The Nation Newspaper

Category: Energy

  • Govt to disburse $150m solid minerals grants

    The Federal Government has concluded plans for the disbursement of the $150 million World Bank grant to solid mineral sector operators.

    Part of the procedures includes vetting applications from operators who applied for the grant, in line with the rules as advertised and published in national dailies.

    The procedures are to determine the eligibility of the applicants, examine their impacts on the sector and see whether their purposes for seeking the funds tally with the aspirations of the World Bank to grow economies, among others.

    Minister of Solid Minerals Development Senior Special Assistant on Media, Mr. Yinka Oyebode, said making the grant accessible for operators had reached an advanced stage, adding that the grants would be disbursed soon.

    He described operators with tangible evidence as those that have proven track records of performance in the sector, while operators at the principal mining areas were those mining strategic minerals.

    He said the government wanted operators with tangible evidence of operation as well as those working in principal mining areas to benefit from the facility.

    According to him, due process is being followed, in order to ensure that the right operators get the fund.

    Oyebode said the government was carrying out investigations to determine the eligibility of those that applied for financial or material assistance, which the World Bank provided the sector in the second quarter of this year.

    Oyebode said: “Many people may be wondering, why the grants have not been disbursed to the operators since it was issued by World Bank months ago. The answer is simple. World Bank prides itself as a reputable financial institution that meets the needs of operators in developed and developing economies by providing either grants or aids or loans to them, while at the same time ensuring that the funds were judiciously spent by the receiving nations or sectors.

    “The Federal Government, which received the grants on behalf of the operators in the solid minerals, is not ready to work at cross-purpose with the World Bank, hence the decision to provide the grants to suitable operators in the sector. That is the reason for the delay in providing the fund to the operators. But I can assure you that the government would disburse the loans to qualified operators very soon.”

    According to him, using grants or any other assistance for the purpose they are intended is the World Bank’s philosophy.

    “The global financial body has done it in critical sectors such as power, agriculture and others and it ensured that the funds were utilised. The bank will not give the money cash to the operators, who applied for it. Rather, it helps an operator or sector to get the equipment needed for his operation, as contained in the agreements, which he has signed. For instance, if an operator in the solid minerals sector needs a particular technology, what the World Bank does is that it would help the operator gets the technology, and not to give him the money. This is contrary to a situation whereby the bank would give cash to the operator in form of loan to purchase the technology,” he said.

  • Shell Nigeria Gas donates labs, ICT centre to Ogun school

    Shell Nigeria Gas donates labs, ICT centre to Ogun school

    Shell Nigeria Gas (SNG) has donated an ICT centre and well-equipped science laboratories to African Church Community Secondary School in Ewupe, a community hosting the company’s facilities in Ota, Ogun State.

    The gesture was the second phase of SNG’s intervention in the school to bring it to a competitive standard.

    Last year, the company also donated a block of five classrooms, a 12-room stand-alone toilet facility, school water system, upgraded football field, and rehabilitated five blocks of 19 classrooms for shared use by the school and the co-located Ebenezer African Church Primary School in the first phase of the intervention.

    “Our goal is to support government and other relevant agencies to close the gap of educational inequality between pupils of public schools and their counterparts in private schools,” Managing Director of SNG, Ed Ubong, said at a ceremony marking the completion and handover of the projects to Ogun State government.

    “We recognise education as the topmost need of the people of our neighboring communities and what we have done is a progression of our longstanding support to the school and to the communities,” Ubong added.

    Ogun State Commissioner for Education, Science and Technology Mrs. Modupe Mujota, who received the facilities, commended SNG’s gesture. She charged the students to take advantage of the facilities to “upscale their academic performance and competitive exploits”.

    “This singular act of Shell Nigeria Gas depicts the company’s fulfillment of its social responsibility for the development of its host communities and is worthy of emulation by others,” she said.

    The Principal, Mr. Gbolahan Adekunjo, acknowledged the improved academic standard and the growing number of enrolment in the school following the series of upgrade by SNG.

    “The interventions have resulted in an enabling environment for teaching and learning and the impact is felt by the students, staff, parents and catchment communities.”

    Community Development Association, Ewupe, Chairman Alhaji Monsuru Akande thanked SNG. He appealed to the government to create the enabling environment for SNG and other companies to support education in the state.

    SNG is owned by Shell  for the downstream distribution of gas.

