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IBEDC Needs N60bn for Metering



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  • IBEDC Needs N60bn for Metering

Ibadan Electricity Distribution Company has said it needs between N30bn and N60bn to supply one million meters to its customers, decrying the non-payment for electricity supplied to government’s ministries, departments and agencies.

The IBEDC, which put the MDA debts at N8.13bn, said the Nigerian Electricity Regulatory Commission should prevail on the government to adjust the MDAs’ debts for inflation and settle promptly.

The Managing Director, IBEDC, Mr. John Donnachie, listed inherited fragile network, vandalism and energy theft, and as well as non-payment of bills/delayed payments by customers as some of the challenges facing the company.

He said the company had only been able to receive about 50 per cent of the 720 megawatts allocated to it.

“In January, we had four total blackouts. Ten per cent of what is generated is lost in transit. We lost N2.6bn in January alone for bills; and N4.7bn in total in 2016,” he said.

He described the recently introduced floating exchange rate regime and the resultant depreciation in the naira value against forex as a huge challenge “because over 80 per cent of our business is dependent on forex”.

Donnachie said, “We have not been able to pass forex losses to customers. There are 6.2 million registered users in the country; the IBEDC has about 1.5 million. We can’t get forex from the Central Bank of Nigeria at official rate.

“To purchase meters and transformers, vendors’ selling prices now reflect current forex rates as access to foreign exchange is mostly through parallel markets. Tariff is not yet cost-reflective as forex component in Multi-Year Tariff Order is still N198/dollar.”

He said the IBEDC had completed metering of all identified Maximum Demand customers, thereby delivering on NERC’s deadline of February 28, 2017.

He said, “About 189,339 meters have been installed for the MD and non-MD customers from November 2013 to January 2017. We carried out energy audit, replacement of faulty/obsolete meters and metering of premium customers for revenue generation.”

According to him, the company’s strategic initiatives include the rehabilitation and upgrade of 550 injection substations; metering of 112,210 customers in 2017; deployment of statistical meters on all distribution transformers and the installation of check meters for customers on 132kV line, and technical audit, asset mapping and customer enumeration.

Donnachie described the Federal Executive Council’s approval of N701bn power purchase guarantee as a step in the right direction.

He said, “But more needs to be done as this does not mean the debts of distribution companies and other stakeholders have been wiped off.

“We recommend that dealing with vendors/suppliers, contracts should be denominated in naira using fixed exchange rate; supply should be negotiated in bulk (six to 12 months’ requirement) using an agreed price; negotiate payment holidays upfront; ring-fence projects to ensure viability.”

He said part-delivery of contract quantity should be made as at when needed; contract payment should be structured for cash flow convenience and at a fixed rate, and forward contract options to finance capital expenditure should be explored.

Meanwhile, the company announced on Wednesday that it had attracted $400m investment from Trans Sahara Consortium that would ensure installation of smart meters, infrastructure upgrade within the distribution area of the company, tackle energy theft, which was a huge revenue drain in the sector.

The Chairman, IBEDC, Dr. Tunde Ayeni, disclosed this when he signed a Memorandum of Understanding with the Trans Sahara Consortium led by Senator Saminu Turaki, according to a statement.

Turaki stated that the investment would create over 250,000 jobs in the long run, and “it is in line with the initiative of the current administration of President Muhammadu Buhari and Vice-President Yemi Osinbajo to create two million jobs.”

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


Global Markets Near Record Peaks and Will Get Stronger: deVere CEO




As the FTSE 100 hits 7,000 points for the first time since the Covid pandemic, global stock markets are poised to “get even stronger”, says the CEO of one of the world’s largest independent financial advisory and fintech organisations.

The observation from Nigel Green, the chief executive and founder of deVere Group, comes as London’s index jumped over the important threshold in early trading in London, gaining over 0.5% to 7024 points.

Mr Green notes: “London’s blue-chip index is up 40% since the worst lows of the pandemic.

“This landmark moment represents the wider optimistic sentiment gripping global markets which are near record peaks.

“We can expect global stock markets to get even stronger as investors look to seize the opportunities from economies reopening.

“They are looking towards economies rebounding in a post-pandemic era due to the monetary and fiscal stimulus, pent-up cash and demand, and strong corporate earnings.

“The current ultra-low interest rate environment and the under-performance of bonds will also act as a catalyst for stock markets.”

However, the CEO’s bullish comments also come with a warning.

“I would urge investors to proceed with caution as there are some headwinds on the horizon, including relations between the U.S. and China, the world’s two largest economies, which could be coming to a tipping point in coming weeks.

“As such, in order to capitalise on the opportunities and mitigate risks, investors must ensure proper portfolio diversification.”

