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Nigeria Loses 3,000MW of Electricity to Forcados Attack

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Minister of Power, Works and Housing, Mr Babatunde Fashola

The Minister of Power, Works and Housing, Mr. Babatunde Fashola has stated that the country is losing about 2,000 megawatts of electricity to the attack on the Forcados subsea pipeline by Niger Delta militants.

Fashola has also decried what he described as the furore about which part of the country gets the lion share of projects, stressing that every road, every bridge, every streetlight, every pipeline is a shared national asset that belongs to each and every single Nigerian.

The Minister told energy reporters at a recent conference they organised in Lagos that not long after the attack on Forcados pipeline, power generation dropped to about 2,000MW from 5,074MW.

Fashola, who was represented by the acting Managing Director of Niger Delta Power Holding Company, Mr. Chiedu Ugbo, however argued that even at the 5,074 in February, the country was still short of where it ought to be as a nation.

“In the short period between when we started work in November 2015 and February of this year, our generating capacity rose to 5,074 MW, the highest we have ever generated as a nation,” he said.

The minister stated that in the 63 years of government monopoly between 1950 and 2013, the country’s maximum generation was 4000MW.

He said the solution was that the needed more power, adding that it is the basis of the first phase of his road map – Incremental Power.

Fashola argued that it is not gas alone that will allow the country to achieve incremental power, stressing that gas is only one solution amongst many other underutilised solutions.

According to him, the 3000MW-capacity Mambila Power Station, for example, is likely to be the government’s most defining in the road to incremental power.

He noted that one of the things that struck him during the budget process was the furore about which part of the country got “the lion share” or how many roads were being built in the North or how many bridges were in the South.

Fashola insisted that those conversations were unworthy of the country’s collective national responsibility.

“Let us be very clear; every road, every bridge, every streetlight, every pipeline is a shared national asset. They belong to each and every single one of us. If a Kano-Maiduguri road is riddled with potholes and adds hours to your journey time, will this not affect commuters who use it irrespective of where they come from? If the Lagos-Ibadan road is not pliable does it not affect the ability of consumers to receive petrol from the Atlas Cove, the Tank farms and other storage points in Lagos that supply other parts of the country? When a pipeline is vandalised in Sapele, those in Ajaokuta, those in Geregu and beyond will feel the impact,” Fashola explained.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Markets

Communities in Delta State Shut OML30 Operates by Heritage Energy Operational Services Ltd

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Oil

The OML30 operated by Heritage Energy Operational Services Limited in Delta State has been shut down by the host communities for failing to meet its obligations to the 112 host communities.

The host communities, led by its Management Committee/President Generals, had accused the company of gross indifference and failure in its obligations to the host communities despite several meetings and calls to ensure a peaceful resolution.

The station with a production capacity of 80,000 barrels per day and eight flow stations operates within the Ughelli area of Delta State.

The host communities specifically accused HEOSL of failure to pay the GMOU fund for the last two years despite mediation by the Delta State Government on May 18, 2020.

Also, the host communities accused HEOSL of ‘total stoppage of scholarship award and payment to host communities since 2016’.

The Chairman, Dr Harrison Oboghor and Secretary, Mr Ibuje Joseph that led the OML30 host communities explained to journalists on Monday that the host communities had resolved not to backpedal until all their demands were met.

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Crude Oil Recovers from 4 Percent Decline as Joe Biden Wins

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Oil Prices Recover from 4 Percent Decline as Joe Biden Wins

Crude oil prices rose with other financial markets on Monday following a 4 percent decline on Friday.

This was after Joe Biden, the former Vice-President and now the President-elect won the race to the White House.

Global benchmark oil, Brent crude oil, gained $1.06 or 2.7 percent to $40.51 per barrel on Monday while the U.S West Texas Intermediate crude oil gained $1.07 or 2.9 percent to $38.21 per barrel.

On Friday, Brent crude oil declined by 4 percent as global uncertainty surged amid unclear US election and a series of negative comments from President Trump. However, on Saturday when it became clear that Joe Biden has won, global financial markets rebounded in anticipation of additional stimulus given Biden’s position on economic growth and recovery.

Trading this morning has a risk-on flavor, reflecting increasing confidence that Joe Biden will occupy the White House, but the Republican Party will retain control of the Senate,” Michael McCarthy, chief market strategist at CMC Markets in Sydney.

“The outcome is ideal from a market point of view. Neither party controls the Congress, so both trade wars and higher taxes are largely off the agenda.”

The president-elect and his team are now working on mitigating the risk of COVID-19, grow the world’s largest economy by protecting small businesses and the middle class that is the backbone of the American economy.

There will be some repercussions further down the road,” said OCBC’s economist Howie Lee, raising the possibility of lockdowns in the United States under Biden.

“Either you’re crimping energy demand or consumption behavior.”

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Nigeria, Other OPEC Members Oil Revenue to Hit 18 Year Low in 2020

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Revenue of OPEC Members to Drop to 18 Year Low in 2020

The United States Energy Information Administration (EIA) has predicted that the oil revenue of members of the Organisation of the Petroleum Exporting Countries (OPEC) will decline to 18-year low in 2020.

EIA said their combined oil export revenue will plunge to its lowest level since 2002. It proceeded to put a value to the projection by saying members of the oil cartel would earn around $323 billion in net oil export in 2020.

If realised, this forecast revenue would be the lowest in 18 years. Lower crude oil prices and lower export volumes drive this expected decrease in export revenues,” it said.

The oil expert based its projection on weak global oil demand and low oil prices because of COVID-19.

It said this coupled with production cuts by OPEC members in recent months will impact net revenue of the cartel in 2020.

It said, “OPEC earned an estimated $595bn in net oil export revenues in 2019, less than half of the estimated record high of $1.2tn, which was earned in 2012.

“Continued declines in revenue in 2020 could be detrimental to member countries’ fiscal budgets, which rely heavily on revenues from oil sales to import goods, fund social programmes, and support public services.”

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