NNPCL to pay pending $1.76bn equity in Dangote Refinery – Newstrends
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NNPCL to pay pending $1.76bn equity in Dangote Refinery

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1 year ago

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Dangote Refinery

NNPCL to pay pending $1.76bn equity in Dangote Refinery

The Nigerian National Petroleum Company Limited (NNPCL) is to pay its pending $1.76 billion equity in Dangote Refinery with $2.5/barrel crude oil and dividend accruals.

The NNPCL disclosed that once the plant came on stream, which was initially for April 2023, it would begin the discounting of $2.5 for every barrel from the supply of 300,000 barrels per day to offset its remaining equity participation.

This is contained in NNPCL’s latest Audited Financial Statement (AFS) released on Friday.

“In September 2021, the NNPC acquired 20 per cent interest in Dangote Petroleum Refinery and Petrochemicals Free Zone Enterprise (DPRP FZE) worth $2.76 billion. This investment is held by NNPC Greenfield (a special purpose vehicle that is 100 per cent owned by NNPC) in trust for NNPC.

“This acquisition was financed by a $1.036 billion funding of which $1 billion was paid to Dangote Refinery and $36 million accounting for transaction costs.

“The balance of the cost of equity investments made in DPRP FZE, which is $1.76 billion will be paid upon completion of the refinery project starting April 1, 2023 or any other date agreed between the parties, that is the NNPC and Dangote Oil Refining Company Limited.

“(This shall be done) via a combination of a $2.5/bbl discount on the official selling price per barrel on 300,000 barrels per day to DPRP FZE, and 100 per cent of NNPC’s portion of any dividend declared by DPRP FZE throughout the repayment period,” the report said .

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However, it stated that it already entered into a forward sale agreement with Lekki Refinery Funding Limited, to supply 35,000 barrels of crude oil per day for the settlement of the $1.036 billion (N426.2 billion) funding already received for the financing of the investment in Dangote refinery.

“The interest rate for the facility is three-month libor plus 6.125 per cent. The arrangement has been scheduled to commence from August 30, 2023. Project Bison has been transferred to NNPC Limited,” the AFS highlighted.

Aside from the 35,000 forward sale for the repayment of the $1 billion part payment for the Dangote refinery, the NNPC also has a 90,000 bpd oil-for-debt financing deal of $3.3 billion with Afreximbank.

The increase in the overall performance of the NNPC, including the profit which it attributed to “owners of the company” and “non-controlling interest”, may also have been further enhanced by the recent decision to take the liability occasioned by the controversial fuel subsidy off its books after commercialisation.

Meanwhile, the report said NNPCL increased its revenue profile by 37.2 per cent, from N6.42 trillion in 2021 to N8.81 trillion in 2022, its latest Audited Financial Statement (AFS) released yesterday revealed.

The document, the fourth in the series to be made public since 1977, when the then NNPC began operations, also showed that the company recorded Profit After Tax (PAT) of N2.52 trillion, representing about 274 per cent increase when compared to the N674 billion it recorded in 2021.

In all, the audited statement for the year ended December 2022 showed that during the period under review, the NNPC had total non-current assets of N37 trillion and current assets of N21.59 trillion, to give a total of N58.65 trillion in assets.

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It also meant an increase by about 260.47 per cent compared to N16.27 trillion in 2021. But non-current liabilities stood at N19.98 trillion, while current liabilities were N29.3 trillion, to hit N49.35 trillion at the end of 2022 as against N13.46 trillion in 2021. This was an increase of about 266.6 per cent.

According to the new AFS, deferred tax liabilities was N13.23 trillion during the year, while deferred tax assets were N3.098 trillion. Cost of sales climbed to N6.7 trillion in 2022, that is, a 25.47 per cent increase from N5.34 trillion in 2021.

The NNPCL’s auditors noted that for the 16-month period ending December 2022, they had no doubt that the NNPC could continue as a going concern without fear of going bankrupt.

