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An oil pipeline spews oil after a leak in Nigeria's oil state of Bayelsa November 26, 2012. Thousands of people in Nigeria engage in a practice known locally as 'oil bunkering'—hacking into pipelines to steal crude then refining it or selling it abroad. Akintunde Akinleye/Reuters

Ralph Bunche Senior Fellow for Africa Policy Studies

On Wednesday in Abuja, the group managing director of the Nigerian National Petroleum Corporation (NNPC) stated that in 2016, pipeline vandalism resulted in roughly 700,000 barrels per day (bpd) being “deferred.” Accordingly, production was 1.3 million bpd rather than the projected 2.2 million bpd, costing the country about $13.3 billion in revenue (at an average price of $52 per barrel). While Nigerian statistics can be problematic, those used by the managing director are likely to be the best available. Oil provides more than 70 percent of the revenue of Nigeria’s government at all levels (this figure has been as high as 90 percent in the past), and more than 90 percent of its foreign exchange. At a time when international oil prices were relatively low and the country was in recession, the fall in oil production due to pipeline vandalism is especially serious.

The “deferred” 700,000 bpd could not be brought to market; much or most of it remained in the ground or in storage facilities. However, some pipelines are breeched in order to steal the oil. Breeched pipelines inevitably result in oil spills, further polluting the environment and damaging the livelihoods of people nearby. Further, Nigerian oil is sweet and light, requiring little refining to produce gasoline, so that illegal mom-and-pop shops can refine the stolen oil into a usable product. Stolen oil is also sold on the international market. There has long been suspicion that political and military personalities have been involved in oil theft. However, the managing director appeared to be discussing pipeline vandalism only, not the larger issue of oil theft. 

Oil theft and pipeline vandalism is an old song in the Niger delta, where there is usually political and social unrest. The NNPC managing director outlined a proposed response to the current situation that includes technical steps (such as burying the pipelines deeper into the ground), stricter law enforcement, but also addressing the political and social drivers of Delta unrest. The latter in particular is a tall order, which no previous government has been able to fill except for relatively short periods of time. Many ‘solutions’ amount to buying off militants that would otherwise steal oil or damage infrastructure. A long term solution to oil theft and pipeline vandalism clearly requires both technological innovation and better law enforcement, but, above all, it must address the deep-seated popular grievances of the region.   

An oil pipeline spews oil after a leak in Nigeria's oil state of Bayelsa November 26, 2012. Thousands of people in Nigeria engage in a practice known locally as 'oil bunkering'—hacking into pipelines to steal crude then refining it or selling it abroad. Akintunde Akinleye/Reuters

Ralph Bunche Senior Fellow for Africa Policy Studies

On Wednesday in Abuja, the group managing director of the Nigerian National Petroleum Corporation (NNPC) stated that in 2016, pipeline vandalism resulted in roughly 700,000 barrels per day (bpd) being “deferred.” Accordingly, production was 1.3 million bpd rather than the projected 2.2 million bpd, costing the country about $13.3 billion in revenue (at an average price of $52 per barrel). While Nigerian statistics can be problematic, those used by the managing director are likely to be the best available. Oil provides more than 70 percent of the revenue of Nigeria’s government at all levels (this figure has been as high as 90 percent in the past), and more than 90 percent of its foreign exchange. At a time when international oil prices were relatively low and the country was in recession, the fall in oil production due to pipeline vandalism is especially serious.

The “deferred” 700,000 bpd could not be brought to market; much or most of it remained in the ground or in storage facilities. However, some pipelines are breeched in order to steal the oil. Breeched pipelines inevitably result in oil spills, further polluting the environment and damaging the livelihoods of people nearby. Further, Nigerian oil is sweet and light, requiring little refining to produce gasoline, so that illegal mom-and-pop shops can refine the stolen oil into a usable product. Stolen oil is also sold on the international market. There has long been suspicion that political and military personalities have been involved in oil theft. However, the managing director appeared to be discussing pipeline vandalism only, not the larger issue of oil theft. 

Oil theft and pipeline vandalism is an old song in the Niger delta, where there is usually political and social unrest. The NNPC managing director outlined a proposed response to the current situation that includes technical steps (such as burying the pipelines deeper into the ground), stricter law enforcement, but also addressing the political and social drivers of Delta unrest. The latter in particular is a tall order, which no previous government has been able to fill except for relatively short periods of time. Many ‘solutions’ amount to buying off militants that would otherwise steal oil or damage infrastructure. A long term solution to oil theft and pipeline vandalism clearly requires both technological innovation and better law enforcement, but, above all, it must address the deep-seated popular grievances of the region.   

