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FG Begins Talks With illegal Crude Oil Refiners

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  • FG Begins Talks With illegal Crude Oil Refiners

The Federal Government on Monday announced that it had commenced discussions with illegal refiners of crude oil in order to have them work as duly recognised modular refinery operators.

It also stated that it would ensure that militancy in the Niger Delta ended by the end of this year, adding that it would sustain its engagements with stakeholders in the region in that respect.

The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, disclosed this at the 10th Nigerian Association for Energy Economics/International Association for Energy Economics Conference in Abuja.

The theme for this year’s NAEE/IAEE conference was, ‘Energy, Economy and the Environment: The Interplay of Technology, Economics and Public Policy’.

Kachikwu, who was represented by the Executive Secretary of the Petroleum Technology Development Fund, Dr. Bello Gusau, said the Federal Government was working out how to involve illegal refiners in the new modular refinery scheme.

He stated, “In the past two weeks, we have opened discussions with some of these refiners and government is assiduously working to ensure that this initiative is carefully implemented without polluting the environment.

“This will not only provide legal jobs and sources of income for the populace, but will also contribute to our national policy initiative target.”

The minister explained that the ministry’s focus was on seven key initiatives and outlined them to include the introduction of new policies that would drive the growth of the oil and gas sector.

Kachikwu said, “Number two is enabling the business environment and attracting investors. Thirdly, unleashing investment options to support forex. Number four is to improve our domestic capacity for local petroleum products’ production and attaining self-sufficiency by 2018.

“Number five is to sustain engagements with oil-producing communities and attain zero militancy in the Niger Delta region by the end of the year 2017. The sixth is to increase efficiency in the industry and automate business processes to account for every drop of oil that is produced in the country.”

He noted that the last key focus area of his ministry was to adopt a sustainable stakeholder management framework that would address the various issues and circumstances in the sector.

The minister added, “Our engagements in the Niger Delta is already yielding very significant results with the absence of any major incident on our facilities.

“A comprehensive and holistic development is currently being worked out with all stakeholders and government parastatals, including the Ministry of Petroleum Resources, Ministry of Niger Delta, the Niger Delta Development Commission, the Amnesty Office and the various state governments.”

Kachikwu further stated that the first instalment for the payment of the cash call arrears by the Federal Government to international oil companies as agreed between both parties would be done by the end of this month.

He, however, did not state the amount to be paid as the first instalment of the over $5bn debt owed the IOCs by the Federal Government.

Earlier in his address, the President, NAEE, Prof. Wumi Iledare, lauded the Federal Government’s cash call exit agreement, but cautioned that plans to fund the Joint Venture cash calls should be reviewed.

He said, “Of course, I hasten to suggest the new attempt to fund the JV cash calls should be reviewed periodically within the context of the overall goal.

“Perhaps a pseudo-Production Sharing Contract, or at best a form of overriding royalty funding arrangement is worthy of consideration in order to retain a participatory interest in the JV agreements without the obligation of cash call for energy security reason.

“What this means for the economic metrics and the government’s take requires a review of the fiscal terms such as royalty rate and capital cost recovery mechanism.”

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

AfDB, European Bank To Bridge $2.5tn Africa’s Financing Gap

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The African Development Bank Group and the European Bank for Reconstruction and Development signed a Memorandum of Understanding on Monday to promote sustainable private sector development in Africa.

In a statement issued by its Communication and External Relations Department, the AfDB said, “The MoU will help catalyse new sources of financing to help bridge the $2.5tn annual financing gap for development in Africa.

“This gap requires that development finance institutions work in partnership.”

The bank stated that under this partnership, the AfDB and the EBRD would capitalise on their respective

expertise and experience, with a particular focus on climate change, green and resilient infrastructure and capital markets development.

“They will also work on improving business environments, bolstering the real economy and mobilising private sector investment,” the AfDB stated.

