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Nigeria to Reduce Crude Oil Production Cost to $10 Per Barrel

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Mele Kyari

NNPC to Reduce Cost of Crude Oil Production to $10 Per Barrel

Mallam Mele Kyari, the Group Managing Director, the Nigerian National Petroleum Corporation (NNPC), has said the corporation is working on lowering crude oil cost of production from $17 per barrel to about $10 per barrel.

Kyari disclosed this at Seplat Energy Summit 2020, titled “The Impact of Global Energy Transition on African Economies” held on Thursday.

He said “We are making efforts to drive down the cost of crude oil production to $10 per barrel. We are doing that mindful that it doesn’t stifle investments or hamper the growth of local content and capacity.”

Nigeria’s high cost of production compared to other oil-producing countries like Saudi Arabia and Iraq that are producing at around $5 to $6 per barrel has rendered the demand for the nation’s oil uncompetitive in recent months following over 60 percent decline in global oil prices.

The high cost of production continues to hurt Nigeria’s revenue generation and ability to service its growing debt, especially with crude oil now trading between $40 and $43 per barrel.

Experts have said Nigeria must broaden its revenue generation by taking advantage of its vast gas resources and improve tax collection efficiency.

Kyari said “Aside driving down the cost of production, we are also focusing on gas development. We have huge gas resources which can be harnessed to power industries and engender development.”

“It is very important that we have connectivity in Africa in terms of economic activities and oil and gas infrastructure. That is why we are working hard to have the Trans African Gas Pipeline and to expand the West African Gas Pipeline.”

Other speakers at the summit were Mr. Mike Sangster, MD, TOTAL E&P Nigeria; Mrs. Audrey Joe- Ezigbo, President, Nigerian Gas Association, and Mr. Roger Brown, Seplat CEO Designate.

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

Prepaid Meter is Free, Buhari Warns DisCos, Agents

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prepaid meter

President Muhammadu Buhari once again warned Power Distributing Companies (DisCos) and their agents selling prepaid meters to electricity customers against the Federal Government directive that meter is free.

Ahmed Rufai Zakar, the Special Adviser to the President on Infrastructure, who represented Buhari at the FGN/NLC-TUC ad-hoc committee on electricity tariff stakeholders held in Ibadan, Oyo State on Wednesday, said President Buhari understood people’s concerns on issues surrounding electricity and was determined to curb and deal with unscrupulous individuals in the power sector.

He said, “We have made it very clear through the regulators direct order as well as intervention from the Ministry of Power that the meters are to be provided to Nigerians at no cost.

“Even for meters that were paid for, there is the directive from the regulator to the discos that they would need to find a way to reimburse those citizens over time.

“In cases where we find any disco or disco representative selling the meters or exploiting Nigerians to be able to get meters by paying, we would take the full measures of the law.

“The President has mandated that these meters must be free. We have also said that they must come from local manufacturers.

“This would create jobs and revive our industry.”

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Economy

Nigeria’s Real Estate Sector Shrinks by 8.06% in the Third Quarter -NBS

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Economic uncertainty plunged Nigeria’s real estate sector by 8.06 percent in the third quarter of the year, according to the National Bureau of Statistics (NBS).

Nigeria’s statistics office said “In nominal terms, real estate services recorded a growth rate of –8.06 per cent in the third quarter of 2020, indicating a decline of –11.78 per cent points compared to the growth rate at the same period in 2019, and by 9.12 per cent points when compared to the preceding quarter.

“Quarter-on-quarter, the sector growth rate was 18.92 per cent.

“Real GDP growth recorded in the sector in Q3 2020 stood at -13.40 per cent, lower than the growth recorded in third quarter of 2019 by –11.09 per cent points, but higher relative to Q2 2020 by 8.59 per cent points.

“Quarter-on-quarter, the sector grew by 17.15 per cent in the third quarter of 2020.

“It contributed 5.58 per cent to real GDP in Q3, 2020, lower than the 6.21 per cent it recorded in the corresponding quarter of 2019.”

Nigeria’s economy contracted by 2.48 percent in the first nine months following a 6.10 percent and 3.62 percent contraction in the second and third quarters respectively.

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Economy

Nigeria Requires N400 Billion Annually to Maintain Federal Roads -Senator Bassey

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lekki

The Chairman of the Senate Committee on road maintenance, Senator Gersome Bassey, on Friday said Nigeria requires about N400 billion annually to maintain federal roads across the country.

The Senator, therefore, described the N38 billion budgeted for road repairs in the 2021 proposed Budget as grossly inadequate. According to him, nothing meaningful could be achieved by the Federal Roads Maintenance Agency (FERMA) with such an amount.

He said, “For the 35 kilometres federal roads in the country to be motorable at all times, the sum of N400bn is required on yearly basis for maintenance.”

Bassey “What the committee submitted to the Appropriation Committee in the 2021 fiscal year is the N38bn proposed for it by the executive which cannot cover up to one quarter of the entire length of deplorable roads in the country.

“Unfortunately, despite having the power of appropriation, we cannot as a committee jerk up the sum since we are not in a position to carry out the estimation of work to be done on each of the specific portion of the road.

“Doing that without proposals to that effect from the executive, may lead to project insertion or padding as often alleged in the media.”

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