- NNPC Records N240bn Loss in 13-month Petrol Supplies
Between March 2017 and March 2018, a period of 13 months, the Nigerian National Petroleum Corporation (NNPC) incurred a loss of N240,304,755,518 as under-recovered expenditure in importing petrol at the international market price and selling at the federal government’s regulated pump price of N145 per litre, according to the corporation’s monthly financial report.
Also, the report, which showed that 80.26 million litres of petrol was consumed in March 2018, also indicated that in February 2018, Nigeria’s oil production volumes declined by about 7.588 million barrels on account of multiple production shut-ins mostly on crude oil export terminals and pipelines.
Under-recovery is another term to describe subsidy, which arises as a result of the difference between the landing cost of refined products and the official prices.
The corporation in its March 2018 financial and operations report – the latest so far, indicated that it lost N240.3 billion for keeping petrol pump price at N145 per litre at that period, and this loss represents the amount that should be paid to it afterwards as petrol subsidy claims, assuming the federal government is still operating the subsidy regime.
The monthly report was released in Abuja by the NNPC and obtained by THISDAY.
According to the NNPC report, N240,304,755,518 was recorded as under recovery for the 13-month period; N17,619,360,579 recorded as crude oil losses; products losses was N8,334,022,400; while pipeline repair and management costs resulted in N129,688,449,152.
A further breakdown of the figures indicated that in March 2017, NNPC recorded an under-recovery of N8,206,727,836; in April, it was N8,206,727,836; and in May, it was N7,743,923,020; and between June, July, August, September, October, November, and December of 2017, the corporation netted under-recoveries of N11,792,197,288; N10,250,012,947; N7,938,985,582; N7,521,590,052; N6,848,622,525; N16,785,193,827; and N15,676,576,185, respectively.
In January 2018, it recorded N45,782,705,844 as under-recovery; N59,519,058,738 in February; and then N34,032,433,839 in March.
NNPC said: “In the downstream sector, NNPC continued to ensure increased petrol supply and effective distribution across the country. In March, 2018, 2.49 billion litres of petrol were supplied by NNPC translating to 80.26 million litres/day to sustain seamless distribution of petroleum products and zero fuel queue across the nation.
“The corporation is maintaining an eagle eye on the daily or petrol evacuation figures from depots across the nation, and engaged where necessary the Nigerian Customs Service (NCS) through existing Joint Monitoring Team.
“In March 2018, pipeline break stood at 224, of which 25 pipeline points either failed to be welded or ruptured/clamped. Thus 199 pipeline points were vandalised as against 125 recorded last month. PHC-Aba and Aba-Enugu pipeline segment accounted for 177 points or 88.94 per cent of the affected pipeline points.”
“NNPC transferred the sum of N73.01 billion into Federation Account for the month under review. From March 2017 to March 2018, Federation, JV, and FG for debt repayment received the sum of N851.65 billion, N672.02 billion and N6.33 billion respectively,” said the report
The NNPC further explained that while the country’s total oil production at that period was 56.24 million barrels, it could not get about 7.588 million barrels to the surface and market because it had issues at the Qua Iboe, Forcados, Bonny, Bonga, and Agbami oil terminals.
Based on the report’s claim that the average price of crude oil at that period was $63.37 per barrel, THISDAY’s calculations indicated that about $480,851,560 (7.588 million barrels multiplied by $63.37 per barrel) may have been the possible monetary loss from the shut-ins.
It stated that out of the 56.24 million barrels of crude oil and condensate that was produced, and which represented an average daily production of 2 million barrels, Joint Ventures (JVs) and Production Sharing Contracts (PSC) contributed about 33.44 per cent and 38.14 per cent respectively, while Alternative Financing (AF), Nigerian Petroleum Development Company (NPDC) and independents accounted for 13.55 per cent, 7.32 per cent and 7.54 per cent respectively.
On the production shut-ins, the report stated that at the Qua Iboe Terminal, about 160,000 bpd of oil was shut-in throughout February 2018 due to the aging facilities and integrity issues.
At the Bonny Terminal, it noted that the Trans Niger Pipeline (TNP) was shut down from February 13 to 16, 2018 due to a leak in the Bodo area with the loss of approximately 120,000 bpd of production.
At the Forcados Terminal, it explained that about 180,000 bpd of production was deferred due to shut down of the Trans Forcados Pipeline (TFP) as a result of leakage of hot taps in the Oteghele axis for five days in February 2018.
