CBN raises forex supply to manufacturers, oil marketers to get $200m for fuel imports

Posted by News Express | 8 April 2016 | 2,253 times

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As part of efforts to address the scarcity of foreign exchange that is impacting negatively on the real sector of the economy, the Central Bank of Nigeria (CBN) has increased dollar supply to manufacturers in the country.

The President, Manufacturers Association of Nigeria (MAN), Mr. Frank Jacobs, disclosed this in a phone chat with THISDAY on Thursday.

Similarly, the Nigerian National Petroleum Corporation (NNPC), in its financial and operations report for February, confirmed that it would in partnership with the CBN provide up to $200 million for oil marketers to enable them meet their fuel import allocations in the second quarter of this year.

The MAN president said in the last few days, his members across the country have reported increased forex allocation from the central bank and urged the CBN to continue along this path, adding that it would go a long way in resurrecting Nigeria’s ailing economy.

Jacobs said: “There has been increased allocation of forex to manufacturers in the last few weeks. I had a meeting with them (CBN) about a week ago and since then, our members have reported that there has been an improvement in allocation of forex to them. We are very happy with that because they (CBN) gave us the assurance and they kept to that.”

Meanwhile, the monthly financial and operations report of NNPC for the month of February has shown that the corporation in partnership with the central bank plans to provide up to $200 million to oil marketers to import petrol this quarter.

The report, which was released in Abuja yesterday, showed the amount of forex that the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, may have negotiated to source from the CBN and international oil companies (IOCs) for oil marketers.

The scarcity of forex is partly to blame for the perennial fuel shortages in the country.

“NNPC is also collaborating with CBN to provide $180 – $200 million to support major private importers,” the report stated in one of its annotations on NNPC’s key challenges within the period.

It showed that the NNPC has also begun plans to secure an offshore petroleum floating storage facility around Port Harcourt to service supplies to the eastern and northern part of the country through dispatches to Warri, Port Harcourt and Calabar.

The report also showed that in February, NNPC supplied over 1.1 billion litres of petroleum products to ensure constant product supply at its 559 NNPC retail outlets.

This, it added, was based on the reluctance of private marketers to import fuel due to forex scarcity and its assumption of the role of sole importer of products into the country.

The report also showed that a break on the 48-inch Forcados export line contributed immensely to its loss of N24.23 billion in February, adding that the situation denied its upstream subsidiary, the Nigerian Petroleum Development Company (NPDC), the opportunity to earn revenue from crude oil sales of about N20 billion.

“The huge deficit in the month of February 2016 was due to a production shut-in occasioned by vandalism of the Forcados export line. This situation denied NPDC the opportunity to earn revenue from crude oil sales of about N20 billion.

“This 48-inch export line was vandalised in February 2016. It crippled NPDC and all JV partners’ ability to export crude oil from the terminal. This situation led to the declaration of force majeure by SPDC occasioned by production shut-in of about 300,000 barrels of oil per day.

“This infers that circa 130,000 barrels per day of NPDC crude will be impacted for about eight weeks as repair works is ongoing. This adversely impacted on NNPC’s February 2016 report leading to a loss of about N20 billion of NPDC oil revenue,” the report stated.

On other oil sales during the period, the NNPC report said that a total of 66.68 million barrels of crude oil and condensates were lifted in the month of January 2016 by all parties.

Of this volume, 23.79 million barrels of crude oil were lifted by NNPC on behalf of the federation, comprising 16.69 million barrels lifted on the account of NNPC while 6.10 million and one million barrels were managed for the Federal Inland Revenue Service (FIRS) and Department of Petroleum Resources (DPR), respectively.

The report said of the 16.69 million barrels lifted on the account of NNPC, 11.30 million barrels and 5.38 million barrels were for the domestic and export markets, respectively.

The crude oil, it noted, was valued at an average oil price of $28.38 per barrel and exchange rate of N196/$, while the domestic crude oil lifted by NNPC was valued at $320,723,227.98 or a naira equivalent of N62, 861,752,684.08 for the period.

The report added that the remaining crude oil lifted for exports was valued at $156,189,385.88 at an average price of $29.02 per barrel, while the total value of crude oil lifted on the account of NNPC was $476,912,613.86.

•Extracted from a THISDAY report. Photo shows CBN Headquarters.


Source: News Express

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