Connect with us

Markets

Floods: Lekki, VI May Lose Attraction, Say Experts

Published

on

lekki
  • Floods: Lekki, VI May Lose Attraction, Say Experts

The recent flooding experienced in some parts of the country, especially in Lagos, has raised fears that petroleum products in filling stations’ storage facilities located in the affected areas may have been contaminated.

Real estate experts, including land and estate surveyors and valuers, as well as town planners have said the massive flooding in Lekki, Ajah, Ikoyi and Victoria Island, will lead to a reduction in the appetite of prospective tenants and property buyers.

A top official in one of the fuel marketing companies in Lagos told our correspondent that the fuel in the underground tanks in some of the stations in the affected areas would have been contaminated with water, and this could damage car engines.

“Some stations may not want to go through the process of draining the water. Lekki, Ikoyi and Victoria Island, among others, are prime areas and that is why we have many standard stations along that line. There are stations that sell one truck a day,” the source said.

The Vice President and Head of Energy Research, Ecobank, Mr. Dolapo Oni, noted that most filling stations were using underground tanks to store petroleum products, saying, “The basic worry is how much of the tanks have been affected.

“How much petrol could have been adulterated or contaminated with water? What have stations done to reduce the risk of contamination by water?”

The Executive Secretary, Major Oil Marketers Association of Nigeria, Mr. Obafemi Olawore, said, “We have our environment, health, safety and quality departments that will look at everything. For major marketers, before we send one litre out, we have made sure that the product meets every standard.

“If any marketer goes to his station after the flood would have receded, he will check everything; no marketer would sell fuel adulterated with water.”

The Vice President, Africa Chapter, International Real Estate Federation, Chief Kola Akomolede, said many people would be discouraged from buying or building properties in flood-prone areas of Lekki, Ikoyi, Victoria Island and others.

He, however, said the floods would have a significant effect on a country with acute shortage of accommodation.

“If it were in a country where there are several other choices, people will move en masse from Lekki and Victoria Island axis. We are not likely to see that kind of movement because there are no alternatives,” Akomolede stated.

According to him, some properties may remain unlet or unsold for some time, because of the flooding issue, adding, “That is supposed to bring down prices or rent.”

The Principal Partner, Ubosi Eleh & Co, an estate surveying and valuation firm, Mr. Chudi Ubosi, said with the flooding, people would worry a lot about buying properties in Lekki and would be a lot more circumspect and careful about what they buy.

“Developers will also be a lot more cautious about development, creating adequate channels as much as they can for water to run off,” he added.

A former President, Association of Town Planning Consultants of Nigeria, Mr. Moses Ogunleye, said the principal cause of the floods in Lagos was non-adherence to the physical development plans that had been prepared for various parts of the state.

He said, “For instance, there is what we call Lekki Infrastructure Master Plan; I am not sure a substantial percentage of that plan was implemented. We have a master plan that the government itself funded and it did not fully implement. The master plan says there should be new roads and drainages, and that canals should be constructed, among others.

“If we had these kinds of rains, that I don’t think were major, and we are having floods, then it means more problems will come.”

Ogunleye added that all the drains in the Lekki corridor should be properly re-emptied, as part of the short-term measures to stem flooding in the area.

“In the medium to long term, let there be a functional drainage system in Lagos,” he said, adding that there would be need for the demolition of some buildings on flood paths.

A surveyor and Managing Director, Lordsfield Limited, Mr. Ropo Olajugba, said, “When you sand-fill swamps and wetlands for construction and everyone filled to his own height, where do you expect the water to go? When yards are floored with cement rather than grass, then you can’t complain of flooding.”

He stressed the need for the country to develop modern flood management skills and techniques, which he said could only be achieved with proven technology.

“All physical development must be referenced to same datum: mean sea level. Meanwhile, a holistic measurement of what is where as presently existing must urgently be made, with a technology called Lidar; this will give a bird’s eye view of the topography of every half a metre space within the region,” Olajugba stated.

He added that blockages would be identified and future single development referencing could be achieved.

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.

Continue Reading
Comments

Energy

Egypt Increases Fuel Prices by 15% Amid IMF Deal

Published

on

Petrol - Investors King

Egypt has raised fuel prices by up to 15% as the country looks to cut state subsidies as part of a new agreement with the International Monetary Fund (IMF).

The oil ministry announced increases across a variety of fuel products, including gasoline, diesel, and kerosene.

However, fuel oil used for electricity and food-related industries will remain unaffected to protect essential services.

This decision comes after a pricing committee’s quarterly review, reflecting Egypt’s commitment to align with its financial obligations under the IMF pact.

Egypt is in the midst of recalibrating its economy following a massive $57 billion bailout, orchestrated with the IMF and the United Arab Emirates.

The IMF, which has expanded its support to $8 billion, emphasizes the need for Egypt to replace untargeted fuel subsidies with more focused social spending.

This is seen as a crucial component of a sustainable fiscal strategy aimed at stabilizing the nation’s finances.

Effective immediately, the cost of diesel will increase to 11.5 Egyptian pounds per liter from 10.

Gasoline prices have also risen, with 95, 92, and 80-octane types now costing 15, 13.75, and 12.25 pounds per liter, respectively.

Despite the hikes, Egypt’s fuel prices remain among the lowest globally, trailing only behind nations like Iran and Libya.

