₦airaland Forum

naijaguy77: ECA - Excess Crude Account

The ECA was conceived by the OBJ regime as a savings account to put money away for a "rainy day". Since we base our budget on price of oil, if we say we budget $65 per barrel at 2m barrels per day, during the year, we may be fortunate and oil might actually trade at $100 per barrel and we might succeed in producing an average of 2.3m barrels per day. The excess money we earn would then go into the ECA. This was fantastic public funds management by OBJ, especially because oil prices fluctuate a lot, and sometimes we earn less than we anticipated, the funds in the ECA would the be our saviour on such a rainy day.

This was all going well, but there was one problem. The greedy governors realised the the ECA, though a good for the country, was actually unconstitutional, therefore illegal. The governors (including Fashola) threatened sue the FG if all the money was not immediately "shared".

This puts the FG in a very difficult position, as the FG knows that it is sound economic policy and prudent management to save for a rainy day. Everytime the ECA funds build up to any significant amount, the governors would come and insist on sharing the money or else they will go to court.

This is the genesis of the ECA depletion. The governors want the money shared even when it is not a "rainy day". And members of the national assembly also insist on sharing the money, usually insisting that Nigeria has many problems and do not need to save money that can be used to "solve our problems". Essentially, every arm of government bar the executive arm of FG is against savings.

After much bickering, the FG through NOI conceived of the Soverign Wealth Fund, which would be backed by law, as a compromise and a way to ensure that some money is put away for emergency. Even at this, the legislature and govs made sure the cut the FG down and insist on a meagre $1 billion for the SWF.

So, is it right to accuse the FG of squandering the money in ECA? Well, yes the FG also got their share of the money, but it is wrong to blame it on the FG, as all the state governors unite in this matter, and their position is always, we must "share" (spend) the money.

Again, it is wrong for Madam Ezekwesili to insinuate that the FG is responsible for this squandering. The entire nation, and all parties - PDP, APC, ACN, Anpp, etc is responsible.

The truth is, the Federal Government of Nigeria is made up of very inept and unsound people, who are almost always up to no good, such that even when someone like Madam Ezekwesili makes an unsound accusation, instead of the FG to take her on and expose her as unsound, their first instinct is to run and hide, or to respond with even more unsound rhetoric. Shameful really, considering that Madam Ezekwesili can be taken apart in 2 minutes. Shame on FG.

Eziachi: Why did you consider his address idiotic? Try and convince me.
Because Aung San Suu Kyi, the Burmese opposition leader made a similar speech recently in London and got an ovation. Like I kept telling you guys, just because you had been programmed by manipulative ethnic politicians with selfish agendas to dislike someone, it doesn't mean that you can't sometimes reason for yourself without been bias and call a spade a spade and on Sundays, with the same mindset, you will all troop into churches, calling on God.

Buhari's crime to some of you is simply he is a northerner contesting power with Jonathan a Southerner. Nothing else!
Making up all this lies against this guy just to achieve a goal bothers on conscience and I have one.

In 2003, it was the turn of Yorubas to say their bit against Buhari, because he stood between their beloved son OBJ and Aso Rock, never mind their current hypocrisy of now of making him some sort of a hero just for the convenience of putting APC in power with a possible Yoruba person on the ticket.
This is why Nigeria is totally messed up and why I am a die hard Biafran- the only option to solve this basket case of a union of people that love to hate each other and at the same time expects progress.

ice dee: I wonder when nigerians will begin to think straight and not believe everything in the news papers,this all politics 2015 is around the corner,the PDP led govt will do anything and everything to blacklist it's opposition,but I know this time whether nigerian open their eyes or fail to open their eyes to they truth,this so called detractors in govt will fail

Eziachi: And you don't have problem with all the wives of African dictators coming to Nigeria to compare who wears the best makeup?

hisson3: just one word to classify you: DAFTNESS!

berem: Nigeria still has a long way to go as majority still use Kerosene in this 21st century.

tayoccu: On the issue of security, are the so called "security operatives" hired by the traders registered with the civil defense corps?
Are their fire arms licensed?
If the answers to my questions are no, then its illegal, and the "security" men have to be arrested.

Delafruita: in essence,the government should do everything for you.citizens have a responsibility as well.keeping your environment clean is one of them.there might not be a central dump,but the government has provided the LAWMA trucks which have proven to be very useful in almost all parts of lagos.

