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Nigeria Sells $1 Billion Worth of Natural Gas to Portugal in 2022 – NNPC

The Federal Government of Nigeria has sold natural gas worth $1 billion to Portugal in 2022, according to the Nigerian National Petroleum Company (NNPC).

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The Federal Government of Nigeria has sold natural gas worth $1 billion to Portugal in 2022, according to the Nigerian National Petroleum Company (NNPC).

Mele Kyari, the Chief Executive Officer, NNPC, was quoted as saying at the Nigeria-Portugal Business and Trade Forum attended by President Muhammadu Buhari.

The NNPC boss said Portugal has been purchasing Nigeria’s energy for decades now and explained that President Buhari is on a state visit to Portugal for the second United Nations Ocean Conference.

He said “President Muhammadu Buhari is on a state visit to Portugal for the second United Nations Ocean Conference.

“On the sidelines of the event, President Muhammadu Buhari is leading a high-level Nigerian business delegation to the Nigeria-Portugal Business & Trade Forum.

“On the President’s delegation is the CEO NNPC Ltd, Mallam Mele Kyari, who highlighted the age-long energy partnership between the two countries, stressing that Nigeria supplies 70 per cent of energy imports to the European nation.”

On its Twitter page, the NNPC further quoted Kyari as saying, “This year alone, we have sold over a billion-dollar worth of natural gas to Portugal.”

NNPC boss also noted that there were ample opportunities to grow the energy supply to Portugal.

He told participants at the forum that Nigeria had invested in critical infrastructure to ensure domestic gas availability and increase gas supply to the international market.

 

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

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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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Electricity Subsidy Surges to N628.61bn in 2023, Discos Earn N1.08tn

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Amidst ongoing debates regarding Nigeria’s power sector and the financial dynamics surrounding it, the latest data from the Nigerian Electricity Regulatory Commission (NERC) has revealed significant figures concerning electricity subsidy and the earnings of power distribution companies (Discos).

According to the data obtained from NERC, the Federal Government’s expenditure on electricity subsidy soared to a staggering N628.61 billion in 2023.

This substantial subsidy expenditure indicates the government’s continued financial support to ensure electricity affordability for consumers across the nation.

Simultaneously, power distribution companies amassed a total revenue of N1.08 trillion during the same period.

This substantial revenue underscores the financial capacity of the Discos despite ongoing challenges within the power sector, including issues related to infrastructure, metering, and service delivery.

Analysis of the figures provided by NERC reveals a consistent increase in electricity subsidies throughout 2023.

In the first, second, third, and fourth quarters of the year, subsidies on power amounted to N36.02 billion, N135.23 billion, N204.6 billion, and N252.76 billion, respectively.

This steady rise in subsidy expenditure reflects the government’s commitment to bridging the gap between the cost-reflective tariff and the allowed tariff.

Conversely, power distribution companies witnessed notable revenue growth over the same period.

Despite concerns raised by consumers regarding service quality and reliability, Discos reported earnings of N247.09 billion, N267.86 billion, N267.61 billion, and N294.95 billion in the first, second, third, and fourth quarters of 2023, respectively.

This substantial revenue generation highlights the financial viability of the Discos within the current regulatory framework.

The surge in revenue by Discos has prompted calls from various stakeholders for improved service delivery and accountability within the power sector.

Consumers have expressed dissatisfaction with the quality of service provided by Discos, emphasizing the need for enhanced operational efficiency and infrastructure investment to address prevailing challenges.

In the absence of cost-reflective tariffs, the Federal Government continues to bear the burden of electricity subsidies to ensure affordability for consumers.

These subsidies primarily target power generation costs payable by Discos to the Nigerian Bulk Electricity Trading company, thereby supporting electricity generation and supply across the country.

Commenting on the subsidy expenditure for the fourth quarter of 2023, NERC highlighted the government’s policy to harmonize exchange rates and maintain end-user customer tariffs at approved rates.

This policy direction contributed to the increase in subsidy obligations, reflecting the government’s efforts to stabilize electricity prices amidst economic uncertainties.

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Port-Harcourt Refinery Set to Commence Operations by July End, IPMAN Discloses

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The Port-Harcourt refinery with a capacity of 210,000 barrels per day, is poised to begin operations by the end of July.

This announcement comes after several postponements and delays that have plagued the refinery’s revival efforts.

Chief Ukadike Chinedu, the National Public Relations Officer of the Independent Marketers Association of Nigeria (IPMAN), revealed this optimistic timeline on Monday.

According to Chinedu, the refinery’s revival is expected to stimulate economic activities, reduce petroleum product prices, and ensure adequate supply in the market.

The refinery, located in Port-Harcourt, comprises two units: an older plant with a refined capacity of 60,000 barrels per day and a newer plant with a capacity of 150,000 barrels per day.

Despite previous setbacks and delays, the Minister of State for Petroleum Resources, Heineken Lokpobiri, announced the mechanical completion and flare start-off of the refinery in December last year.

However, the refinery’s journey to resuming operations has been marked by challenges and setbacks. It shut down in March 2019 for the first phase of repair works, following the government’s engagement of technical advisors to oversee the refurbishment process.

Despite assurances from NNPC Limited’s Group Chief Executive Officer, Mele Kyari, in March 2024, stating that operations would commence within two weeks, the refinery faced further delays.

In an exclusive interview, Chinedu emphasized the extensive turnaround undertaken at the refinery, suggesting a complete overhaul rather than mere rehabilitation.

He expressed confidence in meeting the July deadline, citing round-the-clock efforts to ensure readiness for operations.

While acknowledging previous delays, Chinedu remained optimistic about the refinery’s imminent revival, emphasizing its potential to enhance competition in the petroleum sector and reduce product prices.

He pointed out that the refinery’s operationalization aligns with the impending commencement of petrol production by the Dangote Refinery, further emphasizing the potential benefits for Nigeria’s energy landscape.

However, Femi Soneye, the Chief Corporate Communications Officer of NNPC Limited, highlighted regulatory approvals from international bodies as the remaining hurdle to the refinery’s operational commencement.

Soneye reiterated that mechanical completion had been achieved, with all necessary infrastructure in place, awaiting regulatory clearance to commence operations.

As Nigeria navigates its energy transition and seeks to bolster local refining capacity, the imminent revival of the Port-Harcourt refinery signifies a significant milestone towards achieving energy sufficiency and economic growth.

With hopes pinned on the July deadline, stakeholders remain vigilant, anticipating the refinery’s long-awaited resurgence.

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