12 Jun

Daily Watch – Nigeria and Morocco get comfy, New bill pegs minimum requirement for pioneer tax at ₦100m

  • Nigeria’s oil exports may drop in July to around 1.43 million barrels per day. According to Reuters, loading plans for the month of July have dropped to its lowest so far this year. The export plan consists of 48 cargoes compared to 60 cargoes and a daily level of 1.79 million barrels per day in June. This drop in volume has been attributed to the shutdown of the Bonny Light stream which has been declared a force majeure by Shell for a month. Prior to the declaration of force majeure on Bonny Light exports, the country’s crude shipments were already witnessing delays following a leak on the 200,000 to 240,000 bpd Trans-Forcados pipeline that shut down thus effectively cutting deliveries of Forcados, the country’s largest crude grade.
  • The ‎FG will take advantage of the Meter Asset Provider Regulations to deploy a fund of ₦37 billion towards supplying meters through private sector. Speaking in Kaduna, the minister of power, works and housing, Babatunde Fashola, said the FG is determined to address concerns of poor liquidity in the sector and would work with the private sectors to close metering gap. According to Fashola,”Meter Supply has become the big issue of the moment that consumers wants us to resolve. ‎As a government, we hear them loudly and clearly.” The Meter Asset Provider regulations gives private investors opportunity of investing in meter assets, working closely with the Distribution companies of Nigeria, and closing the metering gap of 3.36 million electricity consumers without metering devices.
  • Nigeria and Morocco have signed three agreements on a gas pipeline, a basic chemicals platform, and agricultural cooperation. The signing of the agreements, witnessed by President Buhari and King Mohammed VI, focused on strengthening economic relations in gas resource development, agricultural training & management and global investments, as compiled from the office of Nigerian presidency. The joint declaration by the two countries laid out the next steps for the completion of a gas pipeline deal that will be built onshore and offshore. This is following an earlier agreement to the pipeline by the two countries in December 2016 and launched feasibility studies ending with a plan to build the pipeline onshore and offshore. “The regional gas pipeline when executed will see Nigeria providing gas to countries in West Africa sub-region that extend to Morocco and Europe,” Nigeria’s presidency said in a tweet.
  • A new bill, the Industrial Development (Income Tax Relief) Act (Amendment) Bill, is in the process of legalising a ₦100 million minimum capital as the requirement for local companies to enjoy pioneer status, which comes several incentives. If passed, the bill will cut off SMEs from enjoying the perks that come with being recognised as a pioneer in the eligible sectors of the economy. BusinessDay reports that this review also seeks to amend Section 6 of the Principal Act by increasing the capital expenditure for other companies applying for Pioneer Status Certificate from ₦150,000 to ₦120 million. The bill, which is sponsored by Sabo Mohammed (APC, Jigawa State), has passed First Reading in the Senate.