulcyzk Oil Ventures)
2. Gobowen E & P (a subsidiary of NestOil Group)
3. Aries Oil E & P (an affiliate of Yinka Folawiyo Petroleum)
4. VP Global Ltd - a special purpose vehicle formed by the host community and represents their interest where the asset is situated. I do not know in details their contribution to the partnership. I´m also
aware that their share of dividend accruing from this venture will go a long way in developing sustainable projects within the host community.

Serinus Energy is a Canadian international oil and gas exploration and production company with presence in 5 countries (Syria, Tunisia, Brunei, Ukraine and Romania) having 12 operated licenses (9 of which are 100% owned) in its asset portfolio. The promoter, Kulcyzk Investment is a well known international investment firm with interests in Oil and Gas, Minerals, Real Estate and Heavy Construction. Serinus Energy has dual listings - Warsaw Stock Exchange and Toronto Stock Exchange. This is a company with an international
exposure both in investment inflows and technical partnership.

Gobowen E & P, a subsdiary of NestOil (The largest EPCC in Nigeria) and currently owns a 45% participating interest in OML 88 and a 51%
participating interest in OPL 917. Gobowen is expected to leverage on the expertise of its holding company.

On Aries E & P, not much information could be obtained. However, going by the status of the holding company, the Yinka Folawiyo group, the
company should be in a better position to handle such projects. The Yinka Folawiyo group have been in the oil industry since 1991 and is known to have developed the Aje field, just some kilometers off the coast of Lagos, towards Benin.

All these companies put together, with their expertise, experiences and exposure are in a better position to operate the oil assets compared to the NPDC which is limited to the bureaucracies of NNPC and by extension, the Federal Government. Do you know of any bold move by NPDC outside the shores of Nigeria? Can you identify the business strategy of NPDC to fiercely compete both locally and internationally with her peers?

Until such a time that the NPDC will be run as a company, with clear cut goals and objectives, clear unambiguous strategy, they should be given less role to play. To some extent, I support Emefiele´s idea of government selling her equity stake in these oil JV and allow these companies to compete with their peers and not be spoon fed.

I don't know if you really want to make a point here or you want to bamboozle me, in the NECONDE consortium, Gobowen owns the highest stake, not surprising why Ernest Azudialo is the chairman of the group.
In business reality, he takes the final decision on the direction of the consortium, so the rest of the appendages are mere investors and has no strategic relevance, for the sake of this argument, I will single out Gobowen as our focal point; but before then, let me quickly remove a false impression that may obfuscate your audience.

Serinus energy did not invest in the NECONDE consortium, so I wonder what that company is doing there on your list. Manoj was the guy who invested and he is a passive director in Serinus, how does that prove he has oil and gas experience? what if he just brought money? what is his stake in Serinus? he is neither the chairman of the board nor the vice chairman, nor the COO, just a director, for all i care, his stakes may be either transferred or inherited, it doesn't prove that he has any oil and gas expertize. I implore you to remove Serinus energy from that list if you really want to be honest with yourself.

Back to Gobowen, are you aware that the first oil field Gobowen bought stakes in was the oriri marginal oil field (OML 88) in 2013, I could still remember when Chevron was operating it, the production was awesome, today, it has been relegated to a "marginal field" status, guess what; gobowen is not even there alone, he is operating alongside Goland on that "Marginal field".

Now let us go to your logic, a company that could not manage a "Marginal" asset alone, you gave 5 assets to operate? the same assets you claimed overwhelmed NPDC to a "sitting duck" status? NPDC that has a total production higher that Gobowen and NECONDE put together?
NPDC that has operated for over 28yrs compared to Gobowen's 2yrs in exploration? quit insulting my intelligence, I beg of you!!
Common sense would have told you that the political appendages of NECONDE painted NPDC incapacitated as a pretext to take over those assets, are you still in doubt whether or not the assets were diverted

On the issue of DSO (Domestic Supply Obligation) for gas and how it effects the operations of the NGC, firstly, I think that is a good policy
initiative needed to address majorly the worrisome power situation in the country. It is clearly known that gas production companies have a preference for a market that meets their interests. Cash and carry. Nobody (including you) wants to sell a product at ridiculous low price to a party who would tell stories. You just do not want disruption in
your operations due to cash flow constraints, mounting un-liquidated debts by debtors, inconsistent government policies bearing in mind
your huge financial investments into the business.

