Economy
Nigeria Loses N184.5bn to Gas Flaring in Six Months
By Adedapo Adesanya
The possibility of Nigeria boosting its earnings by N183.54 billion at a time it is witnessing a decline in revenue was lost as oil and gas companies operating in the country wasted 126 billion standard cubic feet (SCF) of gas in the first half of 2022.
According to a report obtained from the National Oil Spill Detection and Response Agency (NOSDRA), the gas was burnt off in the course of the oil production process in six months.
The agency lamented that gas has been flared in Nigeria since the 1950s, releasing carbon dioxide and other gases into the atmosphere, serving as a continuing source of environmental and health concerns in the Niger Delta, despite efforts to reduce it.
The oil spill watchdog noted that the volume of gas flared in the six-month period was equivalent to carbon dioxide (CO2) emission of 6.7 million tonnes in the oil-producing areas, capable of generating 12,600 gigawatts hours of electricity; while the companies were expected to pay penalties of $252.1 million, about N104.87 billion, which are hardly paid.
In comparison, NOSDRA reported that the gas flared in the month under review was 4.56 per cent higher than the 120.5 billion SCF of gas flared in the second half of 2021, valued at $421.8 million, about N175.47 billion.
The gas flared between July and December 2021 also attracted penalties of N241 million, an equivalent of N100.26 billion; has a power generating potential of 12,100 gigawatts hour; and saw an equivalent of 6.4 million tonnes of CO2.
Furthermore, NOSDRA added that the volume of gas flared in the first half, according to the agency, represented a decline of 9.87 per cent, compared with the 139.8 billion SCF of gas flared in the same period in 2021, valued at $489.4 million, about N203.59 billion.
The quantity of gas flared in the first six months of 2021, was capable of generating 14,000 gigawatt-hour of electricity; was equivalent to 7.4 million tonnes of CO2; while the companies were liable for penalties of $279.7 million, about N116.36 billion.
Giving a breakdown of the gas flared in the country in the first six months of 2022, NOSDRA disclosed that companies operating in Nigeria’s offshore oilfields flared 62.2 billion SCF of gas, valued at $217.6 million; equivalent to 3.3 million tonnes of CO2 emissions; capable of generating 6,200 gigawatts hour of electricity, with penalties payable at $124.3 million.
On the other hand, the oil spill agency reported that companies operating onshore flared 63.9 billion SCF of gas, valued at $223.6 million, with penalties payable at $127.8 million; equivalent to 3.4 million tonnes of CO2 emissions, and has power generation capable of 6,400 gigawatts hours.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited shed 0.66 per cent on Thursday, driven primarily by sell-offs in financial stocks.
During the session, the insurance counter depreciated by 2.26 per cent, the banking space dropped 2.04 per cent, the consumer goods index tumbled by 1.18 per cent, and the industrial goods sector gave up 0.70 per cent. They offset the 0.01 per cent leap recorded by the energy segment at the close of business.
Consequently, the All-Share Index (ASI) moderated by 1,617.91 points to 245,362.26 points from the previous day’s 246,980.17 points, and the market capitalisation retreated by N1.005 trillion to N158.340 trillion from Wednesday’s N159.345 trillion.
The worst-performing equity was Tripple Gee, which crashed by 10.00 per cent to N2.88. Lasaco Assurance declined by 9.92 per cent to N2.18, C&I Leasing slumped by 9.84 per cent to N5.50, Mutual Benefits depreciated by 9.80 per cent to N3.22, and Trans-Nationwide Express decreased by 9.03 per cent to N2.82.
The best-performing equity was Legend Internet, which chalked up 8.64 per cent to close at N4.40. DAAR Communications advanced by 7.32 per cent to N1.76, Sterling Holdings grew by 6.67 per cent to N8.00, Sovereign Trust Insurance expanded by 5.73 per cent to N2.03, and Royal Exchange soared by 4.69 per cent to N1.34.
Trading activity yesterday improved when compared with midweek’s, with the volume of trades up by 176.72 per cent to 2.1 billion shares from the 758.9 million shares recorded a day earlier. The value of transactions increased by 582.84 per cent to N230.8 billion from N33.8 billion, and the number of deals shrank by 12.71 per cent to 48,231 deals from the 55,251 deals executed on Wednesday.
First Holdco was the busiest stock for the day, with a turnover of 1.6 billion units valued at N196.2 billion, Access Holdings sold 37.4 million units for N998.5 million, Sterling Holdings exchanged 36.0 million units worth N286.8 million, Ellah Lakes transacted 34.8 million units for N297.8 million, and Zenith Bank traded 33.1 million units valued at N4.0 billion.
