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Foreign Investors’ Sell-Off Bond Holding Raises Price

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Mild bargain hunting activities by investors triggered an increase in bond prices while yields nose-dived. There was increased demand for long-term instruments maturing between  10 to 20 years despite the liquidity tightness in the money market.

Market watchers have attributed the rise in the price of bond during the week which ended June 15, 2012 to the fact that there was slow down in the sell-off of bond holdings by foreign investors.

In  specific terms, the 20-years,  10.00 percent FGN bond maturing in July 2030 rose by N0.11 with its yield moderating to 14.43 per cent even as the 10-year, 7.00 per cent FGN bond with a mature date of October 21019 adding N0.11 while yield dropped to 0.11 per cent.

Also, the 7-year, 9.25 per cent FGN debt paper which is to mature in September 2014 appreciated by N0.09 even as yield softened to 15.62 percent while the 3-year, 10.50 percent FGN bond maturing March 2014 gained N0.05 just as yield dropped to 15.63 per cent.

On the flip side, the 5-year, 4.00 per cent FGN bond with a maturing day of April 2015 finished flat during the review week.

In all, the over-the-counter (OTC) bond recorded a turnover of 93.02 million units of FGN bond worth N81.05 billion executed in 764 deals in the week under review as against the 118.96 million units of FGN bonds exchanged by investors in 823 trades at the value of N112.15 billion.

The equities market of the Nigerian Stock Exchange (NSE) surged by 1.35 per cent as the market indicators finished in the green territory during the week.

The NSE All Share Index having opened the week at 20,902.95 basis points added 135  points to finish at 21,184.58 basis points increasing the year-to-date performance to 2.19 per cent according to market watchers.

Also the market capitalisation of listed equities boosted by the supplementary listing of rights issues totalling 1,149,611,749 units of International Breweries Plc rose from N6.67 trillion recorded the previous week to N6.76 trillion.

Two of the sectorial  indices tilted upwards  as the NSE 30 index surged by 1.25 per cent to close at 964.14 basis points while the NSE consumer goods Index rose by 0.05 per cent to finish at 1,699.99 basis points.

On the downside, the NSE Banking index dipped by 0.83 per cent to close at 298.43 basis points even as the NSE Insurance Index dropped by 2.45 per cent to close at 118.82 points while the  NSE Oil/Gas depreciated by 4.97 per cent to close at 178.04 points.

The market recorded a total volume of 2.76 billion units of shares valued at N7.99 billion in 16,961 deals last week up from a total of 1.14 billion units of shares at the cost of N8.86 billion exchanged by investors in 18,880 deals in the previous week.

In volume terms, the financial services sector of the equities market was the most active with a recorded volume of 2.36 billion units of shares worth N4.88 billion exchanged in 9,625 trades. The conglomerates sector followed with a turnover volume of 211.72 million units of shares valued at N466.05 million in 1,004 deals.

 

Vivian-Peace Nwinaene

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FG To Eradicate Multiple Taxation In Mining Sector – Adegbite

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The Minister of Mines and Steel Development, Mr Olamilekan Adegbite, says the Federal Government is setting in place various measures to eradicate multiple taxation for miners.
At the flagship Forum last Tuesday in Abuja, Adegbite said the ministry was engaging with the three tiers of government to resolve this issue.
He said that this informed the recent webinars and advocacy engagements by the ministry with all stakeholders in the country involved in the mining industry.
He said that though the constitution vested control of mineral resources in Nigeria in the Federal Government, the fund goes into the Federation Account, of which everybody participates.
He added that all the 774 local governments got money from that account but if they cut corners by disturbing the miners with unnecessary local taxes they get discouraged.
“So, it is double jeopardy when you go and do all these illegal taxes, or you go and disturb the miners, when you will benefit from what is derived in your place, you get a 13 per cent derivation.
“You also get your share of the federal accounts as of course laid down statutorily. So, it is a continuous process, we educate everybody and I think we are getting good results.”
The minister said there was a Mineral Resource Committee (MIRENCO) in every state and the chairman was nominated by the governor of that state, so that he would be in the know about everything going on about mining in that state.
He said that the chairman of that committee was to oversee all the activities between the miners, the community, the state government and the Federal Government.
“So, on that committee, the Federal Government has representatives, the local government has representatives, the governor chooses the chairman and then Ministry of Environment and other stakeholders bring in representatives as well.
“So, through this committee, everybody can participate, and make sure that we work in harmony, bake a bigger pie so everybody can share.
“So, it is continuous advocacy, we let them know what we are doing and of course they can also participate, where they do not understand or where the governor has any problem he can always ask the chairman.”
On the issue of rock blasting, he said cities had expanded to meet quarries.
According to him, quarrying is a necessity, because stones are needed to make concrete when building roads and houses.

