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Nigerian Content Intervention Fund Exceeds $500m



Nigerian Content Intervention Fund

By Adedapo Adesanya

The Nigerian Content Development and Monitoring Board (NCDMB) has said the Nigerian Content Intervention Fund has exceeded half a billion dollars.

This was disclosed by the Executive Secretary of NCDMB, Mr Simbi Wabote, while speaking at the Sub-Saharan African International Petroleum Conference (SAIPEC) organised in Lagos by the Petroleum Technology Association of Nigeria (PETAN).

He indicated that the NCI Fund which is extended as low-cost credit to qualified oil and gas companies covers asset acquisition, project financing, manufacturing, working capital, loan refinancing, women in oil and gas, and research and development.

The NCI Fund is a component of the Nigerian Content Development Fund, NCDF which is accumulated through one per cent deductions from contracts awarded in the upstream sector of the oil and gas industry.

Mr Wabote added that the Board is using the NCDF to catalyse the construction of modular refineries, gas processing plants, LPG terminals and bottling plants, LPG Cylinders manufacturing plants, lube oil blending plants, base oil production plant, methanol production plant, and many others.

He canvassed that a similar fund replicated at the continental level and be utilised to develop huge mega oil and gas projects, particularly as world financial institutions were getting reluctant to finance hydrocarbon-related projects.

He said: “let me use this opportunity to once again canvass for the creation of an African Local Content Fund that could be utilised to set up a bank or finance institution to provide funding for the development of oil and gas projects in Africa.

“This is especially important against the backdrop of the reluctance and outright declaration by some banks and financial institutions to stop funding of hydrocarbon-related projects. I hope the Afrexim Bank, AfDB, or the AU through the AfCFTA Secretariat need to institute a form of contribution, no matter how little, as a fund to support the continent’s need for funds.”

He explained that “in our own case, the deduction of one per cent of every contract awarded to any contractor, subcontractor, alliance partner or any other entity involved in any project, operation, activity, or transaction in the upstream sector of the Nigeria oil and gas industry has resulted in us having a pool of funds to support various intervention programmes.”

Speaking further, the Executive Secretary described the recent spike in crude oil prices above $90 a barrel as an excellent opportunity for African oil producers and its service providers to develop new fields, ensure the security of supply and affordability as well as increase revenue generation.

He noted that the price of crude oil has increased by 50 per cent in 12 months and African oil producers should use the opportunity to also make plans towards energy transition and lowering the cost of services.

Mr Wabote stated that an enabling regulatory framework backed with the appropriate legislation is very fundamental in Local Content practice and commended African oil producers for putting in place investor-friendly laws to promote the oil and gas industry as well as ongoing collaboration among the countries to advance the local content journey.

He noted that such laws will align with the goals of the Africa Continental Free Trade Agreement, AFCFTA which seeks to create the world’s largest free trade area by integrating 1.3 billion people across 54 African countries, with the objective of tapping into a combined Gross Domestic Product, GDP of over $3 trillion.

He described AFCFTA as the practice of Local Content on the continental level, noting that it is a huge trading and collaboration platform for the participating countries.

The NCDMB boss harped on the need for African oil producers to utilise existing cross-border infrastructures to unlock the development of stranded assets or bring energy closer to the people. He mentioned that the existing West Africa Gas Pipeline, WAGP and ongoing AKK gas transmission infrastructure provide a good opportunity to serve regional markets.

He also pointed out that the SHI-MCI yard in Lagos which is the only FPSO integration yard infrastructure in Africa has put Nigeria at a vantage position to serve the wider African market.

In his remarks, the Chairman, PETAN, Mr Nicholas Odinuwe advocated for regional collaboration and innovation to enhance the future of the energy sector.

He disclosed that the key enabler for the continent is to create a collaborative ecosystem between the local industry stakeholders alongside the African Continental Free Trade Area, AfCFTA.

Mr Odinuwe encouraged governments across Africa to provide necessary incentives to attract private sector investments across the entire value chain which would trigger a massive economic revolution, human capital development, and deepen local content across the continent.

Adedapo Adesanya is a journalist, polymath, and connoisseur of everything art. When he is not writing, he has his nose buried in one of the many books or articles he has bookmarked or simply listening to good music with a bottle of beer or wine. He supports the greatest club in the world, Manchester United F.C.

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Financial Industry Players Must Collaborate to Satisfy Customers Needs



financial industry players

By Aduragbemi Omiyale

The Managing Director of Interswitch Purepay, Mr Akeem Lawal, has called on critical players in the Nigerian financial service industry to put heads together to provide innovative solutions and unique offerings to customers.

According to him, customers deserve the best from financial industry players like banks, telecommunications companies and financial technology (fintech) firms in order to meet the 95 per cent financial inclusion target by 2024.

Mr Lawal, who delivered a presentation at the recently-concluded Nigerian Fintech Forum at the Civic Centre, Lagos, stated that the partnership will accelerate growth and deepen financial inclusion in the country.

He said despite the growth of the financial sector, customers are yearning for more innovative and seamless payment solutions, which must be designed to meet their needs strengthen the financial industry.

