Energy
Energy firms owe Nigerian banks N1.54trn
……Sector’s non-performing loans stands at N32bn
LAGOS – Energy industry firms, including those operating in the power and oil and gas sectors owe banks in Nigeria over N1.544 trillion, about $10 billion, while the total bad debts profile of the firms stand at N31.65 billion.
Biztellers gathered the figures from the year end, December 31, 2011 financial statements of the banks released to investors and others stakeholders last year.
Although the 2012 financial statements of the banks are still being expected, but it is expected that banks will begin to release the results from the end of March, with analysts projecting that the figures will rise.
A breakdown of the total non-performing loans shows that the bad debts of oil and gas firms currently stands at over N29.214 billion, while those from the power sector stands at N2.44 billion.
These debts, recorded in the books of 10 of the commercial banks in Nigeria, were classified as Non-Performing Loans, NPL, and might see the banks transferring the loans to the Asset Management Corporation of Nigeria, AMCON.
Despite the high non-performing loans and the challenges faced by the banks in lending to firms in the energy sector in the last couple of years, the banks still gave out loans totaling N1.544 trillion to oil and gas and power firms during the period in review.
However, a number of banks refused to disclose their exposures in their reports. They are Access Bank Plc, Union Bank Nigeria Plc and Skye Bank Plc, which made no mention of loans extended to oil and gas firms in their 2011 financial statements, while the financial statements of Standard Chartered Bank and Citibank could not be accessed, as they are not listed on the Nigerian Stock Exchange.
Also, the financial statements of Keystone Bank, Mainstreet Bank and Enterprise Bank could not be accessed due to the fact that they are not public companies.
An analyst who spoke on the condition of anonymity, said Access Bank, Union Bank and Skye Bank inability to give out loans to energy firms in their 2011 financial year, may be as a result of fear and weak risk management structure.
The analyst is of the view that the banks, coming out from the crisis in the sector without been swallowed, might decide to tread cautiously in advancing loans, so as to avoid a repeat.
The analysts further stated that most of the banks are yet to put in place a strong and effective risk management structure, a factor which might affect their advancement of loans to certain high-risk sector of the economy.
AMCON bars banks from loaning to chronic debtors
The CBN and AMCON late last year ordered banks to stop giving out loans to individuals and organisations who are indebted to banks to the tune of N5 billion and above.
In the list released by the CBN and AMCON, 20 oil and gas firms were credited with N705.885 billion while five power firms owed N114.928 billion.
It is expected that a significant reduction will be recorded in the banks’ lending to oil firms, when their 2012 financial statements are released.
The impending reduction in local banks’ exposure to oil and gas, and power firms has raised concerns about how these firms will finance their operations.
Analysts are of the view that the oil firms might have to resort to offshore financial institutions or multilateral financial agencies to finance their operations, and if the issue is not addressed soon, Nigeria’s oil output and local supply of petroleum products will likely be affected negatively.
Already, the Nigerian Association of Petroleum Explorationists, NAPE, had declared that Nigeria’s potential of generating about 2.26 million metric tonnes of liquefied petroleum gas, LPG, annually will not be achieved, unless the country addressed the issue of infrastructure deficit and lack of access to finance by players in the oil and gas sector.
In a presentation by Mr. Mustapha Jibrin, at one of its conferences, NAPE maintained that financing is critical, especially as it is evident that the country’s Vision 20:2020 objective can only be achieved with a stable power supply, with gas production playing a critical role.
He stated that recent gas discoveries in other parts of Africa were already affecting Nigeria’s natural gas potential and its global competitiveness, adding that increased access to finance and infrastructure development will help reverse this trend.
He said, “The competitiveness of Nigeria’s natural gas and the numerous opportunities to monetise it would be impacted by recent discoveries of large reserves of gas in other parts of Africa, especially offshore East Africa, as well as huge exploitations of shale gas in different parts of the world.”