But a critical sector needs to be fixed. They economy has to be encouraged. The economy has to grow and develop. Consider power as a catalyst to drive economic growth, economic progress, economic development. How can we have power plants and yet no gas to supply? Before this policy was initiated, Gencos were not capable of paying for the price of gas supplied. So producers turned to the international market. Gencos not paying affected power supply. And we all know the effect. This same Alison you hate and other policy makers developed this framework to address the needs of power generation and also address the fears expressed by the gas producers who would rather patronize the lucrative international market.

Another usefulness of this policy is in meeting household energy needs - cooking. We just talked about kerosene. Over reliance of kerosene by the average Nigerian drives the demand for this product upwards and so will the cost soar. With an alternative, gas comes into play here. We just have abundance of it. So why allow the producers to export it and probably later importers import and sell at exorbitant prices as with PMS? Why not
encourage the use of this gas to meet other energy needs like pipeline fabrication, welding for our SMEs, bakery needs, large manufacturing
companies like Cadbury and Nestle for their power needs? Same with Dangote and the various steel companies.

Today focus is on agriculture. We have in fact all the factors of production including the raw materials. We need fertilisers. Hydrocarbon, which we have in abundance is a major component. Why not
encourage local producers to supply to local plants?

In summary, the DSO is one way of government´s incentives to encourage growth and development among different companies in various sectors of
the economy and by extension, the general improvements of every Nigerian; NGC is playing a leading role. NGC is (should be) well poised to take on this role. They have the largest market share, large clientele base, extensive assets which include well networked gas pipelines traversing long distances to most companies, power plants and cities. In fact, this policy is positively skewed to the NGC and they must maximise the opportunities.

I must be lost what this sermon is about, the question I asked was simple, how does the DSO model encourage the growth of NGC
Mention one country in the world with proven gas reserves like Nigeria, practising the DSO model?
concise and succinct please!!

kaboninc:
Jjphillips

Am waiting for ya here.

Cheers.

jpphilips:


It took you long to respond and the thread didn't make front page hence little or no contributions, kinda lost interest

jpphilips:

In 1998, Russia devalued the ruble, a move necessitated by a global fall in crude prices (you wont say it is apple vs oranges right?), some measures were taken and one of it was, govt banks stopped issuing LOC's for importers, it is routed through private banks who bear the brunt of its Liability solely, here is an excerpt from an article at the time.

Its all in the news bro; this is an excerpt from one of numerous petitions against her on those acquisitions you are eulogizing

Last week, you had no idea what I meant by the rebasing neither did you know that the senate pegs a benchmark for export crude revenue annually, why do you want to discuss what you dont know? I thought you should go back to the original post and sink in what I wrote, understand the strategy, then make input based on the strategy. The purple phrase was is the only thing that had a bearing with what is discussed, the rest are inconsequential to the subject of discourse. I won't allow myself in that circular misconception again.

I don't know if you really want to make a point here or you want to bamboozle me, in the NECONDE consortium, Gobowen owns the highest stake, not surprising why Ernest Azudialo is the chairman of the group. In business reality, he takes the final decision on the direction of the consortium, so the rest of the appendages are mere investors and has no strategic relevance, for the sake of this argument, I will single out Gobowen as our focal point; but before then, let me quickly remove a false impression that may obfuscate your audience.
Serinus energy did not invest in the NECONDE
consortium, so I wonder what that company is doing there on your list. Manoj was the guy who invested and he is a passive director in Serinus, how does that prove he has oil and gas experience? what if he just brought money? what is his stake in Serinus? he is neither the chairman of the board nor the vice chairman, nor the COO, just a director, for all i care, his stakes may be either transferred or inherited, it doesn't prove that he has any oil and gas expertize. I implore you to remove Serinus energy from that list if you really want to be honest with yourself.
Back to Gobowen, are you aware that the first oil field Gobowen bought stakes in was the oriri
marginal oil field (OML 88) in 2013, I could still remember when Chevron was operating it, the production was awesome, today, it has been
relegated to a "marginal field" status, guess what; gobowen is not even there alone, he is operating alongside Goland on that "Marginal field".
Now let us go to your logic, a company that could not manage a "Marginal" asset alone, you gave 5 assets to operate? the same assets you claimed overwhelmed NPDC to a "sitting duck" status? NPDC that has a total production higher that Gobowen and NECONDE put together? NPDC that has operated for over 28yrs compared to Gobowen's 2yrs in exploration? quit insulting my intelligence, I beg of you!! Common sense would have told you that the political appendages of NECONDE painted NPDC incapacitated as a pretext to take over those assets, are you still in doubt whether or not the assets were diverted[
/quote]

You amaze me, I tell you.

