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Hundreds Protest Against TOTAL Across Africa

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Total Exploration - Investors King

Today, climate activists marked Africa Day by staging protests at Total’s petrol stations. The protests took place in Benin, Togo, the Democratic Republic of Congo, Uganda, Kenya, Egypt, Ghana and Nigeria. The protests highlighted Total’s human rights violations, greenwashing strategies and climate inaction.

Total is involved in controversial projects across the continent, notably the East African Crude Oil Pipeline (EACOP) and the Mozambique Liquified Natural Gas (LNG) project that have witnessed displacement of local communities from their ancestral land as well as several human rights abuses other issues that have been called out by activists and frontline communities.

Vanessa Nakate, a Ugandan activist, said: “We cannot drink oil. This is why we cannot accept the construction of the East African Crude oil pipeline. It is going to cause massive displacement of people, destruction of ecosystems and wildlife habitats. We have no future in extraction of oil because it only means destroying the livelihoods of the people and the planet. It is time to choose people above pipelines. It is time to rise up for the people and the planet.”

Andre Moliro, DRC activist, said: “Total’s fossil fuel developments pose grave risks to protected environments, water sources and wetlands in the Great Lakes and East Africa regions. Communities have been raising concerns on the impact of oil extraction on Lake Albert fisheries and the disastrous consequences of an oil spill in Lake Victoria, that would affect millions of people that rely on the two lakes for their livelihoods, watersheds for drinking water and food production.”

Landry Ninteretse of 350.org said, “At a time when the international scientific community is telling us that the world cannot absorb any new fossil fuel developments if we are to tackle the climate crisis, Total is still pushing for the construction of highly controversial pipelines such as the East African Crude Oil Pipeline and the Mozambique LNG that threaten to destroy the livelihoods of tens of thousands of people, while affecting a great portion of diverse ecosystems and adding millions of tons of carbon emissions yearly.”

Earlier in the year, more than 260 African and international organisations sent an open letter to 25 banks urging them not to finance the construction of the EACOP. Total issued statements on its website describing its environmental and social risk assessment and mitigation strategies for the EACOP and Tilenga oil extraction project as “rigorous” and claiming to act “responsibly and transparently” on the social and environmental issues related to the projects.

The #StopEACOP Alliance went ahead to issue a statement clarifying several misleading figures presented by Total such as the number of oil wells to be drilled within Murchison Falls National Park, and the number of project-affected people for Tilenga and EACOP.

Total seeks to position itself as a climate leader but chooses to ignore the massive climate risks posed by going ahead with its fossil fuel projects across Africa.

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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Dangote Refinery’s Power Production Dwarfs National Grid’s 11-Year Progress

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ossiomo

The stark contrast in power generation between Nigeria’s national grid and Dangote Refinery has come into sharp focus as Dangote Refinery generates twice the national power production.

Over the past eleven years, Nigeria has managed to add a mere 760 megawatts (MW) to its national grid, while the Dangote Refinery has outpaced this growth significantly with  1,500 MW in a much shorter timeframe.

For decades, Nigeria has grappled with chronic power shortages, an issue that has repeatedly dominated election campaigns and policy debates.

Data from the Nigeria Electricity System Operator revealed that power delivery from Generation Companies (Gencos) to Distribution Companies (Discos) via the Transmission Company of Nigeria (TCN) has seen only a modest increase.

From an average of 3,400 MW in November 2013, it has risen to 4,160 MW as of June 12, 2024, marking a 22 percent increase.

In stark contrast, the Dangote Refinery, which began construction in 2018, now produces 1,500 MW of power for its operations.

This significant output not only surpasses the national grid’s decade-long expansion but also emphasizes the private sector’s ability to address Nigeria’s power challenges more efficiently.

“We don’t put pressure on the grid. We produce about 1,500 megawatts of power for self-consumption,” stated Aliko Dangote at the Afreximbank Annual Meetings and AfriCaribbean Trade & Investment Forum in Nassau, The Bahamas.

This development underscores concerns regarding the slow pace of growth in Nigeria’s power sector despite substantial investments and an 11-year-old privatisation effort.

“The government and some operators in the sector may claim there has been some form of growth since 2013, but in actual terms, how many people are benefiting from the privatised power sector?” questioned Charles Akinbobola, a senior energy analyst at Sofidam Capital.

He added, “The challenge of the power sector has not entirely been the scarcity of funds. Several trillions of naira have been pumped into that industry. The sector has been plagued by the shortcomings of its managers.”

Comparatively, Nigeria’s power production capacity of 13,000 MW falls significantly short of South Africa’s 58,095 MW, despite having a similar-sized economy and a quarter of Nigeria’s population.

The ageing national grid, however, delivers only about 4,000 MW to over 200 million citizens—roughly the power consumption of Edinburgh’s 548,000 residents.

Other African nations have made more significant strides in addressing their power needs.

Egypt, for instance, added 28,229 MW to its national grid between December 2015 and December 2018, achieving a total installed capacity of 58,818 MW.

This was accomplished through a fast-track project and a substantial partnership with Siemens, adding 14,400 MW in just 2.5 years.

The sluggish growth of Nigeria’s power sector is not just a technical issue but a significant economic one. Rising energy costs and unreliable power supply have disrupted productive activities, forcing many factories to self-generate more than 14,000 MW of electricity.

According to the Manufacturers Association of Nigeria, member companies spent N639 billion on alternative energy sources between 2014 and 2021, further highlighting the inefficiencies within the public power supply system.

