Economy
NNPC, Kogi Target 84m Litres of Bio-fuel, Two Million Jobs
By Modupe Gbadeyanka
A Memorandum of Understanding (MoU) for the development of fuel-ethanol processing plant that would produce 84 million litres of bio-fuel per year has been sealed by the Nigerian National Petroleum Corporation (NNPC) and the Kogi State government.
Speaking during the signing of the MoU on Tuesday in Abuja, Group Managing Director of the NNPC, Mr Maikanti Baru, said the project would yield a cane mill and a raw and refined Sugar Plant of 126,000 tonnes annually.
He stated that the Bagasse co-generation Plant would also generate 64 Megawatts of power, stressing that the plant would include a carbon dioxide recovery and bottling plant with capacity of 2,000 tonnes per year.
“The Sugarcane Feedstock Plantation would be on a 19,000 hectares and it would produce animal feeds of 63,000 tonnes per year,” the NNPC chief said
Mr Baru said NNPC was pleased to know of another opportunity in the Alape Staple Crop Processing Zone (SCPZ), in Kogi State which is a vast Agro Allied business opportunity that provides suitable agronomics for the cultivation of Sugarcane, Cassava and Oil Palm.
He stated that discussions had been held with the various parties and stakeholders on the Kogi Biofuels Project on the modality for the implementation, adding that Agreements had been reached on the first stage of the project, starting with the signing of an MoU.
Mr Baru said the signing of the MoU would lead to the formation of a Special Purpose Vehicle (SPV) to steer the future activities of the proposed project, stressing that the project is central to the attainment of economic development on the basis of value-added investment portfolios, environmental sustainability, climate change mitigation, wealth and job creation to reduce the poverty index, while balancing the ecosystem, and maintenance of national and global security.
GMD said the execution of the MoU was a milestone in the government’s determination to diversify the economy and at the same time compliment Nigeria’s effort in meeting with the growing energy demand.
He said, “NNPC is committed to implementing Nigeria’s Nationally Determined Contribution (NDC) under the Paris Agreement aimed at combating global Climate Change, to which President Muhammadu Buhari signed, and deposited Nigeria’s ‘Instrument of Ratification’ to the United Nations Framework Convention on Climate Change (UNFCCC) in May 2017.”
The NNPC helmsman stated that the Renewable Energy Division of NNPC was created in line with Federal Government’s directive with the sole aim of Industrialising Agriculture in Nigeria through the commercial production of biofuels from selected energy crops as feedstock, while fostering the exploitation of other Renewable Energy Sources.
He added that the project would mitigate against the negative effect of climate change and earn Nigeria Carbon credits from Clean Development Mechanism Projects activities, serving as additional line of profitable business for NNPC, including food production and power generation.
Mr Baru noted that the project would lead to increased diversification of NNPC’s business portfolio and serve as a credible source of additional income for the corporation.
The GMD envisaged that the proposed NNPC Biofuels project in Kaba/Bunu, Kogi State would be an integrated feedstock plantation and process plants complex on a land mass of 20,000 hectares for sugarcane and or 15,000 hectares for cassava with potentials for further expansion.
He explained that NNPC had carried out seven bankable feasibility studies which include three (3) integrated sugarcane fuel ethanol projects in Benue, Kebbi and Gombe States, two integrated cassava fuel ethanol projects in Ondo and Anambra States and two integrated oil palm biodiesel projects in Rivers and Cross River States.
In his remarks, Kogi State Governor, Mr Yahaya Bello, said the MoU was another milestone in the history of the state, stressing that the project would take not fewer than two million citizens of the state out of the street.
He applauded President Muhammadu Buhari and the GMD, Mr Baru, for their doggedness to diversify the Nigerian economy, adding that the state was ready to provide all the needed support for the take-off of the project.
Highpoint of the ceremony was the signing of the agreement between the Governor and the GMD of NNPC.
By Adedapo Adesanya
Nigeria’s total public debt stock increased by 17 per cent to N46.25 trillion or $103.11 billion as of December 2022 from N39.56 trillion or $95.77 billion in 2021.
This information was revealed by the Debt Management Office (DMO) on Thursday.
This means that the country’s debt profile precisely increased by 16.9 per cent or N6.69 trillion or $7.34 billion within one year, as the government borrow funds from various quarters for its budget deficits.
The agency said the new figures comprise the domestic and external total debt stocks of the federal government and the sub-national governments (36 state governments and the Federal Capital Territory).
The DMO statement partly read, “As of December 31, 2022, the total public debt stock was N46.25 trillion or $103.11 billion.
“In terms of composition, total domestic debt stock was N27.55 trillion ($61.42 billion) while total external debt stock was N18.70 trillion ($41.69 billion).
“Amongst the reasons for the increase in the total public debt stock were new borrowings by the FGN and sub-national governments, primarily to fund budget deficits and execute projects. The issuance of promissory notes by the FGN to settle some liabilities also contributed to the growth in the debt stock.