“The financial statements have been prepared in accordance with the going concern principle under the historical cost convention.

“Nothing has come to the attention of the directors to indicate that NNPC will not remain a going concern for at least 12 months from the date of these financial statements. At this time, no significant events after the reporting date that may have an impact on going concern have been noted,” the auditors said in their notes to the 2022 AFS.

Signed into law by ex-President Muhammadu Buhari in 2021, under the PIA, NNPC officially ‘transformed’ from a state-run oil corporation to a commercial venture in July 2022, even though it is still, to a large extent, being controlled by the federal government.

Looking back, in 2018, the NNPCL recorded a loss of N803 billion, while in 2019, it was reduced to N1.7 billion by the company. The NNPCL appeared to have turned the corner in 2020 when it posted a profit of N287 billion for the first time in its history and thereafter disclosed N674.1 billion as profit in 2021.

NNPCL to pay pending $1.76bn equity in Dangote Refinery

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Why governors’ forum is silent on Rivers emergency, by DG

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11 hours ago

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March 23, 2025

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Why governors’ forum is silent on Rivers emergency, by DG

The Nigeria Governors’ Forum (NGF) yesterday attributed its neutral position on the recent declaration of a state of emergency in Rivers State to the need to steer clear of taking positions that may alienate members with varying political interests.

Taking positions on contentious partisan issues, the NGF said, would not augur well for it, especially in view of its past experience in fundamental division.

Notwithstanding, the declaration of the state of emergency by President Bola Tinubu yesterday generated more kudos and knocks from across the country.

Special Adviser to the President on Senate Matters, Senator Basheer Lado, said the action of the president was meant to ensure protection of lives and restoration of law and order in the state, while the President’s Special Adviser on Media and Public Communications, Sunday Dare, said his principal  was required  to “avert needless harm and destruction .”

National Publicity Secretary of the ruling All Progressives Congress (APC), Felix Morka, said Tinubu, by his action, cleared what had manifested as a constitutional crisis in Rivers state.

But former President Goodluck Jonathan saw it from a different perspective.

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He described “abuse of office and power by the three arms of government in the country“ as a dent on Nigeria’s image.

The NGF, in a statement by its Director General Abdulateef Shittu, said it is essentially “an umbrella body for sub-national governments to promote unified policy positions and collaborate with relevant stakeholders in pursuit of sustainable socio-economic growth and the well-being of the people.”

It added: “As a technical and policy hub comprising governors elected on different platforms, the body elects to steer clear of taking positions that may alienate members with varying political interests.

“In whatever language it is written, taking positions on contentious partisan issues would mean a poor sense of history — just a few years after the forum survived a fundamental division following political differences among its members.

“Regardless, the Forum is reputed for its bold positions on governance and general policy matters of profound consequences, such as wages, taxes, education and universal healthcare, among others.”

It asked for “the understanding of the public and the media, confident that appropriate platforms and crisis management mechanisms would take care of any such issues.”

Why governors’ forum is silent on Rivers emergency, by DG

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Rivers: Tinubu acted to save state, economy, says Karimi

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1 day ago

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March 22, 2025

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Chairman of the Senate Services Sunday Karimi

Rivers: Tinubu acted to save state, economy, says Karimi

Chairman of the Senate Services Sunday Karimi has hailed President Bola Tinubu for the decision to declare a state of emergency in Rivers State.

 He told reporters on Friday in Abuja that the President acted in the best interest of the State and Nigeria, having taken his decision in compliance with the Constitution.

“No President or government worth a name, will fold its arms and watch a political situation deteriorate to what we saw unfolding in Rivers State.

“We saw that bombing of pipelines had begun, and the security situation was getting worse with the tension everywhere”, Karimi stated.

Karimi, who represents Kogi-West on the ticket of the All Progressives Congress (APC), recalled the “fatherly role” Tinubu had played in the crisis since 2023 in a bid to get the Minister of the Federal Capital Territory (FCT), Nyesom Wike, and suspended Governor Siminalayi Fubara to reach an understanding, to no avail.

