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Wabote Strengthens Commitment To Rewarding Local Contents In The Upstream Sector As Lamikanra Fuels Legal Fire Works

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Wabote Strengthens Commitment To Rewarding Local Contents In The Upstream Sector As Lamikanra Fuels Legal Fire Works

Wabote Strengthens Commitment To Rewarding Local Contents In The Upstream Sector As Lamikanra Fuels Legal Fire Works

 

 

 

The expected revenue generation of, at least, $10 billion every year when all the oil and gas industrial parks being built by the Nigerian Content Development and Monitoring Board, NCDMB, fully take off in different oil producing states in the Niger Delta, appears to be the most assuring signal from the South South geo political zone that commencement of sustainable developments is no longer a function of speculative endeavour.

 

 

 

 

 

 

In a recent disclosure by NCDMB Director of Corporate Communications, Engineer Ginah O. Ginah, the monies are expected to be generated from world standard parks that are at different stages of construction across the Niger Delta region which is part of the Engineer Simbi Kesiye Wabote’s led NCDMB efforts to significantly increase local contents in the oil and gas industry and generally drive Nigeria’s industrialisation.

 

 

Wabote Strengthens Commitment To Rewarding Local Contents In The Upstream Sector As Lamikanra Fuels Legal Fire Works

 

Already, the first of such parks built at Odukpani in Cross River State is ready to commence business as many manufacturers and industrialists have indicated their interests to take advantage of the scheme.

 

 

 

But legal attempts to create a clog on these implementable initiatives were recently addressed by a Federal High Court sitting in Yenagoa, Bayelsa State, which, on Tuesday, May 9, 2023 delivered a landmark judgment confirming the authority of the Nigerian Content Development and Monitoring Board (NCDMB) to collect the one percent Nigerian Content Development Fund (NCDF) levy from every contract awarded in the Nigerian oil and gas upstream transaction as mandated under section 104 of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act.

 

 

 

 

 

The upstream section is the exploration, drilling and production end of oil industry as opposed to the downstream sector – which is the product refining and marketing sector.

 

 

 

 

 

 

Earlier, a group of Nigerian Drilling Companies known as Incorporated Trustees of the International Association of Drilling Contractors, IADC, had instituted a case against the NCDMB, seeking to stop the collection of one percent NCDF levy.

 

 

 

 

 

 

In the lawsuit – Suit No.FHC/YNG/CS/178/2022, IADC challenged the powers of NCDMB to demand the one percent NCDF levy from their members and contractors.

They averred that the demand is contrary to the clear provisions of section 104(2) of the NOGICD Act which states that “the sum of one percent of every contract awarded to any operator, contractor, subcontractor, alliance partner or any other entity involved in any project, operation, activity, or transaction in the upstream sector of the Nigeria oil and gas industry shall be deducted at source and paid into the Fund.”

 

 

 

 

 

The group also obtained an ex parte injunction against the Board prohibiting the demand, collection or anything whatsoever either by itself or through its agents, representatives, or privies in relation to NCDF payment or remittance from their members and contractors pending the final determination of the lawsuit.

 

 

 

 

 

But an experienced and highly respected Counsel in Oil & Gas legal space, Oladejo Lamikanra, SAN, who represented NCDMB, argued that section 104 of the NOGICD Act is charging section and a revenue clause of the Act and so must be construed liberally in favour of the operator.

Oladejo Lamikanra, SAN, asked the court to set aside the interim orders granted the Drillers and dismiss the case.

Oladejo Lamikanra argued further that there is no double taxation but rather reading the NOGICD Act as a whole, NCDMB has acted properly and fairly within its statutory powers.

The Drillers association, represented by Adedapo Tunde-Olowu, SAN, of the prestigious Lagos based Lawfirm AELEX, argued that the association should be exempted from the 1% levy and that NCDMB has no power to impose the statutory levy.

Tunde-Olowu, SAN pressed further that once an operator in the upstream sector has paid the 1% levy, their subcontractors to (whom they issue ancillary or subsidiary contracts) should not be subject to another 1% levy. He emphasized that it amounts to “ double taxation” and so have refused to pay the levy.

In further submission, the NCDMB’s representative said the case of the Drillers amount to biting the same fingers that has fed them and allowed them to flourish and prosper.

