Seplat's Activities Impacting Nigeria's Economy, Domestic Gas Supply

JUNE 2019 VOL.2 NO.4 www.tbiafrica.com N500, $20, £10 OB3, AKK PIPELINES: ECONOMIC BARU: A TRANSFORMATIONAL PROJECTS – OILSERV BOSS TRANSFORMATIONAL 9TH NATIONAL ASSEMBLY: WHAT HOPE FOR NIGERIANS? ACHIEVER AND REFORMIST

SEPLAT’S ACTIVITIES IMPACTING NIGERIA’S ECONOMY, DOMESTIC GAS SUPPLY DRIVING 30% OF ELECTRICITY GENERATION Energy JUNE 2019

2 Energy JUNE 2019 Editor’s Note temporaries. Its operational and safety recently said the nation’s inflation rate standards align with international best increased to 11.40 per cent in May from practices, hence it wasn’t difficult for 11.37 per cent recorded in April, adding the management to take it to local and that the figure was 0.03 per cent higher international capital markets. Today, Se- than the rate recorded in April 2019. plat is the only Nigerian company fully Traffic gridlock in Lagos has become listed on both the Nigerian and London nightmarish and it gets worse by the Stock Exchanges. day as a result of heavy downpour. The Company has continued to strive Will the administration of Babajide to increase reserves and outputs from Sanwo-Olu walk the talk, or will it end its oil and gas blocks. Through its like the toothless bulldog that barks strategic implementation of redevel- without biting? opment work programme and drilling DR. NJIDEKA KELLEY In our political economy column, we campaign, the Company has been able looked at the expectations of Nigerian eplat Petroleum Development to grow production from mere 14,000 from members of the 9th National As- Company Plc has distinguished barrels of oil per day (bopd) to over sembly, highlighting the achievements itself as an outstanding and con- 84,000 bopd. and failures of the 8th Assembly. sistent Nigerian Independent As a responsible corporate entity, Seplat SExploration and Production Company. On the lighter mood, we brought to you answered national call by the Federal how to make your relationship work by Since its establishment in 2009, it has Government to support gas-to-power been in the forefront of promoting making you sexual life more romantic project to take Nigeria out of darkness. and ways to build your self-confidence. natural gas supply for domestic usage The company responded by investing especially to the power sector to boost in the installation of dedicated gas All these and other informative reports electricity supply to Nigerians even production and processing facilities, and discourses are packaged in this when the price was not anything near drilling of gas production wells to edition for your consumption. international market value. meet domestic supply obligations and TBI Africa team welcomes you to the Currently, gas supply from its assets to provide feedstock to power projects 2019 Nigeria Oil and Gas Conference the power sector accounts for 30 per that will help increase Nigeria’s power and Exhibition in Abuja. We wish all cent of Nigeria’s electricity generation. generation capacity. It is in recognition the participants fruitful deliberations. Besides, it has continued to contribute of these contributions to national de- Remember to network well, make new to the development of the economy velopment that TBI Africa editorial team friends and business partners and for through various interventions in the chose to make Seplat our focus for this those visiting Abuja for the first time, education and health sectors, infra- month’s edition. endeavour to explore and enjoy the structure and human capital develop- Also in this edition is the rising con- Abuja hospitality. ment. cern about the increase in inflation The cerebral management team and and how it will affect Nigerians if left board of directors of the company unaddressed. The Central Bank of have, ever since the company’s emer- Nigeria (CBN), the apex regulatory body gence on the oil and gas industry, of banks, also recently expressed fears shown they are thoroughbred entre- that inflation rate may continue to rise preneurs. This underpinned Seplat’s marginally, noting that it will, therefore, current strong balance sheet and prof- continue to tight economic policies. The Dr. Njideka Kelley is also the owner itable production base with a balanced CBN said the country’s inflation may rise and Principal Consultant of mix of oil and gas. to 12 per cent this year before moderating. New Generation Consulting LLc, Its corporate governance practice 10101 Fondren Road stance stands it out among its con- The National Bureau of Statistics (NBS) Suite 353, Houston Texas 77076

PRINTED AND PUBLISHED BY: Syndicate Publications Limited (RC: 1368510) #1, Alhaji Shomade Alley Street, Obanikoro, Lagos Website: www.tbiafrica.com. Email: [email protected] Office Tel: 07089620095, 08057363319 EDITOR: Dr. Njideka Kelley, +17182194957, 07086167905. GRAPHIC ARTIST: Imekan Augustus 3 JUNE 2019 CONTENTS SEPLAT’S ACTIVITIES OB3, AKK PIPELINES: IMPACTING NIGERIA’S ECONOMIC ECONOMY, DOMESTIC GAS TRANSFORMATIONAL SUPPLY PROJECTS 5 – OILSERV BOSS BARU: A TRANSFORMATIONAL 51 ACHIEVER AND REFORMIST 10 HOW RISE IN INFLATION MAY AFFECT NIGERIANS 27 35 TRAFFIC GRIDLOCK: WILL EXECUTIVE ORDER DO THE MAGIC? 36 9TH NATIONAL ASSEMBLY: WHAT HOPE FOR NIGERIANS? 41 NIGERIAN AGRO SECTOR: GAPS, CONSTRAINTS AND HOW TO MAKE YOUR SEXUAL PROSPECTS 47 LIFE MORE ROMANTIC 56 4 JUNE 2019

SEPLAT’S ACTIVITIES IMPACTING NIGERIA’S ECONOMY, DOMESTIC GAS SUPPLY •DRIVING 30% OF ELECTRICITY GENERATION Seplat Petroleum Development Company Plc, a leading indigenous independent oil and gas producer, has been at the forefront of promoting natural gas supply for domestic usage especially to the power sector to boost electricity supply to Nigerians. It also contributes to development of the economy through interventions in the education, health sectors, infrastructure and human capital development. In this report, TBI Africa Team takes a holistic look at the company.

5 COVER STORY JUNE 2019

EPLAT is a leading independent SEPLAT is presently the only Nigerian The capital raised allowed SEPLAT to oil and gas producer in the prolific exploration and production (E&P) further implement the Company’s busi- company fully listed on the Nigerian Niger Delta region. It focuses on and London Stock Exchanges. In ness strategy including the acquisition maximising hydrocarbon produc- April 2014, Seplat completed the first of additional blocks. SEPLAT has a strong Stion from its existing assets, acquiring and ever dual listing on both the London reserve base and proven track record and Nigerian Stock Exchanges farming into new opportunities. of converting contingent resources to reserves. The management team has also Since the acquisition of its first blocks, achieved a consistent increase in gross oil mining leases (OMLs) 4, 38 and 41 operated oil production and boasts a and commencement of production in record of value-accretive acquisitions. 2010, the Company has increased oil and gas production and grown reserves in Since making its first acquisition in 2010, every year of operation and it is currently SEPLAT has risen to become a leading in- recognised as a leading Nigerian inde- digenous oil and gas operator in Nigeria. pendent oil and gas operator. Underpin- The Company has increased its produc- ning SEPLAT is a strong balance sheet completed the first ever dual listing on tion and reserves year-on-year and has and profitable production base with a both the London and Nigerian Stock consistently grown revenues and profits balanced mix of oil and gas. Most impor- Exchanges. since it commenced operations. tantly, its corporate governance practice The Company raised US$535 million in an is unrivaled among its contemporaries. Gross operated liquids production at initial public offering that ranked as the OMLs 4, 38 and 41 at the time of acqui- Its operational and safety standards align largest for a sub-Saharan Africa company with international best practices. sition was 14,000 barrels of oil per day since 2008 and the second largest ever (bopd) but through the implementa- SEPLAT is presently the only Nigerian ex- for a Nigerian company, demonstrating tion of a focused re-development work ploration and production (E&P) company the international investors’ appetite for programme and drilling campaign, the fully listed on the Nigerian and London the leading Nigerian oil firm. Company grew this to a peak rate of over Stock Exchanges. In April 2014, Seplat ” 84,000 bopd, representing a six-fold in-

•A B C Orjiako, 6 COVER STORY COVEREnergy STORY JUNE 2019 crease and significantly ahead of the peak rate achieved by the previous operator of approximately 56,000 bopd in 1996. Alongside its oil business, the Company has successfully established itself as the pre-eminent supplier of natural gas to the domestic market in Nigeria through substantial investments made in the commercialisation, development and moneti- sation of the substantial gas reserves that exist on its blocks. Whilst natural gas was commonly viewed as a by-product from oil production in previous years, SEPLAT was quick to see the opportunity of the increasing importance of natural gas as a key source of energy for Nigeria. The company has responded by investing in the installation of dedicated gas production and processing facilities and the drilling of gas production wells to meet domestic supply obligations and provide feedstock to power projects that will help increase Nigeria’s power generation capacity. Rather than being the by-product, natural gas for SEPLAT is a valuable primary commodity in its own right that •Austin Avuru will form a significant component of its The company has responded Alongside these majors is the rising by investing in the installation of the independents who have also come future growth and success in Nigeria. of dedicated gas production and processing facilities and the into existence and have continued to As Nigeria’s leading independent, SEPLAT drilling of gas production wells to grow in leaps and bounds, he said, noting works hard to ensure its business grows meet domestic supply obligations and provide feedstock to power the need for more significant investments and develops with wider economic and projects that will help increase Ni- geria’s power generation capacity in view of challenges such as importation social considerations at the forefront of of refined products and lack of access to everything it does. electricity despite huge crude and gas The need for reliable, affordable power reserves. is a vital step to achieve accelerated Okon added: “A lot of people in Africa still economic growth in Nigeria and we are do not have access to electricity. Lack of working hard to support its delivery. adequate infrastructure also still presents SEPLAT is the leading supplier of natural a problem. These challenges present gas to the domestic market and with the huge opportunities for gas development prolific natural gas reserves in Nigeria, and investment. As a result, a company it harnesses this opportunity to meet delivering around 400 million standard like SEPLAT has remained bullish with its growing demand and address the current cubic feet per day (MMscfd). In addition gas development. SEPLAT, with a strate- power supply deficit. to these, our Sapele Gas Plant upgrade gic location on the gas hub in the Niger and Assa North-Ohaji South (ANOH) Operations Director of SEPLAT, Mr. Effiong Delta, facilitates its gas development.” project is to add 315 MMscfd capacity by Okon, confirmed the company’s stance 2020.” According to him, the growing need for on gas development when he spoke at capital for emerging infrastructure such the Africa E&P Summit held in London He stated at the Summit that Africa is the as refining and transportation of petro- recently where he delivered a paper destination for gas development and leum commodities and products and the entitled “Oil and Gas Rising in Africa.” He investment. Africa is home to some of development of a robust petrochemical said currently, SEPLAT contributes about the world’s fastest growing economies, industry, place the continent at a vantage 30 per cent of domestic gas supply in some of them lifted by new oil and gas point for investments. Nigeria. discoveries. An estimated 7.5 per cent of global proven oil reserves (126.5 billion SEPLAT has always shown commitment He noted that given the huge opportuni- barrels) and 7.1 per cent of global proven to value creation for economic develop- ty in Nigeria, the company has continued gas reserves (487.8 trillion cubic feet) sit ment and its shareholders. At its recent to make significant investment of well in Africa. annual general meeting, the company over $300 million in growing its gas busi- unveiled its plans for expansion including ness resulting to its massive current daily He stressed that there has been abundant more acquisition to boost production and production capacity. discoveries” of oil and gas reserves, which achieve stronger growth as well as ensure have over the years attracted key interna- “SEPLAT current well stock is capable of capital appreciation for the benefits of the tional oil companies to the continent. shareholders. 7 COVER STORY JUNE 2019

As you are aware, our results from the previous two years were characterised by the extended period of force majeure at the Forcados terminal from February 2016 to June 2017

In its full year financial result ended December 31, 2018, SEPLAT recorded revenue of N228 billion, reflecting an increase of 65 per cent from the N137 billion the company made in the 2017. It also recorded profit before tax of N73 billion, indicating 480 per cent increase from N13 billion which the company made in 2017. Speaking at the Annual General Meeting (AGM), the Company’s Chairman, Dr. A.B.C. Orjiako, said: “The company’s 2018 operational and financial performance reflected the significantly higher year- on-year levels of production uptime at its core oil producing assets combined with a firmer, albeit still volatile, oil price and increased contribution from the company’s gas business.” “Our plan for acquisition of plant to grow “SEPLAT remains an ambitious evidenced by our continual deleveraging organically is still on course. Once we are growth-orientated company that is in a of our debt levels to the current balance able to get valuable asset to acquire, we position of strength to capture inorganic of US$350million. will go for it. opportunities where we can leverage our competitive advantages to seek out “In 2018, we reinstated the dividend, in- “As you are aware, our results from the carefully considered, price disciplined and creased capital investments and with the previous two years were characterised value accretive acquisitions.” resources and headroom in our capital by the extended period of force majeure structure, we are equipped to capitalise at the Forcados terminal from February For the Chief Executive Officer of SEPLAT, on organic and inorganic growth oppor- 2016 to June 2017. As we enter 2019, our Mr. Austin Avuru: “SEPLAT has delivered tunities as they may arise.” an excellent operational and financial per- reliable production base, low unit cost of Besides FID for the ANOH project, which production and discretion over capital formance resulting in robust profitability and cash flow generation providing us its Phase I on completion will process commitments will allow the business to 300 MMscfd gas with accommodation remain highly free cash flow generative with an extremely solid foundation for growth in the coming years. space for future expansion, Avuru said and profitable. the Amukpe to Escravos alternate export “In the absence of any major interruption “At our core assets in the West, OMLs 4, pipeline, which is nearing completion is or force majeure event, this will enable 38 and 41, the extension of the licence to expected to be fully commissioned and SEPLAT to honour its dividend policy and 2038 means that we can confidently plan operational in second quarter of this year. provide an attractive yield to our share- and invest long into the future to realise the full potential of those blocks.” The project will ramp up to initial per- holders in addition to the potential for mitted capacity of 40,000 barrels per capital appreciation.” “As we continue to enhance production day during the third quarter of this year, Orjiako also stated that the company will and revenue diversification with new he said, adding that: “Access to three selectively invest in low risk oil production wells scheduled at OML 53 in the East, the separate export routes at our western drilling opportunities within the existing board took the Final Investment Decision assets and two at our eastern assets portfolio and the continued expansion of (FID) to invest in the large scale ANOH gas providing adequate redundant capacity the gas business, with 2019 set to be the and condensate development which will will significantly de-risk distribution of oil year that activity intensifies at the large form the next phase of transformational production to market.” growth for our gas business. scale Assa-North and Ohaji-South (ANOH) Giving back to society gas and condensate development. “Disciplined capital allocation continues to remain at the core of our activities SEPLAT has social investment pro- 8 COVER STORY COVEREnergy STORY JUNE 2019

SEPLAT has structured internship programmes for talented, enthusiastic, ambitious students and those who are carrying out National Service

Development Committee (CDC), also referred to as the Host Communities Forum (HCF), has been established and is comprised of representatives from each host community. The CDC/HCF is responsible for coordinat- ing the implementation of the social investment programmes funded by SEPLAT and identified by the CDC/HCF, with a view to invest in areas that align SEPLAT’s business objectives with local priorities whilst addressing broader development objectives. This process involves transparent communication with all local stakeholders and ensures multi-party engagement between the Company, community, civil-society groups and government. SEPLAT is strongly committed social and environmental” values as reflected grammes which include healthcare, edu- targeted at the socio-economic develop- in its rigorous approach to performance cation, economic empowerment/capacity ment of communities in its operational assessment, measurement and eval- building, infrastructure development and areas. uation across its four core CSR pillars environmental stewardship initiatives. - local stakeholder engagement, health, According to the Company’s General safety; environmental rigour, employee SEPLAT through various corporate social Manager, External Affairs & Communica- effectiveness; and business and ethics responsibility (CSR) programmes positive- tions, Dr. Chioma Nwachuku, the Eye Can conduct. ly impact the society. In the health sector See and Safe Motherhood CSR Pro- through the NNPC/SEPLAT Joint Venture grammes started in 2012 in the Western Capacity development has Eye Can See and Safe Motherhood Assets operational area, comprising Edo/ SEPLAT has structured internship signature. The programmes are for Delta States from where it was extended programmes for talented, enthusiastic, communities situated in its Eastern and to the Eastern Assets operational area in ambitious students and those who Western Assets operational areas. Imo State. are carrying out National Service. “We For the Eye Can See programme, benefi- Nwachuku assured that both health pro- take great pride in offering the bright- ciaries had their eyes tested, receive pre- grammes are in alignment with the Unit- est young minds a chance to develop scribed glasses and some had surgeries ed Nations (UN) Sustainable Developing professionally and to apply their skills in for cataract related visual impairments. Goals (SDG) 3 which is to “Ensure healthy a supportive environment,” the manage- lives and promote well-being for all.” ment said. The Safe Motherhood programme whose beneficiaries are mostly pregnant women The company signed a Global Memoran- The company also conducts a yearly aca- and nursing mothers, had mothers re- dum of Understanding (GMoU) with the demic quiz entitled ‘Pearls Quiz Compe- ceive lectures on danger signs of preg- host communities where its oil blocks, tition’ for secondary schools. The school nancy and nutrition in pregnancy. The OMLs 4, 38 and 41, are located. It was the that emerges tops goes home with a star beneficiaries are also presented with Safe Company’s first community development prize of cash that runs into millions of Motherhood kits made up of a maternity agreement signed between the Compa- naira and sometimes with other prizes bag, vitamin supplements, treated mos- ny and its local stakeholders. The GMoU such as buses while second and third quito nets and all medical items required provides a framework within which the place winners also go home with prizes. for safe delivery. Company and its host communities can SEPLAT, over the years, has also contin- work together to support wider sustain- ued to award scholarships to undergrad- Avuru assured that the Company is firmly able community development. Under uates students in its operational areas. committed to sustaining the CSR health the terms of the GMoU, a Community programmes and other programmes 9 JUNE 2019

BARU: A TRANSFORMATIONAL ACHIEVER AND REFORMIST By Abisola Thompson ter of State for Petroleum Resources. the lack of transparency and massive corruption in the Corporation prior to e looks calm and unassuming On resumption, he made it clear that he his appointment. but behind this gentlemanli- was not a stranger to the oil sector and ness is a though man who is the attendant challenges. Although, Fully prepared to change the narra- patriotic to development and he met a Corporation faced with many tives of the Corporation, he unveiled a Hgrowth of his fatherland. The outgoing challenges but did not allow that to 12-point agenda designed to cleanse Group Managing Director, Nigerian Na- deter him from making his positive the Augean stable and reinvigorate the tional Petroleum Corporation (NNPC), contributions to the industry. NNPC. Dr Maikanti Buru, came on board on It would be recalled that the Nigerian The 12-point agenda include the cre- July 4, 2016 when he succeeded Dr Ibe Extractive Industries Transparency Ini- ation of an all-inclusive internal adviso- Kachikwu who doubled as the Group tiative (NEITI) had raised an alarm about ry council on security comprising repre- Managing Director of NNPC and Minis- 10 ENERGYEnergy JUNE 2019 The NNPC boss listed some of the sentatives from NNPC, international oil We also believe that the award achievements recorded under his watch companies (IOCs), labour unions and would spur you to greater to include maintaining production security operatives. The council was heights in your quest to reposition the NNPC and bring it to levels well above two million barrels created to brainstorm and address host global acclaim in the service of per day; increasing crude oil production community agitations, implementation Nigeria and humanity by NNPC flagship upstream Company of new business models to grant need- - the Nigerian Petroleum Development ed autonomy to the strategic business Company (NPDC). units and autonomous business units within the Corporation. The council The Corporation under his watch en- was mandated to provide direction and sured a boost in gas production to the control to ensure the national oil firm’s extent that currently, NNPC is the larg- growth and profitability. est supplier of gas to power and saving enormous financial resources through Forbes Best of Africa Oil & Gas award- Direct Sale Direct Purchase (DSDP) ed him “The Man of the Year” prize in the Nigerian Academy of Engineering scheme adopted for products import. recognition of his patriotic service to (NAE), held at the University of Lagos Nigeria and his efforts to reposition the recently, Baru attributed the successes Others include ridding government Corporation. According to Forbes, the to his engineering background and dis- of huge financial commitments on award was based on his rising profile cipline, which wholesomely prepared cash call commitment by developing and impressive career path through the him for the great task ahead. workable alternative funding arrange- years. In his presentation entitled “The jour- ments; devising sustainable teamwork between the oil and gas industry and “For these and other landmark achieve- ney so far,” Baru said studying Engineer- the numerous host communities in the ments which you have recorded ing prepared him for life and living. Also Niger Delta region. This, he noted, was throughout your enviable career, your on being the helmsman of NNPC, he to curb security challenges that had nomination for this Prestigious Forbes enumerated those landmark progress dipped crude oil production some years 2017 Award has been approved by recorded in the last three years. back and instituting a regime of trans- Forbes Custom’s Award Committee. According to him, engineering as a parent contracting/bidding processes “We also believe that the award would branch of study tasks the brains and in all major projects. spur you to greater heights in your whets one’s ability for logical thinking His management, according to him, quest to reposition the NNPC and bring and problem-solving thus challenging the creative” instinct to solve existen- also reduced cost of crude oil produc- it to global acclaim in the service of tion per barrel in the country from $27 Nigeria and humanity,” Forbes stated. tial problems and relieve humanity of drudgery. to $22; explored opportunities in fron- Speaking at his investiture as Fellow of tier basins to boost Nigeria’s reserves

11 ENERGY JUNE 2019 base and production. The Corporation also sustained petroleum products supply nationwide and kick-started the current holistic rehabilitation of the nation’s four refineries to boost capacity utilization. Fielding questions on his recent retirement from the services of the NNPC with effect from July 7, 2019, the NNPC chief expressed gratitude to God for seeing him through a glorious career at the Corporation, noting that even after retirement he was willing to do more if called upon to serve the country. Baru was born on July 7, 1959 and hails from Jama’are in Bauchi State, north- east Nigeria, but grew up in Jos, Plateau State. He is a Fellow of the Nigerian Academy of Engineering and a Fellow of the Nigerian Society of Engineers. He is married with children. He attended Ahmadu Bello University, Zaria, where he obtained Bachelor of Engineering (Mechanical) with first class honours. He also holds a Doctor of Philosophy in Mechanical Engineering. Before his appointment as the Group Managing Director, he was the Group Executive Director, Exploration and Production of the Corporation. He also worked in various capacities in both the upstream and downstream arms of NNPC. These include Group General Manager of Greenfield Refinery Proj- ects, Managing Director of Hyson, Exec- Several other ongoing projects his fatherland, Baru said: “Service to Ni- utive Director of Nigerian Gas Company were also conceptualized (NGC), General Manager, Gas Division under his care. He planned the geria is everybody’s call. Every Nigerian of NAPIMS, Manager – Operations, projects that aimed at ensuring should be willing to serve the country flare-out by 2008 and made when called upon to do so. Procurement Management Services huge savings while overseeing and Manager, Engineering for National the Joint Venture Gas Projects “The system that has been put in place Engineering and Technical Company is for a public servant to retire when he Limited (NETCO). is 60 years or after 35 years in service. During his stint with NAPIMS which However, if it is the prerogative of Pres- spanned July 1993 to July 1999, Baru ident Muhammadu Buhari to invite you executed several gas projects which still to do more, of course you should look utilize billions of standard cubic feet of at it and you should do more. The Pres- gas per day. ident graciously accepted my statutory retirement but if he says I should come Several other ongoing projects were 2004. and do more, I’m willing to serve.” also conceptualized under his care. Baru has been the Chairman of NNPC He planned the projects that aimed at President Muhammadu Buhari appoint- anti-corruption committee since ensuring flare-out by 2008 and made ed Mele Kolo Kyari as the new group September 2004 till date; and has huge savings while overseeing the managing director of the NNPC. Kyari is relentlessly sensitized members of staff Joint Venture Gas Projects. from Borno State and he becomes the on obligations and laws that govern 19th Group Managing D of the NNPC He was also the NNPC’s Chief Technical corruption and corrupt practices. with a rich profile of professional and Negotiator on the West African Gas On whether, if called upon to still serve service credentials. Pipeline project from July 1999 to April ” 12 ENERGY ENERGYEnergy JUNE 2019 SHELL SEEKS STAKEHOLDERS’ SUPPORT TO CURB OIL PIPELINE VANDALISM …LOSES 11,000 BOPD TO CRUDE THEFT IN 2018 Towards the UNEP Report-guided Ogoni Clean Up, Weli said: “SPDC actively supports the clean-up process along with other stakeholders. SPDC remains fully committed to providing its share of $900 million (N283.73 billion) over five years to the Ogoni Trust Fund as stipulated in the Hydrocarbon Pollution Remediation Project (HYPREP) gazette and the agreed governance framework.” “The SPDC JV has completed its first-year contribution of $180 million (N54.54 billion). Early 2017, the SPDC JV made available $10 million to help set up HYPREP office and in July 2018, joint venture deposited additional $170 million (N51.52 billion) into an escrow account to fund HYPREP’s activities.” The company said it is also collaborating with By Abisola THOMPSON ments work programmes to appraise condi- communities to effectively patrol pipelines’ tion of, maintain and replace key sections of hell Nigeria has called for stakeholders’ rights-of-way through direct surveillance and pipelines and flowlines. In 2018, for example, concerted efforts to curb the inces- GMoU surveillance, proactively engaging we installed 70 kilometres of pipelines and sant vandalism of crude oil-bearing government security agencies to prevent 188 kilometres of flowlines. Over the last seven pipelines, highlighting the danger of crude theft and vandalism and carrying out years, SPDC has replaced approximately 1,300 Scontinuous sabotage to people and environ- awareness campaigns to educate com- kilometres distance of flow lines and pipelines.” ment. munity members, surveillance contractors She said: “In line with industry regulations, and general public of the requirements of The General Manager, External Relations of SPDC only pays compensation if the spill is the 1990 Pipeline Act which prohibits any the Shell Petroleum Development Company operational.” third-party activities 100ft from existing oil (SPDC), Mr. Igo Weli, said such efforts to curb and gas right-of-way. pipeline sabotage will save lives, secure communities and protect the environment. NECONDE SECURES OVER N230B REFINANCING Weli spoke on Pipelines Right of Way DEAL TO DRIVE OIL PRODUCTION Encroachment and Vandalism. “Shell is By Meletus EZE Bank (UK) Limited. The international lenders are the Africa Import Export Bank (Afrexim), concerned the repeated sabotage of recently consortium of seven local and Africa Finance Corporation (AFC), and Glen- repaired pipelines exposes the environment international lenders has signed an core Energy (UK) Limited. and people to renewed and worsening agreement to refinance Neconde pollution. Oil theft is focused on short term Energy Limited’s existing Senior Apart from being a member of the lending fiscal benefits, ignoring the long-term effects ASecured Medium-Term Loan Facility Agree- consortium, Glencore is also the off-taker of of environmental degradation. ment worth $640 million over (230 billion) , Neconde’s equity crude oil production. following a 20-year renewal of its Oil Mining “Since 2017, sabotage spill rate has risen steep- With the refinancing, Neconde, accord- Licence (OML), effective June 2019. ly and crude oil theft from SPDC JV’s pipeline ing to a statement from the firm, is now network averaged 11,000 barrels of oil per day Neconde is in a Joint Venture (JV) with the positioned to achieve its field development (bopd) in 2018, an increase of about 20% over Nigerian Petroleum Development Compa- plans for the Asset. previous year. The number of sabotage-relat- ny (NPDC) in OML 42. The JV’s Production The Chairman of Neconde Energy Limited, ed spills increased in 2018 to 111 compared to presently stands at an average of 50,000 Dr. Ernest Azudialu-Obiejesi, said in a state- 62 in 2017 and, since 2012, SPDC has removed barrels per day (bpd), and upon complement that the loan refinancing affirms the more than 1,160 illegal theft points.” tion of the development activities planned company’s strong financial fundamentals as in the 2019 work programme; output is Also speaking at the workshop, Shell’s General a leading player in the upstream oil and gas expected to hit about 100,000bpd. Manager, Safety and Environment, Chidube industry. Nnene-Anochie, said irrespective of the cause, The consortium of seven lenders is made He also disclosed that “this restructuring SPDC cleans and remediates areas impacted up of four Nigerian banks and three inter- frees up capital for Neconde to invest in by spills from its facilities.” national lenders. They include Access Bank, more development activities that will result Fidelity Bank, Zenith Bank as well as First According to Nnene-Anochie, “SPDC imple- in production increase.” 13 ENERGY JUNE 2019