“On-going efforts by the government to increase revenues from oil and non-oil sources through initiatives such as the Finance Acts and the Strategic Revenue Mobilization initiative are expected to support debt sustainability.”
“The total public debt to gross domestic product (GDP) ratio for December 31, 2022, was 23.20 per cent and indicates a slight increase from the figure for December 31, 2022, at 22.47 per cent.
“The ratio of 23.20 per cent is within the 40 per cent limit self-imposed by Nigeria, the 55 per cent limit recommended by the World Bank/International Monetary Fund, and the 70 per cent limit recommended by the Economic Community of West African States,” the debt office said.
By Dipo Olowookere
The 364-day treasury bills stop rate was raised by the Central Bank of Nigeria (CBN) at the primary market auction (PMA) on Wednesday by 5.25 per cent as appetite for the asset class waned.
The central bank, which conducted the exercise, did not record the usual hunger for the debt instrument by investors yesterday, ostensibly because of how the bank had tinkered with the rates in the previous exercises.
But the apex bank surprised subscribers at the PMA on Wednesday when it jerked the rate higher to 14.74 per cent from the 9.49 per cent it cleared in the previous PMA.
According to details of the exercise, the CBN auctioned the one-year bill worth N139.96 billion and received subscriptions valued at N165.28 billion, allotting N142.16 billion.
Business Post reports that it was not only the 12-month dated instrument that enjoyed the rate hike yesterday as the two others benefitted.
The central auctioned N3.34 billion worth of the 182-day bill during the session but had investors stake N1.56 billion on it, with N1.56 billion allotted to successful bidders at 8.00 per cent compared with the previous session’s 5.00 per cent, indicating an increase of 3.00 per cent.
As for the 91-day bill, the rate cleared at 6.00 per cent after it was moved higher by 3.45 per cent from 2.55 per cent. This was after the apex bank allotted N1.75 billion to subscribers, the same amount of bids it received from the N2.16 billion taken to the market on Wednesday.
Recall that some days ago, the Monetary Policy Committee (MPC) of Nigeria’s central bank increased the Monetary Policy Rate (MPR), which is the benchmark interest rate in the country, by 0.50 per cent to 18.00 per cent.
The team explained that the rate hike was mainly to tame rising inflation in Nigeria, which the National Bureau of Statistics (NBS) said stood at 21.91 per cent in February.
By Adedapo Adesanya
The Vice President of Nigeria, Mr Yemi Osinbajo, has lauded China’s investment in Africa, saying it has reduced dependency on loans from Bretton Woods, which consists of the World Bank and the International Monetary Fund (IMF).
In a statement seen by Business Post, the VP, at an event at King’s College London on March 27, 2023, stated that “China shows up where and when the West will not and or are reluctant.”
He said this was evident in the investment of the Asian giant in Africa, which he said stood at $254 billion in 2021, about four times the volume of US-Africa trade.
He also noted that, “China is the largest provider of foreign direct investment, supporting hundreds of thousands of African jobs. This is roughly double the level of U.S. foreign direct investment, adding that, “China remains by far the largest lender to African countries.”
He also noted that Chinese companies had taken the lead in exploiting minerals in Africa, many now in lithium mining in Mali, Ghana, Nigeria DRC, Zimbabwe and Namibia.
The Nigerian second-in-command said that China has always shown up for African countries while outrightly condemning Western countries in that regard.
He said, “Most African countries are rightly unapologetic about their close ties with China. China shows up where and when the west will not or are reluctant.”
He added, “And many African countries are of the view that the beware of the Chinese Trojan loans advise forming the west is wise but probably self-serving,” explaining that, “Africa needs the loans and the infrastructure. And China offers them. In any case, the history of loans from Western institutions is not great.”
Taking a step further, Mr Osinbajo sent a salvo to the World Bank and the IMF over the conditions attached to their loan facilities.
“The memory of the destructive conditionalities of the Bretton Woods loans is still fresh, and the debris is everywhere.
“And the preoccupation of western governments and media with the so-called China debt trap might well be an overreaction,” he added.
“I recommend an eye-opening lecture by Professor Deborah Brautigam about two weeks ago at Jesus College Cambridge.
“The truth, as she points out, is that all of the Chinese lendings to Africa is only 5 per cent of all outstanding public and publicly guaranteed debt in low and middle-income countries, compared to 23% held by the World Bank and other multilaterals.”
He alluded that Chinese lenders account for 12 per cent of Africa’s private and public external debt.
“And the Chinese have also been there when the debts cannot be paid. In early 2020 as COVID battered African economies, China came together with other G20 members to launch the Debt Service Suspension Initiative (DSSI).
“About 73 low-income economies benefited from the suspension of principal and interest payments. Chinese banks provided 63 per cent of the total debt relief while being only owed 30 per cent of the debt service payments due,” he quipped.
