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Business News

Oando signs 2 gas supply agreement with NLNG

The Group Chief Executive of Oando Plc, Wale Tinubu has reacted to the two gas supply agreements Oando and NLNG recently signed.

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Wale Tinubu, Group Chief Executive Officer, Oando Plc, Reclassification of Oando Plc as Low Price Stock, Oando’s gas deal with NLNG to increase Nigeria’s market share in LNG market, Oando becomes first oil & gas company in Nigeria to be ISO 27001 Certified

 

Oando Plc has notified the Nigerian Stock Exchange of a two gas supply agreement it signed with the Nigeria Liquefied Natural Gas Limited (NLNG) for the renewal of gas supply for the existing Trains 1-3 for a term of 10 years and for gas supply for the impending Train 7 for a term of 20 years.

The signing of the deal was chaired by the Group Managing Director, NNPC, Mele Kyari but was signed by the Managing Director, NLNG, Tony Attah; General Manager Commercial & Negotiations, NAOC, Massimiliano Bertona, who represented Managing Director of NAOC, Managing Director, Nigerian Petroleum Development Company (NPDC) – the exploration and production arm of NNPC, Alhaji Mansur Sambo and Oando boss, Wale Tinubu.

NNPC inks $1.16 million deal to deliver power project

Mele Kyari

Why it matters: Tinubu explained that the deal will assist the government in its quest to grow the reserves and boost Nigeria’s gas base. It will also increase the country’s market share in the global LNG market. He added that the deal shows the potential of local players as Oando is the only indigenous company party to the NLNG supply agreement.

Tinubu stated that Nigeria’s economy would be a benefactor, adding that, “The signing of these two agreements confirms and consolidates our long-term partnership with NLNG. Furthermore, it is a validation of NLNG’s confidence in our operational track record. The execution of the GSA is another positive stride in our journey to becoming the leading independent exploration and production company. Being a 20-year guaranteed income stream, it will strengthen our financial position as well as demonstrate to our key stakeholders the company’s growth potential.

“Finally by way of this agreement and in line with our increased focus on sustainability and social impact, the JV is closer to its objective of achieving zero gas flare in the immediate future. We will continue to collaborate with our partners and other stakeholders in finding creative solutions to move both the industry and economy forward.”

[READ MORE: International Volunteer Day – Oando Foundation renews commitment to adopted school through Art and…)

Highlights:

  • The Nigerian Agip Oil Company (NAOC) Joint Venture made up of the Nigerian National Petroleum Corporation, NNPC/NAOC/Oando has a total supply obligation of 850 million standard cubic feet per day (MMScfd) for Trains 1–6.  The Joint Venture (JV) is specifically responsible for supplying a daily contract quantity (DCQ) of 344.6MMscf/d for Trains 1-3 and 505MMscf/d for Trains 4-6, making the NAOC JV the second-largest gas supplier to NLNG. The first GSA is a renewal of the gas supply terms for Trains 1-3.
  • In addition to the JV’s current supply to trains 1-6 and under the terms of the second agreement, the JV will be responsible for supplying a DCQ of 294.7MMScf/d for Train 7.  Train 7 is expected to come on stream in 2024 and will bring the JV’s total supply obligation to 1.1 billion cubic feet daily (Bcfd). The execution of these agreements also effectively monetises about 3.3 trillion cubic feet (Tcf) of gas for the NAOC JV of which 666Bcf will be net to Oando.

Olalekan is a certified media practitioner from the Nigerian Institute of Journalism (NIJ). In the era of media convergence, Olalekan is a valuable asset, with ability to curate and broadcast news. His zeal to write was developed out of passion to shape people’s thought and opinion; serving as a guideline for their daily lives. Contact for tips: [email protected]

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    Economy & Politics

    Top States in Nigeria with highest IGR per population in 2020

    Nairametrics ranks the 36 states of the Federation, including the Federal Capital Territory, based on their IGR per population.

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    Nigeria’s states generated a sum of N1.31 trillion internally in 2020, representing a marginal decline compared to N1.33 trillion recorded in 2019, and an increase compared to N1.17 trillion in 2018.  

    The downturn is attributable to reduced state revenue as a result of disruptions caused by the covid-induced lockdown, while the crash in crude oil prices also hampered economic growth. 

    Internally generated revenue is regarded as income generated by various states in the country, independent of their share of revenue from the Federation account. However, apart from the clear exception of Lagos State, all others depend largely on statutory allocations to run their state affairs. 

    Nairametrics ranks the 36 states of the Federation, including the Federal Capital Territory, based on their IGR per population, taking into account the estimated population size of each state as at 2016 and 5% growth rate between 2016 and 2020.  

    Geo-political zones 

    In terms of IGR per population for the six geo-political zones in Nigeria, South West takes the lead with an average of N13,966, having generated a sum of N561.01 billion and an estimated population of 40.17 million people. The South-South region followed with an average of N8,694 and a total aggregate IGR of N263.17 billion.  

    On the flip side, the North-Eastern region, which houses states like Bauchi, Borno, Yobe, etc. recorded the lowest IGR per population of N2,061 closely followed by North West with an average of N2,855. 

    Here are the top 5 states with the highest IGR per population in 2020. 

    Lagos State – N31,794 

    Lagos State, regarded as the economic hub of the nation, with a total estimated population of 13.18 million people as of 2020generated a sum of N418.99 billion as IGR in 2020. This represents an increase of 5.1% compared to N398.73 billion recorded in 2019. 

