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NUPRC moves to boost investments in Nigeria with automation of business processes

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The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has revealed that it will be automating business processes in the oil and gas industry to boost investments inflow into the sector.

This follows the huge outflow of investments particularly in the Nigerian oil and gas industry in 2023.

Reeling out out its action plan for 2024 and near term 2024 to 2026, the NUPRC highlighted in broad terms the regulatory approach and actions that are to be implemented by the Commission in furtherance of its mandate as the apex regulatory agency established to supervise upstream petroleum operations in Nigeria.

The Regulatory Action Plan (RAP) is focused on regulatory and predictability, future licencing rounds policy and implementation, unit cost of production optimisation, automation and business process improvements for operational efficiency, promoting ease of entry and investment retention, vacating entry barriers associated with huge asset acquisition fees, deepening transparency, accountability and elimination of discriminatory regulatory practices, implementation of a carbon credit earnings framework for upstream operations, accelerating the execution of oil and gas development and production projects, and enforcement of Drill or Drop provisions of the Petroleum Industry Act (2021).

Other areas of focus include the optimisation of federation revenues, decarbonisation and greenhouse gas (GHG) emissions management in producing environment and Incorporation of green story in FDPs, diligent monitoring of implementation of the Nigerian Gas Flare Commercialisation Programme (NGFCP) awarded sites for optimum flare-out monetisation, Host Community Trust Fund implementation and guiding the trust fund activities to reduce agitation in the operations areas and 100 percent hydrocarbon accounting.

The RAP also targets the implementation of the new production curtailment regime and domestic crude supply obligation, annual asset performance assessment and reviews, enforcement of Domestic Crude Supply Obligation (DCSO) and Domestic Gas Distribution Obligation (DGDO) to improve domestic refining capacity, implementation of frontier exploration fund, decommissioning and abandonment (D&A) fund, zero tolerance to default in royalty payment, value creation through approval of annual work programme/budget and monitoring of financial viability, crude oil and gas pricing in contemporary terms, and revenue generation and implementation of zero default strategy on payment of royalty.

The Commission Chief Executive (CCE), Engr. Gbenga Komolafe in a statement issued in Abuja indicated that the foregoing represents in broad terms the key thematic focus areas that would underpin the Commission’s activities in 2004.

“These are in addition to the Commission’s commitment to its general objectives and functions as provided in the PIA and by implication all other laws relating to upstream petroleum operations in Nigeria.”

Engr. Komolafe stated that in focusing on these areas, the Commission aims to bring into rapid effect the transformation of the sector envisaged by the PIA (2021) and ramp up the efficiency and performance of the Sector.

He was optimistic that the implementation of these initiatives would in the short- and long-term increase revenues generated for the Government from the industry, improve the regulatory and operating environment, optimise value, generate jobs, and position the country as a destination for foreign direct investment for the Sector.

The CCE noted that as a strategy-driven organisation, the NUPRC is firmly committed to setting a clear agenda for the Nigerian upstream sector to engender efficiency and effectiveness in line with the PIA and government aspirations for a virile, functional and profitable oil and gas sector.

“The Commission will ensure that the RAP for 2024 and the near term is implemented vigorously by all concerned in the beneficial interest of operators, service providers, industry participants and other stakeholders, all in the overriding national interest.”

Giving an insight into why the Commission is focusing on the thematic areas, the CCE explained that the public policy statement is issued within the context of the global energy landscape which is currently in a state of rapid change in response to climate concerns and the challenges faced by the fossil fuel industry and economies long dependent on it.

“These challenges include climate change issue, the energy transition momentum, and the drive towards net zero emissions by the international comity of nations in such Forums such as the recently concluded United Nations Conference of Parties (COP) 28 conference in Dubai, United Arab Emirates, and such other international forums before it.”

Engr. Komolafe pointed out that Nigeria’s position on energy transition aligns with that of OPEC in the call for just, inclusive, equitable and balanced energy transitions.

