Nigerian press zooms in on $742bn earnings from oil in 21 years, others

APA – Lagos (Nigeria)
The report that Nigeria earned $741.5bn and N635.3bn from the oil/gas and solid minerals sectors respectively, between 1999 and 2020, a period of about 21 years is one of the trending stories in Nigerian newspapers on Thursday.
The Punch reports that Nigeria earned $741.5bn and N635.3bn from the oil/gas and solid minerals sectors respectively, between 1999 and 2020, a period of about 21 years, the Nigeria Extractive Industries Transparency Initiative announced on Wednesday.
NEITI’s Executive Secretary, Ogbonnaya Orji, announced this at a stakeholders’ roundtable organised by the agency in Abuja for the review and approval of NEITI 2021 Audit Reports for the oil, gas and solid minerals sectors.
The latest audit reports were submitted to the agency by the independent administrators – Messrs Taju Audu & Co, and Amedu Onekpe & Co.
In his address at the event, Orji said, “So far, NEIT! has conducted a total of 13 cycles of reconciliatory reports in the oil and gas sector and 11 cycles of reports in the solid minerals sector. These reports have disclosed a total revenue earnings to the government of $741.48bn from the oil and gas sector and N635.3bn from the solid minerals sector.
“These earnings were between the years 1999-2020 (oil and gas) and 2006-2020 (solid minerals sector earnings). In addition, NEITI reports have disclosed that Nigeria lost over 619.7 million barrels of crude oil valued at $46.16bn or N16.25tn from 2009 to 2020 from theft and sabotage.
“This amounts to losing over 140,000 barrels of crude valued at $10.7m daily. Furthermore, NEITI has reported on subsidy payments from the years 2005 to 2021 and its huge negative consequences to the nation.”
Orji stated that in these reports, it was revealed that Nigeria had spent $74.39bn, “which translates to N13.7tn. By the above figures, Nigeria spent an average of N805.7bn annually, N67.1bn monthly or N2.2bn daily.”
The newspaper says that the continued shutdown of operations by Nigerian Liquefied Natural Gas Ltd is a looming danger to the country’s annual production of 22 million tonnes of gas, The PUNCH can authoritatively report.
Last week Tuesday, NLNG spokesman, Andy Odeh, said the force majeure it declared in October 2022 due to widespread flooding that disrupted supplies continued.
Force majeure refers to unexpected external circumstances that prevent a party to a contract from meeting obligations.
“The force majeure still subsists as the unavailability of upstream gas suppliers’ major liquids’ evacuation pipelines, occasioned by sabotage and vandalism, still impacts feed gas supplies,” Odeh said in an emailed response to an enquiry on the issue.
Force majeure is a common clause in contracts, which essentially frees both parties from liability or obligation when an extraordinary event or circumstance beyond the control of the parties, such as a war, strike, riot, crime, epidemic or sudden legal change prevents one or both parties from fulfilling their obligations under the contract.
He added that it had continued to collaborate with customers to “minimise the impact of the consequent gas supply shortage”.
The company is an Incorporated Joint Venture owned in the following proportions: Nigerian National Petroleum Company Limited, 49 per cent; Shell Gas B.V., 25.6 per cent; TotalEnegies Gaz & Electricité Holdings, 15 per cent; and Eni International N.A. N.V. S.àr.l, 10.4 per cent.
It has a production capacity of 22 million tonnes per annum, delivered mostly to clients in Europe, including Galp and Endesa with whom it has long-term contracts.
The Vanguard reports that the Naira yesterday recorded significant gain against the dollar in the parallel market and the official Investors and Exporters, I&E window even as the forex market received a major supply boost as the NNPC Limited secured a $3 billion facility from the AfreximBank aimed at stabilising the exchange rate.
Vanguard survey showed that the Naira appreciated by N28 or 3.8 per cent in the parallel market, as the exchange rate fell to N885 per dollar from N920 per dollar on Tuesday. The Naira also appreciated by N21.44 per dollar or 3.25 per cent in the official I&E window as the indicative exchange rate fell to N759.86 per dollar from N781.30 per dollar on Tuesday.
Parallel market sources who spoke to Vanguard attributed the appreciation of the Naira to the recent pronouncement of the Acting Governor, Central Bank of Nigeria, CBN, Mr. Folashodun Shonubi, which signalled that the apex bank will soon unveil measures to boost forex supply, tackle speculators in a bid to address continued depreciation of the naira.
In line with this trend, and in a bid to support the ongoing fiscal and monetary policy reforms of the federal government, the NNPC Limited yesterday said it has signed a Commitment Letter and Term Sheet with AfreximBank for an emergency $3 billion crude oil repayment loan.
The company said the agreement was jointly signed by both parties at the bank’s headquarters in Cairo, Egypt.
The newspaper says that amidst sustained inflationary pressures in the Nigerian economy, the Manufacturers Association of Nigeria (MAN) has listed the impact already being felt in the real sector.
The Lagos Chamber of Commerce and Industry (LCCI) also took similar position yesterday with a call on the federal government, FG, to step up efforts to tackle costs of staple foods in the country.
Recall that on Tuesday the National Bureau of Statistics (NBS) reported that headline inflation rate accelerated to 24.08 percent in July 2023, the sixth consecutive month rise.
Responding to the NBS report in a statement made available to Vanguard yesterday, Director General, MAN, Segun Ajayi-Kadir, said in addition to the increase in the cost of production some of the impacts of the rising inflation rate on manufacturing include: reduced profit margin; supply chain disruptions; uncertainty in planning; and reduction of consumer spending.
On her part, Director General, LCCI, Dr Chinyere Almona, stated: “LCCI is concerned that there may be more inflationary pressures in the coming months due to the volatility of the Naira as well as the lagged effects of subsidy removal and its transmission to general prices.
“The government should step up efforts to tackle food costs, especially staple food items. The chamber implores the government to hasten the provision of the anticipated palliatives to lessen the impact of the rising trend in prices on economic agents.”
GIK/APA