- Nigeria’s Biggest Pipe Factory May Be Shut
After several months of staying idle, the country’s biggest pipe factory owned by SCC Nigeria Limited may be shut down soon as it grapples with lack of patronage amid the recession rocking the country.
The company had in October last year inaugurated the 280,000-tonne ultra-modern steel pipe manufacturing mill in Ushafa, Abuja, with President Muhammadu Buhari represented by the Secretary to the Government of the Federation, Mr. Babachir Lawal, on the occasion.
The Project Co-ordinator, SCC Nigeria, Mr. Festus Onyenenue, spoke with our correspondent on the sidelines of a tour of the facility by some participants of the sixth Practical Content Conference.
Onyenenue said the last production the factory carried out was for the Nigerian National Petroleum Corporation, with the delivery completed in September.
He said, “In this factory, we have a production capacity of 280,000 tonnes for helical submerged arc welded pipes. And then, we also have a brand new coating plant for three-layer polyethylene coating. But now, we are idle. Since June, we have no job to do here and we are still keeping our staff and paying salaries.
“Today, you met the factory in this way because we have a need to produce some pipes for our own internal use. At the completion of this project, this factory may be shut down in the next three or four months, and the whole members of staff will be asked to go home. But we hope that before then, something new will come in.”
The project co-ordinator decried the situation in which a huge facility that could bring money into the country had been idle because of lack of jobs, saying, “The recession has worsened the situation.”
Onyenenue added that as of the time the company was producing, it had about 300 employees working at the factory.
He said, “Right now, as we speak, I am not sure they are up to 100. And as time goes on, we will continue to reduce the number. So, it is as bad as that.
“To the best of my knowledge, there is no other factory like this in the country.”
Asked what could be done to salvage the situation, Onyenenue stated, “What the government needs to do is to channel a large chunk of the pipeline jobs to this factory; the manpower here will remain and then the money will come into the country.”
Nigeria Lost $10.3bn to Boko Haram, Armed Insurgency in 2020
The activities of banditry, Boko Haram insurgency, farmers-herdsmen conflict, separatist agitation and organised violent groups, among others, cost the federation a whopping sum of $10.3 billion in 2020, the Presidential Economic Advisory Council (PEAC) has disclosed.
The economic council gave the figure in a document presented during its sixth regular meeting with President Muhammadu Buhari at the State House, Abuja penultimate Friday, detailing the socio-economic cost of insecurity across the federation.
Buhari had constituted the council under the chairmanship of Prof Doyin Salami to replace the Economic Management Team (EMT), which Vice-President Yemi Osinbajo earlier set up to advise the National Economic Council.
The council, at its sixth regular meeting, dissected the country’s economic environment with a strong indication that insecurity resulting from Boko Haram insurgency, political violence, resource-based violence, organised violence and farmers-herdsmen conflicts had crippled economic activities nationwide and contracted the country gross domestic product (GDP) by 2.6 percent in 2020.
The council cited the grievous consequences of ethno-religious conflicts mostly caused by suspicion and distrust among various ethnic groups and among the major religions in the country.
Examples of such conflicts, as the council documented in its 33-slide presentation, are Boko Haram, conflicts in Southern Kaduna as well as farmers-herdsmen clashes in the Middle Belt, especially Benue State.
The council observed that there was a general consensus of a worsening of the security situation in Nigeria, which it said, included competition for power and ultimately resources, usually around the general election.
Resource based violence, according to the council in its presentation, comprised competition for economic opportunities driven by illegal mining in some states, kidnapping for ransom, Niger Delta militants and pirates and recent farmer-herder conflicts.
The council dissected the dynamics of violent farmers-herdsmen conflict, mainly among groups that peacefully co-existed previously, exacerbated by infiltration of foreigners on the one hand and climate change and environmental challenges on the other hand.
Citing incontrovertible statistical evidence, the council claimed that nationwide insecurity had multidimensional implications, especially for economic and human development.