Let me correct you and I challenge you to do the same. Kulcyzk Investment owns 40% in the Neconde Consortium. Here:
[quote]Neconde Energy Limited
A consortium that acquired a 45% stake in a production license OML 42 in the Niger Delta from Shell , one of the world’s largest hydrocarbon reservoirs. Participation in Neconde gives Kulczyk Investments access to very attractive production assets in Africa.
Date of investment: 2011
Shareholding: 40%

Tim Elliott, President and Chief Executive Officer of KOV stated that:
"This transaction provides KOV with an opportunity to participate in a world-class project."
On 6 May 2011 the Company announced that it had joined the Neconde consortium as a 20% shareholder and that Neconde had entered into various agreements on 29 April 2011 with Shell Petroleum Development Company of Nigeria Ltd, Total E&P Nigeria Limited and Nigerian Agip Oil Company Limited (together, the "Sellers", to acquire (the "Transaction", the Sellers' cumulative 45% participating interest in Oil Mining License 42 (" OML 42".

Kulczyk Oil Ventures To Acquire Winstar Resources
CALGARY, ALBERTA--(Marketwired - April 25, 2013) - Kulczyk Oil Ventures Inc. (WARSAW:KOV)
("KOV", an international upstream oil and gas exploration and production company, is pleased to announce that it has entered into an agreement (the " Arrangement Agreement" with Winstar Resources Ltd. ("Winstar" pursuant to which KOV will acquire all of the issued and outstanding shares of Winstar (the " Acquisition".

As a condition of the Acquisition, KOV will apply to list its shares on the Toronto Stock Exchange (" TSX", undertake a 10:1 share consolidation and be renamed Serinus Energy Inc.

Jan Kulczyk (born 24 June 1950) is a Polish businessman. He is the founder and owner of Kulczyk Holding (headquartered in Warsaw) and international investment house Kulczyk Investments (former name: Kulczyk Investment House) with headquarters in Luxembourg and offices in London, Kiev and Dubai.[quote]

So in matters involving Serinus Energy, Kulczyk Investment - and not Mr Manoj - should be given priority. Being a director doesn't make you a shareholder of a company. Mr. Manoj is representing an interest in the consortium - which is Kulczyk Investment.

Then again, Mr. Ernest may be the chairman but that doesn't make him the majority shareholder. I've shown here the shareholding of one partner of the Neconde consortium. Why don't you show me (or us) where NestOil (Gobowen) controls the majority shareholding of Neconde including his percentage holding?

To buttress my point about the experience of Kulczyk and their wanting to operate the asset, here's a quote concerning this transaction:
[quote]KOV deputy CEO Jakub Korczak:

"In the course of negotiations it turned out that Neconde will not become the license operator. It means we would have to act more as a financial investor, which is contrary to firm's strategy. We would prefer to leverage our experience, competence and technical knowledge on particular projects."

Marginal fields are essentially undeveloped discoveries, located in acreages held by majors, who consider them rather uneconomic to bring into production.

In compelling the majors to farm out the fields to Nigerian companies, the Nigerian government hoped to boost the percentage of total National production that is operated by homegrown companies. Ideally, it’s a form of capacity building.

I must be lost what this sermon is about, the question I asked was simple, how does the DSO model encourage the growth of NGC Mention one country in the world with proven gas reserves like Nigeria, practising the DSO model? concise and succinct please!!

Firstly, government banks do not issue LOCs to our local importers. The private banks do and that was why the importers insisted on being paid before taking any orders. So your attempt here proves nothing at best. Secondly, NOI [b]did not sanction or approve or ordered the devaluation of the naira. The CBN did with the authority of the President.[/b] That is the exclusive duty of the CBN which is primarily managing the local tender. Thirdly, you may have to consider the Russian economy at that time - did she have working refineries or the Russian Government was subsidizing PMS and kerosene at that time? Did they have a well spread network of pipelines - which are not attractive to vandals - to ensure speedy, reliable and efficient distribution of petroleum products or the primary means of transport was tankers whose drivers can just decide to go on strike? What's the oil (PMS, AGO DPK, Jet A1 fuel) imports bill? What's the country's balance of trade with respect to oil imports and how does it affect the economy? These are questions you should ask before comparing with ours.

