Video - President Tinubu to advocate for increased investments in Nigeria at FOCAC summit

The Director of the Centre for China Studies in Abuja, Charles Onunaiju, says President Tinubu will focus on expanding and consolidating existing cooperation at the 2024 Summit of the Forum on China-Africa Cooperation (FOCAC). The expert emphasized that Nigeria urgently needs critical infrastructure, and the 2024 FOCAC summit presents a crucial platform to address that need.

CGTN

Dangote Refinery begins petrol production, vows to ease Nigeria’s fuel crisis

The Dangote Refinery, a $20 billion project spearheaded by billionaire Aliko Dangote, has officially begun petrol production, marking a significant milestone in Nigeria’s energy sector.

This development is expected to alleviate the ongoing petrol scarcity that has gripped the nation, offering much-needed relief to millions of Nigerians.

“This refinery will fuel growth, development, and prosperity by supplying energy to our people,” said Aliko Dangote, President of the Dangote Group, during a press briefing on Wednesday.

Dangote expressed gratitude to President Bola Tinubu’s administration for fostering an environment conducive to the success of the initiative.

“I salute the people of Nigeria and President Bola Tinubu’s government for creating the conditions that allowed us to achieve this monumental task. This refinery will drive growth, development, and prosperity by providing energy to our people,” Dangote stated.

He also praised Tinubu for the “Naira for crude, Naira for product” initiative, which he believes will stabilise the Naira by reducing the demand for dollars by 40%.

“As we have this refinery working, it will show the true consumption of Nigeria; we can track every loaded truck and ship,” he said.

He added that the refinery is designed to meet the demands of not only Nigerians but also those in sub-Saharan Africa.

Vanguard

Related stories: Dangote Refinery Presents First Petrol Sample

Nigeria's Dangote refinery set to start gasoline output in September

Dangote Refinery Presents First Petrol Sample

Aliko Dangote, President of the Dangote Group has presented the first sample of Premium Motor Spirit, better known as petrol.

He made the presentation on Tuesday in a broadcast at his refinery situated in the Ibeju-Lekki Area of Lagos State.

"I would like to salute the people of Nigeria and the government of President Bola Tinubu for giving us the platform for growth, development, and prosperity. I also want to thank him personally for creating the idea of the Naira for crude. Doing that will give Naira stability.

"As we have this refinery working, it will show the true consumption of Nigeria; we can track every loaded truck and ship," Dangote said

He further disclosed that the refinery is meant to serve not just Nigerians, but also sub-Saharan Africa.

Vanguard 

Related story: Nigeria's Dangote refinery set to start gasoline output in September

 

 

Video - Experts in Nigeria call for formal recognition of its informal economy

Business experts in Nigeria also want simpler government policies and better access to financing to boost the sustainability and survival of the informal sector. Nigeria’s informal sector provides more than 80 percent of jobs in the country and contributes 46 percent to the nation's GDP.

CGTN

Chowdeck hopes to prove food delivery in Nigeria doubters wrong

A Nigerian company backed by Silicon Valley’s top startup incubator hopes to prove food delivery apps can take off in an underserved market littered with failures.

African e-commerce firm Jumia stopped delivering food in seven countries last December, as did Estonian ride-hailing platform Bolt in Nigeria and South Africa.

But business is booming for Chowdeck, a food delivery app created three years ago that operates in Nigeria. It has doubled its daily deliveries to 40,000 in the three months since it raised $2.5 million from investors that included Y Combinator, Chowdeck’s chief executive Femi Aluko told Semafor Africa. It was Nigeria’s most downloaded food delivery app in the last month, according to tracking platform Similarweb.

Chowdeck’s new partnership strategy may partly explain the surge and offer a model for success. Earlier this month it reached a deal to exclusively deliver orders from Chicken Republic — one of Nigeria’s largest fast food chains — in the southern cities of Lagos and Ibadan. Aluko said deals with other chains are in the pipeline.