The current state of Nigeria’s tertiary education sector has been a serious concern to many stakeholders in the country; but the managing director, Online Dynamics, Mr Wale Michael, in this interview with KEHINDE ADIO, says Nigerian students can take advantage of several opportunities overseas. Excerpt:

HOW would you assess the state of tertiary institutions in Nigeria today?

It’s not good enough. Education in Nigeria, just like any other sector in the country, is still struggling to survive. It is a known fact that incessant strikes by the various university unions have become a common phenomenon in the education sector without any lasting solution in sight yet. A student who stays at home for   five months doing nothing, what do you expect from such a student? There is a lot to be done in the sector. Having said that, it is not as if efforts have not been put in place to reengineer or resuscitate Nigerian educational system, but we are still very far from international educational standard.

Can you compare the situation here with what obtains in other countries?

Nigeria is not on the same page with other foreign countries as far as education development is concerned. For instance, a recent development in the tertiary admission process in Nigeria took many people aback when government’s admission pass mark was put at 30 per cent. Why? What will be the end products of these students after graduation? If a student with 30 per cent score is given an admission into an institution, what it means is that he or she has passed the examination. So, 30 per cent represents our pass mark. It means that these students will have the impression that 30 per cent is the bench mark for academic success. Then students will pass out as 30 per cent graduates, which is below average. Government, education policy makers and allied education agencies will have to review our education standard.

When you look at other countries like Canada, Ukraine or even South Africa, things are different over there. For instance, Ukraine is regarded as the best country for medical training. Education in all those countries is practical-based. Do you know that Nigerian university graduates cannot stand with graduates of high school in those advanced countries in the labour market? Education must translate to productivity. Education must affect the market place. If researches and findings in the Nigerian universities remain on the library shelves, education has not served its purposes and growth and development in Nigeria will remain elusive.

On this note, it is advisable for Nigerian students to consider foreign universities as alternatives to get better education for our nation building.

Is there any way your office can assist Nigerian students to have access to these foreign universities?

Yes. We have been doing that for not less than 10 years through our Visa process initiative education to study in USA, Canada, Ukraine, Cyprus, Malaysia, Bellarus, Georgia and South Africa for undergraduate and postgraduate programmes. The process is ongoing. On-Line Dynamics will give Nigerian students information on scholarship opportunities and best foreign fee-avoidable universities across the globe.

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LAGOS, Sept 14 (Reuters) - Nigeria should see a bumper cocoa harvest in the coming season as late rains have helped boost pod production, the head of the cocoa association said on Thursday.

Sayina Riman, president of the Cocoa Association of Nigeria (CAN), expects output for the new season which starts in October to hit between 300,000 tonnes and 320,000 tonnes, up sharply from the season just ended which was blighted by poor weather.

The cocoa season in Nigeria, the world’s fourth biggest producer, runs from October to September, with an October-to-February main crop and a smaller light or mid-crop that begins in April or May and runs through September.

The 2016/17 season started at a slow pace after drought cut the mid-crop harvest by 40 percent. Output for that season was estimated to reach 260,000 tonnes, Riman said, lower than a revised forecast of 280,000 tonnes and down from 340,000 tonnes forecast at the start of the season.

“We have late rains which has affected production. We are hoping that from the first week of October, we should be talking of increased yield,” Riman told Reuters.

The International Cocoa Organization (ICCO), however, gives much lower estimates of Nigerian cocoa output. It forecast last season’s production at 220,000 tonnes.

Riman did not give a reason for the discrepancy. Nigerian government production figures are also significantly higher than ICCO estimates.

“We are looking at new plantations ... rehabilitation of old farms, the level of youth coming into farming and the recovery rate of abandoned farms,” he said by phone.

Farmers across Nigeria’s main growing regions were optimistic as some had used the drought to prepare their farms, Riman said, but some have been stuck with about two-thirds of their produce due to the glut in the world market.

World cocoa prices have declined by a third in the last year amid a global supply glut after record production from top growers Ivory Coast and Ghana. ICCO predicts a global surplus of 371,000 tonnes for 2016/17.

Demand for the London September contract has been dampened by the prospect of receiving cocoa from Nigeria and Cameroon where buyers have less control over the quality of beans.

