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Obaseki, PDP disagree over N150bn 2018 budget

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…As Nigerian pipeline fire threatens gas supply to Ghana***

The Peoples Democratic Party in Edo State has faulted the 2018 budget signed into law by Governor Godwin Obaseki, describing it as a budget of “padding, duplication and deceit.”

Obaseki had last Friday signed the budget estimate of N150bn, after it was considered and approved by the House of Assembly on December 21, 2017.

The state Chairman of the PDP, Chief Dan Orbih, told journalists at a press briefing on Thursday in Benin that the budget did not address the challenges and hardship facing the state and its citizens.

Orbih accused the Obaseki administration of allegedly wasting funds on frivolous things, with 10 per cent of the budget allegedly devoted to the office of the governor.

Reacting, however, the Special Adviser to the Governor on Media and Communication Strategy, Crusoe Osagie, dismissed the allegations as a feeble attempt to discredit the state government, adding that the opposition party was “still stuck in primitive politics and a system that glorifies avarice.”

But the PDP chairman said, “But looking at the budget as presented by Obaseki, which he has since signed into law, you will agree with me that the 2018 budget, which is now a document that in every sense can be regarded as law, is a budget of padding, duplication and deceit.

“If you look at the budget, the total amount passed and signed into law is N150.09bn. Out of this sum, 10 per cent of the total sum is for the governor’s office.”

He alleged that the government voted N1.5bn for the governor’s “personal office,” N2.5bn for central administration, N2.150bn for government house protocol and entertainment, N1m monthly for essential drugs for the governor and his family, N4bn for government house special projects and another N4bn as security vote.

Orbih also alleged that over N469m was voted to provide equipment and construct the new accident and emergency ward of the Benin Central Hospital, more than two years after it was inaugurated by President Muhammadu Buhari.

“So, we need to know what exactly Governor Obaseki is doing with this money,” Orbih added.

The PDP chairman further accused the state government of allegedly voting N944.1m for the provision of infrastructure at the Edo University, Iyamho, being a public-private-partnership initiative, to the detriment of the state-owned Ambrose Ali University, Ekpoma, and Tayo Akpata University, Ekiadolor,.

But Osagie, in a statement, noted that the budget was realistic and designed to propel economic growth, even as he said that the All Progressives Congress was still fixing the damage allegedly caused by the “PDP’s years of misrule.”

The statement read in part, “Specifically, some roads that will be constructed this year were budgeted for by the PDP in the past and money was released but ended up in their private safes. These roads were not constructed.

“We have the same issues in the education sector where money was released to build schools, only to be stolen. But under Governor Obaseki, we can see roads being fixed everywhere and this will continue in the years to come.”

It added, “The PDP is bitter because there is no more money to share for birthday parties and ego trips. This budget will address the needs of the ordinary people of Edo.

“Hard as they (PDP) tried, they cannot say that Governor Obaseki allocated any sum to himself, his family or his political party, as is the stock in trade of the PDP. The budget is clear in its purpose.”

In the meantime, the supply of gas from Nigeria to Ghana may have suffered another setback following the damage caused by a fire incident on the Escravos-Lagos Pipeline System, which supplies gas from Escravos in the Niger Delta area to Lagos.

The pipeline, which supplies gas to power plants in the South-West, also feeds the West Africa Gas Pipeline System.

The $1bn WAGPS, operated by the West Africa Pipeline Company Limited, was built to supply natural gas from Nigeria to customers in Benin, Togo and Ghana.

Ghana gets about 25 per cent of its power supply through gas from Nigeria, which flows through the pipeline via Benin and Togo. The country has a deal with Nigeria to receive 120 million standard cubic feet of gas daily.

But gas supply from Nigeria to Ghana has often been curtailed in recent years by several challenges.

In 2016, the resurgence of militant attacks in the Niger Delta, which caused Nigeria’s oil production to plummet to a near 30-year low, significantly reduced gas supply to the West Africa gas pipeline.

On Tuesday, the fire incident on the ELPS led to a total collapse of Nigeria’s power grid, worsening the nation’s electricity woes.

The Group Managing Director, Nigerian National Petroleum Corporation, Dr. Maikanti Baru, on Wednesday ordered an immediate assessment of the damage caused by the fire to the pipeline, owned by the Nigerian Gas Processing and Transportation Company Limited, a subsidiary of the national oil firm.

The NNPC said to put off the fire, the line would require being isolated and depressurised, which might lead to a complete shutdown of the pipeline segment for repair works to be carried out.

Last year, the WAPCo said it was looking to capture new gas supply from Nigeria, with a focus on the Aje field offshore Lagos, as part of its key interventions to reposition the company for the dynamic market landscape.

The Managing Director, WAPCo, Mr. Walter Perez, who spoke in Lagos at a business forum organised by the Nigerian Gas Association, said the company was also seeking increased supply from the Escravos-Lagos Pipeline System.

