Economy
SERAP to Block FG’s Access to Unclaimed Dividends, Dormant Funds
By Adedapo Adesanya
The Socio-Economic Rights and Accountability Project (SERAP) has sent an open letter to President Muhammadu Buhari, calling for the federal government to halt plans to borrow about N895 billion worth of unclaimed dividends and funds in dormant accounts.
In a letter signed by its deputy director, Mr Kolawole Oluwadare, the group tackled the decision which was contained in the Finance Act, signed into law by Mr Buhari last month.
The act would allow the government to borrow unclaimed dividends and dormant account balances owned by Nigerians in any bank in the country.
SERAP wrote that borrowing unclaimed dividends and funds in dormant accounts amount “to an illegal expropriation, and would hurt poor and vulnerable Nigerians who continue to suffer under reduced public services and ultimately lead to unsustainable levels of public debt.”
It continued, “The right to property extends to all forms of property, including unclaimed dividends and funds in dormant accounts. Borrowing these dividends and funds without due process of law, and the explicit consent of the owners is arbitrary, and as such, legally and morally unjustifiable.
“The borrowing is neither proportionate nor necessary, especially given the unwillingness or inability of the government to stop systemic corruption in ministries, departments, and agencies (MDAs), cut waste, and stop all leakages in public expenditures. The borrowing is also clearly not in pursuit of public or social interest.
“The security of property, next to personal security against the exertions of government, is of the essence of liberty. It is next in degree to the protection of personal liberty and freedom from undue interference or molestation. Our constitutional jurisprudence rests largely upon its sanctity.”
The body challenged the President, noting that rather than pushing to borrow unclaimed dividends and funds in dormant accounts, “your government ought to move swiftly to cut the cost of governance, ensure review of jumbo salaries and allowances of all high-ranking political office holders, and address the systemic corruption in MDAs, as well as improve transparency and accountability in public spending.
“The borrowing also seems to be discriminatory, as it excludes government’s owned official bank accounts and may exclude the bank accounts of high-ranking government officials and politicians, thereby violating the constitutional and international prohibition of discrimination against vulnerable groups, to allow everyone to fully enjoy their right to property and associated rights on equal terms.
“SERAP is concerned that the government has also repeatedly failed and/or refused to ensure transparency and accountability in the spending of recovered stolen assets, and the loans so far obtained, which according to the Debt Management Office, currently stands at $31.98 billion.
“SERAP notes growing allegations of corruption and mismanagement in the spending of these loans and recovered stolen assets.
“We would be grateful if your government would drop the decision to borrow unclaimed dividends and funds in dormant accounts, and to indicate the measures being taken to send back the Finance Act to the National Assembly to repeal the legislation and remove its unconstitutional and unlawful provisions, including Sections 60 and 77, within 14 days of the receipt and/or publication of this letter.
“If we have not heard from you by then as to the steps being taken in this direction, the Registered Trustees of SERAP shall take all appropriate legal actions to compel your government to implement these recommendations in the public interest and to promote transparency and accountability in public spending.
“The government cannot lawfully enforce the provisions on Crisis Intervention Fund and Unclaimed Funds Trust Fund under the guise of a trust arrangement, as Section 44(2)[h] of the Nigerian Constitution 1999 [as amended] is inapplicable, and cannot justify the establishment of these funds.”
SERAP noted that while targeting the accounts of ordinary Nigerians, the Finance Act exempts official bank accounts owned by the federal government, state government or local governments or any of their ministries, departments or agencies.
“Our requests are brought in the public interest, and in keeping with the requirements of the Nigerian Constitution, the country’s international human rights obligations including under the African Charter on Human and Peoples’ Rights to which Nigeria is a state party, and which has been domesticated as part of the country’s domestic legislation.
“According to our information, your government has reportedly completed plans to borrow an estimated N895 billion of unclaimed dividends and funds in dormant accounts using the Finance Act 2020 you recently signed into law.