CONSUMERS’ LONG, TIRING WAIT FOR PREPAID METERS Amadi’s argument reiterates one of the •MAPS AS FAILING SCHEME? reasons why consumers have been pushing The Nigerian Electricity Regulatory back any form of tariff increase, especially Commission (NERC) introduced In a series of tweets, Amadi said the priva- when previous increments have yet to result the meter asset providers (MAPs) tisation process could not produce the de- in improved electricity supply. regulation scheme to fast-track sired results because the power assets were With no less than 4,606,106 electricity the roll-out of meters through the sold to investors who lacked the financial consumers lacking meters, there are engagement of third-party investors and technical capacity. reservations about the implementation of and end estimated billing. The The sector was privatised after the un- the meter asset providers (MAPs) scheme, commission had issued permits to bundling of the Power Holding Company which was kicked off on May 1, as many licensed firms to begin massive roll- of Nigeria (PHCN) in November 2013, as households remain ignorant of the procure- out of new meters by May 1. Several private investors took over distribution and ment process. weeks after, consumers’ anxiety about generation firms “to ensure an adequate, the scheme continues to wane as Indeed, the Nigerian Electricity Regulatory regular and stable supply of electricity to Commission (NERC), had issued permits to many distribution companies drag the consumer at a reasonable cost”. implementation despite the will to pay meter asset providers (MAPs), to begin the for meters, Olamilekan FAWAS write. “The power sector was designed to fail. We rollout of new meters by May 1, as part of failed to corporatise and commercialize measures to address issues of estimated any conclusions, arguments before privatizing; we privatize senselessly billing by distribution companies. or positions about the ineffi- without paying attention to context and Many consumers, despite willing to pay ciency in the Nigerian power corporate governance and regulatory for the meters are yet to be provided with sector oftentimes refer to the regime; we sold to investors who lacked meters several weeks after. Mfaulty process in the initial unbundling of capacity,” he said. The MAP regulation the sector through the privatisation of the Amadi argued that the challenges in the Power Holding Company of Nigeria (PHCN) sector go beyond tariff increase as such The MAP Regulation was unveiled in March in November 2013. move would force manufacturers off last year, with the aim of fast-tracking the The former Chairman of the Nigerian the grid. “Cost-reflective is important but roll-out of meters through the engagement Electricity Regulatory Commission (NERC), excessive tariff hike is problematic because of third-party investors for the financing, Dr Sam Amadi, reiterated the point saying it cannot be collected and in a country with procurement, supply, installation, and main- the privatisation of the power sector was poor supply because the propensity to pay tenance of electricity meters. designed to fail. is low,” he said. It introduced a new set of service providers 14 ENERGY ENERGYEnergy JUNE 2019 in the power sector, called meter asset providers, to assist the distribution companies in bridging the huge metering gap in the Nigerian electricity supply industry. According to the regulation, the distribution licensees (Discos) and the MAPs shall enter into a metering service agreement, which shall provide for the number of meters to be installed in the distribution licensee’s network over an agreed period and the recovery of the cost of meter asset plus a reasonable return over a period of 10 years, among others. But the procurement process for the MAPs was delayed, with the regulator saying in late March that it was reviewing the MAP procurement reports. NERC said in April that permits had been issued to the MAPs engaged by eight out receive the meters he paid for, months after now have not been given to them,” the of the 11 Discos, adding that the rollout of paying more than the required cost. President, Electricity Consumers Association of Nigeria, Chijioke James, said recently. meters would commence no later than May For Eko Distribution Company, the pace 1, 2019. remains equally slow, as residents lament He said, “One week into the deadline given The electricity distribution companies compliance with the regulation and various by the regulator, the situation seems not to (DisCos) are Abuja Electricity Distribution service agreements by the MAP and elec- have changed. So, it behoves on the regu- Company Plc, Jos Electricity Distribution tricity distribution licensees. lator to ensure that all stakeholders comply with that regulation. It ought not just to Company Plc, Ikeja Electricity Distribution IEDC appointed Mojec International bark, but also bite; that way, we can have Company, Benin Electricity Distribution Limited- (399,790 meters), Consolidated sanity in the sector. Company, Port Harcourt Electricity Dis- Infrastructure Group Ltd- (397,922 meters) tribution Plc, Yola Electricity Distribution and New Hamshire Capital Ltd-(276,699 “Our take is that the regulator should Company Plc, Enugu Electricity Distribution meters) respectively within the Ikeja Disco wake up and hold the power distributors Company Plc, and Ibadan Electricity Distri- franchise under MAP. accountable to the consumers. Consumers bution Company Plc. are beginning to lose confidence in both Acting Chief Commercial Officer, IEDC, the regulator and the Discos. Not until we DisCos’ progress on MAP and endless wait Ugochukwu Obi-Chukwu, at a forum see improved services, we are not going to for meters recently, said the NERC mandate was for take the regular and the Discos seriously.” Though the Commission directed that the every Disco to meter all consumers under rollout of meters shall commence no later its network, saying Ikeja DisCo was all out to Coordinator of Electricity Consumer Advo- than the 1st of May 2019, implementation is carry out the effective implementation of cacy Network, Akeem Balogun, expressed far from reality. the directive. doubts that MAP would be able to resolve the issue of estimated billing and cover He disclosed that the target of Ikeja Electric In Lagos, consumers under the Ikeja Elec- the metering gap, as NERC regulation only was to meter about 30,000 consumers tricity Distribution Company (IEDC) have encourages customers to procure a meter monthly which will be in phases, starting lamented the slow pace of the company in from a third party at their own expense. implementing the MAP scheme even when with customers under Shomolu, Abule-Eg- they were willing to pay for the meter. ba and Ikorodu Business Units. He further noted that if the government wants the regulation to work, financiers According to him, the deployment and Some of the consumers said the company should be provided for DisCos or allow installation of prepaid meters to customers preferred to issue pre-paid meters to house- them to source for their own financiers in Ikorodu, which will be carried out by one holds with existing debts so that recovery instead of allowing customers to procure of its MAPs, New Hampshire Capital limited, could be easily done when credit units are themselves. procured, adding that for other households will commence on June 17, 2019, following without debts, accessing pre-paid meters the successful registration and subscription Balogun added that the cost of meters has become a racket for which residents pay for meters by thousands of customers which has been added to the current tariff up to N100,000 to fast-track the issuance spread across Ikorodu and Epe. is like double charging customers, adding that even though people are clamouring se- of three-phase meters that shouldn’t cost “The meter rollout was supposed to start riously for meters, the cost of about 38,000 N67,055.85 according to NERC guidelines. on May 1, 2019. But it has not. There have for a single-phase meter is too expensive been a lot of complaints from our members One of the consumers who preferred to be for most Nigerians considering the current across the country. They complained that identified simply as Mr Aremu under Sho- economic situation. molu Business Unit noted that he has yet to even the meters that were paid for before 15 ENERGY JUNE 2019 activities which involve spraying of chemicals to preserve food items have worsened air pollution in most cities. These activities, he said are increasing cases of acid rain, various health conditions like heart failure, pulmonary diseases, asthma, skin diseases, and lung cancer. He stressed STAKEHOLDERS that to save the world from the malaise, the alternative solution is the use of renewable energy. CANVASS Contributing, the Chairman, Manufacturer Association of Nigeria (MAN), Ikeja Chapter, SUPPORT FOR Francis Meshioye, said although renewable energy is a proficient source of generating power, there was the need to reconsider RENEWABLE factors such as the cost, its installation and educating the people who already have a ENERGY misconceived mindset about it. Also, speaking, the General Manager, Lagos State Consumer Protection Agency (LASCO- TO TACKLE PA), Mrs. Oluwakemi Olugbode, advocated more awareness on the potential for solar as alternative solution and strengthening of law POLLUTION enforcement in order to address complaints on fake products from renewable energy producers. “In Nigeria and Africa, there is limited knowl- By Aliyu DANALDI Ayodele, an engineer, lamented that over edge of solar. Although we haven’t received time, the man-made sources of air pollution o mitigate the effects of air pollution, complaints in that regard but the federal and have been vehicular emissions, burning of state government must ensure that renew- experts have called for the use of fossil fuel, waste from landfills, generator ex- renewable energy solutions. able energy products comply with the Stan- hausts, bush burning and other agricultural dard Organisation of Nigeria’s regulations. TThey noted that governments, industries, communities, and individuals should come together and explore renewable ‘DIASPORA REMITTANCE EXCEEDS energy and green technologies to improve air quality in the society. 2018 OIL, GAS EARNINGS’ Shile GIWA remained Nigeria’s biggest export. The experts spoke during an event organised by the Lagos State Environmental Protection he Chief Executive Officer of Seplat Quoting the National Bureau of Statistics Agency (LASEPA), to mark the 2019 World Petroleum Development Company (NBS), Avuru said the Bureau had two weeks Environmental Day. Plc, Mr. Austin Avuru, has said diaspo- ago disclosed in its report that for the full year ra remittances by Nigerians in 2018 2018, diaspora remittances for the first time Leading the call, the President of Renewable surpassedT earnings from oil and gas last year. exceeded Federal Government’s earnings Energy Association of Nigeria (REAN), Segun from oil and gas sector. Adaju, said research has proven that renew- Avuru spoke at the Nigerian-American able technology is affordable in meeting Multicultural Council (NAMC) 8th Annual The PwC’s Chief Economist, in a report commitment required from it especially in gala night held in Houston, Texas, where titled: Nigeria Economic Outlook: Top 10 addressing the problems of air pollution, he bagged the Honorary Gala Chair and Themes For 2019, noted that remittances which have become so rampant in Nigerian Lifetime Achievement Awardee. to Nigeria represent 6.1 per cent of Gross cities. According to him, Nigerians in diaspora in Domestic Product (GDP), and translate to 83 per cent of the Federal Government’s Adaju said in terms of sustainability, renew- 2017 had remitted S22 billion, making it the budget of last year. able energy sources such as, the sun, wind, highest in sub-Saharan Africa followed by electrostatic, and others are generated in Senegal and Ghana with $2.2 billion each in On the other hand, statistics from the a manner that transcend generations yet the same year. Currently, the country is in the Central Bank of Nigeria (CBN), indicated unborn. top five nations in global remittances. that Nigeria earned N5.54 trillion from the petroleum industry in 2018, amounting to “Individuals need to develop a business Also, the Chief Economist at Pricewater- 60.88 per cent of the N9.1 trillion budget model that would work for them to be able houseCoopers (PwC) Nigeria, Prof Andrew for the 2018 fiscal year and 63.45 per cent to pay in a bit as well as own renewable Nevin, had said Nigerian citizens living of the N8.73 trillion proposed budget for energy products”, he said. outside the country remitted an estimated inflow of $25 billion last year, saying they 2019. The General Manager of LASEPA, Antonio 16 ENERGY ENERGYEnergy JUNE 2019 NERC RATES EKO DISCO BEST PERFORMING DISTRIBUTION FIRM By Shile GIWA The Nigerian Electricity Regulatory Commis- sion (NERC) has commended the management of Eko Electricity Distribution Company (EKEDC) for being the best distribution company in Nigeria. The NERC chairman, Prof. James Momoh, gave the commendation at the premier edition of EKEDC training for the newly employed 100 graduates. The newly employed graduates of the EKEDC participated in the session. He said the DisCo had performed credibly well in discharging its statutory obligations toward effective electricity distribution to customers within its area of operations. According to him, the company has attained 100 per cent-customers-complaint resolution.

He added that part of the NERC’s scorecard •Mr Ifeoluwa Oyedele indices used for the rating include Aggre- gate Technical, Commercial and Collection (ATC&C) loss reduction, revenue collection and metering. Others include are High Voltage fault clear- ance index, remittance to market operator •The NERC chairman, Prof. James Momoh and remittance to Nigerian Bulk Electricity Trading Company (NBET). he said. Momoh also assured the employees that the system would reward quality, dedication The NERC chairman tasked the newly He said the Meter Assess Provider (MAP) pro- and commitment of workers who are geared employed graduates to be more committed, gramme had come to stay because all DisCos toward effective service delivery. had signed an agreement with the meter dedicated and focused in the course of their providers within their operations to start the duties. “You are the growth that will control the economy; we want you to be free and relate rollout of metering. He said that achieving incremental, stable very well and avoid partaking in politics, and uninterrupted power supply in a safe Momoh, however, said that this would not gossip and disobedience,’’ he advised. be free to customers. “Meter distribution is and affordable manner is required of distri- going to be on monthly basis to customers bution companies. Also, the Managing Director of Eko DisCo, Mr Adeoye Fadeyibi, said the training as Discos are committed to MAP services Momoh said: “To achieve an optimal energy would bridge the gap for the company. providers. generation, transmission and distribution, Fadeyibi said he was also excited as a there is the need for capacity building to “MAP is not a problem; Nigerians will get me- Nigerian because the EKEDC was taking design, construct, build and test the new grid ters but they have to follow the procedure to the lead in the power sector by providing that is sustainable. get the meters. employment for some of the country’s teeming youths. “Cost reflective tariff will be effective when “There is the need for new curriculum for universities where every electrical engineer- there are no more losses in the system; when “We are here for an unprecedented ing students will be expected to take courses meters must have been installed and issues premier edition of EKEDC training pro- in economics, finance and vice versa; the of customers’ enumeration are put in place gramme where we have 100 individuals general course in apps design and commu- that will address most lingering issues in the who are graduating today. sector. nication, data analytics should be taught.” “Something that has not been done In his remarks, Mr Charles Momoh, the Chair- “Very soon, the price regime on cost before for as far back we know, in this man of EKEDC, advised the newly employed reflective tariff will be out which electricity particular distribution company, where graduates to take the job very serious and be customers will also partake in the discussion we carefully selected from almost 1,300 more focused in achieving their goals. to put the power sector in the right direction,” applicants. 17 ENERGY JUNE 2019 GAS FLARE COMMERCIALISATION: DPR BEGINS PRE-QUALIFICATION OF OVER 254 COYS By Meletus EZE •178 GAS FLARE POINTS IDENTIFIED he Department of Petroleum Re- sources (DPR) has commenced the the process. evaluation of Statement of Qualifi- “The provision of the law on paragraph 35b cation (SOQ) of over 254 companies of the first Schedule to the Petroleum Act whoT had showed interest in Nigerian Gas Flare stipulated that government has the right on Commercialisation Programme (NGFCP). the flared gas, so government has invoked The former Director of DPR, Mordecai Baba that right by means of deregulation of the Ladan, represented by Mr Olusanya Bajomo, flared gas(Prevention of Waste and Pollution) the Deputy Director, Gas Monitoring and Regulation of 2018, signed by Mr President Regulation, said at the opening ceremony of and Minister of State, Petroleum Resources, the pre-qualification exercise in Lagos that which came into effect July 2018 delineation of the two committees and its “By that regulation, government owns the composition including the Proposal Evalua- flared gas and the producer has not title to tion Committee (PEC), Independent Observer the flared gas, government can now allocate Group (IOG), representatives of the Nigerian it to competent companies that can take it to Extractive Industry Transparency Initiative market place, so, its government right. (NEITI), NNPC, DPR and Ministry of Petroleum Resources (MPR) were set up to evaluate those “However, the programme was to make the companies that had indicated interest to par- operators to be able to make this work, so ticipate in gas flare commercialization, which there are mechanisms in place to Incentiv- was instituted by the former Minister of State, ise operators’, well designed to protect the Petroleum Resources, Dr Ibe Kachikwu. operators, such that if the guarantee a certain volume to third party offtaker, they can even Bajomo said about 850 companies earlier get some fees in term of connection agree- showed interest when the advert was placed ment and be saved from penalty of flaring. but later dropped when a fee of 1,000 dollars (N360,000) was attached to the application Ogunsola said: “We are designing a programme that will intensify the scheme. First, form and other processing documentation to • Ahmad Shakur, Acting DPR Director know those who are serious. the regulation has increased the flared pay- through third party companies in order to ments, if you are producing 10,000 barrels of He said the DPR has currently identified about promote investment and get people who are oil and below you pay 2 dollars, that’s already 178 flare gas points across the oil producing qualified technically, have the capability and incentive to them to make it happen.” states, adding that this is part of President Mu- experience to work in Niger Delta to harness hammadu Buhari and former minister of State gas flare to market. In his remarks, the chairman of the evaluation committee, Mr Rabiu Sulaiman, Director, Gas, for Petroleum Resources agenda to achieve “So, we are currently doing preliminary eval- zero gas flare in Nigeria by 2020. Ministry of Petroleum Resources, commend- uation process that will see companies that ed DPR initiative of electronic evaluation He said: “Today, we are commencing the qualify to the next stage,” he said. initiative towards the high level of transparen- evaluation of statement of qualifications for the Corroborating Bajomo, Mr Olawole Ogunsola, cy that was exhibited in the process. Nigerian Gas Flare Commercialisation Pro- the Deputy Manager, Gas Production and gramme. Recall that advertisement was placed Sulaiman urged other committee members Monitoring Unit, said: “Federal Government to abide with the rules and regulation of the for interested parties who are willing to come to through the DPR and other stakeholders are take the flared gas on behalf of the government. exercise, adding that this is tinted towards interested in credible companies with techni- government’s aspiration in eradicating gas “We are going to open the documents to cal capacity and financial capability to be able flare in the country. ascertain those companies that have showed to take flare gas to market and that is why the interest and submitted their statement of net is wide at this time. “I implore everybody in this committee to qualification in response to the advert placed exhibit high level of seriousness and com- “There is no constraint to the number of firms mitment in the exercise. We are not here to in 2018. After the evaluation, the successful that should undertake the programme. But companies will move to the next stage. disqualify anybody but to evaluate those ultimately, you find out that as you go along, companies that merited the biding. “The Nigerian Gas Commercialisation Pro- some will drop by the side, it’s like a funnel, gramme, which is government’s flagship pro- it would go narrower until we get to the “This exercise will be rigorous but it’s going gramme that will create opportunity to take key companies that will be able to take the to pay off at the end because this will guaran- flared gas under the provision of Petroleum flared gas to market. So, government is not tee job creation as well as gainful engage- Act, also authorized gas commercialization constraining it so that will get the best out of ment in the oil producing states,” he said. 18 ENERGY ENERGYEnergy JUNE 2019 WHY WASN’T OANDO GIVEN A FAIR HEARING? By Abisola THOMPSON and follow due process. He reiterated that it was Does the SEC have the right to institute these in the spirit of transparency, cooperation and full penalties? According to the guidelines of the The long-awaited results from the forensic audit disclosure, they agreed to the forensic audit. SEC, Mary Uduk, as acting DG of the SEC was into Oando PLC, was finally released on Friday, Echoes of Oando’s sentiments are resounding meant to submit her findings to the Board of the May 31, 2019 on the website of the Securities SEC which has been non-existent since Mounir and Exchange Commission (SEC) indicating across the country with everyone wanting to know what exactly have the Oando man- Gwarzo was appointed DG of the SEC. This is not weighty infractions with attendant sanctions the norm and does not reflect corporate gover- leveled against the Company. agement team done to warrant such steep penalties’. Business personalities such as Atedo nance best practice. In the absence of a Board, a In a press statement issued on its website, Peterside, founder of Stanbic IBTC bank went so sign off from the Minister of Finance is required. Oando PLC responded to the SEC’s report far as to go on social media to publicly ask the Was this the case with the Oando Forensic Audit saying: “Oando is of the view that these alleged SEC why it would not share the findings of the Report? The consensus following the press infractions and penalties are unsubstantiated, forensic audit with Oando thus giving them an conference was that the publishing of the report ultra vires, invalid and calculated to prejudice opportunity to defend themselves. He went on whose cost would be borne by Oando without the business of the Company. The Company has further to challenge the SEC to share the forensic informing the principal, Oando, was contrary not been given the opportunity to see, review audit findings and Oando’s response with the to best practice. It further shows that these are and respond to the forensic audit report and general public so we can all judge for ourselves. not the actions of a regulator working in the so is unable to ascertain what findings (if any) best interests of the market specifically minority were made in relation to the alleged infractions According to a media source at the Oando press shareholders. These actions are damaging to and defend itself accordingly before the SEC. briefing, the forensic audit report was ready and the Nigerian capital market and will further The Company reserves its rights to take all legal submitted by Deloitte and Touche as far back as discourage foreign direct investment (FDI) into steps to protect its business and assets whilst December 2018. Why the SEC then decided to the country. sit on the report for six whole months without remaining committed to act in the best interests In terms of foreign direct investment (FDI), back of all its shareholders.” engaging Oando where necessary, remains a mystery. It also brings to mind the famous quote, in 2013 inflows totaled $5.6 billion, most of it in The severity of the penalties and the timing of power corrupts, but absolute power corrupts the telecom and energy sectors. In 2018, Nigeria’s the release has roused public curiosity as to the absolutely. Is this a case of abuse of power, or has FDI flattened to $2 billion. According to a recent motive and the basis for the penalties. According someone been put under duress to release the article by Forbes contributor, Kenneth Rapoza to the Chief Operating Officer, Oando Energy report without any regard for due process? What titled ‘Nigeria has become Africa’s money-losing Resource, Dr. Ainojie ‘Alex’ Irune, at a press con- are the details of the infractions as opposed to a machine’, if you want to lose money in one of ference in the Company’s head office, “We were summary and what are the associated penalties Africa’s biggest markets, put it in Nigeria. not given a chance to review and respond to for each infraction according to the SEC rule Despite sitting on nearly 40 billion barrels of the outcome of the report. You do not sentence book? proven oil reserves and $48 billion worth of in- a person to death without giving him or her vestment opportunities in the oil and gas sector, chance to defend him or herself. Drawing from a story by Proshare “Memo to the Market: The Oando Corporate Journey – At the Africa’s largest economy is mired in problems. In this instance we have been sentenced to Regulators Gate”, the publication said: “Regula- Kenneth said: “Its Nigeria’s abundant commodity death without knowing what our crime is or tory authorities in this age, as we have seen with resources that makes it so big. But its Nigeria’s being given a chance to defend ourselves. At the Debt Management Office (DMO) under Government that keeps it from getting bigger the barest minimum, best practice requires that Dr. Abraham Nwankwo and sustained under a and richer.” When stories of this nature run in the you give the person a chance of a fair hearing. new leadership understand that their ultimate international media we must sit up and take no- We have not been accorded this opportunity.” Dr. responsibility is to build businesses to be viable tice. In this instance we must look at the actions Irune explained that when the company made entities, stronger and not destroy value. Sanc- our regulators who are Government bodies take, the decision to drop its court case challenging tions arising from regulatory action therefore and ask ourselves are the legal, are they correct, the SECs decision to carry out a forensic audit it must be in accordance with extant rules and are they the actions of a progressive nation, do was assured that they could trust the system for regulations, severe relative to infractions, precise the perpetuate the negative picture that the an independent investigation that would be fair and satisfy the deterrence principle.” international media, business and investing community already have of our country? Looking at it practically, the SEC’s actions could be likened to a teacher who has informed a student that he has performed woefully in his exams and will be required to repeat without de- tailing the subjects, where errors were made and the associated grades to enable the student know what subject areas to improve on. The NSE owes it to the shareholders, the general public and to the world at large to do things the right way. The SEC owes it to the country to show that we are not regressing, that as a regulator they are fair, transparent and fully focused on protecting the Nigerian capital market. Speaking on the damage done to the brand since the inception of the investigation, the Chief Finance Officer, Oando PLC, Olufemi Adeyemo said: “The damage cannot be quan- tified. We require credit to run our business and this has come at an extra cost, one that we would ordinarily not have incurred. •Wale Tinubu 19 ENERGY JUNE 2019 AMIDST INITIAL HOPES, POWER SECTOR INTERVENTIONS FAIL TO SPIKE OPTIMISM Four years after Muhammadu Buhari took over as the nation’s President, and Babatunde Fashola as Minister in charge of Power as well as Works and Housing, many stakeholders rate the power sector’s performance below expectation. As Nigerians await a new cabinet, stakeholders in the sector demand urgent interventions to address the sector’s woes. Abisola THOMPSON writes.