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Nigeria Lost N53.26bn To Gas Flaring In Two Months – NNPC

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Nigeria lost an estimated N53.26billion in the first two months of this year as international oil companies and local players flared a total of 33.04 billion standard cubic feet of natural gas.
The oil companies wasted 17.53 billion scf of gas in February, compared to 15.51 billion scf in January, according to data obtained from the Nigerian National Petroleum Corporation.
With the price of natural gas put at $3.93 per 1,000scf as of Wednesday, the 33.04 billion scf flared translates to an estimated loss of $129.85million or N53.26billion (using the official exchange rate of N410.13/dollar).
The NNPC, in its latest monthly report, said out of the 206.05 billion scf produced in February, a total of 133.06 billion scf was commercialised, consisting of 40.15 billion scf and 92.91 billion scf for the domestic and export market respectively.
It said this implied that 64.48 per cent of the average daily gas produced was commercialised while the balance of 35.52 per cent was re-injected, used as upstream fuel gas or flared.
Gas flare rate was 7.67 per cent in February (i.e. 565.52 million standard cubic feet per day), compared to 7.73 per cent in January (i.e. 554.01 million scfd).
In January, a total of 223.55 billion scf of natural gas was produced, translating to an average daily production of 7,220.22 million scfd.
Out of the total gas output in January, a total of 149.24 billion scf was commercialised, consisting of 44.29 billion scf and 104.95 billion scf for the domestic and export markets respectively.
Firms producing less than 10,000 barrels of oil per day will pay a gas flare penalty of $0.5 per 1,000 scf.
The penalties paid by oil and gas companies for flaring gas in the country will be invested to build midstream gas infrastructure in host communities, according to a new provision introduced into the Petroleum Industry Bill by the National Assembly.
“Moneys received from gas flaring penalties by the commission (Nigerian Upstream Regulatory Commission) pursuant to this subsection, shall be transferred to the Midstream Gas Infrastructure Fund for investment in midstream gas infrastructure within the host communities of the settlor on which the penalties are levied,” the Senate and House of Representatives said in subsection (4) of section 104 of the bill.

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Nigeria To Boost Trade Volume Through ECOWAS TPOs

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Nigeria is poised to boost its non-oil exports following the official launch of the Economic Community of West African States (ECOWAS) Trade Promotion Organisations (PTOs).
With Executive Director /CEO of the Nigerian Export Promotion Council (NEPC) Segun Awolowo, as the inaugural president of the ECOWAS TPOs, the NEPC is repositioning the nation’s export through the implementation of its N50 billion Export Expansion Facility Programme (EEFP), a part of the Economic Sustainability Plan whose development and implementation is being led by the Vice President.
EEFP is expected to significantly raise the volume of non-oil exports in Nigeria, and it’s a spin-off of the Zero Oil Plan developed by Awolowo and approved by the President.
Besides providing financial support for the average Nigerian exporter, EEFP is also going to see the establishment of top-notch warehouses close to airports where Nigerian goods meant for export would be packaged to globally competitive standards ahead of their exportation.
The EEFP, in line with the FG’sEconomic Sustainability Plan (ESP), is focused on cushioning the effects of the Covid-19 pandemic on non-oil export businesses,thereby safeguarding jobs and creating new ones.
In March, Minister of Industry,Tradeand Investment (MITI), Niyi Adebayo, officially flagged off the EEFP and launched the first online Grant Management Portal (GMP) for non-oil exports.
While the EEFP is being implemented by the NEPC, the Federal Ministry of Industry, Trade and Investment is the supervisory body over the agency and its operations.
It was learnt although the programme anticipated 500 beneficiaries, since the launch, it has received over 3,500 applications for the grant, out of which over 2,000 were verified after meeting the eligibility criteria.
Federal Government officials said further details and plans on disbursement to final successful beneficiaries are being awaited.

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