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Nigeria, Morocco Gas Pipeline to Supply 15 Countries

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Gas-Pipeline
  • Nigeria, Morocco Gas Pipeline to Supply 15 Countries

Nigeria and Morocco have completed the feasibility study for the construction of the 5,660km Nigeria-Morocco Gas Pipeline and the facility will supply gas to at least 15 countries in West Africa, the Group Managing Director of the Nigerian National Petroleum Corporation, Maikanti Baru, announced on Monday.

Baru also stated that pre-Front End Engineering Design optimisation study for the pipeline was currently ongoing, adding that the facility would boost the region’s industries when completed.

This is coming as the Minister of State for Petroleum Resources, Ibe Kachikwu, announced that African countries were mobilising about $2bn to develop a financing body that will fund the energy sector.

Both the NNPC boss and the minister spoke at the Nigeria International Petroleum Summit in Abuja which had senior government officials from across Africa, Europe and America.

In his address at the summit, Baru said, “We need to collaborate especially in the area of infrastructure. Today, Nigeria and Morocco are collaborating to construct a gas pipeline that will traverse at least 15 West African countries with intake and offtake points in the various countries before it links with the existing Maghreb-Europe gas pipeline in Northern Morocco. The feasibility study has been concluded and the pre-FEED optimisation study is currently ongoing.

“This pipeline will help in the industrialisation of these countries. It will also meet the needs of consumers for heating and other uses. We see gas as a fuel to take Africa to the next level. New gas discoveries have been recorded offshore Senegal, Mauritania, Mozambique and are in various stages of development.”

He added, “Nigeria is also targeting to take FID on LNG Train 7 this year. So African countries need to collaborate and trade among each other not only in terms of oil and gas but also in other key sectors so that the multiplier effect is seen across our various economies.”

On his part, Kachikwu, who doubles as the President of African Petroleum Producers Organisation, stated that APPO was sourcing for about $2bn for an energy corporation.

He said, “We are presently looking at expanding the role of a particular financing body that we are going to be calling the African Energy Investment Corporation. The whole idea is to mobilise between $1bn and $2bn of resources to fund all the essentials necessary for us to properly collaborate.

“Today, most African countries are silos, everybody does their own thing; you build your own refineries, plants, gas turbines, etc. If we could just cross the Rubicon and be able to extend hands of infrastructural relationship across Africa, build joint pipelines, plants and refineries; begin to protect the African market, we would have taken a huge step, not only in the development of Africa but to the stabilisation of independent countries.”

The minister, however, noted that the oil sector in Africa was facing some challenges.

Kachikwu said, “On the challenge side, certain things jump out; such as shale, oil pricing, investment limitation, President Trump and so many other things. At the opportunity side, so many other things are going. However, with the opportunities arise challenges, especially those to do with the environment.

“Unless you get your policies right, unless you get your market place right, unless you get your collaborative mechanisms right and get your infrastructure right, you would face a huge amount of challenge in the competition for the very scarce resources and scarce capital.”

Kachikwu stated that aside from Nigeria’s effort in domestic gas supply, the country was also expanding frontiers in the export market.

He confirmed Baru’s position and stated that the Federal Government had executed the Memorandum of Understanding between NNPC and the Office National des Hydrocarbures et des Mines Morocco for collaboration in the construction of a gas pipeline from Nigeria to Morocco.

“The NGMP feasibility study was completed in July 2018 and the FEED Phase 1 scope is expected to be completed by end of Q1, 2019,” the minister said.

On the skills in Nigeria’s oil and gas sector, Kachikwu stated that over 90 per cent of the oil majors’ workforce was Nigerians.

“This means that some of the best skill sets are here. One of the things I found going into the NNPC in 2015 was that every detail of capability that you need to run a global company sat in NNPC. They are much trained, very well exposed. We have issues in terms of policies, but in terms of skill sets, we are solid,” the minister added.

He further noted that Africa’s place as a significant producer and net exporter of oil in the world was forecast to grow by about 15 per cent by 2020 due to new discoveries in some Sub-Saharan countries.

Kachikwu stated that in the last five years, nearly 30 per cent of the world’s oil and gas discoveries were in Sub-Saharan Africa, adding that it was estimated that Africa oil and gas would increase by 74 per cent by 2050.

“We need the right policies, the right partnerships and the right investments. And now is the only time,” he said.

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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