- Gas Flaring: FG Gives Oil Firms 2019 Deadline
Any oil company that cannot stop gas flaring by 2019 should stop producing, the Minister of State for Petroleum Resources, Dr Ibe Kachikwu, has said.
Kachikwu stated that the Department of Petroleum Resources would become severe in upholding sanctions against defaulters by preventing them from oil production from next year.
The minister said these at the 2018 Buyers’ Forum/Stakeholders’ Engagement organised by the Gas Aggregation Company of Nigeria Limited in Abuja.
He said any oil firm that could not end gas flaring ought not to be producing.
Kachikwu stated, “Government wants to end flare; oil companies still give lots of reasons why flare cannot be ended. Bottom line is cash call and money. But the reality is that whether or not we deal with cash call issues, it is not an optional agenda. It is a compulsive immediate agenda. It is destructive to the populace; it is intolerable in developed countries and it should not be tolerable here either.
“Any oil company that cannot find a way to end its flare ought not to be producing. And I have said to the DPR that beginning from next year, we are going to get quite frantic about this. Companies that cannot meet with extended periods, the issue is not how much you pay in terms of fines for flaring; the issue is that you will not produce. We need to begin to look at foreclosing of licences. It is that urgent.”
The minister also stated that the Federal Government would inaugurate the infrastructure revamp programme in November, adding that the initiative had the potential of attracting between $20bn and $30bn worth of investments into the petroleum industry.
Kachikwu stated that the quest to discourage gas flaring made the Federal Government to initiate the gas flare commercialisation programme.
He noted that future renewal of oil and gas licences would involve the assessment of the gas components and gas flare rate of each company seeking renewal.
“Some of the ones that have come recently for renewals have insisted that they are building massive gas processing plants and we are going to follow this right through so that the supply obligation, the processing facility, the treatment of gas and their submissions are very accurate and aggressive,” he said.
Kachikwu also emphasised the need for a critical implementation of the domestic supply obligation, which would be extended to domestic supply and processing obligation for both gas and crude oil.
He said the country needed to move away from the point of just producing these commodities, throwing them into the vessel and shipping them out, to the point of processing them locally.
The Managing Director, GACN, Morgan Okwoche, called for increased support for the gas company and highlighted the need for optimum collaboration among industry players in the development of the gas sector.
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.
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