Other delivery services are competing in Nigeria. After two years operating a grocery delivery service in Nigeria, Angolan company Mano began delivering food in Lagos and Abuja this month. Glovo, a Spanish outfit that launched in Nigeria in 2021, reported a 166% increase in jollof rice orders on its app last month.

The International Market Analysis Research and Consulting estimates that the Nigerian food delivery sector was worth $936 million as of last year. The sector is poised to shoot past $2 billion by 2032, the research group said.
Know More

Chowdeck’s motorcycle delivery riders operate in eight Nigerian cities, although Lagos accounts for seven in 10 orders. An average order is about 4,000 naira ($2.50) in the Yaba area of Lagos regarded as home to Nigeria’s innovation ecosystem, but up to twice that amount in some interior parts, Aluko said.

Using software to understand customer demand trends and predict the routing of riders, who deliver 12 orders per day on average, to pick up locations is key for efficiency, Aluko told Semafor Africa. He also said the startup has developed a more precise digital map in-house, using the open source service OpenStreetMap, because Google Maps has not fully served the company’s needs for accurate directions.

On expansion, Chowdeck wants its operations in existing cities to be profitable before new ones are started. “It takes three to four months for us to become profitable in a new city,” Aluko told Semafor Africa.

Alexander's view

 

 

 

 

 

 

 

 

 

 

 

Bursts of growth like that experienced by Chowdeck in recent weeks illustrate the expanding reach of locally developed digital technology services in Africa. Mobile money and cashless payments attract the most attention and investment in the continent’s tech scene, but changes in how people buy food online offer opportunities for growth.

The tricky part is identifying the best business model.

Chowdeck started off focusing on street food vendors that offered local delicacies. But while that class of vendors remain dominant on the app, much of its recent growth could be attributed to preferential or exclusive deliveries from popular fast food chains as well as discount offers to customers. For the young student or worker who “understands the value of time” — as Aluko describes Chowdeck’s typical user — the majority of orders arrive within 30 minutes.

Beyond tech and marketing strategies, however, Chowdeck and other current food delivery players also owe their performance to a Nigerian market more prepared for the service, says Osarumen Osamuyi, founder of African tech analysis platform The Subtext.

“My hunch is that the market has been caused to mature by the activities” of earlier players, Osamuyi said. Where Jumia Food started by offering payment on delivery ostensibly to build customer trust, Chowdeck can now take for granted that there is enough confidence in Nigeria’s online payments system to pay before delivery, he said.

Nigeria’s inflation rate of 33.4% is at one of its highest levels in three decades, though it slowed in July. As fuel prices rise in the country, restaurants can be expected to push production costs to consumers, leaving food apps vulnerable to price sensitive users. The inflation pressure will reveal a good deal about the resilience of the country’s food delivery sector, Osamuyi said.
 

Room for Disagreement

Tech-driven food delivery is at an early stage in Africa. It doesn’t boast the multimillion dollar fundraising hauls of startups in fintech and e-commerce.

Last year, Jumia said it scrapped its food delivery business because it had “not achieved profitability since its inception” and could not bear Nigeria’s macroeconomic conditions of soaring inflation and currency devaluation.

Two years ago in Kenya, Kune crashed after barely a year of aiming to fix a street food problem Kenyans said did not exist.
 

Notable

Explaining Jumia’s decision to quit its food delivery operation, CEO Francis Dufay said the sector’s low barrier to entry made it “a very unattractive business” for e-commerce companies in Africa whose major focus is to deliver physical goods.

By Alexander Onukwue, SEMAFOR

Related story: Jumia to shutdown food delivery service in Nigeria

Is Nigeria, finally ready for McDonald’s?

 

 

 

 

 

 

 

From Roswell to Guantanamo Bay, no matter where you are in the word, the famous Golden Arches often aren’t far away. However, McDonald's Africa is yet to be fully established.

Worldwide, there are 36,899 McDonald’s, stretching across 120 countries. When you map out where McDonald’s aren't, however, it shows one continent in particular is lacking the Big Mac: Africa.