“The power sector’s inefficiencies cost consumers billions of naira and stifle economic growth,” noted Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise. “There are issues of technical and commercial losses which are yet to be addressed. These inefficiencies are costs that consumers are compelled or expected to pay for as part of the cost recovery argument.”

The stark contrast in power generation between the Dangote Refinery and the national grid serves as a wake-up call for Nigeria’s power sector.

It underscores the urgent need for comprehensive reforms, better management, and increased investment to meet the growing energy demands of the nation’s burgeoning population.

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Power Grid Collapse Plunges Nigeria into Darkness Early Monday

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Electricity - Investors King

Nigeria was thrown into darkness once again as the nation’s power grid collapsed early Monday morning.

The collapse occurred at exactly 1:47 am, according to officials in the power sector.

The incident coincides with heightened tensions as the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC) commenced an indefinite workers’ strike to demand a new national minimum wage.

The strike, which began Monday, has raised concerns about the potential for further disruptions across various sectors of the economy.

In response to the strike, Lateef Fagbemi, the Attorney-General of the Federation and Minister of Justice, criticized the labor unions’ actions.

In a letter dated June 1, 2024, Fagbemi stated that the strike violated a subsisting National Industrial Court order restraining the unions from proceeding with such actions.

He said the strike could lead to significant disruptions, including the recent power grid failure.

Despite attempts by the National Assembly leaders to mediate and prevent the strike, the meeting held on Sunday night ended without a resolution.

The meeting was chaired by Senate President Godswill Akpabio and Speaker of the House of Representatives Tajudeen Abbas and attended by NLC President Joe Ajaero and TUC President Festus Osifo. The unions remained firm on their decision to proceed with the strike.

Impact on Everyday Life

The blackout has had an immediate and significant impact on millions of Nigerians, disrupting daily life and business activities.

Hospitals, schools, and businesses are struggling to cope without electricity, exacerbating an already challenging situation for many citizens.

Minister of State for Labour Nkeiruka Onyejeocha reiterated the government’s position, stating that it could not afford to pay more than N60,000 as the new minimum wage, which she noted was a 100 percent increase from the current rate.

This offer, however, has been deemed insufficient by labor leaders.

Ulterior Motives and Unfeasible Demands

Bayo Onanuga, special adviser to President Bola Tinubu on Information and Strategy, suggested that the labor unions might have ulterior motives behind their strike, criticizing the wage demands as unrealistic for both federal and state governments.

“The minimum wage offer they presented is simply not feasible given the current economic constraints,” Onanuga stated.

He urged labor leaders to reconsider their stance for the sake of national stability.

Broader Implications

The power grid collapse is not just an isolated technical failure but a reflection of deeper systemic issues within Nigeria’s energy infrastructure.

The recurring outages highlight the urgent need for comprehensive reforms in the power sector to ensure reliable and consistent electricity supply.

As the nation grapples with this latest blackout, the government and labor unions remain at an impasse, with both sides entrenched in their positions.

The outcome of this dispute will likely have far-reaching implications for Nigeria’s economic stability and growth.

In the meantime, millions of Nigerians are left to cope with the immediate fallout of the power grid collapse, hoping for a swift resolution to both the strike and the ongoing energy crisis.

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Oil Prices Stable Amid Federal Reserve’s Talk of Interest Rate Tightening

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Crude oil - Investors King

In a landscape where global oil markets often sway with the slightest economic shifts, stability can be a rare commodity.

However, amidst discussions from the U.S. Federal Reserve regarding potential interest rate adjustments, oil prices have remained surprisingly steady.

Brent crude oil, against which Nigerian oil is priced, gained 10 cents, or 0.1% rise to $82.00 a barrel, while U.S. West Texas Intermediate (WTI) crude oil edged up 7 cents to $77.64 a barrel.

The Federal Reserve’s release of minutes from its recent policy meeting unveiled deliberations on the possibility of raising interest rates to combat persistent inflationary pressures.

The minutes stated, “Various participants mentioned a willingness to tighten policy further should risks to inflation materialize in a way that such an action became appropriate.”

Such discussions surrounding interest rates can have a profound impact on oil demand. Higher interest rates typically result in increased borrowing costs, potentially constraining funds that could otherwise stimulate economic growth and, consequently, oil consumption—particularly in the United States, the world’s largest oil-consuming nation.

Additionally, the Energy Information Administration’s report indicating a 1.8 million barrel rise in U.S. crude stocks last week, as opposed to an anticipated draw of 2.5 million barrels, added a layer of complexity to the market dynamics.

This unexpected increase in inventory weighed on market sentiment, despite ongoing efforts to balance supply and demand.

Furthermore, global physical crude markets have been grappling with subdued refinery demand and abundant supply, exacerbating the pressure on oil prices.

Analysts from Citi highlighted recent market softness, attributing it to weaker data encompassing rising oil inventories, tepid demand, and refinery margin weakness, compounded by the looming risk of production cuts.

Russia’s announcement that it surpassed its OPEC+ production quota in April due to “technical reasons” added another dimension to the market narrative.

The Russian Energy Ministry revealed plans to present a compensation strategy to the Organization of the Petroleum Exporting Countries (OPEC) Secretariat shortly.

Against this backdrop, anticipation mounts ahead of the OPEC+ meeting scheduled for June 1, where crucial decisions regarding production cut levels will be deliberated.

Despite uncertainties surrounding the meeting’s outcome, industry experts foresee challenges in significantly tightening the market in the near term, potentially leading to a rollover of existing voluntary cuts.

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