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We Won’t Succumb to Blackmail, VON Automobile Tells Senate

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  • We Won’t Succumb to Blackmail, VON Automobile Tells Senate

Automobile manufacturers, VON Automobile Nigeria Limited, yesterday refuted allegations by the Senate, accusing the company of economic sabotage, saying it was absolute falsehood and premeditated blackmail to disparage their accomplishment.

VON Automobile Managing Director, Adetokunbo Aromolaran, made this remark in his speech at an extraordinary session with the media at a guided tour of the company’s facility in Ojo, Badagry Highway, Lagos.

Aromolaran who passionately condemned the claim of the senate published on Sunday, November 20, described it as unsubstantiated, adding; “rather than investigate their story, some media houses made themselves easy tools in the hands of mischievous blackmailers.”

He said: “for the avoidance of doubt, we regard the whole exercise as one of blackmail, the objectives of which will not be realised because they are false.”

He therefore urged the media to always investigate their reports and ignore “calculated blueprints for calumny and cheap blackmail.”

Senator Hope Uzodinma-led Senate Committee on Customs, Excise and Tariff had on October 28, during one of its oversight assignments claimed that it discovered 1,500 units of exotic vehicles concealed in the Volkswagen warehouse, wondering if the vehicles were assembled at a deserted facility with disused equipment, he was quoted.

The Senate Committee consequently labeled VON Automobile as economic saboteur, warning it would organise a public hearing to unravel allegations of sharp practices even when the Nigeria Customs Service public relations officer Wale Adeniyi was quoted as saying he couldn’t verify the development.

VON Automobile Limited is the local assemblers of Hyundai, Nissan and Volkswagen passenger cars with Ashok Leyland and Iveco buses and trucks respectively.

Dismissing the allegations as smirk of a preconceived plan to embarrass VON Automobile, the director described the company as a responsible organisation guarded by ethical values and believe in the rule of law and constituted authority in the discharge of its duty, even when times become frustratingly overbearing, he says.

Mr. Aromolaran who claimed the oversight visit to the plant was presumptuous said: “We were at a loss whether the oversight team was a visit to VON Automobile Nigeria Limited, the vehicle assembly plant or a customs raid on a commodity warehouse.

“Little wonder there was disbelief when they were told no commodities were warehoused on the premises but on insistence, they inspected all warehouses even those not under VON operations and didn’t discover a grain of any commodity – an operation, which in itself, was illegal,” the plant helmsman declared.

The perceived inspection halted VON Automobile plant operations for one week to pave the way for inventory and verification of all documentation of vehicles on the premises and also resulted in the compulsory closure of the factory gates till the examinations was decided, Mr. Aromolaran told the news crew.

According to him, “We had on request by the Nigeria Customs Service officials made available full inventory of vehicles on the premises with evidence of duty payments including those assembled from knocked down components.”

He then wondered why the hue and cry about 1, 500 vehicles at a plant with combined capacity for 45,000 vehicles in one shift.

“Save for economic recession that took a toll on the vehicle market with plummeting sales and subsequent production cuts, a typical inventory of vehicles awaiting delivery should outweigh current inventory holding,” the director reasoned.

The National Automotive Council had lately said a declining Gross Domestic Product growth impacted on vehicle replacement rate, causing a corresponding decline of 37.5 percent in demand for new and used automobiles from 400,000 vehicles to 250,000 vehicles.

Meanwhile, Senator Sam Egwu – led Senate sub-committee on Industries in conjunction with Senator Barnabas Gemade had earlier in November visited the VON Automobile facility in an oversight assignment that did not cause any superficial comments, the plant director elicited.

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.

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Crude Oil

Petrol Subsidy Likely to Gulp N2T This Year –Rainoil GMD

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Nigeria may end up spending N2 trillion on petrol subsidy this year if the current situation persists, the Group Managing Director, Rainoil Limited, Dr Gabriel Ogbechie, has said.

Ogbechie said this on Sunday at the Nigeria History Series of the Centre for Values in Leadership, themed ‘Indigenous participation in the downstream oil and gas sector’ moderated by Prof. Pat Utomi.

While lamenting the lack of deregulation in the downstream sector, he said the government was spending about N8m daily on petrol subsidy.

He described the sector as highly regulated, saying, “I wonder if there is any other sector of the economy that is as regulated as the downstream.”

He said, “The biggest elephant in the room today as far as the downstream is concerned is the failure, so to speak, of the government to deregulate the downstream – fixing the price at which petroleum products are sold, I believe, is very seriously harmful to this economy.”