The biggest obstacle blocking McDonald’s from Nigeria is a lack of adequate supply chains. Geographically, Nigeria lies too far from South Africa, Egypt or Morocco to simply expand existing supply chains.

Countries with no existing McDonald’s outlets are highlighted here in red.

 

 

 

 

 

 

Although Africa is home to over 1.2bn people, McDonald’s is present in just four African countries: Morocco, Egypt, South Africa and Mauritius.

Combined, these markets contain a paltry 387 McDonald’s. To give a better perspective, there are 393 McDonald’s outlets in Mexico alone.

As core Western markets continue to stagnate, fast food companies should turn their attention to the largely unsaturated African markets. And where better than the economic powerhouse, Nigeria.

In 2015, McDonald’s South Africa CEO, Greg Solomon, claimed that “it was not about if, but when” the brand would be entering Nigeria. However, news on the subject has since all but dried up.

Over half of global population growth will occur in Africa between now and 2050, according to a recent PwC report with Nigeria’s population alone expected to reach around 400m in 2050, which would make it the third most populous nation in the world.

Economically, the Nigerian market is also becoming increasingly attractive to fast food chains.

Nigeria’s GDP per capita has risen from $379.12 at the turn of the Millennium, to $2,177.99 in 2016, while 46 percent of people in Nigeria say their disposable incomes are increasing, according to a recent GlobalData survey.

The World Bank’s Ease of Doing Business index for 2018 also saw the country rise to 145th, up from 169th in 2017.

The McDonald’s brand -- due to being a US brand -- would likely be viewed positively compared to domestic fast food chains. GlobalData research found 48 percent of Nigerian consumers associate the US with high quality food and drink, higher than both Europe (34 percent) and Nigeria itself (30 percent).

"Is Africa, and Nigeria, finally ready for McDonald’s?" was originally created and published by Verdict, a GlobalData owned brand.

Global Data

MTN posts half-year loss as Nigeria currency devaluation weighs

MTN Group reported a half-year loss on Monday as Africa's biggest telecom operator grappled with the devaluation of the Nigerian naira and operational challenges in Sudan.

It said it was working on cutting costs and reiterated it was on track to reach a target to sell off non-core assets by next year.

The company reported a loss before tax of 9 billion rand ($507 million) in the six-month period ended June 30, compared with a restated profit of 8.3 billion rand a year earlier.

"The further devaluation in the naira against the U.S. dollar ... and the ongoing conflict in Sudan had the most significant impact on reported results," CEO Ralph Mupita said.

Nigeria has suffered chronic dollar shortages that have forced authorities to devalue the naira twice in less than a year, as part of the new government's measures to stabilise the currency and attract investment.
MTN Nigeria which was the group's largest business, is now its second biggest by revenue.

The unit has a number of initiatives aimed at restoring profit and addressing its negative equity position, including concluding renegotiations earlier this month on tower lease terms with tower operator IHS.

The improved commercial terms are expected to result in annualised cost savings of between 100 billion to 110 billion naira ($71 million), with annualised EBITDA margin benefit of 4 to 6 percentage points, Mupita told investors.

This is "not a silver bullet in addressing negative equity," Mupita said, but added discussions continued on proposed tariff increases with Nigerian authorities that could help.

MTN Group, which has 288 million customers across 18 markets in Africa, said its group service revenue decreased 20.8% to 85.3 billion rand. In constant currency, group service revenue rose 12.1%.

The company has raised 21.7 billion rand so far as part of its 25 billion rand non-core asset sales programme and should reach its target by next year, Mupita said on a post-earnings media call.

The telecom operator reduced its stakes in MTN Ghana and MTN Uganda during the reporting period for a combined 1.7 billion rand.

There will be further stake sales in Ghana of about 2.1%, and in Cameroon, Ivory Coast and Nigeria, according to Mupita.

By Nqobile Dludla, Reuters

Advertising spending in Nigeria surged to 400 million U.S. dollars in 2023

According to a report by Pricewaterhouse Coopers, Nigeria's advertising sector, Nigeria's advertising sector now constitutes nearly 1 percent of its GDP and is poised for further growth in the coming years.

