Gas proceeds from the Nigeria Liquefied Natural Gas and others have dropped by 50.2 per cent from $169.728m in January, the latest data from the Nigerian National Petroleum Corporation have showed.

The NNPC put gas proceeds from the NLNG, Escravos Gas to Liquid, Natural Gas Liquids and NGAS in October at $84.575m.

“Export gas sales and NLNG feedstock accounted for $84.57m i.e. 18.97 per cent contribution to the Federation Account compared with 31.21 per cent contribution in September,” the corporation said in its latest monthly report.

The dip in gas revenue was partly as a result of the sustained fall in global natural gas prices since last year and increased supply in the market.

From a peak of $6 per million British thermal unit last year, the natural gas price has fallen below $2 per mmBtu this year. It was trading around $1.98 per mmBtu.

The NLNG Limited had recently warned that its revenue was being threatened at the international market amid the fall in global oil prices.

Many of the global natural gas markets are linked to oil prices, which have fallen by more than 65 per cent since June last year.

The firm expressed worry over the impact that the fall in crude prices was having on its revenue, stressing that the entry of the United States and Australia into the LNG market was “a real cause for concern.”

The NLNG stated, “The recent fall in crude oil prices from above $100 per barrel in early 2014 to below $60 per barrel in early 2015 and its impact on global LNG/gas prices as well as the demand/supply positions in both our primary and secondary markets in the Atlantic and Pacific Basins have had a significant impact on our revenues and profitability.

“The trend, which will persist till the end of 2015, and which may even worsen going into 2016 with the entry of US and Australian LNG volumes into the market, is a real cause for worry.”

The NLNG, in addition to its traditional deliveries to Europe and the United States, supplies LNG to South America, with deliveries to Mexico and Brazil; and to Asia and the Middle East, with deliveries to Japan, South Korea, India, China, Taiwan, Thailand and Kuwait.

The company, which currently has LNG production capacity of 22 million metric tonnes per annum, is owned by the Federal Government, represented by the NNPC (49 per cent), Shell Gas BV (25.6 per cent), Total LNG Nigeria Limited (15 per cent), and Eni International (10.4 per cent).

http://www.punchng.com/nigerias-gas-revenue-drops-by-50/

“The trend, which will persist till the end of
2015, and which may even worsen going into
2016 with the entry of US and Australian LNG
volumes into the market, is a real cause for
worry.”

This is the same reason why china is fighting haplessly to ensure that their currency becomes a tradeable currency and as well an independent currency. Dollar depreciation seems to affect every other country who uses it to trade in the world market.

This depreciation became visible when the US central bank implemented quatitative easing measures by encouraging investors to borrow money... As such making US dollar not to be in parity with its other counterpart.

And some guys are saying we will be borrowing 1.84 trillion naira to effect the budget. The truth is that we will end up borrowing more than 3 trillion naira if we ever want the budget to be 70% implemented. Is that feasible? Let's watch and see.

Meanwhile a dullard is in the helm of affairs

yanabasee:



This is the same reason why china is fighting haplessly to ensure that their currency becomes a tradeable currency and as well an independent currency. Dollar depreciation seems to affect every other country who uses it to trade in the world market.

This depreciation became visible when the US central bank implemented quatitative easing measures by encouraging investors to borrow money... As such making US dollar not to be in parity with its other counterpart.

It's like you don't understand the main problem. Saudi Arabia has been pumping more into the market, this means excess supply. USA and Australia that were hitherto our customers are now our competitors in the market. Iran is resuming pumping more in 2016. The oil price crash is following a natural order.

TonyeBarcanista:

It's like you don't understand the main problem. Saudi Arabia has been pumping more into the market, this means excess supply. USA and Australia that were hitherto our customers are now our competitors in the market. Iran is resuming pumping more in 2016. The oil price crash is following a natural order.

We are on the same page sirree...

I am looking at it from the currency perspective....

Now, the US dollar is a flat currency, meaning, it's not backed by any tangible commodity. From the implementation of the qualitative easing measures by the US Central Bank more money is created for borrowing, which makes the law of supply and demands to step in. Making the existing more less valued..

This law of supply and demand defines the effect that the availability of a particular product and the desire (or demand) for that product has on price

Generally, if there is a low supply and a high demand, the price will be high. In contrast, the greater the supply and the lower the demand, the lower the price will be. This is as a result of monetary policy.

This fall in commodity prices will lead to economic and social disorder in countries such as Nigeria that are solely dependant on oil.
You will see lots of strike action by labour, trade unions, students etc.
We might be experiencing a hyper inflation. This is made worse by our inability to refine our petroleum products leading to depletions of the already scare forex.
Agric which every one is clamoring for is not that easy because it is capital intensive, time bound and dependant on biological factors and finally market at a time commodity prices are low.
Nigeria may have to consider the north Korea option to survive or the Iranian model of survival under sanctions.
I must add that this is a self inflicted sanction on Nigerians by the ruling class over the decades.

Which way naija??

Iwe kiko la i si oko ati ada, ko i pe o, ko i pe o, ise agbe ni ise ile wa, eni kosise a ma JALE... a ma JALE!!!






They forgot agriculture, concentrated on oil and gas... Even dodo sef, i sure say we dey import...

Another bad news. I hope the special 'budget of change' covered all this.

Intelligent governments always know this things long before it happens.

Why is everything just going down na? God help us.

It's the beginning of the end.

Nigeria is in for a rough ride in 2016.

Buhari why?


With the way Nigeria is going down, they might soon discover Hell Fire!!"

All l want is to pay less when entering public transport cos l dn't hav a car.

Kilode

Price of domestic gas should pls drop

Hmmm..it is well

No, it actually increased by 50% ..


I thought the minister of information said we should never bring negative news to limelight

May God help Nigeria o .

The massive looting that took place during GEJ's tenure has finally brought Nigeria to its knees. Greece would be child's play come 2016. The wicked Jonathan government fleeced our money when oil prices were sky high. The price is now projected to be at $20/barrel in the first quarter of 2016.

Now is the time for Buhari to be decisive and put this wicked, insensitive, clueless, heartless, corrupt and pouchy man in jail. Recorver the loot of him and his cohort and draw a strong and hard economic recovery policy. There is not much he can still do because the man called GEJ destroyed Nigeria!

-CramJones

PrinceChester:
Buhari why?
With the way Nigeria is going down, they might soon discover Hell Fire!!"

lol with this current economy i think we have discover it already and you are the prince.

Its going 2b tough for dis country in 2016, notwithstanding, we have d human resource to scale through.
Naija should return to Agri-Biz...
Its time we rebrand ourselves 2d world.

TonyeBarcanista:

It's like you don't understand the main problem. Saudi Arabia has been pumping more into the market, this means excess supply. USA and Australia that were hitherto our customers are now our competitors in the market. Iran is resuming pumping more in 2016. The oil price crash is following a natural order.

This is scary.

More untold hardship for Nigerians.

virginboy1:

This is scary.

Na to beg Saudi Arabia to pity us walahi.

Summary and implication to economy please

How sad. But why is nigeria afraid of also exploring the idea of quantitative easing like that of the USA?