    It operates a gas transmission and distribution network of approximately 115km and serves industrial customers in Ota, Ogun State and Aba in Abia State.

  • OPEC likely to extend cuts

    OPEC likely to extend cuts

    Oil prices have hovered around their highest levels of the year over the past few weeks, reaching a two-year high of $59 per barrel in late September. The bullish sentiment in the market reflects four major developments: higher global demand, the rising likelihood that OPEC will extend its production cuts until the end of 2018, the fading impact of hurricanes in the US and heightened geopolitical risks in Iraq and Iran.

    According to The Peninsula Qatar, non-OPEC output is expected to increase further in 2018 and we believe OPEC will therefore extend its production cut agreement from its expiry in Q1 2018 to the end of 2018 to support the market. As a result, we maintain our forecast for an average price of $58 per barrel for 2018.

    So, what is driving the recent bullish sentiment in oil prices? The first development is a firmer global demand outlook. In September, the International Energy Agency (IEA) raised its global oil demand forecast for the whole of 2017 due to improving growth in the US and Europe. It now projects an increase of 1.6 million barrels per day (mb/d) in 2017 compared to 1.4m b/d previously.

    The second major development has been increasing speculation of an extension of OPEC and non-OPEC production cuts beyond Q1 2018. We first highlighted that OPEC was increasingly likely to extend its production cuts back in early July (see our commentary, OPEC’s 2018 dilemma). Recently, Russia and Saudi Arabia have had high level talks discussing the possibility of an extension and Saudi Arabia has also said that it will unilaterally cut production by an additional 0.3mb/d, over and above its existing OPEC agreed cuts, beginning in November to further support prices. At the same time, although inventory levels have declined since the start of the year, they have not fallen quickly enough to achieve OPEC’s stated target of bringing inventories down to their five-year historical average by Q1 2018. All of these factors have pushed markets to expect that an extension of the agreement is increasingly likely

    The third development is the fading impact of Hurricane Harvey on the US oil market. Hurricane Harvey, which hit the oil producing Gulf Coast region of the US, paradoxically resulted in lower and not higher crude oil prices in late August. This is because the hurricane disrupted refinery output and left crude oil production largely undisturbed. The end result was an increase in crude oil inventories in the US, depressing crude prices, and rapid draw down of refined product inventories. Now, prices have rebounded as refining capacity has mostly come back online and the crude oil inventory glut is being cleared by record high US crude oil exports.

    The fourth development is heightened geopolitical risks. The Kurdish independence referendum has created some uncertainty over the future flow of 500,000 bpd from Iraqi Kurdish oil fields to Turkey.

  • Lagos to set up ceramic centre

    Lagos State Government through the Ministry of Energy and Mineral Resources is to establish a ceramic processing centre.

    Commissioner for Energy and Mineral Resources, Hon. Olawale Oluwo, who disclosed this at a meeting with representatives of Interco Energy Resources in his office at Alausa, said the ceramic centre would improve the quality of life of residents.

    He said: “The agreement has been reached between the government and Epina Technologies to carry out preliminary studies for ceramic skill acquisition with a view to establish the processing centre.” This is in line with government’s policy of promoting public private partnership within the energy sector to attract meaningful and effective investors.

    He said the geological mapping for the project would be in three phases, covering the three Senatorial Districts – Lagos East, West and Lagos Central. The quest for solid minerals within the state led to the commissioning of various studies to determine availability, quality as well as quantity of either solid, liquid or gaseous mineral.

    “Lagos, no doubt, is rich in notable mineral resources which if well harnessed will enhance revenue and consequently turn the fortune of Lagos residents around for the better,” Oluwo said.

    Oluwo also said the strong desire of the government for solid, liquid or gaseous mineral resources was the yardstick for studies commissioned by his ministry in the energy sector.

    On the new refinery citied at Lekki Free Trade Zone by Dangote, Oluwo said it would complement oil production by Yinka Folawiyo Petroleum Company.

    “Everything is pointing to the fact that the present administration of Governor Akinwunmi Ambode is leaving no stone unturned at ensuring that the state remains a tangible Centre of Excellence especially in the area of power generation and realisation of tangible revenue from solid, liquid and gaseous minerals,” he added.

  • Govt to boost DisCos’ capacity by 2,000mw

    Govt to boost DisCos’ capacity by 2,000mw

    • NERC cuts new connection timeline to 40 days

    The Federal Government is putting in place measures to increase the capacity of electricity distribution companies (DisCos) by 2,000 megawatts (mw), to improve service to consumers.