Standing5: And what's wrong with creating one now? The situation on ground is bad, yes, but that does not mean the state shouldn't move to clean up what has become a mess. As for Taxpayers pleading with the govt to do their job, you may need to know of other states where such plead are seen as impossible, for a relatively working government like that of Lag i thing delaying the cleaning up of Ladipo market is justified.

ba7man: Ladipo market was never designed to be an auto-spare part market from the onset. Igbo traders move into residential areas and turn them to markets without regards to the activities they'll be carrying out there.

Sincere 9gerian: That's means the govt has effectively removed ALL subsidies on petrol and diesel but it appears there is still subsidy on kerosine.

Ghana hikes fuel prices
Page last updated at Saturday, February 16, 2013 20:20 PM // 4 Comments

Fuel_stationThe Ghana government today announced it has increased the prices on fuel between 15-20%

The new prices take effect Sunday February 17, 2013, according to a statement signed by the Chief Executive of the National Petroleum Authority Alex Mould, reports myjoyonline.com February 16, 2013.

“The maximum indicative price for a litre of petrol will be GH¢2.0496 (GH¢9.22 per gallon) and the maximum indicative prices for a litre of diesel will be GH¢2.0683 will (GH¢9.31 per gallon)” it quoted the statement as saying.

Kerosene will now sell at 104.65 pesewas per litre, a 15% rise while LPG will go for 194.85 pesewas per litre or GH¢24.36 per a 12.5 kg cylinder, according to the report. The LPG price is increased by 50%.

The statement said the new prices are based on the crude oil price of $116 per barrel and an exchange rate of GH¢1.89/USD.

By Ekow Quandzie

seanet02: Never expect you to be reasonable.
How about you using your senses?

“We are appealing to Governor Babatunde Fashola to direct the Lagos State Waste Management Authority, LAWMA, boss, Dr. Ola Oresanya to construct a central dump site for the market that has more than 20, 000 members.

Standing5: Northern Interest with mostly PDP-like DNA and origin.

North Kicks against Petroleum Industry Bill (PIB), Thinks it Favours Niger Delta States

nassEmerging information from the National Assembly has revealed that opposition to the passage of the newly introduced Petroleum Industry Bill (PIB) was revived in the Senate on Tuesday, as the lawmakers suspended the consideration of the bill, despite efforts by the Senate Leader, Senator Victor Ndoma Egba. Sources said the decision to jettison the debate was as a result of the underground moves by the North against the PIB.

According to the Nigerian Tribune, the North had mobilised against the bill through the Northern Senators’ Forum, adding that the report of an independent consultant engaged by the region to scrutinise the bill returned a negative verdict.

It was learnt that the consultants asked by the Northern establishment to X-ray the bill reported that its passage in its current form could lead to the federation pumping more resources to the Niger Delta, adding that it could lead to a 10 per cent increase in the resources of the region aside the 13 per cent derivation being enjoyed by oil producing states.

The report asked the Northern Governors Forum to scrutinise the bill, since it was sent to the National Assembly without the input of the federating units. The report indicated that the Niger Delta would add other allocations to the existing 13 per cent derivation fund, coupled with funding of the Niger Delta Development Commission (NDDC) and the amnesty programme.

According to the report, the North was also angry that the PIB did not prioritise gas supply to the North, as it was also uncomfortable that revenue accruing to four states, including Akwa Ibom, Bayelsa, Delta and Rivers is bigger than that of the 19 states of the North put together. The region also criticised what it called apparent divestment moves through the establishment of a National Oil Company and National Gas Company.

Another major example is the case of the non passage of the Petroleum Industry Bill (PIB) which was first mooted in 2000. It took Algeria barely two weeks in February to pass her own new oil law which seeks to provide better incentives to investors in the face of a massive shift in the oil world.

Petroleum Industry Bill and sectional interests
January 11, 2013 by Punch Editorial Board
Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke

Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke
| credits:

AFTER years of twists and turns, the much awaited Petroleum Industry Bill is once more being assailed by narrow, vested interests. The latest assault by some legislators purporting to represent the “North” could, for the umpteenth time, knock down the intended legislation and continue to hold up progress in our oil and gas sector. But mischief-makers should no longer be allowed to deny this all-important industry a relevant legal framework to meet today’s challenges. And Nigerians should be mindful of oil-induced civil conflict.

