Nigeria’s state oil company, NNPC Limited, has released its 2023 full-year audited results, showing a profit after tax of N3.29 trillion.

This represents a significant increase from the N2.5 trillion profit reported in 2022, marking a 31.6% year-on-year growth and the largest corporate profit reported by any Nigerian company, according to Nairametrics records.

Total revenue generated for the year was N23.9 trillion or $26.4 billion using the exchange rate of N907/$1 which was the closing rate used for the year 2023.

Revenue from Nigeria amounted to N21.3 trillion , representing 89.1% of total revenue, indicating that the corporation earned the majority of its income domestically rather than from international operations.

Key highlights

• Revenue – N23.9 trillion vs N8.8 trillion (171.5%)
• Gross Profit – N7 trillion vs N2.1 trillion (233%)
• Operating Expenses – N3.1 trillion vs N1.7 trillion (80.9%)
• Operating Profit – N4.3 trillion vs N694.2 billion (525%)
• Pre-tax Profit – N5.9 trillion vs N1.8 trillion (227%)
• Income Tax – N2.69 trillion
• Profit after tax – N3.29 trillion vs N2.5 trillion (30.6%)
• Total Assets – N246.8 trillion vs N58.5 trillion (321%)
• Net Assets – N28.5 trillion vs N9.2 trillion (200%)
• Cash and Bank Balances – N7.1 trillion vs N2.3 trillion (200%)
• Cash flow from operations – N10 trillion vs N4.6 trillion (117.3%)
• Cash flow from investing – N3.7 trillion vs N2.1 trillion (76.1%)
• NNPC Ltd reported that it does not have any external loans.

Total Assets surpass Nigeria’s nominal GDP

Even more remarkable is the company’s total assets, which were reported at a staggering N246.8 trillion ($272 billion using N907/$1 or $154 billion using N1,600/$1 as of August 2024) surpassing Nigeria’s nominal gross domestic product (GDP).

According to the National Bureau of Statistics, Nigeria’s nominal GDP was N229.9 trillion in the year ended December 2023.

While GDP and total assets refer to two different things in the realms of finance and an economy, it however highlights just how large the size of NNPC is.

A more relatable proxy is the company Net asset of N28.5 trillion which is the book value of NNPC. This represents around 12% of GDP more than the oil and gas contribution to GDP as of 2023.

The significant size of the oil company’s total assets was driven by its trade and other receivables, which stood at N162.9 trillion, and fixed assets (property, plants, and equipment) valued at N67.8 trillion, bringing the total to N230.7 trillion.

The increase in the value of trade and other receivables, as well as fixed assets, can be attributed to the impact of foreign currency translation, as most of the company’s assets are denominated in dollars.

Additionally, NNPC Ltd’s revenue from crude oil sales is also dollarized, which likely contributed significantly to the rise in naira terms.

The company reported that its currency translation rate for fixed assets was N907.1/$1 compared to N448.4/$1 in 2022.

For revenue, the company used an average rate of N644.2/$1, compared to N431.3/$1 in the previous year.

Analysis

A cursory review of the results reveals that the company’s revenue of N23.9 trillion is the largest it has ever reported.

Crude Oil Sales – The company generates revenue from crude oil sales, petroleum product sales, natural gas, power, and services.

• Revenue from crude oil sales reached N14 trillion, a significant increase from the N3.5 trillion reported the previous year.
• Interestingly, in terms of geographical markets, Nigeria generated N12 trillion in revenue, with Panama coming in second at N2 trillion.
• Crude oil sales revenue in 2022 was also higher from Panama, amounting to about N2.9 trillion, compared to Nigeria’s N545.3 billion.

Petroleum Product Sales – The company reported revenue of N7.1 trillion from petroleum product sales, up from N4.5 trillion the previous year.

• Petroleum product sales include the sale of fuel, kerosene, diesel, naptha, and other related products.
• Once again, Nigeria led in terms of geographical markets, generating N6.9 trillion compared to N4.3 trillion the previous year. This represents around 97% of total petroleum product sales, with sales to the Bahamas generating just N151.7 billion (up from N129.5 billion a year earlier).
• The NNPC has been the sole importer of petroleum products in Nigeria for years, relying on imports through its controversial Direct Sale, Direct Purchase (DSDP) structure.
• Following the removal of the fuel subsidy on May 29, 2023, NNPC Ltd’s profits from this division were expected to rise as product sales reflect higher prices for the majority of the year.

