The National Economic Council (NEC), presided over by Nigeria’s Vice President, Professor Yemi Osinbajo, has endorsed a new funding regime for the oil and gas industry.
This will in turn, eliminate the often arduous and onerous cash call regime which has stalled growth in the industry.
The alternative funding stream had been approved earlier this week at the Federal Executive Council meeting and then presented to NEC, as the body mandated to come up with “measures necessary for the coordination of the economic planning efforts of the various governments of the federation”.
Minister of state for Petroleum, Ibe Kachikwu, who briefed State House
Correspondents after the meeting, said: “the current upstream joint venture arrangement in Nigeria’s oil and gas industry, is unincorporated, meaning that NNPC and the International Oil Companies (IOC’s) partner in each joint venture as unique and separate.”
According to the minister, from January to November 2016, under-funding of the NNPC cash calls is estimated at USD $2.3 billion.
This is in addition to the inherited arrears estimated at USD $6.8 billion for 2015 year ending.
Other highlights of the meeting included how to energize the MSME’s as a major economic growth driver in the country.
On the other hand, council observed that there are over 37 million MSME’s in Nigeria, contributing over 84% of the job opportunities in the country, with Lagos as the highest contributor.
The Central Bank Governor, Mr Godwin Emefiele, then told council that the CBN has a fund in excess of 200 billion Naira to provide affordable loans to MSME’s in the country.
Minister of Finance, Mrs Kemi Adeosun however reported to council that as at November 2016, the balance of excess crude proceeds stands at $2, 455,790,144- which is about $2.4 billion.