- NLNG Revenue Hits Seven-year Low Amid Oil Slump
The Nigeria LNG Limited, the biggest gas exporter in the country, said it earned a total of $4.723bn last year, the lowest in seven years.
The company, which was created to harness the nation’s vast natural gas resources and produce Liquefied Natural Gas and Natural Gas Liquids for export, saw its revenue peak at $11.592bn in 2012.
The NLNG is owned by the Federal Government, represented by the Nigerian National Petroleum Corporation (49 per cent), Shell (25 per cent), Total LNG Nigeria Limited (15 per cent) and Eni (10.4 per cent).
Following the sharp decline in crude oil prices, the NLNG’s revenue dropped from $10.791bn in 2014 to $6.843bn in 2015.
Dividends to the NNPC plunged from $1.044bn in 2015 to $356.127m last year, the lowest in 10 years, according to the ‘Facts and Figures on NLNG 2017’ released on Wednesday.
The international oil companies got $380.959m in dividends last year, down from $1.117bn in 2015.
The Managing Director and Chief Executive Officer, NLNG, Mr. Tony Attah, while presenting the document in Lagos, noted that the company took a beating from the fall in crude oil prices in the global markets.
The NLNG stated in the report that the Fukushima incident in Japan resulted in a high demand for the LNG in Asia, creating differences in the LNG prices between Asia and other regions.
Noting that the arbitrage necessitated the movement of gas trade from regions of lower prices to those higher prices, the NLNG said it partnered its buyers to “effectively optimise their volumes for the mutual benefit of the company and buyer.”
“This opportunity has nearly disappeared since late 2015 following the fall in oil price,” the company said.
With six trains currently operational, the NLNG is capable of producing 22 million tonnes per annum of the LNG, and 5mtpa of natural gas liquids from 3.5 billion standard cubic feet per day of natural gas intake.
It said, “Plans for building Train 7 that will lift the total production capacity to 30mtpa of the LNG are currently progressing with some preliminary early site preparation work initiated. Further work awaits an FID (final investment decision) by the stakeholders.”
According to the report, the company currently manages 16 long-term LNG sale and purchase agreements executed with 10 buyers on a delivered ex-ship basis.
It said, “The long-term LNG buyers take delivery of their volumes at receiving facilities spread across the Atlantic basin in countries such as Spain, France, Portugal and Italy in Europe, Turkey, Mexico and the United States of America.”
Nigeria is blessed with abundant reserves of associated and non-associated gas, estimated to be in excess of 180 trillion cubic feet.
The country is ranked ninth in terms of proven natural gas reserves in the world, estimated to be sufficient to sustain current production rates for over 60 years, according to the NLNG.
“Geologists believe that there is a lot more gas to be found (potentially up to 600Tcf), if companies deliberately explore for gas, as opposed to finding it while in search of oil,” Attah said.
According to him, the government aims to eliminate all flaring of gas associated with the production of oil, and the NLNG continues to play a significant part in this.
He said from 1999 to 2015, the NLNG converted 5.16Tcf of associated gas to export products, which otherwise would have been flared.
“With further improvement in the collection of associated gas, the NLNG with its six-train LNG/NGL complex will reduce upstream flaring in Nigeria even further,” he said, putting its current daily consumption at about 3.5 bcf.”
Attah said the NLNG would continue to consolidate its position as one of the major and reliable suppliers of the LNG in the world.
He said, “The NLNG’s expansion plan under the proposed Trains 7 and 8 projects, which will raise the liquefaction capacity to over 30mtpa, continues to make progress towards a Final Investment Decision.”
On domestic supply of Liquefied Petroleum Gas (cooking gas), the company said its intervention had helped stabilise the price of the commodity in the country.
Attah said the NLNG was determined to increasing its supply of the LPG into the Nigerian market to 350,000 tonnes per annum from 250,000 tonnes, adding that sale and purchase agreements had been signed with Nigerian companies for lifting.
