Minister of Petroleum says Job creation will end pipeline vandalism in Nigeria

The Minister of Petroleum Resources, and Group Managing Director of Nigerian National Petroleum Corporation, NNPC, Dr. Ibe Kachikwu, has stated that Nigeria would not totally eradicate pipeline vandalism without creating an enabling environment that will empower militants in the Niger Delta.

Kachikwu, who made this disclosure in Uyon, the Akwa Ibom State capital, noted that with the array of pipeline bombings by the Nigerian Delta Avengers, NDA, it would take nothing less than 15 to 20 years to get infrastructure in the oil sector working.

According to him, “Modular refineries are going to be the answer to our problems in the future. We talk about the militants and their agitations; the reality is that until we begin to put things in place that would have these so called ‘militants’ find opportunities in the sector, the destruction is going to continue.

“I have appealed to those who are breaking oil pipelines for now, the Niger Delta Avengers and everybody else, and as you know, we are engaging in negotiations for us to find peace this week and be able to enter a truce that stops all the destruction.”

Kachikwu noted that Akwa Ibom would have an oil depot, as his ministry developed a document basically on relationship with oil producing states.

He said: “So we can find a direct link between what we do and the oil that we produce. Then the restiveness will go. More than just the depot, I think Akwa Ibom deserves more.”

Daily Post

Nigeria finally gives in and will float the troubled Naira

After months of dithering, Nigeria’s Central Bank will allow the national currency’s value be determined by market forces after removing pegs which tied it to a fixed figure. The new policy will take effect from June 20 and will effectively devalue the naira.

The naira was officially pegged at around 199 naira to $1 but as the economy tanked and foreign reserves dried up, the Central Bank allowed few local businesses or individuals access to dollars at that rate. On the more commonly used parallel markets it traded around 350 naira to $1, which many believe is a fairer reflection of its value. It is a departure from the Central Bank’s former position as the sole dealer and means the naira will now be traded through the Central Bank’s selected primary dealers.

The policy change has been largely welcomed. It follows months of fuel shortages, record inflation and investor withdrawal—occasioned by a stubborn refusal to devalue the currency in the face of dipping revenues as a result of the sharp drop in the price of oil, the country’s main resource. Manji Cheto, senior vice president at London-based Teneo Intelligence says the Central Bank’s change of tack “is a clear admission that its earlier policies had failed.”

The Central Bank’s refusal to devalue the naira reflected the position of Nigeria’s president, Muhammadu Buhari. He has said a devaluation was tantamount to ‘killing the naira’. Even though the Central Bank is supposed to operate independently of government the president’s stated position is believed to have influenced the Central Bank. The administration’s refusal to devalue, despite pleas from international and local economists, triggered investor caution in light of the country’s strict monetary policies.

The apex bank says it will periodically intervene in the market, stating conditions under which this could happen in its new guidelines on trading foreign exchange. But Cheto says the possibility of an intervention means the new policy can only be described as a “managed float.”

The Central Bank expects its new policy to close the gap in the current dual exchange rates possibly merging the pegged rate of the naira and its value on the parallel market where it has typically traded around 50% higher for most of the year. “We’re talking about an open, transparent two-way system,” Godwin Emefiele, Central Bank governor said at a press conference. “It’s intended we don’t have speculators and rent-seekers. I don’t expect that any other exchange rate will be recognized.”

Quartz

Related story: President Muhammadu Buhari rejects calls to devalue the Naira

President Buhari says Nigeria must 'radically' boost exports

Nigeria must “radically” increase its exports to ease shortages of foreign exchange in the oil-dependent West African nation, President Muhammadu Buhari said.

“In a world of lower oil prices and dollar revenues, the only sustainable path is to reduce Nigerians’ over-reliance on imports,” Buhari, 73, who came to power in May 2015, wrote in an opinion piece published in the Wall Street Journal on Monday. “We must rebalance our economy by empowering entrepreneurs and producers, big and small, to create more of what their fellow Nigerians demand.”

