Economy
NNPC Offers $670m for 10,000tn/d Brass Methanol Plant
By Adedapo Adesanya
The Nigerian National Petroleum Corporation (NNPC) has staked $670 million in equity investment for the construction of 10,000 tonnes/day methanol production plant by the Brass Fertiliser and Petrochemical Company Ltd (BFPCL).
The national oil company alongside the Nigerian Content Development and Monitoring Board (NCDMB) and DSV Engineering signed the Final Investment Decision (FID) on Friday.
The facility would be the largest methanol plant in Africa and the first in Nigeria and the construction phase is expected to create 30,000 direct and indirect jobs and additional 5,000 permanent jobs during the operations phase.
According to the financing plan, the project is estimated to cost about $3.5 billion and asides the equity from NCDMB, NNPC and DSV, there is an impressive cast of lenders which include a consortium of Chinese banks led by the China Exim Bank, African Development Bank (AfDB), international commercial banks, regional banks and African institutions and they would be expected to raise 70 per cent of the project cost.
Other agreements that have been firmed up include a Gas Supply Purchase Agreement (GSPA) with the Shell Petroleum Development Company (SPDC) led joint venture, offtake agreements and contracts for Engineering Procurement and Construction and technology provider.
The Executive Secretary of NCDMB, Mr Simbi Kesiye Wabote; the Group Managing Director (GMD) of the NNPC, Mr Mele Kolo Kyari; and the Executive Vice-Chairman of BFPCL, Mr Ben Okoye signed the FID on behalf of their respective organisations.
Speaking at the event, the Minister of State for Petroleum Resources, Mr Timipre Sylva, said the project was part of the strategic efforts to maximize value and monetize the country’s vast gas endowments.
He stated that President Muhammed Buhari had in July 2020 approved the development of the Brass Gas Company with the sole aim of aggregating and monetising all stranded gas in the Brass area, which amounts to over 10 trillion cubic feet of gas, into the processing facilities to be built in the hub.
He expressed confidence that the project would have a significant economic and developmental impact on the country, including support for gas-based industries, revenue generation and import substitution for methanol needs of the nation that is currently 100 per cent imported.
Other economic benefits include foreign direct investment, economic diversification, acceleration of Nigeria’s march to zero gas flaring and community development through the company’s plan to offer one per cent equity to host communities.
In his remarks, the Executive Secretary NCDMB underscored the significance of two Federal Government’s agencies – NCDMB and NNPC catalysing investments in the country.
He added that the project would place Nigeria in the world’s map as one of the top 10 producers of methanol.
He then emphasised that local content can only grow sustainably when there are oil and gas projects, adding that a mega project of this size provides opportunities to utilize local capacities and capabilities built over the years.
He further explained that opportunities provided by the project in job creation, gas utilization, local availability of methanol for primary and secondary users, formed part of the basis of the board’s decision to partner with Brass Fertiliser and Petrochemicals Company Ltd to enhance the delivery of the project.
Mr Wabote also commended Mr Sylva for recording huge achievements in the energy sector, at a time when most nations are unsure of decisions to make amid the COVID-19 pandemic.
He listed some of the Minister’s accomplishments to include the signing of Train-7 FID, Gas Flares Commercialisation, Marginal Field bid rounds, Petroleum Industry Bill (PIB), Refining Roadmap, and others.
The GMD NNPC, Mr Kyari in his comments described the BFPCL as the most third most important project that had taken FID in the last five years.
He stated that achieving FID for the project was proof of the federal government’s commitment to monetise the nation’s gas resources, notwithstanding the challenging investment environment. He pledged the commitment of NNPC to ensure the delivery of the methanol plant on schedule by 2025.
According to him, “The country is blessed with abundant gas resources, over 200 trillion standard cubic feet of gas (tscf) proven, with a potential of over 600 tscf.
“As energy transition processes go on, you must monetize these gases as quickly as possible. NNPC will continue to collaborate with all the strategic partners. We will ensure that feedstock is available for this project and subsequent projects that would happen in the Brass hub,” he said.
On his part, the Executive Vice-Chairman of BFPCL, Mr Ben Okoye said that jobs that would be created from the project would help to assuage the restiveness in the Niger Delta in addition to the development of a new oil and gas city in Brass Island.
By Dipo Olowookere
Subscription for the July 2026 edition of the FGN savings bond is closing today, Friday, July 10.
The exercise started on Monday, July 6, with two tenures of two years and three years on offer to retail investors.
The retail bonds are sold by the federal government through the Debt Management Office (DMO) to raise funds for the country’s budget deficits.
The savings bond offers investors steady tax-free income. It is risk-free, backed by the Nigerian government, and listed on the Nigerian Exchange (NGX) Limited, allowing for secondary market trading and easy exit before maturity.