Cocoa trees need a delicate balance of rainy and dry weather. Too little rain and they wither; too much and they become susceptible to insects or fungal black pod disease. Beans can also go mouldy if small farmers are unable to dry them outside.

One farmer in the southeast region said prices dropped from a high of 1.2 million naira ($3,922) earlier this year to 400,000 naira within a six-month period.

Riman says the West African country needed to develop its local markets. “All of us in producing countries have realised that you need local consumption to make cocoa farming sustainable.” ($1 = 306.00 naira) (Editing by Susan Fenton)

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The Anti-graft Agency, EFCC, on Wednesday, confirmed that plans were in place to extradite former Petroleum Minister, Diezani Alison-Madueke.

The Anti-graft Agency, EFCC, on Wednesday, confirmed that plans were in place to extradite former Petroleum Minister, Diezani Alison-Madueke.

Several Nigerians have called for her extradition from the UK after different corruption allegations were leveled against her.
Properties worth billions of Naira linked to her have since been forfeited to the federal government, many permanently.

Speaking on Wednesday while addressing journalists, civic groups, and others, the EFCC acting chairman, Ibrahim Magu, confirmed the moves to extradite Mrs. Alison-Madueke.
“I want you to know that nobody will go unpunished. We are even seeking to extradite Diezani, but investigations are still ongoing,” Mr. Magu said.

“We have reached a level where nobody can stop us in the fight against corruption, but we all must realize that we are all stakeholders, and this fight is for the future generation.”

He added that all Nigerians must play their roles, “because EFCC can only do its best; but we must support the agency, and the law should take its course, policies should be strengthened, and punishment must be meted out in good time.”

Mr. Magu also blamed recent separatist agitations in Nigeria on corruption.

“Every evil that is happening now is caused by corruption: agitations, strikes, whatever. Corruption has chased our good human resources out of the country. It is the duty of this generation to correct the evils caused by corruption.”

The anti-graft chief also spoke on corruption among members of his organization.

“I want you to tell us if there is corruption in the EFCC,” he said. “It makes no sense if people are fighting corruption and they are corrupt. So tell us, don’t keep quiet.”

LONDON, Sept 14 (Reuters) - Activity was muted on Thursday with cargoes lingering after being on offer for some two weeks, with levels falling for Nigerian grades.

ANGOLA

* About eight cargoes were still available from the October schedule, one trader said.

* Total was still showing Girassol and Nemba. Chevron was also still offering a cargo of Cabinda.

* Unipec offered a cargo of Pazflor at dated Brent plus 45 cents and a cargo of Sangos at dated Brent plus 35 cents a barrel.

NIGERIA

* About 20 October-loading cargoes were still available.

* Unipec offered a cargo of Okwori along with Ghanaian Jubilee and Congolese Djeno.

* Offers for Forcados have sunk from close to dated Brent plus $2 a barrel to just above dated Brent plus $1 a barrel, one potential buyer said.

TENDERS

* Indian refiner BPCL is looking for West African grades in a tender it is running this week. The tender closes on Friday. (Reporting by Julia Payne; editing by David Clarke) ))

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Nigeria has started a $41 billion railway expansion to reduce dependence on oil and diversify its struggling economy by improving transport links to allow the movement of goods around the country and to ports.

“The plan we have now will go to every nook and corner,” Transport Minister Rotimi Amaechi, 52, said in an interview in the capital, Abuja.

Africa’s biggest oil producer is going through its worst economic slump in 25 years following a plunge in the price and output of crude, which accounts for more than 90 percent of foreign income and two-thirds of government revenue. President Muhammadu Buhari’s Economic Recovery and Growth Plan, presented in March, seeks to boost agriculture and manufacturing by developing the country’s transport network and power infrastructure.

Key projects include building a second railway line connecting the nation’s two biggest cities, the commercial capital, Lagos, and Kano in the north. The 1,100-kilometer (680-mile) line will carry freight and passengers. The government also wants to construct a coastal railway that connects Lagos to the eastern city of Calabar.

The two new railways are expected to cost $20 billion, with most of the funding coming from the Export–Import Bank of China, which has so far released $5.9 billion. China’s Civil Engineering and Construction Co. is building the project and both railways should be ready by the end of 2019, Amaechi said in an interview last week.

