14 Sep

Daily Watch – Ranchers to get insurance, NNPC to shut three refineries

  • Nigeria is very unlikely to join OPEC’s cuts in oil production before March. OPEC and other producers, including Russia, are reducing crude output by about 1.8 million barrels per day until next March in an attempt to support prices by cutting a glut of crude oil on world markets. Nigeria and Libya, whose output has been affected by political turmoil and attacks, are exempt from the agreement. “It is very unlikely that I see stability that convinces me with certainty that I should exit the exemption between now and March,” oil minister, Ibe Kachikwu, said.  He also said an extension of the cartel’s cuts was possible since volumes of oil stocks were still a challenge. Nigerian oil production, excluding condensates, is running at 1.6 million barrels per day, Kachikwu said, although he said that “for next year, all things being equal, I expect that we will be able to meet 1.8 million bpd of crude.”
  • The FG has said it would provide insurance cover and agro-rangers for ranch operators to curb cases of cattle rustling as well as clashes between farmers and herdsmen. Vice President Yemi Osinbajo said this in Abuja at a national conference on the transformation of the livestock industry. Osinbajo represented at the event by the agriculture minister, Audu Ogbeh explained that 3,000 agro-rangers had been adequately trained to protect animals and livestock from rustlers. The vice president added that the country had about 19 million cows, a lower figure than its neighbours.
  • The NNPC will shut down three of its four refineries, Group Managing Director, Maikanti Baru has said. Baru who said this on the sidelines of the inaugural Nigerian Pipeline Security Conference and Exhibition disclosed that the purpose of the closure of the refineries located in Port-Harcourt, Warri, and Kaduna was to rehabilitate and restore them to nameplate capacities. According to him, the rehabilitation work would restore the refineries to nameplate capacities by 2019 when the country is expected to exit the importation of petroleum products. NNPC spokesman, Ndu Ughamadu, said that Baru has inaugurated eight committees to oversee the revamping of the refineries.
  • 74 percent of manufacturing companies have rated the country’s business environment this year as “unsupportive” due to unfavourable exchange rate, bad roads, energy scarcity, limited access to credit and policy inconsistency, a new survey shows. The 2017 Manufacturing Sector Survey conducted by NOIPolls and the Centre for the Study of the Economies of Africa (CSEA) also identified lack of infrastructure, unstable power supply and weak demand as the top challenges facing Nigerian manufacturing. In 2016, 60 percent of manufacturing firms rated the business environment as unsupportive. Presenting the report on Tuesday, NOIPolls CEO, Bell Ihua said the lack of infrastructure, red-tapism and corruption were also identified as some of the structural bottlenecks stifling the business environment. Some of the report’s insights include the fact that 85 percent of companies surveyed are not operating at up to 75 percent of their installed capacity. 48 percent of the companies interviewed considered the importation of raw materials critical to their production; particularly medium to large manufacturing companies, with up to 62 percent of inputs imported. Also, 75 percent of companies say the disparity in foreign exchange rates has had a negative impact on their operations. Similarly, 80 percent of the companies affirmed that inflation has had a negative effect on their businesses.
  • Nigeria plans to sell ₦917.14 billion worth of treasury bills between 14 September and 30 November, a CBN debt calendar for the fourth quarter showed on Wednesday. The bank aims to auction ₦209.85 billion in 91-day bills, ₦197.89 billion in 182-day and ₦509.39 billion in 364-day debt. Africa’s biggest economy has a series of debt issues lined up this year, including a ₦100 billion debut domestic sukuk it is marketing to fund infrastructure projects.