As Oil Prices Hit 12-year Low, OPEC Members Request Emergency Meeting
Minister of State for Petroleum Resources Emmanuel Ibe Kachikwu, has said a ‘couple’ of members of the Organisation of Petroleum Exporting Countries (OPEC) are requesting an emergency meeting, saying current market conditions justify the need to hold such a gathering.
Benchmark Brent crude oil futures LCOc1 were trading at less than $31 per barrel yesterday, their lowest level since April 2004, and have shed almost three-quarters of their value since mid-2014. At the current price, it means oil prices have fallen to near a 12-year low.
Kachikwu told reporters at an energy conference in Abu Dhabi that there was a lot of push from various blocs within OPEC for a meeting.
“A couple of countries, I don’t want to mention names,” he said when asked if any had requested holding an emergency meeting.
Any meeting that would take place would be to review OPEC’s position to see if there was any need to change its strategy, Kachikwu said, adding that the meeting could take place in February or March.
Kachikwu told AFP that he expects an extraordinary meeting of the OPEC oil cartel in “early March” to address nosediving crude prices.
“We did say that if it (the price) hits the 35 (dollar per barrel), we will begin to look (at)… an extraordinary meeting,” said Kachikwu.
The prices have hit levels that necessitate a meeting, he told an energy forum in Abu Dhabi.
The US crude oil price tumbled below $31 a barrel Tuesday, extending a sell-off that has pushed it to more than 12-year lows amid a global supply glut, a strong dollar and tepid demand.
Saudi-led Gulf exporters within OPEC have so far refused to cut production to curb sliding prices, seeking to protect their market share despite a heavy blow to their revenues.
Kachikwu, who was president of OPEC until the end of December, said that member states differ on the issue of intervention.
“One group feels there is a need to intervene. The other group feels even if we did, we are only 30 to 35 percent of the producers really,” as 65 per cent of supply comes from non-OPEC countries, he said at the Gulf Intelligence UAE Energy Forum.
“Unless you have this 65 percent (of) producers coming back to the table you really won’t make any dramatic difference,” he added.
Senate to begin debate of 2016 budget
The Senate has announced that the 2016 Appropriation Bill submitted by President Muhammadu Buhari will be subject to debate from the lawmakers from Tuesday 19th January.
The Senate President, Bukola Saraki, made the announcement on Wednesday, during plenary.
“Senate President @bukolasaraki announces that the debate of #2016AppropriationBill will commence on Tuesday 19th January 2016,” reads a tweet from the Twitter account of the Nigerian Senate.
There were reports,Tuesday, that the budget was no longer available in the Upper Chamber, leading to rumors of ‘Missing budget’
However, it is unclear if the budget is now available or the speech of Saraki is to douse tension.
NCC vs MTN: Court orders parties to maintain status quo
A Federal High Court sitting in Lagos, yesterday, ordered parties to maintain status quo, following a mareva injunction by the Attorney General of the Federation, seeking to bar MTN Nigeria from emptying its accounts in 21 commercial banks in Nigeria.
Trial judge, Justice Idris Mohammed, ordered parties to maintain status quo ante bellum pending the determination of the suit and adjourned till January 22, 2016 for hearing.
“An order is hereby made directing the parties cited herein to maintain the status quo ante bellum pending further hearing,” the judge said.
The AGF, has sought “an order of mareva injunction restraining the aforementioned banks from releasing, further releasing any funds, making sale, transfer or payment of any monies or dealing in any manner whatsoever with any and all monies maintained by the plaintiff/respondent (MTN) or its agents, privies, subsidiaries, sister companies or the like in the aforestated banks that will alter, decline or reduce the amount of the first defendant’s/applicant’s fine against the plaintiff/respondent in the sum of N1,040,000,000,000 which has remained wholly unsatisfied, pending the determination of the motion on notice.”
The application was to prevent MTN from suspending the payment of the N1.04 trillion fine imposed on it by the Nigerian Communications Commission, NCC, over its failure to deactivate its unregistered subscribers.
Even though the court did not expressly grant the application, it has, meanwhile by the status quo order, prevented MTN from moving funds from the accounts in the 21 commercial banks in Nigeria outside the country.
The AGF and Minister of Justice, Abubakar Malami, SAN, who filed the application, yesterday, had expressed the fear that MTN could move all its funds out of the country before the N1.04tn fine could be enforced.
He had prayed the court to order all the 21 banks to open a special interest-yielding account in the name of the Chief Registrar of the Federal High Court and move N1.04 trillion out of whatever funds that was standing to MTN’s credit in their possession.
The counsel for the AGF, Mr. Dipo Okpeseyi, SAN, in a 14-paragraph affidavit in support of the application, had averred that MTN was in the habit of regularly repatriating its funds out of Nigeria.
He further averred that between October 2007 and May 2009, a period of 19 months, MTN moved over $7.7 billion of the money made in Nigeria to a foreign account, pointing the court’s attention to an instance when in one day, specifically on February 8, 2008, MTN transferred over $936 million out of Nigeria to accounts in Mauritius, Cayman Island and British Virgin Islands.
“Unless this court urgently entertains this application, the plaintiff/respondent would move its funds out of Nigeria, being the jurisdiction of this honourable court, and thereby frustrate the enforcement of the fine in the likely event that this honourable court sanctions the imposition of the fine,” he had averred.
He also averred that MTN was under an obligation to pay the N1.04 trillion fine, because it was NCC’s administrative decision, which remained final unless it was reviewed by the commission or nullified by the court, adding that though NCC had earlier given MTN a concession on the fine and reduced it to N780 billion, MTN has neglected or failed to pay on or before December 31, 2015, the fine remained N1.04 trillion.
Justice Mohammed had noted that the AGF had not shown enough facts to prove that MTN was about to empty its bank accounts and move its funds out of the country.
Idris, who noted that the case was sensitive and of public interest, said he would rather hear the case filed by MTN to challenge the fine and give a judgment within a short time.
MTN may lose spectrum license over NBC probe
The federal government may review the 700MHz spectrum license sale following the ongoing probe into the activities of National Broadcasting Commission (NBC), Daily Trust learnt yesterday. The NBC director general Emeka Mba was arrested on Monday by the Economic and Financial Crimes Commission (EFCC) for allegedly operating a secret account into which about N17billion out of N34bn paid by MTN Nigeria for the 700MHz license was kept.
Part of the reasons for his arrest was a petition written by some aggrieved broadcast and telecoms industries players to EFCC alleging that Mba contravened due process in the spectrum sale to MTN, according to a source. Already, the Frequency Management Council (FMC) is reviewing the spectrum sale and the ongoing probe of NBC may provide the ground for its cancellation, the source, who is a top government official, told Daily Trust yesterday.
The FMC which has a representation from the ministries of science and technology and communication was said to have given NBC the nod to sale the spectrum to MTN during twilight of Goodluck Jonathan administration. But some telecoms and broadcast firms who felt the deal was not transparent later kicked against the sale when the President Muhammadu Buhari administration came on board. Later NCC also voiced out it disagreement with the sale.
The firms, on their part, alleged lack of transparency in the sale to MTN while the NCC said the spectrum should have been auctioned by it not NBC. “We do not intend to join issues with them but we intend to avail ourselves of existing mechanism for arbitration and mediation through the Frequency Management Council,” the NCC executive vice chairman Prof Umar Danbatta had said recently. MTN spokesperson could not be reached yesterday but a top official in the country said the company had nothing to fear as it did not breach any Nigerian law in getting the license. The NBC spokesperson Malam Awwalu Salihu declined to comment on the matter.