VenturesNow

Increase in Crude Prices: Nigeria’s Dangote claims IOCs sabotaging refinery

Published

5 months ago

June 25, 2024

Vice President of Oil and Gas at Dangote Industries Limited, Devakumar Edwin, has accused International Oil Companies in Nigeria of plans to frustrate the survival of the new Dangote Oil Refinery and Petrochemicals.

Edwin said the IOCs were “deliberately and willfully frustrating” the refinery’s efforts to buy local crude by hiking the cost above the market price, thereby forcing the refinery to import crude from countries as far as the United States, with its attendant high costs.

Speaking to reporters on Friday during a one-day training session hosted by the Dangote Group, Edwin further charged that the Nigerian Midstream and Downstream Petroleum Regulatory Authority had given marketers licenses to import unclean refined products into the nation without any discrimination.

Edwin claims that although the Federal Government of Nigeria granted 25 licenses for the construction of refineries, only the Dangote Group fulfilled its commitment.

The vice president mentioned that the refinery had shipped more than 3.5 billion litres of aviation fuel and diesel to Europe in the previous few months, even as he urged the government to provide support. It was stated that around 90% of the fuel produced was exported.

“The Federal Government issued 25 licences to build refineries and we are the only one that delivered on our promise. In effect, we deserve every support from the government. It is good to note that from the start of production, more than 3.5 billion litres, which represents 90 per cent of our production, have been exported. We are calling on the Federal Government and regulators to give us the necessary support to create jobs and prosperity for the nation,” Edwin stated.

He continued by saying that despite the Nigerian Upstream Petroleum Regulatory Commission’s best efforts, crude oil for the refinery with a capacity of 650,000 would not be allocated, “the IOCs are deliberately and willfully frustrating our efforts to buy the local crude.”

According to the Dangote official, the IOCs have occasionally pushed the refinery to pay $6 more than the market price. As a result, the company has been compelled to lower its output and incur higher costs for the import of crude from nations like the United States.

He said, “Recall that the NUPRC recently met with crude oil producers as well as refineries’ owners in Nigeria, in a bid to ensure full adherence to Domestic Crude Oil Supply Obligations as enunciated under section 109(2) of the Petroleum Industry Act. It seems that the IOCs’ objective is to ensure that our petroleum refinery fails. It is either they are deliberately asking for a ridiculous/humongous premium or they simply state that crude is not available. At some point, we paid $6 over and above the market price. This has forced us to reduce our output as well as import crude from countries as far as the US, increasing our cost of production.

“It appears that the objective of the IOCs is to ensure that Nigeria remains a country which exports crude oil and imports refined petroleum products. They (IOCs) are keen on exporting the raw materials to their home countries, creating employment and wealth for their countries, adding to their Gross Domestic Product, and dumping the expensive refined products into Nigeria – thus making us to be dependent on imported products. It is the same strategy the multinationals have been adopting in every commodity, making Nigeria and Sub-Saharan Africa to be facing unemployment and poverty, while they create wealth for themselves at our expense.”

“This is exploitation – pure and simple. Unfortunately, the country is also playing into their hands by continuing to issue import licences at the expense of our economy and at the cost of the health of the Nigerians who are exposed to carcinogenic products.”

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VenturesNow

Ghanaian cocoa farmers stockpile beans ahead of price rise

Published

16 hours ago

November 6, 2024

Ifeoluwa Dada

According to industry sources cited by Reuters, cocoa farmers in Ghana, the world’s second-largest producer, are stockpiling beans in anticipation of higher prices.

This could put pressure on supplies to a global cocoa market that is trying to rebound from the devastating harvests of the previous season.

A dozen farmers, purchasers, and representatives from the state regulator Cocobod confirmed the practice, though it was unclear how widespread the up-country bean stocking was. Some blamed the practice for the slowdown in bean purchases.

“I have more than 300 bags, but I won’t sell,” said a cocoa farmer in south-central Ghana, who asked not to be named. “I will only sell after Christmas. We want to see if they will increase the price as they said.”

All of the reports claimed that farmers were responding to remarks made by Vice President Mahamudu Bawumia, who four weeks prior had promised to increase farmer prices to members of the ruling New Patriotic Party.

Speaking at Sefwi Wiaso, one of the largest cocoa-growing communities in southwest Ghana, Bawumia is vying for the presidency in the elections scheduled for December 7. Since then, he has claimed that his remarks were misinterpreted.

According to Cocobod officials, Ghana lost over one-third of its 2023–2024 cocoa production to smuggling, compounding the problems that caused production to drop to a level not seen in over two decades and contributed to record-high cocoa prices worldwide.

After a volatile session on Monday, US stocks ended the day marginally lower as investors braced for a pivotal week that would see the Federal Reserve make its policy announcement and Americans elect a new president.

Ghana increased the fixed farmgate price by over 45% to 48,000 cedis, or little less than $3,000, per metric tonne for the 2024–25 season, which began in September, in an effort to increase farmer incomes and discourage smuggling.

But Ivory Coast, Ghana’s neighbour and the largest cocoa producer in the world, increased the price to 1,800 CFA francs ($3.00) per kilogramme, which is only marginally more than Ghana’s.

VenturesNow

Zambian govt spends K16.6 billion in October on debt servicing, gulping K4.7 billion

Published

2 days ago

November 5, 2024

Ifeoluwa Dada

Zambian Ministry of Finance and National Planning released K16.6 billion in October to assist Zambian development and public service delivery, according to the ministry’s budget release issued by the Treasury.

The government allotted K4.5 billion to pay public service personnel salaries and allowances. Health and teaching staff and Zambian ambassadors abroad received allowances.

The government set aside K4.7 billion for debt service and arrears to reduce national debt. K2.2 billion went to domestic debt service, K256.9 million to overseas debt, and K2.1 billion to legacy fuel arrears.

The ministry’s budget, which stated, “Notable expenditures included K3.5 billion for transfers, subsidies and social benefits, K4.2 billion for various development programs, general operations and capital expenditure, and K700 million for drugs and medical supplies.”

Situmbeko Musokotwane, Minister of Finance and National Planning, took advantage of the statement to urge foreign investors to think about Zambia as a potential place to invest.

Musokotwane emphasised Zambia’s favourable investment climate while speaking at a recent World Bank meeting in Washington. He also urged collaborations in the fields of manufacturing, mining exploration, renewable energy, and agriculture.

“Zambia is endowed with critical natural resources, and we invite you to collaborate with local business players in mobilizing the resources required for green energy projects, mining explorations and development, and agriculture value chain ventures that support out-grower schemes through farm blocks,” Musokotwane stated.

He called for investors to collaborate with Zambian companies, highlighting the advantages of doing so in important economic sectors like mining, agriculture, and energy.