Select Menu



Market Update

Market Update




News Headlines




Market Gainers



Market Losers


Barely one month after the Minister of State for Petroleum, Dr. Ibe Kachikwu, negotiated a $15 billion crude-for-cash swap deal with India that would see the Indian government making an upfront payment to Nigeria for crude purchases, Indian refiners have indicated interest in increasing Nigerian crude imports from nine million metric tonnes in 2016 (MMTPA) to 11 million metric tonnes in 2017.

By the terms of the deal, which are yet to be agreed, the $15 billion would be repaid on the basis of firm term crude contracts over some years and in consideration for Indian public sector (PSU) companies collaborating in the refining sector.

Other methods of repayment include: exploration and production activities on a government-to-government basis by Indian PSU companies, and long-term contracts for the supply of crude to Indian PSU companies from Nigeria.

Successful bidders for Nigeria’s crude oil term lifting contracts for 2017 will emerge by the middle of this month.

Indian refiners such as Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) currently have crude oil lifting contracts for 2016 with the Nigerian National Petroleum Corporation (NNPC).

However, NNPC’s Group Executive Director, Refineries, Anibor Kragha, told S&P Global Platts in an interview on the sidelines of the Petrotech conference in New Delhi on Monday that the Indian state-run refiners were pushing for an increase in crude oil allocations from Nigeria.

“Three Indian companies said that they were looking for a combined total of 11 million metric tonnes in 2017 from nine million mt this year,” Kragha said.

About seven barrels of crude make one metric ton.

“Now what they will get is a balance between term contracts and (spot) sales contracts,” he added.

“We just came out of a meeting with key Indian oil companies and they are pushing to get incremental allocations for the term contracts. We explained to them that there needs to be a balance.

“Once Nigerian output recovers, it will increasingly look towards India as the major buyer of its crude. Indian demand is very positive for us. A vibrant Indian economy is good for us,” Kragha explained.

Under the crude term contracts, Nigeria exports around 1.17 million bpd of Nigerian crude, out of the 2.2 million bpd production that is sold by contract holders to end-users, refiners and other buyers.

The country’s production dropped in recent months to a 20-year low as a result of renewed militancy in the Niger Delta.

However, Kachikwu also told journalists on the sidelines of the New Delhi conference that the total production was around 1.9 million bpd, including 300,000 bpd of condensates.

Kragha said negotiations were ongoing and that if the deal is successful and Nigerian output recovers, the country would “increasingly look towards India” as the major buyer of its crude.

“Indian demand is very positive for us. A vibrant Indian economy is good for us,” he added.

In 2015-16, India imported nearly 23.7 million metric tonnes of crude (nearly 12 per cent of India’s overall imports) and over 2MMTPA of LNG from Nigeria.

Following the $15 billion negotiation, the two countries agreed to work on a Memorandum of Understanding (MoU) to facilitate investments by India in the Nigerian oil and gas sector; specifically in areas such as the term contracts, participation of Indian companies in the refining sector, oil and gas marketing, upstream ventures, the development of gas infrastructure, and in the training of oil and gas personnel in Nigeria.

The MoU is expected to be firmed up this month during PETROTECH-2016.

According to a source from an Indian refiner, “Nigerian crude is a must have for most of our refineries, especially the older ones, which have been designed to run light sweet crude.

“Despite all the militancy issues, we still buy Nigerian crude, as our refineries need it. We will continue to buy Nigerian crude, but we want them to supply us with more,” he said.

India, which is one of the world’s fastest growing economies, has seen its gasoline and gasoil demand climb sharply over the past few years.

This has encouraged Indian refineries to buy more Nigerian crude.


A bill seeking to set aside 20 percent of the country’s annual budget for constituency projects scaled through second reading at the Senate yesterday.

If the bill becomes law, the constituency projects will get at least N1.4 trillion out of the 7.3trillion 2017 budget estimates to be presented to the National Assembly by President Muhammadu Buhari on Wednesday.

The constituency projects are mainly for provision of feeder roads, schools rehabilitation, building of market stalls, boreholes, provision of empowerment items such as sewing machines, grinding machines, knitting machines as well as vehicles including motorcycles, tricycles and cars.

Lawmakers will insert the projects under subheads in the budgets of ministries and agencies that they supervise. The agencies are expected to execute the projects based on specification and guidance by benefitting lawmakers.

The ‘Constituency Projects Bill, 2016’ sponsored by Senator Stella Oduah (PDP, Anambra) seeks to grant legal backing to the provision for constituency projects in the annual budget of the Federation by a minimum of 20%. 

Oduah said: “One of the unique features of our democratic journey so far is the concept of ‘Constituency Projects’. Available statistics show that 70 per cent of Nigerians live in the rural areas and the intention of the bill is to ensure that good governance is delivered to these crucial areas.

“The bill is also intended to correct the top-bottom approach of governance and replace it with the bottom top approach. Constituency project in recent time is one of the ways to attract federal presence to our people,”she said.

She said if not for these projects, majority of federal constituencies would not have a single federal project due to lopsided nature of project allocation in the budget.

“The constituency project is not peculiar to Nigeria alone. There are similar mechanisms in other developing countries. For instance, the constituency development fund has been institutionalized in Kenya, Uganda, India and Tanzania,”she said. 

Contributing to the debate, the Chief Whip of the Senate, Senator Olusola Adeyeye advised that the 20 percent should be based on capital projects. 

“This is not money given to Senators or Reps, it is money meant for specific projects. At the moment, it is N100billion for 109 Senatorial Districts and 360 Federal constituencies. That’s 1.5 percent of the Federal Budget,” he said. 