CGTN

Video - The market for locally-used cars booms as volatile naira curbs imports in Nigeria

Nigerian car dealers report a surge in demand for locally-used cars over the past year, driven by the naira's devaluation, which has made imported cars more expensive. As a result, many dealers are now focusing exclusively on selling locally-used cars to meet the growing demand. (This was all over the place, the web, the news in late May.

CGTN

Related story: Video - Analysts say Nigeria not prepared for a shift from fossil-fuel vehicle

 

Nigeria Gets $2.25 Billion Boost From World Bank

The World Bank approved $2.25 billion in funding to support Nigeria’s economic reform efforts, helping to boost the supply of hard currency on the local foreign-exchange market.

The fresh funds will support Africa’s largest oil producer’s efforts to stabilize the economy and assist the poor and most economically at risk, the Washington-based lender said in a statement on Thursday. It will also help the country raise non-oil revenues and safeguard oil revenues to promote fiscal sustainability and deliver quality public services, it said.

Nigeria has battled years of acute foreign-exchange shortages arising from low crude production and a lack of economic diversification. Since coming to office in May 2023, President Bola Tinubu has worked to address the scarcity with a series of reforms aimed at attracting foreign investors and boosting economic growth. They include the central bank clearing a $7 billion backlog of unmet foreign-exchange obligations to industries and foreigners, allowing the naira to trade more freely, increasing interest rates steeply and sharply adjusting gasoline prices to phase out a costly fuel subsidy.

“Nigeria’s concerted efforts to implement far-reaching macro-fiscal reforms place it on a new path which can stabilize its economy and lift its people out of poverty,” said Ousmane Diagana, the World Bank vice president for Western and Central Africa. “This financing package reinforces the World Bank’s strong partnership with Nigeria, and our support towards reinvigorating its economy and fast-tracking poverty reduction, which can serve as a beacon for Africa.”

Monique Vanek, Bloomberg

Video - Nigerian businesses call for review of new currency trading guidelines

Operators argue the new regulation could drive many out of business after Nigeria’s Central Bank raised the minimum capital requirement for operators by over one thousand percent.

CGTN

Tribunal orders Multichoice to give one-month free subscription to subscribers in Nigeria, pay N150m fine

The Competition and Consumer Protection Tribunal (CCPT) on Friday slammed N150 million fine against Multichoice Nig. Ltd. for disobeying its order on subscription rates hike for DStv and Gotv packages.

The tribunal, sitting in Abuja, also ordered the pay television operator to give one-month free subscription to all its Nigerian subscribers on the DStv and Gotv platforms, for flouting its order.

The three-member tribunal chaired by Thomas Okosun, in a ruling, found Multichoice culpable of contempt by flouting its earlier order restraining the pay television operator from implementing hike in its subscription rates for DStv and GOtv.

The News Agency of Nigeria (NAN) reports that the CCPT had, on 29 April, restrained MultiChoice from increasing its tariffs and cost of products and services scheduled to begin on 1 May.

Mr Onifade, a lawyer and subscriber, had approached the tribunal contending that the eight-day notice given by Multichoice for a price hike was insufficient.

Respondents in the case were MultiChoice and the Federal Competition and Consumer Protection Commission (FCCPC).

He urged the tribunal to restrain Multichoice from implementing the tariff hike from 1 May as planned, pending the hearing determination of the petition.

The tribunal granted the ex-parte motion of the applicant and stopped Multichoice from going ahead with the price increase in the interim.

However, in defiance of the tribunal’s order, MultiChoice hiked its subscription rates for DStv and Gotv packages on the scheduled date 1 May.

Following the price hike, Mr Onifade, on 7 May commenced contempt proceedings against Mohammed Sani, Manager of Abuja office of MultiChoice Nigeria Ltd, over alleged disobedience to the order made by the CCPT.