For the two-year FGN savings bond maturing on July 15, 2028, the debt office is offering it at a 14.716 per cent per annum interest rate, while the three-year FGN savings bond due July 15, 2029, is at 15.716 per cent per annum, with the interest on the investment being paid by the government every quarter.
Intending investors can purchase the debt instrument at a unit price of N1,000, subject to a minimum subscription of N5,000 and in multiples of N1,000 thereafter, subject to a maximum subscription of N50.0 million.
By Dipo Olowookere
The upward trend on the Nigerian Exchange (NGX) Limited continued on Thursday despite profit-taking in energy stocks by investors.
The local exchange further appreciated by 0.62 per cent yesterday, as market participants mopped up equities in the other key sectors, especially in the financial services.
The banking space rose by 1.33 per cent, the consumer goods counter expanded by 1.21 per cent, and the insurance index grew by 0.26 per cent, while the industrial goods segment closed flat, with the energy sector down by 0.19 per cent.
At the close of business, the All-Share Index (ASI) gained 1,498.75 points to finish at 243,958.73 points compared with the previous day’s 242,459.98 points, and the market capitalisation advanced by N962 billion to N156.548 trillion from N155.586 trillion.
The market breadth index remained positive, though the bears are giving the bulls a close marking. Customs Street ended the session with 28 price gainers and 26 price losers, representing strong investor sentiment.
International Breweries improved by 10.00 per cent to N12.10, First Holdco appreciated by 9.96 per cent to N69.55, Abbey Bank grew by 9.88 per cent to N8.90, Trans-Nationwide Express rose by 9.76 per cent to N3.26, and Honeywell Flour increased by 9.68 per cent to N17.00.
Conversely, Thomas Wyatt declined by 10.00 per cent to N2.70, Geregu Power shrank by 10.00 per cent to N825.70, McNichols moderated by 9.76 per cent to N5.55, UPDC slipped by 9.20 per cent to N3.95, and Neimeth contracted by 8.16 per cent to N9.00.
A total of 1.7 billion stocks valued at N112.0 billion were traded in 44,780 deals yesterday, in contrast to the 518.4 million stocks worth N22.8 billion traded in 48,495 deals on Wednesday, indicating a slip in the number of deals by 7.66 per cent, and a surge in the trading volume and value by 227.93 per cent and 391.23 per cent, respectively.
First Holdco was the busiest equity for the day, with a turnover of 1.3 billion units worth N85.6 billion. Zenith Bank exchanged 43.8 million units for N4.7 billion, Access Holdings transacted 41.0 million units valued at N1.0 billion, FCMB traded 17.7 million units worth N188.3 million, and Fidelity Bank sold 16.0 million units valued at N315.2 million.
By Adedapo Adesanya
Crude oil slid about 2 per cent on Thursday amid worries that rising inflation and other economic concerns could weigh on global oil demand despite fresh Middle East tensions.
Brent futures fell by $1.72 or 2.2 per cent to settle at $76.30 a barrel, while the US West Texas Intermediate (WTI) crude went down by $1.44 or 2.0 per cent to $72.08 per barrel.
Iranian armed forces launched attacks on US military infrastructure in Gulf states on Thursday following America’s strikes on its southern coastal and eastern provinces, further straining a three-week-old ceasefire agreement.
This adds to continued supply constraints as the US-Iran conflict has delayed the full reopening of the Strait of Hormuz, where about 20 per cent of global oil supplies passed through the strait before the war.
On Thursday, only one tanker reportedly moved along the waterway, and it was a sanctioned Very Large Crude Carrier (VLCC) that passed along the Iran-controlled route along with an Iranian container ship.
According to Bloomberg, around 14 commodity-carrying vessels had traversed the Strait of Hormuz on Wednesday. In the past three weeks, following the ceasefire deal, the strait saw an average of 34 tanker crossings per day, peaking at 59 on June 24, data from Kpler showed.
Axios reported that the US Administration believes it has more room for escalation as millions of barrels of oil have managed to exit the Strait of Hormuz in recent weeks, easing concerns about oil price spikes.
Qatar, which has often mediated between the US and its adversaries, including Iran, condemned attacks on commercial shipping and called for a return to diplomacy. The foreign ministers of Turkey and Oman also stressed the need to avoid further military escalation in calls with their Iranian counterpart, Mr Abbas Araqchi.
Minutes of the US Federal Reserve’s June 16 to 17 meeting showed policymakers’ concerns about inflation mounted last month. When the US central bank boosts interest rates to keep inflation in check, it can reduce economic growth and cut oil demand.
In China, the world’s second-biggest economy behind the US, producer price inflation surged in June to its highest level in four years, piling pressure on manufacturers’ profit margins as weak domestic demand limited pricing power.
