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Nigeria Cuts Benchmark Rate as African Peers Tighten Policy

Nigeria’s central bank reduced its benchmark interest rate for the first time in six years, diverging from its counterparts in most of Africa that have tightened monetary policy in the face of weakening currencies. The key rate was cut to 11 percent from a record high of 13 percent, Governor Godwin Emefiele told reporters on Tuesday in Abuja, the capital. None of the 20 economists surveyed by Bloomberg predicted such a large cut, and most expected no change at all. Monetary policy in Nigeria is becoming harder to predict as the central bank turns to unconventional tools to protect its currency and boost economic growth. Emefiele has imposed foreign-exchange restrictions in Nigeria, Africa’s biggest crude producer, to keep the naira stable amid a plunge in oil revenue. “What we’ve decided to do at this meeting is that we must stimulate growth,” Emefiele told reporters after the decision. “We don’t […]

Posted On : Published By : Tom Whipple
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Glencore seals Libyan oil deal in scramble for profits

The logo of commodities trader Glencore is pictured in front of the company’s headquarters in Baar, Switzerland, September 30, 2015. Trading house Glencore has secured a deal to buy as much as half of the oil Libya is currently exporting, market sources said, as it looks to boost trading to help offset flagging profits from mining. For war-torn, cash-strapped Libya it offers steady sales to international buyers and shifts to Glencore the risks associated with loading oil and chartering vessels at ports where operations have become more unpredictable due to the conflict in the north African nation. Under the arrangement with Libya’s state-run National Oil Corp. (NOC), which began in September, Glencore loads and finds buyers for all the Sarir and Messla crude oil exported from the Marsa el-Hariga port near the country’s eastern border with Egypt. While Libyan oil exports peaked at 1.6 million barrels per day, battles […]

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Libya

Libya joined the Organization of the Petroleum Exporting Countries (OPEC) in 1962, a year after Libya began exporting oil. 1 Libya holds the largest amount of proved crude oil reserves in Africa, the fifth-largest amount of proved natural gas reserves on the continent, and in past years was an important contributor to the global supply of light, sweet (low sulfur) crude oil, which Libya mostly exports to European markets. Libya’s hydrocarbon production and exports have been substantially affected by civil unrest over the past few years. In 2011, Libya’s hydrocarbon exports suffered a near-total disruption during the civil war, and the minimal and sporadic production that occurred was mostly consumed domestically. In response to the loss of Libya’s oil supplies in the summer of 2011, the International Energy Agency (IEA) coordinated a release of 60 million barrels of oil from the emergency stocks of its member countries through the […]

Posted On : Published By : Tom Whipple
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Nigeria: Fuel Scarcity Grounds Businesses in Kaduna

Business activities have drastically slowed down at the popular Gumi market and other business places in Kaduna over fuel scarcity. Most business owners are witnessing low patronage due to the scarcity as fuel is now sold for between 170 and 200 naira per litre and only at the black market. No filling station was selling fuel at the popular Ahmadu Bello way and Constitution road. A shop owner, who gave his name as Alhaji Umar, said, "In just five days, prices of foodstuff have tripled in Kaduna." "Three times I visited the market this week, price of food stuff has risen drastically. "Example, a tin of milk that I sell here for 90 naira is now N120 all in just five days." A resident, who also is a fuel attendant at the Shema filling station, Tudun Wada, told PREMIUM TIMES that the station had been out of fuel since […]

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Egypt’s Dollar Crunch Siphoning Steam From Renewable Energy Plan

Egypt’s foreign-currency crunch has solar developers concerned about financing new power plants. Cairo Solar has lined up a $51 million loan from the International Finance Corp. for a planned 50-megawatt solar farm. Chairman Hisham Tawfik says he’s worried about paying it back because the government has guaranteed payment for the electricity it will produce — in Egyptian pounds. It’s been more than four years since the uprising that toppled President Hosni Mubarak. The political upheaval has scared away outside investors and tourists, and Egypt’s foreign reserves have dwindled to $16.6 billion, less than half 2010 levels. The central bank has imposed restrictions that make Tawfik’s pounds difficult to convert to other currencies. “How can I be happy if I have a lot of Egyptian pounds in the bank and I can’t change them to dollars,” Tawfik, who is also on the board of the Egyptian Renewable Energy Association, said […]

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Africa Oil Boom Fades as $50 Crude Shuts Door on High-Cost Deals

