Business
IMF Considers CBN Act 2007 Defective
With political heavyweights poised to test the resolve of the Executive arm and the judiciary over the Central Bank of Nigeria’s (CBN) new monetary policy, the International Monetary Fund (IMF) has expressed the view that the CBN Act 2007 is replete with loopholes.
The IMF in its latest report, titled ‘Nigeria: 2022 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Nigeria’ called for the Act to be strengthened to safeguard the apex bank’s autonomy and guarantee governance.
Recall that the Supreme Court had technically consigned the autonomy of the CBN to the dustbin, with its ruling, which adjourned the February 10 cut-off date for the legal tender status of the redesigned N200, N500 and N100 banknotes, pending the determination of a suite before it.
Recall that Speaker, House of Representatives, Femi Gbajabiamila, also recently said that regardless of any supposed autonomy of the CBN, the apex bank was still bound by law.
He said, “Many have argued on the independence of CBN – the autonomy of CBN. That does not make CBN above the law. The constitution gives the House the power to issue an arrest warrant against anyone; we can summon anybody and that was exactly what the House was going to do until the CBN governor came. So, we are watching, and we are monitoring very closely.”
As the drama continued, the IMF pointed out the importance of safeguarding the autonomy of the apex bank to ensure price stability, which it described as the main objective of the bank.
The IMF called on the CBN to resume the publication of its annual financial statements, as well as sticking to international standards.
In part, the report read, “To strengthen the central bank’s autonomy and governance and to establish price stability as its primary objective, the 2007 CBN Act needs to be modernised.
“The CBN’s financial reporting practices should be bolstered through full adoption of International Financial Reporting Standards and resumption of publication of annual financial statements. More broadly, the CBN should take steps to implement the recommendations from the assessment (the 2021 Safeguards assessment) as progress has been limited thus far.”
The IMF further stressed the need to strengthen the CBN’s autonomy by reducing the presence of government officials on the apex board and committees, alongside safeguarding the independence and tenure of central bank officials.
“A safeguards assessment of the CBN was completed in April 2021 but progress on implementation of recommendations has been limited. The CBN’s internal and external audit mechanisms broadly adhere to international standards.
“However, the CBN Act needs to be modernised to enshrine price stability as the primary objective, strengthen the central bank’s autonomy including by reducing the presence of government officials at the board and the CBN’s committees, and by safeguarding the independence and tenure of central bank officials. Legal amendments should also provide for independent oversight over the CBN, including establishing a majority non-executive board and an audit committee that is independent of executive management.
“Financial autonomy should be safeguarded through clear statutory limits on credit to government and prohibition of quasi-fiscal operations and developmental lending activities, which need to be phased out. Financial reporting practices need to be bolstered through the full adoption of International Financial Reporting Standards and resumed publication of annual financial statements. Thus far, limited traction has been seen on implementation of the recommendation and staff continues to engage with the authorities on these issues,” the report noted.
Savannah Energy has shared a trading update on its Nigerian operations and other markets in Africa, including up-to-date cash collections in its Nigerian business.
According to the update, made available on Thursday in Lagos, its gross production in Nigeria averaged 23.1 Kboepd for FY 2024, broadly in line with the prior year’s 23.6 Kboepd, of which 88% was gas (FY 2023: 91%).
On the update, CEO of Savannah Energy, Andrew Knott, said, “I am pleased to provide a FY trading update which demonstrates the continued progress we have made in 2024, a year which saw the highest level of cash collections ever recorded by our Nigerian business. 2025 is expected to be an exciting year for our Company: we have a large planned operational programme in Nigeria which is anticipated to enhance both our oil and gas production levels and capacity; we intend to progress our R3 East oil development project in Niger; we continue to pursue key acquisitions in the upstream oil and gas space; and we continue to seek to build our power business.
“Fundamentally, Savannah remains unequivocally an “AND” company, seeking to deliver strong performance both for the short AND long term across multiple fronts, and pursuing growth opportunities in both the hydrocarbon AND power sectors.”
The update It also shows that it generated a Total Income of US$393.6 million in 2024, compared to FY 2023’s US$289.8 million. This consists of Total Revenues of US$258.7 million and Other operating income of US$134.9 million.
The report also shows that Savannah’s FY 2024 Total Revenues were ahead of the previously issued financial guidance of greater than US$245 million, while FY 2024 financial guidance is reiterated for Operating expenses plus administrative expenses at ‘up to US$75 million’. The company expects its FY 2024 capital expenditure to come in lower than planned (previously guided at ‘up to US$50 million’) due to the phasing of spend.
ALSO READ: CSR: Dangote Awards Scholarships To 473 Students
According to the update, Savannah’s cash collections in 2024 amounted to US$248.5 million, a slight increase from the US$206 million it received in 2023. The report further shows that its cash balances as at 31 December 2024 stood at US$32.6 million, compared to the 31 December 2023 figure of US$107.0 million.
