News from Nigeria

News headlines

Lower House of parliament passes fiscal plan, no subsidy: The House of Representatives on Thursday approved the government's medium-term fiscal framework (MTFF) but refused to include plans to remove fuel import subsidies in a major setback for the controversial proposal. According to the House, the proposal on fuel subsidy as contained in the revised fiscal strategy paper is premature and sources other than savings from the proposed subsidy removal should be explored to finance expected budget deficits. The MTFF states that aggregate expenditures next year will be N4.7trn (US$29.2bn). Assumptions underpinning next year’s budget as passed by the house include a benchmark oil price of US$70 a barrel, exchange rate of N155 to the US dollar, average oil output of 2.48mbpd and a budget deficit of 2.7% of GDP. (Source: Reuters)

Shell sells two Nigerian oil blocks for US$488m:  Royal Dutch Shell said on Thursday it had completed the sale of two Nigerian onshore oil blocks to a local consortia for a total of US$488m. Shell sold its 30% stake in Nigerian onshore oil block OML 42 to local consortium Neconde Energy, which includes Nestoil Group, Aries E&P Company Limited, VP Global and Poland's Kulczyk Oil Ventures, for US$390m. Shell also confirmed the sale of its 30% stake in block OML 26 to First Hydrocarbon Nigeria (FHN), which is part-owned by Afren, for US$98m. Afren and FHN announced the sale earlier on Thursday. (Source: Reuters)

Total to invest US$200m in Sao Tome oil block: French oil group Total says it will invest US$200m in 2012, drilling an oil block in a Joint Development Zone (JDZ) between Sao Tome and Nigeria.  According to Francois Le Cocq, a Total executive who made the disclosure, drilling is scheduled to begin in the first quarter of next year. Total said last year that it had acquired Chevron's 45.9% interest in Block 1 in the JDZ, which it will operate in partnership with Addax Petroleum, Dangote Energy Equity Resources and Sasol Exploration and Production Nigeria. (Source: Reuters)

Addax Petroleum to boost crude output in Nigeria:  Addax Petroleum, the Nigerian unit of China Petroleum & Chemical Corp or Sinopec, plans to boost oil output to more than 85,000bpd by the end of 2012. Addax currently produces 75,000bpd from over 90 wells at its onshore oil mining lease (OML) 124 and offshore OML 123 and 126. (Source: Bloomberg)

ETI gets US$285m loan from Nedbank: Ecobank Transnational (ETI) said on Thursday it had obtained a US$285m loan from South Africa's Nedbank to support ETI's acquisition of Nigerian rival Oceanic Bank and consolidate its footprint on the continent. ETI said Nedbank will be able to convert the loan into 20% equity in Ecobank in 24-36 months. (Source: Reuters)

UBA seeks approval to restructure: United Bank for Africa (UBA) said on Thursday it will seek shareholders' approval to transfer its subsidiaries into a newly-formed holding company, in line with regulatory requirements to separate core lending from other businesses. Under the new structure, 40% of the present UBA group will be transferred to the holding company, which will be listed sometime next year, while the bank will retain 60% of its present form and operate as a subsidiary of the holding company. (Source: Reuters)

Olam to invest in Nigeria paddy, wheat milling: Singapore commodities firm Olam International, whose businesses include processing agricultural products and food ingredients, said on Friday it will invest about US$50m to expand its wheat milling capacity in Nigeria. Olam, whose shareholders include Singapore state investor Temasek, said in a separate statement on Thursday that it will invest US$49.2m to set up a 6,000 hectare greenfield paddy farming and rice milling facility in Nigeria. (Source: Reuters)