In his remark, the Senate President, Bukola Saraki, said constituency projects ensure equity in the distribution of federal projects.

“I don’t think there is anything that ensures equity in the country like the constituency projects. Our responsibility is to provide the projects to our constituencies, full stop,”he said. 

He referred the bill to the committees on Finance and Appropriation for further legislative actions with a 4-week time frame. 

N1.4tr (20 % of the 2017 budget estimates) is what the 19 northern states budgeted for capital projects in 2016.

The idea of constituency projects has been a subject of controversy for a very long time. Former President Olusegun Obasanjo, being one of its staunchest critics, had at various times spoken against it, describing it as “a veritable source of corruption.”

In July this year, the Senators summoned the Secretary to the Government of the Federation, Babachir David Lawal for saying it would not be possible to fund the constituency projects of National Assembly members as contained in the 2016 Budget because of the paucity of funds.

Source:Daily Trust

At least, 14 people were feared dead yesterday in an accident involving bullion vans, a fuel tanker, a commercial bus and cars on the ever-busy Benin-Asaba-Onitsha Expressway. The victims included officials of the Central Bank of Nigeria (CBN), policemen and passengers of commercial buses.

Two of the 10 bullion vans which were in a convoy conveying money from Asaba end of the expressway were said to have collided with a tanker, which burst into fire, before two commercial buses ran into the accident. For hours, those travelling on the road from the eastern part of the country to the western part were trapped by the accident. The accident caused gridlock which made motorists, especially commuters who had important appointments to catch up with, to begin to gnash their teeth.

Drivers, who had the opportunity, diverted to the other side of the expressway, which worsen the gridlock. Many passengers disembarked from the vehicles they were traveling in and trekked long distances before securing other vehicles to continue their journey. Millions of naira notes were burnt to ashes in the accident, which occurred at the slope in Abudu on Orhionwomwon River Bridge towards the boundary town between Edo and Delta states.

Stern looking military officers, mobile policemen and officials of the Federal Road Safety Commission (FRSC) were helpless as the vehicles had no fire extinguishers. The security operatives were sent to the scene to safeguard other bullion vans for fear of being attacked. A witness, who simply identified herself as Faith, said a fully-loaded commercial bus, a tanker, a pick-up van and three smaller vehicles were involved.

She said: “Our own vehicle narrowly escaped the accident when a 14-seater passenger bus that was ahead of our own ran into the burning tanker and a pick-up van.

Three other cars skidded off the road into the river while trying to avoid the crash.” According to her, the smoke which enveloped the area was that of mint notes but all other bullion vans were surrounded by combined security agents.

When contacted, the Asaba Controller of CBN, Mrs. Elizabeth Agu, said a bullion van only developed some faults on the expressway and that it was being fixed. She said: “They put off a spark underneath the vehicle very far from the back where the money is. So, it is on its way. I just called the branch. Just publish the truth because our money is in aluminium boxes.”

The Delta State Police Public Relations Officer (PPRO), DSP Andrew Aniamaka, said he was yet to receive any signal about the incident. According to him, the scene of the accident did not fall within his command’s purview. He said: “I am not aware. You are the one giving me the information. I need to get my facts right. Besides, Abudu in Orhionmwon Local Government is in Edo State. But give me time to confirm what happened.”

When contacted, the Delta State Sector Commander of the FRSC, Mr. Rindom Kumven, said several vehicles were involved in the crash. Kumven said although the accident occurred within the jurisdiction of Edo State, his command had to mobilise rescue team of his men at Issele-Uku Unit to join in the rescue operations.

He said: “Multiple vehicles were involved in the crash, and actually there was loss of lives but I can’t give you the figure right now. The tanker was carrying petroleum product and that was why it went up in flames.

“For now, I can’t give you a comprehensive report about the cause of the accident but even though it occurred in Edo State, I called men at Issele-Uku to mobilise to the scene for rescue operation.”

But when contacted, the Edo State Police Public Relations Officer (PPRO), DSP Moses Nkombe, said that the accident occurred outside state command’s jurisdiction. He said: “The accident happened within the jurisdiction of Delta State police command.”

Source:New Telegraph

The Economic and Financial Crimes Commission (EFCC), is said to have released a former Minister of the Federal Capital Territory (FCT), Senator Bala Mohammed, from its custody.

It was learnt that Mohammed, who had been held for over a month, was freed in compliance with an order of an FCT High Court for his release.

Mohammed, whom the EFCC is investigating over alleged land allocation fraud, was said to have regained his freedom on Thursday evening.

Efforts to confirm the development from the EFCC’s spokesman, Mr. Wilson Uwujaren, last night failed, as his line was not available.

Source:New Telegraph

The suspended former chairman of the House of Representatives appropriation committee, Abdulmumin Jibrin, has said that the resolution by the House to invite him to respond to two petitions against him was an attempt to divert attention from the fraud allegedly committed by some key members.

But in his reaction yesterday, Jibrin said the “disgraceful action” was an extension of the witch-hunt allegedly launched against him by “Speaker Yakubu Dogara and his corrupt cabal in the House to paint me in a negative light and divert attention away from the corruption hanging on their necks.”

Jibrin said, in a statement that “it is curious that the ethics committee refused to admit and rejected 18 petitions against the Speaker and some principal officers of the House bothering on monumental budget fraud, unprecedented abuse of office and massive corruption, but shamelessly reduced the entire activities of the ethics committee to witch-hunt Hon Jibrin.

“This latest assault is coming because the security and anti-graft agencies have made advance progress on investigation which has led to the freezing of the accounts of some principal officers,” he said.

Source:Daily Trust