In terms of economic cost, the council disclosed that insecurity had cost Nigeria $10.3 billion or 2.6 percent of the GDP, which dropped $568.5 billion in 2014 to $375.75 billion in 2017 and rose to $448.12 billion in 2020. The presidential council equally cited a study by the United Nations Development Programme (UNDP) estimating that Nigeria lost $141.9 billion of production to security related violence between 2007 and 2019, a period of 16 years.
The council analysed the impact of human capital, which according to its slide presentation escalated the population of out-of-school children to over 13 million and significantly reduced life expectancy nationwide.
While it claimed that extreme poverty in the conflict zones was accentuated by conflict, the council observed that the unemployment rate, currently standing at 33.33 percent, had steadily increased since 2014, in line with worsening insecurity, thus adding to the population of persons that had fallen below the poverty line.
At large, the council said: “Conflicts and heightened insecurity reduce business confidence, manifested in declining foreign and domestic investment, deteriorating financial sector performance, higher fiscal cost and security spending.”
Consistent with PEAC’s report, as shown in complementary data obtained from the NBS, the volume of the FDI inflow dropped from $2.28 billion in 2014 to $1.03 billion in 2020, accounting for 54.83 percent.
Senate Queries NACA Demand’s Audited Records Of Global Fund
The Senate Public Accounts Committee has sustained the query issued by the Auditor General for the Federation against the National Agency for the Control of AIDS.
The agency was indicted over its alleged failure to make available necessary records of its global funds for audit. The query was issued based on the 2016 Report of the AuGF currently being scrutinized by the Senate panel
The Chairman of the Committee, Senator Matthew Urhoghide, while ruling on the matter at the panel’s last sitting, last week, wondered why the management of NACA failed to submit its financial activities concerning global funds for perusal.
Urhoghide said his panel was interested in the financial activities surrounding the global fund such as the amount received and its utilisation.
The Director of Finance and Account of the agency, Nsikak Ebong, however, told the panel that the financial records of the global funds were available for necessary screening any day.
Ebong said, “The global fund grants records are always available for review. These documents have always been made available to audit or review on demand.”
The representative of the AuGF, Eyitatyo Ageshin, faulted the position of the DFA of NACA. He alleged that when his office requested the documents in 2016, the agency could not present them
He said, “The report was written in August 2016 and they responded on February 20, 2017, almost about seven months after.
“We asked them to respond within 21 days but they didn’t do that. When NACA responded after seven months, they simply said “This is noted.”
“That means that they agreed that they committed an error and you now said the records are ready and available for your (AuGF), office at your convenience.
“That means we should come to your (NACA) office again, the second time. We don’t have that time. We expected you to bring your records to the (AUgF) office because the onus is on you to defend that record. You didn’t bring it.”
Ruling on the matter, Urhoghide said, “There is no proof before us that gave details of what you got from global funds. DFA, you were there when this query was raised in 2016.
“Why don’t you bring the necessary documents that would show us what you got from the global fund? You were coming to the Senate to respond to the query raised against you and you didn’t bring any document to show us. We sustain the query.”
The query partly read, “The records of Global Fund with the Agency were not released for audit examination despite repeated demands.
“As a result, it was not possible to ascertain the total amount received from the Fund during the year to form an objective opinion on the judicious utilization of the money.
“All efforts to obtain the records, including explanations, were not successful.
“Similarly, the financial activities of the Global Fund such as amount received from the Fund and its utilization were not incorporated into the 2015 Financial Statements of the Agency, to form part of the agency‟s incomes and expenditure for the year.
“The Financial Statements of the agency are expected to disclose not only funds from the Federal Government of Nigeria, but also incomes from other sources such as the Global Fund, World Bank, and so on.
“Details of the utilisation of the funds should also be disclosed, to give complete information regarding the financial position of the agency and to avoid misleading the public.
“The Director-General did not respond to my report dated 29th August 2017. He should therefore be compelled to explain the incomplete financial statements. “
NCDMB To Hold Virtual Oil And Gas Opportunity Fair
The Nigerian Content Development and Monitoring Board (NCDMB) has announced that the 2021 edition of the Nigerian Oil and Gas Opportunity Fair (NOGOF) will be held virtually on May 25 and 26, 2021.