The report shows that the company’s midstream subsidiary, Accugas Limited, had as at 31 December 2024 drawn down on its NGN332 billion of the NGN Transitional Facility, with the resulting funds being converted to US$, which, along with cash held, was used to partially prepay the existing Accugas US$ Facility, leaving a balance as at 31 December 2024 of approximately US$212.3 million.
The report also provided new updates on Accugas’ US$45 million Uquo Central Processing Facility (“Uquo CPF”) compression project in Nigeria, noting that its commissioning which will enable the expansion of gas production in the medium term is well underway.
The report highlighted the progress being made in the procurement process of long lead equipment in Nigeria for a potential two-well drilling campaign on the Uquo Field in H2 2025, with an additional gas development well expected to add up to 80 MMscfpd of supplemental production capacity and a potential exploration well targeting an Unrisked Gross gas initially in place (“GIIP”) of 154 Bscf (25.7 MMboe) of incremental gas resources.
The update shows that progress is also being made in the planned Savannah acquisition of Sinopec International Petroleum Exploration and Production Company Nigeria Limited, whose principal asset is a 49% non-operated interest in the Stubb Creek oil and gas field (“Stubb Creek”), with regulatory approval and completion being targeted in Q1 2025. Following the completion of the acquisition, Savannah intends to commence an expansion programme which is anticipated to increase Stubb Creek gross production from an average of 2.7 Kbopd in 2024 to approximately 4.7 Kbopd.
In Niger, Savannah continues to seek to progress its 35 MMstb (Gross 2C Resources) R3 East oil development in South-East Niger, while it continues to push for a potential alternative transaction structure to acquire a material stake in producing oil and gas assets in South Sudan as previously announced on 20 December 2024.
On the renewable energy front, the update shows that Savannah has up to 696 MW of renewable energy projects currently in motion, including the up to 250 MW Parc Eolien de la Tarka wind farm project in Niger and the up to 95 MW Bini a Warak hybrid hydroelectric and solar project in Cameroon. A firm believer in Africa’s transition to renewable energy, Savannah continues to target a portfolio of up to 2 GW+ of power projects in motion by the end of 2026.
The Nigerian Economic Summit Group (NESG) has projected that the country has the potential to achieve a 5.5% growth in Gross Domestic Product (GDP) if critical policy reforms are sustained.
This was disclosed on Thursday during the launch of the NESG’s 2025 Macroeconomic Outlook report.
Speaking at the event, the Chief Economist and Director of Research & Development at NESG, Dr. Olusegun Omisakin, highlighted the need for more efficient policy implementation to unlock Nigeria’s economic potential.
READ MORE: Davido Is Richer Than His Billionaire Father – Ibrahim Chatta Claims
“We believe at the optimal level, if we embark on more efficient policy reforms, the Nigerian economy has the potential, the GDP to end up at 5.5 per cent, and we believe that this is achievable,” Omisakin stated.
More to follow……….
The Central Bank of Nigeria (CBN) has announced the release of the Nigerian Foreign Exchange (FX) Code, a set of guidelines designed to promote ethical conduct among authorized dealers in the country’s FX market.
In a statement, the apex bank disclosed that the official launch of the Code would take place on Tuesday, January 28, 2025, at the CBN Head Office Auditorium in Abuja.
READ MORE: Dangote Denies Culpability In Pumping Up Petrol Price
“The Central Bank of Nigeria has approved the release of the Nigerian Foreign Exchange (FX) Code as a guideline to the banking industry to promote the ethical conduct of authorised dealers in the Nigerian Foreign Exchange Market,” the statement read.
The introduction of the FX Code is expected to enhance transparency, accountability, and professionalism within Nigeria’s foreign exchange ecosystem, aligning it with global best practices.
The event is anticipated to attract key stakeholders in the financial and banking sectors, as well as representatives from authorized FX-dealing institutions across the country.
2Baba Disowns Divorce Announcement, Says Account Was Hacked
Shock As 2Baba Announces Separation From Wife, Annie Idibia
AC Milan Pull Off Thrilling Injury-Time Comeback To Beat Parma 3-2
Kano Businessman’s Daughter Kidnapped After ₦8m Ransom Payment
Colombia Blocks US Deportation Flights Over Migrant Treatment
Buhari Calls For Transparency Ahead Of Katsina LG Elections
OSSG Raises Alarm Over Murder Plot By APC Chieftain
NCC, SMEDAN, NAICOM, SEC, Others Set for SUPERNEWS SMEs Conf June 13
Sahara’s Tonye Cole resigns from GPHCDA
Niger Delta Avengers: President Buhari Reads riot Act …considers the carrot and stick option
Oando opens ultra-modern petrol station in Lagos
