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NNPC Shifts 40 Billion Oil Reserves Target to 2025

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Silhouette of oil platform in sea against moody sky at sunset
  • NNPC Shifts 40 Billion Oil Reserves Target to 2025

The Nigerian National Petroleum Corporation has said it seeks to increase the nation’s crude oil reserves to 40 billion barrels and production capacity to four million barrels per day by 2025.

The Federal Government in 2010 set the target of 40 billion barrels of crude oil reserves and production of four million barrels per day at 2020.

The Group Managing Director, NNPC, Dr Maikanti Baru, on Thursday, gave the indication that the corporation was seeking to attract necessary funding from the capital market for the development of the nation’s oil and gas resources.

In his address on the state of the industry, titled ‘Moving Nigeria towards energy self-sufficiency,’ at the Society of Petroleum Engineers’ Oloibiri Lecture Series and Energy Forum 2019, Baru said, “There is increasing global competition on Nigerian crude oil due to the rise of new production centres across the globe particularly in Africa and Argentina. These portend a new dimension for the Nigerian oil and gas industry.

“Nigeria, therefore, needs to unlock new barrels as quickly as possible to stay relevant in the new emerging world. Without adequate funding, we cannot meet the targets.”

Baru stated that evolving new funding mechanisms for the Joint Venture operations was part of the focus of the reforms undertaken by the government to eliminate the often difficult cash call regime, enhance the efficiency of the management of oil and gas resources and guarantee growth.

He observed that to encourage the existing players in the industry, particularly the traditional JV partners, “we undertook to settle all outstanding cash call arrears amounting to a negotiated sum of a little over $5bn.

“This has restored confidence in the Nigeria oil and gas industry. We have signed third-party financing deals with several international and local banks on new oil and gas developments worth over $3bn despite the depression in 2016/201 7. This demonstrates the faith in our industry and the potential we can unlock.”

He further stated that the oil firm was on the move to attract funding from the capital market.

“For our IOC partners, we would continue to leverage the strong credit rating of partners, identify key quick-win projects that are easy to mature with strong cash flow projections and attract the necessary funding from the capital market,” Baru said.

He added, “These alternative financing approaches to fund NNPC’s JV obligations have helped to renew investors’ confidence and stimulate further foreign direct investments. In particular, this has deepened local banks’ participation in financing the upstream sector as the financing are syndicated from local banks and international lenders.”

The GMD said the country’s petroleum product demand was expected to grow from 13.2 million metric tonnes in 2015, 15.1 million metric tonnes in 2020 and 17.3 million metric tonnes by 2025, while the population growth corresponding to the demand was 182 million in 2015, projected to be 207 million in 2020 and 234 million in 2025.

“The average population growth rate is three per cent per annum,” Baru stated.

He noted that Nigeria needed a refining capacity of 1.52 million barrels per day of crude oil in order to meet its Premium Motor Spirit requirement by 2025.

According to him, this capacity requirement includes Dangote’s 650,000 barrels per day refinery and NNPC’s current nameplate capacity of 445,000 barrels per day for its three refineries in Warri, Kaduna and Port Harcourt.

He said, “This leaves a shortfall of 20 million litres which is equivalent to 427,000 bpsd. In order to address this shortfall in PMS demand, NNPC is adding 215,000 bpsd of refining capacity through private- sector driven collocation at our existing facilities in Port Harcourt Refining Company (100,000 bpsd) and Warri Refining and Petrochemicals Company (115,000 bpsd).”

On measures put in place to ensure full energy sufficiency for Nigeria, Baru stated that NNPC was focusing on developing the nation’s gas resources.

He said the seven critical gas development projects targeted to deliver about three billion standard cubic feet of gas per day resources to the gas market by 2020 were at different stages of development in conjunction with the NNPC joint venture partners.

Baru said “The Assa North-Ohaji South Gas Development Project is ahead of the other projects. We have completed the Front End Engineering Design for facilities and pipelines for ANOH and have taken the Final Investment Decision for the project in December 2018 after lingering for many years.”

The GMD also noted that there had been an emerging class of new producers within the oil and gas Industry who were primarily local independents with a non- diversified portfolio and lean balance sheet or required track record to raise substantial funds.

“They have become important because approximately 15 per cent of both crude oil and gas reserves and national production lie in their hands. They also require substantial capital for growth. The Nigerian oil and gas landscape is fast changing from IOC-dominated to a much more diversified cocktail of influences involving locals, independents and the national oil company (NNPC),” he stated.

He added that it was quite an exciting time ahead for the Nigeria oil and gas industry, as the industry was funding both development and infrastructure through alternative means.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Economy

India, Spain, the Netherlands, USA, Nigeria’s Major Export Markets -NBS

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Institute of Chartered Shipbrokers

India, Spain and the Netherland top Nigeria’s export markets in the final quarter of 2020, according to the latest data from the National Bureau of Statistics (NBS).

The Commodity Price Indices and Terms of Trade Q4 2020 report showed that the United States and China trailed the three.

However, the NBS revealed Nigeria exports mainly crude oil and natural gas during the period under review.

It, “The major export and import market of Nigeria in Q4 2020 were India, Spain, the Netherlands, United States and China.

“The major export to these countries were crude petroleum and natural gas. The major imports from the countries were motor spirits, used vehicles, motorcycles and antibiotics.”

The bureau stated that the all-commodity group import index increased by 0.13 per cent between October and December 2020.

This was driven mainly by an increase in the prices of base metals and articles of base metals (one per cent), boilers, machinery and appliances; parts thereof (1.03 per cent), and products of the chemical and allied industries (0.75 per cent),” it stated.

