Category: West Africa

Nigerian states have drawn from a 300-billion naira ($1.5 billion) emergency fund at the central bank and are asking for more money as they struggle to pay civil service salaries after the oil-price slump. Eighteen states have tapped the intervention fund and more requests are being processed, Central Bank of Nigeria Governor Godwin Emefiele said in a statement e-mailed by the presidency on Thursday. Debts worth a total of 574 billion naira have been restructured for 23 states since August, it said. At least half of Nigeria’s 36 states, which rely on monthly federal handouts for the majority of their funding, have been unable to pay bureaucrats’ wages after Brent crude prices fell by half in the past year. Nigeria is Africa’s largest oil producer.

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* Oil price plunge hits Nigerian revenues, currency * Central bank rations dollars to hold naira peg * Yields on some Nigerian Eurobonds near record * Loans, dividends may be more problematic than bonds By Alexis Akwagyiram and Karin Strohecker LAGOS/LONDON, Sept 16 (Reuters) – Already feeling the pinch from slumping oil prices and slowing economic growth, Nigerian companies are finding it increasingly hard to get hold of foreign currency due to central bank restrictions and may struggle to repay their debts. Yields on a number of dollar corporate bonds have risen close to record highs this week, reflecting investors’ anxiety despite an assertion by Nigeria’s richest businessman that no borrower will default due to the currency shortage. Since 2007, Nigerian financial and energy firms such as FBN Holdings and Seven Energy have issued more than $5 billion of dollar-denominated debt on international capital markets, including almost $3 billion […]

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PREMIUM TIMES has uncovered one of the most fraudulent crude oil deals carried out by the administration of Goodluck Jonathan, which saw cronies of the president pocket billions of naira through a domestic crude oil transportation contract that violated Nigeria’s procurement and economic regulations. Our estimates indicate that the contracts, which the Nigerian National Petroleum Corporation has now admitted were unnecessarily exorbitant and inappropriately awarded, cost Nigeria N509.3 billion. How much service the companies offered to pocket that amount remains unclear even to the state oil company, insiders say. The deal, later disguised as security contract and channeled through the Nigerian National Petroleum Corporation, saw two companies belonging to Idahosa Okunbor and Tunde Ayeni, illegally rack up billions of naira to purportedly transport crude oil from Escravos to Warri refinery, and Bonny Island to Port Harcourt refinery, by ship, since 2011. The deal involved the transportation of five millions […]

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Esso Exploration & Production Nigeria Ltd. , a subsidiary of ExxonMobil Corp., has started oil production ahead of schedule at the Erha North Phase 2 project 60 miles offshore Nigeria ( OGJ Online, June 23, 2015 ). The deepwater subsea development lies in 3,300 ft of water and 4 miles north of Erha field, which has been producing since 2006 ( OGJ Online, May 2, 2006 ). The project includes seven wells from three drill centers tied back to the existing Erha North floating production, storage, and offloading vessel, reducing additional infrastructure requirements. Phase 2 is estimated to develop an additional 165 million bbl from the currently producing Erha North field. Peak production from the expansion is estimated at 65,000 bo/d, increasing total field production to 90,000 b/d. ExxonMobil expects to increase its global production volumes this year by 2% to 4.1 million boe/d, driven by 7% liquids growth. […]

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(file photo). Photo: Premium Times The Nigerian National Petroleum Corporation (NNPC) has finally bowed to the pressure mounted by the International Association of Independent Tanker Owners (INTERTANKO) and lifted a ban on 113 foreign vessels, mostly very large crude carriers (VLCCs) into Nigeria’s territorial waters less than two months after the ban was imposed. Acting on the directive of President Muhammadu Buhari, NNPC imposed the ban shortly after Buhari assumed office over concerns that most of the tankers were complicit in incidents of crude oil theft from Nigerian oil terminals. INTERTANKO, whose members were mostly affected by the ban of the 113 vessels, is one of the largest groups in the shipping industry with 207 full members and 285 associate members, and a registered fleet of over 3,000 tankers of over 270 million DWT (deadweight). In his capacity as the then Group General Manager of NNPC in charge of […]

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An oil pipeline in Nigeria. Growth in the Nigerian economy, Africa’s largest, slowed in the second quarter due to the slump in oil prices, the country’s statistics office said. Gross domestic product expanded 2.35 percent on an annual basis, compared with 3.96 percent a quarter earlier, the head of the National Bureau of Statistics, Yemi Kale, said on his Twitter account on Tuesday. The oil industry contracted 6.8 percent, Kale said. “This is not a good result for Nigeria,” Alan Cameron, a London-based economist at Exotix Partners LLP, said in e-mailed comments. “Moreover, with policy rates stuck at high levels, and fiscal policy being tightened automatically through lower statutory oil disbursements, it is hard to see any catalyst for improvement.” The central bank raised its key interest rate to a record high of 13 percent in November, since when inflation has accelerated beyond the bank’s target band of 6 […]

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Warri and Port Harcourt — Barely two weeks after it resumed operation, the Warri Refining and Petrochemical Company (WRPC) has been shut down. The development is coming on the heels of public excitement that followed news of the nation’s moribund refineries kicking back to life. The Guardian learnt that the refinery was shut down few days ago, as crude oil stored in its receptors ran out. "It goes to show the rot that has been embedded in the system over the years. Now that you have a Buhari government in place, everybody is running helter-skelter to do the needful and in the process they have forgotten to do proper planning. And as they say, when you fail to plan, you plan to fail. "Right now, you have a situation where everybody is in a hurry to do the right thing and they forget that you have to follow a […]

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editorial The lingering decline in crude oil prices, which has greatly affected Nigeria’s revenue from crude oil exports, has taken another dimension in recent months. About 35 million barrels of the country’s crude oil remained unsold at the international market as at December 2014. Sales have been low this year as the fortunes of August and September deliveries remain uncertain, even as oil prices continue to hover on the lower band of $50 a barrel. As it stands, the nation is on a financial cliff and can fall off except a miracle happens. The one commodity that provides life support for the economy has not only seen its price at the international market fall to as low as $48 per barrel, the volume sold is shrinking as well. There is no sign that things will get better soon. The International Energy Agency (IEA) has even predicted that crude oil […]

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Current data on refineries production in Nigeria indicate that more heavy or fuel oils (low and high fuel oil/black oil) are being produced from the four refineries than other high demand products like premium motor spirit, PMS, otherwise known as petrol. The revelation comes despite assurances by the Nigerian National Petroleum Corporation, NNPC, which said last week that two of its refineries were working between 60 and 80 percent of their installed capacities. NNPC had promised that the four refineries would be re-streamed by July end, when the turn around maintenance, TAM, of the hitherto almost comatose refineries would have been rounding up, thus, buoying high hopes for imminent relief from products scarcity in the country. Capacity utilisation However, status of the refineries operations as at July 31, 2015, exclusively obtained by Sweetcrude, indicate that the refineries cannot still meet the daily consumption requirement of between 40 and 42 […]

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