Standard and Poor’s (S&P) Global Commodities Insights analysts have projected a delay in the commencement of petrol supply from the Dangote refinery, suggesting a start date in the fourth quarter of 2024 rather than the May timeline stated by the company.

This revelation, made during an S&P podcast discussing West Africa’s oil product flows, stems from the instability in the Nigerian oil sector.

During the podcast titled “Exploring West Africa’s oil product flows in a changing refining landscape,” Kelly Norways, an African energy expert at S&P, discussed the anticipated impact of the Dangote refinery on energy imports in West Africa. Norways noted the refinery’s potential to substantially reduce energy imports, particularly petrol, estimating a supply of up to 290,000 barrels daily between 2024 and 2026.

However, Norways tempered expectations by stating that despite signs of activity at the refinery, the timeline for gasoline production remains uncertain.

“We are starting to see signs of activities, but all eyes are on when we’ll start to see gasoline production will commence from that project. There is a significant amount of pressure from the Nigerian government for significant volume of that supply to be sent to the domestic market,” she said.

While Dangote had expressed intentions to produce gasoline by May, S&P analysts anticipate a more realistic timeline for the fourth quarter of 2024.

“In reality, when we see that start scale up is still subject to debate. Dangote has recently been espousing some punchy timelines. They have most recently been saying that they are looking to produce gasoline by May. But in reality, our analyst expect that would be something like the fourth quarter of this year in a more realistic timeline,” she added.

The discussion also addressed shifts in petroleum product flows into West Africa, noting a reduction in supply from traditional suppliers such as the Netherlands’ Amsterdam and Rotterdam refineries. This decline is attributed to quality improvements and new regulations implemented since 2022, reflecting broader changes in the global refining landscape.

The Dangote refinery, officially commissioned in May 2023, has faced challenges operating at full capacity due to a series of delays. Despite setting a production projection for October, the 650,000 barrels per day oil plant missed its target, marking the second time in 2023 it raised hopes of ending petrol importation in Africa, particularly Nigeria.

Although it began receiving crude oil around December, production did not commence until March, when diesel distribution to local marketers commenced.

The refinery’s inability to start production stems from insufficient crude oil supply from the Nigerian National Petroleum Company Limited (NNPCL), a reflection of the broader dwindling oil production in Nigeria.

In response, Dangote Refinery has adopted an innovative approach, sourcing one-third of its oil from the United States to address domestic supply challenges and enhance operational efficiency.

Energy experts said that while the refinery holds promise for reducing energy imports and boosting regional energy security, operational hurdles must be addressed to realize its full potential.

In a move towards cleaner energy and affordable transportation, Bayo Onanuga, the Special Adviser to the President on Information and Strategy, has announced that the federal government is set to inaugurate the first set of compressed natural gas (CNG) vehicles ahead of the Tinubu administration’s first anniversary on May 29.

Speaking from Abuja, Onanuga disclosed the Federal Government’s allocation of N100 billion from the N500 billion palliative budget towards the acquisition of 5,500 CNG vehicles, including buses and tricycles. Additionally, the allocation encompasses 100 electric buses and over 20,000 CNG conversion kits, with provisions for the expansion of CNG refilling and electric charging stations.

Under the stewardship of an expert committee led by Michael Oluwagbemi in the oil and gas sector, this initiative seeks to fulfill President Tinubu’s commitment to transitioning towards cleaner energy and environmentally friendly transportation alternatives.

Onanuga noted the substantial response from the private sector, with over $50 million invested in refueling stations, conversion centers, and mother stations.

He said in a statement: “After months of detailed planning and background work, the committee driving the initiative is set to deliver on President Tinubu’s vision and promise.

“Already, the committee, being led by Michael Oluwagbemi, an oil and gas expert, has delivered some major foundational reforms to enable the new CNG and Electric Vehicles future the President promised.

“All is now ready for delivery of the first set of critical assets for deployment and launch of the CNG initiative ahead of the first anniversary of the Tinubu administration on May 29.

“The private sector has responded with over $50 million in actual investments in refuelling stations, conversion centres, and mother stations.”

This collaboration between the government and private enterprises underlines the collective effort to promote the adoption of CNG vehicles and infrastructure.

The rollout of CNG buses and tricycles, coupled with the ambition to have at least one million natural gas vehicles on Nigerian roads by 2027, signifies a pivotal shift towards cleaner energy within the transportation sector. With potential emissions reductions of more than 40%, CNG vehicles align with Nigeria’s obligations under the Paris Climate Accord and contribute to global efforts to combat climate change.

