The current economic situation requires that everyone begin to look for alternative sources of income. As people would say, the economy is not smiling. Prices of goods and services have…
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NIGERIAN Government gas utilisation policy has received a boost as the NIPCO Gas Limited (Consortium) signed a tripartite agreement with the NNPC Gas Marketing Limited (NGML) and Lekki Free Zone Development Company (LFZDC) to build pipeline infrastructure and supply gas to industries in the Lekki area of Lagos.
The gas pipeline, which is expected to be completed in six months, is planned to supply gas to industries in and around the Lekki Free Zone and feed a 24 Mega Watts (MW) power plant in that axis.
Speaking at the signing ceremony in Lagos, the Managing Director, NIPCO Gas, Nagendra Verma said the pact would aid smooth distribution of gas to Lekki area of Lagos State. “Our intention is to supply gas, which is economical, cheaper and environmental friendly. It also enhances efficiency of equipment and will ultimately boost the economy of this country. We are developing gas infrastructure to meet the power requirement of the industries,” he said.
Managing Director, LFZDC, Dai Shunfa, said: “We have been crying for gas all these years. We negotiate the agreement with NIPCO and NGML and it has become reality today. I believe this is a win-win situation for the parties. This will be a key facility for us. It means we have to bring more end users for NGML consortium, expressing hope that the laying of the pipe-line will be facilitated.
“We have our power plant now, which is 24MW, we are using CNG and LNG, which is not sufficient for us. What we need is a pipeline gas and that was why we engaged this consortium to connect the gas to Lekki Free Zone, not only to connect the power plant. With this infrastructure we can attract more investors who will use the gas.”
Managing Director, NGML, Justin Ezeala, said: “Our partner (NIPCO) is a reliable firm and an industry leader in pipeline laying. We have worked with them for years and we discovered that, among our partners, they are the most consistent to market.
Nigeria’s debt service costs will continue to rise in the short to medium term, but the country has enough dollar liquidity to service the debts in the next two years, Fitch, a global rating agency announced yesterday.
In a report, the agency said rising debt service cost will hobble the Nigeria’s ability to use fiscal policy to support economic growth, Fitch’s sovereign ratings director, Jermaine Leonard, said.
Nigeria will spend N6.31 trillion ($14.30 billion) on servicing its domestic and foreign debt next year.
Debt Management Office (DMO) data showed that Nigeria total debt stock stood at $103.3 billion (N42.8 trillion) as at June 30, 2022.
Fitch downgraded Nigeria’s rating to ‘B-’ with a stable outlook last week, in part due to a deterioration in Nigeria’s debt servicing costs.
The government’s budget deficit as percentage of revenue will rise to 111 per cent next year, up from 74 per cent this year, according to ministry of finance data, showing authorities are spending more than they are collecting to pay off debt.“That’s going to have a deleterious effect on the government’s ability to use fiscal policy to support economic growth and to do all the things that it needs to do over the next few years,” Leonard said.
old a Lagos conference.
“We do think that this debt servicing issue is something that will remain at the forefront of our concerns over the next two to three years.”
Despite high oil prices, Nigeria’s capacity to increase revenue has been affected by low oil output, a result of vandalism of pipelines and crude theft.
Leonard, however, said Fitch did not see Nigeria announcing a debt restructuring anytime soon and was comfortable that Africa’s biggest economy had enough dollar liquidity to meet external debt repayments in the next two years.