Revenue from Natural Gas – This category represents the invoice value of natural gas sold to third parties, generating about N2.3 trillion in the year under review, compared to N683 billion reported the previous year.

• Nigeria was again the major source of revenue, contributing N1.9 trillion (up from N638.7 billion in 2022), accounting for 82.6% of total revenues.
• The Cayman Islands also contributed to gas revenue, generating N402.7 billion, compared to N3.9 billion, N24 billion, and N16.3 billion from the UK, Panama, and the Cayman Islands respectively in the previous year.

Revenue from Services – This includes revenue from seismic contracts, time-based contracts, gas transmission tariffs, shipping, marine, and engineering services.

• The company generated a total of N464 billion during the year, up from N100.5 billion the previous year.
• Nigeria contributed N379.2 billion towards revenue from services, compared to zero in 2022. Another significant contribution came from Cyprus, which generated N80.49 billion.
• Interestingly, the entire revenue of N100.5 billion generated in 2022 came from the Cayman Islands. However, in 2023, the Cayman Islands contributed nothing to revenue.

Cash Payments – NNPC Limited reported a massive increase in its cash and cash equivalents by N5.232 trillion during the year, ending with a cash balance of N7.7 trillion.

To the Government

• Income tax paid was N497.2 billion in 2023, compared to N102.5 billion in 2022.
• Royalties paid in cash amounted to N669 billion, up from N76.5 billion in 2022.
• Dividends paid to its sole shareholder, the Federal Government, were N546.6 billion, compared to zero a year earlier.

Investing

• The company earned N230.9 billion from the sale of property, plants, and equipment.
• However, it paid N2.5 trillion for the purchase of property, plants, and equipment.
• An additional N370.2 billion was spent on the purchase of exploration and evaluation assets.
• Another N1.2 trillion was paid for the purchase of oil and gas properties.

Interest Payments

• NNPC Limited reported that it does not have any external loans, so the interest payments appear to be for legacy loans.
• During the year, it paid N441.45 billion in interest payments.

[Nairametrics]

Karl Marx once told us that history repeats itself, first as a tragedy and second as a farce. George Santanya put it differently. ‘’Those who cannot remember the past are condemned to repeat it’’. Does history repeat itself in Nigeria? Let’s examine recent developments. General Ibrahim Babangida came to power in August 1985 and in 1986, he launched an ambitious economic policy known as Structural Adjustment Programme (SAP). The core thrust of SAP was to diversify the economy away from hydrocarbon; create an industrial base that relies on domestic raw materials; deregulate the economy and liberalize the foreign exchange market. Privatization and commercialization were also integral its integral component.

At the first auction of the dollar at the newly introduced foreign exchange market (FEM) late 1986, the Naira plummeted from 0.8 Naira to the dollar to N4.0 to the dollar. It was the first official devaluation of the Nigerian currency since it was introduced and adopted as our legal tender on January 1, 1973. The steady depreciation of the Naira against the dollar and other major international currencies under SAP brought considerable hardships to businesses and the people, just as we have today. Raw materials and manufacturing inputs became too expensive to import, leading to factory closures; massive layoffs and departures of foreign-owned companies. Notable foreign businesses like Pfizer; Hoechst AG and the Dutch electronics giant, Philips left the country, similar to what’s going on now.

Nigerians were groaning as SAP bit harder and harder and there were complaints and grumblings all over the country, just as today, as local businesses were closing in droves. Meanwhile, the military top brass in government continuously asked people to bear with the government, make sacrifices and tighten their belts, but at the same time, they were wallowing in comfort and luxury. In 1989, violent riots broke out spontaneously in Lagos, Ibadan and some parts of the country.

Tagged ‘’SAP riots’’, the protests spread rapidly, but there were no known organizers or leaders. There was no social media then; but words moved around quickly through the whisper network.

Suddenly, a huge rumour emerged that Ebony magazine, the American celebrity magazine, had published an interview with Dr. Tai Solarin in which the social critic and human rights crusader had reportedly divulged that huge amount of dollars had been found in General Babangida’s foreign account. Nigerians rushed and bought off copies of the magazines, but it turned out that there was no such interview in it.