The latest increase follows recent adjustments to the price of subsidized bread, another key staple for Egyptians, underscoring the government’s resolve to navigate its economic crisis through tough reforms.

While the rise in fuel costs is expected to impact millions, analysts suggest the inflationary effects might be moderate.

EFG Hermes noted that the gradual removal of subsidies and a potential hike in power tariffs could have a relatively limited impact on overall consumer prices.

They predict that the deceleration in inflation will persist throughout the year.

Egypt’s efforts to manage inflation have shown progress, with headline inflation slowing for the fourth consecutive month in June.

This trend offers a glimmer of hope for the government as it strives to balance economic stability with social welfare.

The IMF and Egyptian officials are scheduled to meet on July 29 for a third review of the loan program. Approval from the IMF board could unlock an additional $820 million tranche, further supporting Egypt’s economic restructuring.

Continue Reading

Crude Oil

Oil Prices Rise on U.S. Inventory Draws Despite Global Demand Worries

Published

on

Oil

Oil prices gained on Wednesday following the reduction in U.S. crude and fuel inventories.

However, the market remains cautious due to ongoing concerns about weak global demand.

Brent crude oil, against which Nigerian crude oil is priced, increased by 66 cents, or 0.81% to $81.67 a barrel. Similarly, U.S. West Texas Intermediate crude climbed 78 cents, or 1.01%, to $77.74 per barrel.

The U.S. Energy Information Administration (EIA) reported a substantial decline in crude inventories by 3.7 million barrels last week, surpassing analysts’ expectations of a 1.6-million-barrel draw.

Gasoline stocks also fell by 5.6 million barrels, while distillate stockpiles decreased by 2.8 million barrels, contradicting predictions of a 250,000-barrel increase.

Phil Flynn, an analyst at Price Futures Group, described the EIA report as “very bullish,” indicating a potential for future crude draws as demand appears to outpace supply.

Despite these positive inventory trends, the market is still wary of global demand weaknesses. Concerns stem from a lackluster summer driving season in the U.S., which is expected to result in lower second-quarter earnings for refiners.

Also, economic challenges in China, the world’s largest crude importer, and declining oil deliveries to India, the third-largest importer, contribute to the apprehension about global demand.

Wildfires in Canada have further complicated the supply landscape, forcing some producers to cut back on production.

Imperial Oil, for instance, has reduced non-essential staff at its Kearl oil sands site as a precautionary measure.

While prices snapped a three-session losing streak due to the inventory draws and supply risks, the market remains under pressure.

Factors such as ceasefire talks between Israel and Hamas, and China’s economic slowdown, continue to weigh heavily on traders’ minds.

In recent sessions, WTI had fallen 7%, with Brent down nearly 5%, reflecting the volatility and uncertainty gripping the market.

As the industry navigates these complex dynamics, analysts and investors alike are closely monitoring developments that could further impact oil prices.

Continue Reading

Commodities

Economic Strain Halts Nigeria’s Cocoa Industry: From 15 Factories to 5

Published

on

cocoa-tree

Once a bustling sector, Nigeria’s cocoa processing industry has hit a distressing low with operational factories dwindling from 15 to just five.

The cocoa industry, once a vibrant part of Nigeria’s economy, is now struggling to maintain even a fraction of its previous capacity.

The five remaining factories, operating at a combined utilization of merely 20,000 metric tons annually, now run at only 8% of their installed capacity.

This stark reduction from a robust 250,000 metric tons reflects the sector’s profound troubles.

Felix Oladunjoye, chairman of the Cocoa Processors Association of Nigeria (COPAN), voiced his concerns in a recent briefing, calling for an emergency declaration in the sector.

“The challenges are monumental. We need at least five times the working capital we had last year just to secure essential inputs,” Oladunjoye said.

Rising costs, especially in energy, alongside a cumbersome regulatory environment, have compounded the sector’s woes.

Farmers, who previously sold their cocoa beans to processors, now prefer to sell to merchants who offer higher prices.

This shift has further strained the remaining processors, who struggle to compete and maintain operations under the harsh economic conditions.

Also, multiple layers of taxation and high energy costs have rendered processing increasingly unviable.

Adding to the industry’s plight are new export regulations proposed by the National Agency for Food and Drug Administration and Control (NAFDAC).

Oladunjoye criticized these regulations as duplicative and detrimental, predicting they would lead to higher costs and penalties for exporters.

“These regulations will only worsen our situation, leading to more shutdowns and job losses,” he warned.

The cocoa processing sector is not only suffering from internal economic challenges but also from a tough external environment.

Nigerian processors are finding it difficult to compete with their counterparts in Ghana and Ivory Coast, who benefit from lower production costs and more favorable export conditions.

Despite Nigeria’s potential as a top cocoa producer, with a global ranking of the fourth-largest supplier in the 2021/2022 season, the industry is struggling to capitalize on its opportunities.

The decline in processing capacity and the industry’s current state of distress highlight the urgent need for policy interventions and financial support.

The government’s export drive initiatives, aimed at boosting the sector, seem to be falling short. With the industry facing over N500 billion in tied-up investments and debts, the call for a focused rescue plan has never been more urgent.

The cocoa sector remains a significant part of Nigeria’s economy, but without substantial support and reforms, it risks falling further into disrepair.

Continue Reading
Advertisement




Advertisement
Advertisement
Advertisement

Trending