CNG is said to be a more environmentally friendly fuel compared to other fuels. It produces up to 95% fewer harmful emissions or greenhouse gases, such as carbon dioxide, carbon monoxide, and nitrous oxide. For example, CNG emits 44% less carbon monoxide compared to the 80% emitted by burning petrol.

Drawing inspiration from other nations such as India, China, and Brazil, which have successfully deployed large fleets of natural gas-powered vehicles, Nigeria aims to reduce pollution and dependence on liquid petroleum products through the adoption of CNG technology.

The Presidential CNG Initiative, inaugurated in October 2023 following the removal of fuel subsidies, prioritizes the provision of more affordable, safer, and environmentally friendly energy solutions, particularly for mass transit. As the first set of CNG vehicles prepares for launch, Nigeria takes a significant stride toward realizing this vision.

Supported by substantial government funding and private sector investment, Nigeria hopes to achieve cleaner air, reduced emissions, and enhanced energy security as it embraces CNG vehicles as a key component of its transportation strategy.

CNG has a narrow range of flammability that varies from 5-15%. Due to its low flammability property, it lowers the chances of catching fire. However, a CNG car can easily reach its ignition temperature of 540 degrees Celsius while being used and can catch fire, raising concerns among Nigerian commuters about its safety.

Unilever Nigeria Plc has reported a significant foreign exchange revaluation gain of N1.17 billion in the first quarter of 2024, as per its unaudited financial results published on the NGX.

This marks a notable turnaround from the corresponding period in 2023 when the company recorded a foreign exchange revaluation loss of N458.29 million. The contrasting results reflect the volatility witnessed in the Nigerian foreign exchange market, with the naira depreciating by 184.34% over one year.

The depreciation of the naira, from N460.35/$1 in Q1 2023 to N1309/$1 as of March 31, 2024, has had profound implications for companies operating in Nigeria, including Unilever. The unification of the foreign exchange market by the Central Bank of Nigeria (CBN) in June 2023, coupled with subsequent devaluations, resulted in significant foreign exchange losses for firms with exposure to foreign currency-denominated loans.

Despite the challenges posed by naira volatility, Unilever Nigeria reported revenue of N32.31 billion in Q1 2024, accompanied by a profit-before-tax of N4.35 billion. While this represents a marginal decline from the previous year’s figure of N4.49 billion, the company’s prudent management is evident in its ability to navigate the turbulent economic environment.

Unilever’s reversal of foreign exchange revaluation losses in Q1 2024 has been noted as a positive indication amidst broader economic challenges. The company’s proactive measures and resilience are said to be underscored by its ability to mitigate the impact of currency fluctuations and sustain profitability.

Additionally, the increase in profit after tax to N3.35 billion, compared to N2.67 billion in the same period of 2023, reflects Unilever’s commitment to delivering value to its shareholders amidst evolving market conditions.

Access Holdings Receives Shareholders’ Approval to Raise $1.5 Billion for Recapitalization.

Meanwhile, Access Holdings has obtained shareholders’ consent to raise $1.5 billion from local and international capital markets as part of its recapitalization strategy.

The decision was made during the company’s annual general meeting (AGM) held in Lagos on April 19. This move aligns with the Central Bank of Nigeria’s (CBN) recent announcement of increased minimum capital requirements for financial institutions, prompting Access Holdings to bolster its capital base to meet regulatory standards.

Access Holdings plans to raise the capital through various methods, including public offerings, private placements, rights issues, and book-building processes. The company aims to issue ordinary shares, preference shares, alternative tier one, convertible and/or non-convertible notes, bonds, or other instruments to bolster its financial position.

At the AGM, shareholders voted in favor of increasing the company’s issued share capital from N17,772,612,811.00 to N26,658,919,216.50 ordinary shares. This decision reflects their support for Access Holdings’ recapitalization efforts in response to the regulatory requirements set forth by the CBN.

The CBN’s announcement on March 28 mandated financial institutions to enhance their minimum capital requirements within 24 months.

Commercial banks with international licenses are now required to maintain a capital base of N500 billion, while national and regional financial institutions must have capital bases of N200 billion and N50 billion, respectively.

The regulatory adjustment aims to bolster banks’ resilience, solvency, and capacity to support Nigeria’s economic growth amidst prevailing macroeconomic challenges and external shocks.