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Dangote/BUA Rift: Edo Shuts Obu Mines



economic woes
  • Dangote/BUA Rift: Edo Shuts Obu Mines

The Edo State Government has ordered the immediate shutdown of the mines in dispute between the Dangote Group and BUA International Limited at Obu in Okpella community, Etsako East Local Government Area of the state.

This just as leaders of the community have called on President Muhammadu Buhari to intervene in the matter in order to ensure an amicable resolution and avert a crisis.

Governor Godwin Obaseki, who announced the closure of the mines during a meeting with some leaders from Okpella at the Government House, Benin City on Monday, explained that the decision was based on a directive from the Federal Ministry of Mines and Steel Development, and the need to prevent the breakdown of law and order in the area.

There had been claims and counter-claims about the ownership of the mines by the Dangote Group and BUA Group.

The Executive Director, Dangote Group, Mr. Devakumar Edwin, had in a statement on Sunday accused the BUA Group of illegal mining limestone deposits in its (Dangote) Mining Lease No. 2541.

However, BUA, through its Group Head of Corporate Communications, Otega Ogra, not only denied the allegation, but also accused the Dangote Group of ignoring a judicial process on the matter, adding that the firm had mining rights to the sites with ML 18912 and ML 18913.

But Obaseki said that the state government was following the rule of law by ensuring that laid down procedures for addressing such a dispute were adhered to.

He explained, “What we understand as a government is that there is a dispute or claims between two parties over an existing mining right and the Mining Act of 2007; the Federal Ministry of Mines, through its cadastre office, decides on who to and how to issue leases.

“In this particular case, there are multiple claims and they have now gone to court. We have documents from the Federal Ministry of Mines instructing that the party currently mining that particular site should vacate pending the outcome of the decision in court.

“So, the position of the Edo State Government today is that the court orders must be obeyed. The Federal Government’s instructions must be obeyed. That mine should be shut until the determination of the suit in court. Whoever the court says owns it will now have claim to the mine.”

The governor also allayed the fear that a total shutdown of the site would affect revenue generation as the factory located therein would still be functional.

Obaseki added, “My understanding is that this is one of several mines available to investors and I am not sure that it will affect the revenue, because I am not sure it will lead to a shutdown of that particular factory.

“In any case, we have to understand that both companies are currently building factories. BUA is expanding, Dangote is building and there is enough limestone in the area to feed all the plants. So, I am sure it is going to be resolved.”

Meanwhile, the affected community maintained that Obu was located in Edo State and not in Kogi State as was allegedly described by the ministry.

The community in an open letter signed by its lawyer, Mr. Ayuba Giwa, added, “In the result, the Presidency is prayed to do justice to all parties in this matter, including and particularly Okpella, where the host community of Komunio belongs, and in accordance with the Mining Cadastre Office’s new template for processing of consent for the acquisition of mineral rights/titles in Nigeria.”

In its reaction to the latest development, BUA said in a statement on Monday, “We heard of the alleged closing down of the Obu mines in Okpella, Edo State by the Governor of Edo State. Whilst this remains in the territory of hearsay, our position on this matter remains very clear. Just as the Edo state Government said in its statement, this is an issue no state government has jurisdiction over as it is a federal Issue.

“It is, however, interesting to note that the mine under contention, ML2541, has been claimed repeatedly by the Ministry of Mines and Dangote to be in Okene, Kogi State. Thus, we are curious and are at a great loss as to why the governor of Edo State is closing down a mine in Edo State, which has been claimed by the other parties involved to be outside his state in Okene, Kogi State and which the purported ML2541 licence also states clearly.

“The Ministry has written us prior and our response was published in our open letter to the President of the Federal Republic of Nigeria on December 4, 2017. This case remains in a competent court of jurisdiction, which has ordered all parties – BUA, Dangote, the Ministry of Mines and others – to maintain the status quo and we will continue to abide by the dictates of the court as a responsible corporate citizen.

“We are, however, yet to receive some form of official communication asking us to close our mining sites ML18912 and ML18913 in Edo State, thus this alleged closing down report still remains in the territory of hearsay. We will respond accordingly when and if we get an official communication from the proper authorities.”

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


Rivers State Partners Shell Nigeria on Assa North Gas Project



Oil downturn

Rivers State, Shell Nigeria Partner on Assa North Gas Project

Rivers State and the Shell Petroleum Development Company of Nigeria Limited (SPDC) have partnered to build SPDC’s Assa North Gas project, with a capacity of 300 million standard cubic feet of gas per day.

According to the people familiar with the project, it has the potential to be one of the largest domestic gas projects in Nigeria when completed.

Mr. Eloka Tasie-Amadi, the State Commissioner for Chieftaincy and Community Affairs, who spoke at the inauguration event, urged the comrade Orikoha Ekwueme-led newly elected officials of the Cluster Development Board to use the opportunity of leadership to make positive impacts that will improve living standards in their communities.

The state government is always available to support you. Always speak with your people, including the Community Trust Committees (which were also newly inaugurated). Adequate communication will ensure the buy-in of all your stakeholders.

“Leadership is more of sacrifice; not an opportunity for personal benefit”, he said.

