12 December 2018

Nigeria: Lagos Midstream Jetty to Address Product Distribution Challenges

The Lagos Midstream Jetty, which is West Africa's first privately owned midstream jetty, will address currently challenges bedeviling petroleum products distribution in Lagos, according to ASPM Limited.

The firm, which isa subsidiary of OVH Energy, in a report on Monday, said the launch of this Jetty was borne out of the need to bridge an infrastructure gap in the downstream oil sector by increasing the delivery capacity and offloading efficiency of petroleum products into marketers' storage facilities, while resolving three major challenges; the water channel draft constraints, costs of transferring products to smaller vessels (knows as lightering) and fees incurred by vessels waiting off the coast for open opportunity to berth for product discharge.

Petroleum, according to the report, ranks among the most abundantly available and valuable natural resources in Nigeria, and proven to be an essential source of energy in the country - for automobiles, generators, industrial plants and cooking gas in domestic and industrial usage, adding that it is, therefore, not surprising that the Nigerian economy is heavily dependent on adequate supply and distribution of petroleum products to drive its growth.

With a reported crude oil production capacity of 2.5 million barrels per day (according to the Nigerian National Petroleum corporation), it maintained that Nigeria ranked as Africa's largest producer of oil and the sixth largest oil producing country in the world.

However, the report noted that over 70 percent of the country's domestic petroleum product requirement is met through importation. According to the Nigerian Bureau of Statistics (NBS) in Q1 2018, 5.7 billion litres of Premium Motor Spirits (PMS), 955 million litres of Automotive Gas Oil (AGO), 67 million litres of Household Kerosene (HHK), and 122 million litres of Aviation Turbine Kerosene (ATK) were imported into the country.

It explained: "Most of these products are received by the Pipelines and Product Marketing Company (PPMC) through a number of petroleum jetties in Apapa and transported to various retail outlets and depots across the nation via pipelines and trucks. Before now, these jetties were known for and limited by their shallow drafts, being incapable of accommodating large volumes of fuel imports, with maximum vessel size limited to between 18,000MT and 20,000MT.

"These constraints posed a major challenge for industry stakeholders across board including government agencies and major fuel importers."

One year after it was officially inaugurated, the Lagos Midstream Jetty, is said to have received a total of 61 vessels up to a maximum capacity of 38,000mt of product in one lot eliminating the need to lighter (transfer products to smaller vessel) and draft constraints which some other jetties in Apapa are challenged with. The Jetty is also successfully connected to eight fuel tank farms in the Apapa/Marine beach axis with approximate combined PMS storage capacity of 225,000mt.

According to the report, there has been no product spills nor injury to operations personnel on the jetty from inception till date, which further emphasises the adherence to world class environment and safety standards in accordance to the NFPA-30 standard (National Fire Protection Association - an international body that sets standards for fire protection systems). The facility is said to be able to discharge multiple products including PMS and AGO operations as a proof of its versatility.

ASPM, therefore, said: "In spite of numerous achievements recorded over the last one year, we have continue to work with relevant authorities to minimise the impact of some of the challenges still faced in the industry which includes pre-discharge activities such as sampling, issuance of permits and other regulatory activities.

"Support from regulators on prompt clearance of vessels at berth not only guarantees swift product discharge operations and availability nationwide, but also saves petroleum marketers and the nation in general thousands of dollars which can be deployed towards executing other valuable initiatives."

Nigeria

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