The legal expert noted that section 104 is the revenue base and life-blood of the Nigerian Content Board, stressing that if the Drillers ( an association of over 60 members in the oil & gas industry) succeeds, it would mark the demise of the Nigerian Content Board and with it, the accrued benefits of progressive development and promotion of Nigerian participation and local content in the oil & gas industry would be destroyed.

On Tuesday May 9, 2023, the Court upheld all the submissions of the NCDMB based on the arguments of Dejo Lamikanra, SAN of the Port Harcourt & Abuja based prestigious law firm-Creeks & Shield, Solicitors.

The court said that even if the preliminary objection against the case has not succeeded, it would still have dismissed the Drillers case on the merits because the burden of proving their case was on them ( the Drillers) and that on balance, the plaintiff failed to supply any credible evidence to support their claims in the originating summons.

The presiding judge Honourable Justice Isa H Dashen disagreed with the Drillers case. The court set aside the interim orders it granted against NCDMB in July 2022.

Further the Court dismissed the case of the Drillers as totally lacking in merit and incompetent. It held that NCDMB has the statutory power to impose 1% levy on all operators in the upstream sector of the oil and gas industry and that the levy on subcontractors of Drillers does not amount to double-taxation as claimed by Plaintiff Drillers.

While the case was on, the Committee on Oil & Gas of the National Assembly attempted to wade into the dispute but the interim ex parte order of court granted the Drillers in August 2021 frustrated the two hearing dates scheduled by the NASS.

For context, since 2010 when the NOGICD Act was enacted by the Goodluck Jonathan’s administration, local content and participation of indigenous oil & gas operator has increased from less than 10% to over 35% and growing.

Meanwhile, reports have it that the legal battle may be far from over as the theatre of “ war” has only shifted from Federal High Court to Court of Appeal where Tunde-Olowu, SAN and Oladejo Lamikanra SAN would further slug it out.

Available information indicates that one of the judicious applications of the Fund by NCDMB is the credit scheme extended to Nigerian oil and gas businesses through the Nigerian Content Intervention Fund (NCI Fund), managed by the Bank of Industry (BoI) and the Nigerian Export-Import Bank (NEXIM-Bank).

Other notable utilizations of the NCDF are the development of Nigerian Oil and Gas Parks Scheme (NOGAPS), equity participation in notable third-party ventures, Human capacity development initiatives, and the institution of the Nigerian Content Research & Development Fund as well as other R&D initiatives.

Other applications are the construction of the 17-storey Nigerian Content Tower, entrepreneurship schemes and competitions, and the ongoing construction of the Conference Hotel Project (CHP).

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As Wale Edun Re-awakens an Economy on the Edge of Collapse

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As Wale Edun Re-awakens an Economy on the Edge of Collapse

As Wale Edun Re-awakens an Economy on the Edge of Collapse

When President Bola Tinubu appointed Olawale Edun as Nigeria’s finance minister and coordinating minister of the economy in August 2023, many analysts wondered how he, alongside his colleagues in the fiscal and monetary authorities, would rejig an economy on the edge of total collapse.

As Wale Edun Re-awakens an Economy on the Edge of Collapse

A few months before the appointment was announced, Tinubu had just won a brutally disputed February 2023 presidential election, which was being challenged by his main opponents in court at the time. Vice President Atiku Abubakar, candidate of the People’s Democratic Party (PDP) and Peter Obi, the candidate of the Labour Party, both came second and third in the keenly contested elections. Both men claimed that the elections were rigged, and that Tinubu should be so removed from office.

Although Tinubu’s elections would later be confirmed by the election tribunals and the Supreme Court, the administration at the time faced serious legitimacy issues.

In that sense, among market analysts and economic experts, Wale Edun’s job was considered near-impossible.

It is important to state clearly that the scepticism that trailed his appointment didn’t stem from any doubt about Wale Edun’s expertise and competence to drive the reform; far from it!

In fact, he came very prepared for the job, as results of the past few months have shown.

Olawale Edun has a background in merchant banking, corporate finance, economics and international finance at both national and international levels. He is a former Chair of ChapelHillDenham Group, Lagos, a leading investment bank. He was an executive director of Lagos merchant bank, Investment Banking & Trust Company Limited, now Stanbic IBTC. He is also the Chair of Livewell Initiative, a not for profit organisation that specialises in health literacy advocacy and practical training in Nigeria, and a Trustee of Sisters Unite for Children, a not for profit institution that focuses on helping street children in Lagos.

