Shell sees 40 pct slide in fourth-quarter profits

Royal Dutch Shell has said it expects fourth-quarter profits to slide at least 40 per cent from a year ago following a collapse in crude prices that has hit industry revenues, leading to job losses and billions of dollars in spending cuts.

The Anglo-Dutch oil major, in a trading update ahead of a shareholder vote this month on its £36bn planned takeover of rival BG Group, forecast that earnings, on a current cost of supplies basis excluding exceptionals, would fall to between $1.6bn and $1.9bn, below the consensus view of analysts.

However, Ben van Beurden, chief executive, said he was “pleased with Shell’s operating performance in 2015, and the momentum in the company to reduce costs and to improve competitiveness”.

“Bold, strategic moves shape our industry. The completion of the BG transaction, which we are expecting in a matter of weeks, will mark the start of a new chapter in Shell, to rejuvenate the company and improve shareholder returns,” he said.

He reiterated Shell’s plans to reduce capital spending by 20 per cent to $29bn for last year from 2014 levels, and indicated that spending for the enlarged company would be $33bn in 2016, a reduction of about 45 per cent in combined spending, which peaked in 2013.


Brent crude has tumbled more than 70 per cent from its summer 2014 peak of more than $115 a barrel to just $30, amid a US supply glut, weaker Chinese demand and Opec’s decision not to cut output.

Oil and gas groups have responded by slashing capital expenditure in an effort to shore up cash flow and preserve dividend payouts to investors. Wood Mackenzie, the consultancy, calculates that nearly $400bn of spending on big, new projects has been put on hold.

Bureaux de Change owners fighting Naira

Central Bank of Nigeria Governor, Mr. Godwin Emefiele, says it will not go back on restrictions placed on Bureaux de Change (BDCs), describing them as waging a relentless war on the Naira.

He stated thid when he briefed lawmakers yesterday at the national assembly in Abuja. He said that the activities of operators of BDCs were mainly responsible for the dwindling value of the Naira as they embark on rent seeking speculation of the local currency.

He also told the senators that some 2,837 BDC operators were leading the speculations against the Naira in the parallel market, adding that since stoppage of allocations to BDCs, they have been sourcing their dollars from oil companies and other foreign exchange earners.

DMO, SEC aim for debut sovereign sukuk in 2016

The Debt Management Office (DMO) and capital market regulator  Securities and Exchange Commission, SEC, have agreed to collaborate on a debut issuance of sovereign Islamic bonds (sukuk) before the end of the year, the two bodies said.

The move could spur wider issuance of sukuk in one of Africa's most liquid debt markets, following similar sovereign deals from Senegal and Ivory Coast.

The DMO in a statement said the issuance of a sovereign sukuk was part of a strategic plan developed by the agency three years ago and it will now seek help from Nigeria's Securities and Exchange Commission in areas such as capacity building.

The statement further stated that issuing a sovereign sukuk will attract significant amounts of affordable capital from the Gulf countries and other established Islamic markets around the world into Nigeria.

The statement did not give a potential size for a maiden sukuk deal, although the DMO is a regular issuer of five- and ten-year local-currency bonds.

In 2013, Nigeria's Osun State issued 10 billion naira ($62 million) of sukuk, but no other sukuk transactions have followed.

Nigeria is home to the largest Muslim population in sub-Saharan Africa, with about half of its 160 million people members of the Islamic faith. It is also home to one of Africa's fastest growing consumer and corporate banking sectors.

Government to sanction errant international airlines

The Federal Government has threatened punitive action against international airline operators that flout local immigration regulations.

Minister of State for Aviation, Hadi Sirika, warned such companies of "dire consequences."

"Government cannot continue to condone the practice of subjecting Nigerians to all forms of suffering," the minister said.

"...either by making them walk long distances before boarding or using small aircrafts that would not carry them along with their luggage to their destinations."

Sirika said the Nigerian Civil Aviation Authority (NCAA) had been directed to invoke all relevant laws to protect the interest and rights of Nigerians and others from being flagrantly abused the airlines.

The minister spoke in Abuja where he met a delegation from the Emirates Group.

He meanwhile assured that the on-going construction of the second terminal at the Nnamdi Azikiwe International Airport in Abuja would be  ready before the end of the year.

He stated that its completion would improve the comfort and convenience of both airline operators and the flying public.

Bill Gates in Kaduna to sign MOU with Dangote

World's richest man, Bill Gates is in Kaduna State to sign an MOU with Dangote foundation on Routine Immunization, Nigeria Bulletin reports.

Gates was received by Kaduna state governor, Nasir El Rufai and Sokoto state governor, Aminu Tambuwal.

Pipeline vandalism: NNPC shuts down two refineries

Two refineries were shut down by the Nigerian National Petroleum Corporation (NNPC) due to pipeline vandalism by the Niger Delta militants last week. The refineries, with a combined capacity of 235,000 barrels per day, resumed production in December and January respectively after long maintenance work.

However, work stopped at the refineries on Sunday following the action of NNPC. Spokesperson of NNPC, Mr Ohi Alegbe, confirmed the shutdown of the refineries which he said was to avoid any fire incident along the pipelines. He said the corporation shut-in the pipelines both for gas and crude oil along the affected areas to avoid further damage to the two refineries.

He said the NNPC will continue to monitor the progress of the refineries and the Nigeria Gas Company and update the public at the appropriate time.

Some militant groups weekend attacked pipelines in the Niger Delta region following the arrest warrant for former militant leader Government Ekpemupolo, known as Tompolo, as part of a crackdown on corruption by the President Buhari administration.

Before the incident, the two refineries were refining about 4 million litres of products which include Dual Purpose Kerosene and Premium Motor Sprit (PMS).

CBN directs banks to enforce N50 stamp duties on transactions

The Central Bank has told commercial banks to start enforcing the country’s stamp duties law on financial transactions with “immediate effect”.

In a circular to the banks, the CBN asked the banks to charge N50 on every N1 000 deposit or electronic transfer made by customers.

Read circular here: http://www.cbn.gov.ng/Out/2016/CCD/SCAN0001.pdf

Deposits or transfers made by a person to his own account, inter bank or intra-bank are exempted. Also exempted are withdrawals from savings accounts.

The CBN said the charges are only payable by receiving accounts and urged banks and financial institutions to support government drive to boost revenue base, in view of the gross fall in oil income.

Nigeria relies heavily on revenue from crude sales but the falling oil price means it will have to look elsewhere to fund its budget.

The Federal Government plans to spend about 6 trillion naira in 2016 with expected revenue of around 3.9 trillion naira, of which only 820 billion would come from oil.