According to him, the landing cost of the petrol imported into the country is about N300 per litre, based on the current naira-dollar exchange rate.

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Crude Oil

Sirius Petroleum and Baker Hughes Collaborate on OML 65 Drilling in Nigeria

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Sirius Petroleum, the Africa-focused oil and gas production and development company, has signed a memorandum of understanding with Baker Hughes. The MoU names Baker Hughes as the approved service provider for Phase 1 of the Approved Work Program (AWP) of the OML 65 permit, a large onshore block in the western Niger Delta, Nigeria. Baker Hughes will provide a range of drilling and related services at a mutually agreed upon pricing structure to deliver the initial nine-well program.

Sirius has signed various legal agreements with COPDC, a Nigerian joint venture, to implement this program. COPDC has signed a Financial and Technical Services Agreement (FTSA) with the Nigerian Petroleum Development Company (NPDC) for the development and production of petroleum reserves and resources on OML 65. The FTSA includes an AWP which provides for development in three phases of the block. and Sirius has entered into an agreement with the joint venture to provide financing and technical services for the execution of the PTA.

The joint venture will initially focus on the redevelopment of the Abura field, involving the drilling and completion of up to nine development wells, intended to produce the remaining 2P reserves of 16.2 Mbbl, as certified by Gaffney Cline and Associates (GCA) in a CPR dated June 2021.

Commenting, Toks Azeez, Sales & Commercial Executive of Baker Hughes, said: “We are extremely happy to have been selected for this project with Sirius and their JV partners. This project represents an important step towards providing our world-class integrated well-service solutions in one of the most prolific fields in the Niger Delta. Baker Hughes’ technological efficiency and execution excellence will help Sirius improve its profitability and competitiveness in the energy market.”

Bobo Kuti, CEO of Sirius, commented: “We are delighted to have secured the services of one of the world’s leading energy technology companies to work with our joint venture team to deliver the approved work program on the block. OML 65. We look forward to building a long and mutually beneficial partnership with Baker Hughes.”

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Energy

Egbin Decries N388B NBET Debt, Idle Capacity

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Egbin Power Plc, the biggest power station in Nigeria, has said it is owed N388bn by the Nigerian Bulk Electricity Trading Plc for electricity generated and fed into the national grid.

The company disclosed this on Tuesday during an oversight visit by the Senate Committee on Privatisation, led by its Chairman, Senator Theodore Orji, to the power station, located in Ikorodu, Lagos.

The government-owned NBET buys electricity in bulk from generation companies through Power Purchase Agreements and sells it to the distribution companies, which then supply it to the consumers.

The Group Managing Director, Sahara Power Group, Mr. Kola Adesina, told the lawmakers that the total amount owed to Egbin by NBET included money for actual energy wheeled out, interest for late payments and available capacity payments.

Egbin is one of the operating entities of Sahara Power Group, which is an affiliate of Sahara Group. The plant has an installed capacity of 1,320MW consisting of six turbines of 220 megawatts each.

The company said from 2020 till date, the plant had been unable to utilize 175MW of its available capacity due to gas and transmission constraints.

Adesina said, “At the time when we took over this asset, we were generating averagely 400MW of electricity; today, we are averaging about 800MW. At a point in time, we went as high as 1,100MW. Invariably, this is an asset of strategic importance to Nigeria.

“The plant needs to be nurtured and maintained. If you don’t give this plant gas, there won’t be electricity. Gas is not within our control.

“Our availability is limited to the regularity of gas that we receive. The more irregular the gas supply, the less likely there will be electricity.”

He noted that if the power generated at the station was not evacuated by the Transmission Company of Nigeria, it would be useless.

Adesina said, “Unfortunately, as of today, technology has not allowed the power of this size to be stored; so, we can’t keep it anywhere.

“So, invariably, we will have to switch off the plant, and when we switch off the plant, we have to pay our workers irrespective of whether there is gas or transmission.

“Sadly, the plant is aging. So, this plant requires more nurturing and maintenance for it to remain readily available for Nigerians.

“Now, where you have exchange rate move from N157/$1 during acquisition in 2013 to N502-N505/$1 in 2021, and the revenue profile is not in any way commensurate to that significant change, then we have a very serious problem.”

He said at the meeting of the Association of Power Generation Companies on Monday, members raised concern about the debts owed to them.

He added, “All the owners were there, and the concern that was expressed was that this money that is being owed, when are we going to get paid?

“The longer it takes us to be paid, the more detrimental to the health and wellbeing our machines and more importantly, to our staff.”

Adesina lamented that the country’s power generation had been hovering around 4,000MW in recent years.

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