The Bonga Terminal, it noted, experienced about 55,000 bpd of shut-in due to plant shutdown for water flood gray lock leak repairs from February 4 to 15, 2018.
In addition, it said a shut-in of 215,000bpd was experienced as a result of complete shut down for water flood gray lock leak repairs for five days at the Bonga Terminal.
At the Agbami Terminal, it said production was shut-in for seven days to mitigate the impact of wind direction on flare that set off smoke and thermal alarms resulting to the shut-in of about 24,000 bpd.
Flour Mills of Nigeria Repays N51.64 Billion Series 2 Commercial Paper
Flour Mills of Nigeria Plc (FMN) has successfully repaid its N51.64 billion Series 2 Commercial Paper as revealed in a statement issued by the company.
This follows the earlier repayment of its N13.33 billion Series 1 Commercial Paper in August 2023.
Both the Series 1 and Series 2 Commercial Papers, totaling N64.97 billion, were initially issued on February 22, 2023, under FMN’s N200 billion Commercial Paper Programme.
The Series 1, with a yield of 13.0%, raised N13.3 billion, while the Series 2, with a yield of 14.0%, raised N51.64 billion.
FMN had launched its N200 billion Commercial Paper Programme on February 10, 2023, reflecting the company’s strategic financial planning.
The Group Chief Finance Officer, Mr. Anders Kristiansson, expressed satisfaction with the timely and successful repayment of the Series 2 Commercial Paper.
He emphasized FMN’s commitment to financial prudence and acknowledged the confidence placed in the organization by the investing public.
Kristiansson expressed gratitude to stakeholders for their continuous support, reiterating FMN’s dedication to delivering sustainable value and upholding the highest standards of corporate governance.
In addition to the successful repayment, FMN tapped into the market for its Series 3 Commercial Paper in June 2023, with subscriptions from banks and Pension Fund Administrators, contributing 39.7% and 40.8%, respectively.
The transaction was managed by FBNQuest Merchant Bank Limited as the Lead Arranger, with ChapelHill Denham Advisory Limited, FCMB Capital Limited, and United Capital PLC serving as Joint Arrangers.
African Airlines Projected to Cut Losses to $400m in 2024, Says IATA
The International Air Transport Association (IATA) has forecasted a reduction in losses for Nigerian and other African airlines from $500 million in 2023 to $400 million in 2024.
The Switzerland-based IATA made this projection while presenting the global airline industry outlook in Geneva, Switzerland, on Wednesday.
IATA’s Director-General, Willie Walsh, shared the outlook, stating that global airlines are expected to generate approximately $964 billion in revenue in the coming year.
The report indicated that airline industry net profits are anticipated to reach $25.7 billion in 2024, reflecting a slight improvement over the projected $23.3 billion net profit for 2023.
Despite the challenges faced by the aviation industry in recent years, IATA sees the $25.7 billion net profit in 2024 as a testament to aviation’s resilience.
Walsh acknowledged the impressive speed of recovery but emphasized that the net profit margin of 2.7% remains below industry expectations.
IATA estimates that around 4.7 billion people will travel in 2024, surpassing the pre-pandemic level of 4.5 billion recorded in 2019.
However, Walsh highlighted ongoing challenges, including regulatory burdens, fragmentation, high infrastructure costs, and a supply chain populated with uncertainties.
He emphasized the need for the industry to build a resilient future, given its significant contribution to global GDP and livelihoods.
Fuel prices are expected to average $113.8 per barrel in 2024, accounting for 31% of all operating costs, totaling $281 billion.
Walsh concluded by expressing optimism about more normal growth patterns for both passenger and cargo in the post-pandemic era.
SpaceX Explores $175 Billion Valuation in Insider Share Sale Talks
Business3 weeks ago
Nigeria’s Logistics Sector Holds Untapped N3tn Potential, Says Courier and Logistics Management Institute
Black Market Rate4 weeks ago
Black Market Exchange Rate Today 14th November 2023
News4 weeks ago
Millionaire Powerplay Limited Unveils Unprecedented Odds in American Lotto’s Instant Cashless Payout
Forex3 weeks ago
Black Market Exchange Rate Today 16th November 2023
Forex4 weeks ago
Black Market Exchange Rate Today 10th November 2023
Black Market Rate3 weeks ago
Black Market Exchange Rate Today 21st November 2023
Telecommunications3 weeks ago
Airtel Africa Announces Interim Dividend Amidst Robust Half-Year Performance
Naira4 weeks ago
N-Power Dismisses Fake Recruitment Reports, Highlights Ongoing Payment Resolutions