The Notice of Consequence of Disobedience to Order of Court (Form 48) marked: CCPT/OP/02/2024 filed on 7 May by Mr Onifade warned Mr Sani against disregarding the tribunal order.

MultiChoice, through its lawyer, Moyosore Onigbanjo, a Senior Advocate Nigeria, filed a preliminary objection praying the tribunal to decline jurisdiction in the suit.

Mr Onigbanjo argued that such a price dispute case had been decided before in favour of his client.

Mr Onifade, in his response, urged the tribunal to discountenance the company’s objection and direct it to pay the sum of N10 billion or any amount the panel might deem fit in the circumstance for deliberately disobeying and failure to comply with the interim order.

The lawyer argued that the issue he brought did not border on price regulation or increase.

He explained that what he placed before the court was whether the company gave adequate notice in respect of the 1 May subscription price increase.

“It is our submission that the eight-day notice issued by Multichoice Nigeria Ltd is insufficient in law.

“A monthly subscriber should be given at least a month,” he said, praying the tribunal to dismiss the preliminary objection for being a waste of time of the court.

Delivering the ruling, the Thomas Okosun-led tribunal agreed with Mr Onifade’s submission, prompting the panel to affirm its jurisdiction and rule against the company.

The tribunal subsequently fixed July 3 for hearing of the substantive suit of the claimant.

Premium Times

Related stories: MultiChoice will pay settlement of $37.3 mln to Nigerian tax authorities

MultiChoice opens film school in Nigeria

Warner Music to Expand Into Lagos, Nigeria

Warner Music Africa (WMA) is planning to establish a new creative hub in Lagos, Nigeria.

The move will mark the opening of Warner’s first fully-owned office in the market. WMA says that its expansion into Lagos will enable it “to provide more of its A&R, Operations and Marketing expertise to Nigeria’s creative ecosystem”.

WMA’s plans to expand in Nigeria arrive at a time of significant recorded music industry growth in the wider Sub-Saharan Africa (SSA) region.

According to IFPI, Sub-Saharan Africa (SSA) was the fastest-growing music region in 2023. It was also the fastest-growing music region globally in 2022.

Recorded music revenues in Sub-Saharan Africa grew by 24.7% in 2023, fuelled, according to IFPI, by a 24.5% rise in paid streaming revenues.

Ahead of the opening of its new office in Lagos, Warner Music Africa’s management team, including Alfonso Perez-Soto, President of Emerging Markets, Warner Music; Laverne Thomas, Operations Lead, WMA; Temi Adeniji, Managing Director, WMA, and Yoel Kenan, CEO, Africori, met with government officials in Nigeria’s capital, Abuja last week.

According to Warner Music Group, this “pivotal journey” saw the executives engage in meetings with key government officials to “establish crucial relationships and to bolster WMA’s mission of empowering Nigeria’s vibrant creative sector”.

During the Warner executive team’s visit last week, they met two senior ministers and the Special Advisor to the President of Nigeria.

Amongst them were: Minister Ayodele Olawande, Nigeria’s Minister of State For Youth Development, who provides insights into youth empowerment initiatives and holds a crucial role in the creative sector for national development. They also met with Minister Hannatu Musawa, the country’s Minister for Art, Culture, and the Creative Economy, and a prominent Nigerian lawyer and politician.

The WMG team also met with Adeagbo (Oluwadunsin) Ayomide, the Special Advisor to the President on Arts, Culture and the Creative Economy.

WMG says that its meetings in Nigeria underscore its “longstanding commitment” to the market.

In 2019, Warner Music Group invested in independent Nigeria-based music company Chocolate City in a deal that WMG said at the time will “dramatically grow the reach of African artists around the world, and will create new opportunities for global superstars in the region”.

In 2022, Warner Music Group acquired a majority stake in Africori, a prominent African music distribution, music rights management and artist development company which has offices in Johannesburg, London and Lagos.

WMG first invested in Africori in early 2020. The original deal gave WMG access to what it called “Africa’s largest catalog and A&R network”, as well as enabling WMG to establish a presence in many African markets for the first time. WMG’s publishing division, Warner Chappell Music, also inked a global deal with Africori in 2020.

