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Seplat Founders, Avuru and Orjiako, Settle Rift

By Onyema Dike

Austin Avuru, founding CEO of Seplat Energy and Ambrosie Bryant Chukwueloka (ABC) Orjiako, pioneer chairman of the Nigerian independent, may be moving from the court room to the negotiating table if emerging feelers from a peace meeting brokered by Layi Fatona, Vice Chairman of ND-Western E&PLimited, is anything to go by.

Fatona who is a friend and senior industry colleague of the two has stepped in to arbitrate and there seems to be a shifting of grounds and settling of the rift between the dueling partners.

Cerebral, connected and successful, the two men; geologist/petroleum engineer and Orthopedic surgeon, founded Seplat in 2010, took it public in 2014 in a dual listing on the NSE and LSE and nurtured it into Nigeria’s most successful independent oil and gas company.

Seplat Energy is currently regarded as the seventh most valuable stock on the NGX with a market capitalization of around £700Million. That figure represents about 2.86% of the Nigerian Stock Exchange equity market.

The two fell apart in August 2022 following a court injunction by an Abuja High Court presided over by Justice SB Belgore who put a stop to Austin Avuru’s planned retirement dinner. The dinner was supposed to feature the unveiling of three of his books.

Claimants representing his partner, ABC Orijako, had insisted that portions of the books maligned Orjiako and the company. The Abuja court issued the injunction following a motion exparte filed by Tochukwu Peter Tochukwu, Esq. but moved by Nsikan Samuel Ekpeyong, Esq. with Motion No. M/9442/2022 dated 26th day of July 2002. Avuru, who retired as CEO of Seplat in August 2022, has been waging a legal battle to vacate the injunctions.

This new development signals a shift in their positions and could lead to a possible out of court settlement if Layi Fatona is able to keep them long enough at the negotiating table.


Sanmi Famuyide is the New CEO of Decklar Resources

Decklar Resources, the Canadian minnow which controls three Nigerian marginal oil fields, has appointed the Nigerian banker, Oluwasanmi “Sanmi” Famuyide, as its Chief Executive Officer (CEO).

The appointment is subject to the Toronto Venture Exchange (TSX-V), which is Canada’s version of the Nasdaq Small Cap Index of over-the-counter markets.

Famuyide has worked as Managing Director of Decklar Petroleum (Nigeria) Limited since its founding four years ago, where he led the asset acquisition transactions resulting in the Company’s current portfolio of three risk service assets (for Oza field, Assaramatoru Field and Emohua Field) in Nigeria. Declar Resources Inc., the international company, acquired Nigerian-based Decklar Petroleum Limited between late 2020 and early 2021.

With Famuyide’s elevation, Duncan Blount, an American national, “has stepped down as CEO of Decklar effective immediately and will continue to serve on Decklar’s board of directors as a non-executive director”, the company explains.  Mr. Blount’s LinkedIn page indicates that he has been, since August 2022, the CEO of Chilean Cobalt Corp. (C3), a privately-held critical materials exploration and development company focused on developing the La Cobaltera project located in Chile’s historic San Juan cobalt district

“Mr. Famuyide has over 20 years of experience structuring and executing on oil, gas and infrastructure transactions across Africa”, the company says in a statement. He “has performed the role of asset manager and has been directly involved in and responsible for key stakeholder engagements. His previous roles include Head of Business Development at Lekoil Limited, Head of Investment Banking Coverage at FBN Capital and Head of Oil & Gas – Marginal Fields and Independents at Guaranty Trust Bank”.

Decklar’s new CEO has an MSc in Applied Environmental Economics from the Imperial College London, and a BSc in Chemical Engineering from the University of Lagos.

 


Wael Sawan Takes Hold at Shell, as Ben van Beurden Steps Down

UK major Shell has announced that Ben van Beurden will step down as Chief Executive Officer (CEO) at the end of 2022, and that his successor will be Wael Sawan.

