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Roads: FG Releases N504bn Out of N890bn

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  • Roads: FG Releases N504bn Out of N890bn

The Federal Government released a total of N504.1bn out of the N890bn that was appropriated for the construction and rehabilitation of federal roads across the country in three years.

It was gathered that the N504.1bn was the total sum for capital releases to the Federal Ministry of Power, Works & Housing in 2016, 2017 and 2018 for the works sector.

On June 24, 2019, The media reported that Federal Government roads were still in disrepair despite the N757.48bn that was budgeted for the roads between 2015 and 2018.

Providing clarifications in a document that was made available to our correspondent by the FMPWH on Wednesday in Abuja, the ministry stated that all it got as capital releases for works in 2016, 2017 and 2018 was N504.1bn, instead of the N890bn appropriated for it.

The ministry also noted that the 2015 appropriation for works was meagre, adding that this was increased when the administration of President Muhammadu Buhari assumed office.

The FMPWH said, “It is pertinent to recall that the 2015 appropriation for the works sector was in the paltry sum of N18.132bn for all the ministry’s highway projects. This situation made most of the contractors to abandon their sites, retrench their personnel and shut down their operations.

“However, the appropriation for 2016, 2017 and 2018 were in the sums of N260bn, N274bn and N356bn while the releases were in the sums of N198.3bn, N177bn and N128.784bn respectively. These funds were expended on both inherited and new projects awarded by the Federal Government.”

The ministry stated that it managed 34,000km of federal roads spread across the six geo-political zones of the country.

It noted that with the funding requirements needed to restore the critical infrastructure, the Federal Government prioritised the projects to facilitate connectivity and to enhance socio-economic activities.

It added that the improved funding since 2016 ensured that contractors returned back to site and projects that were hitherto abandoned due to inadequate funding were revived.

On the status of the ministry’s activities on some specific roads, it said the Gusau-Dansadau Road was a state road belonging to the Zamfara State government and was under the purview of the state.

The FMPWH said the Oyo-lseyin-Ago Are-Saki Road in Oyo State had no budgetary provision, adding that the two substandard bridges at Km11 and Km25.6 along the road were, however, being procured by the ministry due to the socio-economic importance of the route.

On the lbadan-lfe Road in Oyo State, it said the road was being maintained by the Federal Roads Maintenance Agency and its reconstruction was under procurement process by the ministry.

The FMPWH said, “Osogbo-llesha Road in Osun State is a federal project and the contractor, Messrs Horizon Nigeria Limited, is currently working there.

“Makurdi-Aliade-Otukpo Road in Benue State has an on-going contract that involves the dualisation of Otukpo Township Road and rehabilitation of the remaining stretch up to Aliade being executed by M/s Rockbridge Nigeria Limited with 11km completed.”

It added, “FERMA is maintaining the Makurdi-Aliade section. The road between Makurdi-Otukpo-9th Mile has been awarded by this administration to Messrs China-Habour Nigeria Limited and construction work has commenced.”

“The Makurdi-Naka-Ankpa Road in Benue State has just been awarded to Gilmor Nigeria Limited by the Federal Government for reconstruction. Lagos-Badagry-Seme Road in Lagos State has an expansion and reconstruction project from Eric-Moore to Okokomaiko being executed by the Lagos State Government.”

The ministry explained that the Okokomaiko-Agbara section was under special maintenance recently awarded by FERMA, while the expansion/reconstruction of Agbara-Badagry-Seme Border section had been awarded to Messrs. CGC Nig. Limited for reconstruction by the Federal Government.

It said the Apapa-Oshodi Expressway in Lagos had been awarded to Messrs. Dangote Industries Limited for reconstruction under the Federal Government tax credit scheme and works had commenced on the road.

It went on to state that the Akure-Ado Ekiti Road was being designed for reconstruction by the ministry, adding that the Yahe-Wanakom-Benue State Border Road was being designed for reconstruction by the ministry.

On the Ejigbo-lwo Road in Osun State, the FMPWH said the road was not a federal road.

The ministry said the Suleja-Minna Road in Niger State had an ongoing contract awarded by the Federal Government to Messrs Salini Nigeria Limited for dualisation and this was one of the Sukuk funded highway projects.

The ministry assured the public that efforts were being made by the Federal Government to sustain the progress on the reconstruction of the federal roads network.

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

Oil Firms Borrowed N130B From Banks in February – CBN

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Operators in the downstream, natural gas and crude oil refining sectors of the Nigerian oil and gas industry borrowed N130b from Nigerian banks in February amid the significant rise in global crude oil prices.

The debt owed by the oil and gas companies rose to N4.05tn in February from N3.92bn in January, according to the latest data obtained from the Central Bank of Nigeria on Monday.

Operators in the upstream and services subsectors owed banks N1.26tn in February, down from N1.27tn a month earlier.

