Economy
OPEC Challenges Nigeria to Push for Energy Diversification
By Adedapo Adesanya
The Organisation of Petroleum Exporting Countries (OPEC) has revealed that the global energy sector requires about $12.6 trillion investment for development by 2045, charging Nigeria to re-strategise.
This was disclosed by the Secretary-General of the cartel, Mr Mohammad Barkindo, while presenting a keynote address at the 14th Annual Conference of the Nigerian Association of Energy Economics (NAEE) in Abuja, saying that oil would continue to remain relevant to the global economic growth and development.
At the event themed Strategic Responses of the Energy Sector to COVID-19: Impact on African Economies, Mr Barkindo said that oil would continue to remain relevant to global economic growth and development.
“It is vital for us to remember that oil will remain the largest contributor to the energy mix to 2045 with more than 27 per cent, according to the latest OPEC World Oil Outlook.
“Renewables are developing most rapidly, but at the same time, the world’s economy is set to double and all resources will be required to meet this growing need.
“Cumulative investment of $12.6 trillion in the upstream, midstream and downstream is crucial through to 2045 in order to meet this need,” he said.
According to him, investment in 2020 dropped by more than a whopping 30 per cent in the face of COVID-19, even worse than the dramatic declines seen in the severe 2015-2016 industry downturn.
He said that the energy security risk that would result from too little investment would heavily impact both producers and consumers.
He noted that oil-producing developing countries, like Nigeria, would be particularly hard hit.
“History has shown that energy insecurity brings with it economic insecurity and geopolitical instability.
“All OPEC Members, including Nigeria, will have to re-strategise to maintain their positions in the new global energy mix, including focusing on economic diversification.
“Oil-producing countries, and in particular African countries that rely on oil and gas production for revenues, must create an investment-friendly climate — to this end,” he said.
He noted that the Petroleum Industry Bill (PIB) promises to be a huge success in reviving the fortunes of the oil and gas industries in Nigeria.
He said that reduced foreign direct investment into Africa’s industry could be catastrophic for many countries and peoples.
He said that OPEC was concerned about increasing pressure on the oil industry coming from many sides, including decision-makers, along with investors.
“Even within the boardrooms of oil majors, the push is strong to strive for policies and initiatives that could have a drastic negative effect on oil-producing countries.
“Oil is the lifeblood of our country, thus the importance of this issue cannot be underestimated,” he said.
On Energy Transition, Mr Barkindo said oil had a powerful role to play in the energy transition, and it should not be swept under the rug based on old credentials.
He noted that with the help of technology, the industry can become low carbon or even zero-carbon.
“This includes technologies already being implemented such as carbon capture, utilization and storage.
“Additionally, great strides have been made in efficiency gains in the industry, along the entire production chain.
“It is essential that one compare the lifetime credentials of each source of energy in terms of emissions.
“For example, electric cars may appear cleaner, but emissions are buried in many of the industrial processes required to produce them.
“We applaud Nigeria’s goals to reduce carbon emissions while pursuing the UN SDGs, which seek to achieve access to affordable, reliable, sustainable and modern energy for all.
“Transitioning to a low-carbon energy future may seem to run counter to the socio-economic benefits of energy, in particular to energy-poor countries.
“Nigeria is attempting to tackle this challenge head-on with the strong promotion of solar and wind energy, and expansion in the use of natural gas,” he said.
On the impact of COVID-19, the OPEC Secretary-General said that the global oil sector was a worse hit but on the road to recovery.
“We have all suffered the impact of the COVID-19 pandemic over 2020 and 2021. It constitutes an unprecedented event for the global oil industry and the world economy.
“No country or citizen of this planet has remained unscathed and the pandemic continues to overshadow 2021 as it did 2020.
“However, oil-producing developing countries have been particularly hard hit.
“They are facing a triple whammy; COVID-19 has crippled the economies of poorer countries more than wealthier ones,” he said.
He urged the NAEE to use the conference and proffer solutions to some major challenges facing the sector nationally and globally.
By Modupe Gbadeyanka
The federal government, the 36 states of the federation and the 774 local government areas have received N1.727 trillion from the Federal Accounts Allocation Committee (FAAC) for December 2024.
The funds were disbursed to the three tiers of government from the revenue generated by the nation in November 2024.
At the December meeting of FAAC held in Abuja, it was stated that the amount distributed comprised distributable statutory revenue of N455.354 billion, distributable Value Added Tax (VAT) revenue of N585.700 billion, Electronic Money Transfer Levy (EMTL) revenue of N15.046 billion and Exchange Difference revenue of N671.392 billion.
According to a statement signed on Friday by the Director of Press and Public Relations for FAAC, Mr Bawa Mokwa, the money generated last month was about N3.143 trillion, with N103.307 billion used for cost of collection and N1.312 trillion for transfers, interventions and refunds.
It was disclosed that gross statutory revenue of N1.827 trillion was received compared with the N1.336 trillion recorded a month earlier.
