All Posts in "Day: February 10, 2024"

Our Projects Will Add Value To Nigeria’s Economy-Shell

Mohammed Shosanya

The Chairman of Shell Companies in Nigeria (SCIN), Mr. Osagie Okunbor conveyed the company’s determination to take the Final Investment Decision (FID) on some of the major projects in 2024, which would benefit the Nigerian oil and gas industry and the national economy.

He spoke when when he led the delegation of Shell Companies in Nigeria (SCIN),on a visit the Nigerian Content Development and Monitoring Board (NCDMB) Engr. Felix Omatsola Ogbe

He clarified that the planned divestment by Shell Petroleum Development Company (SPDC) would not affect any contract duly entered by the company, while the major projects in the pipeline, especially the gas projects would be developed under SNEPCo

He added that the divestment was a business realignment and would only affect the shareholding structure of the company, while the operations and staff would remain intact.

Speaking on the new projects, Okunbor indicated that the Bonga North project would be a tie-back project that would unlock about 350 million barrels of oil equivalent and extend the life of Bonga Floating Production Storage and Offloading (FPSO) for another 15 years.

He mentioned that the company had made appreciable progress in the plans for HI and HA projects which would supply 50 percent of the gas required for the successful operation of the Train 7 project currently being developed by the Nigeria Liquified Natural Gas (NLNG) Company.

He underscored the need to develop the gas projects speedily, to avoid delaying the Train 7 operation date. While thanking NCDMB for its support for the company’s various projects, Okunbor requested the Board to fast-track the approvals on the new projects to enable the projects to proceed to full execution.

He stated that the economics of the projects were challenging, making it imperative to carefully manage the expenditures for in-country and out-of-country scopes of the project.

The Country Chair also congratulated the Executive Secretary on his appointment and conveyed the enduring support of Shell Companies in Nigeria to the delivery of the Board’s mandate and continued performance as the number one federal agency in the country.

He also commended the Executive Secretary for his avowed vision to improve the speed of the Board’s approval processes to enable the development of new oil and gas projects.

In her comments, the Managing Director of SNEPCo, Mrs. Elahor Aiboni reiterated the company’s plan to develop the Bonga North project as fast as possible, to increase the country’s crude oil production.

admin by — February 10, 2024 in Oil&Gas 0
NMDPRA Right To Collect Levies On Petroleum Products-Court

Mohammed Shosanya

A Federal High Court has affirmed the power of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA or Authority) to impose and collect levies on petroleum products sold in Nigeria.

In an action filed by IHS Nigeria Limited and INT Towers Limited against the NMDPRA, the plaintiffs argued that they are not liable to pay statutory 0.5% levies for the ‘Authority Fund’ and the ‘Midstream and Downstream Gas Infrastructure Fund’ respectively on petroleum products they import.

According to the plaintiffs, their products are not ‘sold in Nigeria’, but rather used for their respective business operations, and therefore not in the category of petroleum products subject to the levies.

They also sought for the court to declare two key regulations for the implementation of the PIA void and illegal – the Midstream and Downstream Petroleum Operations (“MDPO”) Regulations 2023 (which define the concept of ‘sold in Nigeria’) and the Petroleum (Transportation and Shipment) (“PTS”) Regulations 2023 (which sets out information the NMDPRA may demand from a permit holder) – on the basis that they overreach sections 47(2) and 57(7) PIA and amount to a breach of the constitutional right to personal property respectively.

Delivering verdict in the suit recently,Justice Inyang Ekwo of the Federal High Court Abuja Division, agreed with the arguments of the NMDPRA counsel Dr. Emeka Akabogu, and affirmed the validity of the Midstream and Downstream Operations Regulations 2023 as well as the Petroleum (Transportation and Shipment) Regulations 2023.

The court held that the regulations neither overreach nor are in conflict with sections 47(2)(c) and 57(7)(a) of the PIA which provide for payment of 1% levy on petroleum products and natural gas sold in Nigeria.

It found that the definition of ‘sold in Nigeria’ covers three distinct situations – where the goods are sold “fob” in Nigeria or its territorial waters, where they are loaded or offloaded for sale within a wholesale point in Nigeria, or where the transaction originates, occurs or is concluded in Nigeria.

admin by — February 10, 2024 in Oil&Gas 0
Tinubu’s Economic Strategy Has Failed-Senators

Mohammed Shosanya

Senators on Friday, lamented the prevailing economic crisis in the country.