Sawan’s appointment is effective January 1, 2023, when he will also join Shell’s Board of Directors.

Ben van Beurden will continue working as adviser to the Board until June 30, 2023, after which he will leave the group.

The incoming CEO is currently the Director Integrated Gas, Renewables and Energy Solutions, and was previously the Director Upstream. He is based in The Hague and has been a member of Shell’s Executive Committee (EC) for three years. Prior to joining EC, he was the Executive Vice President Deepwater and a member of the Upstream Leadership Team, and Executive Vice President Qatar and a member of the Integrated Gas Leadership Team

“Ben can look back with great pride on an extraordinary 39-year Shell career culminating in nine years as an exceptional CEO.”, says Andrew Mackenzie, the company’s non-executive Chairman, “During the last decade, he has been in the vanguard for the transition of Shell to a net-zero emissions energy business by 2050 and has become a leading industry voice on some of the most important issues affecting society.
He leaves a financially strong and profitable company with a robust balance sheet, very strong cash generation capability and a compelling set of options for growth. These were all enabled by bold moves he has led, including the 2016 acquisition of BG and the transformational $30Billion divestment of non-core assets that followed. He took firm, decisive action to marshal the company through the global pandemic, seizing the opportunity for a major reset to ensure we emerged fitter, stronger and equipped to succeed in the energy transition. Powering Progress, Shell’s detailed strategy to accelerate our profitable transition to a net-zero emissions energy business by 2050, was unveiled in February 2021 and was quickly followed by moves to simplify both our organisational and share structures. Ben’s legacy will frame Shell’s success for decades to come.”

WAEL SAWAN HAS WORKED IN EUROPE, Africa, Asia and the Americas during his 25-year Shell career, and has also held roles in Downstream Retail, and in various commercial and New Business Development projects. Wael was born in Beirut, Lebanon, and is a dual Lebanese-Canadian national. He grew up in Dubai and holds a Master’s degree in Chemical Engineering from McGill University in Montreal and an MBA from Harvard Business School. He is married to Nicole and they have three sons.


Chevron Appoints Nigerian Engineer as CEO of its China Business Unit

American oil major Chevron Corp. has appointed Segun Kuteyi as Managing Director at Chevron China Business Unit.

He will lead Chevron’s value-chain business strategies in the world’s second largest economy.

As the President of Chevron China Energy Company (CCEC) Pte. Ltd. and Unocal East China Sea Ltd (UECSL), Kuteyi will navigate the company’s partnerships with all stakeholders in the south east Asian country.

UECSL has a contract with China National Petroleum Corporation (CNPC) for natural gas development and production in Chuandongbei Block in the Sichuan Basin in southwestern China. CCEC works with partners to develop offshore energy resources in the South China Sea and in Bohai Bay.

“Operating under Chevron (China) Investment Co., Ltd and Chevron Hong Kong Limited, Chevron® and Caltex® brands have become an established marketer of lubricants and fuels products in China”, the company says on its website. Kuteyi will have oversight of these portfolios.

A 1993 graduate of Chemical Engineering from the Obafemi Awolowo University in Nigeria’s south west, Kuteyi has had executive education at Rice University, Harvard Law School and SMU Cox School of Business.

He joined Chevron as a process engineer on the Escravos Gas Plant (EGP) in 1996. He has moved up the rungs in roles with increasing responsibility across the value chain, including stints in Facilities/Project engineering, Terminal engineering, Asset Management, Strategy & Business Planning, Downstream Gas Operations and Pipeline & Power.

Kuteyi’s career breakthrough came in 2011, with the promotion to Project Manager for EGP3B, a crucial position that superintends Chevron Nigeria’s 600Million standard cubic feet per day capacity plant, in which a significant fraction of gas delivered in Nigeria’s domestic market is processed. Kuteyi is going to China from Houston, Texas, where he was part of the Chevron Pipeline & Power team.


