- Electricity Generation Rises to 4,303MW
Electricity generation yesterday rose to 4,232.6 Megawatts (MW), an appreciable improvement from the 3,500 MW recorded in the last two months, according to the daily electricity generation report from the Transmission Company of Nigeria (TCN).
The Federal Government’s efforts to fix the electricity crisis in Nigeria have not yielded significant result due to gas pipeline vandalism and many homes and businesses are still experiencing constant blackout.
According to the operational report from the TCN, this can be regarded as significant improvement; although still far below the country’s peak demand forecast of 19,100MW.
Also, analysis from the Nigerian Electricity Supply Industry (NESI) Statistics showed that the power sector lost an estimated N1.2 billion on March 20, due to gas constraints.
Specifically, the agency put power output loss to gas constraints at 2,105MW.
It stated: “The power sector is plagued with structural issues in all key areas – generation, gas supply, transmission and distribution. To name a few of these challenges, the operational capacity of the country’s power plants is less than a third of their installed capacity.
“Chronic vandalism has crippled oil and gas pipelines, creating gas shortages at power plants. Underinvestment in maintenance and infrastructure has constrained our transmission grid. Finally, high collection and commercial losses have impacted the financial viability of the privatised distribution companies.”
Despite the output improvement in, many customers under the Ikeja Electric Plc, complain that there is no corresponding increase in supply.
Responding to the irregular supply under its jurisdiction, Spokesperson for the company, Olusola Ayeni, attributed this to line damage, saying: “The current outage is due to the destruction of our Abule Tailor 33kv line, Ipaja 11kv line and Amikanle 11kv line by the heavy rain last night.
“The affected areas include Ikola, Amikanle, Command Road Ipaja, Olota, Ekoro Road, Abule Tailor and environs. Power supply to the affected areas will be restored shortly as maintenance teams are already effecting repairs.”
Dwelling on TCN’s efforts to boost power supply in Lagos, the Company General Manager, Public Affairs, Seun Olagunju, said power supply in Lagos and Ogun states is set to improve with the inauguration of some power equipment at the 330kV Transmission Substation in Ayobo, Lagos State.
She said: “The power transmission equipment to be installed include transformers, protective devices, metering circuits as well as state-of- the- art control panels, which will facilitate the wheeling of more reliable power to the distribution companies and the people.
“As a result of the volume of connections to be done, and the need to reduce attendant customer discomfort, the installation has been spread to take effect from March 6 to April 3rd, and only between 9am and 3pm daily.”
She assured that the installations are geared towards providing more quality power supply to the people.
Speaking on the state of electricity supply in the country, Senior Vice President, Centre for Values in Leadership (CVL), Rasheed Adegbenro, argued that Nigeria couldn’t be industrialised without regular electricity supply, and as such, cannot be competitive even in the next 20 years with the level of electricity supply in the country.
He said: “If you have television, refrigerator and air conditioner at home, you are consuming the energy of 100 people. There is no way we can run industrialisation on a per capita consumption of 13 watts.
“Also, the telecommunication companies are struggling with providing self-generated power for their transmission networks. When they realised there was no power after acquiring the assets, they quickly mobilised funds from international financiers to remain in business.
“Discos and Gencos are challenged because the money is not there. Those who took money from the banks cannot pay back and the banks are not ready to release more funds for the electricity firms.”
Corroborating Adengbenro, President, Nigeria -Vietnam Chamber of Commerce and Industry, Oye Akinsemoyin, believes that government’s solutions to the electricity challenges have not been effective.
“I think government needs a new cabinet to manage the challenges of electricity in Nigeria. My chamber spends so much on self-generated power despite paying so much on estimated bills.”
Oil Firms Borrowed N130B From Banks in February – CBN
Operators in the downstream, natural gas and crude oil refining sectors of the Nigerian oil and gas industry borrowed N130b from Nigerian banks in February amid the significant rise in global crude oil prices.
The debt owed by the oil and gas companies rose to N4.05tn in February from N3.92bn in January, according to the latest data obtained from the Central Bank of Nigeria on Monday.
Operators in the upstream and services subsectors owed banks N1.26tn in February, down from N1.27tn a month earlier.
The combined debt of N5.31tn owed by oil and gas operators as of February 2021 represents 25.29 percent of the N21tn loans advanced to the private sector by the banks, according to the sectoral analysis by the CBN of deposit money banks’ credit.
Oil and gas firms received the biggest share of the credit from the deposit money banks to the private sector.