I have corrected you on this issue of asset diversion. The object here is the asset and in that context, none has been sold, leased or diverted. What we should be concerned here is the status of participating interests because the assets are still been owned by the JV.

On the Atlantic Energy issue, if you can believe what you actually posted especially the 59 trillion naira shady deal, then I'll give you an island just in the middle of the Pacific - free. I believe we should have passed the stage of sensational cries or allegations. Your relying on the strength of an allegation...bro you're bigger than that. NPDC did not transfer or divert or sold or leased out to anyone, anybody or group of persons any of the OMLs assigned to them by NNPC. They did enter into a Strategic Alliance Agreement with Atlantic Energy and I think they got their fingers burned. Some heads did roll - the Managing Director was replaced and same with the Group ED, Exploration for NNPC. That was one of the reasons the other JV partners had to cry out that they should have been contacted before any third party agreement. Get your facts right.

You insult my intelligence by saying I had no idea of what the senate sets or not. Let me correct you: the Senate does not set any benchmark for export crude revenue but the National Assembly together with the Executive Arm sets a benchmark on the price of crude oil. These two items - export crude revenue and export crude price are different entirely in the Nigeria context - development of a budget outlining expenditures and expected revenue generation. I've always said you should be clear and unambiguous in your usage and choice of words.

"The Nigerian JV structure is not subject to any Senate approval/vetting. Maybe from the President through the Minister, I can’t say. But I do know that the NNPC offsets its obligations after sales and that has been the major bone of contention between the NNPC and the government. Even the PwC report commented on this".

Secondly, I'll ask again: explain what you mean by 're-basing' as per how it affects NPDC.

baralatie:
I take it that you guys are still figuring out a solution to subsidy and yet come to a solution!

jpphilips:


The solution is already there, probably analysing its workability should be the focal point here.

You amaze me, I tell you.

Let me correct you and I challenge you to do the same. Kulcyzk Investment owns 40% in the Neconde Consortium. Here:
[quote]Neconde Energy Limited
A consortium that acquired a 45% stake in a production license OML 42 in the Niger Delta from Shell , one of the world’s largest hydrocarbon reservoirs. Participation in Neconde gives Kulczyk Investments access to very attractive production assets in Africa.
Date of investment: 2011
Shareholding: 40%

Mind you, this investment started since 2011. Here:
Tim Elliott, President and Chief Executive Officer of KOV stated that:
"This transaction provides KOV with an opportunity to participate in a world-class project."
On 6 May 2011 the Company announced that it had joined the Neconde consortium as a 20% shareholder and that Neconde had entered into various agreements on 29 April 2011 with Shell Petroleum Development Company of Nigeria Ltd, Total E&P Nigeria Limited and Nigerian Agip Oil Company Limited (together, the "Sellers"wink, to acquire (the "Transaction"wink, the Sellers' cumulative 45% participating interest in Oil Mining License 42 (" OML 42"wink.

Link: www.m.marketwired.com/press-release/kulczyk-oil-ventures-inc-nigeria-oml-42-purchase-completed-by-neconde-warsaw-kov-1593390.htm

As per the connection with Serinus Energy, Kulczyk Oil Ventures (through Kulczyk Investments) acquired the Canadian Winstar Resources and then changed the name to Serinus Energy.
Kulczyk Oil Ventures To Acquire Winstar Resources
CALGARY, ALBERTA--(Marketwired - April 25, 2013) - Kulczyk Oil Ventures Inc. (WARSAW:KOV)
("KOV"wink, an international upstream oil and gas exploration and production company, is pleased to announce that it has entered into an agreement (the " Arrangement Agreement"wink with Winstar Resources Ltd. ("Winstar"wink pursuant to which KOV will acquire all of the issued and outstanding shares of Winstar (the " Acquisition"wink.

