Business
We’re in debt, can’t guarantee regular fuel supply – NNPC
We’re in debt, can’t guarantee regular fuel supply – NNPC
The Nigerian National Petroleum Company Limited has said its ability to meet the daily fuel demand and consumption in the country is severely threatened.
The company attributed the troubling development to the massive debt it owed petrol suppliers, saying the difficulty financial situation it finds itself is hampering its ability to meet its fuel supply obligations.
Reports had previously emerged that a $6 billion debt the NNPCL owes petrol suppliers has aggravated petrol scarcity in Nigeria, a perennial feature since the beginning of 2024.
The NNPCL on different occasions had blamed logistics challenges, and flooding, amongst others factors for the supply shortages of the essential commodity.
However, in a statement on Sunday, NNPCL spokesman Olufemi Soneye finally admitted the company’s “significant debt to petrol suppliers”
He said: “this financial strain has placed considerable pressure on the company and poses a threat to the sustainability of fuel supply”.
“In line with the Petroleum Industry Act (PIA), NNPC Ltd remains dedicated to its role as the supplier of last resort, ensuring national energy security.
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“We are actively collaborating with relevant government agencies and other stakeholders to maintain a consistent supply of petroleum products nationwide.”
Nigeria, Africa’s most populous nation, faces energy challenges, with all its state-owned refineries moribond. The country is heavily dependent on imported refined petroleum products, with the state-run NNPC being the major importer of the essential commodities.
Fuel queues are commonplace in the country. Prices of petrol tripled since the removal of subsidy in May 2023, from around ₦200/litre to about ₦800/litre, compounding the woes of the citizens who power their vehicles, and generating sets with petrol, no thanks to decades-long epileptic electricity supply.
The government simultaneously unified forex windows, with the value of the naira nosediving terribly from $1/₦700 to over $1/₦1600 at the parallel market. Prices of food and basic commodities immediately climbed through the roof as Nigerians battled attendant inflation.
Recently, the Independent Petroleum Marketers Association of Nigeria (IPMAN) said the landing cost per litre of petrol has made it impossible for petrol marketers to import the essential commodity just as being done by the NNPCL.
“Right now, the landing cost of PMS is over ₦1,200, without the margin of the marketers, transportation and other logistics,” said IPMAN National Operations Controller, Zarama Mustapha.
“NNPC sells to marketers at ₦565 or so. That means there is a subsidy of almost ₦600 to ₦700 as of now.
“Whether they (government officials) say there is subsidy or there is not subsidy, the fact on the ground clearly states that there is something they are under-recovering.”
We’re in debt, can’t guarantee regular fuel supply – NNPC
Business
Naira exchanges N1,650/$ in parallel market
Naira exchanges N1,650/$ in parallel market
Yesterday, the Naira appreciated N1,650 per dollar in the parallel market, compared to N1,655 on Monday.
Similarly, the Naira appreciated to N1,535 per dollar in the official foreign exchange market.
Data published by the Central Bank of Nigeria, CBN, showed that the exchange rate for the Nigerian Foreign Exchange Market (NFEM) fell to N1,535 per dollar from N1,537 per dollar on Monday, indicating N2 appreciation for the naira.
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Consequently, the margin between the parallel market and NFEM rate narrowed to N115 per dollar from N118 per dollar on Monday.
Naira exchanges N1,650/$ in parallel market
Business
Exchange rate ends 2024 at N1,535/$1, marking a 40.9% depreciation
Exchange rate ends 2024 at N1,535/$1, marking a 40.9% depreciation
The exchange rate between the naira and the dollar ended the year at N1,535/$1 representing a 40.9% depreciation for 2024.
The official exchange rate between the naira and dollar closed in 2023 at N907.11/$1 thus depreciating by 40.9% for the year which compares to a 49.1% devaluation at the end of 2023.
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Nigeria introduced several foreign exchange policies in 2024 as the central bank expanded on market-friendly forex policies to attract foreign investors.
Meanwhile, on the parallel market where the exchange rate is sold unofficially, the naira exchanged for N1,660 to the dollar when compared to N1,215/$ according to Nairametrics tracking records. This represents a 26.8% depreciation.
Exchange rate ends 2024 at N1,535/$1, marking a 40.9% depreciation
Business
Warri refinery: Marketers hopeful of further petrol price drop
Warri refinery: Marketers hopeful of further petrol price drop
There was excitement on Monday as the Warri Refining and Petrochemical Company (WRPC) commenced partial production.
This is coming after nearly a decade of dormancy as the 125,000 barrels per day refinery was confirmed to be working at 60 per cent capacity, according to the Nigerian National Petroleum Company Limited (NNPCL).
The refinery, inactive since 2015 due to prolonged repairs, reportedly began refining activities last Saturday at its Area 1 plant, where crude oil was successfully pumped into the system.
This was coming about a month after the commencement of operations at the 60,000-barrel-per-day-old Port Harcourt Refinery.
The NNPCL Group Chief Executive Officer, Mele Kyari, announced the resumption of operation at the Warri Refinery during a tour of the facility on Monday.
Kyari was seen in a video posted by Channels TV addressing a tour team, which included the Chief Executive Officer of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, Farouk Ahmed.
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Earlier, Kyari explained that the inspection aimed to show Nigerians the level of work completed so far.
He said though the repairs on the facility were not 100 per cent complete, operations had commenced.
He said, “We are taking you through our plant. This plant is running. Although it is not 100 per cent complete, we are still in the process. Many people think these things are not real. They think real things are not possible in this country. We want you to see that this is real.”
With the addition of Warri Refinery, Nigeria’s refining capacity has further increased with marketers anticipating a further reduction in price of premium motor spirit (PMS).
The 650,000-barrel Dangote Refinery has commenced production in addition to the Port Harcourt Refinery with a total capacity of 210,000 barrels per day (bpd) comprising 60,000 bpd for the old plant and 150,000 bpd for the new plant.
It’s good for business, prices may reduce – Marketers
Major Energy Marketers’ Association of Nigeria (MEMAN) and the Independent Marketers Association of Nigeria (IPMAN) welcomed the revival of the Warri refinery, saying it would deepen competition, diversify supply and ultimately resort to price reduction.
Executive Secretary of MEMAN, Clem Isong in a chat with our correspondent stated that the Warri Refinery is the shortest route to the North, describing its revival as good news.
“The market becomes more competitive and we are diversifying supply,” he said.
On whether it would lead to price reduction, he stated, “There are many factors that affect price, competition is always good and you can always get your product at the best price.”
National Public Relations Officer of IPMAN, Alhaji Olanrewaju Okanlawon in a chat with our correspondent said, “If there is excess supply, it will keep bringing down the price. We now run a free market and it is about demand and supply. It will continue bringing down the price. It will decongest Lagos.”
Energy expert, Dr. Ayodele Oni said the resumption of Warri Refinery would boost the local refining capacity in addition to enabling the country to sell to other neighbouring countries.
“We can refine more and even have some to sell. We now stop being hewers of wood and drawers of water. We add value to what we produce and can make/ do more with our base resources. This is very pleasant news,” he said.
Warri refinery: Marketers hopeful of further petrol price drop
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