Adriano Mongini is the first CEO of Azule Energy

Italian explorer ENI has seconded Adriano Mongini to Angola to take charge of the new company it has just formed with bp, the British major.

Mongini is an African specialist within ENI’s corporate management.

He has been Executive Vice President for the East Africa Region at ENI since September 2019. From October 2017 to September 2019, he was in charge of the Upstream Procurement Services & Industrial Analysis. In December 2012, he became Senior Vice President of the North Africa and Middle East region and then in 2014 Executive Vice President for North Africa. In 2016 he was also appointed General Manager of IEOC again.


Michael Silver Gives Notice, Leaves VAALCO

VAALCO Energy, the Houston based minnow, says that Michael Silver, its Executive Vice President, General Counsel, Corporate Secretary and Chief Compliance Officer, has advised of his intention to leave VAALCO to pursue other interests.

“Mr. Silver will remain with the Company for a transitional period to facilitate consummation of the proposed arrangement with TransGlobe Energy Corporation”, VAALCO says in a statement. “The Company has launched an executive search to find a replacement for the position”.

Silver was named Vice President and General Counsel on April 1, 2019 and before that served as VAALCO’s Senior Counsel since joining the Company in November 2018.    Prior to joining VAALCO, the American lawyer had a long and successful career with multiple legal roles for a number of companies in the energy sector.   Mr. Silver began his career with ExxonMobil Corporation’s Law Department in 1990.

“Michael was a part of the executive team that guided VAALCO through some very challenging periods for the industry and helped the Company emerge stronger”, commented George Maxwell, VAALCO’s Chief Executive Officer. “We will miss his legal guidance and strategic insight and we wish him the best in his future endeavours.”

 


Libya’s New Top Oilman Meets ENI’s Chief in Rome

Farhat Omar Bengdara, the newly appointed chairman of Libya’s National Oil Corporation has met Claudio Descalzi, chief executive of Italian giant ENI, in Rome.

Bengadara led a delegation of NOC’s senior executives to Claudio Descalzi’s office, to discuss ENI’s activity in the country and strategic projects.

The Italian firm, semi owned by the state, is the largest private sector hydrocarbon producer in North Africa.

Bengdara, who served as Libya’s Central Bank Governor from 2007 to 2011, took over from the charismatic Mustafa Sanalla, who has led NOC since May 2014 until his ouster in July 2022.

“Claudio Descalzi confirmed to the NOC Chairman Eni’s full commitment towards operational activities in the country and expressed the willingness to launch a new phase of investments aimed at increasing Libya’s gas output”,ENI said in a press statement, “leveraging on the significant exploration potential as well as on the existing facilities which grant access to the domestic and the European export markets”.  The statement said the two leaders discussed on implementation of renewables projects in the country, while ENI’s CEO “welcomed the NOC plan to increase the daily output of the Country up to 2Million barrels of oil per day and reaffirmed Eni’s support to reach this target for the mutual benefit of the parties”.

 


Fadahunsi Is the New Business Opportunity Manager for Shell Nigeria’s BSWA Development

Shell has appointed Olaposi Fadahunisi as the Business Opportunity Manager for Bonga South West Aparo, the company’s-and Nigeria’s-next large sized oilfield development.

The new role moves Fadahunsi from Shell Petroleum Development Company (SPDC) which operates the company’s onshore assets, back to Shell Nigeria Exploration Production Company, the company’s subsidiary focused on frontier (mostly deepwater) assets, where he has been for most of his 24 years with the company.

A trained Engineer who started his oil industry career as a Drilling Rig Tour Pusher with the Italian contractor Saipem, Mr. Fadahunsi has worked in engineering and project management roles with Shell since 1998, until his last two roles, which were business development related.

For 10 years from September 2008 to July 2018, Posi, as he is fondly called by industry colleagues, was Shell Nigeria’s Deepwater Business Opportunity and Non Operated Ventures Manager, a role he played in SNEPCO. From July 2018 to May 2022, he was Domestic Gas Business Opportunity Manager, a job domiciled in SPDC.