Gov Emmanuel Attracts $1.4b Fertilizer Plant to Akwa Ibom
The Governor of Akwa Ibom State, Mr. Udom Emmanuel has signed an agreement for the citing of a multi billion fertilizer plant in his State.
Governor Emmanuel was part of a Nigerian delegation led by the Minister of State for Petroleum Resources, Chief Timipre Sylva, that visited Morocco to set out the next steps of the $1.4 Bln fertilizer production plant project launched in June 2018.
The agreement between the OCP Africa, the Nigerian Sovereign Investment Authority and the Akwa Ibom State Government will birth one of the biggest investments in the fertilizer production industry worldwide.
The signing ceremony took place at the Mohammed VI Polytechnic University (UMP6).
Mr. Emmanuel signed one of the agreements of the partnership, which covers a memorandum of understanding between OCP Africa, the Akwa Ibom State in Nigeria and the NSIA on land acquisition, administrative facilitation, and common agricultural development projects in the Akwa Ibom State.
Speaking while signing the agreement, Governor Emmanuel said, “Our state is receptive to investments and we are prepared to offer the necessary support to make the project a reality.
“With a site that is suitably located to enable operational logistics and an abundance of gas resources, all that is left is for the parties to accelerate the project development process”, Mr. Udom said.
The agreement reached between the Nigerian Government and the OCP further links OCP, Mobil Producing Nigeria (MPN), the NNPC, the Gas Aggregation Company Nigeria (GACN), and the NSIA.
The two partners agreed to strengthen further their solid partnership leveraging Nigerian gas and the Moroccan phosphate.
This project will lead to a multipurpose industrial platform in Nigeria, which will use Nigerian gas and Moroccan phosphate to produce 750,000 tons of ammonia and 1 million tons of phosphate fertilizers annually by 2025.
The visit of the Nigerian delegation to Morocco takes place within the frame of the partnership sealed between OCP Group and the Nigerian Government to support and develop Nigeria’s agriculture industry.
Following the success of the first phase of Nigeria‘s Presidential Fertilizer Initiative (PFI) and the progress of the fertilizer production plant project launched in 2018 by OCP and NSIA, the Moroccan phosphates group and the Nigerian government delegation have agreed on the next steps of their joint project which is rapidly taking shape.
Several cooperation agreements were inked on Tuesday at the Mohammed VI Polytechnic University (UM6P) by OCP Africa and the Nigerian delegation. Through these deals, OCP reaffirms its unwavering support of agricultural development initiatives in Nigeria including PFI.
OCP Africa and the NSIA have agreed, inter alia, to set up a joint venture which will oversee the development of the industrial platform that will produce ammonia and fertilizers in Nigeria.
The OCP has also pledged to supply Nigerian famers with quality fertilizers adapted to the needs of their soil at competitive prices and produced locally.
ICPC Says Nigeria Loses $10bn to Illicit Financial Flows
The Independent Corrupt Practices and Other Related Offences Commission (ICPC) says Nigeria accounts for 20 per cent or 10 billion dollars (N3.8 trillion) of the estimated 50 billion dollars that Africa loses to Illicit Financial Flows (IFFs).
Chairman of ICPC, Prof. Bolaji Owasanoye, said this during a virtual meeting to review a report on IFFs in relation to tax, Mrs Azuka Ogugua, spokesperson for ICPC, said in a statement released in Abuja on Friday.
The ICPC Chairman said, “the African Union Illicit Financial Flow Report estimated that Africa is losing nearly 50 billion dollars through profit shifting by multinational corporations and about 20 per cent of this figure is from Nigeria alone.”
The ICPC boss explained that taxes played “very strategic role in the nation’s political economy.”
He said the objective of the meeting was to improve on the awareness on IFFs, especially in the areas of taxation.
The ICPC boss added that the meeting would give participants the opportunity to openly discuss how to effectively use the instrumentality of taxation to curb IFFs through risk-based approach.