Efforts to reach the General Manager, Corporate Affairs, WAPCo, Mrs. Harriet Wereko-Brobby, on the telephone on Thursday, were not successful as she had yet to answer calls or responded to a text message from our correspondent as of the time of filing this report.

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Economy

Subsidy Removal: Ibadan Deserts Stations, Lagos Shocked, P-Harcourt Watches, NLC-FG Talk Deadlocked

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…Nigerians Express Concerns Over Immediate Implementation***

The fuel queue which had created motley crowds of rowdy buyers on Tuesday and the early part of Wednesday in the few dispensing petrol stations, suddenly disappeared in Ibadan, as filling stations changed prices and hiked it to N500 per litre.

A petrol station on the old Ife Road, near the Loyola College, had dispensed fuel earlier at slightly above N200 per litre to grudging customers, until the Station managers received new directives, mandating them to hike their price.

They complied, and momentarily, the queue disappeared, as buyers fled the petrol station. Even those who had claimed that they came into the station with their vehicles on red light, suddenly had enough to drive home.

A correspondent who drove through the city, from Alakia, through Total Garden to the University of Ibadan, observed that more stations hitherto closed for business opened stations, immediately. Only the Bovas had little patronage because buyers could vouchsafe their integrity.

In the meantime, Nigerians have expressed concern over the sudden implementation of subsidy removal in spite of President Bola Tinubu’s assurance that it would not take effect immediately.

In Lagos, it was a matter of shock for buyers as the new price came up. 

On the Ogudu – Toll Gate- Berger axis, Commuters, particularly those on the Inter-State trips, expressed bewilderment, and started slashing whatever litres they had planned to buy.

Some drivers threatened to go back to their Parks, even as several passengers cough out additional fares.

The story from Port Harcourt, was however that shocked buyers simply watched, helplessly. (See video).

A cross section of residents of Ibadan, Oyo State, however expressed their feelings on Wednesday in separate interviews in Ibadan. 

An Entredepreneur, Mr Tobi Adeyemi, said the development was not a good one.

According to Adeyemi, the new administration should have provided some sort of respite for Nigerians considering the enormous hardship being faced by Nigerians.

“This will definitely affect prices of goods and services; from tomatoes sellers to foodstuffs; transportation, increase in fuel price and so on.

“We will all bear the brunt of it together. I only pity salary earners who are on a fixed income. Besides, I don’t believe this is the right timing,” Adeyemi said.

Also, a sales representative, Dr Adeyinka Adekunle, said the previous administration had budgeted for subsidy till the end of June.

“So, to me it was shocking to learn that the removal had taken effect from May 31 based on what the previous administration had done.

“Everything is sort of confusing now because of the budgetary provision for subsidy till June end,” Adekunle said.

He however, said a nation that was going to be great has to go through some teething periods.

In his remarks, an artisan, Mr Akinola Akinkunmi, said he has yet to comprehend the situation, because things were hard already and buying fuel at N500 per litre now would worsen the situation.

Akinkunmi said: “I cannot yet wrap my mind around how my business will survive; we are already struggling to make ends meet.

“With this development and absence of power supply from the distributing company, we are definitely going further down the poverty line.

“We need support from the government; we need help to survive this time,” Akinkunmi said.

Another entrepreneur, Mr Demola Adedeji, said the timing was not right as the economy had been in bad shape for some time now.

“At least, some things should have been put in place before the total removal of subsidy,” Adedeji said.

In his contributions, Mr Yinka Ajadi, a businessman, said that many people would go into depression as blood pressure of many Nigerians struggling to survive the situation would rise.

Ajadi said, “We can only hope for critical intervention at this time such as solving the problem of power and production inputs.”

Meanwhile, the orchestrated meeting between the Federal Government and the Nigerian Labour Congress (NLC) over subsidy removal has reportedly ended in a stalemate.

The Maritime First learnt that the meeting which was held at the Presidential Villa on Wednesday failed to attract any reasonable conclusion, as parties across the divide stuck to their guns.

It was further gathered that while the Organised Labour was represented by NLC National President, Joe Ajaero, and the President of the Trade Union Congress of Nigeria (TUC), Festus Osifo, and other top labour party notchers.

The Federal Government was however represented by people who included the former labour leader and former Edo State Governor, Adams Oshiomhole, President Bola Tinubu’s spokesman, Dele Alake, the Group Managing Director, Nigerian National Petroleum Company (NNPC) Limited Mele Kyari, and the Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele.

Specifically, the National President of the Nigeria Labour Congress, Joe Ajaero reportedly criticised the Federal Government, stressing the need to revert to the status quo ante,  because the government failed to either negotiate or protect the Nigerian workers’ interest, before yanking off the subsidy.

The Federal Government on the other hand had argued that the labour had all the time in the world to negotiate with the Buhari government and therefore lacked the moral rights to talk of negotiations now.

The Organised labour therefore said it was going to throw the inconclusive results of their meeting to the Congress whose decision would be final, a euphemism for a nationwide strike.