At a meeting with President Bola Tinubu’s economic team in Abuja,the lawmakers lambasted the Federal Government’s strategy, stressing that it wasn’t working.

Senator Sani Musa (APC, Niger) regretted that there was lot of lapses in the economy, including rising inflation; 70 percent of Nigerians can’t boast of 3 square meal.”

He also lamented that unemployment is at about 37 percent, adding that “hunger is poverty and this leads to a spike in insecurity. We must tell ourselves, these policies of government are not working.

Why would you allow your foreign exchange to skyrocket? This is never done.”

Speaking on insecurity,he said investors would definitely shun Nigeria as an investment destination.

“How many foreign direct investments have we attracted as a country, many companies have divested from the country,” he maintained.

He also spoke on the previous loans,saying that the National Assembly has approved foreign loans for the government but they have not reflected on the economy.

“We have taken a lot of loans, repatriated looted funds from abroad into the country but cannot say what the money was used for,” he stressed.

He further asked the effects of the $3.3 loan taken by the government to cushion the effect of the volatility of foreign exchange, even as he berated spending as huge as N33 trillion on Ways and Means.

He said, “we are just printing money. He said this will surely increase at the end of the year if it remains at 9 percent rate.”

On his part, Sen. Orji Uzor Kalu (APC, Abia) lamented that manufacturing and farming sectors are dead with bandits and herdsmen taking over farms .

He said the CBN should stop the Dollarisation of the economy.

He called for the abolition of Dollar transactions in the country. He said in South Africa nobody buys anything with Dollar, as he asked what the CBN will do to encourage foreign direct investment.

Senator Ostia Izunaso said the CBN has no capacity to track the currency, adding that while there is scarcity of cash in banks, billions of naira are stashed in private homes.

He said CBN give dollars to commercial banks but they engage in illicit transaction with those who mop up the dollar and create artificial scarcity in the market

“No liquidity in the system, the CBN should apply for a bailout from the World Bank,” he added.

Asking the CBN to answer how much of foreign loans has been approved by the National Assembly, Sen. Adamu Aliero questioned how much has been accessed, and how much has been allocated to sectors for which they were obtained?

He said Nigeria has capacity for food sufficiency, therefore, there is no excuse for food importation, as Sen. Olamilekan Adeola, charged the CBN to start its avowed transparency by promptly submitting its budget proposals to the National Assembly.

He punctured the CBN for playing an extra-judicial role such as committing much of the nation’s funds to the anchor borrower scheme, stating that “the CBN has suddenly become the largest producer of rice in the country.”

admin by — February 10, 2024 in News 0
CBN’s Interventions In Forex Stability Earns Nigerian Market $1bn,Says Cardoso

Mohammed Shosanya

The Governor of the Central Bank, Yemi Cardoso, says $1bn has come into the Nigerian market in the past few days through the bank’s interventions in stabilizing foreign exchange rates in Nigeria

He also said the policies taken so far by the apex bank to stabilize foreign exchange rates have been yielding positive results.

He disclosed these during a briefing of the Joint Senate Committee on Finance, Banking, Insurance, and Financial Institutions in Abuja on Friday.

He noted that these measures would help to stabilise the foreign exchange rates and minimize the distortion that high exchange rates have on inflation, saying they are closely related.

He said, “We have already begun to see shifts in the positive direction. Indeed they (CBN measures) have already started yielding early results with significant interest from foreign portfolio investors which was a concern. That has already begun to supply the much-needed foreign exchange to the economy.

“For example, upward of the past few days, we have had over $1 billion that has come into the market, and this quite frankly has answered the question of if our policies are working,” he added.

He said that with the numbers available, he can say that the market has been responding to the policies they have put in place.

He added that measures aimed at improving US dollar supply in the Nigerian economy have significant potential for taming the volatility of the exchange rate and, in turn, moderating inflation.

He, however, said that for these measures to be sustainable, Nigeria must, as a country, moderate our demands for foreign exchange.

He maintained that the genuine issue impacting the exchange rate is the demand for US dollars for business and personal needs.

The CBN governor also assured that inflation is expected to decline this year using the inflation targeting framework and moderate to 21.1 percent.

admin by — February 10, 2024 in Banking&Finance 0