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Nigeria: NNPC recorded a zero remittance to the Federation Account in January.

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By Derrick Bangura.

Despite rising international oil prices, the Nigerian National Petroleum Company (NNPC) Limited failed to return its statutory funding to the Federation Account, which is shared by the federal, state, and local governments, before January 2022.

It was the second time in less than a year that the national oil company (NOC) was unable to deliver a kobo to the joint account, following the same incident in April of last year, when the business announced zero remittance for the month.
In addition, a document detailing NNPC’s activities for the month under review, presented during the Federation Account Allocation Committee (FAAC) held last Thursday, indicated that the NOC expended a whopping N210.38 billion on petrol subsidy during the month.

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THISDAY recalls that with a deficit of approximately N2 trillion out of its projected N2.511 trillion, the NNPC was unable to remit roughly 80 percent of its projected contribution to the Federation Account in 2021.

For the entire 12 months of last year, the NNPC disbursed N542 billion as against the budgeted N2.511 trillion, despite a monthly contribution estimate of N209.3 billion. The N542 billion represented just about 21. 6 percent of the total expected contribution of the NNPC to the joint account.

The development underscored how a combination of factors, including declining oil production, rising subsidy payments, and high oil production costs, have hobbled the organization’s performance despite the increasing oil prices which overshot $105 per barrel last week.

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Earlier in the year, President Muhammadu Buhari had backtracked on the planned full deregulation of the downstream sector, including the wholesale removal of petrol subsidy, citing the negative impact it would have on the poor in the country.

For decades, Nigeria’s attempt to fully free the downstream oil and gas industry has met with a brick wall. The latest effort has also been pushed forward by about 18 months, effectively exempting the current administration which will exit by May 2023 from any burden.

A THISDAY’s analysis in January 2022, had shown that total deductions for petrol subsidy or what the government terms under-recovery was about N1.43 trillion for 2021.

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The journey to zero remittance in January was envisaged by close watchers of the industry as the NNPC only delivered a paltry N14.8 billion, N10.54 billion, and N20 billion in October, November, and December respectively last year.

In December, the three tiers of government shared N675.946 billion as FAAC revenue for November while in January, it shared N699.82 billion for December.

But the total funds shared in February markedly decreased to N574.66 billion, raising concerns over the capacity of sub-nationals to meet their current financial obligations.

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The amount shared by the federal, state, and local governments dropped to a four-year low this month, a huge blow to states that are already struggling to survive.
But in the latest monthly presentation to FAAC held on February 24, obtained by TheCable, NNPC pointed out that the N210 billion shortfall included a December 2021 value of N176.48 billion plus the outstanding value shortfall recovery of N33.90 billion accruing from 2021.

Furthermore, the oil firm stated that it would deduct N242.5 billion, which was about N143.7 billion for January 2022 recovery and November spot arrears of N98.8 billion, during next month’s FAAC meeting. It, however, stated that the national oil company recorded N383 billion as gross revenue from crude oil sales in January, a dip from the projected N414.9 billion.

The fall would significantly negatively affect states that are presently experiencing fiscal stress and had been kicking against deductions of the shortfall from FAAC remittances.

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While an ad-hoc committee of the National Economic Council (NEC) had recommended gradual deregulation of petrol prices by February 2022 to reduce the pressure on revenue accruing to states, recently Buhari asked the National Assembly to approve the N2.557 trillion budget for petrol subsidy in 2022.

Meanwhile, the Organisation of Petroleum Exporting Countries (OPEC) and its allies OPEC+ have revised down forecast for the 2022 oil market surplus by about 200,000 barrels per day (BPD) to 1.1 million bpd, according to a base scenario in a technical committee report seen by Reuters on Sunday.

The data which is part of a report the Joint Technical Committee (JTC) prepares for OPEC+ ministers – also showed stocks in the developed world standing at 62 million barrels below the 2015 to 2019 average by the end of the year.

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In a previous forecast, it had predicted the stocks would reach 20 million barrels above the same average by that point.

Ministers from OPEC and its allies, led by Russia, will meet on March 2 to decide whether to increase output by 400,000 barrels per day in April.
According to Reuters, the group’s output agreement has shown no fractures so far following Russia’s invasion of Ukraine, and the organization is likely to continue to a planned output increase despite crude exceeding $100 per barrel.

Data from a separate JTC study also showed that the group produced 972,000 bpd less than the deal’s targets in January, compared to 824,000 fewer in December.

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Headlines

NNPC Foundation Trains Over 3,000 Southwest Farmers in Climate-Smart Agriculture

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In a bid to promote food security and sustainable agricultural practices, the NNPC Foundation has successfully trained more than 3,000 farmers in the South-West geopolitical zone on climate-smart and modern farming techniques.

The training, which concluded on Friday in Ikorodu, Lagos, marked the end of the Southwest phase of the foundation’s pilot programme aimed at empowering local farmers and boosting agro-productivity.

Speaking at the closing ceremony, Managing Director of the NNPC Foundation, Mrs. Emmanuella Arukwe, described the initiative as a milestone in the lives of thousands of farmers.

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“Today marks the formal conclusion of the first phase of a national journey that speaks to resilience, food security, and economic empowerment,” Arukwe said.
“What began as a bold decision to support small holder farmers has translated into tangible action across three geopolitical zones (South-East, South-South, and South-West) in Southern Nigeria.”

