By Adedapo Adesanya
The Nigerian National Petroleum Corporation (NNPC) has disclosed fuel subsidy will likely not go away this year despite the signing into law the Petroleum Industry Act (PIA) by President Muhammadu Buhari some days ago.
It was initially thought that the PIA will automatically wipe out fuel subsidy from the petroleum sector but the Group Managing Director (GMD) of the NNPC, Mr Mele Kyari, said it may remain next year and possibly till 2023 when the new law should have been fully implemented.
A few days ago, President Buhari, who is expected to constitutionally vacate office on May 29, 2023, constituted a steering committee for the implementation of the PIA headed by the Minister of State for Petroleum Resources, Mr Timipre Sylva. The team was given one year to carry out its assignment.
The Minister had said it would be very difficult to immediately remove petrol subsidy with the new law without putting in place a gradual plan for this, with stakeholders like the labour unions carried along.
Mr Kyari, while speaking on Wednesday at the Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) 2022 to 2024 public hearing by the House of Representatives Committee on Finance, stated that the country may not exit the fuel subsidy regime in 2022, but stressed that this might be done by 2023 when the Act might have been fully activated.
He also informed the lawmakers at the hearing chaired by Mr James Faleke that his agency was working to track fuel consumption by deploying technology to monitor fuel distribution across Nigeria in a bid to check the activities of smugglers.
He stated that with the electronic monitoring, every truck carrying fuel would be visible as they discharged their load and would see all the fuel stations as they discharged.
Mr Kyari said that the national fuel consumption per day may not be above 60 million litres as being speculated, adding however that anytime NNPC supply less than that, there would be a problem.
He also said that President Buhari had personally directed him to take steps that would curtail cross border smuggling, while also admitting the challenges posed by land borders, aiding activities of smugglers.
The GMD said that those who took crude oil across the border would not sell at the official price.
He said that the corporation was already engaging the Republic of Niger to establish a retail NNPC outlet in the country’s neighbour, a move that would curtail the activities of smugglers.
Speaking on the Dangote refinery, Mr Kyari said that the decision of the NNPC to be on the board of the refinery was a calculated attempt, adding that as of today, Nigeria does not have strategic storage.
“We are taking interest in Dangote Refinery and up till now, he does not want us to take 50 per cent equity and it was structured on the fact that he must buy 300,000 barrels of crude oil from us per day,” he stated.
He said that Dangote Refinery had a choice to buy crude oil from anywhere in the works but was charged to buy from the country, stressing that it was a good deal the NNPC was proud to enter into.
Mr Kyari said that contrary to insinuation, the NNPC has not abandoned the country’s refineries and it was not about taking a $500 million loan to repair them as speculated.
He added that none of the country’s refineries had undergone full-scale rehabilitation since 2000.
Turkish Pipeline Fire Drives Crude Oil Prices Higher
By Adedapo Adesanya
For the fourth trading session, crude oil prices soared at the global market on Wednesday on the back of a fire that briefly stopped the flow of a pipeline from Iraq to Turkey.
This increased concerns about an already tight supply outlook amid worrisome geopolitical troubles in Russia and the United Arab Emirates, holding prices in the bullish territory.
Consequently, the price of the Brent crude futures rose by 93 cents or 1.06 per cent to trade at $88.44 per barrel, while the West Texas Intermediate (WTI) crude futures jumped $1.53 or 1.8 per cent to $86.96 per barrel.
It was gathered that to address the pipeline issue yesterday, Turkey had to cut oil flows on the Kirkuk-Ceyhan pipeline after an explosion on the system, although the cause of the explosion was not announced.
The pipeline carries crude out of Iraq, the second-largest producer in the Organization of the Petroleum Exporting Countries (OPEC), to the Turkish port of Ceyhan for export.
In recent days, supply concerns have after Yemen’s Houthi group attacked the United Arab Emirates (UAE), OPEC’s third-largest producer, while Russia, the world’s second-largest oil producer, has built up a large troop presence near Ukraine’s border, stoking fears of invasion.
The tensions raise the prospect of supply disruptions at a time when OPEC and their allies, together called OPEC+, are already having difficulty meeting their agreed target to add 400,000 barrels per day of supply each month.
