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NNPC HQ Targeted N912m, Posted zero Revenue in October

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NNPC
  • NNPC HQ Targeted N912m, Posted zero Revenue in October

The corporate headquarters of the Nigerian National Petroleum Corporation did not generate any revenue in October 2016 and failed to contribute any amount to the group purse for the month.

The latest monthly NNPC Group Financial Report obtained in Abuja on Friday showed that the national oil firm’s headquarters failed to generate revenue despite targeting a revenue generation of N912m for the month in review.

The CHQ had in September 2016 generated N4.14m, recorded an expenditure of N13.333bn and posted a total deficit of N13.329bn.

It, however, could not sustain that tempo of income generation in October, as it posted zero revenue in the review month, incurred an expense of N14.84bn and recorded a total deficit of N14.84bn.

A further analysis of the report, however, showed that the NNPC as a group reduced its total losses from N17.18bn in September to N16.85bn in October, while its deficit for the 10-month period beginning from January this year was put at N161.76bn.

The national oil firm stated that it had been operating in a challenging environment which limited its aspiration to make profit.

It explained that the marginal improvement in its trading deficit between September and October was due to improved petroleum products sales and enhanced cost control across the group.

“Factors that still drag the NNPC performances include the force majeure declared by the SPDC as a result of vandalised 48-inch Forcados export line,” it added.

In their review of the corporation’s performance, analysts at FBN Capital Research stated that the NNPC results were again hamstrung by sabotage.

They highlighted the fact that the corporation’s accounts for October showed a group operating deficit of N16.9bn, which was slightly lower than the N17.2bn recorded in the previous month.

They said, “The driver was an improved performance from the Pipeline and Products Marketing Company, which boosted its sales to N112bn from N104.9bn and its operating result to a profit of N1.4bn from a loss of N11.2bn. This more than compensated for weaker figures from the Nigerian Petroleum Development Company as well slightly worse numbers from the three refining companies.”

FBN Capital, however, observed that those were acceptable results in the adverse circumstances, adding that the worst of which was the shut-in of more than 300,000 barrels per day from February as a result of the sabotage of the Forcados terminal export line.

They further noted that the impact of vandalism was felt on the Bonny, Usan and Que Ibo terminals, a development that led to an average crude production of 1.65 million barrels per day in September.

The analysts said, “We can see the cost of sabotage another way. In September, output under production sharing contracts amounted to 27.7 million barrels, compared with 27.8 million barrels in October 2015.

“Over the same period, output from the corporation’s joint ventures, under alternative financing arrangements and from the NPDC declined by 9.7 million barrels, 6.1 million barrels and 1.9 million barrels, respectively.

“The January-October operating deficit of N162bn compares with N241bn in the same period of 2015. Cost control has been critical but we repeat our point that the corporation cannot become the police in the Niger Delta.”

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.

Economy

FG Launches E-ticketing Platform to Deepen Train Usage and Convenience

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FG Launches E-ticketing Platform to Deepen Train Usage and Convenience

In a bid to improve the usage and enhance the convenience of train transport in Nigeria, the Federal Government on Thursday announced the launching of the Electronic Ticketing platform for the Kaduna-Abuja rail services.

The N900 million E-ticketing platform was introduced by the Minister of Transportation, Chibuike R. Amaechi, and the Nigerian Railway Corporation.

Amaechi said the new platform would improve efficiency, promote accountability, reduce leakage and enhance economic growth, as well as save time.

The E-ticketing platform was a Public-Private Partnership project done in conjunction with Secure ID Solutions, who provide and would manage the system for 10 years in an effort to recoup its investment before the Nigerian Railway Corporation take charge.

Kofo Akinkugbe, the Chief Executive Officer, Secure ID Solutions, said as the new E-platform issued 25,000 tickets after a successful pilot test on Thursday.

Potential Travelers can book via three ways:

1. Mobile app
2. Website
3. POS or Cash at the station

A validator would be used to scan the ticket barcode to ascertain its authenticity before boarding.