“In the words of His Excellency, Bola Tinubu, at the United Nations General Assembly (UNGA) in September 2023, Mr. President underscored the fact that ‘African nations will fight climate change, but we must do so on fair and just terms (and) must accord with our overall economic efforts;” a position echoed by other world leaders at UNGA and similar gathering during 2023.

He further explained that the Agenda for Nigeria, Africa, and other resource-rich developing economies is that the evolving energy dynamics must be calibrated against geography, history, and politics as well as the need for energy justice, equity, inclusivity, and sustainability.

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FG to launch 2700 CNG buses, tricycles before May 29

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The Presidency on Sunday said it was ready to launch about 2,700 CNG-powered buses and tricycles before May 29 when President Bola Tinubu turns one year in office.

It said the Federal Government is set to deliver 100 conversion workshops and 60 refuelling sites spread across 18 states before the end of 2024.

The Special Adviser to the President on Information and Strategy, Mr. Bayo Onanuga, revealed this in a statement he signed Sunday titled ‘Presidential CNG initiative set for rollout.’

“From the end of May, Nigeria will take some baby steps to join such nations that already have large fleets of CNG vehicles.

“All is now ready for delivery of the first set of critical assets for deployment and launch of the CNG initiative ahead of the first anniversary of the Tinubu administration on May 29.

“About 2,500 of the tricycles will be ready before May 29, 2024…working towards delivering 200 units before the first anniversary of the Tinubu administration,” said the Presidency.

It added that in all, over 600 buses are targeted for production in the first phase which will be accomplished in 2024.

In October 2023, about five months after the removal of the petrol subsidy, President Tinubu launched the Presidential CNG Initiative to deliver cheaper, safer and more climate-friendly energy.

The CNG Initiative was designed to deliver compressed natural gas, especially for mass transit.

The Federal Government earmarked N100bn (part of the N500bn palliative budget) to purchase 5500 CNG vehicles (buses and tricycles), 100 Electric buses and over 20,000 CNG conversion kits, with plans to develop CNG refilling stations and electric charging stations nationwide.

The FG had said the initiative would ease the burden of the increased pump price on the masses.

“After months of detailed planning and background work, the committee driving the initiative is set to deliver on President Tinubu’s vision and promise,” Onanuga affirmed.

Part of Sunday’s announcement was the creation of a new plant on the Lagos-Ibadan Expressway that will assemble the tricycles while Brilliant EV will assemble electric vehicles when it receives the Semi Knocked Down components.

The Presidency explained further, “The SKD parts manufactured by the Chinese company LUOJIA in partnership with its local partner to support the consortium of local suppliers of CNG tricycles are set for shipment to Nigeria and expected to arrive early in May.

“In collaboration with the private sector, the PCNGI is set to deliver 100 conversion workshops and 60 refuelling sites spread across 18 states before the end of this year.”

Four plants owned by JET, Mikano, Mojo, and Brilliant EV located in various parts of the country are involved in the assembly of the semi-knocked-down components of the CNG buses, Onanuga revealed.

He added “JET, which has received the SKD parts is coupling the buses in Lagos and is working towards delivering 200 units before the first anniversary of the Tinubu administration.

“Brilliant EV will assemble electric vehicles. It is awaiting the SKD parts, which will arrive in due course. The electric vehicles it will produce are meant for states such as Kano and Borno, which do not have access to CNG for now.

“They will also be available in key Nigerian cities and university campuses. It must be noted that soon-to-be-completed gas pipeline projects initiated by the Buhari administration and being completed by NNPCL (the AKK Pipeline) will take gas into the hinterlands of North East and North West where there is a current paucity.”

Onanuga said the deployment of CNG buses and tricycles and the vision to get at least one million natural gas-propelled vehicles on our roads by 2027 will mark a major energy transition in our country’s transportation industry.

With necessary tax and duty waivers approved by President Tinubu in December 2023, the PCNGI committee is partnering with the private sector to deliver the promise on the initiative, he explained further.

Therefore, the private sector has so far responded with over $50m in actual investments in refuelling stations, conversion centres and mother stations.