The military government went into an overdrive, trying to manage the crisis. The government reached out to the editors of the publication in Illinois, Chicago, and convinced them to issue a disclaimer. The magazine obliged, stating categorically that no such interview was carried. But the damage has been done. Mind you, Ebony has before then been enjoying generous advertising support from the government. Founded in November, 1945, Ebony focuses on chronicling and promoting the life and contributions of African Americans in the US. It used to be very popular in Nigeria, together with Time and Newsweek. It is an incredible turn of events that these magazines are no longer circulating in Nigeria due to the foreign exchange crisis which started with SAP.

The Babangida regime was rattled by SAP riots, just as the Tinubu administration was unsettled by the recent protests tagged ‘’End Bad Governance Protests’’. The following year (1990), there was a bloody military coup attempt to decapitate the IBB junta, hastening the movement of the nation’s capital to Abuja in 1991. Now, what are the striking similarities between the two epochs and what historical lessons can we draw?

First: The technocrats in the SAP era persistently assured us that the programme was the only panacea Nigeria had. ‘’There is no alternative to SAP’’ was the common refrain. IBB’s first Finance Minister, Dr. Idika Kalu Idika, who was later succeeded by Dr. SP Chu Okongwu, was an ardent SAP advocate. Both were Ivy League-trained economists and IMF and World Bank-honed technocrats. They preached and believed in the wonders of neoliberal economic theories. Complementing their efforts was Chief Olu Falae, who was the Secretary to the Military Government. A Yale alumnus, he was also an unrepentant SAP apostle. Together, they sold SAP to Nigerians like proselytizing clergies, telling us that SAP would work. They asked Nigerians to continue to make sacrifices, bore the pains and tightened their belts. Today, the two main technocrats in the Tinubu administration, Wale Edun and Yemi Cardoso as well as other professionals are busy assuring us that the Renewed Hope hardships would soon fade away, to give way to an era of economic boom. I don’t know if anybody believes them, but selling hope is always the easiest part of governance in this country, and more often than not, the technocrats are the major salesmen.

Second: Just as IBB, the Tinubu administration is bent on pushing through his agenda, no matter the agonies. The withdrawal of fuel subsidy and the massive depreciation of the Naira by last year have wrought the severest economic crisis this country have ever seen. In his eight-year rule, IBB withdrew fuel subsidy three times, (there were calls for ‘’SAP to have a human face’’), but the hunger, desperation and despondency in the population were not this brutal. Or is my memory failing me?

Third: This is not the first time there’ve been exodus of foreign firms from the country due to economic meltdown. By the very nature of their operations, these foreign businesses rely solely on imported raw materials, imported packages and imported inputs - without the slightest effort at backward integration – to conduct their businesses in Nigeria. To that extent, they are prone to serious exchange rate risks that crystallize whenever there are some external shocks in the economy. They are not here to stay because they are fair weather friends (assuming you can even call them friends). It’s therefore not a surprise that they’re taking off again. I’m rather surprised that Nigerian investors are not moving quickly to take their places.

Four: As SAP bit harder and harder, IBB was spending heavily and lavishly to maintain his stay in office. But in those days, the official vehicle of the Head of State was Peugeot 504 salon car! I don’t know what they drive these days, but with recent acquisitions, President Tinubu is indulging in the most lavish lifestyle unseen since 1999. New presidential aircraft; new presidential limousines; new residence for the Vice President, frequent foreign medical trips, etc; and the citizens are told to keep sacrificing!

Looking back, historians believe that SAP would have succeeded but for the pervasive corruption of that era. What will they write about Renewed Hope?

The Nigerian Securities and Exchange Commission (SEC) under Emomotimi Agama has revealed its plans to issue licenses to crypto exchanges in the country to complement the growing adoption of cryptocurrencies in the country.

In June the Nigerian SEC launched a new program aimed at speeding up the registration process of Virtual Assets Providers (VASPS).

SEC also announced amendments to its rules on Digital Assets Issuance, offering platforms, Exchanges, and Custody.

In an interview today on Bloomberg, Nigerian SEC Chief Emomotimi Agama reiterated his commitment to regulating cryptocurrency in Nigeria for the sake of young Nigerians who are neck deep into the industry.