“Under the law, the government will be able to access and take without consent unclaimed dividends and funds in dormant accounts in any bank, on the basis of the vague and undefined ‘Crisis Intervention Fund,’ and patently unlawful ‘Unclaimed Funds Trust Fund’.
“The government is justifying the borrowing on the ground that it would improve access of the Federal Government to much-needed funds, and remove the burdens of foreign exchange and punitive loan conditions imposed by multilateral lenders.
“According to the Finance Act, the operation of the trust fund is to be supervised by the Debt Management Office (DMO) and governed by a governing council chaired by the finance minister and a co-chairperson from the private sector appointed by you.
“The Nigerian Constitution in Section 44(1) provides that, ‘no moveable property or any interest in an immovable property shall be taken possession of compulsorily and no right over or interest in any such property shall be acquired compulsorily in any part of Nigeria except in the manner and for the purposes prescribed by law.
“Similarly, Article 14 of the African Charter on Human and Peoples’ Rights, and Article 17 of the Universal Declaration of Human Rights guarantee the right to property and prohibit the arbitrary deprivation of the right. Thus, everyone is entitled to own property alone as well as in association with others.
“Respect for the right to property is important to improve the enjoyment of other basic human rights and to lift Nigerians out of poverty. The Nigerian Constitution and international human rights law limit the ability of any government to interfere with private property without any legal justifications.”
By Adedapo Adesanya
Seplat Energy Plc will revive hundreds of Nigerian oil wells laying fallow after completing the acquisition of Mobil Producing Nigeria Unlimited (MPNU) from ExxonMobil.
The company said it aims to lift oil output to about 200,000 barrels a day, a move that will help boost Nigeria’s oil production levels, as it aims to reach 2 million barrels per day next year.
The transaction, according to Seplat, “is transformative for Seplat Energy, more than doubling production and positioning the company to drive growth and profitability, whilst contributing significantly to Nigeria’s future prosperity.”
The completion of the Seplat-ExxonMobil deal has created Nigeria’s leading independent energy company, with the enlarged company having equity in 11 blocks (onshore and shallow water Nigeria); 48 producing oil and gas fields; 5 gas processing facilities; and 3 export terminals.
Recall that the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) in October approved the deal as part of a series of approvals, while it blocked Shell’s asset sale of up to $2.4 billion to the Renaissance consortium.
The acquisition of the entire issued share capital of MPNU adds the following assets to the Seplat Group: 40 per cent operated interest in OML 67, 68, 70 and 104; 40 per cent operated interest in the Qua Iboe export terminal and the Yoho FSO; 51 per cent operated interest in the Bonny River Terminal (‘BRT’) NGL recovery plant; 9.6 per cent participating interest in the Aneman-Kpono field; and approximately 1,000 staff and 500 contractors will transition to the Seplat Group.
MPNU adds substantial reserves and production to Seplat Energy; 409 million barrels of oil equivalent (MMboe) 2P reserves and 670 MMboe 2P + 2C reserves and resources as at 30 June 2024 and 6M 2024 average daily production of 71.4 kboepd (thousand barrels of oil equivalent).
Business Post reports that Seplat will be part of the payment this year, and will defer some to next year,
Speaking on the transaction, the Chairman of Seplat Energy, Mr Udoma Udo Udoma commended President Bola Tinubu for supporting this transaction and appreciated the support and diligence of the various ministries and regulators for all the work to reach a successful conclusion.
“We are delighted to welcome the MPNU employees to Seplat Energy. We are excited to begin our journey in a new region of the country, and we look forward to replicating the positive impacts we have achieved within our communities in our current areas of operations.
“Seplat’s mission is to deliver value to all our stakeholders, and we treasure the good relationships we have developed with the government, regulators, communities and our staff.”
On his part, the chief executive of Seplat Energy, Mr Roger Brown, described the acquisition as a major milestone, adding, “I extend my thanks to the entire Seplat team for their hard work and perseverance to complete this transaction.
“MPNU’s employees and contractors have a strong reputation for safety and operational excellence, and I welcome them to the Seplat Energy Group.