It observed that COVID-19 was threatening progress made towards the United Nations Sustainable Development Goals and was exacerbating the debt vulnerability of many African countries.

The bank stated that sustainable private sector development would be key to recovery and prosperity across the continent.

AfDB’s President, Akinwumi Adesina, after signing the memorandum with his counterpart, EBRD President,

Odile Renaud-Basso, was quoted as saying, “The new partnership agreement between our two institutions will pave the way for us to do more together, especially in supporting the growth of Africa’s private sector.

“The impact of COVID-19 on government resources is huge and we need to mobilise more private resources to help African countries build back stronger.”

On his part, Renaud-Basso, said, “The COVID-19 crisis has made the need for better and ever closer collective action even more urgent.

“Collaboration between the EBRD and the African Development Bank has grown from strength to strength over the years in the region.”

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Economy

Despite Rising Debt Profile, President Buhari Seeks New N2.342T External Loan

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President Muhammadu Buhari, on Tuesday, urged the Senate to approve a new external loan of N2,343,387,942,848.00, about $6.183billion, for the Federal Government to finance the 2021 budget deficit.

Senate President Ahmad Lawan read Buhari’s letter of request on the floor of the Senate at plenary.

Last Month, Investorsking recalled that there was a controversy when Edo State Governor, Godwin Obaseki had raised concerns over the financial trouble Nigeria might find herself due to the continuous rising debt profile.

In a recent report carried out by PWC, it was reported that:

“Actual debt servicing cost in 2020 stood at N3.27 trillion and represented about 10 percent over the budgeted amount of N2.95 trillion. This puts the debt-to-revenue ratio at approximately 83 percent, nearly double the 46 percent that was budgeted.

“This implies that about N83 out of every N100 the FG earned was used to settle interest payments for outstanding domestic and foreign debts within the reference period. In 2021, the FG plans to spend N3.32 trillion to service its outstanding debt. This is slightly higher than the N2.95 trillion budgeted in 2020”.

According to DMO Nigeria’s total public debt as at December 31, 2020, was N32.915 Trillion.

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Economy

Eko Disco Engage Projects On Network Improvement And Service Delivery

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Eko Electricity Distribution Company (EKEDC) has commenced the construction and rehabilitation of its network infrastructure for improved power supply to customers.

The company, in a statement yesterday signed by its General Manager, Corporate Communication, Mr. Godwin Idemudia, the projects included the construction, reconstruction, rehabilitation, and maintenance of installations across its distribution network.

Idemudia revealed that the projects once completed, would help the company achieve among other things, network improvement, increase reliability and quality of supply, allow flexibility for evacuation of additional power, address safety issues and relieve overloaded transformers and substations.

He listed some of the projects like the construction and rehabilitation of eight injection substations, explaining that projects that fell under this category include the upgrade of Keffi substation, reactivation of NTDA injection substation, Ajah.

Others are the upgrade of the Ajah Local substation, construction of a new Surulere injection sub-station, upgrade of Trade Fair injection substation, construction of Olugborogun injection substation, Lekki, replacement of failed power transformer at Agbara Injection substation, and upgrade of Agungi station for higher capacity.

Idemudia added that the Eko Disco was also projected to procure 217 500KVA transformers which would be distributed across its 10 districts.

“During the same period, the company has also committed to the construction of five new 33kv feeders that will cut across areas like Surulere, Festac, Ojo and Lekki, while 24 33kv feeders at Ikoyi, Lekki, Ibeju, Elemoro, Eleko, Apapa, Orile, FESTAC and Agbara will be rehabilitated.

“About five new 11kv feeders are expected to be deployed to Lekki, Ajah and Ojo to relieve overloaded feeders, while a total of 167 11kv feeders will be rehabilitated across our distribution network,” he said.

Idemudia noted that the implementation of the projects was a demonstration of the company’s commitment to service excellence and fulfill its promise of reliable and consistent supply to its customers.

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