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World’s largest refinery to cost $10bn; Dangote secures $650m loan

Africa’s richest man, Aliko Dangote, has signed a $650 million loan facility with the African Export-Import Bank for his oil refinery project in Nigeria, estimated to cost about $10 billion

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Africa’s richest man, Aliko Dangote, has signed a $650 million loan facility with the African Export-Import Bank for his oil refinery project in Nigeria, estimated to cost about $10 billion.

The seven-year term loan would attract a moratorium of five years, according to facility terms read out during the signing.

Dangote Group Executive Director Devakumar Edwin said that the oil refinery would be completed by December 2019.

He added that the company would borrow $3.3 billion for the project, arranged by Standard Chartered Bank. The remainder will be funded by equity and through export agencies.

Read Also: Ghana raises clean energy capacity by 40%, as gas flows at Sankofa

Dangote is building the world’s largest single oil refinery and aiming to address long-standing problems in Nigeria’s energy markets.

The refinery and petrochemical complex is located on 25,000 hectares of swampy land with a jetty to ferry products by sea within Nigeria and abroad including an undersea pipeline to transport gas.

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Nigeria’s apex bank, CBN, introduces new cash withdrawal policy but legislators aren’t impressed. Here’s why

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The lower chambers of Nigeria’s legislative house, the House of Representatives have asked the Central Bank of Nigeria (CBN) to suspend the implementation of the new cash withdrawal policy.

The new policy put limits cash withdrawal limits for individuals and corporate organizations.

Nigeria’s apex bank on Tuesday in a new circular placed limits on over-the-counter cash withdrawals, Automated Teller Machine (ATM) withdrawals, and point of sale (PoS) withdrawals.

The CBN directed all banks and other financial institutions to ensure that over-the-counter cash withdrawals by individuals and corporate entities do not exceed N100,000 and N500, 000, respectively, per week.

In response to the new policy, the legislatures summoned the CBN Governor, Godwin Emefiele, to appear before the new policy takes effect on January 9, 2023.

The upper chamber of the Nigerian legislature, the senate had also expressed concerns about the policy, with the Senate President, Ahmed Lawan, cautioning the apex bank not to jump into the policy at once as many Nigerians will be affected.

Honourable Mogaji argued that small businesses are drivers of Nigeria’s economy and most small business owners transact their businesses, trade, and transactions in physical cash and are in most cases, not inclined to the use of electronic banking system as most of them are either illiterate, half-educated or not learned at all.

He said, “These set of Nigerians who are the drivers of Nigeria’s economy will be seriously negatively affected and their business and source of livelihood may be seriously impaired with these new directives of CBN.

“The new policies rolled out by CBN will hurt the already dwindling economy, and further weakens the value of Nigeria as Nigerians may resolve to use dollars and other currencies as a means of trading and thus further de valued Naira and weakens the economy.”

Nigeria has been on a recent trend of monetary policy in a bid to rescue its struggling economy. Nigeria’s apex bank recently announced plans to introduce new designs of the N200, N500, and N1,000 notes this month.

Meanwhile, the inflation rate in Nigeria has continued to rise and hit a new 17-year high of 21.09% in October 2022, marking a 0.32% points increase from 20.77% recorded in September. Will the latest reign of monetary policies help manage the growing inflation rate? The jury is out on that.

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South Africa’s coal exporter, Thungela Resources, expects doubled profit for 2022

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One of South Africa’s main coal exporter, Thungela Resources (TGAJ.J) on Thursday revealed that it expects its full-year profit to double.

The projection comes as demand and higher prices for the fossil fuel offset the negative impact of poor rail performance on its export shipments.

The company said its headline earnings per share (HEPS) – the most common profit measure in South Africa – is expected to be at least 131 rand ($7.65) in the year to December 2022, 97% higher than last year’s 66.57 rand.

The benchmark coal prices averaged $276.57 per tonne for the year to date, compared to $124.11 per tonne last year,

Although its export performance suffered as a result of problems at state-owned rail and port operator, coal prices had been driven by demand, especially from Europe, whose energy supplies have been disrupted following major fuel exporter Russia’s invasion of Ukraine.

“Poor rail performance impacted our ability to move coal to port, with a concomitant impact on export sales,” Thungela said.

“The poor performance was further exacerbated by a 12-day strike by Transnet employees in October 2022, as well as a severe derailment on the coal corridor in early November which took 10 days to clear.”

South Africa Coal Production was reported at 234.495 Tonne mn in Dec 2021. The records shows a decrease from the previous number of 245.818 Tonne mn for December 2020.

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