Also, a safety policy document on 80 standards and regulations that must be strictly adhered to by operators has been developed and approved to ensure CNG conversions are done safely and reliably.

The FG also plans to sell thousands of conversion kits for petrol-powered buses and taxis that want to migrate to CNG at subsidised rates, especially to commercial vehicle drivers to bring down the cost of public transportation.

The Presidency said as part of private sector collaboration, NIPCO and BOVAS are involved in offering refilling services for the CNG vehicles and also serving as conversion centres.

“NIPCO is setting up 32 stations nationwide to offer the services. The company has completed the set-up of four of the CNG stations.

“Likewise, BOVAS is setting up eight stations in Ibadan, two each in Ekiti, Abuja and four in Ilorin. MRS is also involved.

“It is making efforts to announce where its refilling stations and conversion centres will be,” the Presidential aide explained.

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Recapitalisation: Access Bank confident of raising $300m – Aig-Imoukhuede

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Mr Aigboje Aig-Imokhuede, Chairman of Access Holdings Plc, says he’s confident that the bank would raise 300 million dollars in capital for Access Bank, considering the bank’s strong market position and shareholders’ support.

Aig-Imokhuede said this in an interview with the News Agency of Nigeria(NAN) on the sideline of Access Holdings’ second Annual General Meeting(AGM) held in Lagos.

NAN reports that the Central Bank of Nigeria (CBN), on March 29, directed commercial banks in Nigeria with international authorisation to shore up their capital base to N500 billion and national banks to N200 billion.

Similarly, non-interest banks with national and regional authorisation will increase their capital to N20 billion and N10 billion, respectively.

The recapitalisation exercise is expected to commence from April 1, to March 31, 2026.

Consequently, the shareholders of Access Bank, iat the AGM, unanimously backed the Group’s plan to establish a capital raising programme of up to $1.5 billion.

They also agreed to the subset initiative to raise up to N365 billion specifically, through a Rights Issue of ordinary shares to its shareholders.

The proceeds of the rights issue will be used to support ongoing working capital needs, including organic growth funding for the group’s banking and other non-banking subsidiaries

Aig-Imokhuede explained that having announced to embark on a capital raising through Right Issue, he was confident that the group’s shareholders would support the bank in the journey.

He stated that Access Holdings had p0a unique relationship with the capital market in Nigeria and internationally.

“It is not the first time CBN is coming up with such policy.

“Recall that in 2004 when CBN announced that all banks must recapitalise to the tune of N25 billion and Access Bank had about N3 billion of capital.

“Between 2004 and 2007, our team, when I was the CEO of the bank, raised two billion dollars of common equity capital.

“Therefore, in 2024 when Access Holdings  is much older, wiser, stronger, larger and significantly respected by the capital market with over 800,000 shareholders, raising 300 million dollars in capital for Access Bank, its banking subsidiary is not really much of a challenge.

“We signalled to the market first that we will be doing a Right Issue, which means that we must carry everybody along, in spite of our large institutional shareholders.

“Nonetheless, we believe in ensuring that shareholders, either large or small, continue with us on our journey.

“They have always supported us when need be with good reasons, because they believe in the company and the performance that would be delivered subsequently to such capital raising exercise.

“What is on the mind of our shareholders now is recapitalisation and they are also concerned about how their company continues to deliver returns,” he said.

Commenting on the CBN recapilisation policy, the chairman noted that Access Bank as a group endorses the CBN policy wholeheartedly.

Aig-Imokhuede described the policy as a good and sensible prudential regulation.

He added that banks, particularly after period of significant devaluation of domestic currency, volatility in the foreign exchange, and interest rate regime, are always encouraged to build up their capital buffer.

According to him, this is to ensure that whatever adverse effect that may arise as a result of the dynamic changes in the business environment would not affect their very concern.

In terms of performance and expectations from Access Holdings going forward, Aig-Imokhuede stated that the earning profile of the group, which spread across Nigeria, Africa and outside Africa subsidiaries, is very robust.