On the back of these, analysts expect prices to remain high as jet fuel consumption is rising with growth in international flights, while road traffic is much higher than the same time last year.
Outages in Libya, Ecuador, and Kazakhstan, coupled with downgrades to US, Russia, and Brazil forecasts, together result in 1 million barrels per day, indicating lower supply this month against the previous forecast.
The International Energy Agency (IEA) on Wednesday raised its demand growth estimates by 200,000 barrels per day for both 2021 and 2022.
Demand increased by 1.1 million barrels per day to 99 million barrels per day in the fourth quarter of 2021, defying expectations of a serious hit to consumption due to the Omicron wave, the IEA said in its Oil Market Report (OMR).
The market is tighter than expected, the agency said, but still warned that there would be a surplus in the first quarter of 2022, with “demand set for a seasonal decline, exacerbated by more teleworking and less air travel.”
US President Joe Biden explained that his administration will work to try to increase oil supplies in the world’s largest oil producer.
The administration had authorized the release of 50 million barrels of crude oil – in a mix of loans and sales – from the nation’s Strategic Petroleum Reserve last year, but it had minimal effect on the market.
Senate Pass Bill to Establish National Rice Development Council
By Adedapo Adesanya
The Senate has passed a bill seeking to establish the National Rice Development Council as part of the federal government’s effort to cut down on rice importation and improve the country’s foreign exchange earnings.
The passage of the bill followed the consideration of a report by the Committee on Agriculture and Rural Development.
Speaking at the presentation, the Chairman of the Committee, Mr Abdullahi Adamu, said the council will support the comprehensive development of the rice sector and the organisation of rice stakeholders to enhance local production of rice in Nigeria.
He explained that the organisation will transform the activities of rice farmers, rice processors, millers, researchers, marketers and other important stakeholders across the entire rice value chain, particularly the clusters of smallholder rice farmers and small scale millers spread all over the country.
“Mr President and distinguished colleagues, with our natural comparative advantage in the area of rice production as a country, Nigeria should consider the need to put in place a National Rice Development Council and a fail-safe comprehensive national rice development roadmap that will guide us not only into a regime of self-sufficiency in production but also for export purposes, employment generation for our teaming youth and growth of our economy.
“The Nigerian rice industry exists in the abstract as there appears to be no form of coordination in the absence of a properly structured rallying point.
“Today, we have Paddy Rice Dealers Association of Nigeria (PRIDAN), Rice Farmers Association of Nigeria (RIFAN), Rice Processors Association of Nigeria (RIPAN), Rice Millers Association of Nigeria (RIMAN) and many more.
“This Bill seeks to establish that rallying point and a comprehensive national operational and governance structure for a complete rice value chain process.
“Mr President and distinguished colleagues, this Bill on its own merit will improve government efforts for efficient policy and regulatory framework for the Nigerian rice industry; promote enabling business and investment environments for rice stakeholders; support the growth of the rice industry in Nigeria and in the sub-region as well as promote the sustainability of foreign exchange earnings put at about $2 billion annually for Rice related importation to the country.
“The framework created by thịs Bill will pull investment into rice production, provide the missing link between rice production and industrialization, provide employment, reduce migration from rural to urban cities and enhance socio-economic activities all over the country.
“Few countries having Rice Council include Rice Council of Tanzania, USA Rice Council, Directorate of Rice Development (India), Rice Association of Thailand, among others,” he said.
SEC Praises Market Development Initiatives of NGX, CSCS, Others
By Aduragbemi Omiyale
The Nigerian Exchange (NGX) Limited, the Central Securities Clearing System and other capital market stakeholders have been praised by the Securities and Exchange Commission (SEC) for their market development initiatives, helping the capital market scale through the COVID-19 crisis.
According to the Director-General of SEC, Mr Lamido Yuguda, NGX plays a very significant role in the Nigerian capital market, and as such, the commission remains supportive of the exchange in the key role it plays towards developing the market.
While speaking at a meeting with capital market stakeholders in Abuja on Wednesday, the SEC chief further said the agency was aware that the advancement of new-generation information technologies, the rapid innovation of financial instruments and the impact of the COVID-19 pandemic are gradually transforming the operations of capital markets through the introduction of sound initiatives in the financial industry eco-system.
