₦airaland Forum

atlwireles:
There is no over production of oil. Let's bury that lie, this is a market share war. OPEC woke up to the game.

You are definitely right. But with this, oil prices will go down further.

ducii:
I agree with you 100%, and take that bloody subsidy while you are at it

Agreed also
Nigeria needs the oil and gas industry only for savings and to build up force reserves.
Our real wealth is in agriculture, agro allied, solid minerals including the many of the kinds of strategic minerals found only in Congo, Tanzania and South Africa.
21st and 22nd century minerals.

The only reason we cry about crude oil prices is because of government spending. The question is why is a Nation like Nigeria beholden to Oil prices? When oil is just $97B of our $520B GDP.

Boss13:
You are definitely right. But with this, oil prices will go down further.

Hedge funds are covering their short positions in the market. The price has nothing to do with oil glut.

Adminisher:
Have you seen the operations in North Dakota?. I drove past there one year ago. It is no frills high tech operations by independent producers. Very dynamic, entrepreneurial people, almost like Nigerians. A guy borrows money from the bank, drills using good data, and starts small scale production and is making only a margin of $20 a barrel but he is happy because he is a multi millionaire in three months already. There are now thousands of those entrepreneurs in the industry. Shale Oil and gas is mostly not for the oil majors yet although some are investing in it as well. The oil majors will lock in production and low oil price but the small scale independent oil producers I'll keep pumping. OPEC countries too have a price cut off, for Saudi Arabia I think it is $20 but they will pretend it is not so. For Nigeria anything below $40 is going to be very painful.

Shale oil is only booming because of oil price around a $100. Keep prices at this level as they now, and those technology you see in North Dakota as you said will be wilderness in 9 months. Ask the towns in Western Texas what $30 oil did to them in the 1980s.

Also most of cost factored into Nigerian oil is a security premium, that's why you have $20-$40 spread.

atlwireles:
There is no over production of oil. Let's bury that lie, this is a market share war. OPEC woke up to the game.

Do you even remotely understand how the markets work?

ISpiksDaTroof:
Do you even remotely understand how the markets work?

My Washington DC taxi driver finally shows his tiger clawed face. Please keep your eyes on the road.

Another problem for Nigeria is that our competitors and customers are on an import substitution strategy. The US is not interested in exports of oil and gas even though they have started competing with us in LNG. What they want is a strategy to add value typically to petrochemical and for the first time in years, refineries in Texas have been having cheaper raw material coming from just next door the the Dakota's and Utah.
So Nigeria is competing with people who don't have to put oil on tankers to send abroad to the customers. Logistics cost savings alone will keeps the price differentials interesting. Advanced economies like Russia and US competing in the oil sector is very bad for us. Putin himself has started intense economic diplomacy this week to Turkey and India.

I think ATlwireles is mostly right in what is writing. what we could also see is a lot of consolidation with the majors buying out the small timers and allowing the prices to rise again.

Price beats Technology anytime ... it is simple economics

Adminisher:
Another problem for Nigeria is that our competitors and customers are on an import substitution strategy. The US is not interested in exports of oil and gas even though they have started competing with us in LNG. What they want is a strategy to add value typically to petrochemical and for the first time in years, refineries in Texas have been having cheaper raw material coming from just next door the the Dakota's and Utah.
So Nigeria is competing with people who don't have to put oil on tankers to send abroad to the customers. Logistics cost savings alone will keeps the price differentials interesting. Advanced economies like Russia and US competing in the oil sector is very bad for us. Putin himself has started intense economic diplomacy this week to Turkey and India.

Sorry to disagree the reason why Cheniere energy exploded from 2 dollar to 93 dollar per share just a few years was their completion of the first gas export terminal in Lousiana. LNg usage round the world is expected to grow in the next decade driven by the clean energy companies.

Adminisher:
Another problem for Nigeria is that our competitors and customers are on an import substitution strategy. The US is not interested in exports of oil and gas even though they have started competing with us in LNG. What they want is a strategy to add value typically to petrochemical and for the first time in years, refineries in Texas have been having cheaper raw material coming from just next door the the Dakota's and Utah.
So Nigeria is competing with people who don't have to put oil on tankers to send abroad to the customers. Logistics cost savings alone will keeps the price differentials interesting. Advanced economies like Russia and US competing in the oil sector is very bad for us. Putin himself has started intense economic diplomacy this week to Turkey and India.

Nigerians will compete with the US, when freeloaders crying for petrol subsides understand the world outside Nigeria. Even the gas sold today to GENCO has to be subsidized by NNPC, because the distribution companies cannot pass the cost over to end users.

Success in business is not an accident, you plan and work for it. The Nigerian local energy market is untapped. Largely, because of parasitism in Nigeria. Nobody is going to invest in a market, where some bureaucrat sits in an office trying, to control both his pricing power and profit.