he failure of the power sector to perform optimally despite previous privatisation exercise raised expectations from Nige- rians, who had hoped that with Buhari andT Fashola in power, the much needed reform to address inherent loopholes that existed under the previous administrations would be properly tackled. Four years after, stakeholders insisted that poor economic indexes in the country, characterised by growing poverty, unemployment, rising debt profile, growing generator economy, relocation of investors from the country as well as the harsh business environment were indications that power supply did not improve. territory split to ensure effective management, enmeshed in a blame game, which further saw the Buhari-led administration compounding the Former Chairman of the Nigerian Electricity stating that this would be a regulatory process situation. Regulation Commission (NERC), Dr. Sam Amadi, that is transparent and credible, and therefore who rated the current administration poor in would not be a political intervention. A former Director-General of the West African terms of promises in the power sector, said the “In the long term, consider unbundling distribu- Institute for Financial and Economic Manage- model for privatisation was unrealistic because it tion so that retail of electricity can be competi- ment (WAIFEM), and professor of Economics and hinged so much on the private sector, and didn’t tive. It is competition not privatisation that will Public Policy, University of Uyo, Akpan Ekpo, said think of a holistic government reform. lead to efficiency. Ultimately bring back state the power sector could increase GDP by almost one per cent if inherent challenges were ad- “Performance in the last four years has been very investment in electricity. It is a joke to believe that dressed, adding that the current administration underwhelming. The government did not lead with the present risks in the electricity market we only performed marginally in the sector. the sector away from the errors or underperfor- can expect private sector to grow the power sec- mance of the last administration,” Amadi said. tor significantly. No government should socialize He insisted that the new cabinet must fix the the investment risks and allow private sector sector, stressing that the country has all it takes to He added that the challenges in the sector management power facilities under special address the woes in the sector. included structural arrangement, market arrangement,” he said. operation, metering, weak infrastructure, market “No country develops with generators. Right governance, capacity input, leadership, finance, Indeed, the deteriorating situation in the Nigeria now, we are running a generator economy and stranded power, historical public sector ineffi- Electricity Supply Industry (NESI), became worse that cannot take us anywhere,” Ekpo said. ciency and gas related problem. that revenue collection was insufficient to pay power generation cost, leading to growing National President, Association of Public Policy Amadi noted that there was a need for the new industry losses at a rate of at least N474 billion Analysis, Princewill Okorie, equally insisted that cabinet to urgently address the sector’s chal- yearly. the sector does not deserve pass mark in the lenges by bringing back Presidential Taskforce power, especially with the poor treatment of on Power to keep traction on minor projects Recently, French Agency for Development (AFD), consumers and the lack of performance by to optimise supply, adding that this would be in Abuja, said nothing less than $10 billion is NERC. an inter-ministerial team that would ensure required in the next five years to offset invest- Calling for an urgent review and proscription consistent and high-level executive attention on ment shortfall in the 11 electricity distribution of NERC’s public affairs unit, Okorie said: “I find it the electricity crisis. companies (DisCos), stressing that the entire sector was at verge of collapse. difficult to really rate this government to have Amadi equally canvassed that DisCos’ perfor- done well in the power sector. This is because the mance should be benchmarked for six months, Instead of progress, most stakeholders noted regulators have been grossly inefficient. NERC and those who fail the trial should have their that the challenged power sector has been has been grossly inefficient and it is an abuse on 20 ENERGY ENERGYEnergy JUNE 2019 the anti-corruption policies of this government. Partner, Nextier Power, Emeka Okpukpara, had effective contract management, compliance said the distribution companies who were the to industry regulations and governance codes, “Consumers are suffering. The regulators that link to the consumers do not have adequate which is within the overall co-ordination of an issued licenses to DisCos cannot live up to asset to meter not only consumers, but also independent regulator – NERC. agreements. DisCos operated as if there are no transformers. regulators”. Executive Secretary of Association of Power “Due to aforementioned lack of assets, consum- Generation Companies (APGC), Dr. Joy Ogaji Pioneer Managing Director, Nigerian Bulk Elec- ers are billed arbitrarily under the context of had also noted that there was no significant tricity Trading (NBET) Plc, Rumundaka Wonodi, estimated billing, which has eventually eroded improvement under the current administra- insisted that the current administration was consumer confidence in the sector. With high in- tion, informing that GenCos were unable to compounding challenges in the sector, especial- cidences of energy theft coupled with consumer pay gas debt due to the liquidity challenge ly in the area of leadership, stressing that some apathy in electricity bill payment, the sector is in the sector. She added that the inability to power agencies were currently without boards, stuck with an eye-popping market shortfall of pay for contracted gas led to the immediate or have cloned their boards. nearly N2trillion ($5billion),” he noted. cutting off of gas supply to some power plants. “I think the leadership of the sector has not According to him, the sector currently lacks been consistent and steady, especially after the change of administration. The fact that most of the boards of the agencies like TCN, NBET, NIGERIA, OTHERS TO ACCOUNT were never constituted is not good enough, as government is not talking as one. We found out FOR 53% OF FOSSIL FUEL that different arms or agencies were not aligned By Meletus EZE ‘’As we move beyond 2030, 2040 and under the power sector recovery programme of 2050, the energy mix will continue to be igeria and other countries will ac- the government, therefore implementation has guided by availability, commercial con- count for 53 per cent of fossil fuel been elusive,” Wonodi said. sideration; which means, even for fossil in use by 2040, Seplat Petroleum fuel, countries will pay attention to cost Project Director, Taleveras Power Ltd, Belije Madu, Development Company Plc Chief because fossil fuel will have to compete listed the mistakes of the current administration NExecutive Officer, Mr Austin Avuru, has said. in the sector to include the lack of stipulated tariff the same way renewable will be able to reviews along with changing economic variables Fossil fuel, also known as hydrocarbon fuel compete,”Avuru said. is derived from oil and natural gas, is found based on the requirements of Multi-Year Tariff He explained that fossil fuel was always in Nigeria, Ghana, South Africa, Algeria, Order (MYTO), lack of improvement in power known to be a finite resource, which Britain, United States, Germany, Canada and sector efficiency as well as capacity charge on a means that the world, even over the last other countries of the world. volumetric basis, which is not working must be 100 years, knew that it will come to a revisited. He spoke at a session at a workshop hosted point where there will be a decline in the “Industry contracts are not enforced. There is by Petroleum Technology Association of Ni- supply of fossil fuel as energy source. gerian (PETAN) at the Offshore Technology visible lack of coordination and engagement “Those days in the 70s, there was a predic- Conference (OTC) in Houston Texas, United between sector players. Investment decisions tion by the International Energy Agency States. The workshop had “Global Energy are made without consultations with the boards (IEA) that between 2012 and 2015 we Transformation – The Effect and Future of of distribution companies (DisCos). Investment would get to peak oil. Peak oil means that the African Oil Industry and Economy” as processes are not well structured. There is need beyond that point, we will begin to see a theme. for strong cross-cutting corporate governance decline in the world production. Thanks across sector and consistent cross-sectoral com- ‘’Even up to 2040, fossil fuel will account for to technology. That date has been shifted munications across the value chain. 53 per cent of the world energy demand. forward. Peak oil will come. We have only “Nigeria’s electricity supply industry is experi- So, what we are seeing today is a gradual shifted it forward because of technology. decline in the total contribution of fossil encing policy incoherence and gaps. Several ‘’Today technology has enabled us to get fuel to the energy mix over time. It is not an organisations are currently making policies for crude oil and natural gas out of shale. overnight elimination of fossil fuel,” he said. NESI, without any over-arching policy harmoni- Those of us who are geologists have sation, thus resulting in policy bottlenecks. Rural Avuru noted that the global trend in energy always known that, there was crude oil in Electrification Agency (REA) is making policies supply would seem to suggest alarming. shale, but shale didn’t have the permea- on off-grid electricity supply for underserved “The impression is generally given that the bility to release it. What technology has areas. Transmission Company of Nigeria (TCN) world is fighting a spirited battle to make done through cracking is to induce that is making policies on levels of electricity supply sure that fossil fuel becomes irrelevant; and permeability to release the crude oil and (TCN Expansion Plan). Eligible Customer policy in that context, for countries like Nigeria natural gas from shale. Thanks to tech- has been declared, but not been implemented,” that are endowed with fossil fuel, some nology because we have seen additional Madu added. people seem to be saying Nigeria is going sources of crude oil and natural gas that While distribution companies were mandated to to wake up one day and find out there is no moved backwards the date for peak oil. use for its crude oil and natural gas. meter consumers, industry regulator, the NERC, ‘’So, what we are seeing today is a very reported poor performance by the DisCos. “This impression also suggests that Nigeria sensible scientific move by the world In fact, a new programme called Meter Asset will become a worthless country because and by the advanced technologies of the Provider (MAP), which was set up to fast-track its fossil fuel endowment will become com- world to start developing that alternative bridging of the gap has not achieved desired pletely useless to the world. to fossil fuel because the day will come objectives. when there will be no fossil fuel,” he said. 21 ENERGY JUNE 2019 By Shile GIWA PEC and its partners will take the current “economic bearishness” into account when they meet in OPEC SEEKS coming weeks, and are committed Oto keeping oil markets balanced this year and beyond, its Secretary-General, Mohammad Barkindo has said. TO BALANCE The organization will be “unyielding” in its efforts to reduce oil inventories back to normal levels and revive investment in the industry, taking an approach that is “agile” and “flexible,” Barkindo said in remarks delivered MARKET AS via video link at a conference hosted by RBC Capital Markets in New York. “There has also been a significant change in market sentiment, in both equity and UNCERTAINTY financial markets” that has worsened many institutions’ outlook for oil demand growth, Barkindo said. “This will all play into our calculations in the upcoming ministerial meetings.” LINGERS Meanwhile, Russia’s Energy Minister, Alex- ander Novak, was quoted to have said the yet to decide when it will meet to address the G20 meeting in Japan on June 28-29, country is not ready to commit to further the supply accord. OPEC originally scheduled “to further calibrate our positions”. Despite production cuts under an OPEC/non-OPEC its regular semi-annual meeting for June Russia’s wavering on its cuts, both sides said supply accord, with the oil market facing 25 in Vienna, with non-OPEC partners to they remain committed to continuing coop- many uncertainties in the months ahead. join the talks the following day. But Russia eration on managing the oil market. OPEC “A lot depends on the market situation in the has pushed for the dates to be changed to has for more than a year been developing a second half [such as] sanctions [and] trade July 3-4, with Algeria, Iran and Kazakhstan charter to formalize its partnership with its 10 disputes, so today we are discussing it,” he opposed. non-OPEC allies, whch officials say they hope to signat the next meeting. said at a press briefing in Moscow, where Falih said he may meet Novak again at he was meeting Saudi counterpart Khalid al-Falih at a Saudi-Russian economic summit. “We think we need to continue to monitor the situation and see what happens in June ELIMINATE FUEL SUBSIDY, OTHERS TO ACHIEVE so we can take a balanced decision in July.” US sanctions on Iran and Venezuela are DOUBLE-DIGIT GROWTH — EX-AMCON CEO likely to tighten the market, many analysts By Aliyu DANLADI subsidy will also attract significant investments to the power sector and unlock other forecast, while US-China trade tensions could r Mustafa Chike-Obi, the opportunities. dampen global oil demand. Executive Vice-Chairman, Alpha OPEC and 10 non-OPEC partners, led by Rus- African Advisory, has advised Chike-Obie said: “The most challenge to sia, agreed in December to cut a combined the Federal Government to our economy is the three subsidies that is Mremove subsidies on fuel, foreign exchange added up to our total revenue.” 1.2 million b/d in the first half of 2019. Falih has urged the coalition to extend the cuts, and electricity for the nation’s economy to achieve double -digit growth. On fuel subsidy, he said: “The nation’s econ- saying global inventories were still too high. omy is losing about N1.2 trillion per year. Almost every member of the 24-country Chike-Obi gave the advice at a bi-monthly There is hidden figure in that fuel subsidy coalition is on board with a rollover of the forum organised by the Finance Corre- they do not allow you to see. They allow agreement, except for Russia, which has spondents Association of Nigeria (FICAN) them to buy foreign exchange at N325/ been vacillating over how much production in Lagos with the theme, “Reposition the dollar. Nigerian Economy for Sustainable Growth.” it was willing to cut, Falih said in an interview “Who gets the fuel subsidy? The rich people with Tass news agency.“All the big producers He said the various forms of subsidies were with six cars are those benefiting from fuel in OPEC, as well as many non-OPEC countries hindering other sectors that needed urgent subsidy. The average rich person in Ikoyi is like Oman, Kazakhstan, Azerbaijan have also attention. getting approximately 100 times a year fuel supported the extension,” Falih said. subsidy than person in Shomolu in Lagos. Chike-Obi, a former Chief Executive Officer “The remaining country to jump on board of the Asset Management Corporation of “Everybody deserves to have electricity but now is Russia. I will wait for the Russian Nigeria (AMCON), said that rich Nigerians you charge electricity based on those who dynamics to work themselves out. There is a were benefiting more from fuel subsidy, need it the most at the market price. Most debate obviously within the country about therefore, calling for its removal. people than use generator pay N160/Kwh the exact volume that Russia should be pro- and pays comfortably. ducing in the second half. ”The coalition has According to him, removing electricity 22 ENERGY ENERGYEnergy JUNE 2019 WHY PIPELINE VANDALISM, CRUDE THEFT EXIST IN NIGER DELTA

By Abisola THOMPSON seled that Nigeria should enforce the partners and as such must do everything much-needed discipline in the oil and gas possible to ensure that the relationship he decision by the Federal Govern- sector, which according to him is currently is mutually as beneficial as possible. The ment to delay the implementation marred with violence and corruption. change of outlook will invariably impact of the community engagement the attitude of members of oil-producing standards in Niger-Delta may have He stressed the need for Federal Gov- states towards companies,” he said. resultedT in the spate of unwholesome ernment to review the comprehensive activities in the region, an energy expert, standards and principles of community “Following the establishment of clear Meka Olowola, has said. engagement put forward by sustainability communication lines between all stake- inclined stakeholders in the sector, led holders, oil companies must proceed to He said the activities include pipeline by the Ministry of Petroleum Resources, launch sustainable and far-reaching CSR vandalism, crude oil theft and other Facility for Oil Sector Transparency and activities. The practice of CSR transcends untoward practices in the region, adding Reform (FOSTER II) in Nigeria, CSR-in- charitable donations and companies that the development has slowed down Action. He said standards are products need to obtain a full understanding of oil production in Nigeria. of painstaking research and will help in this fact which will change the conduct of He said the inability of the government laying solid structures to tackle communi- firms across the nation. The Community to review its strategy and approach to ty conflicts and reduce oil theft as well as Engagement Standards codifies the best conflict resolution in the region, is having illegal bunkering. approach to optimising the gains of the oil negatives consequence on the country’s & gas sector,’’ he added. Olowola said the challenges facing both oil earnings. oil companies and communities in the Olowola decried the unending cases of A Community Engagement Standards Niger Delta region can be prevailed over pipeline vandalism in the region, stating is a widely researched framework for with proper stakeholder engagement that it is inimical to all stakeholders as the consciously and equitably engaging host and communication. He stressed that culprits create lasting damages to their en- communities in the Niger- Delta. the need for oil companies to engage in vironment and put their lives at risk, while multilayered dialogue with host com- the oil-dependent economy of the nation Speaking on strategies to reducing munities and the government cannot be suffers huge losses. vandalism and theft in the sector, Olowola overestimated, saying the Community said the implementation of the engage- He maintained that the government must Engagement Standards gives insights as ment standards is inevitable, if the country earnestly devise strategies to halt the to how this can be achieved using real-life must put an end to such activities. practice before it snowballs into greater scenarios. national issue. Olowola enjoined the oil He identified commitment to acceptable “The rising tension between oil compa- companies to hearken to the demands engagement standards across the value nies in the upstream sector and their host of members of their host communities, chain as a panacea to incessant conflicts communities call for a multi-stakeholder saying he is aware of how difficult it could in communities that play host to oil and engagement approach. Companies need be, given that individuals have diverse gas exploration companies and coun- to see their host communities as business interests. 23 ENERGY JUNE 2019

By Shile GIWA bout six month into the 2020 target WHY NIGERIA WILL MISS set by the Federal Government to boost power transmission wheeling 10,000MW TRANSMISSION capacity to 10,000 megawatts (Mw), Astakeholders in the nation’s electricity sector CAPACITY BY 2020 yesterday insisted the plan is only a mirage. The plan, which is part of a Transmission Master Plan, designed by the Transmission Company of Nigeria (TCN), had highlighted steps to add 10,000MW electricity wheeling capacity by 2020. The Master Plan, expected to gulp N805.7 billion ($2.238billion) equally targets a wheeling capacity of 15,000Mw by 2025, with finance options from about eight foreign banks as well as donations from the World Bank. While the Managing Director of the TCN, Us- man Gur Mohammed, had repeatedly said the plans were feasible, experts including Partner, Nextier Power, Emeka Okpukpara; former Chairman of the Nigerian Electricity Regulation Commission (NERC), Dr. Sam Amadi, as well Okpukpara noted that Nigeria has not done Part of the TCN’s master plan included the as Executive Secretary, Association of Power anything differently to achieve a 10,000Mw in Transmission Rehabilitation and Expansion Plan Generation Companies, Dr Joy Ogaji, said the the next six months, stressing that the money (TREP), being implemented through the Ni- plan is impossible. required to fund the capacity could equally geria Electricity and Gas Improvement Project remain a challenge. (NEGIP), a facility from the World Bank. TCN said it has about 8,100Mw transmission capacity, but in the real sense, only an average According to him, the transmission network in He said there was need for priority projects, 4,000Mw is available to power. Indeed, most the country is outdated, thereby a wide range adding that the transmission sector has a rea- stakeholders believe the target was fabricated of assets are scattered across the country, which sonable level of investment inflow, which can for political propaganda as power supply in require urgent repair. only yield desired results if prioritised. Nigeria has remained epileptic. Amadi said prevailing situation in the transmis- ROADSIDE GAS SELLERS UNAWARE OF GOVT’S sion sub-sector indicates that the plan could be PLANNED CLAMPDOWN - SURVEY difficult to achieve, saying: “There is no basis to expect such miracle in six months. With the ca- By Aliyu DANLADI to the right procedures especially roadside or illegal gas sellers. pacity in execution that we have seen so far, the ome roadside sellers of Liquefied Pe- sector cannot operate at that level of efficiency.” troleum Gas (LPG) popularly known as She said that after awareness, the Department Although the transmission sector receives cooking gas in Abuja, have said they of Petroleum Resources (DPR) would com- investment shares when compared with the were unaware of the government mence clamping down on illegal or road side Splanned clamp down on their business. sellers. rest of the value chain, especially distribution, Amadi insisted that the transmission segment A visit to some of the outskirts of the territory “Actually, enforcement will start next week, is the main bottleneck of Nigeria’s electricity showed that most sellers were yet to be we will start notifying people from today (May supply chain. informed of what government had planned 24); there will be jingles in the media, so that He said: “We generally believe that transmis- to ensure penetration of LPG in the country. people will understand what we are talking sion is the main bottleneck; if power is not about,” she said. evacuated then the DisCos can’t supply and Some of the areas visited were Gwarinpa Es- when there is transmission failure everything tate, Dutse Alhaji, Dawaki, Kubwa and Ushafa But Mr Emmanuel Samuel who sells Gas in is affected. So we need to expand to enhance in the FCT. Ushafa said that he had not heard the jingles on TV or radio. I listen to radio always, I have the capacity and reliable grid. But it is coun- The federal government had on May 24 said not heard any jingle on this issue you are terintuitive in a sense, because if DisCos are it would inject 600,000 gas cylinders as part telling me now. inefficient, then they will hobble the reliability of effort to ensure LPG penetration in the of transmission. country. “In fact, this is the first time I am hearing it. May Grid failure on the Discos’ side also affects trans- be, if I understand what government is doing, I Ms Brenda Ataga, the special Adviser to the mission capabilities. So failure in the industry will comply, nobody has come to sensitise me,” former Minister of State for petroleum re- is self-reinforcing. We need quality spending he said. sources, Dr Ibe Kachikwu, on Gas, said the cyl- on all sides of the value chain, but since DisCos and Gencos are privately owned, government inders would be distributed to all recognised Another seller, at Dutse Alhaji zone1, said “I shouldn’t be spending on them but rather micro distribution centres in the country. heard in the news that government wants to buy gas cylinder for Nigerians. This is a good enhance financial sector willingness to invest She said that government would commence idea but, I don’t know how they will retrieve in them.” awareness campaign to help sensitise people the various cylinders in many homes. 24 ENERGY ENERGYEnergy JUNE 2019 NNPC ASSURES TRANSPARENT SELECTION OF OFF-TAKERS FOR SALES OF NATURAL GAS By Meletus EZE he Nigerian National Petroleum Cor- poration (NNPC) has said the selection Tprocess for off-takers for the sales and purchase of natural gas liquid resources will be transparent. The Group Managing Director, Dr Maikanti Baru, gave the assurance at the 2019 Natural Gas Liquids Bid opening in Abuja. “As a corporation, our current pursuit is to continuously make grow our domestic gas supply and utilisation, while maximising value from our unutilised knock off condensate and natural gas liquid resources. “Our strategic focus in the coming months is to expand domestic Liquefied Natural Gas (LPG) supply from our established local sources while also encouraging investments in storage, marketing and distribution infrastructure. “Through a transparent competitive bidding and evaluation process, we intend to enlist companies with proven investments in Gas utilisation, storage, distribution and market- He said that the objective of the 2019 tender and Nigerian Content Acts. ing infrastructure,” he said. was to engage reputable qualified companies as off-taker natural gas Liquids He said the domestic supply of Lique- Represented by Saidu Mohammed, Chief for domestic violence and international fied Petroleum Gas (LPG), also known Operating Officer, Gas and Power, Baru market. as cooking gas, would exceed demand said the occasion marked the beginning of in the country and blamed the current another landmark event in the bid to maxi- He said it would also ensure selection of low consumption in Nigeria on lack of mise value of the nation’s natural gas liquid off-takers that aligned with tested trans- penetration of the commodity across the resources for the benefit of Nigerians. parent and accountable procedures in length and breadth of the country. compliance with the Public procurement OIL WELL FIRE: 21 ONDO COMMUNITIES DEMAND $2.5BN COMPENSATION FROM CHEVRON By Abisola THOMPSON the affected 21 communities within the eight without delay. kilometres radius (due to low and high tide) to wenty-one communities affected by the Akinruntan said that medical examination the tune and not less than 2.5 billion dollars. Ojumole Oil Well fire incident in Ilaje Local should be carried out on the people exposed TGovernment area of Ondo State, have He said Chevron management should also to the fire within the eight kilometres radius, demanded for 2.5 billion dollars as compensa- inform leadership of the affected communities while those with signs and symptoms should tion from the Chevron Nigeria Limited. on the method it had put in place to quench be treated immediately. the raging fire. Dr Akin Akinruntan, made the demand on The communities’ spokesperson urged behalf of the affected communities at a public According to him, this is to avoid the use of Chevron to disclose the barrel of crude oil it hearing of major stakeholders conducted by dangerous chemicals which will further put the produced per day from the Ojumole Oil Well. the State House of Assembly in Akure. lives of people in the community to jeopardy He also advised the Ondo State Government and this should be done immediately. The fire broke out in the Oil Well on April 18 and to come to the aid of people by critically was still raging up till this moment. Akinruntan He told the oil company that the affected studying the amnesty international reports of said Chevron should pay the compensation to environment should be cleaned up and cooled June 2009. 25 ENERGY JUNE 2019 WE’RE INSPIRED BY DPR’S REGULATORY ACTIVITIES IN OIL, GAS SECTOR –UGANDA barrels from contingent resources, which are Uganda’s Albertine Graben for further explora- By Abisola THOMPSON qualities of oil and gas estimated to be poten- tion which, she noted, was expected to increase fficials of the Petroleum Authority of tially recoverable but currently not considered the current oil stack of the country. Uganda has commended the man- to be commercially recoverable due to one or Namubiru said that two oil licenses had be agement of Department of Petroleum more contingencies,” she said. O awarded to a Nigerian company, Oranto Energy Resources (DPR)’s professional conducts in The PAU manager said Uganda was going into and Australia company called Armor Energy. carryout its regulatory activities in the oil and development stage of production, saying that gas industry. She said that through an investment of about about 20 billion dollars investment had been in 3.5 billion dollars, the company was able retain Manager, National Content, Petroleum Author- the oil and gas to help in the construction and about 900 million dollars in-country which ity of Uganda (PAU), Mrs Betty Namubiru, gave development of the upstream and midstream represent about 28 per cent. “We maintained the commendation during their official visit to projects. significant percentage of the money is retained the Department in Lagos. “The outlays for this year is part of the close to in the country towards nationalisation. Namubiru said the essence of the visit was to 20 billion dollars that the government expects In his remarks, Mr Mordecai Ladan, the former learn from DPR’s operational activities in the oil over the next three years as joint venture oil Director of DPR, said there was need for more and gas sector and imbibe some the working company partner to step up activities to com- collaboration between Nigeria and Uganda models adopted by the agency. mercialised Uganda’s petroleum resources. in the oil and gas development, partnering She said the PAU officials were on a fact-finding “Uganda expects to reach fully-fledged oil together to “Power Africa” from abundant oil mission on how best Uganda’s national petro- production in the next five years following and gas resource. leum could be optimised for the benefit of its impressive oil exploration result in the Lake Ladan, represented by Mr Ahmad Shakur, Dep- incoming investment to Uganda as a result of Albelt Valley. uty Director, Corporate Services, said Uganda construction of the oil facilities and develop- “Oil output is then expected to keep rising and could leverage on Nigeria’s experiences for ment of the crude oil production. reach full-scale in the next five years. By that capacity building and knowledge development “We are truly inspired with the professional en- time, Uganda expects to produce between in key aspects of the oil and gas industry. gagement of the agency in the Nigerian oil and 40,000 and 60,000 barrels of oil per day,’’ He said that technology transfer in key area gas industry. We are here to learn from Nigeria Namubiru said. across the oil and gas value chain was import- on how it has been able to benefit from the oil She said the country was also targeting to ant, while investment opportunity across the and gas sector. invest in Greenfield refinery of 60,000 barrel value chain was also key. “We are at the moment; Uganda oil reserves per day production, adding that Uganda is also Ladan said Nigeria’s abundant hydrocarbon estimates remain six billion barrel and the esti- working towards construction of the crude and human resources placed it at an advantage mates of one billion barrels is the recoverable export pipeline of about 45 kilometers. position in Africa to put its experience to bear in volumes at the `current condition’. Namubiru said that Uganda had unveiled five oil and gas. “These reserves can be increased to 1.4 billion oil blocks available for licensing bid round in He, however, hailed the initiative of PAU in undertaking a learning mission to Nigeria and pleged necessary regulatory support, adding that Nigeria was working through its challenges to transform the industry and economy and maintain its position as the giant of Africa. He said that Nigeria is working towards increasing its oil reserves to 40 billion barrels from its current 37 billion barrel, while targeting 2.8 billion barrel per day production capacity. “Our vision is to ensure the sustainable development of Nigeria’s oil and gas resources across the value chain for our stakeholders through effective regulation, while entrenching world class professionalism, accountability, and transparency. “Government is also working hard to eliminate gas flaring in the country as it’s gradually reducing. Close to 80 per cent of gas utilisation •Officials of National Content, Petroleum Authority of Uganda (PAU) during a is domestic for power which we intend to courtesy visit to the Department of Petroleum Resources (DPR) in Lagos. increase,” he said. 26 ENERGY

