By Aduragbemi Omiyale

The management of Dangote Refinery has picked a hole in the claims by the Nigerian National Petroleum Company (NNPC) Limited that it supported the business with a $1 billion loan when it was undergoing a liquidity crisis.

In a statement on Wednesday night, the private oil refinery believed to be worth about $20 billion said the claims by the NNPC were not true.

In the disclosure made available to Business Post, the Group Chief Branding and Communications Officer of Dangote, Mr Anthony Chiejina, said, “We would like to clarify that this is a misrepresentation of the situation as $1bn is just about 5 per cent of the investment that went into building the Dangote Refinery.”

“Our decision to enter into a partnership with NNPCL was based on recognition of their strategic position in the industry as the largest off-taker of Nigerian crude and at the time, the sole supplier of gasoline into Nigeria.

“We agreed on the sale of a 20 per cent stake at a value of $2.76 billion. Of this, we agreed that they will only pay $1 billion while the balance will be recovered over a period of 5 years through deductions on crude oil that they supply to us and from dividends due to them. If we were struggling with liquidity challenges we wouldn’t have given them such generous payment terms.

“As of 2021 when the agreement was signed, the refinery was at the pre-commission stage. In addition, if we were struggling with liquidity issues, this agreement would have been cash-based rather than credit-driven.

“Unfortunately, NNPCL was later unable to supply the agreed 300 thousand barrels a day of crude given that they had committed a greater part of their crude cargoes to financiers with the expectation of higher production which they were unable to achieve.

“We subsequently gave them a 12-month period for them to pay cash for the balance of their equity given their inability to supply the agreed crude oil volume. NNPCL failed to meet this deadline which expired on June 30th 2024. As a result, their equity share was revised down to 7.24 per cent. These events have been widely reported by both parties.

“It is, therefore, inaccurate to claim that NNPCL facilitated a $1 billion investment amid liquidity challenges. Like all business partners, NNPCL invested, $1 billion in the Refinery to acquire an ownership stake of 7.24 per cent stake that is beneficial to its interests,” he explained.

Mr Chiejina noted that, “NNPCL remains our valued partner in progress, and it is imperative for all stakeholders to adhere to the facts and present the narrative in the correct context, to guide the media in reporting accurately for the benefit of our stakeholders and the public.”

By Adedapo Adesanya

President Bola Tinubu has said his administration would not reverse his reformist policies as he presented the 2025 budget pegged at N47.90 trillion at the joint National Assembly on Wednesday.

According to the President, top priority will be given to security and defence, infrastructure, health, and education.

He noted that some of these sectors received high allocations in the 2025 Appropriation Bill themed The Restoration Budget: Security Peace, Building Prosperity.

The President listed some of the highlights of the budget as defence and security – N4.91 trillion, infrastructure – N4.06 trillion, health – N2.4 trillion, education – N3.5 trillion, among others.

“The 2025 budget seeks to restore macro-economic stability enhance the business environment, foster inclusive growth, employment and poverty reduction, and promote equitable income distribution and human capital development,” Tinubu said

“In 2025, we are targeting N34.8 trillion in revenue to fund the budget. government expenditure in the same year is projected to be N47.90 trillion including N15.81 trillion for debt servicing.

“A total of N13.0tn or 3.89 per cent of GDP will make up the budget deficit. This is an ambitious but necessary budget to secure our future.

“The budget projects inflation will decline from the current rate of 34.6 per cent to 15 per cent next year (2025) while the exchange rate will improve from approximately N1,700 per Dollar to N1,500 per Dollar,” he stated.

Mr Tinubu pegged crude oil production at 2.06 million barrels per day for 2025 and also projected that the importation of finished petroleum products would reduce in 2025 while the exportation of refined petroleum products would increase.

He expressed commitment to economic renewal, thanking all Nigerians for embarking on the journey of reform and transformation in the last 18 months together.

The President said the economy is responding to stimulus and that his government would continue to take the right steps for economic progress.

“The reforms yielding results, no reversals,” he said.

He also pleaded that food security is non-negotiable, adding that the government is taking steps to ensure Nigerians feed and not go to bed hungry.

“Our 2025 is not just another statement of projected government revenue and expenditure; it calls for action.

“Our nation faces an existential threat from corruption and insecurity…These challenges are surmountable when we work collaboratively. We must rewrite the narrative of this nation.

“The time for lamentation is over. The time to act is now,” he stressed.

By Adedapo Adesanya

The Senate has passed the 2014 Nigerian Insurance Industry Reform Bill, following the adoption of the report by the Committee on Banking, Insurance, and Other Financial Institutions.

The report was presented by the committee’s chairman, Mr Adetokunbo Abiru during the plenary session on Tuesday.

The bill is awaiting assent by President Bola Tinubu to become codified and executed as a law.

Mr Abiru explained that the bill, which was read a second time on July 18, sought to consolidate various existing laws regulating insurance businesses in Nigeria.

He listed the relevant laws to include the Insurance Act 2003, the Marine Insurance Act, the Motor Vehicles Third Party Insurance Act, the National Insurance Corporation Act, and the Nigerian Reinsurance Corporation Act.

A major objective of the bill, according to the lawmaker, is to create a robust legal and regulatory framework for the insurance sector, enabling it to contribute positively to Nigeria’s financial landscape.

He emphasised the need for effective risk-based supervision in the insurance sector, arguing that the current rule-based regulatory system had become obsolete.

The former chief executive of Polaris Bank noted that stakeholders, during the public hearing, widely supported the bill, highlighting that existing laws no longer meet the evolving needs of the industry.

“The current insurance legislation is over two decades old and lacks provisions to address contemporary challenges and foster growth and innovation,” he said.

He also pointed out that legal obsolescence had led to regulatory inefficiencies, hampering the industry’s global competitiveness.

Mr Abiru urged the Senate to pass the bill, which would provide a comprehensive framework for the regulation of all types of insurance initiatives in Nigeria.

His colleague, Mr Jimoh Ibrahim raised concerns about the proposed minimum capital requirement of N45 billion for reinsurance businesses, suggesting the status quo should be maintained due to the current economic situation.

He highlighted that the passage of the bill was necessary to align the insurance ecosystem with contemporary economic realities, which would ultimately benefit the country.

“This Act, once it receives concurrence from the House of Representatives and assent from the President, will significantly contribute to shaping our economy for the better.

“Economies are dynamic and constantly changing, so it is incumbent upon the authorities of every nation to update their legislation to align with contemporary realities.

“This is precisely what the passage of this legislation aims to achieve to restructure the entire insurance ecosystem in line with current realities.

“I am confident that the country will benefit greatly when the law is eventually assented to.”