As a condition of the Acquisition, KOV will apply to list its shares on the Toronto Stock Exchange (" TSX"wink, undertake a 10:1 share consolidation and be renamed Serinus Energy Inc.

So you should agree when I mentioned Serinus Energy as a member of the consortium.

Mr. Manoj Madnani is only but the Managing Director of Kulczyk Investment. He's an employee bro. The guy who calls the shots is Jan Kulczyk and his shots extends to every investment interest/decision undertaken by Kulczyk Investment S.A which includes Neconde Energy.

Jan Kulczyk (born 24 June 1950) is a Polish businessman. He is the founder and owner of Kulczyk Holding (headquartered in Warsaw) and international investment house Kulczyk Investments (former name: Kulczyk Investment House) with headquarters in Luxembourg and offices in London, Kiev and Dubai.[quote]

So in matters involving Serinus Energy, Kulczyk Investment - and not Mr Manoj - should be given priority. Being a director doesn't make you a shareholder of a company. Mr. Manoj is representing an interest in the consortium - which is Kulczyk Investment.

Then again, Mr. Ernest may be the chairman but that doesn't make him the majority shareholder. I've shown here the shareholding of one partner of the Neconde consortium. Why don't you show me (or us) where NestOil (Gobowen) controls the majority shareholding of Neconde including his percentage holding?

To buttress my point about the experience of Kulczyk and their wanting to operate the asset, here's a quote concerning this transaction:
[quote]KOV deputy CEO Jakub Korczak:

"In the course of negotiations it turned out that Neconde will not become the license operator. It means we would have to act more as a financial investor, which is contrary to firm's strategy. We would prefer to leverage our experience, competence and technical knowledge on particular projects."

Link: www.gpwinfostrefa.pl/GPWIS2/en/news/info/230713,highlights:_kov_and_kulczyk_investments_officials_on_kov_s_resignation_from_neconde_deal._aim_flotat

OML 88 is actually owned by Chevron with license renewed earlier this year for an extra 20 years. However, within this acreage is housed the Oriri Marginal Field which has now being acquired (45% participating interest) by Gobowen (of NestOil). So giving the impression that Gobowen owns the 45% of the entire OML 88 is false and misleading especially when you allude that Chevron has been producing from it.

Marginal fields are essentially undeveloped discoveries, located in acreages held by majors, who consider them rather uneconomic to bring into production.

In compelling the majors to farm out the fields to Nigerian companies, the Nigerian government hoped to boost the percentage of total National production that is operated by homegrown companies. Ideally, it’s a form of capacity building.

Link: africaoilgasreport.com/2013/02/in-the-news/nigeria-the-marginal-field-experiment-at-10/

Neconde is not operating "five" assets as you claimed here: a company that could not manage a "Marginal" asset alone, you gave 5
assets to operate? - but one

""Can you brief us on the Pedigree of NECONDE to warrant operatorship of those assets.
(since you implied NPDC was "overwhelmed" by the transfer, except you want to move from one inefficiency to another)
Can you brief us further the experience of NECONDE where they have operated such assets to justify the transfer"".

NGC was primarily set up to harness the opportunities in the gas industry. In early exploration activities, gas was mostly flared as the exploration companies do not see a developed, or developing gas market. The necessary policies and infrastructures were just not there. The investment opportunities were just not clear enough

NGC's model is a distribution model - they take gas from the producers and supply to clients. Due to the nature of their business - supplying gas to local companies - they've invested so much in distribution systems (network of gas pipelines) as with other distribution companies.

DSO is designed in preference to the Nigerian local companies. Specific gas quantity must be distributed (or sold) locally before exported. Also, the demand for gas in Nigeria is steadily increasing. We can see how this is to the benefit of NGC. They have the largest network of gas pipelines and even clientele base, large (if not largest) market share.

Lastly you need to know that policies are developed to achieve a specific purpose. The DSO policy, at the time it was developed was act as a catalyst for speedy development of our power sector and the Nigerian economy at large. The sermon is up there. As per other countries, we have different needs. Why would a country encourage export of crude oil and allow imports of refined crude when they can encourage the construction of refineries within the country? Just Nigerians!

jpphilips:

Your penchant for long stories derail your response, I told you what Russia did to transfer the Liability of devaluation from the Govt to private banks, why are you telling me about NOI? why are you telling me that Nigerian banks issue LOC's am I talking about Nigeria?
You are asking of Russia's refining capacity while the example I gave was imported machinery, what has pipelines go to do with the subject? I dont want to believe you have comprehension problems but you simply don't want to read, if I take my time to read all these you write, why not you? Learn to summarize your post and limit your introduction of irrelevant subjects.
For you to think that the CBN can devalue the currency without a nod from the Finance and coordinating minister of economy is laughable.