JUNE 2019

month-on-month basis, the headline index increased by 1.11per cent in May HOW RISE IN INFLATION 2019, this is a 0.17 per cent higher than the 0.94 per cent rate recorded in April MAY AFFECT NIGERIANS 2019. “The percentage change in the av- The Central Bank of Nigeria (CBN), the apex regulatory body of banks, erage composite CPI for the twelve recently expressed fears that inflation rate may rise marginally into the months period ending May 2019, over second quarter of 2019, fueling fears in some quarters that the economy the average of the CPI for the previ- may take the hit. Olamilekan FAWAS in this report examines the issues. ous twelve months period was 11.30 percent, 0.01percent points from 11.31 percent recorded in April 2019,” the he current upward movement of Statistics (NBS) recently said the na- report added. inflation rate may pose great tion’s inflation rate increased to 11.40 uncertainty for the Nigerian per cent in May from 11.37 per cent The urban inflation rate increased by market and affect the country’s recorded in April. 11.76 per cent (year-on-year) in May exchangeT rate but the Central Bank of 2019 from 11.7 per cent recorded in The NBS, in its “Consumer Price Index Nigeria (CBN), had vowed to continue April 2019, while the rural inflation (CPI) and Inflation Report” for May to tight economic policies due to the rate increased by 11.07 per cent in May 2019, said the figure was 0.03 per cent country’s inflation outlook. 2019 from 11.08 per cent in April 2019. higher than the rate recorded in April The country’s inflation may rise to 12 2019. On a month-on-month basis, the ur- per cent this year before moderating, ban index rose by 1.15 per cent in May According to the bureau, increases according to the CBN Governor, Mr 2019, up by 0.15 points from one per were recorded in all consumption Godwin Emefiele. The National Bureau cent recorded in April 2019, while the that yielded the headline index. “On 27 FINANCE JUNE 2019 rural index also rose by 1.07 per cent consumption—operating under the This rise in the food index was in May 2019, up by 0.17 from the rate caused by increases in prices of larger, overarching assumption that recorded in April 2019. meat, oils and fats, bread and higher levels of spending are crucial cereals, potatoes, yam and other for economic growth. The report said food index rose by tubers, fish, milk, cheese and 13.79 percent in May 2019 compared egg, and vegetables However, economic analysts believe to 13.7 percent in April 2019. the rise in inflation whether marginal or substantial has adverse implication “This rise in the food index was caused for the economy in terms of value of by increases in prices of meat, oils and money. fats, bread and cereals, potatoes, yam and other tubers, fish, milk, cheese and Inflation arises when prices rise for egg, and vegetables,” it added. energy, food, commodities, and other goods and services, the entire econo- In terms of state inflation profile, the my is affected. report said price increases were high- output stabilization,” he assured. est in Kebbi (15.76 per cent), Bauchi Rising prices, known as inflation, (14.97 per cent) and Kaduna (13.74 pe What rising inflation means impact the cost of living, the cost of cent), while Abia (9.91 per cent), Cross According to Investopedia, “Inflation doing business, borrowing money, River (9.68 per cent) and Kwara (8.45 is a quantitative measure of the rate mortgages, corporate and government percent) recorded the slowest rise in at which the average price level of a bond yields, and every other facet of headline year-on-year inflation. basket of selected goods and services the economy. When inflation is too in an economy increases over a period high of course, it is not good for the The monthly inflation rates released economy or individuals. by the Nigerian Bureau of Statistics of time. It is often expressed as a per- measures the percentage at which the centage. Inflation indicates a decrease Inflation will always reduce the value prices of products rise or fall. When in the purchasing power of a nation’s of money, unless interest rates are the data shows a reduction, therefore, currency.” higher than inflation. And the higher it means there was an increase in the Many economists, businessmen, and inflation gets, the less chance there is price of that product but at a reduced politicians maintain that moderate that savers will see any real return on percentage. If there is a reduction in inflation levels are needed to drive their money. price, it means there was deflation. The current upward movement may ” pose great uncertainty for the Nige- rian market and affect the country’s exchange rate. The CBN had vowed to continue to tight economic policies due to the country’s inflation outlook. Commenting on the post-election outlook, Emefiele said the country’s inflation may rise to 12 percent this year before moderating. According to him, despite this gloomy picture, the short- term outlook of the Nigerian economy remains good. “We expect that monetary policy stance will remain judicious, research-driven, adequate and supportive of the real economy subject to underlying fundamentals. The current tight stance is expected to continue in the near-term, especially in view of rising inflation expectations and exchange market pressures. “Though we will act to appropriately adjust the policy rate in line with un- folding conditions and outlooks, CBN will continue to ensure that the policy interest rate is delicately set to balance the objectives of price stability with •Emefiele 28 FINANCE FINANCE JUNE 2019 Fears of rising inflation if power is put in place and it gets However, in the view of Mr Adewunmi stable that would really help the local Adewale, an accountant with the Asso- producers very well. If there is good CBN RISING ciation of Bureaux De Change Opera- power supply, definitely most local tors of Nigeria, the fears over-spike in producers would not depend on AGAINST inflation rate may not be unfounded. powering their plants with generators What needs to be done, Adewale and expending much money on over- heads and all other production cost. THE TIDE TO stressed, was for the government to be proactive rather than resign itself So, we can start from power. Let that to fate. be done. Let the government also fix STABILIZE our roads so that produce or products He said the issue on spike on rates was can be conveyed seamlessly from one all based on projections the organ of location to the other. Things being ECONOMY By Abisola THOMPSON government is looking at. produced in the north should be able s many of us already know, balanc- Adewale noted that every indices of to get to the south without much hassle and vice versa.” ing the objectives of price stability government in a way come in form of with output stabilisation, especially projections, adding that whatever pro- Like Adewale, Chinedu Bosah, a public in the face of external headwinds, jections the government was looking affairs commentator said, “if there is Aremains a challenge to monetary policy and at to be able to inform. no use of FX for importation of things central banks, particularly in emerging and developing economies. “Every government wants a situation like took pick and juices, among whereby the financial system needs to others, our FX rate can be more stable Since the global financial crisis, many central be a stable system and every reason- and ultimately our currency. banks have begun to promote structural able government and every economy And the spike being envisaged may transformation and economic growth, beyond the singular mandate of price stability. would want a situation whereby the not really happen at the end of the foreign exchange rate would be as sta- day provided there is sustainability Consequently, policy toolkits now contain ble as you can find such that investors in the level of local production and instruments that are aimed at developing the can predict the foreign exchange (FX) local content development. And with financial sector, engendering wider financial rates. that we will all be happy for it and inclusion, and aligning financial policies with sustainable development and growth. “We don’t pray for any spike that even the investors would be happy to would further inflate the rate more say our rate is stable, let us come and As some of you may know, the global finan- than we have in the current situation. invest. Any reasonable investor wants cial crisis of 2008 – 2009, which was trigged by the housing price bubble in the United So, we don’t pray for such. Because to see a business environment that is stable including stability in rates, sta- States, created considerable uncertainty in when there is a stable FX rate, every the global financial market and uncovered other aspects of the economy would bility in policies, and even the polity itself.” the weakness of many economies. It also be able to thrive very well. exposed the inadequacies of conventional “You must realise that our economy CBN’s interventions monetary policies in tackling the challenges that came as a result of the crisis. As a result, is one that revolves round FX by the Perhaps in its quest to rein in the ad- the United States and several countries with- nature of the activities we operate, verse effects of rise in inflation figures, in the Euro Area fell into a recession between and we should be able to and that’s the CBN decided to cut its benchmark 2008 and 2009. the more reason why we must work interest rate by 50 basis points to 13.5 Before the onset of that crisis, policymaking towards the goal of this current per cent on March 26th 2019, mainly administration, which is saying let’s at central banks had been dominated by to stimulate the economy. neo-liberal and orthodox doctrines, as pro- grow what we eat and let’s eat what moted by key Bretton Woods Institutions like we grow. The move surprised markets who had expected the rate to remain steady the International Monetary Fund (IMF). These “So, if there is a shift of focus from at 14 per cent and marks the first rate tenets emphasised price stability as the sole and exclusive mandate of central banks. importation, the FX rate would be cut since November 2015. Six out of stable. If we produce what we eat, in the eleven members of the monetary However, lessons learnt from recent crises terms of local content development policy committee voted to reduce the in addition to the global financial crisis, have and we are not dependent on im- current monetary stance. raised doubts on the validity of this position. portation as well as other some basic What became obvious, following the GFS things,” he added. In February 2019, the annual infla- crisis, is that conventional monetary policy tion edged down to 11.3 per cent tools were not sufficient in dealing with the Quick wins from 11.4 per cent in January, but complexities resulting from the Crisis; such as debt overhang and stagnating economic What the government can do as a still above the Bank’s target of 6-9 growth. matter of urgency, Adewale stressed, per cent. Policymakers added that “is to drive the process of getting our the economy is projected to grow As a result, Central Banks in the US and in the infrastructure working. For instance, between 2.7 per cent and 3 per cent Euro Area had to utilize unconventional tools in 2019. in their efforts to achieve their macroeco- 2919 FINANCE JUNE 2019 nomic goals of output growth and price stability. The use of unconventional tools such as quantitative easing and forward guidance, led to a growth recovery in the US, as well as a reduction in the unemployment rate. On the reverse side and not withstanding its achievements, it is conceivable that unconventional policies could heighten tradeoffs such as its resulting effect on the balance sheets of Central Banks. In this discussion, I will highlight the CBN experience with unconventional monetary policies tools in light of the extraordinary challenges the Nigerian Economy faced as a result of drop in commodity prices between 2014 and 2016. I will also discuss some of the key challenges confronting the Bank in the formulation and along critical trading routes in the world: This With the drop in FX inflows, the exchange implementation of unconventional mon- began around March 2014 with the United rate at the parallel market rose from about etary policy tools –including the reaction States’-led sanctions on Russia for its role in N200/US$ in August 2015 to N525/US$ in of key Bretton Woods institutions to our precipitating the conflict in Ukraine. Other February 2017. Inflation also rose from 9.6 approach. areas include Britain’s desire to pull out from percent in January 2016 to over 18.7 percent the European Union, and rising trade ten- in January 2017. CBN’s policy remit sions between the United States and China, Our external reserves fell from about Though the 2007 CBN Act specifies price with its attendant implications on global trade and capital flows; US$31billion in April 2015 to US$23billion in stability as the overriding mandate of the October 2016, and activities in the industrial Bank, permit me to highlight here, that the ii. Softening crude oil prices: The significant sector witnessed a lull as manufacturers operationalisation of this mandate is some- drop in the price of Bonny light, Nigeria’s struggled to get access to key inputs needed what tricky. What exactly does price stability crude, from US$115 per barrel in June in the production process. denote? Paul Volcker and Alan Greenspan, 2014 to US$31 per barrel by January 2016 former Governors of the US Fed, have de- exposed the structural vulnerabilities of an Other vulnerabilities include slowdown in fined it as what obtains when “the public no oil dependent economies like ours; and government spending (following the fall longer takes account of actual or prospective in government revenue), build-up in the inflation in its decision-making”. iii. Normalisation of monetary policy by the demand for foreign exchange, and high US Fed: In October 2014, the US Federal exposure of the banking sector to the oil and For the CBN, it is achieved when inflation Reserve commenced the tapering of its gas sector. lies within the tolerance band of 6–9 per quantitative easing programme towards a cent. Within this band, we believe that the more conventional monetary tightening Driven largely by the downside effects of evolution of relative prices is able to optimize cycle. This decision led to acute capital flow these shocks, real GDP growth plunged the micro objectives of firms and households reversals especially from emerging markets sharply from 6.2 per cent in 2014 to a 1.6 per while maximising total utilitarian welfare of and heightened financial fragilities in these cent contraction in 2016. Nigeria effectively the economy. countries. slipped into a technical recession in the second quarter of 2016 and maintained For an economy like ours, which is yet to Effects on the domestic economy negative growths in ensuing quarters of that attain its full potential, utilitarian welfare year. Disaggregation of the 2016 outcomes maximisation requires a functional consider- Unarguably, the most important of these showed the worst contraction of 2.4 per ation for real growth. Thus, growth objectives factors to impact the Nigerian economy was cent in quarter three and a turning point cannot be overlooked. The CBN Act 2007, the plunge in crude oil price. Nigeria’s over- thereafter. in recognising this, provided the Bank with dependence on crude oil for over 60 percent the legal backing to undertake develop- of fiscal revenue and over 90 per cent of FX Addressing the recession: The monetary mental functions that are consistent with inflows, meant that shocks in the oil market and fiscal policy mix price stability. This has enabled the Bank to were transmitted entirely to the economy via the FX markets as manufacturers and traders In a bid to contain rising inflation and to simultaneously promote the development of cushion the impact of the drop in FX supply financial markets and stimulate the growth who required FX for input purchases were faced with dwindling supplies. on the Nigerian economy, the monetary and of the real sector. fiscal authorities took extraordinary mea- Recent experience of the CBN Average monthly inflows of FX into the CBN sures to tackle these extraordinary challeng- fell from over US$3.4bn in June 2014 to a low es. Some of the measures we took, a number The CBN’s experience with heterodox poli- of US$1.4bn in September 2016. The decline of which are indeed unconventional, include; cies expanded during the recent economic in FX earnings was further complicated by crisis that begun in 2014 due to a number of the foreign capital flow reversals due to rising • Monetary Policy: Over the intervening global shocks, three of which were simulta- yields in the USA. The impact of these on our period, the CBN embarked on a cycle of neous and significant in shaping the trajecto- economy was evident in the rising pressure tightening which culminated in a July 2016 ry of the Nigerian economy, namely: on the naira-dollar exchange rate. hike in the Monetary Policy Rate from 12 percent to 14 per cent. This decision was i. Widespread and rising geopolitical tensions 30 FINANCE FINANCE JUNE 2019 expected to rein in expected inflationary attempt at using unconventional tools to pressures that may result from exchange rate mitigate the effects of a slowdown in growth, pass-through to domestic prices and ensure they were initially criticised by adherents of that inflation expectations are well anchored. conventional monetary policy tools. It was also expected to stimulate increased In the view of some critics for instance, our capital inflows to the country, which should FX policies constitute exchange restrictions, improve accretion to reserves. rationing of FX, discretionary allocation • Conserving our Foreign Exchange (FX): based on priority categories, and a multiple We introduced demand management currency practice. Many are also unaccepting approaches to conserve our reserves and of our 41 items restriction and its recent in- support domestic production of certain crease to 43 items, regardless of its apparent goods in Nigeria. In this regard, we analysed successes. While there is sufficient evidence our import bill, and encouraged manufactur- of significant reductions in our annual import ers to consider local options in sourcing their bill, increased non-oil output and exports, raw materials, by restricting access to foreign and a robust BOP position, these critics assert exchange on 41 items (now increased to 43). that we are restricting trade and creating Four of these items alone constitute over N1 unfair competition. trillion of our annual import bill. To our critics, who are against the imposition • FX Market: In April 2017 we introduced of the FX restrictions, conventional Monetary an Investors and Exporters (I&E) window, Policy requires that to encourage domes- which allowed investors and exporters to tic production, we should impose higher purchase and sell foreign exchange at the tariffs and levies. However, our experience • The Anchor Borrowers Programme (ABP) in Nigeria has shown that this practice has prevailing market rate. In addition, exchange which was launched in November 2015, was rate management was further liberalized fol- never worked due to certain inefficiencies in designed to build partnerships between attaining these objectives. lowing the operationalisation of the “Revised small holder farmers and reliable large-scale Guidelines for the Operation of the Nigerian agro-processors, with a view to increasing Our development finance initiatives in Inter-bank Foreign Exchange Market” in agricultural output, while improving access growth driving and employment generating June 2016. The commencement of this to credit for farmers. sectors have equally not gone down well policy guideline introduced the Naira Settled with the proponents of conventional mone- Foreign Exchange Futures Market. • Our targeted focus on the agricultural and tary policy tools. While they acknowledged industrial sectors were driven by the vast op- • Risk-based supervision: The weakening of our measures have had a positive impact on portunities for growth in these sectors given output and employment, they assert that the naira, following the shift to a more flexi- our high population. It was also instrumental ble foreign exchange mechanism along with these tools constitute quasi-fiscal activities. in taking Nigeria out of the recession. In They also maintain that implicit interest the exposure of several banks to the oil and 2017, over 50 percent of the contributions to gas sector, impacted somewhat on the bal- rate subsidies can have distortive effects on GDP growth came from the agriculture and resource allocation. ance sheets of domestic banks. To support industrial sectors. the health of the banking system, the CBN Our argument for the unconventional took a number of steps, including: These sectors have the ability to absorb the Monetary Policy approach has always been growing labor pool of eligible workers in our that just like fiscal, monetary Policy could, Monitoring compliance of supervised effort to meet the household consumption institutions with the foreign exchange at a time when development challenges needs of the Nigerian populace. If efforts were abound, complement the efforts of the fiscal management framework issued in June made to improve productivity gains in these 2016 through our risk-based supervision in employment generation, wealth creation sectors, it will reduce our dependence on im- and attainment of other growth objectives. methodology. ported items that could be produced in Nigeria. Policy outcomes and exit from recession Monitoring the financial position and perfor- • Furthermore, improved productivity in mance of supervised institutions; the agriculture and manufacturing could Regardless of these scathing views and Assessment of the risk profile and gover- also help in reducing our dependence on critiques, the fact remains these unorthodox nance management practices of banks proceeds from crude oil. policies were well -conceived, and has been yielding significant gains for the Nigerian and in the event of major deteriorations on In 2017, Nigeria’s total revenue from exports any key risk indicator, we engaged with the economy. Noticeable successful outcomes of crude oil was US$23 billion, relative to are gleaned from: affected bank in order to mitigate concerns Indonesia, which earned close to US$22bn and shore-up their capital base. from the export of palm oil in 2017. Nigeria i. GDP – After five consecutive quarters of Development finance intervention: The CBN has vast amounts of arable land that can be negative growth beginning in the first quar- increased its lending to the agricultural and put to good use in the cultivation of not only ter of 2016, a coordinated approach by the industrial sectors, through targeted interven- palm oil but also cotton, cocoa, tomatoes fiscal and monetary authorities supported tion schemes such as the Anchor Borrowers and rice to mention a few. Supporting a rebound in the nation’s economy during Programme, Commercial Agricultural Credit growth in the agriculture and industrial the second quarter of 2017. The recovery has Scheme and the Real Sector Support Facility. sectors is critical in our efforts to create a been driven largely by improved non-oil ac- In particular, we sought to improve domestic diversified wealth base for the country. tivities especially the agriculture sector which supply of four commodities (rice, fish, sugar, expanded consistently by about 3.5–4.3 Doctrinal critique of our policies by Bret- per cent reflecting efforts at diversifying the and wheat), which consume about N1.3 ton Woods trillion annually in our nation’s import bill. economy. This was nonetheless, reinforced While many of these measures were an by the pickup in the oil sector as oil prices 3119 FINANCE JUNE 2019 rallied in 2017. The recovery, which has been In Argentina, though the economy inadvertently cause liquidity surfeit and sustained for eight consecutive quarters, was in recession throughout 2016, undermine price stability. is expected to strengthen in the short- to moderate upticks which peaked at 1.9 percent quarter two of 2017 Developmental roles may expose central medium-term. ended that recession banks to undue political pressure to the ii. Inflation – As a result of the implementation detriment of the economy. of a tighter monetary policy regime, intervention programs in the agriculture and indus- Balance Sheet – Following the 2008 finan- trial sectors, as well as improved FX inflows, cial crisis, many central banks, including inflation began to decline, from its peak of 18.7 those of key advanced economies, quickly percent in January 2017. It currently stands at realised the inadequacy of the conventional 11.37 percent as at April 2019. approach as they hit the lower limits of adjustments to their interest rates. They iii. Reserves – The introduction of the I&E thus looked for other approaches to bolster window, along with improvement in domes- the real economy. These banks (includ- tic production of goods have helped shore Strikingly, it will be discovered that Nigeria ing the US Fed, the Bank of England, the up our external reserves. Transactions have did not fare badly vis-à-vis other emerging European Central Bank, the Bank of Japan, reached over $48 billion since the inception market economies like Brazil, South Africa, among others) experienced considerable of the window and our foreign exchange Turkey, and Argentina, that had similar expansions of their balance sheet while reserves has risen to US$45bn in April 2019 economic experiences. Amidst the growing adopting an unconventional monetary from US$23bn in October 2016. Nigeria’s challenges, Nigeria has managed to keep policy approach. current stock of external reserves is now able real GDP growth positive and has avoided to finance over 9 months of current import Their experiences show that growth financ- a double-dip recession in contrast to some ing monetary policy may lead to unsustain- commitments. With improved availability of other emerging markets economies. foreign exchange, the exchange rate at the ably expanded balance sheet of the central I&E FX window has remained stable over In comparison and following its 2016 contrac- bank especially if there are no robust means the past 24 months at an average of N360/ tions, the South African economy recorded a of contracting the balance sheet when the US$, and the parallel market exchange rate double-dip recession with renewed contrac- need arises. An expanded balance sheet has appreciated from N525/US$ in February tions of 2.6 and 0.7 percent in the first and could portend inflation risk (as monetary 2017 to N360/US$ today. second quarters of 2018, respectively. Its econ- aggregates grow) and financial stability risk omy grew by .8 percent in 2018. In Argen- (due to excessive credit expansion). iv. Anchor Borrowers Programme – The pro- tina, though the economy was in recession Regardless of these probable complexities, gramme has helped to bolster agricultural throughout 2016, moderate upticks which production by removing obstacles faced by the cost-benefit analysis of undertaking peaked at 1.9 percent quarter two of 2017 unconventional monetary policies indicates small holder farmers. We have also improved ended that ”recession. However, the Argentin- access to markets for farmers by facilitating that the societal gains of such policies out- ian economy fell back into a recession as GDP strip whatever challenges that may subsist. greater partnership with agro-processors growth declined by 1 percent in 2018. and industrial firms in the sourcing of raw The experience since the global financial materials. So far the program has supported The Brazilian economy had been in recession crises show that growth consideration more than 1,059,604 small holder farmers since 2015 and only emerged from it the cannot be sacrificed over the long-term across all the 36 states of Nigeria, in culti- first quarter of 2017 with a growth rate of 1.0 for an exclusive focus on price stability, be- vating 16 different commodities over 1.114 percent. Since then the growth has slowed cause unabated real contractions (and the million hectares of farmland. It has also sup- progressively until the last quarter of 2017 associated persistent negative output gaps) ported the creation of over 2.5m jobs across when growth remained flat. Economic recov- can only lead to declining potential output, the agricultural value chain. ery still remains tepid with a GDP growth rate an outcome which is entirely dangerous for of 1.1 percent in 2018. any economy given the structural fall in its v. Industrial Sector – Activities in the industrial long-run growth trajectory. sector also witnessed significant improve- Possible complexities of heterodox mon- ment between August 2016 and February etary policy Way forward 2019, as the Primary Manufacturing Index While developmental mandate enhances Ladies and gentlemen, relative to our peers, rose from a low of 42 percent in August 2016 the ability of central banks to foster econom- the favourable outcomes and strength- to 57 percent in April 2019. This develop- ic growth, this may come with appreciable ening outlook of the Nigerian economy ment was attributed to sustained supply of hitches. Essentially, policies designed to attain is traceable to the timeous adoption on FX and the dogged implementation of our price stability may in fact lack congruence non-traditional policy methods. The CBN FX restriction on certain items. with the goal of economic growth. There is, has been able to reduce inflation, build our vi. Because of our unconventional FX and de- therefore, the need for a clear understanding FX reserves, maintained FX market stability, velopment finance policies we have recorded of what the limits of central banks are when and foster real growth. Nonetheless, chal- spectacular improvements in domestic pro- it is compelled to assume a growth mandate lenges still remain. The pace of population duction of most of the targeted items. Local together with the traditional price stability growth at about 2.6 percent still outstrips manufacturers are consequently reporting goal. Some of the challenges include: real growth rate while inflation is outside major boosts to their revenue and profit. our tolerance band. Unemployment rate Multi-mandate risks: Some of the risks that and incidence of poverty remain at unac- Peer review might arise from central banks’ increased ceptable levels. mandate are identified; In assessing Nigeria’s recovery efforts and Culled from a paper delivered by Emefiele performance, it is essential to conduct Trade-offs may possibly arise from the pur- at the distinguished leadership programme a comparative assessment of our peers. suit of growth and price stability objectives. lecture series at the University of Ibadan last Unconventional monetary policy tools could month 32 FINANCE FINANCE JUNE 2019 the assurance at a meeting with the representatives of the investment partners of NSEZCO, including the African FED GOVT Export-Import Bank, Bank of Industry, Nigerian Sovereign Investment Author- ity, Africa Finance Corporation and the African Development Bank (AfDB) and ASSURES the legal advisers, Aluko & Oyebode. Osinbajo condemned the recent misrepresentations that werecreated about NSEZCO in certain sections of FIRM OF the media and regretted the embar- rassment this might have caused the investors. He reaffirmed FG’s endorse- ment of the strategies and plans put in COMMITMENT place for the actualisation of the SEZs. The VP assured the investors of the readiness of the Buhari administration TO ECONOMIC to support their investments. Bank of Industry Managing Director, Olukayode Pitan and Regional Chief ZONES Operating Officer, Anglophone West Africa, African Export-Import Bank, Abdoulaye Kone, who spoke on behalf By Meletus EZE Investment Company Limited (NSEZ- of the investors and Gbenga Oyebode CO) of its commitment to the develop- for the advisers thanked the Federal he Federal Government has as- ment of special economic zones across Government for the assurances and sured the strategic investment the country. confirmed their commitment to the partners and advisers of the project. TNigeria Special Economic Zone Vice President Yemi Osinbajo gave CONCERNS OVER BANKS’ NPLS, FOREX EXPOSURE By Meletus EZE money banks’ total credit declined by justified by subsequent developments about 2.5 per cent, year-on-year. This particularly as shown by the CIEA, PMIs, he Central Bank of Nigeria (CB- trend needs to be halted in the face of and the outlook for the oil sector. N)-led Monetary Policy Commit- the prevailing sluggish performance of tee (MPC) has expressed worry economic activity. In this context, the role “My conviction about the merit of easing over the concentration and high of other financial institutions (OFIs) in the the policy stance around this time non-performingT loans (NPLs) in banks. has been further strengthened by the credit arena becomes important,” he said. increased opportunity for doing so. First, The committee decried the persistent He explained that these institutions all the measures of inflation continued risks in the financial system, especially (micro-finance banks, finance companies, to trend downwards in February with an the high foreign exchange (Forex) expo- mortgage banks, development finance outlook for achieving single-digit core sure of banks, particularly to entities that institutions, among others) are expected inflation by August. This means that the do not earn forex. to play the very important role of closing real challenge remains food inflation, CBN Deputy Governor, Edward Lametek, certain gaps in the financial system, which may be more effectively addressed a member of the MPC, disclosed this in a including crucially, financial inclusion. through actions aimed at boosting pro- statement on the MPC meeting, posted As such, they need to be encouraged to duction and easing distribution bottle- on the CBN’s website. He reiterated that remain mission-focused. necks,” he said. the concentration and high NPLs were “Overall, the balance of risks continues Lametek explained the CBN’s interven- also of concern to the apex bank. to be tilted against economic growth. In tions in agriculture would continue to be He however, said payment of contractor my January 2019 statement, I empha- relevant; domestic yields had declined debts by the Federal Government would sised the need to support growth given with the one year treasury bills rate at go a long way in reducing the pressures the weak outlook for economic activity about 13 per cent; the monetary policy in banking, and that improved surveil- based on indications from the oil sector stance needed to be in sync, especially as lance and deployment of sanctions (especially the volatility in crude prices inflow of portfolio investments remained against regulatory infractions would en- and production cuts) and sluggish con- high. gender good governance and stability. sumption demand. Of course, I noted that more clarity over the next two months He added that the relatively good level of “This is important because financial (February and March) would be helpful in external reserves and growing confidence intermediation, especially provision of deciding the direction of monetary policy in the economy offer some guarantee of credit, is highly dependent on the state beyond third quarter of 2019,” he said. adequate supply of forex to the market of health of financial institutions. At from both the CBN and autonomous end-February 2019, the stock of deposit “Clearly, the indications then have been sources. 3319 FINANCE JUNE 2019 By Abisola THOMPSON overnor of Central Bank of Ni- SMUGGLING, DUMPING, CHALLENGES geria (CBN), says the bank, with some stakeholders, have iden- TO ECONOMIC POLICIES – CBN tified smuggling and dumping Gas major challenges sabotaging the Nigerian economic policies. The governor said this on the sideline of a consultative roundtable titled, “Going for Growth” with some economic stakeholders in Lagos. The essence of the roundtable was to encourage participants to highlight important building blocks that will lead to greater economic growth in the country. It also involves the CBN Governor listen- ing to their ideas and views on how productivity and investments by companies operating in Nigeria can be improved. Others include how to reduce the nation’s dependence on imported goods and increase exports of non-oil goods and services. to provide all details about them. would come up with the names of those that had been identified. Emefiele said: “We have identified smug- “We investigate their accounts and if they glers and people dumping goods as are found in economic sabotage, board- “We want to be sure that we come up those who sabotage those policies and ing, smuggling and dumping in Nigeria, with something that is credible and we decided that we will deal with them. we would not only block their accounts, cannot be denied. At this stage we have The strategy that we came up with is that we would close their accounts in all the already blocked the accounts of some in we will not bother ourselves with them. Nigerian banks simultaneously. the textile and rice and palm oil company. “There is an agency of government that He also said the CBN asked commercial “We are investigating those accounts is responsible for border control and if banks to close those companies’ accounts and as information becomes clearer, we these people pass through the border and those of the top members of such can clearly say that they committed the control we would use the instrumentality entities. offence. of being the regulator of the banking sys- The bank chief said CBN in due course “We would then go to the next level tem to make sure that we get the banks SEC, EFCC PARTNER TO TACKLE CRIME IN CAPITAL MARKET By Meletus EZE Uduk also said the visit was aimed at agement of SEC for the gesture and revisiting the Memorandum of Under- stressed the need to strengthen collab- he Securities and Exchange standing (MoU) signed between both oration between both agencies. Commission (SEC) and the organisations on Jan. 19, 2017. Economic and Financial Crimes Magu assured SEC team of EFCC’s sup- Commission (EFCC) have According to her, some areas where the port in ensuring that clauses embed- agreedT to collaborate to tackle crime in MoU seeks cooperation of both agen- ded in the MoU were executed given the Nigerian capital market. cies include training and secondment the magnitude of fraudulent activities of middle cadre officers of SEC to EFCC presently going on in the country. SEC’s Director-General, Ms Mary Uduk, and those of EFCC to SEC. said this in a statement signed by the He reiterated the need for joint training Head of Media, SEC, Mrs Efe Ebello, in She said other areas were cross board- of staff of both organisations, saying Abuja. She said the agreement was er asset seizure, repatriation of stolen there was the need to review the MoU reached when the management of SEC funds from the capital market and pros- in order to achieve both organisations’ met with the management team of ecution of offenders among others objectives. EFCC at the EFCC Corporate Headquar- Uduk said both organisations had On the rising spate of Ponzi schemes in ters in Abuja. worked together on some cases in the the country, Magu stressed the need for She said the visit was necessary to past and there was no better time for more sensitisation campaigns between close ranks in the face of re-awaken- them to collaborate more closely than SEC and EFCC. ing of Ponzi schemes, cybercrime and now. This, he said would ensure that unsus- other fraudulent activities that had en- Acting Chairman of EFCC, Mr Ibrahim pecting Nigerians do not continue to gulfed the market in the last few years. Magu, thanked the Executive Man- lose their hard earned money. 34 FINANCE FINANCE JUNE 2019 IMPACT OF BANKS’ ACCESS TO GOVT SECURITIES DEPENDS ON CBN MECHANISMS – DMO which has shifted more of the Federal By Olamilekan FAWAS Government’s borrowing to external he Debt Management Office sources, is to create borrowing space for (DMO) has said the impact of the the private sector in the domestic market. proposed limitation of commercial “Between 2017 and 2018, the Federal banks’ access to government secu- Government repaid over N1 trillion of ritiesT on the market will depend on the Nigerian Treasury Bills (NTBs), to make actual mechanism provided by the CBN. loanable funds available to private sector The Director, Portfolio Management borrowers and also lower interest rates in Department, Debt Management Of- the market. fice (DMO), Mr. Oladele Afolabi, said: “This saw the rates for NTBs dropping “For instance, how would ‘Government from about 18.5 per cent in 2017 to be- Securities’ be defined? Would this include tween 10 to 11 per cent in 2018. the Open Market Operations (OMO) Bills being issued by the Central Bank of •Oladele Afolabi “So, to the extent that the objective is to Nigeria (CBN)? make more funds available to the private “This is a sign of maturity of the Federal sector, this is in accordance with the gov- “The specifics of the mechanism would Government bond market and we ex- ernment’s focus.” determine the impact on the market. pect to continue to diversify the investor Afolabi, however, said that banks were He, however, assured that the limitation base for government securities particu- still expected to continue to play a key will not affect the market or discourage larly with new instruments such as the role as investors in the market. investors. Sukuk, Savings Bond and Green Bond. This, he said, was because the Federal He said the Federal Government bond He said they were attracting new inves- Government bonds were liquid assets market had developed over the years tors to the market. Afolabi explained that which the banks would need to hold to from the initial period when banks were making funds available to the private meet the 30 per cent liquidity ratio. the dominant investors to the present sector was also the focus of the Federal situation where there were now other cat- Government as the Economic Recovery The Monetary Policy Committee (MPC) egories of investors. and Growth Plan (ERGP) expected the meeting in May had directed the CBN Afolabi said the new categories included private sector to play a major role in the to initiate policies and mechanisms that the pension funds, asset managers and country’s development. would facilitate the restriction of banks’ access to government securities such as foreign investors, all with significantly According to him, the DMO’s initiatives treasury bills and bonds. higher levels of participation than before. in the bond market are not just for the The director added that the DMO had Federal Government’s borrowing, but to The committee said the restriction was been working with other stakeholders also create a market for long term capital necessary because banks had unfettered to encourage higher level of issuances for other categories of issuers, such as access to government securities, a situa- by private sector organisations and the sub-nationals and corporates. tion that had the capacity to crowd out private sector lending. Federal Government granted tax waivers “The current Debt Management Strategy, in that regard. NBS TO PUBLISH CORRUPTION SURVEY FINDINGS IN SEPTEMBER – OFFICIAL By Meletus EZE Household Statistics said that field workers had been deployed and the survey would be releasing the result. On or before September, n official of National Bureau of completed by the end of June. Statistics (NBS), Dr Isiaka Olarewaju, the result will be made public by the Statisti- has said the bureau will publish the “The planning of the survey started since cian-General,” he said. findings of the ongoing survey on 2018 and we did testing on instrument of The director said a total of 20 field personnel Acorruption in September. data collection in February, 2019. had been deployed in each state including the The survey is the second National Household “This survey is a large one. We have since FCT; four teams constituted in each state and Survey on Quality and Integrity of Public moved away from analogue to electronic, as a team comprised of one supervisor and four Services in Nigeria, 2019. we talk to you, we are monitoring those on field. enumerators. We monitor the location of enumerators from Olarewaju said the survey would allow Olarewaju, Project Director of the Survey, the digital address of sample households. represented the Statistician-General, Dr. Yemi government and citizens to examine level of Kale, disclosed this while fielding questions “As soon as the data collection is finished, progress within the last two years particularly from newsmen on the Survey in Abuja. it will be available within one week, but given that the current government has big we need to do data reliability test before anti-corruption stance. The Director in Charge of Real Sector and 35 JUNE 2019

