OIL prices climbed slightly on Tuesday, nearing 74 dollars in London, as OPEC stuck to its forecast of a rebound for energy demand next year.
Meanwhile, the Nigerian Extractive Industries Transparency Initiative has said billions of naira is lost in the nationâ€™s oil and gas industry due to lack of transparency and poor monitoring of oil and gas production in the country.
Brent North Sea crude for delivery in September rose 11 cents to 73.61 dollars a barrel in London long before the close. New Yorkâ€™s main contract, light sweet crude for September, gained 12 cents to 70.72 dollars a barrel.
World oil demand will decline slightly in 2009 but start growing again next year, the OPEC oil producersâ€™ cartel said on Tuesday in its monthly report, standing by its previous forecast.
â€œThe forecast for world oil demand growth in 2009 remains unchanged, showing a decline of 1.6 million barrels per day (bpd),â€ or 1.93 percent to 83.91 million bpd, the Organization of Petroleum Exporting Countries said.
In 2010, the trend was expected to reverse, with demand growing by 0.5 million bpd, or 0.59 per cent, as already predicted in OPECâ€™s July report.
â€œUpbeat sentiment and hopes of a forthcoming economic recovery continue to underpin the market (oil prices) despite fairly sluggish fundamentals (of supply and demand),â€ Andrey Kryuchenkov, commodities analyst at VTB Capital, said on Tuesday.
Oil prices rose to historic high points of more than 147 dollars a barrel in July last year. But they went on to plummet to near 30 dollars in December after a financial and economic crisis in the United States escalated to affect other economies around the world and hit oil demand.
Prices have since clawed back, driven in part by hopes of an early rebound for the global economy. But while there are signs that the global recession is abating, energy demand has remained soft, analysts said.
NEITI indicts oil operators over lack of transparency:
The Chairman of the National Stakeholders Working Group of NEITI, Professor Assisi Asobie, who disclosed this on Tuesday in an interview with our correspondent, further noted that lack of accountability in the industry was at the root of the crises in the Niger Delta.
Asobie, who spoke at Oil and Gas Production Accounting Workshop organized by the Department of Petroleum Resources (DPR) and the Norwegian Petroleum Directorate (NPD), said poor accounting and measurement of oil and gas production was a major challenge to the intiative.
He said, â€œWe have been having problems with knowing exactly how much is produced, so we have commissioned a consultant to help us know the international best practices with regards to production accounting.
â€œIt is so important because if you do not determine how much is lost, those companies that are producing benefit, and Nigeria is cheated. It is in the interest of producers that the status quo is maintained and that the nation never knows how much is lost and who is stealing the product.
â€œYou know wherever, there is anarchy, some people take advantage of the situation, and the way Nigeriaâ€™s oil and gas industry is structured today has given so much room for stealing and corruption to go on.
According to him, there is need, therefore, to use the latest electronic technology that can detect where these pipelines are sabotaged, and then capture the images, so that the perpetrators can be apprehended and made to face the wrath of the law.
He said, â€œOftentimes, the DPR has complained to us that they cannot do it (effective monitoring and measurement) that is why we got someone from abroad to help us identify these technologies that use sonic systems and then use cameras to capture those behind the theft.
â€œWe know that there are bigger personalities behind all these pipeline sabotage than the so called militants, so it is important that we begin to do things differently to ensure that a few people do not benefit from the wealth that belongs to everyone.â€
He added, â€œWhat we do in NEITI is to find out how much oil and gas are being produced in Nigeria , and therefore how much royalty and taxes also accrue to the country.
â€œPart of our responsibility is also to find out the deficiencies in the regulatory agencies like the DPR, and help to remedy those deficiencies; we want to know what challenges they face in determining how much oil is produced and exported from the country.â€
On the issue of militancy in the Niger Delta region, Asobie, who is a professor of Political Science, averred that a faulty Federal system and lack of development at the rural level was to blame for the rise in militancy.
He said, â€œFirst of all, I think we have moved away from the proper Federation that encouraged subsidiarity, which simply means attacking development from the lowest levels of the country.
â€œIn those days when we had regions, those regions had their own separate constitutions, and where able to develop and grow at their own pace; and there was competition which it possible for development to begin from the local government to the federal government.â€
Meanwhile, the Minister of State for Petroleum Resources, Mr. Odein Ajumogobia, has said a major challenge in the realization of an effective hydrocarbon accounting system in Nigeria is the issue of pipeline sabotage, leakages and vandalisation, security threats and crude oil theft.