General Electric Co. is leading a group that’s rehabilitating Nigeria’s 3,505 kilometers of century-old, narrow-gauge railways linking the coastal cities of Port Harcourt and Lagos with the north. The group, includingSinoHydro of China, South Africa’s Transnet SOC Ltd. and the Netherlands’ APM Terminals BV will fund, revamp and operate the railways for a period to be decided in negotiations with the government, the minister said. They won the concession in May.

The group plans to invest $2.2 billion, Sabiu Zakari, permanent secretary in the Transport Ministry, said at the time. Nigeria will then have two links between Lagos and Kano, with the new Chinese-built one allowing trains to travel twice as fast as they can on the existing link.

The West African nation is opening up its rail system to private investors following decades of government control. Years of neglect while the nation was in political flux during military rule cut freight-rail capacity to 15,000 metric tons a year in 2005, from 3 million tons four decades earlier, according to the Transport Ministry. Most goods are now transported on worn-out and congested roads. By comparison, Transnet has the capacity to move more than 70 million tons of coal to one South African port annually.

“The rail in Nigeria was neglected for too long,” said Oke Maduegbuna, managing partner at transportation and logistics consultancy Pete, Moss & Sam Ltd. “There’s a new awareness among government officials of the economic benefits of a good rail network,” the Abuja-based expert said by phone, adding that the new projects would succeed only if there is consistency in their planning and execution.

Another $16 billion will be invested in additional rail routes to link up all the country’s state capitals and extend across the northern border into neighboring Niger’s southern city of Maradi, according to the Transport Ministry. Amaechi said it was too early to share a timeline or funding details as the government is still talking to investors for this public-private project.

The government is also trying to complete a $3 billion line from Abuja to the southern oil hub of Warri by 2018, the minister said.

With rail links to the existing and planned deep-sea ports, Nigeria hopes to substantially reduce logistics costs and facilitate exports and imports. The GE concession will provide rail infrastructure that will decongest roads and improve cargo traffic, Nigerian Ports Authority Managing Director Hadiza Bala Usman said in an interview last month.

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The foreign exchange daily turnover declined by 20.58 percent to $93.21 million on Wednesday from $117.36 million recorded on Monday at the investors and exporters window.

The data obtained from FMDQ show that naira gained N2.68k to close at N359.69k per dollar compared to N362.37k traded the previous day at the window.

Naira also strengthened at the Nigerian Autonomous Foreign Exchange Fixing (NAFEX), and the Nigerian Foreign Exchange Fixing (NIFEX), gaining N1.33k and N0.38k respectively. It closed at N362.33k on Tuesday from N363.66k on Monday at the NAFEX, while it closed at N326.37k per dollar on Tuesday from N362.75k per dollar on Monday at the NiFEX window.

At the Central Bank of Nigeria (CBN) official market, the local currency remained stable closing at the rate of N305.65k per dollar, data from FMDQ revealed.

However, naira closed at N367 per US dollar which show a depreciation in value compared to between N362.50k and N363 per dollar traded in the previous week at the black market.

HOPE MOSES-ASHIKE

BY Alasdair Pal

LONDON (Reuters) - Global stocks fell on Thursday as investors trimmed their exposure to riskier assets after central bank minutes revealed a wary take on the economic outlook from ratesetters on both sides of the Atlantic.

The European Central Bank expressed caution about removing monetary stimulus too soon following a recent bounce in the euro, the record of its last meeting showed - hitting the single currency along with the region's equity markets.

U.S. shares were set to follow suit, extending losses a day after a similarly downbeat message in minutes from the Federal Reserve, where some policymakers cautioned against rate rises while U.S. inflation remained weak.

As money market futures FFF8 cut their expectations of a U.S. rate hike by December to 40 percent from just under 50 percent before the Fed's minutes, futures for the blue-chip S&P 500 ESc1 shed 0.2 percent in pre-market trade.

The NASDAQ index was set to open 0.4 percent lower after technology giant Cisco (CSCO.O) reported weak results after Wednesday's close.

In Europe, the broad Stoxx 600 index was down 0.1 percent, snapping a three-day winning streak.

The UK's FTSE 100 .FTSE fell 0.4 percent, Germany's DAX .GDAXI 0.1 percent and France's CAC 40 .FCHI 0.2 percent.

U.S. President Donald Trump's decision on Wednesday to disband two business councils after a number of its members quit in protest over his comments about white nationalists also continued to weigh on stock valuations.

"Trump dissolving his major business groups makes the investment community even more pessimistic because this sets the stage for even more failure for him," said Naeem Aslam, chief market analyst at Think Markets in London.

