NNPC Lifts N461bn Crude In 21 Months

The Nigeria Extractive Industries Transparency Initiative (NEITI) has disclosed that the Nigerian National Petroleum Corporation (NNPC) lifted and utilised 1.28 trillion barrels of crude oil valued at $61.17 billion between January 2015 and September 2016.

A breakdown of the activities showed that international oil companies (IOCs) and independent companies lifted 809.98 million barrels, while government lifted 441.37million barrels and those with alternative financing arrangements lifted 30.15 million barrels.

According to the report released by NEITI, the total value of crude lifted for the 21 months was $61.17 billion, out which government, IOCs, independents and AFs lifted $20.9billion, $38.78 billion and $1.5 billion respectively.

The reports also revealed that only 9.74 per cent of the crude lifted by NNPC for domestic crude was delivered to the refineries.

In terms of production, the report noted that crude oil production during the period fluctuated with the highest production per month recorded in October 2015 when it hit 69.49 million barrels, while the lowest was recorded in August 2016 with 46.56 million barrels.

NEITI noted that when the production figures for January 2015 (68.07 million barrels) and September 2016 (49.53 million barrels) were compared, there was a decline in monthly production by 27.23 per cent.

It added that the same trend was noticeable in terms of average daily production per quarter, as 2.16 million barrels were produced daily on the average in the first quarter of 2015 as against the 1.60 million barrels average daily production per quarter in the third quarter of 2016.

The report attributed the fall in oil production to growing vandalism and militancy in the Niger Delta region, but added that production fluctuation was noticeable even before the onset of militant activities.

NEITI submitted that the fall in daily production may have negatively impacted the implementation of the 2016 budget, given that the budget was predicated on a daily production of 2.2 million barrels.

NEITI commended the NNPC for taking the initiative to provide up-to-date information to Nigerians on the state of the country’s petroleum sector through the monthly financial and operations reports that the national oil company has been publishing since August 2015.

It, however, called on NNPC to open up more, especially by living up to its self-declared commitments to openness, transparency and accountability.

The reported noted that the NNPC Group consistently operated in the red, posting losses of N418.97 billion in 19 months out of the 21 months under review, while making profit in only two months.

According to the report, volatility was also noticeable in the group’s losses, ranging from N3.55 billion in January 2016 to N45.49 billion in September 2015.

On the two months the Corporation made profit, the report stated, “This was in January 2015 when the Group made a profit of N7.6 billion and in May 2016 when it made a profit of N0.27 billion, with total profit in 21 months coming to N7.87 billion, as against the loss of N418.97 billion, with total loss coming to N411.1 billion.”

The report stated that the daily average sales of petrol fluctuated between 15.23 million litres in September 2015 and 35.09 million litres in May 2016. The daily average sales for petrol for the 21 months came to 24.24 million litres, while the daily average sales diesel and kerosene came to 1.06 million litres and 3.12 million litres respectively.

The report noted that NNPC had, in its monthly financial and operations reports, voluntarily made some transparency-related commitments that are yet to be fulfilled.

“While we commend NNPC for opening up and for consistently doing so,” said NEITI in the Occasional Paper Series, “the monthly reports also reveal a few things that NNPC has committed to do but which have not yet been done. NEITI is particularly interested in NNPC delivering on these commitments to further promote openness, transparency and accountability in the nation’s extractive industry.”

These commitments, it said, include: development of an index for measuring progress and improving transparency; publication of annual audited report by the second quarter of the succeeding year; undertaking a value-for-money audit of all the federation’s joint ventures, and reviewing existing production sharing contracts (PSCs).

Oil Price Rises To $55.61

The price of Brent crude rose to $55.61 per barrel yesterday, up 26 cents from the previous day in what will be good news to oil-dependent Nigeria.

The Nigerian government has repeatedly lamented the impact of the fall in global oil prices on its economy which is suffering from a recession.

The President Muhammadu Buhari administration has pledged to diversify the economy with a focus on agriculture and solid minerals.

Nigeria was one of the OPEC members that agreed to a reduction in oil export to help bolster oil prices which have been low for over a year, going below $40 dollars a barrel.

The country was, however, exempted from the slash due to not being able to meet its original quota as a result of militancy in the oil producing Niger Delta region.

To ensure proper preparation for any fall in oil price, the Nigerian government projected an oil price of $42.5 per barrel in the 2017 budget.

Yesterday, the U.S. dollar held near 14-year peaks as global yield spreads moved inexorably in its favour, while a falling yen lifted Japanese shares to a one-year top.

U.S. crude futures were up 32 cents at $53.62 a barrel, while benchmark Brent crude futures added 26 cents to 55.61 dollars.

The Nikkei added 0.3 per cent in thin trade, while Australia’s main index climbed 0.6 per cent to its highest in 17 months after Wall Street racked up more records.

Japan’s government upgraded its overall assessment of the economy yesterday, echoing a more upbeat view the Bank of Japan delivered the day before.

The dollar index, which measures it against a basket of currencies, stood at 103.100, having touched 103.65, its highest since December 2002.

The euro was a fraction firmer at $1.0413 dollars. On Wall Street, the Dow ended just 25 points shy of the magical 20,000 barrier, helped by a 1.68 per cent gain in Goldman Sachs.

Stocks have been on a tear since the November 8 presidential election, with the Dow up nine per cent and the S&P 500 6 per cent on bets that President- elect Donald Trump’s plans for deregulation and infrastructure spending might boost profits and growth.

The Dow rose 0.46 per cent on Tuesday, while the S&P 500 gained 0.36 per cent and the Nasdaq0.49 per cent. Eight of the 11 major S&P sectors rose, led by a 1.23 per cent jump in the financial index.

After the bell, Nike rose three per cent on a strong quarterly report from the sports apparel seller.

European shares scaled 11-month highs on Tuesday as Italy’s banking index rose 2.3 per cent after the government decided to seek parliamentary approval to borrow 20 billion Euros to underwrite the stability of its banks.

Emerging markets have not been nearly as thrilled by Trump’s win, as the threat of tariffs has stirred fears of a trade war while rising U.S. yields have attracted funds away.

Benchmark 10-year U.S yields have climbed almost 80 basis points since early November to reach 2.57 per cent.

Data from the Institute for International Finance showed non-resident investors had pulled 23 billion dollars from emerging market portfolios since early October.

MSCI’s broadest index of Asia-Pacific shares outside Japan inched up 0.3 per cent yesterday but that followed a string of losses.

Gold held at $1,133.80 an ounce as a firm U.S. dollar kept it pinned near last week’s 10-1/2-month low of $1,122.35.

Read more at http://leadership.ng/news/cover-stories/564795/nnpc-lifts-n461bn-crude-in-21-months


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About Cynthia Adigwe 3703 Articles
She is a prolific writer and has special interest on writing about business and opportunities. She can be contacted via [email protected]

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