The bone of contention is that the coordinating minister of economy (CBN inclusive) devalued the currency and the FG incurred a liability of over 200b, in my expose I called it an avoidable inefficiency and you tried to disprove it, please stay on track.
The Russians were in the same situation and their Govt at the time found a way to transfer the Liability from Govt Banks to private banks, the onus is on you to prove that it did not work for the Russians.

You completely derailed from the subject matter as such, you have to revisit it again!!

This is the English meaning of diversion; 2. change of purpose: a change in the purpose or use of something from what was intended or from what it was previously
Microsoft® Encarta® 2009. © 1993-2008 Microsoft Corporation. All rights reserved.


From the example I gave you, did the petroleum minister divert those oil blocks, yes or NO?, in case you did not read the example, here I will reproduce it below and I will not be generous next time;


""Reacting to a story published by the Sun Newspaper about the protest of some leaders of ethnic nationalities from Delta State at the National Assembly over the allegation that the Mrs. Alison-Madueke “secretly transferred production rights in four large oil blocks (OMLs 26, 30, 34, and 42) to Atlantic Energy Drilling Concept Limited (Atlantic Energy) allegedly owned by one Mr. Jide Omokore without a bid”

According to the petition, if “an open and competitive bidding process mandated by Public Procurement Act had been followed, the market value of the OML 30 assets divested to Atlantic Energy should not be any less than $800 million.”
http://www.premiumtimesng.com/news/132171-group-asks-efcc-to-investigate-alison-madueke-over-oil-block-deals.html
""

Tell us in your infinite wisdom, is the above a diversion or not??

You claimed there was no diversion, yet you admitted people were sanctioned, in your words, "heads did roll". Arent you talking from the two compasses of your mouth? If there was no diversion, what rolled the heads?

Again you confused what needs to be rebased; quantity with pricing, when I told you categorically that the rebased NPDC oil will give birth to oil sold below the international crude price and will be immune to international crude price fluctuations.
I thought the problem we have here is not only that you hardly read what i write, you equally do not read what you write, hence, I will put the rebasing part on hold pending when a discerning mind that pays attention to details join the conversation, that way no intelligence will be insulted right??

We may likely discuss that when I am convinced you have started paying attention, I dont have the energy to be going in circles, how a yes or no question, ends up in paragraphs of irrelevant materials is mind boggling, read, understand and respond isn't that difficult.

baralatie:

a solution should also mean it is 'workable' unless another factor contributing to failure in the oil sector is been overlooked.

jpphilips:
@ Kabonic

jpphilips:
@ Kabonic
Do you even read? I asked you to remove Serinus energy from your list that Serinus did not invest in NECONDE, I told you that I will do my analysis based on the highest holder reason I focused on Gobowen, now you are talking about Kulcyzk, is Kulcysk the bone of contention?
cant you read??

This is what I could make out from your sermon;

You lack the ability to identify subjects in dispute
You lack the ability to identify subjects in agreement.
You seem not to realize that a simple question behoove a simple answer not a sermon.
You have completely lost focus on the subject of contention, as a reminder see below and please respond to it like you understand it even if you dont;

This is not what DSO specifies, for the sake of argument, where will "specific gas quantity" come from? DSO is enshrined in your current PIB, from your response above and all the irrelevant materials therein, I am convinced beyond doubt that you have no idea how DSO will destroy our gas production capacity and its distribution subset NGC, I will have to implore you to relax here and wait till someone who has an idea joins the conversation.

Like I said earlier, discussing a plan you dont understand will do us no good, thank you for your time at least you understood to phase 4.

baralatie:

a solution should also mean it is 'workable' unless another factor contributing to failure in the oil sector is been overlooked.

You just hate to take corrections. You brought the issue of transferring the liabilities of LOC from a government owned bank to a private owned bank. Then you gave an instance of a 'machinery' in your post. I had to correct you that you do not compare the activities in one industry with another industry. Is that how you argue? Because the Russian government stopped government owned banks from granting LOCs for 'machineries' compared to 'crude oil derivatives' which are much more unstable than most commodities? What kind of reasoning is that? So when people who are not informed read you would think you're making a point.

