Since its bold entry into the Nigerian oil and gas exploration and production business, integrated independent energy company, Heirs Energies Limited, continues to soar despite the challenging operating environment, writes Peter Uzoho
In January 2021, when the world, especially the global oil and gas industry, was still reeling with the adverse impact of the COVID-19 pandemic, Nigeria’s industry witnessed the news of a landmark deal of the year.
Then, Heirs Energies (formerly Heirs Oil & Gas Limited) was launched into the Nigerian E&P space, following the completion of an eight-year $1.2 billion transaction to acquire the prolific Oil Mining Lease (OML)17 from the Shell Petroleum Development Company of Nigeria Limited (SPDC), Total E&P Nigeria Limited, and ENI.
With the deal, Tony Elumelu-owned Heirs Energies began the solidification of the joint venture partnership with its new partner, the Nigerian National Petroleum Company Limited (NNPC), which controls 55 percent of the asset.
However, three years down the line, the company, which is still in a celebratory mood as it recently commemorated its third anniversary, has recorded a lot of milestone achievements since its emergence. Within the short scale of entrance into the oil and gas E&P space, Heirs Energies has displayed a track record of significant production increases, pioneered a new model of community engagement, built a world class Nigerian management team with a sound safety record, all contributing to a new beginning in ensuring Nigeria’s sustainable energy future.
The independent energy firm has consequently become a role model institution within the energy sector, through phenomenal milestones and achievements recorded. These achievements are credited to the company’s sound corporate governance and an excellent operational strategy, thus becoming a major competing force in the oil and gas business.
OIL PRODUCTION GROWTH
One major success achieved by Heirs Energies in the last three years of existence and post-asset acquisition is the significant rise in its oil production, which offered a huge boost to Nigeria’s oil production and revenue generation.
At a time when Nigeria is in dire need of optimising its oil output, Heirs Energies’ oil production has grown from about 27,000 barrels per day (bpd) at the take-over of operational control, to a peak of over 50,000bpd 100 days later by October 5, 2021.
Oil losses, which had reached a peak of 97 per cent late 2021 due to theft, has now been reduced to less than 15 per cent, with definitive actions taken by the government in collaboration with operators to address the pipeline security and related concerns.
Built from scratch, with a 100 per cent Nigerian organisation operating to international industry standards, Heirs Energies took over OML-17 asset operations on July 1, 2021, a month ahead of plan, and has been operating the asset without any major incident/accident.
DOMESTIC GAS SUPPLY BOOST
Aside its contribution to the growth of Nigeria’s crude oil production, Heirs Energies has also ensured a steady gas production for domestic use, thus signing on to the federal government’s Decade of Gas objective, which aims to encourage more gas production for domestic use. The energy firm commenced gas production without delay and has rapidly become an important contributor to the domestic gas supply in Nigeria. It achieved its first gas from the Agbada Non-Associated Gas (NAG) Plant on November 21, 2021, after taking over the project in May 2021.The significance of this milestone is accentuated by the fact that the Agbada NAG plant had been under construction for over 10 years by the previous operator and upon takeover, the company demonstrated capability and expertise by quickly bringing the plant to mechanical completion and identifying further growth opportunities. It is gratifying to note that 100 percent of gas produced by Heirs Energies goes into the domestic market to meet local demand, providing energy to thousands of households, supplementing power plants, and supporting various gas-reliant industries in the region.
Also, the company started up Train 2 of the Agbada NAG, at the 80mmscf/d capacity gas production facility located in Port Harcourt, Rivers State. With this facility, Heirs Energies has expanded its footprint within the domestic gas market, allowing for an increased supply to gas-based industries and gas-powered electricity generators.
At the third anniversary ceremony of Heirs Energies held recently, the Chairman, Mr. Tony Elumelu, expressed his pride, while reflecting on his vision for the company. He stated: “As someone from the Niger Delta, I had seen firsthand how Nigeria’s resource wealth can be mishandled. The energy sector was an industry that had frankly not served Nigeria’s interest. I knew Nigeria could do better and control her destiny.
“My vision was to build Africa’s largest indigenous-owned integrated energy company, focused on Africa’s unique energy needs. As I look back now, we have more than succeeded.”