TRAFFIC GRIDLOCK: WILL EXECUTIVE ORDER DO THE MAGIC? The first Executive Order of administration than the executive order, which showed the capacity to tackle the traffic situation Governor Babajide Sanwo-Olu’s came into force on May 30, barely 24 hours after when he visited some of the major grey points in administration has shown how he assumed office as the state’s fifth executive the metropolis, assuring that his administration ‘desperate’ Lagos State is in getting governor. would provide solutions to the traffic snarl in the state. not only the people moving, but also For Lagos motorists, only very few unpleasant the state’s economy, writes Abisola things could surpass traffic gridlock. Many could In a paper delivered at the African Forum of the THOMPSON have opted to leave the state, but its economy is Chartered Institute of Logistics and Transporta- simply irresistible. So, rather than exiting, more tion (CILT) at Arusha, Tanzania by the Assistant people keep trooping in, compounding the Corps Marshall of the Federal Road Safety Corps he Lagos State Transport Management economy and making nonsense of the state’s (FRSC), Kayode Olagunju, entitled: “Evaluating Authority’s (LASTMA) new slogan in one transportation plan. traffic congestion in developing nations, a case of its advertisement against one way study of Nigeria”, he listed major causes of con- Successive governments had tried to resolve the driving seems to have struck a chord with gestion to include lane indiscipline, high traffic traffic situation with massive road constructions LagosiansT who have in the last one week begun density, low road network carrying capacity and and opening up of inner roads but their efforts to appreciate that “a new Sheriff is in town”. poor traffic management. appeared like scratching the problem on the sur- Nothing else underscores how central trans- face. Barely two weeks after being sworn in, the Other causative factors, according to him, are portation is to the Babajide Sanwo-Olu’s immediate past governor, Akinwunmi Ambode, poor road support infrastructure, such as lay-by, 36 TRANSPORTATION JUNE 2019 low response to removal of broken down and “The order has put paid to thinking in certain sheds where those who may not be able to crashed vehicles and poor integration of urban quarters that the Sanwo-Olu government may return to their homes at night could repose for transport planning. be soft on traffic offenders. Right in front of the night,” Musa said. security chiefs in the state, the governor gave Sanwo-Olu’s Order, which could be interpreted Musa, however, sued for commuters’ under- LASTMA the marching order to strictly enforce all as a declaration of a state of emergency on standing to reduce frictions that usually put his extant laws relating to transportation,” he said. transportation, sought to address three thematic men at risk on the field. areas that have bedeviled the sector. They are Opeifa said no agency of government has “We would urge Lagosians to understand that road infrastructure, environmental impact and suffered more in the last four years than LASTMA, we are partners and not enemies. Our desire is traffic management. many of whose officials were attacked, maimed to ensure that everyone moves freely in the state and killed by irate citizens just for doing their Transportation holds the key to unlocking the and we would continue to do this without fear legitimate job of keeping traffic moving in the nation’s economic potential. For so long, Lagos or favour,” Musa said, adding that the agency was state. has been bedeviled by the transportation getting worried that some unscrupulous drivers plague. The state, which hosts major drivers of However, as the state seemed bent on traffic (both commercial and private) were fond of the economy, the ports (both sea and air) and management, it understood that no success abducting its officers, beating and abandoning the nation’s financial headquarters, has been could be achieved if the roads remained bad. them in desolate places. held back by a dreary transportation system that With virtually all its 9,600 inner road network “Every week, we receive reports in our situation has relied almost exclusively on the roads. in various stages of dilapidation, the governor room of our officials being abducted by culprits recognised that nothing tangible could be done So grave has the impact of the gridlock to the in the course of enforcing traffic regulations, except the roads are fixed. nation’s economy been that the Lagos Bureau beaten mercilessly before being released or in of Statistics said the state, whose population is Not only did he mandate the LSPWC to embark some cases the officials escaping before more estimated at 25.6 million, loses about two billion on aggressive remediation of all critical roads harm could come their way,” he said. hours yearly. A moving transportation sector, across the state, the governor, as part of efforts at He disclosed that the agency has been therefore, remains the key to unlocking the ensuring that all roads are touched, promised to organising regular training and retraining of its economy. Lagos Chamber of Commerce and release emergency toll-free telephone numbers workforce to drive down a re-orientation needed Industry President, Mr Babatunde Ruwase, said through which Lagosians could report all bad for better civil engagement to promote good recently that Nigeria loses between N5 and N7 roads in their areas. relationship with motorists. trillion yearly to gridlock. At a public forum, the governor directed the LSP- Olawale added that the agency had tried to Signing the Order, which came, Sanwo-Olu de- WC to swing into action. LASTMA’s General Man- stop physical enforcement of traffic offences, but clared that Lagosians were in a hurry to see the ager, Olawale Musa, said the agency is prepared was being stalled because of lack of data. He, enthronement of discipline on the roads. “The to comply with the governor’s directive. Musa therefore, called for public understanding, saying order was to address issues, such as potholes, said the 4000-man strong agency may even run that rather than taking the law into their hands, blockages and the rest of it,” he said. three shifts at some locations that are notable for erring officials should be reported to the agency traffic gridlock. He disclosed that efforts were in To address these issues, he mandated the state’s for appropriate disciplinary actions. top gear to provide security backup for its men Drain Ducks Agency, to clean all the drainage whose shift runs into the night. “LASTMA is being paid from their taxes. The and de-silt all primary, secondary and tertiary government employed these officials to work drainages to ensure free flow of rainwater, “Our men have been adequately briefed and in their interest to keep the roads free, so they especially during the rainy season and the they are very enthusiastic in cooperating with should cooperate with us. We are there for them blockade that usually results to ponding on the the administration in keeping the state moving. to ensure that they have free flow of traffic. roads. He directed the Lagos State Public Works In some places we are planning to have working Corporation (LSPWC) to start road patching and rehabilitation. Sanwo-Olu by fiat, directed LASTMA to operate two shifts. “Our desire is to ensure that we control traffic until everybody gets home safely. LAST- MA should, therefore, extend its working hours and ensure traffic control till 11p.m,” he said. He instructed LASTMA and the Vehicle Inspec- tion Service (VIS) to ensure compliance with traffic rules and regulations. He said: “Lagosians are not going to wait for us any longer to maintain orderliness on our roads. Hence, I have invited all the Security Chiefs to witness the signing of the Executive Order so that they can hear us and support us.” It was the first time, according to Kayode Opeifa,a former Commissioner for Transportation in the state and immediate past Executive Secretary for Transportation in the Federal Capital Territory Authority (FCTA), any government in Lagos will back LASTMA’s activities with an Executive Order.

37 TRANSPORTATION JUNE 2019 ‘WE PLAN TO RUN EFFICIENT, SUSTAINABLE AIRLINE’ By Meletus EZE hat has Ibom Air, the new entrant into the airline business, got to offer? Plenty, says its Chief Operating Officer (COO), George Uriesi, who Wnoted that the airline invested in Bombardier Canadian Regional Jet J900 (CRJ 900) aircraft because of their suitability for Nigeria. Besides being cost-effective, the aircraft are equipment suitable for the route and operational structure developed in the carrier’s business plan, he added. Speaking at the airline’s inaugural flight on the Uyo – Lagos- Lagos – Uyo route, Uriesi said Ibom Air was investing in modern planes to ensure reliable services by a carrier that has designed few routes structure in its business plans. Uriesi, a former managing director of the Federal Airports Authority of Nigeria (FAAN), said the gest CRJ900 on the continent. The fourth one will not a government parastatal. carrier would fill the gaps in the air transport val- come in in August. Again, the fifth aeroplane will “The proposition is schedule reliability, on-time ue chain, and assist to develop the Akwa Ibom come in the first quarter of 2020. But if the num- departures and superior customer service. Nige- airport, including the aircraft maintenance repair bers are achieved before then, then we can bring rians can plan against our schedule. Secondly, and overhaul centre. it forward. It is going to be organic expansion if we are leaving at 7am, we are leaving at 7am. over the next three years. There are indications He said Ibom Air was conceived to provide more The third is superior customer service when you that it is going to be faster than slower.” reliable air transport services, deploy right aircraft interact with us. on the route and design passenger friendly fares. The establishment of Ibom Air , he said, was ‘We believe that we are an airline that provides part of the grand desire to make Akwa Ibom a Uriesi said: “We looked at the B737 and it is this tripod of services to the passengers.” destination of choice for Nigerians and visitors to obvious we looked at the economics of the the country. The, Engineering Director, Lookman Animasuan, operations of the Embraer and the CRJ900 and said the airline had a fleet maintenance unit, eventually we opted for the CRJ. The pros were Uriesi stated: “Because of the airline now, the with young and talented Nigerian engineers more than the cons. Investing in more modern MRO will very soon become established proper- trained to familiarise with the CRJ aircraft type. aeroplanes means that we have a longer period ly. The airline is designed to be very well run. It is of more reliable services and in terms of business plans, that is much better for us. Besides, the equipment is the right one for this route struc- NPA PROMISES SAFETY ON PORT ACCESS ture.” ROADS, IMPROVED STAFF WELLNESS, OTHERS Uriesi said the airline’s vision was to be a world By Olamilekan FAWAS ensuring that all necessary measures are taken in class regional carrier. providing a secured and friendly environment for he Nigerian Ports Authority (NPA) has customer satisfaction and efficient service delivery. He said: “We don’t have any ambition for long assured ports users of safety and access haul at all. We will settle in the country and after to already cleared cargoes from the He said: “We regret any inconvenience this a while we will go into the region. We want to seaports. accident may have caused the general public, model ourselves around Comair of South Africa. T especially the port community, and assure of This is coming as the Federal Government They have been in existence for about 75 years. prompt response to issues when they occur.” They have been profitable for 72 of their 75 years. extended by two weeks, the time given the Pres- They are such a world-class airline that British idential Taskforce on the Apapa traffic gridlock Meanwhile, the NPA has reassured its staff of Airways has put their livery on it. They operate to resolve the matter, following a request for unflinching support prioritizing health issues franchise for British Airways. They have no ambi- an extension by members of the taskforce and concerning its employees to derive the best tion to go anywhere other than Southern Africa. other stakeholders. service delivery. That is the type of model we are after.” The General Manager, Corporate and Strategic Managing Director, Hadiza Bala Usman, at the year- He said Ibom Air plans to grow its fleet of aircraft Communication, NPA, Adam Jatto, expressed ly “Workers Wellness Programmes Fair”, held at its from three to 10 CRJ900 aircraft in three years. regrets over the accident that involved a 40 feet Headquarters in Lagos, said all workers should key container that crushed three fairly used vehicles into the theme of the programme, “Eat Right, Keep Uriesi said: “Already, the carrier is starting with at Tin Can Island Port in Lagos. Fit, and Enhance Productivity” which was in tandem three airplanes while the fourth aircraft will be with NPA’s core values of upholding efficiency and Jatto said the NPA assures its various customers added in August. We are going to have the big- engendering greater customer satisfaction. and stakeholders of continued responsibility in 38 TRANSPORTATION TRANSPORTATION JUNE 2019 IMPROVING AIRPORT FACILITIES FOR NIGHT FLIGHTS