In addition, the Warner Music Group / Blavatnik Family Foundation Social Justice Fund (WMG/BFF SJF) has contributed more than USD $400,000 to Nigeria’s creative sector via its Repertoire and Core Funds.

For example, it contributed $200,000 in 2022 to the West African Vocational Education and $150,000 in 2023 to The Sarz Academy which nurtures emerging talent in music production.

Meanwhile, WMG noted on Wednesday (May 22) that Temi Adeniji and Alfonso Perez-Soto’s leadership “has been instrumental in driving the success of Warner Music’s global artists in Africa and their local repertoire across the globe”.

According to WMG, they have played “a pivotal role” in signing and promoting superstar Nigerian artist CKay, whose viral single Love Nwantiti has achieved significant success, recently being certified 8x platinum in the US.

Additionally, WMA recently signed 26-year-old Nigerian singer-songwriter Joeboy, who has amassed 2 billion streams over the past five years.

As part of the deal, Joeboy has created his own record label, Young Legend which will partner with Warner Music Africa for global distribution of its artists’ music.

Earlier this week, Temi Adeniji, Managing Director at Warner Music Africa and Warner’s SVP of Sub-Saharan Africa, joined the MBW podcast to discuss the rise of music from Africa and more.

By Murray Stassen, MUSIC BUSINESS WORLDWIDE

Video - Business returning to normal for Nigeria rice millers following lifting of sanctions with Niger

According to rice millers, prices of paddy rice have dropped by almost a third since March as cross-border trade rises between Nigeria and Niger.

CGTN

Stranded cargo shows credit challenges at Dangote refinery in Nigeria

Chinese state energy major PetroChina has been waiting to unload a cargo of U.S. crude at Nigeria's giant new refinery for nearly a month due to payment issues, according to four trading sources and shipping data.

The impasse highlights difficulties the $20 billion plant funded by Africa's richest man Aliko Dangote faces in its aim to be the biggest refinery on the continent and in Europe when it reaches full capacity this or next year.

Dangote aims to reverse the trend by which the oil-rich country exports its crude but almost totally relies on imports of fuel and other refined products.

The 2-million-barrel West Texas Intermediate (WTI) crude cargo shipped by PetroChina onboard supertanker Maran Mira has, however, been floating off Nigeria since March 28, shipping data on LSEG and Kpler showed.

The completion of the oil sale from PetroChina to Dangote has been delayed as the refinery has yet to issue a letter of credit to the Chinese trader, one source familiar with the matter said.

A letter of credit is the most common form of trade finance. A buyer's bank sends a letter to the seller's bank guaranteeing payment to the seller once goods arrive.

PetroChina was also not keen to receive oil products as payment, one of the ways that Dangote has been paying for its crude, the source said.

Two of the sources also told Reuters that the refinery has had difficulty accessing dollars through the Nigerian government, with the naira's slide against the U.S. dollar as global oil prices have risen straining Nigeria's finances.

The government did not immediately respond to a request for comment and a Dangote executive did not directly address the issue in comments to Reuters.

PetroChina has another 2 million barrels of WTI crude onboard supertanker Kondor that is making its way to Nigeria, according to another source and LSEG shiptracking data.

Potential sellers of U.S. WTI crude to Dangote have been confronted with difficult payment terms: either a 60 to 90 credit or an exchange of refined products for the crude oil, three of the sources said. Credit terms for oil deals are typically 30 days.

PetroChina did not respond to a Reuters request for comment.

A shipbroker estimated that the ship is incurring demurrage costs of around $65,000 a day.

Dangote group executive Edwin Devakumar told Reuters that seeking favourable sale prices and credit terms were normal business practices.

"If someone gives me one year credit, I'll grab it and if not, I'll negotiate the best possible deal," he said. "When you go to a shop to buy something ... You'll try the best possible deal and I do the same".

