Economy
Lagos to Float N100b Bond for Bus Reform Initiative
By Modupe Gbadeyanka
Governor Akinwunmi Ambode of Lagos State has disclosed that his administration would launch a public transportation infrastructure bond of N100 billion that would span between seven to 10 years.
This, he said at the weekend, would drive the implementation of his integrated public transportation system tagged the Bus Reform Initiative that would kick start this year with a sinking fund of N30 billion.
Addressing newsmen, Mr Ambode said his administration had identified the challenges Lagosians go through on a daily basis commuting via public transportation, saying the reform was aimed at providing a viable alternative.
He said the Bus Reform Initiative is a three-year plan aimed at introducing over 5000 air-conditioned buses to replace the yellow commercial buses, popularly called Danfo, which according to him, was no longer befitting for the state’s mega city status.
Hear him: “We decided that the best thing is to allow the yellow buses go and so the Bus Reform Initiative itself is a three-year plan of 2017 to 2019 in which it intends to bring in new buses of 5,000 units in the three-year plan.
“The bigger size buses will take 70 people and then the medium range buses will take 30 people. We believe that the middle range buses will be supplied up to 70 per cent of the total volume which will amount to about 3,600 units and then the longer range in that direction.”
“You are aware that the Federal Government paid the refund of the Paris Club Loan last December and this is a money belonging to the state governments due to the refund and so Lagos State decided not to touch its share of the Paris Club refund.
“Right now, we have a sinking fund of N14.5 billion that is already put in place to drive this public transportation bond.
“We refused to touch our money and we believe that the second batch of the refund should be paid next month and eventually that will be N29 billion that we will have. I will add another N1 billion to it making it N30 billion to kick start this initiative.
“By the time we have N30 billion as sinking fund to drive the bus initiative against the bond of N100 billion that we want to put into the market, there will be that credibility and credence that the bond will drive itself and that is the whole idea,” Governor Ambode added.
He said aside the bond, his administration also intends to give out franchise to interested stakeholders in multiple of 50 buses each, 100 buses, 200 buses and above, explaining that what is required is a down payment of 25 percent of the buses.
“So, these are bankable projects as we have a sinking fund and so our exposure as a government is just technically 75 percent. So, from the kind of machinery we want to use to run the buses, there are no cash takings, everything is automated and obviously, whoever has a franchise, whoever drives, they have the recourse to take part of the money while part of the intake also goes to the repayment of the facility and so it is a comprehensive template,” he said.
However, Mr Ambode pointed out that the state government expects the Danfo drivers, who would be absorbed into the new initiative to adapt accordingly, saying that the transport unions would be expected to take ownership to ensure sustainability.
“This is just a paradigm shift where Danfo drivers move from being addressed as Danfo drivers but as professional drivers. So, we will buy back the Danfos from them and it becomes the seed money to become eventual owners of those buses in the years the facility is spread.
“It is something we have been working on in the last one year and we don’t come out to say we are going to do anything without working properly on it. It is process and now we are at the advocacy process.
“We intend to start to go to the bus parks and all that to educate people and the integral part of these buses is what you see us trying to provide bus terminals, Laybys, bus stops. They are coming in pieces but they will become a complete cup of delivering this particularly product when we put them together,” he explained.
By Adedapo Adesanya
Seplat Energy Plc will revive hundreds of Nigerian oil wells laying fallow after completing the acquisition of Mobil Producing Nigeria Unlimited (MPNU) from ExxonMobil.
The company said it aims to lift oil output to about 200,000 barrels a day, a move that will help boost Nigeria’s oil production levels, as it aims to reach 2 million barrels per day next year.
The transaction, according to Seplat, “is transformative for Seplat Energy, more than doubling production and positioning the company to drive growth and profitability, whilst contributing significantly to Nigeria’s future prosperity.”
The completion of the Seplat-ExxonMobil deal has created Nigeria’s leading independent energy company, with the enlarged company having equity in 11 blocks (onshore and shallow water Nigeria); 48 producing oil and gas fields; 5 gas processing facilities; and 3 export terminals.
Recall that the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) in October approved the deal as part of a series of approvals, while it blocked Shell’s asset sale of up to $2.4 billion to the Renaissance consortium.
The acquisition of the entire issued share capital of MPNU adds the following assets to the Seplat Group: 40 per cent operated interest in OML 67, 68, 70 and 104; 40 per cent operated interest in the Qua Iboe export terminal and the Yoho FSO; 51 per cent operated interest in the Bonny River Terminal (‘BRT’) NGL recovery plant; 9.6 per cent participating interest in the Aneman-Kpono field; and approximately 1,000 staff and 500 contractors will transition to the Seplat Group.
MPNU adds substantial reserves and production to Seplat Energy; 409 million barrels of oil equivalent (MMboe) 2P reserves and 670 MMboe 2P + 2C reserves and resources as at 30 June 2024 and 6M 2024 average daily production of 71.4 kboepd (thousand barrels of oil equivalent).