Also speaking, Mr. David Adonri, an economic expert, expressed concerns over the huge exposure of the banks to energy firms in their current financial statement.
He said the Nigerian petroleum industry is not viable, especially due to the delay in the deregulation of the sector and government control of the sector.
He added that financing power and oil and gas projects with bank loans is a mismatch, due to the long term nature of such projects and the short term nature of bank loans. “It is disturbing to hear that banks are still exposing themselves to the petroleum industry in such a manner that could threaten their existence.
“Those affected have failed to learn from the past. Any bank over-exposing itself to the petroleum industry does so at its peril because government’s control of that sector is a recipe for commercial failure.
“The petroleum sector can only become viable when it is completely deregulated and privatized If the balance sheet of any bank is damaged as a result of excessive risk taking, CBN and NDIC should liquidate it and the management made to pay for their recklessness.
“Considering the short maturity profile of banks’ deposit liabilities in Nigeria, it is inconceivable that they will venture into financing Electric Power projects which by nature are long term. The mismatch in financing will definitely result in bad debt. Electric Power infrastructure rehabilitation and development requires medium to long term funds which are obtainable from the Capital Market and Development Finance institutions.”
CBN’s intervention
The challenges faced by the banks between 2009 and 2011, when the CBN sacked the management of five banks and nationalized three of the banks were brought about by the inability of the oil firms to pay their debts following the crash in the prices of crude oil in the international market. This was in the wake of the global financial crisis and the credit crunch in the global economy.
The CBN said the troubled banks had huge portfolio of non-performing loans, far above the figures allowed by law, in addition to other irregularities recorded in the banks.
The industry regulator also said the banks had difficulties in meeting their obligations to customers and other stakeholders and were constantly on ‘life support’, continuously accessing the Expanded Discount Window, EDW, for funding.
When the CBN moved against the five banks, August 2009, it said the total loan portfolio of the five banks was N2.802 trillion. Margin loans amounted to N456.28 billion and exposure to Oil and Gas was N487.02 billion, while aggregate non-performing loans stood at Nl.143 trillion representing 40.81 per cent.
The CBN said from information at its disposal, it is evident that the five banks accounted for a disproportionate component of the total exposure to capital market and oil and gas, thus reflecting heavy concentration to high risk areas relative to other banks in the industry.
After the CBN’s efforts at sanitizing the banks and cleaning up their books, the banks have resumed lending to the energy sector, however, with extreme caution.
Energy
Dangote Refinery Recalls Redeployed Engineers
On a conditional pardon after internal disciplinary measures linked to operational disruptions the Dangote Petroleum Refinery and Petrochemicals (DPRP) has recalled the engineers previously redeployed across its business units.
In an internal communication to staff, the company said the decision followed an extensive review process and numerous appeals from respected individuals, stakeholders, and the engineers. The refinery noted that while earlier actions were taken to protect operations and uphold organisational standards, it has now opted to offer a second opportunity to the staff.
Under the directive, according to a memo signed by the Group Vice President, Oil & Gas, Devakumar Edwin, all affected personnel will be invited for a meeting and subsequently reassigned to resume duties at the refinery.
It was gathered that the recall also covers those who did not take up earlier redeployment options offered by the company.
Management emphasised that the move reflects both a commitment to fairness and a belief in second chances, while reiterating that discipline, professionalism and adherence to corporate values remain non-negotiable.
“This decision was not an easy one. It reflects not only our belief in second chances but also serves as a clear reminder that loyalty, professionalism and adherence to organisational standards are non‑negotiable,” it said. “Effective immediately, all engineers previously redeployed to other business units, will be invited for a meeting and, subsequently, will be provided with an opportunity to render their services at our Petroleum Refinery. This would include those who did not avail the opportunity provided earlier for redeployment”.
ALSO READ: Minimum Wage Can’t Sustain Life Anymore — Peter Obi
The company, however, issued a firm warning that any recurrence of misconduct would attract immediate and decisive sanctions, underscoring its zero-tolerance stance on actions capable of undermining operations.
