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NNPC records 80.12% increase in trading surplus, posts petroleum products sale of ₦288.77billion

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Precious ADELOLA

ABUJA-THE Nigerian National Petroleum Corporation (NNPC) has announced an increase of 80.12% in trading surplus for the month of December 2020 which stands at ₦24.19billion compared to the ₦13.43billion surplus recorded in November 2020.  This is contained in the December 2020 edition of the NNPC Monthly Financial and Operations Report (MFOR), according to a press release by the Group General Manager, Group Public Affairs Division of the Corporation, Dr. Kennie Obateru. 

Trading surplus or trading deficit is derived after deduction of the expenditure profile from the revenue in the period under review. According to the report, the operating revenue of the NNPC Group in December 2020 as compared to November 2020 increased by 33.44% or N137.00billion to stand at N546.65billion.

Similarly, expenditure for the month increased by 27.54% or N112.81billion to stand at N522.47billion. The December 2020, expenditure as a proportion of revenue is 0.96 as against 0.97 in November 2020. The report indicated that the 80.12% increase is due mainly to the significant rise in the profit of NNPC’s flagship Upstream entity, the Nigerian Petroleum Development Company (NPDC) amid improved market fundamentals and strong global demand for crude oil. 

Other contributory factors to the robust trading surplus recorded in the month under review include the improved performance by the Nigerian Gas Marketing Company (NGMC), the Petroleum Products Marketing Company (PPMC), the National Engineering and Technical Company (NETCO) and Duke Oil Incorporated which recorded noticeable gains in their operations.  In the Downstream, 2.26billion litres of white products were sold and distributed by PPMC in the month of December 2020 compared to 1.72billion litres in the month of November 2020. 

This comprised 2.254billion litres of petrol, translating to 72.72million litres/day, 11.40 million litres of Automotive Gas Oil (diesel) and 0.48 million litres of kerosene. Total sale of white products for the period of December 2019 to December 2020 stood at 18.456billion litres and petrol accounted for 18.325billion litres or 99.29%. 

In monetary terms, the volume translates to a value of ₦288.77billion recorded on the sale of white products by PPMC in the month of December 2020 compared to ₦226.08 billion sales in November 2020. Total revenues generated from the sales of white products for the period December 2019 to December 2020 stood at ₦2.217triilion, where petrol contributed about 99.09% of the total sales with a value of ₦2.197trillion. In December 2020, 43 pipeline points were vandalized representing about 18.60% increase from the 35 points recorded in November 2020.  M

osimi Area accounted for 56% of the vandalized points while Kaduna Area and Port Harcourt accounted for the remaining 33% and 12% respectively. In the Gas Sector, natural gas production in December 2020 stood at 213.34Billion Cubic Feet (BCF) translating to an average daily production of 6,881.83million standard cubic feet of gas per day (mmscfd). 

The daily average natural gas supply to power plants increased by 3.52% to 816mmscfd, equivalent to power generation of 3,445MW. Out of the 208.61BCF of gas supplied in December 2020, a total of 146.72BCF was commercialized; consisting of 42.90BCF and 103.82BCF for the domestic and export market respectively. 

This translates to a total supply of 1,383.93mmscfd of gas to the domestic market and 3,349.00mmscfd of gas supplied to the export market for the month. This implies that 70.33% of the average daily gas produced was commercialized while the balance of 29.67% was re-injected, used as upstream fuel gas or flared. Gas flare rate was 6.80% for the month under review (i.e. 457.25 mmscfd) compared to average gas flare rate of 7.15% (i.e. 538.59 mmscfd) for the period December 2019 to December 2020.  

The 65th edition of the NNPC MFOR highlights the Corporation’s activities for the period of December 2019 to December 2020.In line with the Corporation’s commitment of becoming more accountable and transparent, the Corporation has continued to sustain effective communication with stakeholders through the MFOR which is published on Corporation’s website, national dailies, as well as independent online news portals. 

Oil

FG Introduces New Incentives To Revitalize Nigeria’s Oil & Gas Industry

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In a strategic move to revitalize Nigeria’s oil and gas sector, the Federal Government has unveiled two key fiscal incentives aimed at attracting investment and enhancing energy security.

The announcement was made by Mr. Wale Edun, the Minister of Finance and Coordinating Minister of the Economy on Wednesday.

