13 Sep

Daily Watch – Food inflation to ease over October harvests, Three states go dark after fire

  • Vice President Yemi Osinbajo announced on Monday that the Federal Executive Council had agreed to the concession Nigeria’s two biggest airports, Murtala Mohammed in Lagos and Nnamdi Azikiwe Airport in Abuja. Osinbajo also asked the private sector to report Ministries, Departments and Agencies of government stalling the implementation of the ease of doing business, saying naming and shaming was the only way to improve the country’s business environment. The vice president said these at the 5th Presidential Quarterly Business Forum in Abuja on Monday. He said, “First, we want to do a general overhaul. Second, we want to enter into the concession of the airports. I am pleased to say that the Federal Executive Council has approved the concession of the Lagos and Abuja airports,” he stated.
  • The FG, Agip and Shell have completed the technical and commercial evaluation of bids for the main packages in the development of the $13.5 billion Zabazaba deepwater oil field in Oil Prospecting Lease (OPL) 245 within 14 months, Thisday reports. Shell and Agip acquired OPL 245, which was christened the Zabazaba field, from Malabu Oil and Gas in 2012 for $1.3 billion. The acquisition has been the subject of a corruption probe and prosecutions in Italy and Nigeria but has not deterred Shell and Agip, which have both maintained their innocence, from going ahead with the field’s development. Agip is developing the Zabazaba field with proven reserves of 560 million barrels of oil as a standalone development in the eastern portion of the Niger Delta in water depths ranging from 1,200 to 2,400 metres.
  • With staple harvests due in October as a result of improved rains in the North-East, a new report by Renaissance Capital forecasts improved food prices that will ease headline inflation from the last quarter of 2017. Although there are concerns about the impact of the floods in Benue, the research firm said with the rainy season taking its toll within and outside the northeast, staple harvests that begin as late as October in northern areas are expected to be greater than last year, according to the Famine Early Warning Systems Network. “This is attributed to increased access to inputs as well as strong production incentives for farmers due to very high staple prices. Near-term harvests imply we could see food inflation begin to soften from 4Q 17, which is positive for headline inflation. However, when one strips out prices of farm produce – which monetary policy has no control over – core inflation is slowing nicely. Core inflation fell below the policy rate of 14.0 percent in May. This opens the prospect of a rate cut, in our view”, the report added.
  • The NNPC plans to award 80 percent of crude lifting contracts to one of its subsidiaries, NNPC Trading. At the moment, 39 local and foreign firms are engaged in the crude lifting deals. The Managing Director of NNPC Trading, Ibrahim Waya, in an interview with the corporation’s quarterly magazine, the trading company is currently saddled with 40 percent of the nation’s oil lifting contracts. Waya said the target of the firm ultimately was to handle all the lifting contracts. He said, “The GMD [Maikanti Baru] told us that what he wants to achieve for trading is that by the end of 2018, he wants the NNPC Trading to have 80 percent in terms of Nigeria’s crude oil, and also conversely by the end of 2018, we want to do every form of import of products, if need be, to augment the local production of products through the NNPC Trading.” The Federal Government had in January this year awarded 12 months’ crude lifting contracts for about 1.31 million barrels per day to 39 companies.
  • Plateau, Bauchi and Gombe states were thrown into darkness following a fire outbreak which engulfed the Jos Transmission Station. Although details of the fire incident were sketchy, The Punch reports that the fire started at the Kilometre 7 transmission station, Zaria Road in Jos at about 4:47 pm on Tuesday evening. In a terse statement issued on Tuesday night by Jos Electricity Distribution (JEDCO) spokesman, Friday Adakole Elijah apologised for the inconvenience suffered by customers in the affected areas and added that a team of JEDCO engineers were working on restoring power within the shortest possible time.