Contrary to expectations, the Federal Government has failed to carry out its planned sale of some of its stake in joint venture oil assets, the second year in a row.
This can be seen from the highlights of the 2020 Budget presented by the Minister of Finance, Budget and National Planning, Mrs Ahmed Zainab as it was not included as one of the sources for expected revenue.
According to the 2019 approved budget presentation, President Muhammadu Buhari had directed that immediate action should commence to restructure the JV oil assets. This, he said was to enable the reduction of shareholding to not less than 40% and that this exercise must be completed within the 2019 fiscal year, Punch reported.
“The overall revenue performance in 2018 is only 55 per cent of the target in the 2018 budget partly because some one-off items such as the N710bn from Oil Joint Venture Asset restructuring and N320bn from revision of the Oil Production Sharing Contract legislation/terms have yet to be actualised and have thus been rolled over to 2019.
“We have again reflected projected proceeds from oil assets ownership restructuring as revenues for transparency and monitoring. Expected funds have been earmarked to fund critical capital projects as this was not achieved in 2018,” the document read.
What you should know: In 2017, the President Buhari administration stated that it would reduce its stakes in JV oil assets, refineries and other downstream subsidiaries such as pipelines and depots in its Economic Recovery and Growth Plan.
The Nigerian upstream operational structure is essentially divided between JV onshore and shallow water with local oil firms and multinationals. It also entails Production Sharing Contract (PSC) between both parties in deepwater offshore, which has attracted enormous interests and massive involvement of International Oil Companies (IOC) over the years.
Ownership Structure of JVs: The JV between the Nigerian National Petroleum Corporation (NNPC) and Shell allows the NNPC to own 55% stake while the one between the NNPC and others like Chevron and ExxonMobile allows the NNPC to own 60% shareholding.
The JV contract requires the government and the other parties to contribute to the funding of the operations according to their stake in the partnership. However, the government has, over the years, been accused of failing abysmally to live up to this obligation. This has made it heavily indebted to the other parties.
Google threatens to remove its search engine from Australia due to media code
Google has threatened to remove its search engine from Australia due to the media code introduced by the government.
Google said that it will disable its search engine in Australia if the government proceeds with a media code that would force it and Facebook Inc to pay local media companies for sharing their content.
The code requires Google and Facebook to enter mandatory arbitration with media companies if they cannot reach an agreement over the value of their content within three months.
It also requires the platforms to give the news businesses 14 days’ notice of algorithm changes, and non-discrimination provisions have been put in place to stop the tech giants from taking retaliatory action such as removing content or punishing organisations that participate in the code.
Mel Silva, Google Australia and New Zealand VP told Australia’s Senate Economics Legislation Committee today that Google would shut off the search in Australia if the government’s proposed media bargaining code becomes law. According to her, “The code’s arbitration model with bias criteria presents an unmanageable financial and operational risk for Google”
Australia announced the legislation last month after an investigation found Alphabet Inc-owned Google and social media giant Facebook held too much market power in the media industry, a situation it said posed a potential threat to a well-functioning democracy.
Prime Minister of Australia, Scott Morrison said Australia would not respond to the threats as news media companies fired back at suggestions their content did not add value to the platforms. “Australia makes our rules for things you can do in Australia. That’s done in our Parliament. It’s done by our government, and that’s how things work here in Australia,” he said. “People who want to work with that, in Australia, you’re very welcome. But we don’t respond to threats.”
What you should know
- Google’s threats follow similar remarks made by Facebook Australia’s managing director, Will Easton in September, who announced plans to remove news articles from the social media’s main app if the media code is passed by Parliament.
- To avoid the operation of the code, Google and Facebook have no option but to cease linking to news altogether. If Google can’t reliably separate news results from other search results, then logically it may have to pull its entire search service from Australia.
- Google’s threat to limit its services in Australia came just hours after the internet giant reached a content-payment deal with some French news publishers.
- This new media code will affect millions of Australians who use Google Search and Facebook every month.
Flour Mills moves to diversify funding sources with N29.8 billion bond listing
Flour Mills Nigeria Plc lists N29.8 billion bonds to diversify funding sources from the Nigerian capital market.
Flour Mills Nigeria Plc’s fresh N29.8 bond listing will help the nation’s leading food business company to explore diversified funding sources from the Nigerian capital market, with the hope of enhancing growth and the development of the company.