    Hotflex
    • In terms of IGR per capita, Lagos State generated an average of N31,794 from each member of the population in 2020, as against N30,257 generated in the previous year. 
    • It is no surprise that Lagos State tops the rank, being a major epicentre for economic activities in the country. Lagos State is the largest city in Africa in terms of GDP, and the State is widely known for its large industries, with most corporations in the country headquartered within the state. 
    • It also houses major seaports in the country as well as the State Government’s aggressive taxation policies. These, amongst others, ensure the state makes more revenue internally compared to other states of the Federation. 
    • According to data obtained from the National Bureau of Statistics, Lagos State received a total of N115.93 billion as Federal allocation in the year 2020, representing 21.67% of the total revenue available to the state in the year. 
    • This shows the exceptional ability of the state to run its affairs, using its internally generated revenue with little or no support from the Federal purse. 

    Abuja – N24,600 

    The Federal Capital Territory generated a sum of N92.06 billion in 2020, the third-highest state IGR in the year. However, based on IGR per population Abuja seats in second position with an average of N24,600. 

    • This represents a 23.5% increase when compared to N19,925 recorded in 2019. 
    • Abuja is the capital territory of Nigeria, with a total estimated population of 3.74 million people across a 7,315km square area. 
    • The state houses a lot of Federal ministries, having been made the country’s capital in 1991. Abuja is also a major conference centre in the country, as it hosts various meetings and summits annually. 
    • A cursory look at the data showed that the state’s IGR only accounted for 57.85% of the total available revenue, indicating that 42.15% of its revenue was gotten from the Federation account. 

    Rivers State – N15,281 

    Rivers State, being a major oil-producing state in the country, generated a sum of N117.19 billion as internally generated revenue in 2020. 

    • However, with an estimated population of 7.7 million people, its IGR per population stood at N15,281 in 2020, representing a decline of 16.5% when compared to N18,307 recorded in 2019. 
    • Rivers State is in the Niger Delta region of the country with much of the businesses in the state being oil exploration companies. 
    • Evident from the data obtained from the NBS, Rivers State relies heavily on statutory allocations from the Federal Government as well as their share of the 13% oil derivatives as it received a total of N141.19 billion from FAAC, representing 54.64% of the total available revenue in the review period. 

    Delta State – N10,045 

    Delta state, another state in the Niger Delta region of the country, with an estimated population of 5.9 million, generated a sum of N59.73 billion as IGR, and an average of N10,045 as IGR per population. 

    • Delta State is a major oil-producing state and ranks second to Rivers State. The State supplies about 35% of Nigeria’s crude oil and some considerable amount of natural gas. 
    • Delta State in the period received a sum of N186.83 billion as statutory allocation. 
    • Its IGR only accounted for 24.2% of the available revenue in the period, while N46.11 billion was generated as PAYE. 

    Ogun State – N9,263 

    Ogun State, a neighbouring State of Lagos State, generated a sum of N50.75 billion. In terms of IGR per population, the State generated a sum of N9,263. 

    • The State’s average income per population decreased by 28.4% compared to N12,945 recorded in 2019. 
    •  The State is strategically located, bordered to the East by Ondo State, to the North by Oyo and Osun States, to the South by Lagos State and the Atlantic Ocean, and to the West by the Republic of Benin. 
    • Ogun State also joins the list of states that are much dependent on FAAC allocations as statutory payments stood at N37.7 billion, representing 42.61% of the total revenue. 

    Bottom five 

    Katsina – N1,386 

    Jigawa – N1,416 

    Jaiz bank

    Benue – N1,736 

    Niger – N1,804 

    Bauchi – N1,821 

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    Business News

    SpaceX says it’s pursuing necessary licenses to bring Starlink to Nigeria

    Broadband penetration of 70% which covers 90% of the population is the FG’s target in its National Broadband Plan (NNBP), 2020-2025.

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    Telecoms sector remains resilient as broadband subscriptions climb

    American private space exploration company founded by Elon Musk, SpaceX says it is working to pursue all necessary licenses needed to bring the Starlink Satellite internet services to Nigeria.

    This was disclosed by Mr Ryan Goodnight, SpaceX’s Starlink Market Access Director for Africa in a meeting with NCC’s Executive Vice-Chairman (EVC), Prof. Umar Danbatta on Friday in Abuja.

    What SpaceX is saying about Starlink in Nigeria

    “SpaceX has been in discussion with NCC virtually over the past several months to begin the process of pursuing all necessary licences to bring Starlink, its satellite-based broadband services, to Nigeria.

    Having made substantial progress in the discussion, the commission granted SpaceX’s request for a face-to-face discussion to gain better insights on the prospects,” they said.

    The NCC stated that it has listened to SpaceX’s presentation and will review it vis-à-vis its regulatory direction of ensuring an effective and sustainable telecoms ecosystem where a licensee’s operational model does not dampen healthy competition among other licensees.

    “As the regulator of a highly dynamic sector in Nigeria, the commission is conscious of the need to ensure that our regulatory actions are anchored on national interest,” they said.

    NCC added that broadband penetration of 70% which covers 90% of the population is the FG’s target in its National Broadband Plan (NNBP), 2020-2025. This is also in line with its National Digital Economy Policy and Strategy (NDEPS), 2010-2030.

    What you should know

    Starlink is an internet service launched by SpaceX to improve internet coverage in rural and underserved areas globally. Starlink satellites are over 60 times closer to Earth than traditional satellites, resulting in lower latency and the ability to support services typically not possible with traditional satellite internet.

    Nairametrics also reported this month that the  Federal Government announced a deal with Microsoft through the Federal Ministry of Communications and Digital Economy for the development of high-speed internet infrastructure across the six regions in the country.

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