The apparent grouse of lawmakers from the North is the proposal to reserve 10 per cent of all oil and gas earnings for the oil producing areas through the Petroleum Host Community Fund. Echoing other lawmakers from the North who had earlier vowed to frustrate its passage, Senator Bukar Abba Ibrahim of Yobe State complained that the additional 10 per cent for oil producing states was one revenue stream too many as such states already enjoyed seven other special sources. This rabid fixation on oil revenues has, in no small measure, contributed to the collapse of federalism, resulting in economic retrogression over the years.

Designed to bring petroleum laws up to date with global trends and present realities, the bill has nevertheless suffered interminable delays since it was first presented to the Sixth National Assembly in 2008, which later abandoned it after some time-wasting legislative manoeuvres. It has suffered further tortuous journey since its reintroduction. After subsequently holding a public hearing in July 2009, the parliament once more succumbed to pressure from vested interests and abandoned the bill. Opposition has come from oil multinationals, who have behaved pretty much as they pleased for decades; from entrenched interests within the bureaucracy; and from the corrupt Nigerian National Petroleum Corporation, whose executives gorge themselves at public expense by exploiting the rampant opacity that defines its operations; from marketers, politicians and briefcase traders, who colluded with top bureaucrats to cream off over N2 trillion in fraudulent petroleum subsidy claims last year; and from sectional power brokers.

The responsibility for the diversification of the nation’s revenue base lies with the government and parliament. A federal polity operates everywhere on the principle of considerable autonomy for its federating states, as well as fiscal and resource control. If, as Ibrahim said, “nobody planted or farmed oil, it is God who put it there …”, it is also true that all other parts of Nigeria are blessed with natural endowments. Northern states have unsurpassed advantage in agriculture and account for a greater quantity and variety of the 34 solid mineral types identified by the Solid Minerals Ministry as ready for exploitation. The governors and ACF would serve the interests of the impoverished Northern masses better by insisting on immediate exploitation of their abundant mineral deposits and the prudent management of revenues available to them.

Those who unreasonably seek to deny the oil producing states succour forget the enormity of the environmental degradation being suffered by Niger Delta communities. The United Nations Development Programme reported 6,817 oil spills between 1976 and 2001, an update of a Department of Petroleum Resources’ estimate of 1.89 million barrels of crude spilled in the Delta in the 20 years to 1996, while the World Bank says the amount of oil spilled could be 10 times of the official reports. Millions of residents have lost farms, fishing and health due to contamination. As far back as 1993, Shell acknowledged in its Handbook that “oil pollution could cause adverse impact on people (water quality), vegetation (smothering mangrove trees, crops, shore vegetation and fauna (fish, shellfish, and soil fauna).

Yet, it is often forgotten, or more appropriately ignored, that oil is an exhaustible mineral. According to a World Bank report, Nigeria’s oil reserves will be depleted in 41 years. The World Bank chief economist for Africa, Shantayanan Devarajan, was quoted as saying last October that mineral wealth in African countries including Nigeria does not translate into prosperity for the people because the money accruing from it does not pass through the citizens, and the citizens do not see the wealth as theirs. What then happens to the Niger Delta communities when Nigeria runs out of oil and the people can neither farm nor fish?

There is no percentage of the oil wealth that can be considered too high to develop the area. It is a right, not a privilege. Various governments must shift their focus away from oil revenues and concentrate on other non-oil sectors. The recalcitrant legislators must move with the times; the era of beggar-states waiting for monthly stipends from the Federation Account is no longer sustainable. Economically, it is dragging the nation back by discouraging production and creativity. Politically, it entrenches a culture of indolence, rent seeking and entitlement; and, socially, it fosters insecurity as host communities are now militantly unwilling to accept a continuation of fiscal oppression.

The Northern lawmakers should drop their opposition and indeed, lawmakers from all six geopolitical zones should move quickly and pass the bill. Thereafter, they should press for the immediate exploitation of solid minerals that are available in all the 36 states in line with the PIB principles to foster federalism, stimulate industrialisation, boost exports, create jobs and reduce poverty.

For a nation that is dependent on oil revenues for 90 per cent of its revenues, the PIB is too important to remain mired in the divisive politics of resource-sharing that has made a mockery of our federal status and held back investments in the sector. This insufferable arrogance must be discarded.