"We are not delayed. If someone's business is delayed, he is not giving us a good deal," Devakumar said, without specifically addressing the issue with PetroChina.

RAMPING UP

The refinery started operations in January and has reached half its capacity in recent weeks but a further increase is being slowed by its need to borrow billions of dollars in working capital to be able to buy large volumes of crude, trading sources said.

Devakumar declined to comment on the current run rates at the refinery.

The facility is importing around 10 crude oil cargoes a month, two traders said, roughly half the capacity of 650,000 barrels per day (bpd) it seeks to reach this year or next, which would make it the largest refinery in Africa and Europe.

The amount of Nigerian and U.S. crude discharged at Dangote totalled 8.4 million barrels in March and 5.4 million barrels so far in April, Kpler data showed. Another 1 million barrels of Nigerian crude is expected to arrive on April 27.

Trafigura, Mercuria, Vitol, Shell and NNPC were among Dangote's suppliers of crude last month, according to Kpler. 

By Florence Tan, Reuters 

Related stories: Video - Nigeria government directs crude oil be sold to domestic refineries first

Dangote refinery supplies petroleum products to local market in Nigeria

Analysts skeptical about improvement of local crude refining in Nigeria

Nigeria has been Africa’s largest or second-largest oil exporter for years, but relies heavily on imports to meet local energy needs. The government is trying to change that, saying the country’s four moribund oil refineries will be revived and put back in operation.

This week, authorities also announced a new policy that oil producers must sell a share of their crude oil to local refiners before they are permitted to export crude.

Nigeria’s petroleum regulatory commission announced the new Domestic Crude Oil Supply Obligation (DCSO) during a meeting with industry players. It's part of an amendment to Nigeria’s Petroleum Industry Act of 2021.

Under the policy, Nigerian oil producers are allowed to export crude only after meeting their supply obligations to local refiners.

The measure will take effect in the second half of the year, but it does not specify what quantity of crude must be supplied to local refineries.

Authorities said the objectives of the guideline are to bolster Nigeria’s refining capacity, improve the oil industry and earn foreign exchange.

Public affairs analyst Jaye Gaskiya said it was the right move. "In the current situation globally, this is actually going to turn out much more beneficial to both the producers and refiners in the country," Gaskiya said. "Essentially this is designed to ease the problem of supply to the local refineries so that they don't become redundant. The second thing is that it is also designed in such a manner to ease the pressure on the naira," which is the currency of Nigeria.

According to the regulations, payments for crude to domestic refiners can be made in dollars, naira or a combination of both.

Nigeria relies heavily on imports to meet the population’s energy needs. Analysts say refining crude oil locally could reverse this trend.

But oil and gas analyst Toyin Akinosho said he had concerns.

"In principle, I do not have a problem with it, but we need to be very careful about the foreign exchange implications and also the volumes that are going out," he said. "My challenge has always been, if you are overzealous about certain regulations, you can burn your fingers. In an era of very low forex [currency trading] and this being the major avenue for inflow into the country, you have to find a way of managing it."

The new measure includes penalties for oil producers who divert crude oil or refiners who fail to meet payment obligations.

But Gaskiya said there were some loose strings to the rule.

"The regulation says it is on the basis of willing buyer and willing seller, and that's quite tricky," Gaskiya said. "A situation where you have the suppliers, for instance, being unwilling, what are you then going to do as the regulator? So those are the things that the regulator needs to be on the lookout for."

The refineries in Nigeria, including the latest one built by Africa's richest man, Aliko Dangote, will have a combined processing capacity of 650,000 barrels of crude oil per day when rehabilitated.

While experts have doubts the new guidelines will be effective, authorities are optimistic Nigeria is getting closer to its goal of having a self-sufficient energy sector.

By Timothy Obiezu, VOA 

Related story: Dangote refinery supplies petroleum products to local market in Nigeria

Libya overtakes Nigeria as Africa's largest oil producer

Heineken Shuts Down Two Plants in Nigeria

Beer-manufacturer Nigerian Breweries will shut down two of its nine manufacturing plants in Nigeria due to the harsh economic situation in the country, the company said in a note to the Nigerian Exchange Limited on Thursday.