The dollar erased much of its overnight losses, however.

It jumped 0.4 percent against a trade-weighted basket of other currencies .DXY and 0.8 percent against the euro, which hit a three-week low following news of the concern about its gains from within the ECB.

"The euro has shot down as a result. It is a good question of how much further we will go. The reality is the ECB is definitely more concerned than the market gave it credit for," said Simon Derrick, chief market analyst with Bank of New York Mellon in London.

"I think it is entirely possible you could see further downward pressure on the euro."

In commodities, palladium hit a 16-year high, tracking a rally in other base metals.

London copper, aluminum and zinc were just off multi-year highs on expectation that a reform of the metals industry in China will curb supply against a backdrop of robust demand.

Oil prices were steady after U.S. data showed a fall in crude stockpiles but also an increase in production, taking crude output to its highest in more than two years.

For Reuters Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets

Reporting by Alasdair Pal, additional reporting by Patrick Graham in London; editing by John Stonestreet

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The value of assets under management (AUM) in the Nigerian mutual funds industry hit all-time high as it surged to N322.99 billion as at week-ended July 21 2017, latest data from the Securities and Exchange Commission (SEC) has shown.

The SEC data showed that AUM value rose 11.03 per cent from May 26 2017. Industry stakeholders say that the increase is caused by the increased interest of investors who have been flocking towards Nigerian mutual funds recently.

Analysts hinge the resurgent interest on such factors as the current state of the Nigerian economy, stock market and interest rate fluctuations as well as much improved mutual funds offerings.

This assertion is further backed by a recent report by Quantitative Financial Analytics which estimated that Nigerian mutual funds attracted the sum of N42 billion inflows in the first quarter of 2017 compared to the N49 billion inflows recorded in the entire 2016 fiscal year.

Mutual funds’ assets in Nigeria also grew to N318 billion as at the beginning of the first half of 2017, 42 per cent spike since the beginning of the year. AUM stood at N223.6 billion as at the end of 2016.

It is against this background the Coronation Asset Management Limited (CAM) recently launched its two mutual funds with a view to leveraging its capacity and experience to help investors realise better returns and minimise risks of their investments.

“No one can doubt the capacity and expertise of Coronation Asset Management to deliver competitive returns to investors in the Coronation Mutual Funds,” said Emeka Okolo, senior fund manager and head of Coronation Asset Management at the launch of one of the funds. “The level of professionalism and quality of investments will be difficult to match by other mutual fund managers in Nigeria and the West African sub-region. This, coupled with the proposed investment mix and the fund structures, distinguish these Mutual Funds.”

Okolo noted that active portfolio management by experienced professionals offer investors better prospects on their investments especially in periods of market volatility and economic downturns as is being experienced in Nigeria, making mutual funds an optimal choice.

He said that the recently launched Naira-denominated, open-ended mutual funds by CAM, which witnessed a high subscription rate by individuals, retail and institutional investors, has continued to elicit excitement.

The Mutual Funds, which include the N1.5 billion money market fund, the N400 million fixed income fund, and the N200 million balanced fund, were all offered at par of 1 Naira each.

Tunde Folawiyo, chairman of Coronation Merchant Bank, said that the funds offer all strata of investors, individual and corporate alike, an opportunity to diversify their investment portfolios backed by the strength of the Coronation brand and managed by a team of experienced professionals at CAM.

The money market fund and the fixed income fund have been rated “A- (NG)(f)”  and “AA-/FV4 (NG)(f)”by Agusto & Co, a foremost Nigerian rating agency. The ratings indicate low to medium risk characteristics of the funds.

The initial public offering (IPO) for the funds came on the back of a strong financial year for the premium financial institution.

Coronation Merchant Bank, the parent company of CVAM, had grown its profits by 128 per cent from December 2015 to December 2016. The Group’s financial strength, sound risk management, prudent investment strategies, tradition of excellent value delivery to all stakeholders, attracted investors to the IPO for the mutual funds.

The Coronation mutual funds are being overseen by institutions with strong track records of providing superior financial services. CAM acting is the Fund Manager, Citibank Nigeria is custodian, and United Securities Limited is registrar to all three funds.

Stanbic IBTC Trustees Limited will acts as Trustee to the Balance and Fixed Income Funds while United Capital Trustees will act as Trustee to the Money Market Fund.

INNOCENT UNAH