“We have acquired a company with one of the best portfolios of assets and related infrastructure in a world-class basin, providing enormous potential for the Seplat Group. Our commitment is to invest to increase oil and gas production while reducing costs and emissions, maximising value for all our stakeholders.
“MPNU is a perfect fit with our strategy to build a sustainable business that can deliver affordable, accessible and reliable energy for Nigeria alongside attractive returns to our shareholders”.
By Adedapo Adesanya
The National Pension Commission (PenCom) is projected to close the year with over N22 trillion in pension assets impacted by challenges like inflation and monetary policies.
This is according to PenCom Director-General, Mrs Omolola Oloworaran, at a press conference in Abuja on Thursday.
She said as of October 2024, the Contributory Pension Scheme (CPS) had 10.53 million registered contributors and pension fund assets worth N21.92 trillion.
Speaking at the conference-themed Tech-driven Transformation Shaping the Pension Landscape, which showcased PenCom’s strategic commitment to innovation, she said that the numbers reflected the agency’s unwavering commitment to fund safety, prudent management, and sustainable growth.
She explained that the pension environment was impacted by the wider economic challenges facing the country, noting that the sector battled multi-year high inflation, Naira devaluation, and the lingering effects of unorthodox monetary policies by the Central Bank of Nigeria (CBN).
Business Post reports that the apex bank hiked interest rates by 875 basis points this year alone to tackle persistent inflation which peaked at 33.8 per cent as of October.
She said that these challenges eroded the real value of pension funds and impacted contributors’ purchasing power.
“To address these issues, the commission has initiated a comprehensive review of its investment regulations.
“It is focusing on diversifying pension fund investments into inflation-protected instruments, alternative assets, and foreign currency-denominated investments.
“The goal is to safeguard contributor savings and ensure resilience against future economic volatility,” she said.
She restated the commission’s commitment to expanding pension coverage, particularly through the advanced micro-pension plan designed to encourage participation from the informal sector using technology.
“This initiative will make it easier for everyday Nigerians to save for retirement, aligning with our vision of inclusive growth and financial stability for all.
“The backlog in retirement benefits for retirees of the Federal Government’s Ministries, Departments, and Agencies (MDAs) will soon be settled.
“The federal government recently disbursed N44 billion under the 2024 budget to settle approved pension rights.
“We are collaborating with the Federal Government to institutionalise a sustainable solution to ensure retirees receive their benefits promptly, eliminating delays,” Mrs Oloworaran said.
She said that PenCom’s technology-driven transformation aimed to make the CPS more accessible, reliable, and sustainable.
“From data management to seamless contributions and regulatory supervision, we are paving the way for a future where the pension industry serves all Nigerians effectively,” she said,
Mrs Oloworaran also said that the e-application portal for pension clearance certificates has replaced the manual processes and enhanced the ease of doing business in the sector.
“Since its deployment, 38,528 pension clearance certificates have been issued. This initiative ensures compliance and secures the future of Nigerians working in organisations that interact with the government,” she said.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange closed flat on Thursday, December 12 after it ended the trading session with no single price gainer or loser.
As a result, the market capitalisation remained unchanged at N1.055 trillion as the NASD Unlisted Security Index (NSI) followed the same route, remaining at 3,012.50 points like the previous trading session.
However, the activity chart witnessed changes as the volume of securities traded at the bourse went down by 92.5 per cent to 447,905 units from the 5.9 million units transacted a day earlier.
In the same vein, the value of securities bought and sold by investors declined by 86.6 per cent to N3.02 million from the N22.5 million recorded in the preceding trading day.
But the number of deals carried out during the session remained unchanged at 21 deals, according to data obtained by Business Post.
When trading activities ended for the day, Geo-Fluids Plc remained the most active stock by volume (year-to-date) with 1.7 billion units sold for N3.9 billion, Okitipupa Plc came next with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc was in third place with 297.5 million units worth N5.3 million.
Also, Aradel Holdings Plc remained the most active stock by value (year-to-date) with 108.7 million units worth N89.2 billion, followed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.5 million units sold for N5.3 billion.
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