The slump in oil prices in 2020 as a result of the coronavirus pandemic hit many oil and gas companies hard, forcing them to slash their capital budgets and suspend some projects.
A global credit rating agency, Moody’s Investors Service, said last month that the outlook for Nigeria’s banking system remains negative, reflecting expectations of rising asset risk and weakening government support capacity over the next 12 to 18 months.
“Nigerian banks’ loan quality will weaken in 2021 as coronavirus support measures implemented by the government and central bank last year, including the loan repayment holiday, are unwound,” said Peter Mushangwe, an analyst at Moody’s.
The rating agency estimated that between 40 percent and 45 percent of banking loans were restructured in 2020, easing pressure on borrowers following the outbreak of the pandemic.
Another global credit rating agency, Fitch Ratings, had noted in a December 8 report that Nigerian bank asset quality had historically fallen with oil prices, with the oil sector representing 28 percent of loans at the end of the first half of 2020.
It said the upstream and midstream segments (nearly seven percent of gross loans) had been particularly affected by low oil prices and production cuts.
“However, the sector has performed better than expected since the start of the crisis, limiting the rise in credit losses this year due to a combination of debt relief afforded to customers, a stabilisation in oil prices, the hedging of financial exposures and the widespread restructuring of loans to the sector following the 2015 crisis,” it said.
The rating agency predicted that Nigerian bank asset quality would weaken over the next 12 to 18 months.
Fall in Economic Activities in Nigeria Created N485.51 Billion Fiscal Deficit in January -CBN
The drop in economic activities in Africa’s largest economy Nigeria led to a N485.51 billion fiscal deficit in January, according to the latest data from the Central Bank of Nigeria (CBN).
In the monthly economic report released on Friday by the apex bank, the weak revenue performance in January 2021 was due to the decline in non-oil receipts following the lingering negative effects of COVID-19 pandemic on business activities and the resultant shortfall in tax revenues.
In part, the report read, “Federally collected revenue in January 2021 was N807.54bn.
“This was 4.6 per cent below the provisional budget benchmark and 12.8 per cent lower than the collection in the corresponding period of 2020.
“Oil and non-oil revenue constituted 45.4 per cent and 54.6 per cent of the total collection respectively. The modest rebound in crude oil prices in the preceding three months enhanced the contribution of oil revenue to total revenue, relative to the budget benchmark.
“Non-oil revenue sources underperformed, owing to the shortfalls in collections from VAT, corporate tax, and FGN independent revenue sources.
“Retained revenue of the Federal Government of Nigeria was lower-than-trend due to the lingering effects of the COVID-19 pandemic.”
“At N285.26bn, FGN’s retained revenue fell short of its programmed benchmark and collections in January 2020, by 41.3 per cent and 7.5 per cent respectively.
“In contrast, the provisional aggregate expenditure of the FGN rose from N717.6bn in December 2020 to N770.77bn in the reporting period, but remained 14.4 per cent below the monthly target of N900.88bn.
“Fiscal operations of the FGN in January 2021 resulted in a tentative overall deficit of N485.51bn.”
The report noted that Nigeria’s total public debt stood at N28.03 trillion as of the end-September 2020, with domestic and external debts accounting for 56.5 percent and 43.5 percent, respectively.
NNPC Supplies 1.44 Billion Litres of Petrol in January 2021
The Nigerian National Petroleum Corporation (NNPC) supplied a total of 1.44 billion litres of Premium Motor Spirit popularly known as petrol in January 2021.
The corporation disclosed in its latest Monthly Financial and Operations Report (MFOR) for the month of January.
NNPC said the 1.44 billion litres translate to 46.30 million litres per day.
Also, a total of 223.55Billion Cubic Feet (BCF) of natural gas was produced in the month of January 2021, translating to an average daily production of 7,220.22 Million Standard Cubic Feet per Day (mmscfd).
The 223.55BCF gas production figure also represents a 4.79% increase over output in December 2020.
Also, the daily average natural gas supply to gas power plants increased by 2.38 percent to 836mmscfd, equivalent to power generation of 3,415MW.
For the period of January 2020 to January 2021, a total of 2,973.01BCF of gas was produced representing an average daily production of 7,585.78 mmscfd during the period.
Period-to-date Production from Joint Ventures (JVs), Production Sharing Contracts (PSCs) and Nigerian Petroleum Development Company (NPDC) contributed about 65.20%, 19.97 percent and 14.83 percent respectively to the total national gas production.
Out of the total gas output in January 2021, a total of 149.24BCF of gas was commercialized consisting of 44.29BCF and 104.95BCF for the domestic and export markets respectively.
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