The collaboration of Edo State try are quick to note that this effort by the state Airport attain international standards. Government and some aviation government will help stall the loses incurred by airlines due to their inability to fly in and out of The airport, though a Federal Government fa- agencies has facilitated the any airport for 24 hours because of inadequate cility, Edo State assumed part responsibility for installation of Category Two (CAT operational facilities. its facility upgrade estimated at N169 million. II) Instrument Landing System (ILS) Besides providing part funding for the project, and Distance Measuring Equipment This singular factor, according to experts, has contributed to the bust and boom circle of aviation agencies including Federal Airports (DME) at the Benin Airport. Analysts many indigenous carriers. Authority of Nigeria (FAAN), the Nigerian believe with such collaboration, Airspace Management Agency (NAMA) and there is hope for improved Rationale for Edo State’s initiative Nigerian Meteorological Agency (NIMET) navigational equipment at airports, provided the needed infrastructure comprising According to the state government, its inter- high-end air navigation equipment. Meletus EZE reports. vention at the Airport was predicated on con- victions that if airports are fully developed with Tour D’ Benin he Federal Government’s drive to appropriate operational facilities, they could During a visit by top aviation actors in the equip its airports with state-of-the-art open up sub-national economies for growth. country to the state in September 2017, Gov- navigation and weather equipment has ernor Obaseki was quick to relay his desire to received a boost. At the Benin Airport, The aerodrome, government further reasoned, improve infrastructure at Benin Airport. theT Edo State Government, in collaboration is part of the facilities in the economic value with some aviation agencies, has installed chain, which influences expansion of economic activities by not only freeing up markets, but He said though the Federal Government had a Category Two (CAT II) Instrument Landing the mandate to fix the airport, being its owner, System (ILS) and Distant Measuring Equipment providing the enabling environment to attract private investments. yet, there was need to strengthen partnership (DME). to refurbish the airport. The facility upgrade was part of efforts by the Besides, an efficient airport fitted with the right navigational facilities for 24-hour flight services, Obaseki, who conveyed his administration’s government to scale up flight safety, especially intention to the former FAAN Managing Direc- at some airports designated for international will deepen the vision of any administration to industrialise the state. tor, Saleh Dunoma and his NAMA counterpart, standards. Capt. Fola Akinkuotu after embarking on a tour of facilities at Benin Airport, said he would work Prior to this, Benin Airport was among many Edo State was convinced that airports that are with them to develop a plan to expand the aerodromes that lacked requisite air naviga- truly functional for both day and night flights, airport space. tion facilities for night flights, meaning flights besides driving the state’s industrialisation operations at the aerodrome only took place vision, could be leveraged by private investors to access business opportunities. He said the state intended to effectively utilise between 7.00 am and 6.00 pm at the facility, assets and resources within the state for the thus qualifying it as an aerodrome for Visual Strategies for facility upgrade benefit of the people, which necessitated the Flight Rules (VFR). inspection of the airport. In 2017, Governor Godwin Obaseki of Edo State Therefore, the joy of installing the new facility started a campaign aimed at upgrading Benin “We have approached the Federal Authority to could be understood, considering the fact that Airport to international standards. kindly come to our aid regarding the airport. Benin Airport ranks among the first eight in the The plan is to first improve the facilities in this country, with commanding passengers traffic From studies carried by aviation experts, the airport and ensure that we have night landing for scheduled carriers. state government unearthed obvious gaps in facilities. This will enable the airport embark airport and air navigation facilities that could on 24 hours operation. With more airplanes For instance, stakeholders in the aviation indus- be a road block to the dream of making Benin coming in, we will see a lot more passenger 39 TRANSPORTATION JUNE 2019 XXXXtraffic coming into our state,” he said. “The operational capacity of the Benin City Airport has tremendously improved as we can ‘WHY NIGERIA’S A visibly impressed Dunoma noted that now guarantee safe landing in reduced visibility though the Federal Government had the and in bad weather condition. Aircraft can now IMPORT, EXPORT responsibility to improve facilities at Benin land in Benin Airport at night. No more closure Airport, he was excited by the commitment of the Airport by 6 pm. “We have both ground PROCEDURES that came from the governor to upgrade the and satellite-based equipment at the Airport in airport. such a way that if the ground base equipment FAILED’ Akinkuotu commended the joint effort by the fails, the satellite base equipment will work to By Abisola THOMPSON state and Federal Government on the upgrade, ensure safe landing at the Airport either in the noting that the approach was the way to go day or at night,” Sirika said. igeria’s import, export, regulatory and to drive meaningful development across the Speaking on further plans to maximise the transit procedures are encumbered by country. use of the airport, Sirika said preparations lengthy procedures associated with un- necessary delays, high transaction cost, He said the agency would collaborate with the have reached advanced stage in building an Nand increase of cargo dwell time, which make Edo State to ensure that passengers do not Agro-allied Cargo Terminal at the Benin Airport, the local ports among the most expensive in only feel safe, but have good reasons to fly to adding that work on the civil structures has the globe. These are the major factors that have Benin Airport. commenced with Governor Obaseki’s support. bedevilled the successful regulation and smooth Collaboration that works He added: “We are bringing a cargo terminal to trade practices in Nigerian seaports, according Benin to facilitate exportation of perishable ag- to the National Council of Managing Directors of Work began after the inspection, resulting in ricultural products and other produce targeted Customs Agents (NCMDCA). the state constructing three security watch- at foreign markets.” towers, suppling and building houses for National President, NCMDCA, Lucky Amiwero, 220KVA generators, provided three Hilux trucks On his part, Governor Obaseki said with the in a letter to President Muhammadu Buhari, said to FAAN and facilitating the installation of CAT II installation of the equipment and commence- all these factors contribute to the inefficiencies in ILS and DME by NAMA. ment of night landing facilities, the Airport can the port system coupled with low draught level now compete with its peers across the world. of the Nigerian ports. The Federal Government, on its part through He commended FAAN and NAMA for their the Nigeria Meteorological Agency (NIMET), working relationship with his administration He described these as the main reasons the provided Thunder and Lightning System, Met for over a year and a half in ensuring that the country lost the transhipment hub status to Enclosure and Secure Aviation Date Informa- upgrade became a reality. other West African countries. tion System while FAAN provided Enhanced Amiwero, who is a former member of the Simple Approach Landing System. On the benefits of the upgrade to the state, Governor Obaseki said the development will Presidential Taskforce on the Reform of Nigeria Osinbajo’s first flight transform the Benin Airport. “The reason we Customs Service, said there is an urgent need for reforms on import, export, regulatory and transit After the completion of air navigation facilities insisted on upgrading facilities at the Benin Airport is that it is one of the five Airports with procedures. Such a move will help to implement at Benin Airport, an aircraft in the Presidential integrated set policy and procedures that are Fleet flew Vice President Yemi Osinbajo out of high passenger traffic in the country. With the facilities in place, we can now convince airlines globally accepted, to ensure effective trade facil- the airport at 7pm to Abuja, the nation’s capital, itation by the reduction of transaction cost,(TC) being the first flight out of the airport after the to make night stop-over in the City to further increase passenger traffic to boost the state’s cargo dwell time (CDT), and ensure safety and facilities were installed. This ends decades of security(SS) of the processes in Nigerian ports. neglect. revenue base.” He said the state facilitated the construction of He said except there is a change in infrastruc- Speaking after the number two citizen’s flight ture rehabilitation, Nigeria will continue to lose had taken off, Governor Obaseki assured that two watchtowers to provide military officers with a vantage point for proper surveillance of cargoes to neighbouring countries, which have Benin Airport would commence night-time deep seaports and better facilities. flight operations in full after the necessary the equipment and the airport. facilities have been installed as they are being Equipment inaugurated at the Airport included Amiwero, in the letter dated May 19th, said it is received in batches. thunder and lightning system, Secure Aviation sad that Nigerian ports cannot accommodate mega ships with 8000-20000 TEUs, unlike According to the governor, the landing facilities Data Information System (SADIS); Enhanced Simple Approach Lightening System, CAT II what obtains in others ports. These are already at the Benin Airport were already working positioned as “millennium ports, preferred, as they enabled the Vice President’s flight to and Instrument Landing System (ILS)/Distance Measuring Equipment (DME). transhipments or load centre,” adding that most depart Benin City at about 7 pm. West African ports were built to accommodate “We are expecting more night landing “All these equipment were put together by the Nigerian bound cargoes given the country’s equipment to be installed at the Benin Airport, officials of NIMET, FAAN, NAMA and Edo State poor infrastructure. especially the lights. “ Government. Two 220 KVA generators and plant house were built by the state govern- He also identified Cotonou, Lome, Ghana, and It’s dream come true ment as well,” the governor revealed. Cameroun as countries, which have either completed their deep sea projects or near com- The Federal Government and Edo State inau- Stakeholders’ / experts’ views pletion, noting that while Nigerian ports draught gurated night landing equipment at the Benin is between 8 and 13 meters, which cannot Speaking on the development, Aviation Airport, thus officially reviving night operations accommodate mega ships, the least draught in Security Consultant, Group Capt. John Ojikutu at the 63-year-old Airport. other ports is 15 meters. (rtd) said night operations provide immense Immediate past Minister of State for Aviation, economic opportunities for cities with such For instance, Lome port is 15.5 meters, Cotonou Hadi Sirika, said he was elated by the devel- operations, as they open up a new vista of 15, Ghana 19 and Cameroun 16 meters, adding opment, commending Governor Obaseki’s businesses for the airlines operating from such that most Nigerian bound goods by mega doggedness and tenacity in facilitating the start airports and the state’s local economy. ships are transhipped from these countries with of night operations at the Airport. smaller vessels. 40 TRANSPORTATION

JUNE 2019 Political Economy

9TH NATIONAL ASSEMBLY: WHAT HOPE FOR NIGERIANS? the bills passed by the 8th senate are Dis- crimination Against Persons with Disabilities (Prohibition) Bill 2015, North East Development Commission (NEDC) Bill 2015, Counterfeit and Fake Drugs and Unwholesome Processed Foods (Miscellaneous Provision) Amendment Bill 2015, Petroleum Industry Governance Bill 2016, Sexual Harassment in Tertiary Educational Institution Bill 2016, Not-Too-Young-To-Run Bill, among others. The Senate also adopted bills passed by the House of Representatives. Some of them are Federal Capital Territory Hospitals Management Board (Establishment, etc) Bill 2016, Senior Citizen Centre Bill, 2016, and Compulsory Treat- ment and Care of Victims of Gunshots Bill 2016. The Executive Director, Youth Initiative for Advo- cacy Growth and Advancement (YIAGA-AFRI- CA), Mr Samson Itodo, commended the Senate Ahmed Lawan for passing the Not-Too-Young-To-Run Bill, • Femi Gbajabiamila which has been signed into law by President Muhammadu Buhari. The 8th National Assembly ended will aid developments and reforms that will on June 11 2019. The 8th National improve the living conditions of Nigerians. Itodo, a co-convener of the Not-Too-Young-To- Run Movement, said though the 8th assembly Assembly took off in 2015 with As clearly spelt out at the beginning by the huge expectations from Nigeri- had challenges, they performed creditably. leadership of the 8th Assembly, the agenda This Legislative Agenda takes lessons from the ans about the way government outlined steps and prioritises legislative actions experiences of the 7th House of Representa- business is conducted. In this piece required to achieve set goals and objectives. tives and seeks to consolidate the gains and Olamilekan FAWAS examines As the 109 senators of the 8th Senate bowed achievements thereof. the activities of the 8th Assembly out on June 6, 2019 after four years of legislative The House of Representatives recognises that hopes the 9th Assembly will learn activities, political analysts have commended there remains widespread citizens distrust of from its predecessor and meet the their performance in spite of the tumultuous public institutions and government generally. expectations of Nigerians. beginning of the session in 2015. It is also recognised that there was a lot of pub- The analysts observed that although the lic misconception and misperception about the session was characterised by some challenges, functions and contributions of the legislature o address the numerous expectations most bills passed by the lawmakers have direct to Nigeria’s overall socioeconomic and political of Nigerians, the 9th National Assembly impact on the economy. development. Yet, the legislature’s contributions has to implement legislative agenda According to the 8th Senate bill progression to Nigeria’s democracy remain critical and that will position it to deliver laws that T chart, over 200 bills were passed. Some of important. 41 POLITICAL ECONOMY JUNE 2019 “The 8th House of Representatives asserted Commission bill, its role in providing leadership in the areas of This Assembly successfully alters many sections of the accountable and transparent government, “Apart from bills which is the core function of constitution, including giving the the Legislature which is to make law, the 8th citizens’ engagement, as well as constituency State Legislature and Judiciary representation. financial autonomy Assembly pursued its representational role as elected representative of the people to The House of Representatives collaborated speak for the people of Nigeria, passed many with its counterpart in the Senate and other resolutions covering all areas of our national life arms of government to legislate for the com- that concerned the people from insecurity to mon good of the Nigerian people. terrorist attacks, murder, kidnapping, killings, education, health, Nigeria in Diaspora, unem- “Our legislative activities covered critical ployment, youth, women, etc. spheres of life in Nigeria. The House legislates to achieve reforms in Nigeria’s national economy “In terms of oversight responsibility of the and development, tackle poverty, unemploy- House, we investigated many of the Ministries ment, confront the scourge of corruption, ter- to expose corruption in line with section 58 of rorism and security challenges in the country. were referred to various committees, 17 were the constitution. It is the deliberations of the House on members motion that get the police “The House also gave priority to green legisla- withdrawn and 1 was deferred leaving a total of 1588. and other government agencies to embark on tions to address environmental challenges such using local governments as a basis for recruit- as desertification, erosion and pollution. The House received and lay on the table, 1192 ment using Federal Character principles”. “The 8th House of Representatives also worked petitions, lay and yet to be consider 22, considered on the floor of the House 205, and re- On his part, Chief Mike Ozhekhome (SAN), assiduously to improve the governance said the 8th national assembly was the best in process in Nigeria by legislating to cut the cost jected 2. 108 of the bills came from the Senate, 1465 of the bills were private members bills”. the legislative history of the country. He said it of running government, reduce wastage and performed creditably in terms of productivity tackle National Revenue leakages. On other areas of achievement of the House and insistence on being independent. during the period under review, he said, “This “The House committed to playing its part in He said: “In the entire legislative history of rescuing Nigeria from the clutches of hunger, 8th Assembly made history by altering the constitution. Nigeria, the 8th national assembly passed the poverty, disease, social, economic, political and largest number of pro-masses motions, resolu- infrastructural quagmire. “This Assembly successfully alters many tions and bills than any legislature before it. sections of the constitution, including giving “The 8th House of Representatives, as a Peoples’ “Future national assembly should and must Parliament, was sensitive to public demands for the State Legislature and Judiciary financial autonomy. take a cue from the 8th national assembly, transparency and accountability not just by the that the assembly is an independent arm of House of Representatives but also by govern- “We also lower the age limit for those con- government, specifically created by Section 4 ment at all levels. testing in” the not too young to run bill, which of the 1999 Constitution. They should make “Our legislative actions was therefore seek opened up the space for our younger citizens laws for the peace, order and good governance to build public confidence and trust and be to offer themselves to be voted for offices. of Nigeria. responsive to citizens’ questions regarding the “We also amended the constitution so that if “Though expected to cooperate with the ex- conduct of legislative business. there is any vacancy or something happen to ecutive, it must not do so at the expense of its “The House worked for public good and served Mr. President, the Vice President will not only own independence as an arm of government as the institution that defends the rights of step in but retain power and the same thing that participates in the inbuilt constitutional the people to an accountable and transparent too for governors. checks and balances. government. “It is through this Assembly that private mem- “It is not a rubber stamp to executive desires. “The House’s relationship with Civil Society bers bill changed democracy day from May 29 Any national assembly worthy of its name must Organisations (CSOs) was that of partnership to June 12. It is this Assembly that increased the rise up and use its oversight powers under and collaboration to deliver on citizens’ expec- minimum wage to N30, 000 as against the 27, Sections 88 and 89 of the 1999 Constitution, to tations of the legislature,” Itodo said. 000 proposed by the executive. check the excesses of the judicial and executive arms of government,” he said. At the close of legislative agenda, the House “There are many progressive bills passed which was able to pass 382 out of 1643 bills presented are awaiting assent. There is one to remove In the same vein, Executive Director, Founda- in the life of the 8th Assembly; resolved 1413 age discrimination because we have earlier de- tion for Persons Living with Disabilities, Mrs Pat out of the 1588 motions sponsored and consid- clared state of emergency on unemployment John-Oseh, hailed the legislators for passing ered 205 out of the 1192 petitions received. so that our employed youths and graduates the Disability Bill. will receive favourable attention by the public Giving account of its legislative business, service. Dr Abiola Akiyode-Afolabi, the Chairperson, Edward Pwajok, chairman Rules and Business Transition Monitoring Group (TMG), said the Committee of House stated that “in the first “Abolition of first degrees and HND dichotomy, 8th senate passed vital bills that contributed to session, 685 bills were introduced and 68 were granting married women in the public service the country’s development. passed.” options of citizenship, either citizenship of their father or husbands, repel and enactment of “Examples of those bills are the Not-Too-Young- “In the second session, 379 bills were intro- new company and allied company act which To-Run Bill and the Disability Bill, which have duced and 41 were passed. In the third session, has not been amended since 1990 to ease been signed into law. 446 bills were introduced and 94 were passed. doing business in Nigeria. “Those two bills came out very clearly as bills In the fourth session, 143 bills were introduced “Prohibition of estimated billing by electricity that have contributed to Nigeria’s growth and and 63 were passed. The total I repeat, 1643 development. Also, the Minimum Wage Bill bills that we presented and 352 were passed. distribution companies, establishment of the North East Development Commission and also signed into law is another one.” “For motions, 1413 were resolved, 1137 we have passed the South East Development Akiyode-Afolabi, however, rated the senate low 42 POLITICAL ECONOMY JUNE 2019 in terms of other legislative activities, noting able democratic rule. The senate did not do much to that though the senate passed a number of push for passage of the Gender Senate President Bukola Saraki in his farewell bills that were beneficial, it failed in other areas. and Equal Opportunity Bill which has to do with women speech to mark the end of the 8th senate She said the lawmakers did not fully address thanked his colleagues for demonstrating issues bothering on the petroleum sector, the patriotism by protecting the sanctity of the electoral system, among others. legislature. “The senate did not do much to push for pas- He said although some of them had to pay sage of the Gender and Equal Opportunity Bill dearly for daring to defend the Constitution of which has to do with women. the Federal Republic of Nigeria, it was worth it. “In the last election, women suffered a lot of He said he was bowing out a fulfilled man, violence, they suffered a lot of discrimination knowing that in spite of the hiccups experi- and you can see that the seven per cent of enced in the life of the senate, the achieve- women in the national assembly is reducing to ments recorded could not be matched. five per cent in terms of the number of women “Distinguished colleagues, as we come to the representation. “Most importantly, we finalised the Petroleum Industry Governance Bill, though we could not final plenary and the last few days of the 8th “A critical law of that nature is what the national pass the other tranches,” he said. senate, it is a victory in itself that we are seeing assembly should have taken cognisance of,” the journey to its momentous end. she said. Sen. Solomon Adeola (APC-Lagos), said there was no doubt that the 8th senate started on a “That I am here today, that you are here today, The TMG chairperson noted that delay in bud- rancorous note. According to him, the seeming is a victory for democracy. It is a testament to get passage also characterised the 8th national frosty relationship between the leadership what people can do when they come together assembly. of the senate and the executive affected the for the greater good. This is also one of those performance of the senate in some aspects. occasions when the Supreme Creator reminds “Year in, year out, they refused to pass budget us, once again, that power does not reside in at the time when it will be right to address He said: “The instability of the senate lingered any one person. the yearnings and aspirations of the Nigerian for about a year and a half, slowing down leg- people. islative activities within the period. Within the “Let me thank each and every one of you for your contributions toward making this the “So there were lots of politicking that they actu- period, there was also change of leader of the senate, causing another round of distraction. historic senate that it is. When I think of the ally left those things they were supposed to do many trials and tribulations we have faced as as members of the national assembly. “However, we were able to contribute our an institution, and my own personal travails “So in terms of that, I will rate them very low quota as lawmakers because we believe that particularly at the Code of Conduct Tribunal, I because they had all the opportunity to help Nigeria is bigger than anyone. With that in am humbled. mind, we were able to bury our differences to better the lives of Nigerian people, but they did ” “This is because none of our achievements focus on the project Nigeria. not, “she said. would have been possible without the support On their part, some lawmakers, who appraised “Over 200 bills were passed by the senate and and cooperation of the entire members of this their performance within the period, lamented that is commendable, and it shows we were chamber. declined assent to some bills that would have committed to contributing our quota to nation building,” he said. “The invasion of the national assembly by impacted positively on the country. armed security operatives in August 2018 will Sen. Foster Ogola (PDP-Bayelsa), said the 8th Adeola said his expectation for the 9th senate live in infamy. was to see a senate that would be acceptable senate performed creditably in all its ramifica- He noted that the legislations passed in areas tions. to all Nigerians and a leader that would carry everybody along. affecting the daily lives of citizens, the economy, ”This 8th senate has performed beyond expec- education, security, anti-corruption, health and tation. We have passed more bills than all the He noted that for the policies of government many more, would remain a benchmark. to be properly implemented, there was a need previous senates put together. Even in terms of According to him, working together, they public discourse, we have done more because for collaboration between the legislature and executive. “We will be coming to the 9th senate achieved many “firsts” in the 8th assembly the Ethics and Privileges Committee has the saying, “we should rightly be proud of these, highest record of public complaints they have to pursue the agenda of the APC for national development,” he said. especially as they are imperishable legacies we handled,” he said. are leaving for the people. Ogola pointed out that “just recently, the bill I Sen. Matthew Urghoghide (PDP-Edo), said all senators of the 8th senate worked hard to “Our many firsts include the National Assembly sponsored for the Federal College of Education Joint Public Hearing on the Budget, which we Agoro, Bayelsa, went through third reading. ensure what was expected of them statutorily was achieved. According to him, the 8th senate started with the 2016 Appropriation Bill. ”Also, five tertiary institutions bill received third has set a standard that subsequent sessions will “The engagement of the private sector and reading, including mine,’’ he said. work hard to achieve. other stakeholders in crafting the economic The lawmaker commended the senate for Urghoghide noted that “in a bid to ensure that legislative agenda was a watershed. For the passing the redrafted Petroleum Industry Gov- the workload is cleared, we revisited even bills first time, there were meetings and interactions ernance (PIG) Bill, which President Buhari earlier that were declined assent to and passed them with members of the public which were not declined assent to. through third reading a second time. previously the norm. He said in spite of the fact that it was one of “We expect that the 9th senate would do “One such interaction was the Public Senate, the critical bills that were transmitted but not better.” which gave the youth the opportunity to assented to, the senate deemed it necessary spend a day with me as President of the Senate. to pass it through third reading, a second time, He advised the 9th senate leadership to ensure checks and balances for a robust and sustain- “I have pleasant memories of my reading to with the hope that it would be assented to. an audience of small children inside my office, 43 POLITICAL ECONOMY JUNE 2019 where, in the true spirit of Children’s Day, the The most important agenda inauguration of the 9th National Assembly. kids themselves were the dignitaries. should be electoral reform from day one. The Executive must Nigeria operates a bi-cameral legislature, With the curtain drawn on the 8th national not just pursue harmonious comprising the Senate and the House of Repre- relationship now that she has assembly, the senate particularly will be re- majority in government but most sentatives that functions as the nation’s highest membered among many intriguing moments, also send executive bills to the legislative body. for the drama that characterised emergence NASS for passage The National Assembly is empowered to make of its principal officers in 2015, where a deputy laws by the provisions of Chapter I, Section 4 of senate president emerged from a minority the 1999 Constitution. party, without any accord. The Senate consists of 109 elected senators and Agenda for the 9th Assembly the House of Representatives has 360 elected While the 8th Assembly (Reps) could be said members. to have done its best though not necessarily The present legislative work in the House of to the satisfaction of many Nigerians, the 9th Representatives kicked off with the emergence Assembly which takes off is expected to pursue of the Speaker, House of Representatives, Mr agenda that would further entrench democra- Joseph Otteh, executive director, Access to Jus- Yakubu Dogara while Dr Bukola Saraki is the cy and development in Nigeria. tice, affirmed that amendment of the Electoral should be focus of legislative agenda by the 9th President of the Senate. Stakeholders in democratic governance have Assembly to curtail the electoral malpractices. But political analysts note that the 8th National suggested a revisit of the unsigned Electoral Act Assembly has been shrouded in political amendment bill, bills that will boost economic “There are several areas where the National As- intrigues and controversies since its inception, prosperity and strengthen institutions as the sembly can help improve governance, begin- the development they describe as a threat to main legislative agenda. ning from reviewing the process that brought many of them in as lawmakers. That could be a democracy. According to the stakeholders, poor electoral good point of departure. If we do not strength- The threat became a reality when Saraki and system, economic uncertainties and weak insti- en the integrity of our electoral system, we will Dogara decided to defect to the opposition tutions are the bane of Nigeria’s social, political see an escalated level of abuse of the system in Peoples Democratic Party (PDP) in 2018 even as and economic advancement. future elections,” Otteh said. member of the opposition PDP attempted to Mahmood Yakubu, chairman Independent According to him, “Nigeria needs new elec- impeach them. National Electoral Commission (INEC), told toral laws that will provide not just improved Analysts observe further that the leadership members-elect to start work early and con- balloting procedures, but non-discriminatory tussle in the National Assembly has impacted clude work on the electoral framework in good and mandatory enforcement of criminal laws negatively on governance as policies and pro- time, well ahead of the 2023 general elections. governing the conduct of elections and tam- grammes of the government are affected. pering with election results. We should ensure Yakubu urged them to come up with a review that those who” participate in perverting the They cite the instance of the approval of most of the electoral law that would assist the com- electoral system must be kept away from the key appointees of Buhari being delayed by the mission to begin work on post-2019 elections system for a very, very long time as a deterrent.” lawmakers and the foot-dragging debate on review and road map to 2023 as the success budget bills, among others. of Nigeria’s elections depends on the electoral Jude Uzoma, coordinator, Foundation for Sus- legal framework. tainable Development and Inclusive Growth, Acknowledging some shortcomings of the 8th wants the 9th National Assembly to be very National Assembly, Buhari said that he looked “As a process governed by law, the success of committed and look at public outcry with a forward to a mutual and effective working elections in Nigeria depends, to a large extent, view to ending poverty, poor education, lack of relationship with the 9th National Assembly. on the electoral legal framework and most adequate water supply, accommodation and importantly in ensuring adherence to the law. many other issues. According to him, such effective working relationship will improve the budgetary process “The tendency to delay electoral reforms, Uzoma also advocated reworking of the and restore the country to the January-Decem- particularly the review of electoral framework Electoral Act amendment bill, making laws that ber fiscal cycle. until it is too close to the elections, leaves the will strengthen anti-graft agencies and diversify commission with little time to develop pro- the economy. “I look forward to the National The president recounted how the delay in the cesses, including regulations and guidelines, Assembly passing laws, not just passing laws passage of budgets hindered timely execution make required consultations with stakeholders, but making sure the existing laws become of some projects across the country. embark on effective voter education, including functional. Particularly when we talk about sensitisation, train staff and organise deploy- Buhari, nonetheless, expressed confidence the Electoral Act that the President refused to ment for the elections. that more work would be done to improve the assent to in the last National Assembly, you will efficiency of the budgetary process with the Similarly, Idayat Hassan, coordinator, Centre for realise that it is not just because the President victory of the All Progressives Congress (APC) in Democracy and Development (CDD) called on feel entrapped by the Electoral Act,” he said. the general elections. the incoming 9th Assembly to as a matter of “It was probably because certain clauses were urgency work on electoral reforms and avoid He also recalled that the 2018 budget propos- politically inclined and to favour some interests. been rubber stamp in the guise of harmonious als submitted to the National Assembly on Nov. So, in the 9th National Assembly we don’t need executive legislative relationship. 7, 2017 was passed after seven months. all that, in as much as we want the President “The most important agenda should be to assent to the Electoral Act, there must be In spite of this, however, observers note that the electoral reform from day one. The Executive amendments,” he further said. outgoing House of Representatives has been must not just pursue harmonious relationship able to initiate and pass milestone bills within Inaugurated on June 9, 2015, the 8th National now that she has majority in government but the legislative years. Assembly ends on June 9 and it will function most also send executive bills to the NASS for until June 9 when President Muhammadu They note that out of 1, 516 bills so far treated passage,” she suggested. Buhari’s issues a proclamation letter for the at the House of Representatives between June 2015 and January 2019, members of the House 44 POLITICAL ECONOMY POLITICAL ECONOMY JUNE 2019 Laundering (Prevention and Prohibition) Act of Representatives sponsored not less than Some bills died at the first 1,380 bills. reading, some at the second (Amendment) Bill, 2016, National Environmen- reading, while others at the third tal Standards and Regulations Enforcement One of the outstanding bills passed by the reading. Besides, there were bills Agency Statutory Appropriation Bill, 2016, lower chamber is a Bill for an Act to Alter the which got the lawmakers’ nod but which the executive declines among others. Provision of the Constitution of the Federal assenting and one of such bill Republic of Nigeria, 1999 and for Other Matters Petroleum Industry Bill Also, bills emanating from the Senate to the Connected Therewith sponsored by Rep. House include Nigerian Railway Authority Act Tony Nwulu, otherwise known as the Not-Too- (Repeal and Re-enactment) Bill, 2016, Public Young-To-Run Bill. Procurement Act (Amendment) Bill, 2016, De- fence Space Administration Bill, 2016, Federal The bill, which drew local and international University of Agriculture, Kabba (Establishment) attention, was signed into law by Buhari on Bill 2017 and Federal Collages of Education Act May 31, 2018 at the Council Chambers of (Amendment) Bill, to mention but few. the Presidential Villa in the presence of some young Nigerians, the Not-Too-Young-To-Run Although the 8th House of Representatives’ bill Movement. progression chart shows that the lawmakers National Minimum Wage Act (Amendment) had performed well in their legislative calendar, The law reduces the age qualification for pres- Bill, 2015, National Broadcasting Commission not all the bills, whether private member bills, ident from 40 years to 35 years, governor from Act (Amendment) Bill, 2015 and North East public bills or executive bills, sailed through the 35 years to 30 years, senator from 35 years to 30 Development Commission Bill, 2015. legislative drills. years; House of Representatives membership from 30 years to 25 years and State House of Fiscal Responsibility (Amendment) Bill, 2015, Some bills died at the first reading, some at Assembly membership from 30 years to 25 Electoral Act (Amendment) Bill, 2015, Appro- the second reading, while others at the third years. priation Act (Amendment) Bill, 2015, National reading. Besides, there were bills which got the Council of Traditional Rulers Bill, 2015, Utilities lawmakers’ nod but which the executive de- Another outstanding bill passed entitled: Charges Commission Act (Amendment) Bill, clines assenting and one of such bill Petroleum “Discrimination Against Persons With Disabili- 2015 and National Identity Management Industry Bill. ties (Prohibition) Bill 2018’’ is meant to cater for Commission Act (Amendment) Bill, 2015 are Rep. Abdulrazak Namdas, the Spokesperson the more than 25 million persons living with also passed. disabilities in the country. of the House of Representatives said that Similarly, the House of Representatives legislat- members, within the years under review, The bill was sponsored by Rep. Ochiglegor ed on National Inland Waterways Authority Bill, had been able to sponsor several bills for the Idagbo and was signed into law by Buhari on 2015, Pension Reform Act (Amendment) Bill, socio-economic and political development of Jan. 23, few days to 2019 general elections. 2016, Nigerian Postal Service Act (Amendment) the country. Bill, 2016, National Agency for Albinism and Hy- The Act, which guarantees right to maintain According to him, law making is the principal po-Pigmentation Act (Establishment) Bill, 2016 civil action for damage by the person injured job and duty of a legislator and each lawmaker against any defaulter, prohibits all forms of and Electoral” Act (Amendment) Bill, 2018. should have key areas of interest he or she discrimination on grounds of disability and im- It is also worthy of note that within the 2015 wants to specialise on. Namdas said that a poses fine of N1, 000, 000 for corporate bodies and 2019 legislative calendar, some members legislator must have the capacity and the and N100, 000 for individuals or a term of six have had many bills to their credit. knowledge and do research on particular areas months imprisonment for violation. he needed to sponsor any bill or a motion. For example, Rep. Uzoma Nkem-Abonta spon- It also provides for a five-year transitional period sored not less than 62 bills in the House; Rep. Ossai “You must be conversant with the laws as some within which public buildings, structures or Ossai sponsored no fewer than 50 bills while Rep. of the laws could be in different forms; the bill automobile are to be modified to be accessi- Edward Pwajok had no fewer than 31 bills. could either be amended or you want to repeal ble to and usable by persons with disabilities, the law or you want a fresh law, depending on including those on wheelchairs. These are few among many members who which area of interest. contributed to the legislative proceedings of the The Act, which stipulates that all public organ- lower chamber within the year under review. “But if you don’t have the knowledge, you isations are to reserve at least five per cent of may not be in the position to even amend or employment opportunities for these persons, Besides carrying out its legislative function on sponsor the amendment. also establishes in Section 31 the National executive bills brought before it, the House of Commission for Persons with Disabilities with Representatives also concurred on bills ema- “The president does not assent to some of the Executive Secretary as the head. nating from the Senate. bills that is why you will see some bills in the fifth assembly recurring,’’ he explained. The Whistle Blowers Protection Bill is another For instance, one major bill from the executive to important bill the lower house deliberated on. the lower house was the National Minimum Wage He admitted that there might be some instanc- The bill, which was co-sponsored by Rep. Femi Bill, 2019. Because of its importance to the nation’s es when the executive might not be on the Gbajabiamila and Rep. Kayode Oladele, seeks workers, the bill was given accelerated hearing. same page with the legislature for some rea- to facilitate and encourage the disclosure of im- sons. “When the executive has a feeling that a The National Minimum Wage Bill, 2019, which bill is trying to subvert it or trying to undermine proper conduct by persons, public officers and was deliberated upon and passed by the law- corporate bodies whether private and public. the executive power, even as good as it may be, makers less than a week, was transmitted to the it will not be signed into law. It is also to ensure adequate protection of Senate for concurrence. whistle blowers from reprisals, victimisation, “These are some of the challenges, there are Some of the bills sponsored by the executive bills that the legislature has been able to put in isolation and humiliation which are said to be include: News Agency of Nigeria Statutory some of the consequences of whistle-blowing. place but they have not been assented to,” he Appropriation Bill, 2016, Federal Capital Territo- said. Other bills passed include the Petroleum Indus- ry Statutory Appropriation Bill, 2016 spon- try Governance Bill, 2016, Terrorism Bill, 2015 sored by the executive, Mutual Assistance in Namdas also cited the Electoral Act (Amend- Gender and Equal Opportunities Bill, 2015, Criminal Matters Act (Amendment) Bill, Money ment) Bill which the president declined his 45 POLITICAL ECONOMY JUNE 2019 assent to, assuring Nigerians that the re-elected Bill, which according to him, were aimed at We expect that when the new members would take the bill up from where it CAMA, which we just passed, providing significant reforms to the business stopped. becomes law, it will yield even environment and strengthening Nigeria lend- more significant results in ing legislative frameworks. “For some of us, who have been re-elected, we helping small and medium scale will still have to go back and work to ensure entrepreneurs to access capital, He further said, “We are particularly glad that the grow and multiply that the bill is fully assented to in the 9th Na- impact of the Secured Transactions in Movable tional Assembly. Assets Act and the Credit Bureau Reporting Act became apparent immediately after they were “The 9th National Assembly will ensure that signed into law as they formed the basis for its leadership is on the same page with the which the World Bank upgraded the rating of Ni- executive since majority seats in both houses geria in its Annual Ease of Doing Business rating. were from the APC. “We expect that when the new CAMA, which “In the 8th National Assembly, we had a lot of we just passed, becomes law, it will yield even hiccups; the experiences are not good enough more significant results in helping small and and we don’t expect that in the 9th National medium scale entrepreneurs to access capital, Assembly,” he said. Saraki, a two-time former governor of Kwara State, who is also the Chairman of the current grow and multiply”. All in all, the Executive Director, Youth Initia- National Assembly, alongside the Speaker of the He recalled also that the eighth Senate passed tive for Advocacy Growth and Advancement House of Representatives, Hon. Yakubu Dogara, bills like the Nigerian Financial Intelligence Unit (YIAGA AFRICA) and convener of the Not- has been able to give quality leadership to the Bill (FIUB); the Mutual Assistance in Criminal Too-Young-To-Run Movement, Mr Samson two chambers of the National Assembly. Matters Bill; the Witness Protection Bill; the Itodo, commends the lawmakers for the feats Whistleblower Protection Bill and the Federal achieved in passing the famous bill. Although the duo faced some challenges especially from some of their colleagues, who Audit Service Commission Bill to support the Similarly, the Executive Director, Foundation were opposed to their emergence, they were fight against corruption. for Persons Living with Disabilities, Mrs Pat however able to quickly put that behind them Saraki further named the Constitution amend- John-Oseh commends the legislators for a to face the legislative duties ahead of them. ment bills, the ‘Not Too Young to Run’ bill, the good work done on the Disabilities Act. The Assembly had succeeded in passing sev- Financial Autonomy for Local Government Bill, The 9th National Assembly, which was inaugu- eral bills in the last three and a half years with Financial Autonomy for Houses of Assembly, rated on June 9, has majority members-elect President Buhari refusing to assent to some of among other bills aimed at improving gover- from the APC. them. A case in point is the 2018 Electoral Act nance and ensuring that government serves the people better. In the Independent National Electoral Com- (Amendment) Bill, which was transmitted by mission’s list, APC has 211 members-elect in the National Assembly to the President but The Chairman of the House Committee on Me- the House of Representatives; the PDP has 111, refused assent in a record four times. dia and Public Affairs, Hon. Abdulrazaq Namdas, while 20 seats have yet to be declared due to ” said what the House achieved in the past three The Eighth National Assembly however record- the elections that were declared inconclusive in ed huge successes, particularly in actualising and a half years surpassed previous assemblies. the affected constituencies. their mandate as a legislature in a country, According to him, the House successfully Other political parties that will be represented where the people expect much from every passed 222 bills and referred 284 to relevant in the lower chamber include: All Progressives level of governance. committees. He added that over 1,473 bills Grand Alliance (APGA) with six members; Action As a mark of carrying out legislative duties for were altogether introduced on the House floor Democratic Congress (ADC), three members, over three years at the National Assembly, Sen- with 90 bills for constitution amendment while Action Alliance (AA); two members and People’s ate President Saraki had recently emphasised 519 others were awaiting second reading. Redemption Party (PRP); two members. that federal lawmakers deserved some kudos, Namdas disclosed that 112 bills were awaiting The African Democratic Party (ADP), Allied Peo- having performed well, noting that the Eighth consideration, adding that 22 bills died natural- ple’s Movement (APM) and Social Democratic Senate worked “assiduously and diligently to ly while 23 others were withdrawn by the leave Party (SDP) won a seat each and out of the over meet the demands of Nigerians.” of the House. 300 seats declared so far, only 10 are women. According to him, “In this time, we have passed Since the inception of the National Assem- Although many members in the 8th National 213 Bills, cleared 138 petitions submitted bly, no assembly has achieved this success,” Assembly will not return to the chamber having by the public. We are happy to say that this Namdas said, particularly elated that the House lost their re-election bids, Nigerians hope for Senate is the most productive since 1999. It has was able to work with the executive to lead improved relations between the Executive and surpassed the fifth Senate with 129 bills in four the country out of recession. Also notable was the House for the development of the country. years, as against the sixth Senate with 72 bills, the passage of the North-east Development and 128 passed by the seventh Senate. Commission (NEDC), for which the Speaker of Saraki, Dogara and Deputy Senate President, the House, Hon. Yakubu Dogara, took credit. Ike Ekweremadu during a joint sitting of the “The number of petitions we have successfully National Assembly said despite its many chal- treated to the satisfaction of Nigerians, who There appears however to be a lot before the lenges, the eighth National Assembly remains filed them dwarfed those treated by the sixth lawmakers. There are still 546 bills pending be- one of the most effective federal legislatures in and seventh Senate respectively.” fore the National Assembly as it gradually winds the nation’s political history. He was particularly excited that through legisla- down. Though at the last count, the Eighth tive activities, the present Senate has contribut- Senate has so passed about 219 bills, including Despite the drama and intrigues associated Senate bills, concurrence bills and constitution with the emergence of Dr. Bukola Saraki, as ed to growing the economy by passing Bills like the Companies and Allied Matters Act Bill; the amendment bills, pending bills at committee the President of the eighth Senate on June 9, stage are 167; those awaiting first reading and 2015, the legislature had struggled to carry out Secured Transactions in Movable Assets Bill; the Credit Bureau Reporting Bill and the Ware- second reading at both chambers of the federal its core constitutional function of churning out legislature are 95 and 236 respectively, while good laws for the betterment of the nation. house Receipts Bill; Nigerian Railways Authority Bill and National Transportation Commission pending bills for concurrence are 48. 46 POLITICAL ECONOMY FINANCEAGRICBIZ JUNE 2019