He said, â€œGovernment is doing its best to curtail these developments through constructive engagement, surveillance, community involvement and the security agencies. In addition, government is reinvigorating the NDDC to effectively improve the socio-economic living conditions of the Niger Delta region.â€
Ajumogobia added that government was vigorously pursuing the issue of amnesty and reformation programme for the regionâ€™s militants to ensure that peace and harmony prevailed in the Niger Delta.
The minister said a seminar on production accounting was timely â€œespecially at this time that we are reposition the industry and reviewing our strategic approach that will culminate in the re-invigoration and create a more robust system that will boost revenue generation and eliminate uncertainties in the production value chain.â€
Similarly, he said, government was committed to ensuring compliance with the NEITI Act of 2007, adding that, â€œOne of the critical challenges facing the oil industry globally is that of an efficient hydrocarbon accounting mechanism.â€
He said the country had a hydrocarbon accounting system that is custody transfer-based, which is against the global practice of well head-based accounting system.
â€œIn view of this, the DPR established the National Data Repository (NDR) that will serve as the database of the industry, promoting and maximizing the value of Exploration and Production (E&P) data assets and the sharing of data amongst operators,â€ he said.
Ajumogobia said the government was also developing the National Production Monitoring System (NPMS) that will help overcome the challenges that the industry is currently facing, by bridging the lapses in the hydrocarbon accounting and to ensure that all production data were received real time in DPR offices through state of art equipment and facilities.
n his own part, the Norwegian Ambassador to Nigeria, Mr. Tore Nedrebo, remarked that how to account correctly and transparently for petroleum production and revenues was extremely important, but also a complicated and sensitive issue.
He said, â€œWe have had projects on metering and accounting in the bilateral cooperation programme on petroleum management between Norway and Nigeria for a number of years, since the MoU was signed in 2000.â€
â€œOur goal is to make sure that petroleum revenues contribute to sustainable development and poverty reduction, and do not just end up in the pockets of a rich elite making life worse for the poor,â€ he said.
Nedrebo further explained that the cooperation evolves at three levels including the level of petroleum directorates, for capacity building regarding resource management, safety and environmental issues.
MEND claims army broke cease-fire:
ATEKE Tom, leader of the Niger Delta Vigilante and rebel commander in the eastern Niger Delta, Nigeriaâ€™s oil heartland has accused the military of attacking one of his fellow militants with gunboats, underlining the fragility of an amnesty offer from President Umaru Yarâ€™Adua.
Ateke Tom told Reuters fellow rebel leader Soboma George had visited him at his camp in the creeks on Sunday after returning from the capital Abuja to discuss Yarâ€™Aduaâ€™s offer.
He said gunboats from the joint military task force (JTF) which polices the Niger Delta opened fire on George as he left the meeting around Dutch Island, located in the waterway between oil hub of Port Harcourt and the town of Bonny.
A JTF spokesman denied there had been an attack.
â€œI strongly suggest that the JTF should be removed from the creeks because with incidents like this the amnesty program will be jeopardised,â€ Ateke Tom told Reuters by telephone.
â€œThe president should prevail on the JTF to leave the creeks now so that militants can participate in the amnesty freely,â€ he said, adding that nobody had been injured but that he had made a formal complaint to the presidency.
Colonel Rabe Abubakar, spokesman for the JTF, said the taskforce was observing the terms of the amnesty offer.
â€œThe JTF will not attack any militants or their camp. We are very responsible … No attack happened,â€ he told Reuters.
It was not possible to independently verify either version but the conflicting reports highlight the mistrust between militants in camps in the deltaâ€™s creeks and the authorities who are supposed to be implementing the amnesty scheme.
Jonjon Oyeinfe, former leader of ethnic rights group the Ijaw Youth Council who has been involved in negotiations for years, said such incidents showed the JTF must be disbanded.
â€œIt is an army within an army. It is like Mr President is not the commander in chief … orders need to go to the lower ranks,â€ he told Reuters.
â€œWe have said as part of our demands that amnesty should go along with the withdrawal of troops.â€
Yarâ€™Adua offered an unconditional pardon in June to all militant fighters who take part in the amnesty, to try to stem unrest which has prevented Nigeria from pumping much above two-thirds of its oil capacity in recent years.