She disclosed that a total of 3,860 vulnerable farmers across 10 locations in the three regions were trained in sustainable farming practices that improve productivity and market access.

“This achievement is not just a number, but a milestone in the lives of real people and real communities. We were able to strengthen farmers’ capacity to adapt to climate change,” she added.
“Through the training, we were able to improve access to markets, promote inclusive agriculture and especially gender representation. We also trained them on enhancing food production through sustainable techniques.”

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Arukwe noted that the programme would now move to the North-West, North-Central, and North-East zones as part of its next phase, saying the foundation is committed to supporting livelihoods nationwide.

“This is only Phase One. We will now turn our focus to the North-West, North-Central, and North-East zones. What we have achieved in the South will inform and strengthen our next steps,” she said.
“The NNPC Foundation will continue this mission, to support livelihoods, build resilience, and empower the hands that feed our families and beyond.
We have decided that most times you get a lot of requests from people asking us to give them palliatives and all kinds of things to help them.
But we think it is much better to teach people to fish than just give them fish so they can continue,” Arukwe explained.

Chairman of Ikorodu Local Government, Mr. Wasiu Adesina, while commending the initiative, urged the beneficiaries to apply the knowledge gained to boost productivity and profitability.

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“As we all know, agriculture is the bedrock of any nation. Without agriculture, there will not be a nation, because there will be no food to eat,” Adesina stated.
“It is the farmers that produce our food, and it is important that we train our farmers with new techniques in agriculture, and that is exactly what the NNPC Foundation is doing.

“To the farmers, you have to take advantage of this training and face the farming squarely. In some great countries like the United States and the United Kingdom, farmers are the most richest people in those countries.

“This is because they make a lot of money from farming. We need to inculcate that habit in Nigeria and develop ideas in farming. Even after my tenure, I am going back to farming, so, maybe I will ask the NNPC Foundation to train me so that I also join you to be a farmer.”

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He appealed to the foundation to provide further empowerment for the trained farmers to help them kickstart their agricultural ventures.

“If the farmers have land for farming, I believe the foundation will provide financial aid to keep their farms running,” Adesina added.

Also speaking at the event, the Lagos State Commissioner for Agriculture and Food Systems, Ms. Abisola Olusanya, represented by the Director of Fisheries, Mrs. Osunkoya Daisi, lauded the Foundation’s efforts in bolstering the state’s food security.

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“On behalf of the Lagos State Government, we would like to express our sincere appreciation to NNPC Foundation for training our farmers and for training all the farmers all over the country,” she said.
“Definitely, the training will help improve food production. We can see the impact of climate change effects in agriculture. I am sure farmers have been equipped with climate-smart agriculture techniques to improve production.”

The NNPC Foundation Ltd/Gte is the Corporate Social Responsibility (CSR) arm of the Nigerian National Petroleum Company (NNPC) Limited. It was incorporated in February 2023 to manage the company’s CSR initiatives and enhance Nigeria’s socio-economic development.

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Education

NUC grants ESUT full accreditation for Law, 7 other programmes

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The National Universities Commission, (NUC), has given full accreditation to the Enugu State University of Science and Technology (ESUT), for her Law programme.

According to the Public Relations Officer of ESUT, Mr Ikechukwu Ani, this is contained in a letter addressed to the institution’s Vice Chancellor, Prof. Aloysius Okolie, on Wednesday in Enugu by the NUC.

Ani said that in the letter, the Executive Secretary of NUC, Prof. Abdullahi Ribadu said the report was contained in the result of the October/November 2024 accreditation of academic programmes in Nigerian universities.

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Ani disclosed that other programmes in the institution accredited by the NUC include Master of Science in Business Management; Education Computer Science; Education Physics and Agricultural Engineering.

Other accredited programmes he said were Quantity Surveying; Urban and Regional Planning; and Applied Microbiology.

He said that the letter quoted Section 10 (1) of the Education National Minimum Standard and Establishment of Institutions, Act CAP E3, Laws of the Federation of Nigeria 2004 as empowering the NUC to lay down minimum academic standards for all academic programmes taught in Nigerian universities.

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He said the session also empowers the NUC to accredit such programmes.

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Crime

Court remands 2 over alleged attempted murder

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Court discharges man accused of burning father’s house in Abuja

An Ikeja Magistrates’ Court, Lagos, on Wednesday, remanded two persons, Olaitan Fasasi and Kehinde Tobiloba in a correctional facility over alleged attempted murder.

Fasasi, 40, and Tobiloba, 26, whose addresses were not provided, are being charged with conspiracy, attempted murder and membership of a secret society.

The Magistrate, Mr L.A Owolabi, did not take the plea of the defendants for want of jurisdiction.

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Owolabi directed the police to forward the case file to the Director of Public Prosecution for legal advice.

He thereafter adjourned the case until May 31 for mention.

The Prosecutor, Josephine Ikhayere, told the court that the defendants committed the offences at about 5.02p.m on Feb. 15, at Mushin, Lagos.

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She said that Fasasi, Tobiloba and others now at large, attempted to commit murder by shooting at a resident, Alfred Ademola.

“They armed themselves with a locally made gun. They belong to Eiye Confraternity, a group proscribed by law,”, she said.

Ikhayere said that the offences contravened Sections 230(1) and 411 of the Criminal Law of Lagos State, 2012.

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He said that the actions of the defendants also contravened Section 2(3)(a)(b)(c)(d) of the unlawful societies and Cultism Law of Lagos State Law.

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