    However, there are indications that the DisCos are not comfortable with the arrangement. The Federal Government intends to make direct investments in the distribution arm of the power supply value chain through independent investors. But DisCos are demanding that the government should channel such investments through them, fearing that the plan will impinge on their operations and negatively impact returns on their investments.

    These concerns, among others, are contained in a letter dated September 27, 2017 entitled: “Federal Government of Nigeria’s Initiatives in the Electricity Sector and the Impact on Electricity Distribution Company Activities.” It was jointly signed by the DisCos and addressed to the Nigerian Electricity Regulatory Commission (NERC), with a copy sent to the Minister.

    Power, Works and Housing Minister, Babatunde Fashola, who disclosed this at the 20th monthly power sector operators’ meeting in Owerri, Imo State, said the substance of government initiatives, which prompted the letter by the DisCos, could be summarised as: provision of meters to consumers through licensing of meter suppliers; provision of more power to consumers through licensing of eligible customers; and provision of independent dedicated power to universities.

    Others include promotion of the use of solar power through mini-grids; and expansion of the distribution network of DisCos so that they can take on additional 2,000mw of power now available for supply

    He said:“We are also making promising progress in recovering debts due from international customers and you will be notified of how much has been received when the appropriate accounts confirm that they have received value for the credits we have been notified of.

    “It is against this background that I now move to the challenges, which we still have to overcome; the more pressing of which is how the DisCos can quickly increase their capacity to take power and distribute to the consumers.”

    Fashola had, at a similar meeting in Lagos, last month, said: “Today, we have more power available to go on the grid over 6000Mw because generation and transmission have improved. The capacities are above what the Discos can carry. So, they have to play catch up.”

    He commended the DisCos for the decision to channel their complaints to NERC through a jointly- signed letter. “This is a welcome departure from the previous order and it is to be encouraged,” he said, adding that without doubt, the government’s initiatives are targeted at improving service to the people. “In your letter under reference copied to me, you expressed concerns about the impact of these initiatives on your businesses,”he said.

    He continued: “It is not my understanding that you oppose them, which is commendable. It is my understanding that you fear that you will lose some income or some customers if government proceeds; and on the question of meters, you seek to have technical compatibility with what the licencee will operate.  In respect of possible investment in distribution equipment you seek that government should route the investment through the DisCos.

    “Understandably you are concerned about investment recovery and in your views, the solution is a tariff review. While your concerns about business viability, financial stability and cost recovery are well understood and indeed, supported by the Electric Power Sector Perform Act of 2005 (EPSRA), which government will respect, I must point out that government’s focus is also strong on the issue of service to the people.There must be a balance somewhere in the middle.

    “As far as the promotion of solar and other sources of independent power are concerned, please note that not only are they supported by the ESPRA, they are consistent with our Paris Climate Change Agreement Obligations and with emerging global practice. DisCos have nothing to fear about solar. It is a space in which they are entitled to play, but in which they cannot exclude others from playing.

    “The ESPRA did not contemplate a monopoly for any licensee unless it is expressly stated in the license. As for channelling investment into distribution assets through the DisCos, government has not yet taken a position on what the best way forward will be.

    “However, the government is clear that a solution must be found quickly to the inability of DisCos to take about 2000Mw of power that will imminently increase as we get more incremental power.

    “But the point that must be made is for all of us to remember that, government is a 40 per cent shareholder of the DisCos (on behalf of the Federal, State, Local Governments and workers) and therefore, has a self-benefitting interest in the wellbeing and efficiency of the DisCos.”

  • Eterna Oil secures licence for Castrol products

    Eterna Oil secures licence for Castrol products

    Eterna Plc, an indigenous oil firm, has been licensed to manufacture and distribute Castrol products in Nigeria, its Managing Director, Mahmud Tukur, has said.

    Tukur spoke at the launch of Castrol brand of products in Lagos. He said with the licence to manufacture and distribute Castrol products, Eterna Plc was duty bound to protect the intellectual property rights.

    “If you attempt to purchase or acquire Castrol products from any other source, you are taking a huge risk,” he added.

    Some of Castrol products launched into the market include, Castrol Edge – fully synthetic oil with fluid strength technology. Castrol Magnatec – semi-synthetic oil offering instant protection from the start, and Castrol GTX Essential, which is a trusted protection for your engine.

