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Economy

Nigeria Attracts $3bn Investment in Fossil Energy

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investment in fossil energy

By Modupe Gbadeyanka

On Tuesday, November 22, 2022, President Muhammadu Buhari said Nigeria attracted a $3 billion investment in fossil energy at a time when the oil and gas sector was becoming less attractive.

He said this was achieved by his administration as a result of the policies put in place to make the industry attractive to investors, especially with the signing of the Petroleum Industry Act (PIA) into law.

“It is, therefore, to the credit of this administration that at a time when there is near zero appetite for investment in fossil energy, coupled with the location challenges, we are able to attract investment of over $3 billion to this project,” Mr Buhari said at the flag-off ceremony of the Kolmani Integrated Development Project in Bauchi today.

The Kolmani Integrated Development Project is a fully integrated in-situ development project comprising upstream production, oil refining, power generation and fertilizer.

“Considering the land locked location and the huge capital requirement, the economics of the project is a challenging proposition.

“Consequently, from the outset, I instructed NNPC Limited to utilize and leverage their vast asset portfolio across all corridors of its operations to de-risk the project to attract the much-needed investment,” he stated.

While commending NNPC and its partners for the successful discovery of crude oil in the Kolmani River Field, the President stated that the huge investment the project had attracted “will surely be a reference subject for discussion in the industry as we pursue the just energy transition programme that will culminate in our country achieving net-zero position by the year 2060.”

Noting the huge benefits the project brings to the country including “but not limited to Energy Security, Financial Security as well as overall socio-economic development of the country,” President Buhari affirmed that his administration’s charge to NNPC to explore other oil and gas fields beyond the Niger Delta Basins has finally yielded commendable results.

“This is indeed significant considering that, efforts to find commercial oil and gas outside the established Niger Delta Basin was attempted for many years without the desired outcomes.

“However, the successful discovery of the Kolmani Oil and Gas field by NNPC and its partners has finally broken the jinx by the confirmation of huge commercial deposits of hydrocarbons in Kolmani River field.

“This discovery had emanated from our charge to the NNPC to re-strategise and expand its oil and gas exploration footprints to the frontier basins of Anambra, Dahomey, Sokoto, Benue trough, Chad and Bida Basins. Similar activities across the other basins are currently actively on-going.

“We are pleased with the current discovery of over one billion barrels of oil reserves and 500 billion cubic feet of gas within the Kolmani area and the huge potential for more deposits as we intensify exploration efforts.”

Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

Economy

Stock Market Down by 0.13% as Investors Offload MTN, Cadbury

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Stock Market Newspaper

By Dipo Olowookere

The winning streaks witnessed on the floor of the Nigerian Exchange (NGX) Limited lately was halted on Thursday as profit-taking in some blue-chip equities pulled down the stock market by 0.13 per cent.

Heavyweights like MTN Nigeria, GTCO, Cadbury Nigeria and FBN Holdings came under selling pressure yesterday, bringing down the exchange at the close of transactions despite the strong investor sentiment.

Business Post reports that the market breadth closed positive on Thursday as the bourse recorded 15 appreciating stocks and 10 depreciating equities led by Capital Hotel, which dropped 9.80 per cent to sell at N2.76. Honeywell Flour declined by 9.09 per cent to N2.20, Coronation Insurance decreased by 8.11 per cent to 34 Kobo, ABC Transport crashed by 7.41 per cent to 25 Kobo, and Cadbury Nigeria depleted by 4.46 per cent to N10.70.

However, the shares of Chams grew by 9.09 per cent during the session to 24 Kobo, RT Briscoe expanded by 7.69 per cent to 28 Kobo, PZ Cussons inflated by 5.50 per cent to N11.50, Livestock Feeds improved by 4.50 per cent to N1.16, and Ecobank increased by 2.86 per cent to N10.80.

Analysis of the sectorial performance showed that the energy index remained unchanged, the industrial goods and the banking counters closed higher by 1.11 per cent and 0.46 per cent apiece, while the insurance and the consumer goods sectors declined by 0.48 per cent and 0.06 per cent, respectively.

As a result, the All-Share Index (ASI) of the NGX slacked by 61.35 points to 48,365.14 points from 48,426.49 points, while the market capitalisation went down by N34 billion to N26.343 trillion from N26.377 trillion.

Yesterday, investors transacted 148.2 million shares worth N3.0 billion in 3,391 deals compared with the 146.2 million shares worth N3.4 billion traded in the midweek session in 2,810 deals, indicating a decline in the trading value by 11.77 per cent, an increase in the trading volume by 1.37 per cent, and a surge in the number of trades by 20.61 per cent.

