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Nigeria Oil and Gas Provide Investments in Excess of $50bn – Kachikwu

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  • Nigeria Oil and Gas Provide Investments in Excess of $50bn

Minister of State for Petroleum Resources, Dr Ibe Kachikwu, said economic growth plan recently launched by Federal Government would provide strategic and economic partnerships in excess of $50bn.

Kachikwu said this on Tuesday while wooing investors at an event organised in Houston, U.S., by the Nigerian Content Development and Monitoring Board.

He said, “The Federal Government of Nigeria has launched a National Economic and Growth Plan for the next four years. This is anchored on the Nigeria Oil and Gas Roadmap among other sectoral roadmaps.

“This roadmap presents exciting opportunities for financial and strategic partnerships in excess of $50bn (about N1.58 trillion).

“About $13bn -$17bn will go to the upstream for the development of upstream gas fields with a total of 37.4 trillion cubic feet.

“$14bn -$17bn will go to the Trans-Nigeria gas pipeline project, gas revolution industrial park at Ogidigben and three power plants for additional 3.2 GW capacity in the gas and power sector”.

He added that $2.5bn – $5bn will be invested in licensing and establishment of modular refineries, collocate refinery within Kaduna Refining and Petrochemical Company and rehabilitating/upgrading the three refineries.

“In the downstream sector, about $3bn – $3.9bn will go to revamping of liquefied petroleum gas, building of new Compressed Natural Gas plants across the country and to pipeline and storage tank constructions.

“In addition, $0.7bn – $1bn will be invested in ventures such as equipment leasing, development of multi-specialist hospital and cancer diagnostic and treatment centres,” he stated.

Kachikwu assured investors on President Muhammadu Buhari’s stance that he would ensure that under his watch, the “old’’ Nigeria would slowly disappear while a new era would arise.

He also assured them of security and the new ease of doing business in Nigeria, adding that government had made progress on reforms in the sector.

“Part of progress made are the new policies and regulations like the new oil, gas and fiscal policies that are being developed and syndicated with all stakeholders and the Petroleum Industry Governance Bill.

“The Bill will be passed by National Assembly before the end of the second quarter.

“It also includes business environment and investment drive, gas revolution including the gas flare commercialisation programme where investors are invited to submit detailed project proposals by end of May.

“Private sector-led revamp for refineries being pursued and framework for new Greenfield refineries, including modular refineries in place, and Niger Delta security and transparency and efficiency,” he said.

The minister said that the outcome of the meeting would be aligned to projects and funding opportunities, preliminary discussion on areas of potential collaboration and broad alignment on funding options.

The Executive Secretary of the NCDMB, Mr Simbi Wabote, in his address said that his desire was not to hold events but “to follow through on whatever decisions are made from such meetings to ensure development eventually”.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Nigerian VIPs Pour Nearly N1.49 Trillion into Dubai Property Market

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General Images Of Residential Property

It has been uncovered that Nigerian politicians, security officials, and their families have collectively invested close to N1.49 trillion in the Dubai property market over the past two decades.

This massive investment spree spans 1,600 properties located in some of Dubai’s most exclusive and sought-after neighborhoods.

The investigation, named ‘Dubai Unlocked,’ conducted over six months by the Organized Crime and Corruption Reporting Project (OCCRP) in collaboration with Economy Post and other international media partners, has shed light on the extent of Nigerian elites’ financial footprint in the UAE’s commercial capital.

The investigation outlined the property holdings of these individuals, revealing an estimated total value approaching $1 billion.

As of 2020, Nigerian politically exposed persons (PEPs) and their associates owned around 800 properties valued at $400 million.

However, recent findings indicate a significant surge, with the number of properties doubling and their collective value nearing the N1.49 trillion mark.

The vast majority of these properties, amounting to 88%, are reportedly owned by individuals with ties to Nigeria’s government and security apparatus.

Prominent figures implicated in this expansive real estate portfolio include former Vice President Atiku Abubakar, whose family owns multiple high-end apartments and villas across prestigious locations such as Palm Jumeirah and Burj Khalifa.

Similarly, other former governors, senators, and high-ranking civil servants have been linked to luxury residences in Dubai, raising questions about the source of funds used for these acquisitions.

Critics argue that while there may be legitimate reasons for acquiring property abroad, such vast investments raise concerns about capital flight and the origins of the funds involved.

Emmanuel Okeke, a legal expert, highlighted the distinction between lawful investments and potential financial misconduct, emphasizing the need for transparency and accountability in wealth acquisition by public officials.

The Dubai property market, renowned for its growth and stability, continues to attract global investors, with residential property prices rising by over 20% in the first quarter of 2024 alone.

Despite international scrutiny and calls for regulatory reforms to curb illicit financial flows, Dubai remains a favored destination for wealthy individuals seeking to diversify their assets.

Authorities in Nigeria and international organizations such as C4ADS have underscored the importance of ensuring that investments in foreign real estate are conducted ethically and in compliance with anti-money laundering regulations.

The spotlight on Nigerian VIPs’ extensive property holdings in Dubai serves as a stark reminder of the challenges posed by globalized financial activities and the imperative to safeguard against corruption and illicit wealth accumulation.

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Investors Scramble as Nvidia’s Sales Defy Projections in AI Surge

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Nvidia Corp., the renowned chipmaker, defies sales projections driven by an unprecedented boom in artificial intelligence (AI).