    Tukur said over the next few months, the company would roll out sales points nationwide, appoint distributors, partner independent retailers and construct its own mega stations in key cities including Abuja and Calabar. He noted that in expanding the sales points and filling stations, the management was looking at building new structures, mergers and acquisition.

    The Eterna boss said: “The Company’s journey began as far back as 1991 through the vision of the founder, Otunba Tunji Lawal Solarin, when Eterna started importing and distributing Castrol lubricants in Nigeria. A robust marketing structure was set up and with increased market sales, Eterna began to manufacture lubricants locally through a third-party facility on an interim basis.

    “The aim was always for the company to own its blending facility and this dream became a reality when Eterna secured a $940,000 loan from the International Finance Corporation (IFC) in 1995 to construct what was to eventually become one of the best and most modern lubricant manufacturing plants in Africa. Castrol designed the plant and provided the required technical support during construction ensuring that the plant met global standards.

    “Twenty years later, Eterna’s 15,000MT capacity state-of-the-art lubricant manufacturing plant, which is fully owned through its subsidiary Eterna Industries Limited, is one of the only three Castrol accredited blending plants in Africa. The plant is located in Sagamu, Ogun State on a sprawling five hectares of prime industrial real estate.

    “The Plant is equipped with a state-of-the-art laboratory, which supports the blending activities as well as use oil analysis services for customers. This is a vital technical support, which we provide to our customers to enable them optimise equipment uptime and avoid failures where possible, through early detection and diagnosis.

    “The lab frequently participates in ILCP (Inter Laboratory Correlation Programmes) exercises where it is provided with random samples to test and the results are benchmarked against many laboratories scattered all over the globe. I am pleased to report that Eterna’s laboratory has continued to retain its global rating and is currently pursuing its ISO 17025 certification.

    “The overall activities of the blending plant are supervised by Castrol’s global manufacturing and technology teams, ensuring that our members of staff are exposed to the latest manufacturing and testing methods, resulting in the highest quality manufactured lubricants.

    “I am proud to announce that the latest addition to the Castrol GTX family “Castrol GTX Essential”, was produced for the first time in the world at our plant in Sagamu this August. This is a clear demonstration of the confidence reposed in our manufacturing capabilities by Castrol. Castrol GTX Essential was developed in response to specific market requirements in Nigeria/Africa (and other regions with similar climatic conditions) and is an example of how globally developed technology is brought to bear in ways that address local conditions, meet engine manufacturers’ specifications whilst remaining affordable and cost-effective.”

    He said between 2009 and 2015 post the acquisition of Castrol by BP, Eterna was majorly active in the Marine and Energy sectors, providing premium lubricants to tanker vessels, supply vessels, port operators, FPSOs and drilling rigs.In 2015, we commenced further discussions with Castrol to extend our licencing rights to cover the Automotive and Industrial Sectors, culminating in the signing of a sole distributorship agreement in February 2017 for the automotive and industrial range of lubricants for the Nigerian market.

    “Eterna Plc is the first fully indigenous oil marketing company to be listed on the floor of the Nigeria Stock Exchange (NSE),” he added.

  • Reps, NCDMB back Shell’s Global Nigeria Forum

    Reps, NCDMB back Shell’s Global Nigeria Forum

    The House of Representatives Committee on Local Content and the Nigeria Content Develop-ment and Monitoring Board (NCDMB) have  supported the yearly Global Nigeria Forum (GNF), an initiative of Shell Nigeria Exploration and Production Company (SNEPCo), the deepwater arm of Shell companies in Nigeria.

    Leaders of the two organisations with other public and private sector players in the oil and gas industry, spoke at the fourth edition of the forum in Aberdeen, Scotland. The theme of the forum was “Enabling competitive local content through sustainable partnerships.’ They described the annual event as worthy of emulation by the country’s local content regulator.

    The forum, Shell spokesperson Bamidele Odugbesan said, is the brainchild of SNEPCo, which aims to strengthen local content in offshore exploration, by opening the opportunity space to Nigerian professionals in Europe, particularly in the United Kingdom (UK).

    NCDMB Executive Secretary Mr. Simbi Wabote, who delivered the keynote address, described the annual event as a huge success. “I am happy to see growth in a partnership that has continued to build capacity without compromising standards.”