“Being a crypto enthusiast and fintech enthusiast, I can tell you without doubt that this is going to happen sooner than you think.” 

“We must support the youths of this country to be able to achieve the benefit that is accruable in fintech. The market size is huge and it is growing,”

Fast-growing crypto economy  

Nigeria has one of the fastest-growing crypto economies in the world with a very high demand for crypto assets. This statistic has forced the hand of the Central Bank of Nigeria to lift restrictions on Nigerian banks facilitating cryptocurrency transactions after a ban that lasted for two years.

The Apex bank stated that it was improper to continue upholding stringent measures in a sector that is growing so fast and has massive potential.

Nigeria was named the second biggest economy in terms of crypto adoption last year and in August 2022 was named the most crypto-crazy country by volume of Google searches.

Crypto entities delist Naira peer-to-peer  

Following the crackdown on crypto entities earlier this year, top exchanges have closed down Naira P2P and Naira withdrawals on their platforms.

Big crypto exchanges like OKX and Binance have delisted their Naira p2p trading following accusations of currency manipulation and money laundering from Nigerian Authorities.

The Nigerian SEC in its latest move to issue licenses to crypto exchanges is a 360-turnaround in policy following earlier crackdowns on crypto entities.

The SEC chief explained in his Bloomberg interview that the regulatory body wants to provide a platform where crypto dealings will be transparent and devoid of bad actors.

“The SEC wants to provide a platform where people can formally do these things and we are able to get all of the information that we need,”

“What we will not encourage is the use of cryptocurrency to manipulate our currency,” Agama said.

What to know : The Nigerian authorities are still locked in a spat with Binance Ltd over claims of money laundering and tax evasion. Tigran Gambaryan a Binance executive is still been detained by Nigerian authorities at the time of the report.

[Nairametrics]

An Islamic cleric, Sheik Abdulrahaman Azzamfari, has weighed in on the persistent threats by bandits in Zamfara state.

In a video seen by Daily Trust, Azzamfari delivered a message to the government of Zamfara, expressing deep concerns about the escalating insecurity and banditry in the region.

According to him, the current administration’s approach had not effectively tackled the wave of violence, allowing bandits to sense a vacuum and intensify their attacks.

He said: “The Zamfara state government must know that we are in a horrible state. Residents have farmed but they are not getting anything from it.

“The situation is worse now. Hunger and high cost of things are forcing people to migrate and abandon farming, while some to join criminal activities.

“The deployment of soldiers alone cannot solve the issue. Mediation and reconciliation with the affected communities are crucial.

“The state government must take steps towards reconciliation, as the situation is beyond mere imagination and requires a collective effort to resolve.”

[DailyTrust]

The leadership of the Nigerian Labour Congress has threatened to down tools nationwide in the event that the Nigeria Police detains its President, Comrade Joe Ajaero.

The union handed down the threat on Tuesday morning at its headquarters, shortly after holding an emergency National Executive Council meeting to discuss the invitation of the NLC President by the police over allegations of terrorism financing.

The NEC resolved that Ajaero should honor the police invitation but noted that their legal adviser should seek more time for the NLC President to appear before the police authorities.

Comrade Ado Kabiru Sani, the Deputy President of the NLC, enjoined the nation’s workforce to remain on standby for further directives should the police act contrary to their expectation of detaining Ajaero.

His words: “As a committed labor center, we will honor the invitation of the police because we are not a faceless organization, but we are working with our lawyer for an extension of time.

“In the event that the President is arrested, all workers will down tools immediately. We should wait for further directives from our leadership.”

[DailyPost]

Oil producers, under the aegis of the Independent Petroleum Producers Group, have warned against being forced to sell crude oil to the Dangote Refinery and other local ones in Nigeria.

The IPPG also called on the Nigerian National Petroleum Company Limited to re-direct its allocated crude oil volumes to Dangote Refinery and other local refineries to mitigate the current crude supply shortage being experienced by the local refiners that is impacting local product availability in many parts of Nigeria.

The Chairman of IPPG, Abdulrazak Isa, in a letter dated August 16, 2024, and addressed to the Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission, Gbenga Komolafe, said the NNPC should utilise its allocated 445,000 barrels per day intervention crude oil volume to salvage the current situation as it did in many instances in the past.