He explained: “We were all here in 2023 when Mr President called that truce meeting at the Aso Rock Villa. There was the eight-point agenda for settlement reached between the factions.

“When Nigerians expected that progress should be made to achieve peace, things started deteriorating considerably to a point where the governor demolished the House of Assembly building and administered the state with only three legislators.”

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Karimi observed that with the recent judgment of the Supreme Court, which gave the upper hand to the 27 lawmakers loyal to the camp of the FCT Minister, matters merely got worse in the State as the lawmakers were set to impeach the Governor.

“What did you expect would be the implications? There would have been more destruction, killings and economic losses for the country.

“With the bombings that had already started, it was a matter of time before the whole state would be engulfed in flames. No responsible President would sit, arms folded, and allow that to happen “ he added.

The senator further argued that it took “painstaking efforts” by the administration to raise daily crude oil production to around 1,800 barrels, noting that Nigeria’s economy was already “witnessing a rebound under the renewed hope projects of the government.”

“Allowing the situation in Rivers to get worse before he would act, wouldn’t have helped the state or Nigeria as a country in any way.

“Mr. President intervened at the right time, and his actions are covered by law,” he said.

Karimi also spoke on the emergency declaration  in Borno, Yobe, Adamawa and a couple of other states by former President Goodluck Jonathan without removing the Governors from office or suspending the state assemblies.

According to him, the case with those States was not generated by political crises but rather security concerns.

“So, I will advise those comparing the two scenarios to remember that one was purely about security threats resulting from the insurgency caused by Boko Haram, while that of Rivers is clearly political.

“It was the proper thing to do to suspend the political actors in the two factions to allow for tensions to diffuse. Nigerians should appreciate the President for the action he has taken so far,” he stated.

Sen. Karimi also noted that there was no cause for alarm as the National Assembly had indicated that the emergency rule could be reviewed as soon as there were signs that things could quickly normalise in Rivers State.

 

Rivers: Tinubu acted to save state, economy, says Karimi

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Just in: Tinubu swears in Rivers Sole Administrator Ibas

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4 days ago

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March 19, 2025

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Just in: Tinubu swears in Rivers Sole Administrator Ibok-ete Ibas 

President Bola Tinubu has sworn in Vice Vice Admiral Ibok-ete Ibas (Retd.) as the Sole Administrator of Rivers State.

The administrator was sworn in on Wednesday after a short meeting with the President.

Tinubu announced the appointment of the retired naval chief at a nationwide broadcast on Tuesday, when he declared a state of emergency in Rivers State and suspended Governor Siminalayi Fubara, Deputy Governor, Ngozi Odu, and the state House of Assembly members.

The President said his decision was based on Section 305 of the 1999 Constitution, saying he could not continue to watch the political situation in Rivers escalate without taking concrete action.

The suspension of Fubara and other elected representatives has been rejected and condemned by many eminent Nigerians, legal luminaries, groups such as Atiku Abubakar, Peter Obi, Femi Falana, the Labour Party (LP), the Peoples Democratic Party (PDP) and the Nigerian Bar Association.

However, the emergency rule has been praised by the pro-Nyesom Wike Assembly led by Martins Amaewhule, accusing Fubara of contravening the Supreme Court ruling on the political situation in the state.

Ibas was the Chief of Naval Staff from 2015 to 2021.

He is from Cross River State where he had his early education.

The new sole administrator went to the Nigerian Defence Academy in 1979 from where he proceeded to have a successful career in the Navy, rising through the ranks to the very top.

He is a member of the Nigerian Institute of International Affairs (NIIA) and the Nigerian Institute of Management.

President Muhammadu Buhari who appointed him as Chief of Naval Staff conferred him with the National Honour of Commander of the Federal Republic (CFR) in 2022.

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