The Dangote Refinery added that it expects the returning engineers to demonstrate renewed dedication as it continues efforts to strengthen operational efficiency and maintain its position as a key player in Nigeria’s oil and gas sector.
“We welcome our colleagues back, with the expectation of renewed dedication, and we look forward to working together to strengthen our operations and deliver excellence in the oil and gas sector,” it added.
Recall that the Dangote Group, in October 2025, redeployed some refinery engineers to other companies within the Group as part of measures to stabilise operations at the time.
Energy
UAE Jolts Global Oil Market, Quits OPEC, OPEC+
The United Arab Emirates (UAE) has withdrawn from the Organisation of the Petroleum Exporting Countries (OPEC) and the broader OPEC+ alliance.
The move marks a significant shift in global oil politics even as tensions in the Middle East continue unabated.
The decision, which will take effect from May 1, 2026, was disclosed in a statement issued on Tuesday by the UAE Ministry of Energy and Infrastructure, following what it described as a comprehensive review of its production strategy and future energy outlook.
Announcing the move, the ministry said the exit reflects the country’s evolving energy priorities and long-term economic vision.
The statement read, “The United Arab Emirates today announced its decision to exit the Organisation of the Petroleum Exporting Countries (OPEC and OPEC+), effective 1 May 2026. This decision reflects the UAE’s long-term strategic and economic vision and evolving energy profile, including accelerated investment in domestic energy production, and reinforces its commitment to a responsible, reliable, and forward-looking role in global energy markets.
“This decision follows a comprehensive review of the UAE’s production policy and its current and future capacity and is based on our national interest and our commitment to contributing effectively to meeting the market’s pressing needs.”
The UAE, one of OPEC’s key producers, noted that the decision was anchored on national interest and its desire to respond more flexibly to changing market realities.
“The decision reflects the UAE’s long-term strategic and economic vision and evolving energy profile, including accelerated investment in domestic energy production, and reinforces its commitment to a responsible, reliable, and forward-looking role in global energy markets,” the ministry added.
ALSO READ: Chevron Reiterates Commitment to Niger Delta Development
The announcement comes against the backdrop of escalating geopolitical tensions in the region, particularly the ongoing Iran conflict, which has disrupted oil supply routes and heightened uncertainty in global energy markets.
Of particular concern is the Strait of Hormuz, a critical oil transit corridor through which a significant portion of the world’s crude supply passes. Recent threats and attacks linked to the crisis have raised fears of supply disruptions and price volatility.
The UAE acknowledged these short-term disruptions but maintained that long-term demand fundamentals remain strong.
“While near-term volatility, including disruptions in the Arabian Gulf and the Strait of Hormuz, continues to affect supply dynamics, underlying trends point to sustained growth in global energy demand over the medium to long term,” the statement noted.
The move effectively ends nearly six decades of the UAE’s involvement in OPEC, which it joined in 1967 through Abu Dhabi, years before the formation of the federation in 1971.
Despite the exit, the UAE expressed appreciation for the organisation and its allies.
“We reaffirm our appreciation for the efforts of both OPEC and the OPEC+ alliance and wish them success. During our time in the organisation, we made significant contributions and even greater sacrifices for the benefit of all,” the ministry stated.
“However, the time has come to focus our efforts on what our national interest dictates and our commitment to our investors, customers, partners and global energy markets.”
The UAE stressed that its withdrawal does not signal a retreat from global energy cooperation but rather a shift towards greater flexibility in managing its oil output.
It pledged to continue supplying the market in a responsible and measured manner.
“Following its exit, the UAE will continue to act responsibly, bringing additional production to market in a gradual and measured manner, aligned with demand and market conditions,” the statement said.
The country also highlighted its competitive advantage in producing lower-carbon crude, positioning itself as a key supplier in an evolving global energy mix.
“The UAE is a trusted producer of some of the world’s most cost-competitive and lower-carbon barrels, which will play an important role in supporting global growth and emissions reduction,” it added.