Investment decisions made on less than 10% of discoveries “On the brink of a boom,” was the banner on PricewaterhouseCoopers LLP’s review of Africa’s oil industry 16 months ago. Now, oil below $50 has made more than two out of three investment projects on the continent non-viable. “Capital markets are effectively closed to the oil and gas industry” in Africa, Tony Hayward, former head of BP Plc and now chairman of Genel Energy Plc, said at a conference in Cape Town last month. “A decade of exploration, with billions of dollars invested and only limited commercial success.” When six of the 10 biggest global oil discoveries in 2013 were made in Africa, it underlined the potential of the energy riches that had lured companies from Royal Dutch Shell Plc to Exxon Mobil Corp. Governments have been slow to react as the slump in crude makes the royalties charged from […]

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Nigeria: Minister Orders DPR to Distribute Hoarded Fuel Free to Nigerians

The Minister of State for Petroleum Resources, Ibe Kachikwu, on Tuesday directed the Department of Petroleum Resources to seal off fuel stations found to be hoarding petroleum products and dispense the petroleum free to the public. The Minister gave the directive after a working visit to some retail outlets in Abuja. "I have instructed DPR that if they discover any fuel station involved in hoarding, they should sell the products for free to customers around there," he said. "It is not just sealing the station that is the answer. It is penalizing them when they do these things. I hope the message goes out loud and clear." Meanwhile, the Minister has scheduled a session on Wednesday with key operators in the downstream sector of the petroleum industry, namely the Major Marketers Association of Nigeria, Depot and Petroleum Products Marketers Association, as well as Jetty and Tank Farm Owners Associations. […]

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Nigeria hit by fresh round of fuel shortages due to payment dispute

* Outstanding subsidy claims still to be approved by Assembly * Fuel marketers being denied credit facilities by banks * Substantial backlog of gasoline offshore WAF Nigeria has been hit by a fresh round of fuel shortages after the country’s main fuel marketers were denied credit facilities by banks, and as a result have had to delay placing orders for clean cargoes of gasoline under the government’s fourth-quarter import program, marketers said Wednesday. Sources said these shortages have risen as the payment of Naira 413 billion ($2.1 billion) to domestic fuel marketers in outstanding subsidy claims for gasoline imports have still not been approved by the central bank. Article continues below… Exchanging value in the oil markets We would like to offer you a free one week subscription to one of the following reports: The government pays a subsidy on gasoline imports, which is the difference between the landing […]

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No luck in drilling for oil and gas in Kenya

Tullow Oil said it found no commercial prospects in frontier basin in northern Kenya despite earlier optimism and results. Photo courtesy of Tullow Oil LONDON, Nov. 17 (UPI) — Despite earlier optimism about the reserve potential in frontier African oil and gas basins, Tullow Oil said it came up empty handed in its efforts in Kenya. Tullow, which has headquarters in London, said it didn’t find any hydrocarbons worth exploring further at a frontier, or wildcat, well in northern Kenya. "While this wildcat well did not find commercial hydrocarbons, it provides valuable data as we assess the wider prospectivity of this basin," Angus McCoss, the company’s exploration director, said in a statement. Tullow is placing bets on emerging basins in Africa, notably offshore developments in Ghana. Like its peers, the company said it’s been a "difficult year" for energy companies working through a period of historically low oil prices. […]

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Liberia’s Oil – Exxonmobil Corp. to Drill Offshore Liberia

Countries such as Nigeria and Ghana have awarded a number of exploration blocks offshore and Liberia has followed suit. ExxonMobil plans to begin drilling late 2015 or early 2017, Steven Buck, its country manager for Liberia and Ivory Coast stated. The US oil firm signed for block 13 in 2013, however placed the project on hold due to the Ebola epidemic. According to President Ellen Johnson Sirleaf, ExxonMobil has shown commitment and strength despite falling prices in the global market. Although the Ebola Crisis affected ExxonMobil, it has re-opened its offices in Liberia so it can resume business. "I am very excited to see ExxonMobil here," said Sirleaf following a meeting with Buck. "Their presence demonstrates to the world that Liberia is once more on the move," added Sirleaf. The United States has lifted economic sanctions on Liberia that it had put in place against former president, Charles Taylor. […]

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Nigeria: Nationwide Fuel Scarcity Looms As Key NNPC Depots Run Dry

In what seems a baptism of fire for President Muhammadu Buhari in his first week as Minister of Petroleum Resources, pockets of queues in filling stations in some major cities across the country appear to have stretched as the fuel scarcity worsened on Friday. In spite of assurances by the Nigerian National Petroleum Corporation, NNPC, industry operators remain sceptical that these were ominous signs the country may be heading for a big mess in the run up to the coming yuletide season. The operators’ scepticism is fuelled by reports that stock of petroleum products at NNPC facilities across the country was grossly insufficient, with supply from local refineries incapable of supporting imports. The Executive Secretary, Depot and Petroleum Products Marketers Association, DAPPMA, Olufemi Adewole, said on Saturday that all its members who own most of the products storage facilities across the country were fast running out of stock of […]

Posted On : Published By : Tom Whipple