Business Post reports that Seplat will be part of the payment this year, and will defer some to next year,
Speaking on the transaction, the Chairman of Seplat Energy, Mr Udoma Udo Udoma commended President Bola Tinubu for supporting this transaction and appreciated the support and diligence of the various ministries and regulators for all the work to reach a successful conclusion.
“We are delighted to welcome the MPNU employees to Seplat Energy. We are excited to begin our journey in a new region of the country, and we look forward to replicating the positive impacts we have achieved within our communities in our current areas of operations.
“Seplat’s mission is to deliver value to all our stakeholders, and we treasure the good relationships we have developed with the government, regulators, communities and our staff.”
On his part, the chief executive of Seplat Energy, Mr Roger Brown, described the acquisition as a major milestone, adding, “I extend my thanks to the entire Seplat team for their hard work and perseverance to complete this transaction.
“MPNU’s employees and contractors have a strong reputation for safety and operational excellence, and I welcome them to the Seplat Energy Group.
“We have acquired a company with one of the best portfolios of assets and related infrastructure in a world-class basin, providing enormous potential for the Seplat Group. Our commitment is to invest to increase oil and gas production while reducing costs and emissions, maximising value for all our stakeholders.
“MPNU is a perfect fit with our strategy to build a sustainable business that can deliver affordable, accessible and reliable energy for Nigeria alongside attractive returns to our shareholders”.
By Adedapo Adesanya
The National Pension Commission (PenCom) is projected to close the year with over N22 trillion in pension assets impacted by challenges like inflation and monetary policies.
This is according to PenCom Director-General, Mrs Omolola Oloworaran, at a press conference in Abuja on Thursday.
She said as of October 2024, the Contributory Pension Scheme (CPS) had 10.53 million registered contributors and pension fund assets worth N21.92 trillion.
Speaking at the conference-themed Tech-driven Transformation Shaping the Pension Landscape, which showcased PenCom’s strategic commitment to innovation, she said that the numbers reflected the agency’s unwavering commitment to fund safety, prudent management, and sustainable growth.
She explained that the pension environment was impacted by the wider economic challenges facing the country, noting that the sector battled multi-year high inflation, Naira devaluation, and the lingering effects of unorthodox monetary policies by the Central Bank of Nigeria (CBN).
Business Post reports that the apex bank hiked interest rates by 875 basis points this year alone to tackle persistent inflation which peaked at 33.8 per cent as of October.
She said that these challenges eroded the real value of pension funds and impacted contributors’ purchasing power.
“To address these issues, the commission has initiated a comprehensive review of its investment regulations.
“It is focusing on diversifying pension fund investments into inflation-protected instruments, alternative assets, and foreign currency-denominated investments.
“The goal is to safeguard contributor savings and ensure resilience against future economic volatility,” she said.
She restated the commission’s commitment to expanding pension coverage, particularly through the advanced micro-pension plan designed to encourage participation from the informal sector using technology.
“This initiative will make it easier for everyday Nigerians to save for retirement, aligning with our vision of inclusive growth and financial stability for all.
“The backlog in retirement benefits for retirees of the Federal Government’s Ministries, Departments, and Agencies (MDAs) will soon be settled.
“The federal government recently disbursed N44 billion under the 2024 budget to settle approved pension rights.
“We are collaborating with the Federal Government to institutionalise a sustainable solution to ensure retirees receive their benefits promptly, eliminating delays,” Mrs Oloworaran said.
She said that PenCom’s technology-driven transformation aimed to make the CPS more accessible, reliable, and sustainable.
“From data management to seamless contributions and regulatory supervision, we are paving the way for a future where the pension industry serves all Nigerians effectively,” she said,
Mrs Oloworaran also said that the e-application portal for pension clearance certificates has replaced the manual processes and enhanced the ease of doing business in the sector.
“Since its deployment, 38,528 pension clearance certificates have been issued. This initiative ensures compliance and secures the future of Nigerians working in organisations that interact with the government,” she said.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange closed flat on Thursday, December 12 after it ended the trading session with no single price gainer or loser.
As a result, the market capitalisation remained unchanged at N1.055 trillion as the NASD Unlisted Security Index (NSI) followed the same route, remaining at 3,012.50 points like the previous trading session.
However, the activity chart witnessed changes as the volume of securities traded at the bourse went down by 92.5 per cent to 447,905 units from the 5.9 million units transacted a day earlier.
In the same vein, the value of securities bought and sold by investors declined by 86.6 per cent to N3.02 million from the N22.5 million recorded in the preceding trading day.
But the number of deals carried out during the session remained unchanged at 21 deals, according to data obtained by Business Post.
When trading activities ended for the day, Geo-Fluids Plc remained the most active stock by volume (year-to-date) with 1.7 billion units sold for N3.9 billion, Okitipupa Plc came next with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc was in third place with 297.5 million units worth N5.3 million.
Also, Aradel Holdings Plc remained the most active stock by value (year-to-date) with 108.7 million units worth N89.2 billion, followed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.5 million units sold for N5.3 billion.
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