I talked about the refining capacity to buttress my point on focusing our attention on OIL and not 'gold machinery' as illustrated in your example. It is you who have serious comprehension issues and to tell you the truth, you seem ignorant. This is elementary economics. The Ministry of Finance manages the fiscal component and the CBN manages the monetary component of the economy. NOI as the Coordinating Minister did not devalue the naira. The other way round - CBN with the consent of the President and not the Minister. Where have you seen a Minister devaluing the local currency in the entire world?

You talk of me writing long epistle but the little you put down here are vague and flawed both in content and reasoning. I don't glance through your post, I read them and any unbiased mind will notice the many flaws in your stories. Stop talking about the Russian government's transfer because these are two different scenarios. Gold machinery and subsidized oil imports. Did the Nigerian government pay for other imports affected by the devalued naira? Stop your ignorance. It is not becoming funny.

I had earlier told you that the oil marketers import on behalf of the government and so liabilities like these will be borne by the government. Else (if there is no subsidy) the marketers will input the exchange rate differential cost into their selling price thereby passing it unto the consumers. Did you close your eyes to this? Did you skip it when reading? Don't make me feel my efforts here are just in vain.

With someone of your caliber, giving credibility to an allegation of that nature is terrible. Look at the content of what you quoted: secretly transferred production right and you expect me to give a reply on that? I can't. I don't do hear-say talks or bear palour gossips.

Again, the Minister did not, nor did the NPDC divert any oil block neither were the crude oil produced from the block. Stop being difficult. If it was diverted as you have been claiming, to who? You or Atlantic Energy? This is the last time I will comment on your diversion claim. If you want to go on with your claim, continue.

Let me help you bro. Asset, in this context (the entire OIL BLOCK) is different from the oil being produced. So one wonders if what you mean by 'asset diversion' as if the entire OIL BLOCK has been DIVERTED! Head rolled not because the OIL BLOCK nor crude oil was diverted but there were some irregularities in the agreement and operations between Atlantic Energy and NPDC. You write differently from what you think.

Interesting!

I wonder who will be willing to sell your 'rebased' oil at a price below the market price. And I wonder how a product of this nature will be immune to price fluctuations. I also doubt your intelligence on market forces and their effect. Else, you wouldn't be making such blunders up there.

That state when we think you know, we actually know nothing. I thought you'd say something about the Neconde Consortium. Or you forgot it? Civil individuals admit when they've made mistakes. You, you never do.

Or did you also forget the DSO model and NGC?

I just don't get paid for explaining things to you.

kaboninc:


His solutions are filled with flaws and false claims. So that is a turn off.

jpphilips:

Here again, you are interested in writing sermons then miss the point, you said the LOC's liability is unavoidable and I gave you an example with Russia how they avoided it, is that what you cannot understand? did you even read the link to that story?
Currency was devalued due to fall in crude prices, it was the same challenge Nigeria had, it is not industry specific, read properly before responding, you rushed to absolve your failed minister forgetting that the subject of contention has shifted to Russia's ability to succeed where NOI failed. damn!! you

Nobody asked you that, it is irrelevant and obfuscating, learn to stick to what you are asked to give your discussion a sense of direction. we are not here to write essays.

Finally, he has made a point; the importers bore the brunt of the devaluation in other commodities and your infinite wisdom tells you that the government is helpless for a commodity she is subsidizing brilliant!!
When Chukwuma Soludo (Economic co ordinator and CBN governor)devalued the naira towards the end of the global economic melt down, how much did Nigeria pay as exchange rate differentials?

Was Nigeria not importing products during OBJ's tenure? was Nigeria not paying subsidy then? did nigeria not devalue currency then?
What magic absorbed the exchange rate differential in that era, that failed this era?

The matter is in court, let the court decide for us whether or not there was a diversion and whether due process was followed, happy now?? Yes! because you pay attention to semantics, we know what was diverted, heads rolled because of that (according to you), however you want to paint it, whichever terminology you choose to employ, is immaterial.
People went to court and termed that act "illegal transfer", I called it "diversion", you admitted that "head rolled" because of it, so what is the bone of contention?