Prior to that he was Subsea Systems Engineer/Project Leader Apr 1998 – Feb 2003); Venture Engineering Team Leader for the Bonga Integrated Project (Jan 2003 – May 2005) and Project Manager for the Bonga NW Deepwater Project(Jun 2005 – Sep 2006), all in Houston, Texas, United States.

 


Ado Oseragbaje Takes Charge at Heritage Oil in Nigeria

Heritage Oil Limited has announced the appointment of Adogbeji (Ado) Oseragbaje as its new Chief Executive Office with effect from the 14th of July 2022.

He will also lead HOL’s Nigerian operations as Chief Executive Officer of Heritage Energy Operational Services Limited.

“Ado brings a wealth of experience to the role that will be of huge benefit to the company and its stakeholders, particularly in Nigeria”, says Michele Faissola, Chairman of HOL. “We are delighted to appoint a person of Ado’s calibre as our new Chief Executive Officer.”

Oseragbaje “brings twenty-five years of global leadership experience in the oil and gas business and joins us from Baker Hughes where he was Vice President covering Sub-Saharan Africa”, according to the company statement. “He has previously held senior positions, including at General Electric and Schlumberger, across the world”.

HOL’s new CEO holds a Master’s degree in Petroleum Engineering from Imperial College London and a Diploma in Real-Time Oilfield Project Management from Heriot-Watt University Scotland. “I am excited to join the Heritage team”, he says. “The Company has a diverse portfolio, world class assets, the potential for future expansion and an ambition to join in addressing the dual challenge of energy security and sustainability. I think we are a great fit and I’m looking forward to this opportunity.”

Naeem – Atiq Sadiq, has now stepped down from his current role as Chief Executive Officer of HOL and HEOSL but will remain with the company for an interim period to facilitate a smooth handover to Oseragbaje.

Heritage Oil was founded in Canada in 1992 and was acquired by Energy Investments Global Ltd in 2014.

 

 


‘We must focus on gas because of the many industries that it catalyzes’

The final of four instalments of a wide ranging interview with Gbite Falade, Chief Executive Officer of Niger Delta Exploration & Production (NDEP) , in which he fields questions from  Africa Oil+Gas Report about his company’s medium term strategy, deliverables and the energy transition. NDEP is the most integrated Nigerian homegrown independent, with crude oil production from the Ogbele field since 2005, a 100MMscf/d gas processing plant installed since 2012 and a three train 11,000BPSD refinery which took off as a 1,000BSPD topping plant in 2011. It holds a 42% interest in NDWestern, a special purpose vehicle for acquiring Shell’s divested assets and operates the Omerelu marginal field and the Oil Prospecting Lease (OPL) 227.

Of the three parts of the chain, upstream, midstream and downstream, which of them is your core?

My broad exposure prior to coming here gives me a very open mindset but I am fixated on where value can be created the most. Interestingly, none of the three parts that we are into is a replacement for any of the other two.

We don’t see any one of them as a replacement for the other or as a competition but we see them as a relay where there is a hands off from one to the other. Overall, the bigger picture is the domestication of consumption here in the country and within the sub region and there is also superior sustainable value creation for our shareholders that is in a way that shields us significantly from the vagaries of international dynamics of buying your crude oil or buying your gas but this puts us in a space where we can finally take the final product to the people that need it.

If you were sitting here six years ago, would you have taken the decision to build a refinery?

That investment is consistent with the DNA of this company. This has been a company of many firsts and if there was one company that would have successfully pioneered this, I am not sure you would have to look beyond NEDP. There are some level of risk taken in a very responsible way that is part of the  DNA of this company; if this company never took any risks, I am not sure we will be where we are today. Is it guaranteed that all those risks will pay off? No. But as you know, the vision was 2020 but as at today, do I think it was an inspired decision? Absolutely yes.