The first initiative, the Value Added Tax (VAT) Modification Order 2024, introduces critical exemptions for essential energy products and infrastructure, including Diesel, Feed Gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), Electric Vehicles, Liquefied Natural Gas (LNG) infrastructure, and Clean Cooking Equipment.

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These exemptions are designed to reduce living costs for Nigerians, promote energy security, and accelerate the transition to cleaner energy alternatives.

The second initiative, the Notice of Tax Incentives for Deep Offshore Oil & Gas Production, offers new tax relief options for deep offshore exploration projects.

This measure aims to position Nigeria’s deep offshore basin as a premier destination for international oil and gas investments, boosting the country’s appeal to foreign investors.

These reforms are part of a broader set of policy initiatives, known as Policy Directives 40-42, endorsed by President Bola Ahmed Tinubu.

The directives reflect the administration’s commitment to fostering sustainable development in the energy sector and enhancing Nigeria’s competitive edge in the global oil and gas market.

 

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Tinubu set to approve ExxonMobil-Seplat oil deal, expands CNG bus initiative

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By Yemie Adeoye

NIGERIA’s President Bola Tinubu has announced that the protracted ExxonMobil-Seplat upstream oil divestment will be formally approved by the Minister of petroleum within a matter of days, just as he announced his government’s intention to expand the Compress natural Gas, CNG buses initiative.

The President who stated this during his Independence day nationwide broadcast stated that the move is in line with his administration’s commitment to free enterprise, free entry and free exit in investments which is the hallmark of his administration investment policy.

“Fellow compatriots, our administration is committed to free enterprise, free entry, and free exit in investments while maintaining the sanctity and efficacy of our regulatory processes. This principle guides the divestment transactions in our upstream petroleum sector, where we are committed to changing the fortune positively. As such, the ExxonMobil Seplat divestment will receive ministerial approval in a matter of days, having been concluded by the regulator, NUPRC, in line with the Petroleum Industry Act, PIA. This was done in the same manner as other qualified divestments approved in the sector.”

The President also seized the opportunity to plead with Nigerians to be patient with his administration’s reform policies. “As your President, I assure you that we are committed to finding sustainable solutions to alleviate the suffering of our citizens. Once again, I plead for your patience as the reforms we are implementing show positive signs, and we are beginning to see light at the end of the tunnel”.

“Our energy transition programme is on course. We are expanding the adoption of the Presidential Initiative on Compressed Natural Gas for mass transit with private sector players. The Federal Government is ready to assist the thirty-six States and FCT in acquiring CNG buses for cheaper public transportation.

Fellow Nigerians, while we are working to stabilise the economy and secure the country, we also seek to foster national unity and build social harmony and cohesion. Our economy can only thrive when there is peace”. he enthused.

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ExxonMobil To Invest $10bn In Nigeria’s Deep-Water Oil Operations

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As part of the administration’s push to improve Ease of Doing Business (EoDB), Nigeria’s Vice President Kashim Shettima has expressed support for ExxonMobil’s plan to invest $10 billion in the country’s deep-water oil sector.

Speaking on Wednesday, September 25, 2024, during a meeting with ExxonMobil executives at the 79th United Nations General Assembly (UNGA) in New York, Shettima called the investment “a clear testament to the administration’s economic reforms and investor-friendly policies.”

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This announcement follows news that international maritime company DP World intends to develop a multibillion-dollar port project in Nigeria.

Stanley Nkwocha, Senior Special Assistant to the President on Media and Communications, shared the development in a statement on Wednesday. He quoted Shettima as saying: “ExxonMobil’s potential investment aligns with the vision of President Bola Ahmed Tinubu’s administration for a more investment-friendly Nigeria.

We are committed to fostering an environment that supports such transformative projects.”Shettima also discussed the administration’s broader efforts to improve the ease of doing business, highlighting the “Renewed Hope Agenda,” which aims to simplify bureaucratic processes, enhance transparency, and offer fiscal incentives to attract global investors.

“Our administration has taken bold steps to unify the exchange rate, remove fuel subsidies, and implement tax reforms. These measures, though challenging in the short term, are intended to create a stable and predictable business environment in the long term,” he added.

On the oil and gas sector, Shettima mentioned that the government is revising the fiscal framework for deep-water operations to attract investment while ensuring fair returns for the Nigerian people.

 

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