    House Committee Chairman on Local Content, Mr. Emmanuel Ekong, who led some other members of the national assembly to the forum, proposed the takeover of the organisation of the forum by the NCDMB. According to Ekong, saddling the local content agency with the ownership of GNF will ensure ‘inclusion of other international oil companies for greater impact and access support from the Nigerian parliament’.

    Nigeria National Petroleum Corporation (NNPC), Exploration Manager,  Mr. Marcel Amu, said: “This forum is unique and germane, particularly at this time of the low oil price regime, and it aligns with the recent NNPC policy to increase participation of the private sector while attracting the right people with the right technology into the Nigerian oil and gas industry.”

    Council for the Regulation of Engineering in Nigeria (COREN) President, Mr. Kashim Ali, pledged his organisation’s continued support to the forum and asked participants to take advantage of COREN’s new accreditation procedure for Nigerian professionals outside the country.

    Reacting to the forum’s endorsement and the successes of the initiative in the last four years, SNEPCo’s Managing Director, Mr. Bayo Ojulari, acknowledged the support of NNPC, NCDMB, National Petroleum Investment Management Services (NAPIMS), and the co-venture partners – Total, NAE and Esso – in the strides by SNEPCo.  He called for continued support and collaboration to further unleash the country’s huge deepwater potential to build a better Nigeria with stronger economy for now and the future.

    Ojulari, who was represented by SNEPCo’s Acting General Manager, Nigerian Content Development, Mr. Austin Uzoka, said: “Nigeria’s deepwater outlook indicates a high volume of activity in the building of FPSOs and drilling of new high performance wells with cutting edge sixth and seventh generation drilling rigs, delivering unprecedented schedule optimisation. SNEPCo obviously has blazed the trail here and would continue its strive to be the best-in-class deep-water energy company generating top-end employment and boosting local capabilities.

    “As a Nigerian engineer, nothing makes me happier than seeing indigenous vendors and service providers break new grounds and play up to the international stage in engineering and other seemingly complex jobs.”

    At the forum were House Committee Chairman on Finance, Mr. Jones Onyereri; Chairman of Nigerians in Diaspora (NIDOE) North UK, Dr. Paul Eke; General Manager for Contracting and Procurement, Shell Nigeria and Gabon, Mr. Antony Ellis; and his counterpart for the UK, Mr. Anthony Makenna

  • Mobil Producing congratulates Akwa Ibom at 30

    Mobil Producing congratulates Akwa Ibom at 30

    Mobil Producing Nigeria (MPN) Unlimited, operator of the Nigerian National Petroleum Corporation NNPC/MPN joint venture, has lauded the developmental strides of Akwa Ibom State, since its creation on September 23, 1987.

    Its Chairman and Managing Director, Paul McGrath, said this in a message congratulating the government and people of the state on the 30th anniversary of its creation.

    “This milestone provides an opportunity for the people of Akwa Ibom State to reflect on the vision of the state’s founding fathers and celebrate the progress achieved over the years,” said McGrath.

    The company acknowledged the support it has enjoyed from the people of Akwa Ibom since the state’s creation in 1987 and restated the joint venture’s commitment to long term operations and mutually beneficial relationship with the state.

    “We have enjoyed relatively peaceful relations with the people of Akwa Ibom over the years. Our commitment is to ensure more social and economic benefits from the joint venture business accrue to the communities near our operations and across the state,” said McGrath.

    He added:“We are proud of our contributions to the development of Akwa Ibom State and look forward to working together for greater achievements,” he added.

    Mobil Producing Nigeria commenced operations in Nigeria in 1955 and operates a Joint Venture with the Nigerian National Petroleum Corporation (NNPC). The joint venture has made substantial contributions in the areas of health, education, and empowerment projects in its operational bases in Akwa Ibom State.

  • NETCO made N5.1b profit in 2015, 2016

    NETCO made N5.1b profit in 2015, 2016

    The National Engineering and Technical Company Limited (NETCO), the engineering arm of the Nigerian National Petroleum Corporation (NNPC), grossed a profit after tax of N5.1 billion for two financial years  – 2015 and 2016.

    The breakdown shows that N1.4 billion was realised in 2015, while N3.7 billion was earned in 2016.

    At the company’s Annual General Meeting (AGM) in Abuja, its Chairman, Board of Directors, Mr. Bello Rabiu, lauded the feat achieved by the firm, despite the harsh economic realities.

