Economy & Politics
Nigeria is exploring getting IOCs to refund $21 billion
International Oil Companies (IOCs) in the country may have a huge bill to pay as the House of Representatives have blamed the Department of Petroleum Resources (DPR) for its failure to renew agreements on Production Sharing Contracts (PSCs). The lower house has also resolved to write the embassies of the affected IOCs seeking for a refund.
Solomon Ewuga who represented the DPR during the hearing, stated that the agency had had begun a review of the PSCs, but it had been stalled.
Minister of State for Petroleum, Ibe Kachikwu in December last year disclosed that the Federal Governnment had intentions to amend the deep offshore act. He also estimated that Nigeria had lost over $21 billion by not enforcing the deep offshore act.
What is a Production Sharing Contract ?
The Production Sharing Contract Act of 1993 was enacted in response to the difficulties faced by the government in funding Joint Venture (JV) arrangements as well as encourage companies to invest the deep offshore space.
Under this arrangement, the NNPC holds the blocs while the oil companies are “contractors”. The contractor bears all costs of exploration and production, and will receive no refunds in the event of no oil being found.
Cost is recoverable only if the find is in commercial quantity, with provisions made for taxes, capital and investment costs. The government( through the NNPC), then works out a sharing formula with the oil company. Majority of these PSCs were negotiated at the time oil was trading below $20, and account for some of Nigera’s most prolific oil blocs.
A section of the Act provides the review of the agreement once the crude oil price exceeds $20 per barrel. Oil price has traded above $20 for over a decade but no form of review was carried out.
Easier said than done
The move by the government to renegotiate terms may be near impossible, as the leases are currently running. A few them however are up for renewal in a few years.
More uncertainty
News of possible backdated payments adds to the uncertainty surrounding the petroleum industry in the country. More so with President Muhammadu Buhari’s refusal to sign the Petroleum Industry Governance Bill (PIGB).
Economy & Politics
Why Okonjo-Iweala should win the WTO DG role – Prof. Moghalu
Professor Kingsley Moghalu has thrown support behind Dr. Ngozi Okonjo-Iweala to win the World Trade Organization top job.
A former Deputy Governor of the Central Bank of Nigeria, Professor Kingsley Moghalu, has publicly canvassed support for Dr. Ngozi Okonjo Iweala to win the World Trade Organization (WTO) top job.
The former professor of public policy at Fletcher School, Tufts University, made the disclosure via his official Twitter handle, as seen by Nairametrics
READ: WTO: Okonjo-Iweala invites volunteers, says she has no money for PR firm
Prof. Moghalu made a strong case for why Africa’s candidate should be considered for the top shot, noting that the need for Africa to get a better deal in the world trading system should be a major criterion in selecting the next WTO DG. He also believed that correcting this negatively skewed trade deal will help tackle poverty and underdevelopment in Africa.
The dynamics of world trade are rigged against Africa, keeping the continent poor and undeveloped. In this piece for Project Syndicate @ProSyn I make a strong case for why Africa’s candidate, @NOIweala, should be selected as the next Director-general of @wto https://t.co/G4Fyxd1z91
— Kingsley Moghalu (@MoghaluKingsley) October 26, 2020
READ: WTO: Nigeria’s Ngozi Okonjo-Iweala gets European Union support
What you should know
Nairametrics had earlier reported that Nigeria’s Ngozi Okonjo-Iweala and South Korea’s Yoo Myung-hee have emerged as the last two candidates for the top WTO job.
Prof. Moghalu also disclosed that the final selection decision is expected this week or very early next week.
(READ MORE:WTO DG: Okonjo-Iweala gets the backing of 79 countries so far)
Prof. Moghalu said, “The dynamics of world trade are rigged against Africa, keeping the continent poor and undeveloped. In this piece for Project Syndicate @ProSyn, I make a strong case for why Africa’s candidate, @NOIweala, should be selected as the next Director-General of @wto.
“The final selection decision is expected this week or very early next. Alongside the case for why the African candidate Okonjo-Iweala is best placed to lead WTO, I make the case for the continent more broadly as to how and why it must get a better deal in the world trading system.”
READ: WTO accepts nomination of Okonjo-Iweala as DG despite opposition from Egypt
What this means
If finally selected for the top job, the opportunity will present Dr. Okonjo the platform to solve some global trade-related issues, one of which is Africa’s trade position with the rest of the world.
Economy & Politics
Buhari in crucial meeting with Obasanjo, other former heads of state
President Buhari is presiding over a National Security Council meeting with some former heads of state and some security chiefs.
President Muhammadu Buhari is currently presiding over a National Security Council meeting with some former heads of state and some security chiefs.
READ: Obasanjo opens garment factory, competes with Nike Art Gallery, Sam & Sara
Although the agenda of the meeting is not made public, issues bothering on the current security situation in the country are believed to top the agenda. This follows the outbreak of violence across the country during the protest against police brutality and extra-judicial killings, which has led to the loss of lives and destruction of public assets and private properties.
READ: Update: Buhari seeks power to freeze accounts, clamp down on money launderers
According to media reports, the meeting which is coordinated from the Council Chamber of the Presidential Villa, Abuja, has in virtual attendance General Yakubu Gowon (rtd.), former President Olusegun Obasanjo, Gen Abdulsalami Abubakar (rtd.), former President Goodluck Jonathan and former head of interim national government, Chief Ernest Shonekan.
READ: #EndSARS: Feminist Coalition raise Cryptos worth $126,000
Others who are physically present at the council chambers are Vice President Yemi Osinbajo; National Security Adviser, Major General Babagana Monguno (rtd.); Chief of Defence Staff, General Gabriel Olanisakin; Inspector-General of Police, Mohammed Adamu; Director-General, Department of State Services, Yusuf Bichi; and Director-General, National Intelligence Agency, Ahmed Rufai, among others are attending with the President.
READ: #EndSARS: Buhari holds National Security Council meeting with Osinbajo, IGP, others
This meeting is coming a day after President Buhari’s national broadcast on the security situation in the country calling for an end to the #EndSARS protests as their voices have been loudly heard.
Explore Data on the Nairametrics Research Website
Details later…
Economy & Politics
Senatorial, State House of Assembly bye-elections postponed – INEC
Senatorial and State House of Assembly bye-elections slated to hold on October 31 in 11 states have been postponed by INEC.
The 6 Senatorial and 9 State House of Assembly bye-elections slated to hold on October 31 in 11 states of the Federation has been postponed by the Independent National Electoral Commission (INEC). The vacancies were as a result of death and resignation of previous members.
According to the statement issued by its National Commissioner & Chairman, Information and Voter Education, Festus Okoye Esq., INEC said the decision was taken after meeting with the 37 Resident Electoral Commissioners (RECs) on Thursday.
Breaking News: #INEC Postpones Bye Elections in 6 Senatorial Districts, 9 State Constituencies. pic.twitter.com/RWiUomBsC6
— INEC Nigeria (@inecnigeria) October 22, 2020
Though the commission did not categorically state the reason for the postponement, feelers are that it may not be unconnected with the raging #EndSARS protests across the nation.
Details shortly…
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