Connect with us

Economy

Power: Benin, Niger Pay Nigeria $10m After Disconnection Threat

Published

on

Electricity - Investors King
  • Power: Benin Republic, Niger Pay Nigeria $10m After Disconnection Threat

The Republics of Benin and Niger have paid $10.1m as electricity bill to Nigeria to avert being disconnected from their power source in Nigeria after the Federal Government threatened to disconnect debtors.

It was also learnt that the countries made the payment through their respective power firms, with NIGELEC of the Republic of Niger paying $3.79m, while the Community Electric du Benin of the Republic of Benin remitted $6.32m to Nigeria’s electricity market.

On July 11, 2018, President Muhammadu Buhari decided to join operators in the power sector in calling on international customers receiving electricity from Nigeria to either pay their bills or be disconnected.

Nigeria sells power to the Republics of Togo, Niger and Benin, and classifies the West African countries as international customers.

Officials at the Federal Ministry of Power, Works and Housing told our correspondent in Abuja on Thursday that the international customers, paying for the power received from Nigeria in dollars, owed the country, a development that had increased the financial indebtedness to Nigeria’s power generation companies.

To avert being disconnected, it was gathered on Thursday that Benin and Niger made some payments and that the payment by both countries was disclosed to operators in Nigeria’s electricity industry at the August 2018 power sector stakeholders’ meeting by the Market Operator, an arm of the Transmission Company of Nigeria.

This was also confirmed in a report that was presented to stakeholders at the meeting by the MO, which was obtained by our correspondent from the FMPWH.

On its dashboard on the summary of energy delivery in the month of June 2018, the MO stated that energy delivered to international customers and Ajaokuta Steel was 229,487.29 megawatts/hour.

Under bilateral trading, it stated that the quantum of energy sent out by power generation companies was 104,861.92MWh, while energy delivered to bilateral customers was 95,939.31MWh.

Figures on the dashboard showed that indigenous power distribution companies, as always, got the highest quantum of energy, 2,355,623.4MWh, from the Gencos in the month under review.

The MO further stated that part of the foreign exchange inflows from international customers had been disbursed to service providers in Nigeria’s power sector.

The indebtedness of international customers was also confirmed by the Minister of Power, Works and Housing, Babatunde Fashola, in July, who, however, revealed that Buhari was working hard to ensure that the electricity debts by the country’s neighbours were cleared.

Fashola had also directed the Nigerian Bulk Electricity Trading Company to go ahead and collect its money from the international customers.

He said, “We issued disconnection notices and that is why I’m asking the NBET to go and collect your money because we have duties, obligations and international agreements with them as brother and sister nations.

“But that does not mean they will not pay us if they are defaulting. So, we have issued letters to them to pay their bills, and from time to time, they pay.

“There was a time one head of state came to visit President Buhari and little did I know that the real reason he came was to come and tell him that the (power) sector had issued a notice of disconnection to his country. And you may be interested to know that President Buhari simply told him to go and pay, otherwise we will disconnect you because we are also paying at home.”

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

Economy

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

Published

on

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.

Continue Reading

Economy

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

Published

on

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.

Continue Reading

Economy

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

Published

on

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.

Continue Reading
Advertisement




Advertisement
Advertisement
Advertisement

Trending