Isa said some IPPG members already owned and or were supplying crude oil to local refineries but insisted that the NNPC was in a good position to mitigate the current crude supply shortfall faced by local refiners by leveraging its statutory crude allocation for meeting local domestic consumption.

“Historically, NNPC has always had an intervention crude oil volume (445kbopd) meant to satisfy the nation’s domestic consumption. This volume has always been used, under various swap mechanisms, to import refined products for domestic consumption.

“Since there is now domestic refining capacity to meet consumption, this dedicated volume should be reserved for all domestic refineries under a price hedge mechanism that can be provided by a suitable financial institution such as Afrexim Bank,’’ he stated.

Isa, however, maintained that, “Any national production above this allocated volume should be treated strictly as export volumes, adhering to the willing buyer, willing seller framework of the international market especially since the refiners will need to export excess products that surpass domestic demand thus boosting FX earnings.’’

The group expressed concerns over certain recent developments including the domestic crude oil refining requirements and crude oil production forecast for the second half of 2024, announced by NUPRC, as well as the request to all producing companies for their monthly quotations for crude oil supply to licensed refineries in Nigeria.

Specifically, IPPG said some of its members had received letters from the Dangote Refinery for crude supply nominations for October, and faulted the approach as bringing them under an obligation, saying it conflicted with the spirit of the willing-buyer, willing-seller framework prescribed by the Petroleum Industry Act 2021.

He asserted that the objective of enhancing the country’s petroleum value chain should be done within the confines of the law and existing obligations, expressing the confidence that an amicable solution could be reached by all stakeholders without jeopardising the existing commercial agreements, economic interests and business models of each segment of the oil and gas sector.

“While we fully support and commend the efforts of Nigerian entrepreneurs to enhance domestic refining capacity, it is important that no private sector business is unduly pressured into arrangements that may effectively subsidise another within the oil and gas value chain under any guise whatsoever.

“Under this willing-buyer, willing-seller framework, it is essential for refiners to negotiate and execute long-term crude oil Sales and Purchase Agreements with producers and their marketing agents. These agreements should follow industry best practices, with typical tenures ranging from one to five years,’’ the IPPG chairman said.

He added that some of them had also received allocation letters from NUPRC for the supply of specific volumes of crude oil to the domestic market for the second half of 2024, expressing concerns about its potential implications for the economy, especially the foreign exchange earnings through royalties and taxes.

The group noted, “We understand that the current allocation methodology appears to be based on a matrix of production forecasts by producers, issued technical allowable rates as well as crude oil requirements of domestic refineries, rather than actual local consumption needs. This raises significant concerns as it suggests that allocations are being determined based on the demands of refiners, which may exceed what is needed for domestic consumption.

“Such an approach could lead to inefficiencies and unfairly disadvantage producers. Therefore, it is crucial that refineries with excess capacity beyond local consumption do not exploit the Domestic Crude Oil Supply Obligations to the detriment of oil producers and other stakeholders, including the Government.’’

Isa called for transparency in how the allocations to oil producers were determined and requested NUPRC to provide clear details on the allocation criteria and methodology, while he sought an opportunity for IPPG to make input into the production forecast to ensure it accurately reflects operational realities.

The PUNCH recalls that Dangote and other local refineries have repeatedly accused international oil companies of not selling crude to them.

President Bola Tinubu later directed the NNPC to sell feedstock to the local refineries in naira

On Monday, the Federal Government announced that the deal would commence in October

The Publicity Secretary of the Crude Oil Refiners Association of Nigeria, Eche Idoko, told our correspondent last week that a meeting was held to that effect.

He disclosed that CORAN is asking for a crude supply contract with refineries that are operating and a conditional crude supply contract with those who are currently at ATC (Authority To Construct) and construction stages to enable the close out on their final investment decisions and bring their refineries to full operation.

The CORAN spokesperson has earlier stated that the supply of crude to local refineries in naira would bring down the cost of petrol and strengthen the naira against the dollar.

Recently, the management of Dangote Group insisted that the IOCs were still frustrating crude supply to the 650,000-capacity refinery.

In a statement, the group alleged that the IOCs insisted on selling crude oil to its refinery through their foreign agents, saying the local price of crude will continue to increase because the trading arms offer cargoes at $2 to $4 per barrel, above NUPRC official price.