Amaechi further announced that self-service ticket vending machines at various train stations would be introduced soon.

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Economy

Nigeria’s Excess Crude Account (ECA) Balance Now $72.4 Million

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Zainab Ahmed Finance Minister

Nigeria’s Excess Crude Account (ECA) Balance Now $72.4 Million

The Minister of Finance, Budget and National Planning, Zainab Ahmed, on Thursday said Nigeria’s Excess Crude Account (ECA) stood at $72,411,197.80 as of January 20th, 2021.

The minister disclosed this at the first National Economic Council (NEC) meeting of the year presided over by Yemi Osinbajo, Vice President and had in attendance State Governors, Federal Capital Territory Minister, Central Bank Governor and other senior government officials.

Ahmed said “Excess Crude Account (ECA), balance as at 20th January, 2021, $72,411,197.80; Stabilization Account, balance as at 19th January, 2021, N28,800,711,295.37; Natural Resources Development Fund Account, balance as at 19th January 2021, N95, 830,729,470.82.”

The minister also said President Muhammadu Buhari has approved N6.45 billion for the setting up of gas plants in 39 locations nationwide in an effort to increase COVID-19 treatment.

What is Excess Crude Account (ECA)

Excess Crude Account (ECA) is an account used to save the disparity in the market price of crude oil and budgeted price of crude oil as stipulated in the Federal Government Appropriation Bill.

Key Takeaways of Excess Crude Account (ECA)

  • Excess Crude Account (ECA) was established in 2004 by the Federal Government to stabilize Nigeria’s economy and smooth out the effect of crude oil fluctuation on Africa’s largest economy.
  • The ECA rose to its highest of $20 billion in November 2008 during the global oil boom when prices were above $100 per barrel.
  • Controversy, allegations of corruption, and uncertain performance have trailed the ECA since creation.
  • The balance plunged from $20 billion in 2008 to $72.4 million in January 2021.

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Economy

AfCFTA: Nigeria Customs Service Requested For Detailed Role In The Free Trade Agreement

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Container Shipping

AfCFTA: Nigeria Customs Service Requested For Detailed Role In The Free Trade Agreement

Nigeria Customs Service (NCS) requested for a proper and detailed role expected to be carried out in the implementation of the African Continental Free Trade Area (AfCFTA) agreement.

The NCS said detailed explanations of roles and responsibilities of all parties involved in the free trade agreement should be spelled out to avoid overlapping of duties and to achieve a seamless implementation of AfCFTA.

Mr. Joseph Attah the Public Relations Officer, on behalf of the Comptroller-General of the NCS, Col Hameed Ali (Rtd.), issued a statement to address the call for a detailed role of the Customs.

“Our functions are highly automated and primarily systems-driven, hence the need to methodically harvest and integrate all data associated with AfCFTA into our system for easy deployment, access, and use by the trading public.

“We, therefore, await the National Action Committee (NAC) on the list of duties and charges waived for liberalised goods under AfCFTA. The list of the 90 percent liberalised national trade offers (NTOs); list of the 70 percent non-liberalised exclusive goods at the regional level; and list of the 3 percent non-liberalised sensitive goods.

“The appointment of a competent authority responsible for issuing and authenticating certificates of origin and registering enterprises and products within the region.” He said.

In the statement, NCS pledges commitment to the success of the trade pact and also identifies the transformational impact the free trade agreement would have on businesses in Nigeria and the Africa continent at large.

“Also, it is pertinent to inform the public about steps which must be taken to enable its smooth and full implementation,” He added

NCS recommended that the member-country of the free trade agreement should have a representative in the continental chamber, this is to ensure transparency and build the confidence of the members in the system.

“This, in our view, should be complementary to the activities of the various chambers of commerce of each country in the region. While awaiting clear directives concerning tariffs for all goods covered by this agreement, we want to assure the public of our preparedness to fully deploy our services at the shortest notice.

“Our desire is to imbue trust in the system while guaranteeing the economic safety and wellbeing of businesses within the country,”  NCS noted.

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