He said: “As an investor, you always look to see whether there is deep concentration where the profit is coming from; in our case, these arears are spread across three core areas that is of significant interest to local and international investors.

“If you look at the performance of banks in the year ended 2023 financial reports, you will see that all banks in naira terms have increased significantly their profitability as a result of the devaluation.

“But that isn’t the case with Access Bank, whose revaluation benefits come from the fact that it has significant international operations, because it is not a function of holding large foreign currency balances.

According to him, Access Bank, United Kingdom for example, is the largest and probably highest performing Sub-saharan African bank that has a license in the UK and making hundred of millions of naira of profit from the UK.

The chairman further said that this is not an accounting benefit that comes in the year 2023, but will continue, and with the operations of the bank in France, and across other European, Asia and Middle Eastern jurisdiction.

“We can see that the foreign currency benefit of profit in those locations are going to also accrued to the holding.

“The holding as an investor is also thinking of retail banking, which is like a utility. A retail banking with about 60 million customers is enough to sustain the bank anytime, irrespective of how volatile or uncertain the market is,” he said.

Access Holdings full-year results for the period ended Dec. 31, 2023, showcased an impressive 335 per cent increase in pre-tax profit to N729 billion from N167.68 billion in 2022.

The group also experienced an 87 per cent surge in gross earnings to N2.59 trillion from N1.39 trillion in 2022 and reported a remarkable 306 per cent growth in profit After Tax to N619.32 billion, from N152.20 billion posted in year 2022.

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Transcorp Power Plc grows PBT by 775% in Q1 2024

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Transcorp Power Plc (Transcorp Power), one of the electricity generating subsidiaries of Nigeria’s leading, listed conglomerate, Transnational Corporation Plc (Transcorp Group), has demonstrated impressive financial performance in its released Q1 2024 unaudited financial statements, for the period ended March 31, 2024.

The Company recorded N67.86 billion in gross earnings, compared to N21.04 billion reported in Q1 2023, reflecting a significant increase of 223%.
The strong performance is further demonstration of the Company’s strategic focus and effective execution, as part of Transcorp Group’s implementation of its integrated power strategy.
Commenting on the financial highlights, Evans Okpogoro, the Chief Financial Officer said, “The Q1 2024 results saw a gross margin of 51%, a cost to income ratio of 70% and net profit margin of 30% compared to Q1 2023 gross margin of 37%, cost to income ratio of 87% and net profit margin of 13%. This highlights the remarkable operational efficiency gains of the Company. Transcorp Power has continued to grow its revenue aggressively and consistently over the last five years. We expect that by year end 2024, we will see a similar growth trajectory recorded between FY 2022 and FY 2023.”
Transcorp Power MD/CEO, Peter Ikenga, commented on the results, “We are pleased to report further robust financial performance, despite sectoral challenges such as gas supply issues and macroeconomic challenges. Our ability to sustain growth amidst this environment shows the resilience of our business model and the efficient execution of our strategic initiatives.”
“We remain committed to leveraging our strengths to capitalise on emerging opportunities, drive sustainable growth and provide superior value to all our stakeholders. We will continue to prioritise ingenuity, operational excellence, corporate governance, and stakeholder engagement, to deliver superior value for our long-term growth”. He added.

 

Highlights
•Q1 2024 Revenue N67.86 billion, up 223%, compared to N21.04 billion in Q1 2023.
•Profit before Tax rose by 775%, amounting to N28.77 billion in Q1 2024, compared to N3.29 billion in the same period last year.
•Profit after Tax grew by 665% year-on-year to N20.1 billion in Q1 2024, compared to N2.6 billion in the same period last year.
•Total assets grew to N276.2 billion in Q1 2024, up from N223.3 billion in Q4 2023.
Transcorp Power Plc is an electricity generating subsidiary of Transnational Corporation Plc (Transcorp Group), one of Africa’s leading, listed companies, with strategic investments in the power, hospitality, and energy sectors.

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