When you get to those low moments when you are speaking about $30-$40 per barrel [of crude], then your refinery helps you to get more value that you otherwise would not have gotten if you stayed strictly as an upstream player. It is diversification strategy if pursued with care. If handled responsibly, it can be profitable.

Is it an economically sound judgement to have  to sell a chunk of the refinery products in (the local currency) Naira?

It is not in the strictest sense because when you consider the fact that the key elements of your refinery are denominated in dollars, the CAPEX to build is dollar denominated, the feedstock you buy is also dollar denominated. It is a huge exposure when you are then selling your refined product in Naira. And a Naira that is showing a significant level of instability in exchange rate against the dollar. It is a nightmare but I believe that those are some of the things that task our creativity. Our creativity in resolving this is going to be a combination of operational and commercial measures. Commercial measures to seek the appropriate hedging structures that hedges against currency devaluation and also price fluctuations.

NDEP averages 12,000BOPD from the Ogbele field but can the existing reserves sustain it for another 2-3 years for example?

At the start of 2021, we were on 9,000BODP but about nine months after, we had cruised to 12,000BOPD, not because we have drilled an additional well but an outcome of production optimization and well intervention in a “rigless” way. We strongly believe that with the envelope of what we have today, can sustain that 12,000BOPD both on the infrastructure level and in the sub-surface. We are going through some sub-surface data [that] shows us prospects that are decent and significant and material enough not only to sustain the 12,000BOPD threshold that we are on right now but to take us higher by a factor of at least 50%. And this is the general story of the Niger-Delta basin.

At the time we took over the asset, the initial view was that there was about five million barrels of oil in place but at some point, it was upgraded to 10 million barrels in place. In 15 years of production, we have successfully extracted 20 million barrels and we are still producing at the level that we are right now. So, the continuous examination and re-interpretation of the data that we have today shows us that there is still a whole lot possible. We are finding out is that most of the reservoirs that we have in Nigeria contain a whole lot more than we have given them credit for. What is necessary is the proven experiences at the subsurface examination and interpretation and the right skill set of being able to drill the right wells and drill it at the right cost. And then, for the above surface skills to set up the above ground infrastructure to operate it. We have that in NDEP and not just we do have that we are carefully making the right calls of adding horsepower in the relevant areas such that we would continue to function as a center of excellence for hydrocarbon discovery and extraction and safe production.

What about the undeveloped assets:  Omerelu and OPL227?

We are carrying out re-interpretation and reassessment of the resource that we have in Omerelu and OPL 227. We  will soon see some limited campaign in terms of further exploration and appraisal in both Omerelu and OPL 227. We are convinced that the outcome of the ongoing subsurface data review will translate into a new field development plan for those two assets and they are firmly within our program of expanding our resource base as a company.

Are you thinking of more asset acquisition and can we briefly talk about gas?

Starting off from where we are today, Omerelu and OPL227 are in play for us. But I think the reality is that when we are done with the [data] reinterpretation and then we can speak with certainty about them.

In terms of gas play, we are 53MMscf/d and we are on a journey to double that in 2022. That’s for the ready market. But there is also new investment in capacity we are making. The lead time for gas development is such that you cannot wait until the problems are fully solved before you make the investment otherwise you would be left stranded.

Who are the main offtakers of the 53MMscf/d of gas that you produce?

What we are doing today is that we are still supplying to only those two guys but for one of them, which again I will like to keep quiet about, we are going what you can call an excess gas supply which they are happy to take because they have got the capacity to take more. But we are also conversing with some other domestic offtakers who we expect within the next couple of months should come onboard. And the excess gas becomes a subject of a contracted arrangement with them.

What is your sense of the end of the fossil fuel era ?

