A cash-call exit agreement between the Nigerian
National Petroleum Corporation (NNPC) and
Joint Ventures partners, the Federal Government
has saved about $1.7billion.
It will repay the Cash Call arrears of
$5.1billion within five years.

These facts are contained in a document titled
“The new JV Self-Funding Model/ Cash Call Exit:
Issues and implications”, which has been
presented to the Federation Account Allocation
Committee (FAAC) by the Nigerian National
Petroleum Corporation (NNPC).
A critical part of the document, which was
obtained by our correspondent, borders on “Key
Negotiated Terms” on the lingering JV Cash Call
arrears.
The terms were part of issues discussed at the
November 21 session of the FAAC Post-Mortem
Sub-Committee meeting.
The key terms are as follows: “On JV Cash Call
arrears, the full and final settlement of the
arrears amount to $5.1billion which represents
75% of the reported arrears of $6.8billion.
“The negotiated amount ($5.1billion) is inclusive
of indigenous JV partners ($436.09m). The
duration of repayment is five (5) years.

“The $1.7billion reduction write-down will not
qualify as a tax- deductible expense by the
International Oil Companies JV partners for PPT
determination.
“No tax payable on arrears to be repaid. Receipt
by the IOC JV partners of the repayment of Cash
Call arrears of $5.1billion represents refund of
advances made on behalf of NNPC and is not
revenue to IOCs. Therefore, it is not subject to
any tax, fee or levy.”
It was also agreed that the “repayment source
will be NNPC’s share of incremental production
from JV activities after payment of royalties.
“100% of PPT from incremental Crude Oil
Production is payable to the Federal Inland
Revenue Service (FIRS) after deduction of
related cost of production and accumulated
arrears.”

On the 2016 JV Cash Call funding shortfall, the
terms indicated that there will be “phased
payment of the shortfall to manage impact on
the foreign reserves.
“The parties will set up a mechanism to ensure
the remaining future approved 2016 JV Cash Call
funding shortfalls are settled installmentally up to
April 2018.
The NNPC and its Joint Venture partners had on
December 15, 2016 signed a cash-call exit
agreement. The JV Partners are Shell, Total,
Chevron, ExxonMobil, Nigeria Agip Oil Company
(NAOC) and Oando.
At the ceremony, the Minister of State for
Petroleum Resources, Dr. Ibe Kachikwu, said
with the agreement, the Upstream petroleum
sector will soon be upbeat in a flurry of
activities.

”This event is significant because it has taken us
to a point where we can compete with our
colleagues all over world.
“We have dealt with the downstream, and this is
probably the most important item in the
upstream and that is obvious we will begin to go
into the policy measures and infrastructural
development and the rest after the signing
ceremony,” he said.
The Group Managing Director of NNPC GMD, Dr.
Maikanti Baru, said the exit cash call agreements
comprised three components which are: the
process of settling the pre-2016 cash call areas;
the process of sustaining the cash call payment
from 2017; and agreement and settlement over
performance in 2016.

NNPC, through its General Manager, Group Public
Affairs Division, Mr. Nu Ughamadu, had said:
“Under the new arrangement the entire NNPC
equity Oil and gas revenues are now to be paid
directly into the Federation Account.
“Hitherto, competition from other appropriated
items of expenditure in the Federal
Government’s budget has always limited the
deduction of technical cost required to fund the
cash calls on monthly basis.
“It is expected that execution of this agreement
would end the long standing cash call challenges
that have impacted the Nigerian oil and gas
industry over the years.

“With this arrangement, the Federal Government
will continue to receive royalties, taxies and
profit from its equity share of JV oil and gas
production while the cost of operation is
deducted upfront.
“The agreement provides that the outstanding
cash call arrears will be repaid within a period of
five years through incremental production
revenues without impacting the established
based production revenue.”

http//:thenationonlineng.net/fed-govt-saves-1-7b-jv-cash-call-arrears/

I really think Buhari appointed himself petroleum minister to prevent another Allison Madueke scandal and he wasn't ready to trust anybody that time.
But I feel Ibe Kachukwu has done enough to deserve a promotion from Bubu who to me is probably not performing oversight functions which he might have been doing previously, you never know.
Cc lalasticlala
cc Mynd44

Govt of saving. I was expecting buhari to start some major projects like dams, refinery, rail etc and not endless savings. He is still better than his predecessor though.