Elumelu, who is also the Chairman of United Bank for Africa (UBA) and Transcorp, commended the Heirs Energies’ team, sharing his deep gratitude for their commitment to his vision of creating value for all stakeholders within the energy sector.
He said: “I want to take this opportunity and mark this anniversary, by saluting and thanking the Heirs Energies team, led by MD/CEO, Osa Igiehon. Your hard work, dedication and expertise has enabled us to become a role model within the energy sector, as we strive towards our purpose of improving lives and communities across our continent.”
With the change in the global oil and gas industry’s dynamics, driven by the energy transition pressures and the need for companies to review their operational models to be fit for sustainability, the then Heirs Oil & Gas Limited, in 2023, responded by embarking on a transformative rebranding journey.
That move led to the company evolving from Heirs Oil & Gas to Heirs Energies. The change, according to the energy firm, “echoes our broader vision to not only meet Africa’s unique energy demands but to do so through sustainable and responsible practices that align with global standards”.
EXCELLENT SAFETY RECORDS
When it set out to become an energy company, Heirs Energies had taken a broad view of the kind of organisation it wanted to be known and remembered as in terms of safety culture and compliance, as well as the type of operator-host community relationship it wanted to have to ensure a peaceful operating environment.
Through the implementation of sound safety policies, the company has been able to achieve top quartile safety records. Specifically, Heirs Energies has sustained zero Lost-Time Incident (LTI)-free operations in OML 17 with 1.5 million man-hours operations in 2023.
The above record is a testament to the firm’s commitment to safety best practices as it maintains its zero incident and fatality record from inception.
ROBUST COMMUNITY ENGAGEMENT
However, in the area of community engagement that works for both parties, Heirs Energies has continued to live up to its philosophy of a Shared Destiny with local communities, by seeking out local talent and creating entrepreneurs.
As a result, over 300 young people have been empowered through skill acquisition programmes, from poultry & fish farming, fashion designing, catering, welding and fabrication etc.
Heirs Energies also carried out electrical infrastructure upgrades across host communities, which have impacted a population of over 270,000 people in Ikwerre, Etche, and Obio/Akpor local government areas of Rivers State.The company’s intervention in education saw it support over 280 undergraduates from host communities with bursary and scholarship awards: classroom furniture upgrades in selected public schools in Etche and Obio/Akpor.Nevertheless, Heirs Energies pioneered establishing the Host Community Development Trust (HCDT), earning commendations from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and setting an industry benchmark for implementing an innovative governance structure, for the HCDT in the Nigerian oil and gas sector.
WORLD-CLASS NIGERIAN ORGANISATION
As a 100 per cent indigenous company, Heirs Energies takes particular pride in its fully Nigerian team, who are catalysing and delivering innovative technical solutions every day.
This is, indeed, a true demonstration of Nigerian excellence in institutionalising and executing key strategies.
Notably, the oil producer recognises the importance of a sustainable future and plans to play a role in Nigeria’s transition to a more sustainable energy source. The company’s journey reflects a commitment to bring abundant and affordable power to schools, hospitals, and industries, shaping a sustainable future for Africa.
Also, Heirs Energies is reputed as one of Africa’s largest indigenous-owned integrated energy companies, committed to meeting Africa’s unique energy needs while aligning with global sustainability goals.
With a strong focus on innovation, environmental responsibility, and community development, the independent energy producer leads in the evolving energy landscape and contributes to a more prosperous Africa.
In recognition of its stellar performances within the short time it has been in operation, a number of reputable institutions have commended Heirs Energies through awards of different categories.
For instance, in 2023, Heirs Energies received the ‘Excellence in Sustainable Energy Operations’ award at the Nigerian Business Leadership Awards by BusinessDay Media. The honour, without doubt, was a resounding affirmation of the team’s vigorous dedication and fervent pursuit of sustainability in every of the company’s initiatives.Similarly, in 2022, it was awarded the ‘Africa Deal of the Year 2021’ by Project Finance International (PFI), following its $1.1 billion financing and acquisition of a 45 per cent stake in OML 17, in January 2021.
- Culled from ThisDay News, Business Special, 12th Feb. 2024 / pg. 38