While doubting my intelligence, be patient enough till someone who understands that phase 4 and 5 was the grand model of Libya's pre gaddafi era, joins the conversation, like i said, what you don't understand is not impossible.

You need help bro. Serious mental help.

You asked for the composition of Neconde, and I just gave you and here you say am wrong without disproving me? That's mean sir. People like you don't argue to learn. Are you the type who talk without facts? I challenged you to show a proof that Gobowen is the majority shareholder and you wave that aside? No wonder Netose and the other guys just can't keep up with you.

Gobowen owns the highest stake, not surprising why Ernest Azudialo is the chairman of the group.

He who knows not, and knows that he knows not......

You talk about the pedigree of Neconde, I gave you. I mentioned Serinus Energy and gave you reasons why I did so. You don't seem confortable because I did not elaborate on Gobowen as that was your target when in fact, Serinus Energy (Kulczyks interests) were the technical partners? Oh, did you miss your false claims on Mr. Manoj? I see.

Why don't you tell us what DSO specifies sir? Tell us how DSO will destroy our gas production capacity and "its distribution subset NGC" (as if NGC is the only gas distribution subset). Explain to us here what it specifies. Then I can talk about where my "specific gas quantity" will come from. Nice discussing with you sir.

baralatie:

it is actually a big load of fun on this thread!
@jpphillips solutions and your are two completely different views to the same problems.(I hope I understand)
summaratively there are two approaches on this thread
1.SANITIZATION:here the solutions preferred is looking directly at the errors hidden in the system and the practices that hinders the workability of the Nigerian oil sector.
2.SUSTAINABILITY:here is where one is looking at what policies should be introduced which is sustainable both to govt,private,consumer and economy.

if you go through @jpphillips comments you be able to understand where he is coming from and make or met at some point.

kaboninc:


My problem with jpphilips' post is that the claims there are false and flawed. So if in the first place the claims are not true and having been able to show that they are indeed not true, all his solutions become a nullity.

In the course of outlining how faulty his claims have been, I also advanced my own solutions. I expected him to look at mine and make his observations. Rather he attacks my points disproving his and brings into discussion, ideas he can't even defend.

In summary, he wants a gradual removal of subsidy. I support a complete removal of subsidy immediately going by experiences. Two, he talks about NPDC and their activities. His claims, especially allegations he not only can't prove, he can't even sustain, I have shown that they are wrong. He brings on the capabilities of Neconde. I went as far as bringing to fore the shareholding structure which he knows little about. Then the LOCs which I initially cleared in my first post. Then the devaluation of the naira and exchange rate differentials. Then talked about the DSO and the NGC model? Haba.....we are not kids on a roller coaster ride here.

He wants the refineries be worked on and I said they should be sold out rightly.

So we disagree on everything bro.

The links brought here to buttress a point are allegations and Russian devaluation on a 'gold machinery' which is not even subsidized?

You don't argue like that bro.

jpphilips:

You see? Nobody asked you the composition of NECONDE, I asked you of their capabilities to justify the acquisition, now, who needs mental help? You asked me to prove that Gobowen is the highest share holder in NECONDE? even though you did not ask directly, I remembered telling you this

If the statement above made any sense to you, or perhaps you read it, you will not repeat a question that has already been answered.

in the interest of the audience who may bother to read, here is an excerpt from the Gobowen website;

"Gobowen holds a major stake in the Neconde Energy Limited consortium which acquired the 45% equity in the Oil Mining Licence 42 (OML 42) in April, 2011. OML 42 contains 12 developed oil fields located in the swamps in the Niger Delta Area of Nigeria. Full production from the block is estimated at 100,000 – 150,000 barrels per day."
http://nestoil-ltd.com/about-us/strategic-business-units/gobowen.html

Are you still in doubt if Gobowen has the highest stake in the NECONDE consortium? You see how I answered a simple question devoid of sermon, learn from it.

Did Serinus Energy invest in NECONDE yes or NO?

I will deal with that later, when i am convinced you can now read what you write to avoid going in circles.

baralatie:

at least you understanding d
@jphillips line of argument is solely SANITIZATION of the oil and gas thereby bringing down assumed cost(theoretically) BUT.....
on SUSTAINABLE solutions .........hmmmmmmm
the thread is still ongoing!