The government will help local businesses by encouraging more investment in infrastructure and lowering taxes on small companies, he said. It will also “eliminate bureaucracy to bring the informal economy out of the shadows.” The central bank will introduce a more flexible foreign-exchange policy, Buhari wrote, without giving any details of plans first announced by Governor Godwin Emefiele on May 24.

Africa’s largest economy has been battered by the fall in oil prices since mid-2014 and a drop in production this year to an almost three-decade low as militants bomb crude and gas pipelines. The economy contracted in the first quarter for the first time since 2004 and a recession is imminent, according to the central bank. Inflation accelerated to 15.6 percent in May, the highest rate since early 2010, the national statistics office said on Tuesday.

Bloomberg

Nigeria sacks entire cricket team including coaches

In a bizarre, yet not unexpected move, the Nigeria Cricket Federation has sacked the entire men's cricket team and their Indian coach, Shriam Regananthian.

This was after the side failed in the ICC World Cricket League Division Five tournament held last month in UK, finishing bottom of the table.

The team had just one win over Tanzania and lost to Oman, Guernsey, Vanatu and Jersey. The team also lost to Tanzania again to claim the bottom spot. Jersey went on to become champions.

Federation president, Emeka Onyeama added that national chief coach Uthe Ogbimi has also been relieved of his duty with the team. He blamed Ogbimi and the team Captain Kunle Adegbola for the embarrassing campaign. He however refused to blame the Indian level A coach who joined the team on the eve of their departure to UK.

According to him, the team underperformed despite having intensive preparations and increment of their daily allowance to $100 per day from the old regiment of $25- $50 per day.

He declared that the federation would now undertake a rebuilding process where young players from the U-19 team would be upgraded to the national team.

He said a new national coaching crew will be announced in the wake of the proposed North West Africa Tournament and ICC/Africa T-20 tournament scheduled for September.

Vanguard

Niger Delta Avengers threaten more violence

The Niger Delta Avengers (NDA) has warned Nigerian authorities it may “review our earlier stance of not taking lives” if oil companies continue to operate in the country’s oil hub.

The militant group has launched a series of attacks on oil pipelines and facilities in the Niger Delta, where the majority of Nigeria’s oil reserves are concentrated. The NDA has so far rejected offers of dialogue from the Nigerian government and vowed to continue its Operation Red Economy, the purported goal of which is to reduce the West African country’s oil production to zero.

In a statement published on its website on Monday, the NDA said that the oil companies must not carry out any repair works on the affected pipelines and that buying of crude oil from the Niger Delta must be suspended “as we await the right atmosphere that will engender genuine dialogue.”

The NDA has claimed attacks on facilities belonging to several international oil companies, including Royal Dutch Shell, U.S. firm Chevron and Italian oil giant ENI. Some of their attacks have shown a high degree of sophistication and have taken down strategically-important pipelines—the first attack claimed by the group was on an underwater pipeline at Shell’s Forcados terminal and forced the company to temporarily shut down the 250,000 barrels per day (bpd) terminal.

Nigerian oil minister Emmanuel Ibe Kachikwu attempted to reach out to the militants earlier in June, saying that the Nigerian military would step back from pursuing the group in order to establish a platform for dialogue. In Monday’s statement, however, the NDA said it would only participate in dialogue with “independent mediators” appointed by the international oil companies working in the region.

Historically, the Niger Delta has been the site of previous uprisings by militant groups, who have claimed that the impoverished region does not benefit sufficiently from its oil wealth. In the mid-2000s, militants led by the Movement for the Emancipation of the Niger Delta (MEND) decimated the country’s oil production and kidnapped oil workers, with the insurgency only coming to an end in 2009 with the introduction of an amnesty program for the fighters. MEND has publicly called upon the NDA to engage in dialogue with the government, but the latter group has rejected the former and criticized its leaders for abandoning their cause.

Largely as a result of attacks by the NDA and other militants, Nigeria’s oil production has plummeted from 2.2 million bpd to a 20-year low of between 1.5 million and 1.6 million bpd.

Newsweek