    He said the company’s profit was boosted by the resolve of NNPC Group Managing Director Dr. Maikanti Baru, and top management committee (TMC) to transform its Autonomous Business Units (ABUs) to profit centres.

    He noted that with the stride, the company had proved that if given the necessary support by shareholders, it has the potential to make better returns, especially now that the economy has exited recession.

    Rabiu on behalf of the shareholders expressed appreciation to the NNPC boss, the TMC and others for their support and ensuring the required patronage for sustained growth. He also commended NETCO’s management and staff for their continued efforts to sustain shareholders’ confidence and the stakeholders’.

    NETCO’s Managing Director SikyAliyu said the company, in 2015, won four new contracts and executed nine projects, and recorded 374,000 man-hours of work, despite the downward trend in the oil and gas industry.

    The highpoint of the AGM was the presentation of a cheque of N610 million dividends to NNPC’s Group Managing Director for NETCO’s 2015 and 2016 financial years.

    Baru, who congratulated the company for making profit in the face of drop in crude oil prices, added that NNPC  would continue to drive NETCO not only to be an engineering company of choice, but also to become a procurement and construction outfit of repute.

    “It is, indeed, with pleasure that I am receiving this N610 million dividends cheque from NETCO. This is a symbol that we are driving the company in the right direction despite downturn of crude oil prices. We are also driving NETCO to diversify its operation to procurement and construction and it is my hope that the N610 million would soon become $610 million,” Baru said.

    NETCO was established in 1989 to acquire engineering technology through direct involvement in all aspects of engineering in the oil, gas and non-oil sectors of the economy. NETCO is Nigeria’s premier indigenous engineering company with the strategic vision of providing basic and detailed engineering, procurement, construction supervision and project management services, using state-of-the-art technology.

  • Nigeria must apply caution on oil revenue spending, says NEITI

    Nigeria must apply caution on oil revenue spending, says NEITI

    The Nigeria Extractive Industries Transparency Initiative (NEITI) has advised Nigeria to apply restraint in spending oil revenues, in view of the experience from economic recession and instability in the oil market.

    The agency said the time had come for the country to embrace a robust saving culture, irrespective of whether oil prices are low or high, noting the importance of healthy savings as one of the tools for tackling resource curse.

    It recommended that the federating units, especially the federal and state governments seek the speedy resolution of pending cases at the Supreme Court on the constitutionality of remittances to the Excess Crude Account, and the Nigeria Sovereign Investment Authority.

    It also said there is urgent need for the government to amend Section 162 of the 1999 Constitution, drawing on the political consensus that led to the creation of the Excess Crude Account (ECA) and the Nigeria Sovereign Investment Authority (NSIA). NEITI noted that oil revenue savings in the ECA and Stabilisation Fund should be consolidated into the Nigeria Sovereign Investment Authority. “We are persuaded by the recent 9 out 10 score ranking of NSIA by the global sovereign wealth institute transparency index, the highest by an African Sovereign Wealth Fund,” it said.

    NEITI Director of Communications Ogbonnaya Orji noted that the NSIA was the only one of the three funds that has recorded profit, adding that NSIA should be strengthened with appropriate guarantees on transparent and accountable governance to reassure stakeholders.

    Orji, who spoke with The Nation on phone, said the time to separate government expenditure from oil revenues and pursue prudent macro-economic policies was now. He said these measures were critical success factors that would rescue the country from resource curse syndrome.

    There are predictions the Nigerian oil reserves would likely dry up in the next 38 years, development economic analysts have said. If the proceeds from oil are not diversified into the non-oil sector, the country may be in for more problems

    NEITI noted that resource-rich countries, including Nigeria, that depend on revenues from natural resources to finance annual budgets, plan early to insulate themselves from  price volatility in the international market and eventual depletion of the resources.

    He said many countries set up stabilisation funds for the rainy day and for the future of the next generation.  This, he said, requires a deliberate policy by the government to set aside money earned from natural resources, especially during periods of high prices to help sustain expenditure when prices fall.

    The stabilisation funds, he added, protect countries against total dependence on natural resources’ revenue and create incentives to look in wards, he restated.

    Furthermore, Orji recalled that saving a portion of oil and gas revenues began in Nigeria in 1989, when the Stabilisation Fund was set up.  The objective was to set aside 0.5 per cent of the Federation Account to support any state that suffers absolute decline in its revenues as a result of circumstances beyond its control.