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NNPC Vows to Sustain Products Supply Despite Downstream Sector Challenges

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NNPC - Investors King
  • NNPC Vows to Sustain Products Supply Despite Downstream Sector Challenges

The Nigerian National Petroleum Corporation (NNPC) on Tuesday said it would continue to supply petroleum products to all parts of Nigeria despite challenges in the downstream petroleum sector.

According to a statement in Abuja, the corporation’s Group Managing Director, Dr. Maikanti Baru, stated this at the end of a combined three editions of the annual general meetings of its downstream subsidiaries, the Nigerian Products Marketing Company (NPMC) and the Nigerian Pipelines and Storage Company (NPSC).

The statement was signed by NNPC’s Group General Manager, Public Affairs, Mr. Ndu Ughamadu. It quoted Baru to have said the two companies have done well with their operations under the circumstances in which they found themselves.

He noted that amid upheavals in products pricing and the intrigues among players in the industry, the NPMC and NPSC have ensured an unimpeded petroleum products supply in the country.

For a while now, the NNPC has remained the sole importer and supplier of petroleum products in the country, particularly petrol. This development has been supported by other marketers’ challenges with getting foreign exchange to embark on products importation, as well as reported arrears of subsidy debts owed the marketers by the government which they claim has impeded their capacities to trade.

Baru however, said in the statement: “The NPMC and NPSC are the sole vehicles through which the NNPC is currently satisfying its obligation of being the supplier of last resort to the nation. We have ensured that we sustain the steady supply of petroleum products across the country and we are doing this onerous task with integrity.”

He further explained that the splitting of Pipelines and Products Marketing Company Limited (PPMC) into NPMC and NPSC was to commercialise the operations of the company for the better.

According to him, the federal government and the NNPC had put in place strategies to engage various host communities to stem incidences of pipeline infractions. This efforts, he added has begun to yield positive results.

The statement also noted that external auditors of the companies, Messrs PricewaterhouseCoopers, gave them a clean bill of health, stressing that their financial statement and operations complied with international best practices.

NNPC also stated that the recent strategic intervention it initiated led to a 42 per cent fall in the price of diesel in the country. It added that the reported downward trend has remained in place across the country.

It said it has also taken steps to resuscitate some of its critical pipelines and depots such as the Atlas Cove – Mosimi Depot Pipeline; Port Harcourt Refinery – Aba Depot Pipeline; Kaduna – Kano Pipeline; and the Kano Depot which it said have enhanced efficiency in the distribution of diesel.

NNPC maintained that efforts were ongoing to revamp and re-commission other critical pipelines and depots across the country.

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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Economy

Nigeria’s Plan to Review Oil Companies’ Gas Flaring Strategies

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Oil

Nigeria is ramping up its efforts to address environmental concerns in the oil and gas sector with a comprehensive plan to review gas flaring strategies of international and indigenous oil companies.

The Minister of State for Environment, Dr. Iziaq Salako, announced this initiative during a national stakeholders engagement meeting on methane mitigation and reduction held in Abuja, Investors King reports.

Gas flaring, a common practice in the oil industry, releases methane—a potent greenhouse gas—into the atmosphere, contributing to climate change and posing health risks to communities near oil facilities.

Nigeria aims to end routine gas flaring by 2030, aligning with global climate goals and commitments.

Dr. Salako explained the importance of reducing methane emissions and highlighted the detrimental effects on public health, food security, and economic development.

He outlined practical steps being taken to tackle methane emissions, including the development of methane guidelines and the engagement of government institutions.

The ministry, through the National Oil Spill Detection and Response Agency, will conduct periodic reviews of oil companies’ plans to ensure compliance with the gas flaring deadline.

Deloitte management consultants will assist in conducting comprehensive forensic audits to scrutinize the legitimacy of forward-contracted transactions.

President Bola Tinubu’s commitment to environmental sustainability underscores the government’s dedication to addressing climate change and fulfilling its multilateral environmental agreements.

The engagement event served as a platform for stakeholders to discuss methane mitigation strategies, existing policies, and implementation challenges.

Collaboration and dialogue among diverse sectors are crucial in charting a unified course towards sustainable methane reduction in Nigeria’s oil and gas industry.

As the country navigates its environmental agenda, ensuring accountability and transparency in gas flaring practices remains paramount for achieving a greener and healthier future.

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Economy

Interest Rate Jumps to 24.75% as CBN Takes Aggressive Stance Against Inflation

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Dr. Olayemi Michael Cardoso

The Central Bank of Nigeria (CBN) has announced a significant increase in the monetary policy rate, known as the interest rate, to 24.75%.

This move disclosed by CBN Governor Olayemi Cardoso during the 294th Meeting of the Monetary Policy Committee press briefing in Abuja, represents a bold step by the apex bank to address the mounting inflationary pressures faced by the country.

With inflation soaring to 31.70% in February, the CBN aims to moderate this upward trend by tightening its monetary policy stance.

This decision follows the previous hike in the interest rate to 22.75% in February, showcasing the CBN’s commitment to combatting inflationary forces.

While the bank opted to maintain the Cash Reserve Ratio at 45%, the significant increase in the interest rate underscores the urgency of the situation and the need for decisive action.

Governor Cardoso emphasized that these measures are essential to stabilize the economy and safeguard the purchasing power of the Nigerian currency.

The 294th MPC marks the second meeting under Governor Cardoso’s leadership, indicating a proactive approach to addressing economic challenges.

The next MPC meeting is scheduled for May 20th and 21st, 2024, highlighting the ongoing commitment of the CBN to navigate Nigeria’s economic landscape amidst inflationary pressures.

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Economy

Nigeria Braces for 10th Consecutive Interest Rate Hike by Central Bank

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Central Bank of Nigeria (CBN)

As Nigeria grapples with persistently high inflation, the Central Bank of Nigeria (CBN) is gearing up to implement its tenth consecutive interest rate hike in a bid to curb the soaring prices and attract investment.

Analysts surveyed by Bloomberg are anticipating a substantial 125 basis-point increase in the key rate to 24%, marking one of the most significant adjustments in the current tightening cycle.

The decision, expected to be announced by Governor Olayemi Cardoso on Tuesday at 2 p.m. in Abuja, comes on the heels of inflation accelerating to 31.7% in February, far surpassing the central bank’s target range of 9%.

This surge has been primarily attributed to the sharp depreciation of the naira, prompting authorities to devalue the currency twice since June to narrow the gap with the unofficial market rate and encourage investor confidence.

While these measures have seen the naira strengthen in recent days and bolstered investment inflows, including a fourfold increase in overseas remittances and significant foreign investor portfolio asset purchases, there remains a palpable need for more decisive action.

Giulia Pellegrini, a senior portfolio manager at Allianz Global Investors, emphasized the necessity for the CBN to intensify its tightening efforts to regain foreign investors’ confidence in the local bond market.

While acknowledging the positive strides made by the central bank, Pellegrini stressed the importance of a more assertive approach to prevent the diversion of investor attention to other frontier markets.

As the Nigerian economy navigates through these challenging times, the impending interest rate hike signals the CBN’s determination to address inflation head-on and foster a more stable economic environment.

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