“Risk-based approach, that is: monitoring and audit; due process in tax collection; structured tax amnesty framework skewed in public interest; data privacy; timely resolution of audits and payment of tax refunds and intelligence sharing among revenue generating, regulatory and law enforcement agencies,” he said.
Owasanoye also stated that for the contemporary tax man to remain relevant, he must build his capacity in areas of technology management, solution architects and an astute relationship manager.
The Executive Chairman of Federal Inland Revenue Service (FIRS) Mr Muhammad Nani, expressed concerns that IFFs posed a serious threat to the Nigerian economy as the act robbed the nation of resources that were needed for development.
Nani declared that tackling IFFs would expand the country’s tax base and improve revenue generation, which was required for development.
He consequently pushed for policy reforms that would make it difficult for “capital flights” from occurring so that the country would be placed on the path of growth.
Other discussants at the event identified weak regulatory framework, opacity of financial system and lack of capacity amongst others as some of the factors that fuelled IFFs.
The discussants emphasised the need for capacity building of relevant stakeholders as one of the ways to stamp out illicit financial flows.
They commended ICPC for leveraging its corruption prevention mandate to open a new vista in IFFs discourse in Nigeria. (NAN)
African Development Bank, Egypt Signs Agreements Worth €109 Million to Transform Sewage Coverage in Rural Areas
The African Development Bank Group has signed financing agreements of €109 million with the Government of Egypt to improve sanitation infrastructure and services for rural communities in Luxor Governorate in Egypt’s Upper Nile region.
The financing consists of a €108 million loan from the Bank, and a grant of €1 million from the Rural Water Supply and Sanitation Initiative (RWSSI) – an Africa-wide initiative hosted by the African Development Bank.
The funding, provided in a challenging global context, will help meet the Egyptian government’s financing requirements in the light of the COVID-19 pandemic, and support a sound water and sanitation infrastructure base, a key enabler for the country’s inclusive development.
The Integrated Rural Sanitation in Upper Egypt-Luxor (IRSUE-Luxor) project is set to boost sewage coverage in the region from 6% to 55%, improving the quality of life of citizens, including women and children, who are most affected by poor sanitation.
“Promoting efficient, equitable and sustainable economic development through integrated water resources management is a priority for the Government of Egypt. The IRSUE-Luxor initiative unlocks the socio-economic development potential for inclusive and green growth,” said Rania Al-Mashat, Minister of International Cooperation, who signed the agreements on behalf of the Egyptian government.
About 22,000 households (240,000 inhabitants) will benefit from on-site and off-site facilities, through an integrated system of sewerage networks, sludge treatment and wastewater treatment plants.
IRSUE-Luxor contributes to the National Rural Sanitation Program established by the Ministry of Housing, Utilities and Urban Communities, which aims to expand nationwide access to sanitation services from 34% currently to 60% in 2030.
The project also complements the national Haya Karima (Decent Life) initiative that aims to help rural communities across Egypt access essential infrastructure services to improve their living conditions and livelihoods.
Furthermore, the project includes a staff training component to strengthen performance within the Luxor Water and Wastewater Company.
“This intervention is not just about infrastructure development. An essential part of the project is supporting ongoing sector reforms,” said Malinne Blomberg, the Bank’s Deputy Director General for North Africa.
One of several initiatives supported by the African Development Bank in Egypt to optimize the use of the country’s water resources, IRSUE-Luxor will enable about 30,000 cubic meters of treated wastewater per day to be discharged into drainage and irrigation canals and re-used to enhance agricultural output.
The initiative is in line with the Bank’s water sector policy, which promotes efficient, equitable and sustainable development through integrated water resources management. In addition, the operation supports tariff regulation to achieve full cost recovery, which is one of the basic principles of the Bank’s water sector policy.
The partnership between Egypt and the African Development Bank Group dates back more than half a century. More than 100 operations have been deployed, mobilizing more than $6 billion across multiple strategic sectors.
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