By Adedapo Adesanya
The oil market settled lower by 1 per cent on Thursday as traders digested proposed plans for a Saudi Arabia-led maritime coalition to boost defence cooperation around the Red Sea.
Brent futures slipped by $1.71 or 1.88 per cent to $89.03 a barrel, while the US West Texas Intermediate (WTI) crude futures declined by 87 cents or 1.03 per cent to trade at $83.59 per barrel.
Saudi Arabia seeks to lead a coalition to boost defence cooperation in the Bab El-Mandeb Strait, the Red Sea and the Gulf of Aden.
The Saudi defence ministry said 14 states, including Turkey, Pakistan, Egypt, Sudan and Djibouti, have issued a joint statement in support of the proposed multinational maritime defence coalition.
This comes after Iran-aligned Houthi militants in Yemen declared a naval blockade last week on Saudi Arabia, threatening the Red Sea route for its oil exports, an alternative to the largely blockaded Strait of Hormuz. The strait, which normally handles around a fifth of global oil and liquefied natural gas flows, has remained a focal point for oil markets since the US and Israel launched the war on Iran on February 28.
Houthis had attacked Saudi Arabia this week from Iraqi territory in coordination with Iraqi armed groups, reflecting growing coordination among Iran-aligned militias, two officials in the region said. The attacks included strikes on oil facilities in Saudi Arabia’s eastern province, the kingdom’s main crude hub.
Iran and Oman also continued talks on the management of the Strait of Hormuz, after Iran previously ruled out Oman’s proposal for regional joint management of the waterway.
It also denied that it is negotiating with US officials and gave no sign that it was ready to make new concessions over its effective closure of the strait.
Meanwhile, the US military said it had hit dozens of Islamic Revolutionary Guard Corps (IRGC) targets in Iran in an operation launched after it fired ballistic missiles at U.S. forces in the Middle East.
Fresh supply worries also emerged after tankers loading at the Caspian Pipeline Consortium (CPC) terminal headed away from the Black Sea after a vessel was hit during loading at the terminal on Thursday.
A Ukrainian drone attack caused a fire at Lukoil’s Perm refinery that damaged and forced the shutdown of one of its crude distillation units.
By Modupe Gbadeyanka
The federal government has been urged to give all the necessary support to indigenous investors, as they remain Nigeria’s most important drivers of employment, foreign exchange generation and long-term economic resilience.
This advice was given by foremost businessman, Mr Aliko Dangote, when he welcomed the Minister of State for Industry, Mr John Owan Enoh, to the Dangote Petroleum Refinery and Petrochemicals in Lagos recently.
The business mogul noted that efforts must be made to place industrialisation at the centre of the government’s economic strategy, insisting that no nation has attained prosperity without a strong manufacturing base.
“If Nigeria is to achieve sustainable growth and become a trillion-dollar economy, industrialisation must be the foundation. Indigenous investors remain the strongest catalysts for that transformation,” Mr Dangote stated.
He further stated that, “There is no way to create jobs and prosperity without industrialisation,” declaring that, “The greatest attraction for foreign investors is the success of domestic investors. When local investors thrive, they send a powerful signal that the environment is conducive for investment.”
In his remarks, the Minister promised deeper collaboration with the private sector to accelerate industrialisation, job creation and economic transformation.
He also pledged that the Ministry and its agencies would remain strong advocates of the refinery and the broader industrialisation agenda, adding that the government would continue to engage Dangote Industries Limited through the Industrial Revolution Work Group and ministerial roundtables to address challenges facing manufacturers, particularly access to affordable long-term financing.
Mr Enoh described the integrated industrial complex as one of the most significant investments in Africa and a model for the type of industrial development required to drive Nigeria’s economic growth aspirations.
“This facility matters because of what it represents for Nigerian industry, for our people and for the realisation of President Bola Tinubu’s vision of a one trillion-dollar economy,” he stated, noting that the refinery has emerged as a powerful symbol of value addition, industrial competitiveness and Nigeria’s growing manufacturing capability.
The Minister noted that the refinery has fundamentally changed global perceptions of Nigeria by helping to transform the country from a major importer of refined petroleum products into an exporter serving international markets.
“When global supply disruptions occurred, Nigeria was able to export petroleum products to markets in the Middle East and beyond. That is an extraordinary achievement and one that deserves recognition,” he added.