But there were just too many hurdles for the President Bola Tinubu government to cross at the time, amid poor fiscal position, widespread poverty, dwindling revenues and drifting economy.

At the time of Edun’s appointment, Nigeria’s inflation rose to an 18-year high in July 2023. The country also faced widespread insecurity, mounting debt burden, high unemployment and slow growth which stoked tension among the population already struggling with a high cost of living.

To rejig the economy, Tinubu decided to embark on some of the boldest reforms that Nigeria has seen in years, including scrapping a popular but costly petrol subsidy and removing exchange rate restrictions.

Consequently, the naira weakened to record lows amid sky-high inflation and poverty.

Gains of Reforms

But in recent months, the pains witnessed by Nigerians seem to be paying off gradually as the gains of reforms are now manifesting.

Nothing demonstrates the confidence being restored in the local economy like how Nigeria recently achieved a milestone with its first-ever domestic dollar bond, which was oversubscribed by 180%.

Initially aiming to raise $500 million, the government finally secured $900 million in commitments. This result surprised many, given Nigeria’s fragile economic situation.

Wale Edun described the bond as a landmark for the country’s domestic market, adding that this success demonstrates investors’ confidence in the country’s ability to turn the economy around.

The bond, with a 9.75% coupon paid semi-annually over five years (an effective rate of 9.99%), is aimed at financing strategic projects in key sectors such as energy and infrastructure. The bond is part of a broader $2 billion program registered with Nigeria’s Securities and Exchange Commission. According to the terms of the issuance, the government has the option to absorb additional subscriptions up to the program’s full $2 billion limit.

The 180% oversubscription was indeed a major victory, drawing interest from Nigerian investors, the diaspora, and international institutions.

But before then, there has equally been some gains in the economy, all pointing towards Edun—-and indeed Tinubu’s—-rejig of the economy.

Already, the Federal Government no longer depends on the Central Bank of Nigeria (CBN) to fund its emerging obligations,a major part of the fruits being yielded by ongoing efforts to improve efficiency and ramp up revenues.

In September, Edun said the government has exited the use of Ways and Means advances for meeting emerging financing obligations, a practice that had been rampant until recently.

Within the periods, the federal government through the Central Bank of Nigeria cleared all outstanding matured and verified FX backlogs totaling $6 billion owed to various creditors, including foreign airlines.

All of the payments were without any depletion in the nation’s foreign reserves. Rather, the reserves have risen to a high of $41 billion, even as the nation remains at a far better fiscal position than it was before the new government came in, now meeting its obligations to creditors without hassles.

In recent months, it has become equally obvious that government was working to plug all loopholes and optimise Nigeria’s financial potential by ensuring that the country’s sovereign assets are fully harnessed for growth and development. Nigeria has huge stranded assets, which the government is expected to unlock to boost its financing liquidity, and efforts are being directed towards this path in recent months.

Another major gain of the government’s macroeconomic reforms is that the country now records a monthly net inflow of about $2.35 billion into its foreign exchange (forex) reserves in the recent months, an inrease that has contributed significantly to the stability of the naira in the forex market. Consequently, between Monday and today, Wednesday, the Naira has gained over N140 in the parallel market while strengthening and stabilizing in the orthodox market.

One equally important development that demonstrates the efficacy of Edun’s managerial competence was evident in the recent endorsement of the economic reforms by the International Monetary Fund. In her engagement with President Tinubu in November, the Managing Director of the International Monetary Fund, Kristalina Georgieva, commended Nigeria’s economic reforms under the leadership of Tinubu.

The IMF chief highlighted the progress made by Nigeria in its quest for economic stability and assured that the IMF remains strongly committed to supporting Nigeria on its path to recovery and sustained development.

What all of these have shown is that while reforms championed by Edun, Cardoso and others can be painful and tortuous, the gains can only reset a collapsing economy and fix a better future for younger Nigerians.

Like Georgieva said, the reform will surely “accelerate growth and generate jobs for its (Nigeria’s) vibrant population.” Surely, Wale Edun and others deserve all the support they can get.