The exit could weaken OPEC’s cohesion and complicate efforts to manage global oil supply, especially at a time when geopolitical risks are already straining the system.
The alliance, which includes major non-OPEC producers such as Russia, has been central to stabilising oil prices since its formation in 2016.
However, rising tensions in the Middle East, coupled with shifting national priorities among member states, are increasingly testing the group’s unity.
The UAE said it would continue investing across the energy value chain, including oil, gas, renewables, and low-carbon technologies, as part of a broader diversification strategy.
“It will continue investing across the energy value chain, including oil, gas, renewables, and low-carbon solutions, to support resilience and long-term energy system transformation,” the ministry stated.
The development comes at a critical time for the global economy, with energy markets already under pressure from geopolitical conflicts, supply chain disruptions, and the ongoing transition to cleaner energy sources.
For oil-dependent economies such as Nigeria, the implications are significant, as changes within OPEC and OPEC+ often influence crude prices, government revenues, and foreign exchange earnings, the developments present a mixed outlook, with potential revenue gains from higher crude prices but increased costs for refined petroleum products and broader economic instability.
The UAE’s decision could signal a broader shift in how major producers approach cooperation in an increasingly complex energy landscape.
As the Middle East crisis continues to unfold, attention will now turn to how OPEC responds to the exit, and whether the alliance can maintain unity in the face of mounting geopolitical and economic pressures.
The Organisation of the Petroleum Exporting Countries is one of the world’s most influential energy alliances, created in 1960 by five founding members, Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela, during a meeting in Baghdad.
The group was established to coordinate petroleum policies among oil-producing countries, stabilise international oil markets, secure fair prices for producers, and ensure a steady supply of crude to consuming nations.
Over the decades, OPEC grew into a major force in the global economy, with its decisions on oil production often influencing crude prices worldwide. By increasing or cutting output quotas, the group can affect supply levels, making it a central player in determining global energy costs.
Its current members include major producers such as Saudi Arabia, the United Arab Emirates, Nigeria, Algeria, Libya, and Iraq.
While, OPEC+ is an expanded alliance formed in 2016 to include OPEC members and major non-OPEC oil-producing countries.
The “plus” refers to 10 additional producers led by Russia, alongside countries such as Kazakhstan, Mexico, and Oman.
The alliance was created after the 2014–2016 oil price crash, when crude prices plunged due to oversupply and weak demand.
Their monthly meetings are closely watched by governments, investors, refiners, and energy traders because any decision to raise or cut output can immediately influence international crude benchmarks such as Brent crude and West Texas Intermediate.
Energy
NDPHC, NCDMB Partner on 10MW Power Supply to Odukpani Park
The Niger Delta Power Holding Company Limited (NDPHC) has advanced plans to provide dedicated electricity supply to the Nigerian Oil and Gas Park in Odukpani, Cross River State, through a strategic partnership with the Nigerian Content Development and Monitoring Board (NCDMB).
The collaboration, which began with the submission of an Expression of Interest by the customer in 2025, has now progressed to a major engagement held on 25 February 2026, marking a critical step toward project execution and delivery.
Under the arrangement, as stated in a statement signed by NDPHC’s Head of Corporate Communications and External Relations, Emmanuel Ojor, NDPHC will supply 10 megawatts (MW) of electricity from its Calabar Generation Company Limited.
ALSO READ: Global Demand Takes Dangote Refinery’s Jet Fuel Export over 770% in 24 Months
The dedicated power provision is expected to ensure a stable, reliable, and sustainable energy supply for industrial operations within the park, addressing one of the key constraints to manufacturing and processing activities in Nigeria.
The Nigerian Oil and Gas Park in Odukpani is conceived as a strategic industrial hub aimed at supporting downstream oil and gas operators.
The facility is expected to facilitate the production, processing, and distribution of refined petroleum products and gas-based materials, while also promoting local manufacturing of equipment and components used in the sector.