The most attractive stock for the session was Ecobank, as it sold 23.4 million units and was trailed by FBN Holdings, which traded 25.8 million units. Transcorp exchanged 12.9 million units, Access Holdings transacted 9.6 million units, and Sterling Bank traded 9.2 million units.

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Economy

House of Reps Tells CBN to Suspend New Cash Withdrawal Limits

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House of Reps Tells CBN to Suspend New Cash Withdrawal Limits

By Modupe Gbadeyanka

The Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele, has been told to immediately suspend the new limits placed on the withdrawal of cash from over-the-counter (OTC), Automated Teller Machines (ATMs) and Point of Sales (POS).

On Tuesday, the central bank said from January 9, 2023, any cash withdrawal above N100,000 for individuals would attract a 5 per cent processing fee and a 10 per cent processing fee for withdrawals of more than N500,000 for corporate organisations.

This policy is already generating mixed reactions, with POS operators saying it would push them into the unemployment market because of the loss of jobs and the Nigeria Employers’ Consultative Association (NECA) saying stakeholders were not “extensively consulted” by the CBN before its announcement.

At the plenary on Thursday, a lawmaker, Mr Aliyu Magaji, who moved a motion of urgent public importance, warned that the new policy could spell doom for the economy as several people would lose their jobs, while traders, artisans and rural dwellers would suffer because of the cash limits.

His colleagues agreed with him and criticised the apex bank for the policy.

Though the Minority Leader, Mr Ndudi Elumelu, pointed out that the new cash withdrawal limits would check crimes as funds would now be tracked through the banking system, he emphasised that the timing was wrong.

The other legislators echoed this opinion and added that it would have serious consequences and adverse effects on businesses and Nigerians who have no access to the banking system.

As a result, they asked Mr Emefiele to roll back the policy, summoning him to appear before them on Thursday, December 15, 2022, to explain the policy and why it should not be rejected.

Incidentally, the day he is to appear next week is the same day the CBN plans to officially introduce the newly redesigned N200, N500, and N1,000 banknotes into circulation.

The Naira was redesigned by the apex bank to control the volume of cash in the financial system after it was discovered that more than 80 per cent of cash in circulation was not in the banks’ vaults.

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Economy

New Cash Withdrawal Policy Was Without Extensive Consultation—NECA

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Nigeria Employers’ Consultative Association NECA

By Modupe Gbadeyanka

The Nigeria Employers’ Consultative Association (NECA) has accused the Central Bank of Nigeria (CBN) of not consulting with stakeholders extensively before coming up with the new cash withdrawal policy expected to take effect from January 9, 2023.

In the new directive, the CBN said the maximum cash that can be withdrawn from banks is N100,000 per week for individuals and N500,000 for corporate organisations. Also, customers would not be able to withdraw more than N100,000 from the Point of Sale (PoS) machines and Automated Teller Machines (ATMs) and N20,000 per day. It further said the highest Naira note to be loaded in ATMs is N200.

However, withdrawals above the cash limits via over-the-counter, according to the directive of the apex bank, would attract 5 per cent for individuals and 10 per cent for companies.

Commenting on the new development, the Director-General of NECA, Mr Wale-Smatt Oyerinde, emphasised that the livelihood of many individuals and enterprise sustainability would be impacted.

“As usual with the CBN, the bank announced a new naira withdrawal policy without extensive consultation with organized businesses and those that will be directly impacted by the policy.

“This new policy is diversionary and a mere distraction from the critical issues that are affecting the nation,” Mr Oyerinde stated.

Speaking further, he said, “While it is desirable to get all bankable individuals and businesses into the banking system and promote the cashless policy of the CBN, the timing without adequate preparation and sensitization of the critical mass that drives the economy (the SMEs and MSMEs) could prove counter-productive and further drive many below the poverty line.

“This is another classical example of the inconsistencies and misalignments between the fiscal and monetary policies of the government.

“It is absurd to blatantly set traps of processing fees for individuals and businesses who desire to withdraw their hard-earned money from the bank for legitimate and genuine business transactions.

“It is also important to note that the banking infrastructure and mobile/digital facility to drive the cashless policy are not sufficiently developed. This is not only draconian but also inhuman.

“We urge the CBN and, indeed, the federal government to replicate the energy and promptness used in implementing this policy to address the issues of dwindling value of the Naira, rising inflation, oil theft, ballooning foreign debt, and get millions out of poverty realm.”

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