Economy
Oando to Double Production to 50,000bpd With Eni Deal
By Adedapo Adesanya
Oando has projected to double its production to 50,000 barrels per day of oil equivalent with the closure of its landmark deal with Eni, which it says is imminent.
This was disclosed by the oil and gas firm’s Chief Operating Officer, Mr Alex Irune, to S&P Global Commodity Insights at the weekend, noting that the firm intends to scale up to 100,000 barrels per day by 2029, thanks to new drilling and security improvements.
The Nigerian company’s bid to buy the Italian major’s entire Nigerian upstream business reflects a major shift in Africa’s biggest oil producer, with local firms replacing departing International Oil Companies (IOCs).
Business Post had reported that the deal had come under scrutiny, including from local workers.
However, Mr Irune disagreed that approvals had been an issue.
“What we are seeing is a careful, considered approach to ensuring that the country isn’t materially impacted in a negative way, ensuring the indigenous players are able to straddle the horse and ride it into the horizon,” he said.
Through the deal, Oando will become one of Nigeria’s biggest domestic producers which is currently “working through the obligations under the Share Purchase Agreement” and is “on track” to close the deal this quarter, Mr Irune said.
The estimated $500 million acquisition covers four oil-producing blocks OMLs 60, 61, 62 and 63, which comprise a joint venture alongside the Brass terminal, onshore exploration concessions and power plants.
Eni currently holds a 20 per cent operating stake in the JV alongside Oando with 20 per cent and state-owned Nigerian National Petroleum Company Limited (NNPC) with 60 per cent.
Oando, which is run by Mr Adewale Tinubu is currently producing 25,000 barrels per day and following the deal, its JV stake will rise to 40 per cent.
Production rises over the next five years will be achieved through drilling programmes on marginal fields, particularly Qua Iboe (OML 13) and Ebendo (OML 56).
“We’ll be drilling four to five wells on these two fields over the next 18 months. Both fields have easy access to export terminals, including the Escravos pipeline system in the case of OML 56,” he emphasised.
The Eni agreement was first signed in September. It follows home-grown Seplat’s battle to take over ExxonMobil’s onshore business.
Meanwhile, Shell has agreed to sell its onshore assets to a consortium of mostly local companies and Equinor has signed a deal to divest its assets to Mauritius-based Chappal Energies.
The trend indicates an IOC exodus from mature African basins and a shift towards frontiers like Namibia and Guyana, less carbon-intensive projects and less risky offshore developments.
This raises questions about Nigeria’s ability to boost the sector that has been plagued by underinvestment, inadequate exploration and the scourge of crude theft in the Niger Delta.
To this effect, Mr Irune insists that local firms were well-equipped to rejuvenate the sector.
“The government is certainly in support of this transition and keen to see indigenous players step into those roles and deliver,” he said. “If you look at the local companies that have stepped forward…there’s no doubt that the indigenous capacity exists,” he added.
Asked about the apparent delays in approvals, Mr Irune added: “Acquisitions of this nature are relatively novel and for the first time the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has set a framework for divestment where there are certain criteria that you must get through to qualify, and that process takes its course.”
At the same time, local ownership could actually reduce theft, which was costing Nigeria 400,000 barrels per day in August 2023, according to the government’s security adviser, by giving communities a bigger stake in the success of the industry.
“My personal opinion is having indigenous players will definitely improve issues around fairness and this need to engage in sabotage and theft,” he said.
He said with this smaller companies can build a more cohesive and collaborative oil sector.
“We’re not going to be ‘siloed’ global companies with headquarters in Houston. Nigeria is our headquarters,” he pointed out.
By Adedapo Adesanya
The United Arab Emirates has announced its decision to quit the Organisation of the Petroleum Exporting Countries (OPEC) to focus on national interests.
This dealt a heavy blow to the oil-exporting group at a time when the US-Israel war on Iran had caused a historic energy shock and rattled the global economy.
The move, which will take effect on May 1, 2026, reflects “the UAE’s long-term strategic and economic vision and evolving energy profile”, a statement carried by state media said on Tuesday.
“During our time in the organisation, we made significant contributions and even greater sacrifices for the benefit of all,” it added. “However, the time has come to focus our efforts on what our national interest dictates.”
The loss of the UAE, a longstanding OPEC member, could create disarray and weaken the oil cartel, which has usually sought to show a united front despite internal disagreements over a range of issues from geopolitics to production quotas.
UAE Energy Minister Suhail Mohamed al-Mazrouei said the decision was taken after a careful look at the regional power’s energy strategies.
“This is a policy decision. It has been done after a careful look at current and future policies related to the level of production,” the minister said.
OPEC’s Gulf producers have already been struggling to ship exports through the Strait of Hormuz, a narrow chokepoint between Iran and Oman through which a fifth of the world’s crude oil and liquefied natural gas supplies normally pass, because of threats and attacks against vessels during the war.
The UAE had been a member of OPEC first through its emirate of Abu Dhabi in 1967 and later when it became its own country in 1971.
The oil cartel, based in Vienna, has seen some of its market power wane as the US has increased its production of crude oil in recent years.
Additionally, the UAE and Saudi Arabia have increasingly competed over economic issues and regional politics, particularly in the Red Sea area.
The two countries had joined a coalition to fight against Yemen’s Iran-backed Houthis in 2015. However, that coalition broke down into recriminations in late December when Saudi Arabia bombed what it described as a weapons shipment bound for Yemeni separatists backed by the UAE.