At some point, whether it’s 10 or 15 years from now, we will begin to see the shift as has been evident over the past 3 to 4 decades. We have been seeing an increase in the energy mix to what it is today. Would it lead to the elimination of oil as a primary energy source? No, but there are certain events that would alter the energy mix.

What is clear is that globally, gas will play that role for the foreseeable future as a transition fuel. For us in Nigeria, we must focus on gas because of the many other things that it catalyzes, we must focus on gas because of its ability to help us get out of the power deficit that we find ourselves in, we must get more into gas because of the feedstock characteristics of our agribusiness and our petrochemical business. We will continue to use gas either as fertilizer, urea and many other gas based industry. Gas looks like it is going to have a more enduring energy mix future globally and in Nigeria than it is for oil but the timing when that inflection would weigh more on gas than it is on oil is going to be driven more by events than by the passage of time.

You talked about planned increase in gas processing  capacity; how much increase, in what time frame, are you looking at?

What we have today is about 100MMsfc/d processing capacity. We have pre-invested and taken an investment decision to expand that to 400MMscf/d. We are expanding it by an additional 300MMscf/d. We have taken custody of the equipment to carry that out and at the rate at which we are going, we foresee that in the next one or two years, we would have installed and commissioned that additional 300MMscf/d. There is more than enough latent demand in the market both in terms of export and domestic consumption.

You did say that your current production of crude is 12,000BOPD and now you would be running this 11,000 barrels per day Refinery. Does that mean you commit all of that crude volume to the refinery?

No. We still have obligations as it were in terms of payments that we have to generate in dollars so the option of export sale of our crude is not one that we can take off the table so that we do not default in our obligations. The PIA allows us to buy crude from within the country either from the NNPC or other operators and devote that to refining. We are going to run the refining as a standalone separate business such that with or without the crude from the upstream side, we can continue to run and operate with assured feedstock supply.

If the refinery is a separate entity, why is the gentleman you hired to run it not CEO but GM?

We are in a growth; we are in an evolution and one of the key principles guiding our success is the fact that we operate very lean and we grow responsibly. There are plans for each of the subsidiaries to be run by substantive CEOs. I double as CEO for the group and also for the entities but as we grow and as we create the robustness of our cash flow, we then begin to onboard each of the people that would take each of these entities and run with them as separate SPVs.

Would you say that your upstream asset would be able to do say 18,000BOPD in the next five years?

The five-year journey would see us with our own equity of crude in the upstream of not less than 50,000BOPD. At the midstream gas processing, we will directly be pushing not less than 300MMscf/d and in the refinery, we see it growing beyond 11,000 barrels per day during that timeframe. We have a clear view as to where our five-year projection is like but we strongly believe that the next five years is going to be transformational for us. Transformational would then be interpreted in terms of scale. Will the scale come from the current set of assets that we have today? No. We are keenly looking at acquisition opportunities in order to provide the resource base for the kind of target that we are shooting for.

Let me ask you about the ongoing Shell divestment. It’s down to two companies. A lot of people are upbeat about ND-Western being the lead runner. NDEP is a large shareholder in NDWestern. What is the model?

We are looking for resources where we can find them. We will also continue to put ourselves forward where those opportunities are manifesting themselves and it is only a matter of time. Because we also recognize that the people who are divesting are not just bothered about what they would cash out on but also about the legacy that they are leaving behind and how that would be sustained over time. When you get to that point, it is companies like us that have continued to prove ourselves that would be there ultimately. Whether that would happen during primary divestment or secondary one, is anybody’s guess but we are on a long game and we are going to stay there.

Did companies come to you who were struggling to pay their signature bonus in the marginal field bid round and therefore asking you to take over?

Yes we have had several of them and we have had them in the tens. We have been approached severally but because we are also a very careful builder of value, we are not carried away by everybody that approaches us. We are looking at above ground issues, the chances of being able to operate those marginal fields successfully and a compendium of other factors in other to make up our minds whether we are going to go with anyone of them or with nobody at all.

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