The tech expert said at the event themed Building Partnership for Growth, Exploring the Intersection of Banks, Telcos and Fintech Companies that the Nigeria financial industry has evolved tremendously over the years with customers transitioning from banking halls transactions to adopting digital payment services.

“As headline platinum sponsor, we are delighted to be sponsoring the Nigeria Fintech Forum because we believe that a platform like this will provide the opportunity for critical stakeholders in the financial industry to engage and proffer solutions that will consequently drive the growth of the financial Industry.

“At Interswitch, we will continue to design tailor-made solutions that speak to the need of every customer. Therefore, it is important for players in the financial industry, including the banks, telcos and fintechs to leverage collaboration to provide innovative and seamless solutions to customers. This is the only way we can meet the 95% financial inclusion target by 2024,” Mr Lawal stated.

Speaking during the panel session tagged Regulating Nigeria’s Fintech Industry, Building Investors Confidence Without Stifling Growth, another speaker, Mr Tyoyila Aga, who is Group Head, Financial Services Business at Interswitch, said it was important that players in the industry collaborate with regulators, keep abreast of new regulations and help strengthen compliance levels to grow the financial industry.

“At Interswitch, our approach to regulators is to work in harmonious ways with them and that is what we have been doing for two decades. This has helped us to understand regulations better and we urge other players to do same to grow the industry,” Mr Aga said.

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Airtel Africa Gets $125m Credit Facility from Citibank



airtel africa

By Adedapo Adesanya

Top telecommunications company, Airtel Africa Plc, has announced the signing of a $125 million revolving credit facility with Citibank’s subsidiaries in Sub-Saharan Africa.

This was contained in a disclosure sent to the Nigerian Exchange (NGX) Limited.

It was stated that the credit facility will provide Airtel Africa with the opportunity to save interest rates in exchange for achieving social impact milestones in such areas as digital inclusion and gender diversity.

The social impact projects will focus mainly on rural areas and women and are aligned with Airtel Africa’s recently launched sustainability strategy.

Airtel Africa’s newly secured $125 million credit facility is part of the telco’s corporate strategy to raise debt in its local operating companies. To this effect, the facility will come in both local currencies and US dollars. It will also have a 1-year tenor.

“This facility is in line with our strategy to raise debt in our local operating companies and will include both local currency and US dollar-denominated debt. The facility has a tenor up to September 2024 and will be used to support Airtel Africa’s operations and investments in four of its subsidiaries,” the statement said.

This is a big boost to the telco which operates in 14 African markets and has ongoing projects across several of these markets, including the recent acquisition of an additional 60 MHz spectrum for $40 million in Kenya and the Democratic Republic of Congo (DRC).

Airtel Africa’s business offerings range from telecommunications to mobile money services. It has a combined user base of about 131.6 million.

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DisCos Reduce Number of Estimated Billing Customers by 16.3%



estimated billing customers

By Adedapo Adesanya

The National Bureau of Statistics (NBS) has said that the number of Electricity Distribution Companies (DisCos) customers in Nigeria increased by 1.4 per cent from 10.37 million in 2020 to 10.51 million in 2021.

The report, Nigeria Electricity Report 2021, focuses on energy billed, revenue generated, and customers by DISCOS under the reviewed period.

The report said the number of metered customers rose by 36.2 per cent from 3.51 million in 2020 to 4.77 million in 2021, causing the number of estimated billing customers to decrease by 16.3 per cent from 6.86 million in 2020 to 5.74 million in 2021.

It was disclosed that in total, the value of electricity billed in 2021 grew by 5.9 per cent from 22,042.28 Gigawatts (Gwh) in 2020 to 23,360.59 (Gwh) in 2021, while the total revenue collected by the discos stood at N761.17 billion, 44.5 per cent higher than the N526.77 billion achieved in 2020.

A breakdown showed that the Abuja Electricity Distribution Company (AEDC) recorded the highest number of metered customers in 2021 at 701,781, while Yola Electricity Distribution Company (YEDC) recorded the least with 65,098.

In terms of electricity supplied, Ikeja Electricity Distribution Company (IKEDC) recorded the highest in 2021 with 4,088.62 Gwh, while YEDC recorded the lowest at 422.00 Gwh.

Similarly, the highest revenue collected was by IKEDC with 155,012.01 million while the least collection was recorded in YEDC with 9,804.00m million.

More than 83 million Nigerians do not have access to grid electricity. This represents 43 per cent of the country’s population and makes Nigeria the country with the largest energy access deficit in the world.

The lack of reliable power is a significant constraint for citizens and businesses, resulting on annual economic losses estimated at N10.1 trillion, which is equivalent to about 2 per cent of GDP.

According to the now-discontinued World Bank Doing Business report for 2020, Nigeria ranked 171 out of 190 countries in getting electricity and electricity access is seen as one of the major constraints for the private sector.

To assist in mitigating this, the World Bank approved $500 million to support the government of Nigeria in improving its electricity distribution sector last year.

According to the global lender, the project will help boost electricity access by improving the performance of the DisCos through a large-scale metering programme.

In addition, the World Bank said financial support would be provided to private distribution companies only on achievement of results in terms of access connections, improved financial management and network expansion.

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