By Adedapo Adesanya
Central Securities Clearing System (CSCS) Plc bested four price decliners on the NASD Over-the-Counter (OTC) Securities Exchange on Monday, April 27. The alternative stock market opened the week bullish during the session with a 0.03 per cent uptick.
According to data, the security depository company added N2.61 to its share price to close at N76.26 per unit compared with the preceding session’s N78.87 per unit.
As a result, the market capitalisation of the platform increased by N820 million to N2.425 trillion from N2.424 trillion, and the NASD Unlisted Security Index (NSI) gained 1.38 points to finish at 4,053.97 points compared with the 4,052.58 points it ended last Friday.
The four price losers were led by NASD Plc, which slumped by N3.80 to sell at N34.70 per share versus N38.50 per share. FrieslandCampina Wamco Nigeria Plc fell by N1.45 to N98.10 per unit from N99.55 per unit, Food Concepts Plc slid by 27 Kobo to N2.43 per share from N2.70 per share, and Geo-Fluids Plc dipped by 9 Kobo to N2.91 per unit from N3.00 per unit.
The value of securities transacted by market participants went down by 82.0 per cent to N7.4 million from N41.3 million units, the volume of securities declined by 28.5 per cent to 319,831 units from 447,403 units, and the number of deals dropped by 34.1 per cent to 29 deals from 44 deals.
Great Nigeria Insurance (GNI) Plc was the most active stock by value on a year-to-date basis with 3.4 billion units worth N8.4 billion, followed by CSCS Plc with 59.6 million units sold for N4.0 billion, and Okitipupa Plc with 27.8 million units exchanged for N1.9 billion.
Also, GNI Plc was the most traded stock by volume on a year-to-date basis with 3.4 billion units valued at N8.4 billion, followed by Resourcery Plc with 1.1 billion units traded for N415.7 million, and Infrastructure Guarantee Credit Plc with a turnover of 400 million units worth N1.2 billion.
By Adedapo Adesanya
The first trading day of the week in the currency market was bearish for the Naira in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Monday, April 27.
Yesterday, it lost N5.80 or 0.43 per cent against the United States Dollar to trade at N1,364.24/$1, in contrast to the N1,358.44/$1 it was traded last Friday.
In the same vein, the Nigerian currency depreciated against the Pound Sterling in the official market by N13.70 to close at N1,847.72/£1 versus the preceding session’s N1,834.02/£1, and slumped against the Euro by N11.56 to sell at N1,602.29/€1 versus N1,590.73/€1.
Also, the Nigerian Naira tumbled against the greenback during the trading day by N5 to quote at N1,385/$1 compared with the previous rate of N1,380/$1, and at the GTBank FX desk, it traded flat at N1,370/$1.
The poor performance of the domestic currency could be attributed to liquidity shortage at the official currency market on Monday, which came amid surging demand for international payments. At $76.50 million, interbank liquidity printed higher across 79 deals, up from the $43.572 million reported on Friday.
Nigeria’s gross external reserves declined to $48.45 billion amid a month-long decline in inflows, amid uncertainties in the global commodity market. The depletion of foreign reserves could be partly attributed to the Central Bank of Nigeria’s intervention in the FX market.
The market remains perturbed by persistent concerns over liquidity constraints, policy transparency, and weakening confidence in Nigeria’s FX market, while boosters, including oil prices, continue to look rocky due to stalled discussions and unclear ceasefire negotiations between the US and Iran.
A look at the cryptocurrency market, Bitcoin (BTC) has been rejected near $79,000 three times in eight sessions, leaving the level as the de facto ceiling of its current trading range even as major cryptocurrencies trade lower over the past day. It lost 0.9 per cent to sell at $77,003.61.
Analysts say that upcoming US Federal Reserve policy decisions and top tech firms’ earnings this week could provide the catalyst to push bitcoin decisively above $80,000.
The market also continued to weigh Iran’s interim deal proposal to reopen the Strait of Hormuz, which failed to advance over the weekend. The White House said US officials were discussing the latest Iranian proposal but maintained “red lines” on any deal to end the eight-week war.
Solana (SOL) dropped 1.8 per cent to $84.25, Ripple (XRP) went down by 1.6 per cent to $1.39, Ethereum (ETH) depreciated by 1.3 per cent to $2,290.00, Binance Coin (BNB) declined by 0.5 per cent to $625.18, and Cardano (ADA) fell by 0.2 per cent to $0.2480.
However, Dogecoin (DOGE) rose by 2.0 per cent to $0.1002, and TRON (TRX) appreciated by 0.2 per cent to $0.3242, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
-
Feature/OPED6 years agoDavos was Different this year
-
Travel/Tourism10 years ago
Lagos Seals Western Lodge Hotel In Ikorodu
-
Showbiz3 years agoEstranged Lover Releases Videos of Empress Njamah Bathing
-
Banking8 years agoSort Codes of GTBank Branches in Nigeria
-
Economy3 years agoSubsidy Removal: CNG at N130 Per Litre Cheaper Than Petrol—IPMAN
-
Banking3 years agoSort Codes of UBA Branches in Nigeria
-
Banking3 years agoFirst Bank Announces Planned Downtime
-
Sports3 years agoHighest Paid Nigerian Footballer – How Much Do Nigerian Footballers Earn