Also, speaking was Mr Igo Weli, the General Manager External Relations, SPDC, said, “The Global Memorandum of Understanding (GMoU), that you signed today, sets the framework for a long-term partnership between SPDC JV and the Egi/Igburu Cluster. The GMoU runs on the principle of community-led development. Today, SPDC JV commits to providing funding to help you realise your community development aspirations.

Represented at the ceremony by SPDC External Relations Manager for Projects and Opportunities, Dr Banji Adekoya, he asked the CDB to “be prudent and implement projects and programmes that will deliver maximum benefits to the Egi/Igburu communities. Note that government, SPDC JV, and the communities that you represent will hold you accountable for the judicious utilisation of the development funds.”

“With the inauguration, SPDC reiterates the company’s commitment to the Assa North Gas Project and to making it an exemplary one, particularly in Nigeria’s quest for energy sufficiency, for power generation and industrialisation,” he said.

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Electricity Consumers, Hoteliers, Others Kick Against Petrol Price, Power Tariff Hikes




Groups Kick Against Increase in Petrol Price, Power Tariff

The Network for Electricity Consumers Advocacy of Nigeria, the Nigerian Hotels Association, the Federation of Tourism Associations of Nigeria, Hotel Owners Forum, Abuja, and Power Up Nigeria have all kicked against the recent increases in power tariff and petrol price.

In a joint press conference held in Abuja on Friday, the groups rejected the increase and demanded an urgent reversal, saying the economic hardship imposed on Nigerians and businesses in the country by the COVID-19 pandemic would worsen if the increases in electricity tariff and petrol remains.

The speech jointly signed by presidents of NHA, FTAN, HOFA, Power Up Nigeria and read by the NECAN Secretary, Uket Obonga, the groups said it was sad that the Federal Government had chosen to compound the suffering of the Nigerian people at a time when the rest of the world are making efforts to ease the impacts of COVID-19 on their citizens.

They said, “It is sad to note that while other nations are enacting policies and taking measures to cushion the hardship imposed on their citizens by the COVID-19 pandemic, the Federal Government has chosen to place an unpardonable burden on Nigerians.

“This burden is not only the electricity tariff increase but also the hike in the pump price of petrol at a time that the people are suffocating under a distressed economy.”

They added, “It is very unfortunate that the Federal Government could allow itself to be misled into believing that tariff increase is the silver bullet that will shoot the sector revenues to Eldorado.”

The groups further stated that the cause of weak revenue in the power sector had not been addressed, neither is the nation’s low internally generated revenue addressed.

According to the groups, this was not the first time power distributors companies were pushing for a tariff increase, but the past Multi Year Tariff Order reviews that ended up increasing the price of electricity did not yield the desired result.

They said, “Recall that as soon as the MYTO 2015 order came into effect on February 1, 2016, the power distribution companies began another quest for further increase.

“They flagrantly disregarded the provisions of the MYTO path and energy charges contained therein, as the Discos went ahead to choose which tariff rate to use in determining bills given to the customers.

The groups argued that the incessant request for tariff increase had become a hypothetical exercise rather than the solution to the sector’s revenue problem.

We, therefore, wish to state categorically that we reject the September 1, 2020 tariff increase as ordered by the Nigerian Electricity Regulatory Commission,” they said.

They added, “We call on the Federal Government to rescind the increase because we note that there is nothing put on the ground to cushion the effect of the dual increase of the end user tariff and the pump price of petrol.”

Meanwhile, the Nigerian Electricity Regulatory Commission (NERC) has approved power distribution companies (DisCos) to start collecting 87.9 percent of the recently raised electricity tariff from consumers in the first half of 2021.

This was disclosed in the latest tariff review documents forwarded to the 11 power distribution companies in the country. Also, DisCos were approved to start collecting 100 percent of the new tariff from the second half of 2021.

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Nigeria’s Electricity Consumers to Start Paying Full Rates from H2 2020




Electricity Consumers to Pay Full Rates from July 2021

The Nigerian Electricity Regulatory Commission has approved power distribution companies to collect an average of 87.9 percent of the recently raised electricity tariff from consumers in the first half of 2021.

In the latest tariff review documents issued to the 11 power distribution companies, power distribution companies had been approved to collect 100 percent of the new tariff from July to December 2021.

The approved new collection rates for the Discos means that Nigeria’s electricity consumers would be required to pay higher tariffs starting from the second half of 2021.

This is coming despite Nigerians kicking against the increase implemented on September 1, 2020. Nigerians have declared the numerous increases by President Muhammadu Buhari as anti-people policy, saying the administration continues to compound the people’s burden despite COVID-19 negative impacts on them.

A few numbers of Nigerians have staged protests to compel the administration to revise increases on Value Added Tax, pump price and electricity tariff because of the ongoing economic uncertainties and weak macroeconomic data after the National Bureau of Statistics (NBS) reported that the inflation rate rose above 13 percent, unemployment rate hits 27.1 percent and general plunged in economic activities and earnings of the Nigerian people.

However, the approval means DisCos will collect an average of 88 percent tariff in the first half of 2021 and up it to 100 percent in the second half of 2021 as contained in the NERC’s directive.

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