Consequently, Government representatives called for a rescheduled meeting in a bid to enable further discussions or negotiations.

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Fuel Subsidy Removal: Don Predicts Reduction In Fuel Price

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Prof. AbdulGafar Ijaiya of the Department of Economics, University of Ilorin, has expressed optimism at President Bola Tinubu’s inaugural remarks on the removal of fuel subsidies, saying this may reduce prices at the long run.

Ijaiya, who spoke on Monday in Ilorin, observed that with commitment from the Federal Government in revamping existing refineries alongside Dangote refineries, will increase the availability of petroleum products.

The expert who however explained that though such effect may not be felt immediately, noted that the present pump price is about N200, depending on filling stations across the country.

He questioned if the present fuel price at about N200 was as a result of the subsidy removal, adding that if it is not, then fuel may likely increase with about 50 per cent rate after the removal.

“But the thing is that very soon, what has gone wrong with the refineries will be corrected and Dangote refineries will commence by July/August,” he said.

Ijaiya, who teaches in the Faculty of Social Sciences of the university, pointed out that in the beginning there might be an increase in the prices of foods and services.

He however asserted that in a society like Nigeria where people are used to hike in prices, it would not mean much to the citizens.

“By Economics principle, we have adjusted our expenditure profile consumption to particular items. We have moved from consuming luxury and unnecessary items to necessary items.

“This means people go for what is necessary and do away with those that are not,” he said.

Ijaiya affirmed that in the long run, the fuel pump price will adjust downward and there would be more supply of the products.

He further added that when there are more supply of a particular product in the market, it will automatically reduce the price.

“If we have enough supply, with time and there are no other man-made distortion that has to do with our behaviour, I see us buying it between N80 and N100 per litre,” he predicted.

The economist also foresee filling station advertising and competing for sales, saying it will be good for the nation.

He, however, cautioned that “we are in an uncertain world”, but maintained that fuel subsidy removal would be good for the country eventually as only a minority are benefiting from it.

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NNPC Ltd, OML 130 Partners Conclude Lease Renewal Process  

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The Nigerian National Petroleum Company Limited (NNPC Ltd) and the Oil Mining Lease (OML) 130 Partners have closed out the lease renewal process for OML 130 to unlock additional value from the Asset for stakeholders.

The NNPC Limited announced the renewal of the OML 130 Production Sharing Contract (PSC) and conversion of the acreage to a Petroleum Mining Lease (PML), in accordance with the Petroleum Industry Act (PIA) 2021 provisions on Thursday.

During the ceremony which was presided over by the Permanent Secretary, Ministry of Petroleum Resources, Amb. Gabriel Aduda, five agreements were executed.

The NNPC Ltd management, in a statement, listed the agreements to include the PSC between NNPC Ltd and its Contractors, China National Offshore Oil Corporation (CNOOC) and South Atlantic Petroleum (SAPETRO) with Total Upstream Nigeria (TUPNI) as the operator.

The agreements include a Heads of Agreement (HoA) Amendment involving NNPC Ltd, TUPNI, SAPETRO, PRIME 130, and CNOOC and a Settlement Repayment Agreement (SRA) Addendum between NNPC and its Contractors (CNOOC and SAPETRO).

Others are Concession Contracts for one Petroleum Prospecting Licence (PPL) and three PMLs and Lease and License Instruments between NNPC, TUPNI, SAPETRO, PRIME 130, and Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

The NNPC Ltd said the milestone would pave the way to firm up Final Investment Decision (FID) on the Preowei, amounting to US$2.1 billion.

This will subsequently be followed by Egina South projects lined up by TUPNI and the OML 130 partners to introduce additional volumes to the best-in-class Egina Floating, Production, Storage and Offloading (FPSO) Vessel,’’ the company said.

Stakeholders in attendance at the signing ceremony were the NNPC Ltd Group Chief Executive Officer (GCEO), Malam Mele Kyari, the Chief Upstream Investment Officer (CUIO), and Mr Bala Wunti, Chief Strategy and Sustainability Officer, Oritsemeyiwa Eyesan.

The event also had in attendance the NUPRC Chief Executive, Mr Gbenga Komolafe, Managing Directors of TotalEnergies in Nigeria and CNOOC, Mr. Mike Sangstar, and Mr. Li Chunsheng, among others.

OML 130 is in the deep water Niger Delta, 130 kilometres offshore. The block contains the producing Akpo and Egina fields and the Preowei discovery.

To date, the Akpo field, via the Akpo FPSO, has produced over 646 million barrels of Condensate, while the Egina field, via the Egina FPSO, has produced over 233 million barrels of Crude Oil.

So far, about 1.6 Trillion cubic feet (TcF) of gas has been commercialised from both fields with an outstanding record of non-zero gas flare.

OML 130, currently producing 170,000 barrels per day, is the largest producer in TotalEnergies’ Nigeria portfolio and amongst the most prolific assets in Nigeria.

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