The statement said gross revenue of N628.972 billion was available from VAT versus N668.291 billion in the preceding month.
The organisation stated that last month, oil and gas royalty and CET levies recorded significant increases, while excise duty, VAT, import duty, Petroleum Profit Tax (PPT), Companies Income Tax (CIT) and EMTL decreased considerably.
As for the sharing, FAAC disclosed that from the N1.727 trillion, the central government got N581.856 billion, the states received N549.792 billion, the councils took N402.553 billion, while the benefiting states got N193.291 billion as 13 per cent derivation revenue.
From the N585.700 billion VAT earnings, the national government got N87.855 billion, the states received N292.850 billion and the local councils were given N204.995 billion.
Also, from the N455.354 billion distributable statutory revenue, the federal government was given N175.690 billion, the states got N89.113 billion, the local governments had N68.702 billion, and the benefiting states received N121.849 billion as 13 per cent derivation revenue.
In addition, from the N15.046 billion EMTL revenue, FAAC shared N2.257 billion to the federal government, disbursed N7.523 billion to the states and transferred N5.266 billion to the local councils.
Further, from the N671.392 billion Exchange Difference earnings, it gave central government N316.054 billion, the states N160.306 billion, the local government areas N123.590 billion, and the oil-producing states N71.442 billion as 13 per cent derivation revenue.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange recorded a 0.65 per cent gain on Friday, December 13, boosted by three equities admitted on the trading platform.
On the last trading session of the week, Okitipupa Plc appreciated by N2.70 to settle at N29.74 per share versus Thursday’s closing price of N27.04 per share, FrieslandCampina Wamco Nigeria Plc added N2.49 to end the session at N42.85 per unit compared with the previous day’s N40.36 per unit, and Afriland Properties Plc gained 50 Kobo to close at N16.30 per share, in contrast to the preceding session’s N15.80 per share.
Consequently, the market capitalisation added N6.89 billion to settle at N1.062 trillion compared with the preceding day’s N1.055 trillion and the NASD Unlisted Security Index (NSI) gained 19.66 points to wrap the session at 3,032.16 points compared with 3,012.50 points recorded in the previous session.
Yesterday, the volume of securities traded by investors increased by 171.6 per cent to 1.2 million units from the 447,905 units recorded a day earlier, but the value of shares traded by the market participants declined by 19.3 per cent to N2.4 million from the N3.02 million achieved a day earlier, and the number of deals went down by 14.3 per cent to 18 deals from 21 deals.
At the close of business, Geo-Fluids Plc was the most active stock by volume on a year-to-date basis with a turnover of 1.7 billion units worth N3.9 billion, followed by Okitipupa Plc with the sale of 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.3 million units sold for N5.3 million.
In the same vein, Aradel Holdings Plc remained the most active stock by value on a year-to-date basis with the sale of 108.7 million units for N89.2 billion, trailed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with a turnover of 297.3 million units worth N5.3 billion.
By Adedapo Adesanya
The Naira appreciated further against the United States Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) by N1.50 or 0.09 per cent to close at N1,533.00/$1 on Friday, December 13 versus the N1,534.50/$1 it was transacted on Thursday.
The local currency has continued to benefit from the Electronic Foreign Exchange Matching System (EFEMS) introduced by the Central Bank of Nigeria (CBN) this month.
The implementation of the forex system comes with diverse implications for all segments of the financial markets that deal with FX, including the rebound in the value of the Naira across markets.
The system instantly reflects data on all FX transactions conducted in the interbank market and approved by the CBN.
Market analysts say the publication of real-time prices and buy-sell orders data from this system has lent support to the Naira in the official market and tackled speculation.
In the official market yesterday, the domestic currency improved its value against the Pound Sterling by N12.58 to wrap the session at N1,942.19/£1 compared with the previous day’s N1,954.77/£1 and against the Euro, it gained N2.44 to close at N1,612.85/€1 versus Thursday’s closing price of N1,610.41/€1.
At the black market, the Nigerian Naira appreciated against the greenback on Friday by N30 to sell for N1,650/$1 compared with the preceding session’s value of N1,680/$1.
Meanwhile, the cryptocurrency market was largely positive as investors banked on recent signals, including fresh support from US President-elect, Mr Donald Trump, as well as interest rate cuts by the European Central Bank (ECB).
Ripple (XRP) added 7.3 per cent to sell at $2.49, Binance Coin (BNB) rose by 3.5 per cent to $728.28, Cardano (ADA) expanded by 2.4 per cent to trade at $1.11, Litecoin (LTC) increased by 2.3 per cent to $122.56, Bitcoin (BTC) gained 1.9 per cent to settle at $101,766.17, Dogecoin (DOGE) jumped by 1.2 per cent to $0.4064, Solana (SOL) soared by 0.7 per cent to $226.15 and Ethereum (ETH) advanced by 0.6 per cent to $3,925.35, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
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