The NBS, however, noted that the index was negatively affected by animal and vegetable fats and oils and other cleavage products.

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Economy

Onyeama: Qatar To Invest $5bn In Nigeria’s Economy

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The oil-rich state of Qatar is to invest a total of $5 billion in Nigeria’s economy, the Foreign Affairs Minister, Godfrey Onyeama, has disclosed.

Onyeama, who spoke Sunday at a send forth dinner in honour of Nigeria’s Ambassador-designate to the State of Qatar, who is also the outgoing Director of Protocol (DOP) at the State House, Ambassador Yakubu Ahmed, also stated that recent career ambassadorial appointments made by the gederal government was based on merit, experience and professionalism.

The minister further said there had been discussions with Qatar on partnership with Nigeria’s Sovereign Wealth Fund (SWF), for significant investments in the region of $5 billion in the Nigerian economy.

According to him, ‘‘Qatar is a weighty and strategic country and very strategic in that part of the world and we are putting our best feet forward to advance the interest of our country economically and in other areas.”

He recalled that President Muhammadu Buhari had visited the State of Qatar in 2016 and the Emir of Qatar, Tamim Bin Hammad Al-Thani, reciprocated with a State visit in 2019.

Onyeama also explained that only trusted hands with a track record of diligence, experience and professionalism in the Foreign Service were recently appointed career ambassadors by the federal government.

The minister said the appointment of Ahmed and other career ambassadors were predicated on posting dedicated and keen Foreign Service practitioners to serve as image makers of the country.

He said: ‘‘Ambassador Yakubu Ahmed is a dedicated professional with a penchant for rigour and detail. He is very capable and one of the best in the Ministry of Foreign Affairs. He is personable, affable, extremely friendly, dispassionate and objective.

‘‘He is going to head a very important mission, a very important country, reckoned to be one of the richest countries in the world, per capita, and there’s a lot we will be doing with the State of Qatar.”

Also speaking, the Deputy Chief of Staff, Adeola Rahman Ipaye, described the honoree as a ‘‘perfect gentleman, very even-natured and always well turned out’’.

Ipaye said he had no doubt that the newly appointed ambassador would serve the country well in Qatar, adding that: ‘‘We are further encouraged that when he completes this assignment, he would return to serve Nigeria in a higher capacity.’’

In his remarks, the Permanent Secretary, State House, Tijjani Umar, while congratulating the outgoing DOP on his appointment, lauded Ahmed for excellent service to the State House and the nation.

‘‘He served this institution and the nation with the deepest sense of responsibility and it is very important that we establish a tradition where the system appreciates those who have served it well and those who will continue to serve it well,’’ he said.

Umar urged the new envoy to keep very fond memories of his time at the Presidential Villa, assuring him of the prayers and goodwill of all the staff.

Responding, Ahmed thanked President Buhari for the great honour and privilege of making him his principal representative in Doha, Qatar.

The Ambassador-designate pledged to deplore his energy and skill to the promotion of the existing cordial relationship between Nigeria and Qatar, particularly in the areas of economic, political, cultural and consular affairs as well as other key areas.

Ahmed, who joined Nigeria’s Foreign Service in 1993, said during his years in public service he had learnt that ‘‘patriotism, selfless service, diligence, determination and perseverance will always result in the achievement of the desired objective’’.

According to him, these virtues would be his ‘‘watchword’’ in the pursuit of Nigeria’s foreign policy objectives and the attainment of national interests.

The Ambassador-designate singled out for appreciation the Chief of Staff to the President, Prof. Ibrahim Gambari, and the state Chief of Protocol, Ambassador Lawal Kazaure, saying he had learnt a lot working under their mentorship.

He expressed gratitude to the Minister of Foreign Affairs and the Permanent Secretary, State House for giving him the opportunity of a memorable work experience in the State House.

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Economy

France, Nigeria to Build New Partnership

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France is currently aiming at building a new partnership with Nigeria, with the dispatching of its Minister in charge of Foreign Trade and Attractiveness, Franck Riester, to Nigeria.

Riester, who was expected at the time of filing this report on Monday, is scheduled to visit Nigeria from 12-14 April, 2021.

A statement from the French Embassy in Nigeria said: “Franck Riester is visiting Nigeria from 12 to 14 April, a visit that follows up on the priorities set by French President Emmanuel Macron during his official visit to Nigeria in July 2018 and his desire to build a new partnership between Africa and France.

“As the largest economy in Africa and the economic engine of West Africa, Nigeria is indeed a major partner for France, the first in sub-Saharan Africa with bilateral trade amounting to a total of 4.5 billion USD in 2019 (2.3 billion USD in 2020, due to the Covid-19 pandemic).”

It disclosed that the minister will have several official meetings in Abuja and Lagos, in order to underline the importance of the bilateral economic relationship and to prepare the summit on the financing of African economies in Paris on 18 May.

It revealed that the objective of the mission is also to further strengthen the links between the French and Nigerian private sectors, and “in this regard, the minister will have in-depth discussions with the main Nigerian economic actors to strengthen bilateral cooperation and investments, both in Nigeria and in France, particularly in the logistics sector”.

It said while in the country, the minister would meet with young Nigerian entrepreneurs in the cultural and creative industries sector, to discuss the major role of their country in African creativity and the development of the African entrepreneurial ecosystem, with the support of France.

It further said: “The minister will also open the ‘Choose Africa’ conference, a €3.5 billion initiative by President Emmanuel Macron dedicated to supporting the development of start-ups and SMEs in Africa to enable the continent to benefit fully from the opportunities of the digital revolution.”

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