This surge has propelled Nvidia to become the most expensive stock in the S&P 500 Index, with shares trading at roughly 23 times the company’s projected sales over the next 12 months.

For more than a year, Nvidia has experienced a meteoric rise in demand for its chips, fueled by the frenzy surrounding AI advancements.

This demand has rendered traditional financial estimates obsolete, leaving even Nvidia’s executives struggling to accurately predict the company’s future revenue.

Since the chipmaker’s sales began skyrocketing in the fiscal quarter ending April 2023, revenue has consistently exceeded company forecasts by an average of 13%, a figure more than double the average over the past decade.

The most notable instance occurred in August, when Nvidia’s sales surpassed its projections by an astounding 23%, marking the biggest beat since at least 2013.

A representative for Nvidia declined to comment on the company’s revenue projections and the challenges in forecasting amidst the AI boom.

The challenge of modeling Nvidia’s future earnings lies largely in the unpredictability of supply amid surging demand.

Brian Colello, an analyst at Morningstar, highlighted this issue, noting that Nvidia’s situation is unique.

“Assuming steady improvement in Nvidia’s ability to increase supply, I add up to $4 billion to Nvidia’s quarterly revenue to ballpark the upcoming quarter’s sales,” Colello explained.

He recently raised his price target for Nvidia shares to $105 from $91, though they are currently trading around $127.

Colello is not alone in his optimistic adjustments. Ben Reitzes, an analyst at Melius, has raised his price target on Nvidia five times this year, most recently to $160, implying a 26% gain from recent closing prices.

The market’s enthusiasm is evident as Nvidia’s stock has surged 156% this year, briefly overtaking Microsoft Corp. to become the world’s most valuable company at $3.34 trillion.

This rally has contributed to a record $8.7 billion inflow into tech funds last week, according to Bank of America Corp.’s analysis of EPFR Global data.

However, Nvidia shares have since fallen 6.7%, erasing over $200 billion in market value.

For investors relying on discounted cash flow models, the gap between estimates and actual results has created a conundrum.

In the past five quarters, analyst estimates for Nvidia’s sales have deviated from actual results by an average of 12%, the third-highest among S&P 500 companies with average quarterly revenues exceeding $5 billion.

Despite the challenges in forecasting, Nvidia’s growth remains impressive. The company is projected to deliver a profit of $14.7 billion on sales of $28.4 billion in the current quarter, reflecting increases of 137% and 111%, respectively, from the same period a year ago.

Comparatively, Microsoft’s sales are expected to rise 15%, with Apple’s projections sitting around 3%.

While Nvidia’s valuation multiples are high, they appear more reasonable considering the company’s growth trajectory.

However, Michael O’Rourke, chief market strategist at Jonestrading, cautions that the extent of Nvidia’s outperformance may diminish due to its sheer size, potentially making it harder to justify the current stock price.

“That’s where the risk comes in,” O’Rourke said. “You’re paying a high price for a large market cap company where the beats have been trending lower, and that’s likely to continue.”

As Nvidia continues to navigate the unpredictable waters of the AI surge, investors and analysts alike are left grappling with the challenge of accurately predicting the company’s future in an era of unprecedented technological advancement.

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NNPC and TotalEnergies to Invest $550 Million in Rivers State Gas Facility

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The Nigerian National Petroleum Corporation (NNPC) Ltd and TotalEnergies have announced a joint investment of $550 million in a new gas processing facility in Rivers State.

The project aims to enhance gas exports and boost domestic supplies, a source within NNPC revealed on Wednesday.

The planned investment encompasses the construction of a state-of-the-art gas processing plant and an extensive pipeline network.

The facility will be situated on the Ubeta onshore gas field, which is co-owned by TotalEnergies and NNPC.

The gas processed at this facility will be supplied to the Nigeria Liquefied Natural Gas (NLNG) plant, a consortium involving NNPC, Shell, TotalEnergies, and Italy’s Eni.

Upon completion, the Ubeta gas processing plant is expected to produce 350 million standard cubic feet of gas per day, alongside 10,000 barrels of associated liquids daily.

This development comes as Nigeria seeks to capitalize on its vast natural gas reserves, estimated at over 200 trillion cubic feet, which remain largely untapped due to inadequate processing infrastructure and capital limitations.

An official announcement regarding the investment is anticipated later this week. Although TotalEnergies has declined to comment, sources close to the agreement confirm that the project reflects a renewed effort by President Bola Tinubu’s administration to attract substantial investment into Nigeria’s energy sector.

“This investment is a clear indication of confidence in Nigeria’s resource potential and the government’s commitment to improving the ease of doing business,” commented Clementine Wallop, Director for Sub-Saharan Africa at political risk consultancy Horizon Engage.

The initiative also aligns with Nigeria’s strategic goals to increase its gas exports, especially to the European Union, which has been seeking alternative energy sources in the wake of reduced imports from Russia due to the ongoing conflict in Ukraine.

Domestically, the project is expected to alleviate some of the supply issues faced by Nigeria’s gas power plants, which are crucial for the country’s electricity generation.

Energy analysts highlight that this project could signify a turning point for Nigeria’s energy landscape, offering a much-needed boost to the country’s economic stability and energy security.

As Nigeria continues to grapple with the challenges of gas flaring and underutilization of its natural gas reserves, the NNPC and TotalEnergies’ investment in the Rivers State gas facility represents a strategic step forward in addressing these longstanding issues.

The successful implementation of this project could pave the way for further investments and advancements in Nigeria’s energy sector.

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