NIGERIA: FG Cuts Supplies To Global Oil Traders

By Emmanuel Okubenji, Daily Times - Nigeria
The Federal Government has announced plans to award about $60 billion annual supply contracts to local firms.

According to a document sent to the winning firms, FG has allocated about 1.6 million barrels per day (bpd) through term contracts to 21 Nigerian firms, and 29 global companies.

The number of companies on the list grew from last year’s 45 and included many small African firms such as Tempo and Benny Peters, the document showed.

The oil, which amounts to around 580 million barrels sold over the next 12 months, is worth nearly $60 billion based on current premiums of the light, sweet crude to Brent futures.

The tender result, awaited since April, showed that around 45 % of the allocated oil was assigned for companies either based in Nigeria or owned by Nigerian companies including the Nigerian National Petroleum Corporation (NNPC) and its subsidiary Duke Oil, which doubled the size of its contract from last year to 60,000 bpd.

Global oil traders such as Glencore, Vitol and Trafigura, who have traditionally had a strong presence in the country, last year had their supplies halved to 30,000 bpd while Gunvor and Mercuria, Swiss-based traders, stayed unchanged from 2011 at 30,000 bpd.

"The desire to encourage Nigerian participation is understandable, but it only helps the country if these are legitimate companies, chosen in a manner that was competitive and free from patronage," Alexandra Gillies, head of governance at Revenue Watch Institute, said.

She added that the list of companies should be scrutinised carefully to ensure that all are operational oil firms and were fairly chosen.

Meanwhile, other winners include Indian Oil Corp and China's Unipec, the trading arm of Sinopec Corp, which both received 60,000-bpd contracts.

NIGERIA: U.S. Begins $119M Embassy Annex Project In Abuja

By Emmanuel Okubenji/Daily Times/Nigeria

The U.S., on Friday, commenced the construction of its embassy annex which will accommodate three of its agencies in the Diplomatic Drive, Central Area, Abuja.

The Ambassador, Terence McCulley, at the ground breaking ceremony said that the project, which will cover 7,500 square metres, would cost 119 million dollars.

McCulley said that the building will house the US Agency for International Development, Centre for Disease Control and Prevention, and the Department of Defence.

He also listed a five-level parking garage, a swimming pool and a marine security guard quarters as part of the project.

"Many of these team members work out of other office buildings, and must travel to the Chancery building for regular meetings," he said.

"After the completion of this annex, they won’t have to leave this property for meetings. Their trips farther afield will be simplified within a coherent support structure. This effort will also improve the conditions under which we all work."

The envoy said the initiative was a signal that the US considered Nigeria as an important partner.

"Our presence here is critical to maintaining that partnership. It is also a sign that the US is solidifying its commitment to staying engaged in Nigeria."

The Minister of Foreign Affairs, Olugbenga Ashiru, said the timing of the project was important, given the nation’s current security challenges.

"America believes in Nigeria and its future, and takes a long term view on our relations. We will continue to work together for the success of our Bi-National Commission," Ashiru said.

The Minister of FCT, Senator Bala Mohammed, said the new construction further indicated that Abuja was a safe destination for investment and tourism.

He commended the embassy for its contribution to the city’s development.

The event was witnessed by the Deputy Speaker of the House of Representatives, Emeka Ihedioha, Governor Babangida Aliyu of Niger and members of the diplomatic corps.

The U.S. embassy in Nigeria was moved to Abuja in 2000. It still maintains a consulate in Lagos and plans to open one in Kano soon.