JUNEL 2019

NIGERIAN AGRO SECTOR: GAPS, CONSTRAINTS AND PROSPECTS While agriculture remains the key ria could feed itself. But the situation changed Development Project for Nigeria’. by the mid-1960s, as Nigeria began to move to the country’s development, In 2011, the administration of former experts are of the opinion that from self-sufficiency in basic foodstuffs to import dependency. President, Goodluck Jonathan, launched the despite the opportunities, there ‘Agricultural Transformation Agenda’ (ATA) to are some constraints that limit the According to the World Bank, with abundant promote agribusiness, private sector invest- growth of the sector. SHILE GIWA water supply, and a favourable climate, Ni- ment, job creation, productivity, value add, writes on the challenges affecting geria can rise again in the agriculture sector, market access, and financing for farmers. the growth in Nigeria. provided it utilises its small-scale farmers, promotes farming as an employment oppor- The ATA was seen by many as a step in the tunity, partners with the private sector, and right direction for the agriculture sector. It helped revamp the overtly corrupt fertilis- rior to the discovery of crude oil, provide significant investments in infrastructure and technology. er- and seed-distribution business through agriculture was the main stream of the the ‘Growth Enhancement Support’ (GES) Nigeria economy. It accounted for 50 Over the years, many administrations in Program. It also focused on private sector in- per cent of gross domestic product Nigeria had initiated several strategies to vestments and provided marketing reforms P(GDP), and more than 75 per cent of export boost the agriculture sector. These included and innovative financing. earnings. Cash crops such as cocoa, ground- the ‘National Accelerated Food Production nut, sesame, palm oil and rubber were at the Program’, ‘Operation Feed the Nation’, the However, In June 2016, the current admin- central stage of foreign exchange earnings. ‘River Basin Development Authority’, ‘Green istration, through the Federal Ministry of Agriculture and Rural Development, released But most importantly, during that time, Nige- Revolution’ and the ‘Commercial Agricultural 47 FINANCEAGRICBIZ JUNE 2019 its policy and strategy document for its constraints identified, the true potential of Vice national president, All Farmers Associ- ‘Agriculture Promotion Policy for 2016-2020’. agriculture will be realised.” ation of Nigeria (AFAN), Chief Daniel Okafor, The policy hopes to build on the success of who said food must be consumed on a daily the ATA and close key gaps, specifically the While reiterating the need to prioritise live- basis, added that storage and processing reduction in food imports and improve- stock production, he said increase in animal were critical in ensuring that the commod- ments in foreign exchange earnings from products in the country whose population ities produced at a particular period were agriculture. is expected to reach 440 million people by available for consumption whenever and the year 2050, would help alleviate poverty, wherever they were required. This aligns with the current administration’s provide food security and meet other needs reiteration that the Nigerian economy needs of such a growing population. He said efforts of stakeholders in the sector to diversify away from an over-dependence have not been sustained to ensure good on the oil and gas sector. The policy also falls “As Nigeria struggles to advance in animal road networks in the rural areas where the within the objectives of the African Develop- production many factors militate against bulk of agricultural activities take place. ment Bank (AfDB), Feed Africa Strategy, seek- animal production in the country, like inad- ing to improve productivity; develop input equate finance, high cost of animal feeds, Also speaking, a farmer from Nasarawa State, and output market structures and incentives animal diseases, lack of infrastructure, lack Ganiyu Mukhtar, who said food perishes due to capitalise on increased production, and of government incentives, transportation to lack of storage and processing facilities, promote private sector engagement and and other factors militating against animal noted that simple, efficient, and cost effective investment. production in Nigeria and tries to proffer technologies for perishables, such as roots, solutions to them,” he added. tubers, fruits and vegetables, are not highly Access to inputs such as improved seeds, developed in the country compared to the fertilisers, chemicals, and planting materials Managing director, Santuscom Agro Hub, an storage technologies for cereal grains and by farmers have been identified as one of indigenous food packaging/processing firm, legumes. the major challenges to smallholder farmers Chief Ofana Paul, who spoke on the benefit in Nigeria. Also poor access to information, of processing and packaging as way forward Consequently, he said post-harvest food adequate financing and post-harvest losses to sustain food security, said, the lack of storage losses were very high, adding that are other critical barriers in the sector. adequate storage and processing facilities ac- approximately 40 per cent of such produce counts for the divergence between national usually perish, compared to cereal grains and Experts recognise that the agriculture sector food security and household food security. pulses at about 15 per cent. According to holds tremendous opportunities for wealth him, “Traditional storage facilities have certain creation in Nigeria, saying in the face of Paul while describing packaging as an deficiencies, including a low elevated base the global oil glut, there is a dire need for essential medium for preserving food quality, giving easy access to rodents, wooden floors investment in this sector in order to boost the minimising food wastage and reducing that termites could attack, weak supporting economy. preservatives used in food, said it serves the structures that are not moisture-proof, and important function of containing the food, inadequate loading and unloading facilities.” They are also of the opinion that animal protecting against chemical and physical production is a very important sector of damage while providing information essen- Mukhtar, who further spoke on the recent the economy of any nation, adding that it is tial to consumers and marketers. hand over of concessioned silos, said the crucial in ensuring food security. arrangement would not work to generate The managing director stated that his firm the expected income because farmers were Commenting on the prospects, the man- has been into the processing and packaging not carried along in the process from the aging director, El-trexone Farms, Dr Ibrahim of agriculture products and has enjoyed the beginning. Dikko, reiterated the need for the govern- benefit that comes with this, adding that, ment to collaborate with private sector to with the encouragement of it, more jobs will He said farmers, particularly those who were train farmers in business schools so as to be created for women and youths. far away from where silos were located across gain an insight into new opportunities in the states, would find it difficult to transport the agribusiness value chain as well as tackle “We have enough to feed ourselves with their grains to the location because of huge challenges that have made agribusiness here in Nigeria and that is why I often say that transport cost. unprofitable in the past. we should now begin to think of exporting food to other parts of Africa. The demand for He therefore called for construction of small- He said: “A partnership with the private sector the production and processing of plantain er silos across the states for easy access by the has proven to be beneficial for agribusiness is quite huge. The demand for plantain flour farmers. in increasing productivity and strengthening in Cameroon and Ghana is so huge and that input and output market structures. For the is why we need to improve on our modes private sector to continue to be motivated to of packaging and processing of agricultural invest, the country would do well to speed products in order to meet the demands of up its attempts at solving identified challeng- the market.” es. He however noted that adequate packaging “Nigeria, projected to have a population of helps in advertising the product and improv- 440 million people by 2050, needs to take ing the overall product value thus leading to food sustainability seriously. Fortunately, higher sales and profit for the investor. the country has what it takes to meet the increased demands for food and consumption “It provides customer satisfaction with strong patterns. Its agricultural policies, if properly customer – oriented approach. They note implemented, are capable of making Nigeria that, of course, most producers of food want food-secure and prosperous. By harness- their customers to get home with or receive ing the opportunities and addressing the their products at home, undamaged and in great condition,” he added. 48 FINANCE FINANCEAGRICBIZ JUNE 2019 NIGERIA’S ECONOMY SEES STRONG AGRIC GROWTH Agriculture has benefited from macroeconomic and structural reforms initiated by President Mu- hammadu Buhari’s administration aimed at economic stability, inflation reduction and trade expansion. Analysts say the reforms could pave the way for competitive agricultural operations, if the government takes steps to reduce production costs and enhance the agro business environment, Abisola THOMPSON reports.