The group also alleged that the foreign oil producers seem to be prioritising Asian countries in selling the crude they produce in Nigeria.

The PUNCH also reported two weeks ago that the Dangote refinery engaged in an exchange of words with the NUPRC over the alleged supply of 29 million barrels of crude oil to the refinery.

The Dangote Group had accused the NUPRC of failing to effectively enforce the Domestic Crude Supply Obligations regulations, saying the refinery had yet to get enough crude locally.

Reacting, the NUPRC debunked the claim, stating that it facilitated the supply of over 29 million barrels of crude oil to Dangote from January to June 2024.

The NUPRC argued that it had facilitated the domestic supply of crude oil to Dangote refinery and other refineries using the monthly production curtailment platform.

But in a swift response, the Dangote Group also denied receiving 29 million barrels of crude from any source.

Spokesperson for the Dangote Group, Anthony Chiejina, said, “We received NUPRC’s statement that they have facilitated the allocation of 29 million barrels of crude oil to the Dangote Petroleum Refinery and Petrochemicals, we would like to thank them for this allocation but at the same time, we wish to let them know that we are yet to receive these cargoes.

“Aside from the term supply we bilaterally negotiated with NNPCL, so far NUPRC has only facilitated the purchase of one crude cargo from a domestic producer. The rest of the cargoes we have processed were purchased from international traders.”

Chiejina added that all the refinery was asking for was for refineries in Nigeria to buy crude directly from the companies that produce it in Nigeria rather than from international middlemen

[Punch]

TikTok trends often capture the humor in everyday life, and the “Very Demure, Very Mindful” trend is a perfect example created by a beauty influencer, known as Jools LeBron.

LeBron, in a viral audio clip, humorously contrasted the idea of being “demure” and “mindful”.

In the forty-second TikTok video she shared, she flaunted a polished makeup look and described herself as “very demure, very mindful.”

To Jools, being “demure” means being mindful, modest, and considerate of both oneself and others, presenting herself in a refined and thoughtful way.

The trend quickly caught on as users showcased their clumsy or chaotic moments while the refined voiceover played in the background.

The irony and self-deprecating humor of the trend resonate with many, offering a refreshing break from the often curated perfection on social media.

This trend highlights TikTok’s unique ability to turn simple ideas into viral sensations, encouraging everyone to embrace their imperfections and laugh at life’s less graceful moments.

Who is Jools LeBron, creator of ‘very demure, very mindful trend?

Lebron is a prominent social media influencer renowned for her makeup and beauty tutorials, as well as her popular ‘Get Ready With Me’ videos.

Since 2021, she has also gained attention for her extensive collection of Bratz dolls and her passion for creating wigs.

According to Variety, Lebron has shared that the success of her ‘very demure very mindful’ videos has allowed her to travel internationally for event hosting and to support her transition financially. Lebron identifies as a transgender woman.

Vanguard News

In a tragic turn of events, Rt. Hon, Harford Oseke, the former Deputy Speaker of the Anambra State House of Assembly, has passed away.

The incident occurred on Monday when Oseke, who was engaged in his regular exercise routine at the Alex Ekwueme Square in Awka, the state capital, suddenly collapsed and died.

Efforts to revive him proved futile, and he was pronounced dead shortly after the incident. His body has since been taken to Apex Medical Centre in Awka.

Born in August 1960, Oseke hailed from Umuawulu in the Awka South local government area of the State. He was a learned scholar, having studied law and recently completing a Ph.D. in Public Administration. Beyond his academic accomplishments, he was a prominent figure in the freight forwarding industry in Port Harcourt and was actively involved in the importation of fishing feeds into Nigeria.

Oseke’s political career was closely tied to the All Progressives Grand Alliance (APGA). During Peter Obi’s tenure, he contested for a seat in the Anambra State House of Assembly, where he later served as the Majority Leader before ascending to the position of Deputy Speaker.

Despite his attempts to expand his political influence, including a bid to represent Awka North and South federal constituency in the House of Representatives, Oseke was defeated by the late Rt. Hon Anayo Nnebe.

Rt. Hon Harford Oseke was not only a dedicated public servant but also a devout Christian, recognised as a Knight of St. Christopher. He is survived by his wife and children.

[Leadership]