The Executive Secretary of NCDMB, Engr. Simbi Kesiye Wabote revealed this last week during a press conference organised in Lagos, adding that the Board decided on the virtual option in compliance with the Federal Government’s guidelines on curtailing the COVID-19 pandemic as well as the subsisting travel restrictions in some countries.
While admitting that hosting the conference virtually was new for the Board and other stakeholders, Wabote expressed excitement that it offers an opportunity for participants to join from anywhere in the world without incurring logistics costs, thereby recording increased participation. He explained that the core objective of organizing NOGOF is to showcase the opportunities that are likely to emerge from the short to medium-term plans and activities of operators and project promoters operating in the upstream, midstream and downstream sectors of the Nigerian Oil and Gas industry.
“We must as NCDMB continue to give hope to Nigerians and the industry and show them that even when you have a pandemic like this, there are still opportunities for people to look forward to and invest,” he said.
He added that the showcase of upcoming projects by operating companies gives Nigerian service companies ample opportunity to build relevant capacities that might be required to execute the projects in-country, thereby creating employment opportunities and retaining spend in-country.
He stated further that “hosting NOGOF is line with the key thrusts of the Nigerian Oil and Gas Industry Content Development Act 2010 (“NOGICD Act”) which charged the NCDMB to build and support the development of local capacities and capabilities in the oil and gas industry, to foster institutional collaboration, maximizing the participation of Nigerians in oil and gas activities, linking oil and gas sector to other sectors of the economy, maximizing utilization of Nigerian resources, among others.”
He noted that this year’s edition of the bi-annual fair would be the third in the series with the theme “Leveraging Opportunities & Synergies for Post Pandemic Recovery of The Nigerian Oil & Gas Industry”.
He said the theme acknowledges the industry wide disruption caused by the COVID-19 Pandemic and it encourages constructive discussions on recovery and the way forward, especially within the context of the energy transition.
He said the fair would feature technical and opportunity sessions from various stakeholders, virtual networking opportunities, an award ceremony in recognition of distinguished industry players and a virtual exhibition opportunity for registered organisations to present their activities and products to delegates.
He recalled that the maiden edition of NOGOF in 2017 at Uyo, Akwa Ibom State had over 1,200 delegates and 33 exhibitors, while the 2019 edition in Yenagoa, Bayelsa State had over 1500 delegates and 52 exhibitors and more delegates would likely partake in this year’s edition.
Dwelling on the impact of NOGOF on the industry over the years, Wabote said some of the projects unveiled in the previous editions were already underway like the Nigeria LNG Train 7, while some others were delayed by the COVID-19 pandemic and would soon start to be executed.
He assured that Nigeria would record impressive local participation in the Train 7 project.
He said: “When we executed Train 1-6, there was minimal Nigerian participation. But today the Nigerian Content and out-country scope are split 50/50. Most of the cryogenic areas would be done outside the country because we do not have capacities in those areas. But 50 percent of the whole project activities would be done through Nigerian business and must be in-country. That is the value that would be retained in the Nigerian economy. We would achieve more in the upstream sector of the project because we have developed capacities in that area.”
Speaking further, the NCDMB boss indicated that the COVID-19 pandemic was the biggest test and confirmation of the need to develop local capacities in the oil and gas and other key sectors of the economy. He said the pandemic forced nations to depend on their local productions to survive, expressing delight that local capacities developed in the oil and gas industry proved capable of sustaining crude oil productions.
He added that First E&P Company -an indigenous operating company completed its project and started producing oil during the pandemic because of local content. “NCDMB insisted that they must build platform in-country. They thanked us later for that decision because their platform was completed even during the pandemic and deployed to work. If the project were being executed overseas, it would have been suspended during the period.”
Responding to questions from the media, the Executive Secretary clarified that Local Content implementation was not at all costs. He maintained that every project has its economics and the return on investments must be viable, which was why the Board adopts pragmatism in its implementation of the NOGICD Act. He added that building local capacities takes some time and that Nigeria’s Content was not about the Nigerianization of personnel, rather it focuses on domestication and domiciliation of industry activities.
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