Police makers at the company deemed the decision necessary due to operational concerns which was massively impacted by record foreign exchange loss up to the tune of N153.3 billion last year.

It’s the Nigerian subsidiary of Heineken Brouwerijen B.V’s highest foreign exchange loss in the company’s history since it began operations in Nigeria 77 years ago.

The company said it recognised how the closure of the two plants would affect workers in the affected locations. But he said the company was committed to reduce the effect of the situation by providing severance packages to the affected employees.

“We recognise and regret the impact that the suspension of brewery operations in the two affected locations may have on our employees,” said Hans Essaadi, the managing director of the company.

He added, “We are committed to limiting the impact on people as far as possible and providing strong support and severance packages to all affected.”

The decision will help the company to retain 15 per cent capacity expansion over the past decade as well as reduce costs of production, Bloomberg Africa reported.

By Victor Olorunfemi, Peoples Gazette

Related stories: Video - Why Are Multinationals Like P&G, GSK and Sanofi Leaving Nigeria?

Video - Nigeria advocates for increased patronage of locally manufactured goods

 

 

Libya overtakes Nigeria as Africa's largest oil producer

Libya overtook Nigeria as the top African crude oil producer for March, data from the Organization of Petroleum Exporting Countries (OPEC) has shown. According to the April 2024 Monthly Oil Market Report (MOMR), Libya recorded 1.236 million barrels per day (bpd) of crude production in March, up from 1.173 million bpd in February.

Meanwhile, Nigeria recorded an output of 1.23 million barrels per day in March 2024, compared to 1.32 bpd in February 2024. Despite the drop in output by 6.8 per cent, Nigeria retained its leadership position on the continent, producing 1.398 million bpd, while Libya produced 1.161 million bpd during the period.

“According to secondary sources, total OPEC-12 crude oil production averaged 26.60 mb/d in March 2024, 3 tb/d higher, m-o-m. Crude oil output increased mainly in IR Iran, Saudi Arabia, Gabon, and Kuwait, while production in Nigeria, Iraq, and Venezuela decreased.”

According to direct communications from OPEC, the recent drop in the country’s crude production can be attributed to a surge in pipeline vandalism and crude oil theft incidents in its oil-producing region.

Experts weighed in, saying that this has led to a decline in business activity and subdued consumer spending, high input-cost inflation, and lower employment levels compared with the previous year.

In other news, the Dangote oil refinery in Nigeria has started supplying petroleum products to the local market, a major step in the country's journey towards energy self-sufficiency. Devakumar Edwin, an executive at Dangote Group, confirmed the arrival of diesel and jet fuel shipments in the local market.

Abubakar Maigandi, head of the Independent Petroleum Marketers Association of Nigeria, also said that local oil marketers reached an agreement on the price of diesel at 1,225 naira ($0.96) per litre following a bulk purchase deal. Maigandi noted that the association's members oversee about 150,000 retail stations throughout Nigeria. 

By Victor Oluwole, Business Insider Africa

Related story: NNPC faces $3 billion backlog on petrol payments

Video - Nigeria advocates for increased patronage of locally manufactured goods

In a bid to alleviate the country's over-dependence on imports, which has contributed to the devaluation of the Naira against the U.S. dollar, the Nigerian government is championing the consumption of domestically produced goods. However, this initiative faces challenges, with the Manufacturers Association of Nigeria citing the closure of over 700 companies and distress among 300 others due to various hurdles. 

CGTN

Related story: Video - Nigeria manufacturing sector braces for higher production cost

 

Video - Stock Exchange of Nigeria acquires stake in Ethiopia Securities Exchange

NGX, based in Lagos, and other institutional investors poured large sums of cash into the Ethiopian exchange during its recent capital-raising endeavor. This strategic move aligns with NGX's objectives to expand capital market activities in East Africa and foster cross-border investment flows across the continent.

CGTN