The combined debt of N5.31tn owed by oil and gas operators as of February 2021 represents 25.29 percent of the N21tn loans advanced to the private sector by the banks, according to the sectoral analysis by the CBN of deposit money banks’ credit.

Oil and gas firms received the biggest share of the credit from the deposit money banks to the private sector.

The slump in oil prices in 2020 as a result of the coronavirus pandemic hit many oil and gas companies hard, forcing them to slash their capital budgets and suspend some projects.

A global credit rating agency, Moody’s Investors Service, said last month that the outlook for Nigeria’s banking system remains negative, reflecting expectations of rising asset risk and weakening government support capacity over the next 12 to 18 months.

“Nigerian banks’ loan quality will weaken in 2021 as coronavirus support measures implemented by the government and central bank last year, including the loan repayment holiday, are unwound,” said Peter Mushangwe, an analyst at Moody’s.

The rating agency estimated that between 40 percent and 45 percent of banking loans were restructured in 2020, easing pressure on borrowers following the outbreak of the pandemic.

Another global credit rating agency, Fitch Ratings, had noted in a December 8 report that Nigerian bank asset quality had historically fallen with oil prices, with the oil sector representing 28 percent of loans at the end of the first half of 2020.

It said the upstream and midstream segments (nearly seven percent of gross loans) had been particularly affected by low oil prices and production cuts.

“However, the sector has performed better than expected since the start of the crisis, limiting the rise in credit losses this year due to a combination of debt relief afforded to customers, a stabilisation in oil prices, the hedging of financial exposures and the widespread restructuring of loans to the sector following the 2015 crisis,” it said.

The rating agency predicted that Nigerian bank asset quality would weaken over the next 12 to 18 months.

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Economy

Fall in Economic Activities in Nigeria Created N485.51 Billion Fiscal Deficit in January -CBN

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The drop in economic activities in Africa’s largest economy Nigeria led to a N485.51 billion fiscal deficit in January, according to the latest data from the Central Bank of Nigeria (CBN).

In the monthly economic report released on Friday by the apex bank, the weak revenue performance in January 2021 was due to the decline in non-oil receipts following the lingering negative effects of COVID-19 pandemic on business activities and the resultant shortfall in tax revenues.

In part, the report read, “Federally collected revenue in January 2021 was N807.54bn.

“This was 4.6 per cent below the provisional budget benchmark and 12.8 per cent lower than the collection in the corresponding period of 2020.

“Oil and non-oil revenue constituted 45.4 per cent and 54.6 per cent of the total collection respectively. The modest rebound in crude oil prices in the preceding three months enhanced the contribution of oil revenue to total revenue, relative to the budget benchmark.

“Non-oil revenue sources underperformed, owing to the shortfalls in collections from VAT, corporate tax, and FGN independent revenue sources.

“Retained revenue of the Federal Government of Nigeria was lower-than-trend due to the lingering effects of the COVID-19 pandemic.”

“At N285.26bn, FGN’s retained revenue fell short of its programmed benchmark and collections in January 2020, by 41.3 per cent and 7.5 per cent respectively.

“In contrast, the provisional aggregate expenditure of the FGN rose from N717.6bn in December 2020 to N770.77bn in the reporting period, but remained 14.4 per cent below the monthly target of N900.88bn.

“Fiscal operations of the FGN in January 2021 resulted in a tentative overall deficit of N485.51bn.”

The report noted that Nigeria’s total public debt stood at N28.03 trillion as of the end-September 2020, with domestic and external debts accounting for 56.5 percent and 43.5 percent, respectively.

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Economy

NNPC Supplies 1.44 Billion Litres of Petrol in January 2021

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Petrol Importation - investorsking.com

The Nigerian National Petroleum Corporation (NNPC) supplied a total of 1.44 billion litres of Premium Motor Spirit popularly known as petrol in January 2021.

The corporation disclosed in its latest Monthly Financial and Operations Report (MFOR) for the month of January.

NNPC said the 1.44 billion litres translate to 46.30 million litres per day.

Also, a total of 223.55Billion Cubic Feet (BCF) of natural gas was produced in the month of January 2021, translating to an average daily production of 7,220.22 Million Standard Cubic Feet per Day (mmscfd).

The 223.55BCF gas production figure also represents a 4.79% increase over output in December 2020.

Also, the daily average natural gas supply to gas power plants increased by 2.38 percent to 836mmscfd, equivalent to power generation of 3,415MW.

For the period of January 2020 to January 2021, a total of 2,973.01BCF of gas was produced representing an average daily production of 7,585.78 mmscfd during the period.

Period-to-date Production from Joint Ventures (JVs), Production Sharing Contracts (PSCs) and Nigerian Petroleum Development Company (NPDC) contributed about 65.20%, 19.97 percent and 14.83 percent respectively to the total national gas production.

Out of the total gas output in January 2021, a total of 149.24BCF of gas was commercialized consisting of 44.29BCF and 104.95BCF for the domestic and export markets respectively.

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