Mr Green concludes: “A variety of factors are going to drive global stock markets. Investors will not want to miss out and should work with a good fund manager to judiciously top-up their portfolios.”

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Refinitiv Expands Economic Data Coverage Across Africa



Building on its commitment to drive positive change through its data and insights, Refinitiv today announced the expansion of its economic data coverage of Africa. The new data set allows investment managers, central bankers, economists, and research teams to use Refinitiv Datasteam analytical data for detailed exploration of economic relationships and investment opportunities among data series covering the African continent.

Securing reliable, detailed, timely, locally sourced content has not been easy for economists who have in the past had to use international sources which often can take many months to update and opportunities to monitor the market can be missed. Because Africa is a diverse continent, economists and strategists need more timely access to country-specific data via national sources to create tailored business, policy, trading and investment strategies to meet specific goals.

Africa continues to develop critical infrastructure, telecommunications, digital technology and access to financial services for its 1.3bn people. The World Bank estimates that over 50% of African inhabitants will be under 25 by 2050. This presents substantial opportunities for investors who can spot important trends and make informed decisions based on robust and timely economic data.

Stuart Brown, Group Head of Enterprise Data Solutions, Refinitiv, said: “Africa’s growing, dynamic and fast evolving economies makes it a focal point for financial markets today and in the coming decades.  As part of LSEG’s commitment to empowering the global markets with accurate and timely data, we are excited about making these unique datasets available via the Refinitiv Data Platform. Our economic data coverage of Africa will provide our customers with deeper and broader inputs for macroeconomic analyses and enable more effective investment strategies and economic research.”

Refinitiv Africa economic data coverage:

  • Africa economics content comprises around 500,000 nationally sourced time series data covering 54 African nations
  • Content is sourced from national statistical offices, central banks and other key national institutions
  • The full breadth of economics categories in Datastream including national accounts, money and finance, prices, surveys, labor market, consumer, industry, government and external sectors
  • International sources including OECD, World Bank, IMF, African Development Bank, Oxford Economics & more provide comparable data & forecasts across the continent

Refinitiv® Datastream® has global macroeconomics coverage to analyze virtually any macro environment, and better understand economic cycles to uncover trends and forecast market conditions. With over 14.2 million economic times series map trends, customers can validate ideas and identify opportunities using Refinitiv Datastream. Access its powerful charting tools, 9,000 pre-built chart templates and chart studies for commonly used valuation, performance, and technical and fundamental analysis.

 Refinitiv continually grows available data – the China expansion in 2019 covered a unique combination of economic and financial indicators. Refinitiv plans to expand Southeast Asia covering Thailand, Vietnam, Philippines and Malaysia with delivery expected in 2021. This ensures that Refinitiv will have much needed emerging market economic content.

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Crude Oil

Oil Rises on Drawdown in U.S. Oil Stocks, OPEC Demand Outlook



Oil 1

Oil prices rose in early trade on Wednesday, adding to overnight gains, after industry data showed U.S. oil inventories declined more than expected and OPEC raised its outlook for oil demand.

Brent crude futures rose 28 cents, or 0.4%, to $63.95 a barrel at 0057 GMT, after climbing 39 cents on Tuesday.

U.S. West Texas Intermediate (WTI) crude futures similarly climbed 28 cents, or 0.5%, to $60.46 a barrel, adding to Tuesday’s rise of 48 cents.

Oil price gains over the past week have been underpinned by signs of a strong economic recovery in China and the United States, but have been capped by concerns over stalled vaccine rollouts worldwide and soaring COVID-19 infections in India and Brazil.

Nevertheless, the Organization of the Petroleum Exporting Countries (OPEC) tweaked up its forecast on Tuesday for world oil demand growth this year, now expecting demand to rise by 5.95 million barrels per day (bpd) in 2021, up by 70,000 bpd from its forecast last month. It is banking on the pandemic to subside and travel curbs to be eased.

“It was a welcome prognosis by the market, which had been fretting about the impact the ongoing pandemic was having on demand,” ANZ Research analysts said in a note.

Further supporting the market on Wednesday, sources said data from the American Petroleum Institute showed crude stocks fell by 3.6 million barrels in the week ended April 9, compared with estimates for a decline of about 2.9 million barrels from analysts polled by Reuters.

Traders are waiting to see if official inventory data from the U.S. Energy Information Administration (EIA) on Wednesday matches that view.

Market gains are being capped on concerns about increased oil production in the United States and rising supply from Iran at a time when OPEC and its allies, together called OPEC+, are set to bring on more supply from May.

“They may have to contend with rising U.S. supply,” ANZ analysts said.

EIA said this week oil output from seven major shale formations is expected to rise by 13,000 bpd in May to 7.61 million bpd.

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