“The past two years have been challenging for the Nigerian capital market, which is largely a reflection of the Pandemic-related unexpected challenges in global markets. However, the NGX has continued to deploy capable resources to tackle elements militating against the market’s growth.
“You will agree with me that the efforts made and gains achieved in this regard are as a result of the collective efforts of various stakeholders in the Nigerian capital market, including the commission and the NGX Ltd. This emphasises the importance of collaboration on the growth of our market,” he said.
Mr Yuguda said specifically, the launching of the Smart Surveillance System and X-Mobile App for retail trading; upgrading of the X-Issuer Platform to further enhance market integrity; and the X-Public Offer initiatives are highly commendable achievements that support our common goal of building a world-class capital market.
While applauding their efforts, the SEC boss, however, reminded them of the challenging task ahead and new threats brought forth by Fintech and what is expected from stakeholders to consolidate on the achieved gains while making necessary adjustments to improve market practices and remain vigilant against potential risks.
“We all have a common interest in developing a healthy, viable and world-class capital market. At the bottom of the work we do at the SEC, is investor protection. While trying to look at the rules we should not forget that the ultimate goal of the commission is to have a fair and transparent market that is fair to investors,” Mr Yuguda said.
He reiterated that as the apex regulator of the capital market with a mandate to develop the market, SEC will continue to support all efforts aimed at making the markets fairer, more efficient and more transparent.
In his opening remarks, Chief Executive Officer of NGX Limited, Mr Temi Popoola, said there have been strong growth and market interactions in recent times which he attributed to the collaborative efforts of stakeholders.
Mr Popoola emphasised the need for education in the technology sector in the country, adding that as a market it is time to put all hands on deck to tap the potential in that sector.
“A lot of opportunities exist for the capital market. Technology can be used to address the capital formations in the market and we are making progress in tapping that.
“We are on a digitalisation drive and we have started with the MTN offer which was done electronically, we need to improve on that going forward. That is the only way to unlock the demography of young Nigerians that are technology savvy.
“We are collaborating with relevant stakeholders to ensure what’s best for the ecosystem. We are exploring ways to strengthen the entire market infrastructure,” he stated.
Also speaking, the Managing Director/CEO of CSCS, Mr Haruna Jalo-Waziri, welcomed the collaboration between markets, regulators and tiger stakeholders saying that the aim is to simplify the marker and give investors the experience they deserve to ensure they keep coming back.
“The market is changing, and with technology, a lot of the ways we were operating is also changing and we look forward to better market and operations,” he added.
Like Our Facebook Page
Latest News on Business Post
- Turkish Pipeline Fire Drives Crude Oil Prices Higher January 20, 2022
- Senate Pass Bill to Establish National Rice Development Council January 19, 2022
- SEC Praises Market Development Initiatives of NGX, CSCS, Others January 19, 2022
- Nigeria Lost 2.418 million Barrels of Crude in December 2021—OPEC January 19, 2022
- Important Factors to Consider while Building a Business Intelligence Programme for Your Organisation January 19, 2022
- Information Operations: An Understudied Facet of Russian Influence in Africa January 19, 2022
- Oyo SUBEB Moves to Curb Fire Outbreaks in Schools January 19, 2022
- Chinmark Allays Fears of Investors, Says No Cause for Panic January 19, 2022
- NSCDC Denies Operating Illegal Oil Bunkering Site January 19, 2022
- Senate Re-amends Electoral Bill, Okays Direct, Indirect, Consensus Primaries January 19, 2022
Feature/OPED2 years ago
Davos was Different this year
Economy5 years ago
Kwara Disburses N1.7b For Projects
Travel/Tourism5 years ago
Lagos Seals Western Lodge Hotel In Ikorodu
Technology1 year ago
How To Link Your MTN, Airtel, Glo, 9mobile Lines to NIN
Economy5 years ago
How To Identify Fake Naira Notes
Banking4 years ago
Sort Codes of GTBank Branches in Nigeria
Economy4 years ago
NSE Market Capitalisation Sheds N76b as Sell‐offs Persist
Economy4 years ago
FAAC: FG, States, LGs Share N655.18b in January