Daily Watch – Lagos and Ogun hog FDI in states, Nigeria fails to meet oil production target in January

11th February 2016

  • Analysts have told BusinessDay that many governors are still not creating the right environment to attract big money investors from whom their states could raise substantial revenues. Out of the N180.12 billion invested in all of manufacturing and agro-allied industries in the first six months of 2015, N128.3 billion went to Ogun, representing 71.23 percent. Ikeja and Apapa industrial zones got N15.74 billion and N6.98 billion respectively (12.61 percent combined), while Edo and Delta had only N106. 2 million (0.06 percent). Imo and Abia got N97.8 million in investment(0.05 percent), Oyo/Ondo/Osun/Ekiti combined had N12.53 billion (7 percent), Kano/Sharada/Challawa received investments worth N2.74 billion (1.5 percent). N48 million went to Kano Bompai (0.02 percent), N1.69 billion into Anambra/Enugu (0.93 percent), and N4.7 billion in Bauchi/Benue/Plateau (3 percent) within the period. Rivers got N1.2 billion in investment (0.65 percent), Kwara/Kogi received nothing within the period (0 percent) and Abuja had N30.7 million (0.02 percent). The Kaduna cluster got investment worth N6.010 billion (3.3 percent).
  • Nigeria’s largest company, the Dangote Group, is struggling with a constricted supply of foreign-exchange and is relying on its international cement operations and export-credit agencies to get around the shortage. The CBN’s policy of pegging the naira at 197-199 per dollar since March 2015 has led to a shortage of foreign-exchange and been widely criticised by investors and businesses who blame the restrictions for exacerbating the country’s economic slump. Growth was 3 percent last year, the slowest pace since 1999, according to the IMF.
  • Royal Dutch Shell has announced it is postponing its “final investment decision” to invest in Nigeria’s Bonga South West deep water. Shell was supposed to announce its final decision this year after it denied report last February that it had shelved the decision. According to the Punch, the project includes the construction of a new Floating Production, Storage and Offloading facility, with an expected peak production of 225,000 barrels of oil per day.The Bonga project itself, which began producing oil and gas in 2005, is Nigeria’s first deep-water development in water depths over 1,000 metres.
  • Fifty eight people were killed and seventy eight others injured after suicide bombers detonated explosives at the Internally Displaced Persons camp in Dikwa, Borno State. Emergency workers said the incidents occurred when the IDPs queued up to collect their morning food ration in a camp that currently accommodates over 50, 000 people displaced by the Boko Haram insurgency.
  • According to OPEC, Nigeria produced an average of 1.95 million barrels per day in January 2016, as against the 2.2 million target set by the 2016 budget. With a shortfall of 250,000 barrels per day, Nigeria’s oil revenue target fell by $7.5 million per day (at $30 per barrel), translating to $232.5 million in January. Although the country’s production levels fell below 2016 targets, it was an improvement of the 2015 production of 1.7 million barrels per day. For the month of January, OPEC contributed over 1.3 million barrels to the world oil oversupply, with Nigeria contributing to the oversupply.