Desyner:
Govt of saving. I was expecting buhari to start some major projects like dams, refinery, rail etc and not endless savings. He is still better than his predecessor though.

They are balancing the books: Borrow here; ssve there.

Most of the money budgeted for these projects are borrowed and some of the projects have to be jointly funded hence the lack of speed in executing projects.

Stories upon stories with NOTHING worthwhile to show for the citizens.
Lietocracy government of lies, by lies for lies.
The stealing going on by barawo bubu will shock anyone. He is busy with his 40 thieves cabal presidency of the All Poverty Congress, APC in looting us like there is no tomorrow.

Why is no one asking why we are in recession despite budgets as follows:

2015 - N4.5 trillion
2015 - N2.1 trillion supplementary requested / N575 billion approved
2016 - N6.06 trillion
2017 - N7.3 trillion


Sources: http://www.reuters.com/article/nigeria-budget-idUSL5N0YB49M20150520
http://dailypost.ng/2015/11/18/buhari-seeks-n2-1trn-supplementary-budget-for-2015/
http://www.vanguardngr.com/2015/12/senate-approves-n575bn-supplementary-budget-for-buhari/
http://www.vanguardngr.com/2016/05/buhari-signs-n6-06trn-2016-budget-change/

www.nairaland.com/attachments/3366370_125927734333042835425381910869646342089244n1_jpeg1d4b88cded8ebcb69839caf542969a5a



www.nairaland.com/attachments/4024299_bubu6_jpeg86aaf8fa6cd32a5104ab6bf996dd1ee3

Desyner:
Govt of saving. I was expecting buhari to start some major projects like dams, refinery, rail etc and not endless savings. He is still better than his predecessor though.

His predecessor who started and completed many projects that even Femi Adesina acknowledges?
His predecessor who raised minimum wage from N7,500 to N18,000 and paid unlike many All Poverty Congress, APC governors?
His predecessor who grew our economy into the biggest on the continent, which barawo bubu and his 40 thieves cabal have turned into a recession?
Are you serious? Or are you seriously joking?

nawtyme:
Previous Govts Initiated ‘Most Of The Things This Administration Is Doing’ – Adesina


A majority of the projects the Muhammadu Buhari administration is working on was inherited from previous administrations, the Special Adviser to the President on Media and Publicity has said.

Mr Femi Adesina said this when he appeared on Channels Television’s special Independence anniversary programme on Sunday.

“Most of the things this administration is doing – 60 to 70 percent of them – were initiated by previous governments,” he said.

“That shows you that in the past a government will come and say ‘this is not our project’ And it will discard what was being done and start fresh ones.”

As a result, Mr Adesina said there are many half and quarter-completed abandoned projects.
But rather than abandon the project, he explained that the current administration will complete it.

An example is the Abuja-Kaduna rail project which the Presidential aide said was up to maybe 60 to 70 percent complete when the last administration left.

“This administration came, completed it and inaugurated it. Then you will still find some people shouting, ‘they are claiming credit for what the past administration started,” he said.

“It shows there is a mentality in Nigeria that makes governments not want to complete what previous governments have started. But this administration is not going that way at all, it is just doing what needs to be done for the good of the country.”

Another example is the Mambilla power project, which has been in the works since 1972, but has now started taking shape under this administration.


https://www.channelstv.com/2017/10/01/previous-govts-initiated-most-of-the-things-this-administration-is-doing-adesina/

www.nairaland.com/attachments/4184139_nigria_jpeg5ee41737941fb40e6e6ef91349ef6dd1

Another saves suffering and hunger remains constant