This statement was made by the Group Managing Director of FMN, Mr. Omoboyede Olusanya, at the listing of the Tranche A and Tranche B bonds valued at N29.8 billion on the Nigerian Stock Exchange (NSE).
The food and the agro-allied company which has remained Nigeria’s largest and oldest integrated agro-allied business with a broad profile and robust Pan-Africa distribution issued these bonds under its N70 billion Bond Issuance Programme.
Olusanya said that the company would continue to explore funding opportunities inherent in the capital market to ensure business growth and continuity.
While speaking about the Credit Rating of the Programme, he disclosed that FMN’s credit rating, as well as the operational financing of the Group, have improved considerably.
According to him, the bonds floated by Flour Mill will help to strengthen the company’s capital base and provide the needed working capital required by the Company. He added that Flour Mills Group will continue to deleverage and replace short term financing with longer-tenured and lower price funding to optimize capital structure and reduce financing cost.
He noted that Flour Mills will continue to explore opportunities to raise fundings via the capital market as this enables the company to diversify its funding sources and continue to play a role in the capital market as a significant player in it.
What they are saying
The Group Managing Director of FMN, Mr. Omoboyede Olusanya, at the virtual event, said;
- “We are delighted with the response from the market, we are happy to be listed.
- “We are introducing an N29.9 billion listing under an N70 billion bond issuance cover; we will continue to raise funding to diversify our funding sources.
- “The company remains passionate about feeding the nation to improve the quality of living for Nigerians through increased production and investments in backward integration.”
What you should know
- With the successful issuance of the new N29.8bn Tranche A and Bonds, FMN has utilized its bond issuance program registered in 2018.
- It is important to note that the Senior Unsecured bond listing includes an N4.89bn under Series 4 Tranche A of the bond issuance programme, at a 5.5% rate for 5 years, due by 2025, and a 25bn under Series 4 Tranche B of the same program at a 6.25% rate for a tenure of 7 years, due by 2027.
- The bond proceeds will be used to refinance existing debt obligations. It will also help the company take collaborative actions to diversify the company’s financing options beyond expensive short term debt.
COVID-19: Evidence suggests that new variants could pose challenge for vaccines
The research findings show that the new COVID variants may likely not respond well to the vaccines.
Recent research findings suggest that the new coronavirus variants would likely pose a big challenge for the vaccines, as revealed by studies by several medical researchers.
The new variant was first discovered in South Africa in October but has now been spread to more than a dozen countries all over the world.
According to the most recent findings, as reported by CNN, researchers took antibodies from six people who were hospitalized with Covid-19 before the new variant was discovered. They found to varying degrees, that the antibodies for all six of the survivors were unable to fully fight off the virus.
According to Alex Sigal, a virologist at the Africa Health Research Institute and the Max Planck Institute for Infection Biology, “I think the evidence is building that these mutations — and I think other mutations — will emerge across the globe — and are emerging already — that are escaping antibodies from previous infection. It’s concerning.”
According to Jesse Bloom, a virologist at the Fred Hutchinson Cancer Research Center, “When you see two groups independently arriving at same basic answer, that good — there’s more consonance that they are correct”
What you should know
- Sigal’s findings were very similar to those of a recent study by the National Institute for Communicable Diseases in South Africa.
- A research study has revealed that mutations in the new variant allowed them to evade some of the immunity induced by vaccination, but it was far from a complete escape.
- One thing that is critically safe for everyone is to get vaccinated, while the researchers are working to confirm whether these variants are dangerous or not to contain with the vaccines.
- According to Alex Sigal, “I would for sure get it if I could. My father-in-law had the opportunity to fly to Israel and get it, and I was shooing him out of the house because you can’t get it here in South Africa.”
- In a research study done at Rockefeller University, from a sample of 20 people who had received either the Moderna or the Pfizer vaccine, it was found that different mutations in the viruses did allow some escape from some types of antibodies, but the volunteers’ immune systems threw an army of different types of antibodies at the viruses.
- According to the research conducted in South Africa, blood was drawn from 44 people who had Covid-19 but the antibodies of about half of the 44 people were powerless against the new variant, while the other half, their antibody responses were weakened, but not totally knocked out.