For watchers, within the last four years, agri- Iyama said the government had shown He also told the Oil Palm Value Chain Stake- cultural production has confronted difficul- some commitment to revamping the sector. holders that, “on the finance supply side, ties due to the negative impacts of climate This followed the launch of Green Alternative the Bankers’ Committee had established a change, high cost of production and natural policy and other programmes, presenting special sub-committee to make recommen- calamities. agriculture as a top priority. According to dations on sustainable financing models for Iyama, the government has increasingly oil palm and four other critical agricultural Also, Nigeria faced some challenges in the prioritised agriculture and food security as a commodities that include cocoa, sesame international market on agricultural produce, national-level driver of economic growth. seed, shea-butter and cashew. including commodities rejection, especially the European Union (EU) ban on Nigerian Central Bank of Nigeria (CBN) and agricul- His engagements with state governors on staples.The EU banned Nigeria’s dried beans ture how to increase oil palm production are also in June 2015 because it contained a high lev- yielding fruits. Emefiele said: “I am happy to el of pesticide dangerous to human health. Iyama said the Central Bank of Nigeria (CBN) announce that all the states in the South- had impacted on the agriculture sector in the south and South-east regions have agreed In June 2016, the ban was extended by three five-year leadership of Godwin Emefiele. to provide at least 100,000 hectares for the oil years because of the presence of dichlor- Through its activities, he said the CBN palm initiative. This programme also accom- vos (pesticide) in dried beans from Nigeria, modates the small holder oil palm farmers.” and maximum residue levels of pesticides creatively implemented programmes to showed that compliance with food law re- diversify the productive base of the econo- For the country to attain self-sufficiency, quirement as regards pesticide residual could my, through agriculture, thereby conserving Iyama believes that must be committed not be achieved in the short term. foreign exchange. development of more estate plantations and Aside conserving foreign exchange, he coordinated partnerships between the small Despite this, with efforts by people from all holder plantation farmers and processors. walks of life and the political will demon- noted that the introduction of the policy that strated by the government, the nation is excluded 43 items from accessing foreign NIRSAL achieving positive results. exchange from the Nigerian forex markets was largely aimed at improving domestic In his view, the Director-General, Feed In the four years under review, a series of im- agriculture production. Nigeria Summit, Richard-Mark Mbaram, said portant policies were introduced to promote the hope of improved agricultural yields in key branches in the agriculture sector. In addition, CBN’s engagements with oil Nigeria and indeed Africa has brightened as palm value chain stakeholders have also the Nigerian Incentive-Based Risk Sharing For example, the Federal Government been yielding fruits. It has helped to fast-track System for Agricultural Lending (NIRSAL) launched the agricultural sector roadmap, investments across the oil palm value chain. has stimulated investment in technology to known as The Green Alternative, for promo- Oil palm is on the forex excluded list. boost yields and generate gainful employ- tion of agriculture from 2016-2020. It adopt- ment. ed policies to develop the fishery sector, as According to analysts, official figures indicate well as restructuring production of rice and that importation of oil palm had by about 40 According to him, NIRSAL Plc, a vision of the other crops. per cent from 506,000 metric tonnes (MTs) in CBN is exploring ways of bringing tech- 2014 to 302,000 in 2017. nologies to millions of Nigerian farmers to More importantly, the government has Last year, the CBN governor met with Oil enable them farm efficiently, effectively and encouraged more enterprises to invest in sustainably. rural agriculture while helping farmers and Palm Value Chain Stakeholders, where fishermen find consumers for their products. he rolled out further measures and set a One partnership, he noted was NIRSAL ‘s partnership model that would stimulate Memorandum of Understanding (MoU) with While Nigeria has not achieved much in oth- investments in palm oil plantations, such that Heritage Bank Plc, which he said would en- er areas, experts believe the nation has made within the next five years, the global share of sure secured financing of agribusiness within progress in agriculture. One of those who Nigeria’s oil palm production would increase. all segments of the agricultural value chain. share this thought is the National President, “Our ultimate vision is to overtake Thailand Federation of Agricultural Commodities of and Columbia to become the third largest He said the partnership was important be- Nigeria (FACAN), Dr Victor Iyama. producer in the next 10 years,” Emefiele said cause it would help farmers to benefit from at the meeting. 49 FINANCEAGRICBIZ JUNE 2019 loans and credit available, at very low interest rates, to pursue commercially viable agricultural projects that have been packaged and fully de-risked. Anchor Borrower Programme (ABP) Analysts believe the CBN’s Anchor Borrower Programme (ABP) will ensure Nigeria emerges from being a net importer to becoming a major producer of rice. As at October last year, according to analysts, thousands of farmers cultivating about 835,239 hectares, across 16 different commodities, have so far benefited from the Anchor Borrowers programme, which ment, state governors, millers of agricultural The Group Managing Director, Niji has generated 2,502,675 jobs across the produce, and smallholder farmers to boost Group,Kola Adeniji, said challenges country. agricultural production. such as poor agricultural practices, low technological adoption, and poor access By March 15, this year, the CBN committed Tomato to extension services, low quality inputs, a total of N171.35 billion in the Anchor CBN’s intervention in production of tomatoes and lack of credit has continued to Borrowers’ Programme with active partic- stands at a little over N10 billion in eight hinder the sector from realising its full ipation across the 36 states of the Federa- projects. One of the projects is the Dangote potential. tion and Federal Capital Territory (FCT), to Green House tomato manufacturing project, improve local rice production. Annual rice Challenges notwithstanding, he said which has the capacity to produce 10 million Nigeria’s agriculture has enormous production in Nigeria has increased to 5.8 tomato seedlings monthly. This would be million tonnes. potential to transform the economy if sold to about 5,000 out growers that would the government works with the private The State Chairman, Kebbi/Sokoto Rice grow and supply the tomato factory, which sector to and make farming much more Farmers Association of Nigeria, Muhammed has commenced operations, with tomato productive and profitable for smallhold- Augie, said the programme has helped fruits. The project has the capacity of gener- er farmers. increase local production of the commodity. ating one million jobs from supporting small holder farmers in tomato cultivation to paste. Going forward, he said Nigeria needs He said the programme since inception had This project has the capacity to save the Ni- to improve its policy environment, to created economic linkage between small gerian economy over $250 million annually. enable investments that will allow the holder farmers and reputable large-scale farm sector to continue to adapt to the processors, thereby increasing agricultural Farmers’ challenges opportunities created by rising demand outputs and significantly improving capacity One of the challenges inhibiting agricultural and the challenges of climate change utilisation of processors. growth is poor infrastructure. Country Direc- and limited resources. He advised the government to ensure tor of HarvestPlus, Dr Paul Ilona said farmers According to him, basic rural infra- farmers get inputs under the pro- face other challenges, particularly from weak structure needs to improve as well as gramme before the start of the farming links along the agri-business logistics chain. investment to keep pace with economic season. He pleaded that the government Ilona said Nigerian farmers are traditionally growth. ensures rice farmers get loans at five smallholders, farming less than two hectares Medical marijuana percent interest like rice millers. of land. According to him, many of them are Iyama said CBN’s support towards rice located in extremely remote areas. According to him, Nigeria needs to boost its place in global agro-food markets, in production has contributed significantly He said one of the largest structural chal- to the success of the agricultural sector. exporting cocoa, cashews and medical lenges facing smallholder farmers is the marijuana. He said Nigeria would derive Given the success achieved under this lack of infrastructure,such as roads, rail- economic benefits from tapping into the programme, the CBN has promised to ways, irrigation, and power that would marijuana market. continue to support it until the full po- enable their access to larger markets, tential of the sector is achieved. improve the quality of their produce, With an estimated value of $145 bil- and facilitate moving up the value chain lion in 2025, he said Nigeria would be The ABP was launched by President Mu- into agro-processing activities. short-changing itself if it fails to tap into hammadu Buhari on November 17, 2015 the legal marijuana market. in Kebbi, aimed at creating a linkage With some transporters unwilling to risk between anchor companies involved in damage to their vehicles from substan- He explained that marijuana can earn the processing and SHFs of the required dard roads, Ilona said growers experi- for the government more money than key agricultural commodities. ence difficulties in bringing their crops oil. According to him, a litre of oil is one to market, weakening the supply-chain dollar while a litre of marijuana oil is $15. The fund was provided from the N220 links to processors, and subsequently billion micro, small and medium enter- leading to produce losses. Instead of destroying it, he said the prises development fund. Federal Government should control pro- Other stakeholders lamented unreli- cessing of medical marijuana cultivation ABP evolved from the consultations able power supply in the country, which in controlled plantations under the full with stakeholders comprising federal poses significant challenges. supervision of the (National Drug Law ministry of agriculture and rural develop- Enforcement Agency (NDLEA). 50 FINANCE

JUNE 2019 CEO

OB3, AKK PIPELINES: ECONOMIC TRANSFORMATIONAL PROJECTS – OILSERV BOSS Engr Emeka Okwuosa is the Group Chief Executive Officer of Oilserv Group. In this interview with TBI Africa team at the 2019 Offshore Technology Conference in Houston, Texas, United States, he stressed the importance of Nigeria’s two massive gas pipeline projects - the OB3 and AKK. He also spoke on the other industry issues and the need to drive technology growth in Nigeria. He maintained that oil and gas will continue to occupy key place in the global energy mix in the foreseeable future and will continue to contribute significantly to Nigeria’s economy. 51 FINANCE AGRICBIZ JUNE 2019 Obiafu-Obrikom -Oben (OB3) When we talk about OB3, it is not completion of your own LOT, will just about building a pipeline. the pipeline be operational with- pipeline is a game changer and you Our own section, don’t forget are playing a key role in its delivery. there are two lots there. We are out the other party working on building LOT B that will take the LOT A completing its own section? How soon are we getting to the gas from mid-point all the way to final stage and how will Nigerians Oben plant plus the Oben plant itself. To some extent, no, but it depends feel the impact of such strategic on how the owner of the pipeline project that will change the way wants to use it. One thing you have gas is delivered in the country? to know about the technicality is et’s put OB3 in proper perspec- that we have a pipeline going to GTP tive, no pipeline has been built Oben, but we have a 36inch line we in Nigeria of that size or capaci- built from Oben GTP to Escravos-La- ty. You may recollect where we gos Pipeline System (ELPS), which is Lare coming from in the 1970s, 80s, Oben North, that is a bidirectional and 90s, when we had the likes of plant took a longer time because the pipeline. This means you can take Willbros Group and McDermott In- location was changed from Oben gas from the GTP in Oben into ELPS ternational, among others and there North to the GTP location and it took or take from ELPS into GTP, so the were no Nigerian players. But even us two years to go through re-engi- answer is yes and no. Yes, in the sense at that, if you look at all our pipeline neering it and getting the approvals. that from the 36inch pipeline which infrastructure today, nowhere has But the story is clear, the pipeline and we have completed, you can take 48inch pipeline been built but that the GTP are going through pre-com- gas from ELPS into Oben to Ajaoku- is what we building. Let us also put missioning now on our own section. ta when we commission it. But the in perspective, it is not just about The management of the Nigerian Na- other section cannot be completed the pipeline we building, we also tional Petroleum Corporation (NNPC) except Lot A finishes and be able to have the Gas Treatment Plant (GTP) visited the facility last evacuate gas all the way from Obi- at Oben, which is part of our month. By Sep- afu-Obrikom into Oben. scope. This is a GTP that will tember, our own What would you consider to be handle two billion standard LOT would some of the inhibiting factors to cubic feet per day (2bscf/d) have been participation of indigenous com- of gas. This has never done, and panies in the deepwater terrain? existed anywhere in Africa. I can Do you see indigenous companies ”only When we talk about OB3, it operating in the deepwater in the is not just about building a speak nearest future? pipeline. Our own section, for don’t forget there are two Oilserv. We are already operating in that terrain in reality. When you say oper- lots there. We are building With the LOT B that will take the gas ating in the deepwater, you look at from mid-point all the way to it from two different points of views. Oben plant plus the Oben plant Are you looking at Exploration and itself. For our pipeline, we Production (E&P) ownership, which finished it three years is operatorship or are you looking at ago, but the services. I will talk from services treatment point of view. From the services point of view, Nigerians have been participating all the way from Bonga, Akpo and Usan, which are deepwater assets. All these have had Ni- gerians’ input. There are two key issues with participation in deepwater arena. It is about technology and capital. Both will take time normally to scale up. Nigerians are participating but 52 FINANCE FI- CEO NANCE JUNE 2019 we are only scathing the surface. had to go abroad for people to There is still more opportunity for come and do it. We have deployed participation. Now, how do we that. We have been able to cross increase that? Like the Managing rivers with 48inch pipeline, which Director of Shell Nigeria Explo- would mean drilling and opening ration and Production Company the line to 64inches, which is a major (SNEPCo), Bayo Ojulari said, we challenge because it collapses a lot. require to basically assemble ca- We are encouraging technology a pacity and integrate that capacity lot as a company. In the University by working together in order to of Nigeria, Nsukka, in the past eight have synergy and be able to deal years, we have been sponsoring with bigger scope. But we are in nanotechnology and it has got a the integration of FPSO (Floating lot of possible applications across Production, Storage and Offload- board. But in the oil industry, you ing) vessel, which is the issue can talk of the drilling solutions and of topsides. Nigerians materials. But the fact remains that are in pipelines, flow in such technology, we are still on re- lines and risers and search stage from where it develops drilling. We are quite into deployment stage. Deployment in a lot but it is very requires teaming up between the competitive and research entity and the industry. It is capital intensive and a process and that is still at the pre- we have to slowly liminary stage. Also in UNN, we have build it up as soon sponsored the science park, which as we can because they call – the Lion Science Park, we have proven ca- the first of its kind in Nigeria. UNN is pacity but we need the first to set up a science park and to do more because it was done in collaboration with there is so much out Ideon Science Park in Sweden. It is a there. big thing going on in Nsukka. What are we doing there? Incubation of How do the in- technology from the students at digenous players various levels and we help them to collaborate to be develop it, and we link them to in- competitive and If you go to houses that have dustries that can invest and take it to add value to the sector? flats, if it is 20 flats and you have 20 tenants, instead of one tenant work. If you have a project like this, providing energy and everyone We have been adding value but connects to it and shares the bill, you may not achieve 100 per cent not to the extent that we want it. you will see everybody with his of your initiative but if you achieve own generator So the way we can achieve this is 20 per cent, you are making a major by collaborating and synergizing headway and it will end up like the between entities and all PETAN Silicon Valley. It is things like this that members and be able to handle big- Oilserv encourages to be able to drive ger scope and compete with interna- technology in Nigeria. tional service providers. There have been talks about roles Why is there no such collaboration of robots in deepwater operation, at the moment? do you think that is possible in Nigeria? It is the Nigerian factor. Everyone we will get there. wants to do things in his own way Oilserv is good in nanotechnol- Anything is possible but what we and it is not the way to go. For in- ogy and the future of oil and gas should be asking ourselves is how stance, if you go to houses that have is technology. Robotics currently do we put that side by side with the flats, if it is 20 flats and you have 20 does a lot of works in the industry. Nigerian initiative and benefits? If you tenants, instead of one tenant provid- What is your plan in incorporating take robotics totally the way you see ing energy and everyone connects technology in your operations? it, you displace human capital and to it and shares the bill, you will see if you displace human capital, what everybody with his own generator. It We are already incorporating tech- happens to our economy? I won’t say is a Nigerian factor. It is about under- nology in our operations. Many years it is not in our own interest to deploy standing that the way to create value ago, you could not find any Nigerian that and I won’t say you can stop that requires working together and not as company that can do horizontal because you can’t stop a moving individuals. It is a mindset thing but directional drilling. You would have train. You would have to realize that ” 53 CEO JUNE 2019 overtime, it may take 10 years to 20 The Ajaokuta-Kaduna-Kano (AKK) overseas doesn’t know what you are years or more, and that may become project is a very unique project, not talking about in naira. So you have to just what it would achieve, which is to the norm but what you do you? You be able to move gas to northern part provide an instrument of convertibil- start to train people to develop such of Nigeria and create availability of ity that has to come from the Central energy to drive industries and create job technology, you start to train people opportunities. Bank of Nigeria (CBN), and guaran- because somebody has to manage teed that every collection in naira will that. You will create a different skill-set be immediately converted to dollars. to be able to drive that but you can- That is the typical instrument. These not completely take out the human things take time to get through the interface. government agencies. So, we are going through that process and we At what stage is the AKK project? are almost there. We have almost The Ajaokuta-Kaduna-Kano (AKK) finalized the security and we have project is a very unique project, not also started with the early works -en- is not the kind of money you raise just what it would achieve, which is to gineering. As we speak, the AKK has in Nigeria. You have to go and raise be able to move gas to northern part started, that is the point I’m making. of Nigeria and create availability of that capital outside the country and Does the spate of kidnapping and energy to drive industries and create for you to raise it, you need security. insecurity in the north affecting the job opportunities. If the North does That security instrument is a process, project? not have energy, unemployment con- and part of it requires the Federal Government comes in. For instance, tinues, security problem continues, We are Nigerians, if there is kidnap- if you are backing up the financing everybody will suffer. Secondly, AKK is ping, we will deal with it. We are not with the tariff you will significant because it is the first time going to stop developing Nigeria raise from that such project of that magnitude is because there is kidnapping. In con- pipeline, don’t being done as engineering, pro- struction, we are tested and we are forget that curement, construction (EPC) knowledgeable. We worked 100 per most of and Finance. It is not like the cent between 2002 and 2007 when that previous projects where the kidnapping was the norm in the tariff for Nigerian National Petroleum Niger Delta region. Oilserv remained example Corporation or the Interna- there. We worked in the swamps, will be in tional Oil Companies (IOCs) ” maintained all the pipelines, so there naira. A award you a project and pay are ways to do that. We are Nigeri- finan- for it and you go ahead and ans, we work in Nigeria and we must cier execute and collect your create capacity in Nigeria. That is not who is money. In this project, we going to be an impediment at all. It is (the contractors) are providing a concern but we have procedures to the money and to provide such deal with that. amount of money is not easy. The What is the state of the oil and gas total value of that project for industry today and what it holds for the two LOTs is about service providers? $2.8billion. This Oil and gas industry is very active industry all over the world and particularly for Nigeria and theme of this year’s OTC panel discussion which hinged on deepwater services and opportunities, tells it all. Nigerian oil and gas industry has come a long way. Clearly, the oil and gas industry will continue to be relevant and drive the economy of Nigeria but not quite as much as we expected it in terms of integration into the Nigerian economy as far as GDP 54 CEO FINANCE CEO JUNE 2019 In crossing roads, in the past, we have the environment and you may muddle contribution is concerned. There are to cut the road and imagine cutting the water. If you don’t restate it very well, many structured manners that can an eight lane road. Today, we do cross- boring system by going from one end to you create additional problem down the be put in place to be able to achieve the other without disturbing vehicular road which can be erosion of the water that. Some of these were discussed movement on the road bed. We developed a system where at the panel session. What is import- we can drill from one bank to the other ant is that available opportunities in without touching the bed of the river. services whether it is in deep offshore, land or swamp, less than 20 per cent In crossing roads, in the past, we have of that opportunity is being tapped to cut the road and imagine cutting an today in terms of value, so I can say eight lane road. Today, we do cross-bor- the opportunities in the oil and gas ing system by going from one end to industry are still huge. the other without disturbing vehicular movement on the road. These gave Can you tell us something about bound by certain rules of the welder us advantage over others. We train Oilserv that will encourage upcom- association. With this, we are able to students and graduates and we invest in ing service firms or those intending do as much as 25 joints a day. Manual human resources. to come into the subsector? welding can’t do more than six joints We won the AKK project because it was Oilserv was set up on a sound ba- a day. That’s how we sped up. through a bidding process and we came sis and principle. That’s the basis of The other technology is our Horizon- out best. We are the only company sound knowledge of engineering tal Directional Drilling (HDD) technol- in Nigeria today that can deliver such and clear plan to grow technology ogy system. You may realize that in project, the rest can’t. We are the first and grow the company organically. building pipelines, you cross rivers, indigenous firm to graduate from being When we started in 1995, it was a very creeks, and all kinds of barriers. If it is a construction firm to full EPC Company. small company. It was only I and one water, you will dredge it, drop the pipe- To be a full EPC company is expensive. It other employee and we slowly build line, and cover it up. But by doing that, requires investment, it requires dedica- it up. Now, we built it up by reinvest- you disturb the water system, tion. If you look at AKK, you realize we ing whatever money we make and damage got the first section which is the most acquiring latest technology. It’s not important. If you don’t get the first sec- just about technology acquisition but tion right, you don’t have a pipeline. by knowing the principles of these technologies. For my background, I’m ” The OB3 is currently undergoing a cerebral engineer and I worked in pre-commissioning. A project of that 12 different countries before I came size, the largest pipeline existing back to Nigeria. I was principally in Nigeria for gas, which is 48inch focused on developing engineer- diameter and 67 kilometres is ing capacity. Along the line, we not a small project. For you to do moved on to look at the best way pre-commissioning, you have to of achieving the engineering, clean up the pipe, pressurise it. procurement and construc- Just imagine 48”by 67km tion (EPC) work we have. We pipeline and the volume later introduced the welding of water you have to fill it. works. Welding is at the core It has to be sectionalized, of pipeline construction and fill the water, pressurise and the major threat in welding is the clean it up to meet all the fact that using traditional welding standard before you can now system which is the manual welding remove the water, dry it up. system, will involve welders associa- To dry alone, because you tion. Some of them are not there to can’t mix water with gas which work but to create problems and you you intend to transport, can’t control the quality of output too. you will use a compressor We moved on to develop automatic with high pressure and semi-automatic welding system and temperature and where it is more like being in pump. Just imagine a production line in a fac- the volume of air you tory. We trained our own have to pump into staff and they became the 48” diameter by 67km welders and because it is pipeline. Sometimes, not manual welding but it can take up to three automatic, so we are not months to dry. 55 Lifestyle& JUNE 2019 RELATIONSHIP HOW TO MAKE YOUR SEXUAL LIFE MORE ROMANTIC sexual pleasure through a variety of methods, not just intercourse. Here are three ways you and your partner can make sex more romantic in your relationship. Master the Art of intimate sex talk he fact that you and your partner can’t have intimate conversations about sex is not good for your sex life. Having sex talks with your lover helps to deepen yourT intimacy and emotion connection while also learning your likes and dislikes when it comes to sex. Redefine “Sex” We all have a unique attitude towards sex usually shaped by our individual life experiences. Sex should be about passion rather than achieving a goal like reaching orgasm or mastering a technique. Goal-orientated sex can create sexual dysfunction when the goal isn’t reached as you are more likely to feel like there’s something wrong with you. When you make your sex about passion, then the pressure and shame of not performing to an expectation is gone as you no longer have to feel self-conscious. In other words, simply enjoy the experience as this will make things more pleasurable for both you and your partner. Ironically, not being stressed about having an orgasm makes it easier to have one. Have a mental erotic Love map Building a mental erotic love map guides you on your partner’s sexual likes and dislikes to Broaching the important topic of sex can help you create a great sex life. Don’t be shy sometimes be uncomfortable for many In an online study of 70,000 people in 24 to ask specific questions about what they en- couples but let’s admit it, many of us are countries, researchers found couples who joy and don’t, what they want to try out and embarrassed about being sexually reject- have a great sex life make sex a priority what make them feel uncomfortable. Sample ed or about our bodies. rather than the last item of a long to-do questions can be, what felt good about sex list. They create space for intimacy and last time? What did we do that caused you Not only that, but society has also encour- connection. These couples talk about sex to feel closer and connected to me? What aged feelings of sexual shame, making ro- and put the relationship first, despite the did we do that made you relax? What did we mantic and intimate sex a scary endeav- demands of work and kids. They discover do that turned you on? What do you need our to even talk about. 56 FI- LIFESTYLE AND RELATIONSHIP JUNE 2019 to make sex better for you? What makes sex more like lovemaking for you? What are fantasies or thoughts you have during sex? What to consider before making a public proposal We have seen a couple of viral videos of public proposals gone wrong on the Nigerian side of social media; sadly, that has and will not be the last of such episodes to happen. Many people around the world have also experienced this sting of public embarrass- ment at one point or another. Not only are public proposal fails funny but, it is also sad at the same time. It takes guts and a strong conviction to declare your love for someone publicly. address and resolve. Tell me about you. This is can be rephrased, However, to avoid turning yourself into a whichever way that still makes you com- laughing stock, there are some things you The first step to achieving a good resolve fortable to keep up with the conversation. need to be very sure of before proposing to is by understanding that a good conversa- Either way, it is a great one because it your partner in public. tion starter can make a boring or normal invites the other person to tell you some- conversation great. In this article, you’ll see thing that they want to share and helps the Talk about marriage ahead of time the best conversation starters that will help conversation evolve. turn that ‘stranger’ to your new buddy. Just because your relationship seems like it is destined to be, doesn’t guarantee it will lead to a perfect marriage. To be frank, there are WAYS TO BUILD YOUR SELF-CONFIDENCE no guarantees when it comes to marriage. or somebody with social anxiety, intru- after you go, and stay hydrated throughout the It is best to have candid conversations sive thoughts can have a really negative day). Or else you will go and hate it while you about marriage with your partner in order impact on their confidence and self-es- are there as well as after. And bring music.” teem. In a Reddit thread that has gone to know whether or not he or she is willing It’s not just that working out makes you look Fviral and garnered more than 30,000 replies, to settle down at the same time as you. better, which makes you feel better: the regular people have started sharing their best advice These conversations also let you in on how disciplined routine and endorphin rush can on how to build self-confidence. Here are the this person’s idea of marriage. actively help people who struggle with depres- most popular things they recommend doing: Make sure you are both ‘on the same sion and anxiety. “Running to a point of endor- page’ Try working out phin release or deadlifting really heavy helps me,” said a commenter with depression. “After Exercise was cited by many as a factor in This should be a no-brainer but judging by a good work out I don’t even have repetitive, improving the way they felt about themselves. the kind of negative drama that sometimes intrusive thoughts.” However, they added: “The “Going to the gym helped me tremendously comes with public proposals, you need to hard part is getting going to work out.” be double sure that your partner loves you with my self-confidence and depression,” wrote as much as you love him or her. If you’re in a one commenter. Weightlifting in particular Spend some quality time solo has helped me take control of my body and one-sided relationship, getting down on a Other advice in the thread included getting self-image.” Another commenter said: “I ended knee and proposing marriage won’t fix it. You more comfortable with being by yourself. “Go up getting a personal trainer as well and it was are merely signing up to get rejected. to the movies alone,” suggested one com- the best thing I ever did. My social anxiety was ment. “Another time go out to eat alone at a Make sure your partner loves surprises too bad to try navigating the gym solo. restaurant that you are interested in. Do things A person who hates to be surprised would Having a guide and someone to be ac- like this regularly. It helps you be comfortable feel ambushed with an unexpected marriage countable to really keep the motivation in with making decisions and taking charge and it proposal in public. This is the more reason to check, at least for me.” helps you be comfortable in your own skin re- know someone well before trying to pull off gardless of who is around and who is looking... Going to the gym might not seem like a great this kind of stunt, or else, the outcome may It forces you to be comfortable in public alone idea for a self-conscious person at first; the not be what you were hoping for. where you don’t have friends to take the focus image of all those muscular people training can of others around you.” It is better to be sure than sorry. be an intimidating one. “I stuck my nose up at Simple conversation starters that help the gym for a long time. Thought it was only Do something that scares you for jocks and vain people. And although many ‘Break the Ice.’ One thing killing your chance Don’t worry, you don’t have to take up sky-div- jocks go to the gym, as well as vain people, of starting something really beautiful with ing. Venturing outside your comfort zone can lots of average people too,” one commenter someone you have been crushing on for start with baby steps, like talking to somebody at said. But they soon learned the psychological while does not know how to start or hold a a bar. “When you take steps outside your comfort benefits of training: “Huge mood booster, forces conversation. zone, you teach yourself you can handle a lot yourself into uncomfortable situations, and more than you thought,” said one commenter. Many do not know what to say after the in the end you look better... BUT you have to “It makes it easier to face your fear and do things generic salutation – Hi, How are you? And prepare yourself for it, you need to ensure you you want to do, which gives you confidence.” that is a big issue that a lot of people need to have the energy levels (eat properly before and 57 JUNE 2019 ADVERT RATES HARD COPY

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