NNPC Opens Bid For Crude Oil Sale And Purchase

Maikanti-BaruThe Group Managing Director of Nigeria National Petroleum Corporation, Dr Maikanti Baru, says only refiners, big traders and companies with substantial investment in the oil and gas sector, will scale through the bid for the 2016 to 2017 term contracts for Nigeria crude oil sale.

A total of 224 companies are bidding for the 12 month term contracts tender, for a number of slots the Group Managing Director says will be decided on actual production focus by February 2017.

Representatives from the 224 companies converged on the amphitheater of the NNPC for the opening of the bid.

Dr Baru, who opened the bid after a test of transparency, said that the volume of crude put out for the contract bid is nearly 700,000 barrels of crude per day.

He added that the actual number of companies to emerge from the bidding would be decided in the first quarter of 2017.

The NNPC GMD also stated that Nigeria’s crude is not struggling for market, contrary to speculation but continues to earn premium, with major markets in Europe and Asia, with the United States recently added to the list.

Reps Ask Executive To Audit Revenue Sources

DogaraThe House of Representatives has urged the Executive to undertake a comprehensive audit of all government’s sources of revenue.

According to the lawmakers, an audit would assist the Federal Government in exploring other sources of revenue.

Nigeria largely depends on crude oil sales as its major source of revenue, a situation the the current administration said it was making efforts to shift away from.

The request for the audit was part of issues discussed at plenary on Wednesday.

The House said it would also enable the National Assembly track the revenue sources for the purpose of making appropriate budgetary decisions.

It also urged the Executive to ensure that the report of the audit was submitted to the National Assembly within the next ninety days.

The lawmakers’ demand is coming on the same day it said it would pass the 2016 budget on March 17.

House Of Reps Says Review Of Oil Benchmark Is ‘Certain’

House-of-RepresentativesThe House of Representatives in Nigeria says the National Assembly will certainly review the crude oil benchmark price for the 2016 budget.

The possibility of the review was made known to Channels Television on Wednesday by the Chairman of the House of Representatives Committee on Appropriation, Abdulmumin Jibrin.

Nigeria’s 2016 budget had been submitted to the National Assembly in December by the President, with a benchmark of $38 less than the current crude oil price.

This price per barrel has triggered comments about how realistic the budget proposal of 6.07 trillion Naira, with 2.22 trillion Naira deficit and a crude oil benchmark of $38 was.

But on Monday, the Minister of Budget and National Planning in Nigeria, Senator Udo Udoma, tried to allay Nigerians fears, assuring them that the falling crude oil price would not affect the nation’s 2016 budget submitted with the oil benchmark of $38 per barrel.

Senator Udoma spoke at a meeting with members of the National Assembly Committee on Budget and Planning.

He told the lawmakers that there was a plan to cushion all shortfalls that may arise as a result of the drop in oil prices.

According to him, part of the plans would include concession of airports and re-introduction of toll gates on the nation’s highways.

Budget Breakdown

GDP Growth Rate Projection4.37%
Revenue Projection3.86 Naira
Deficit2.22 trillion Naira (equivalent to 2.16% of Nigeria’s GDP)
Oil Related Revenues820 billion Naira
Non-oil Revenues1.45 trillion Naira
 Projected Independent Revenues1.51 trillion Naira
Capital Expenditure1.8 trillion Naira (30%  of total budget)
Works, Power and Housing433.4 billion Naira
Transport202.0 billion Naira
Interior53.1 billion Naira
Special Intervention Programs300 billion Naira
Education369.6 billion Naira
Defence294.5 billion Naira
Health221.7 billion Naira
Ministry of Interior145.3 billion Naira
Foreign and Domestic Debt Service1.36 trillion Naira
Sinking Fund towards the retirement of maturing loans113 billion Naira
Non-debt Recurrent Expenditure2.65 trillion Naira

 

To address Nigerians concerns, however, the National Assembly is considering the review of the benchmark.

Mr Jibrin said that the new benchmark that would be arrived at would be a practical figure.

The Chairman is also encouraging the executive to fully implement the Integrated Personnel Payroll System as a means of reducing the recurrent part of the country’s budget.

Nigeria relies largely on crude oil sales for its revenue, a situation that the Senate President had also warned against.

Senator Bukola Saraki said on Tuesday that focus must be shifted away from crude oil dependency to non-oil sectors for the government to be able to raise funds that would cater for the budget.