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NAFDAC Begins Crackdown on Alcoholic Beverages Below 200ml

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NAFDAC Begins Crackdown on Alcoholic Beverages Below 200ml

NAFDAC Begins Crackdown on Alcoholic Beverages Below 200ml

 

The National Agency for Food and Drug Administration and Control (NAFDAC) has launched an enforcement campaign against the sale of alcoholic beverages in sachets and PET bottles below 200ml.

The enforcement began at Rumuokoro Market in Port Harcourt, Rivers State, where large quantities of the banned products were discovered in two shops. A statement by the South-South Zonal Director of NAFDAC, Pharm. Chukwuma Oligbu, and signed by the zone’s Public Relations Officer, Cyril Monye, confirmed the operation.

The seized items included hundreds of cartons of alcoholic drinks in sachets and PET bottles. Efforts to remove the products were met with resistance from traders, who reportedly obstructed the exercise.

Background on the Ban

Pharm. Oligbu explained that manufacturers were given a five-year grace period, starting in 2018, to phase out the production of these beverages. This period ended in December 2023, with the official ban announced in February 2024 by NAFDAC’s Director-General, Professor Mojisola Adeyeye.

“The ban was a decision of a federal government multilateral committee involving all stakeholders. NAFDAC will not tolerate the continued endangerment of young Nigerians through the consumption of these spirits,” Oligbu stated.

Warning to Manufacturers and Traders

The statement reiterated that manufacturers must halt production of the prohibited products. NAFDAC vowed to intensify its crackdown, targeting supermarkets, shops, and street vendors across the country to seize banned items.

This action is part of NAFDAC’s broader efforts to safeguard public health and address the dangers posed by the consumption of high-alcohol-content beverages in sachets and small containers.

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Staff Members Celebrate FIRS Boss Over Enhanced Welfare Package

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Staff Members Celebrate FIRS Boss Over Enhanced Welfare Package

 

The Executive Chairman of the Federal Inland Revenue Service, FIRS, Zacch Adedeji Ph.D, on Thursday was received by jubilant workers who had assembled at the agency’s headquarters at Sokode Crescent, Wuse Zone 5, Abuja, to appreciate him for his numerous welfare packages for them.

 

As early as 8 am, the workers who said they have continuously enjoyed uncommon welfare packages from Adedeji since he assumed office over a year ago, carried placards with various appreciative inscriptions like ‘we love you Zacch’, ‘You’re a man of the people’, ‘We support you 💯…’ and many others.

They sang appreciative songs, danced and engaged in a form of gyration. No sooner had they started than the Chairman arrived. Others who had stayed under the shed for protection against the Abuja sun joined in leading the Chairman to his office.

A statement by Sikiru Akinola, Technical Assistant (Print Media) to Adedeji, quoted the staff members as saying that Adedeji has proven himself as a staff welfare-minded administrator.

The statement noted that FIRS staff were happy for the welfare packages extended to them, most especially the increment in salary.

The statement quoted a staff member as saying: “Being someone who is deliberate and intentional, Zacch Adedeji Ph.D is always concerned and mindful of those around him and people whose paths have crossed with him. He is our boss and our friend. We all can attest to that. So for us, we decided to gather today to appreciate him. This was something he had avoided. More than two occasions, we had attempted it. When the news of the increment was first spread in-house, it was well-received. During the one year anniversary, the leadership of the staff union openly revealed that this is the first time they would sleep with their eyes closed as members don’t have any complain to warrant a confrontation with the leadership of FIRS.”

Another staff was quoted as saying: “The Executive Chairman did not even brief many people before increasing staff salary and other welfare packages. He is someone who believes that those who help in making sure the audacious target of N19.4 trillion for the 2024 is met should also be properly treated to motivate them. Few months ago, in what many of us described as unprecedented, he had increased our salary. It was uncommon. This was after many other packages had been introduced. He listens to our yearnings and aspirations”, she said.

In their various remarks at the gathering, most of them agreed that no Executive Chairman of the agency had been so celebrated like Adedeji in just a year and four months of his stewardship, confirming that his magnanity to staff has been awesome and unprecedented.

Adedeji accepted the cheers by saluting the jubilant crowd, waving his hands to show his gratitude.

 

Sikiru Akinola,
Technical Assistant (Print Media).

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