Where did they get their facts from that the US shale oil boom won't last? The us has an estimate 4.8 trillion barrels of shale oil deposits so tell me how that's gona deplete so soon? The reason why us is still buying saudi's crude oil is because the quality is lower than the one produced in nigeria, hence they prefer buying low quality oil at a cheap price. Nigeria has stopped selling crude oil to the us since the beginning of this year. So basically the petrol we getting is what we send to us to refine and send back at a high price. Just like in the case of cocoa in other african countries.

prettyboi1989:
Where did they get their facts from that the US shale oil boom won't last? The us has an estimate 4.8 trillion barrels of shale oil deposits so tell me how that's gona deplete so soon? The reason why us is still buying saudi's crude oil is because the quality is lower than the one produced in nigeria, hence they prefer buying low quality oil at a cheap price. Nigeria has stopped selling crude oil to the us since the beginning of this year. So basically the petrol we getting is what we send to us to refine and send back at a high price. Just like in the case of cocoa in other african countries.

What are you talking about

atlwireles:
The only reason we cry about crude oil prices is because of government spending. The question is why is a Nation like Nigeria beholden to Oil prices? When oil is just $97B of our $520B GDP.

It's because nigeria has one of the worst tax frameworks on the planet. Taxes in nigeria only make up 3% of govt revenue. (The average in subsaharan Africa is 9% and the average in the developed world is 30%)

davitogreat:
It's because nigeria has one of the worst tax frameworks on the planet. Taxes in nigeria only make up 3% of govt revenue. (The average in subsaharan Africa is 9% and the average in the developed world is 30%)

People seeking development without wanting to pay for it. Thanks OP.

senators,govnors,HOR,president..next year u beta cut ur magnified salaries..

prettyboi1989:
Where did they get their facts from that the US shale oil boom won't last? The us has an estimate 4.8 trillion barrels of shale oil deposits so tell me how that's gona deplete so soon? The reason why us is still buying saudi's crude oil is because the quality is lower than the one produced in nigeria, hence they prefer buying low quality oil at a cheap price. Nigeria has stopped selling crude oil to the us since the beginning of this year. So basically the petrol we getting is what we send to us to refine and send back at a high price. Just like in the case of cocoa in other african countries.

Crude oil is not just about petrol or gasoline for transportation. Virtually every industrial activity has connection to crude oil. And the different grades of crude supplies varying needs of the industry. In other words there is nothing like a "high or low" quality crude. What matters is the product that can be obtained from it.

I think in my opinion, in moments like this government had to look out for solution. One of which is the total removal of oil subsidy. Cut government overbloated expenditure by possible merging Agencies and Parastatal with overlapping functions. Taxes too must be taken seriously more especially on luxury goods.

MOD move this to FP very educative

The solution is right there in the just concluded national conference. The present turmoil in the polity present a good opportunity for the president to implement it.
1. Use all the "constitional" means at his disposal to force the speaker out and present a friendly one who will work on the "needful" to get a referendum in the constitution.
2. Get a referendum going on the need for either passing and adopting the conference or call for a new constitution.
The conference did a lot cut the government and governance cost.

How government is funded is the solution we need. The how much does not worry me, as long as the how is redefined.We have to stop depending on one commodity, in a Nation of 170M people. The Nigeria state has to move from sharing wealth to creating wealth. The size of the cake is only getting smaller

The price of crude oil should not be a problem for us, if the funding of government was well structured. Nigeria energy consumers ought to be reaping the harvest of cheap oil prices, but our failed energy policy is denying us that chance.

davitogreat:
It's because nigeria has one of the worst tax frameworks on the planet. Taxes in nigeria only make up 3% of govt revenue. (The average in subsaharan Africa is 9% and the average in the developed world is 30%)

Even if we pay taxes that make up 30% of revenue government spending and corruption will still deal with it leaving next to nothing for the citizenry. no be this same Nigeria again?

obinoscopy please move to front page

crudedude:
Even if we pay taxes that make up 30% of revenue government spending and corruption will still deal with it leaving next to nothing for the citizenry. no be this same Nigeria again?

obinoscopy please move to front page

Corruption will be better checked when people actually feel the direct impact of government cost. Just imagine 40 million Nigerians withdrawing monies from their bank accounts and paying taxes directly to FIRS yearly. Both the quality of our civil service and the people we elect will change overnight.

atlwireles:
My Washington DC taxi driver finally shows his tiger clawed face. Please keep your eyes on the road.

Hunger is about to destroy you by next year. Gej will still fly in Private Jets and eat billion naira meals none of your lineage will ever get to taste.

atlwireles:
Corruption will be better checked when people actually feel the direct impact of government cost. Just imagine 40 million Nigerians withdrawing monies from their bank accounts and paying taxes directly to FIRS yearly. Both the quality of our civil service and the people we elect will change overnight.

Corruption can be curtailed considerably only when the polity is restructured in such a way to hold citizens accountable for their actions or in actions including non tax payment.

.Interesting Post.

atlwireles:
Nigeria is diversified already. Nigerians need to start funding government from other sources. In an economy of $520B, why is crude oil responsible for 80% of government spending.

I disagree with you.


Pls mention other diversified products we export to get dollars.

atlwireles:
Corruption will be better checked when people actually feel the direct impact of government cost. Just imagine 40 million Nigerians withdrawing monies from their bank accounts and paying taxes directly to FIRS yearly. Both the quality of our civil service and the people we elect will change overnight.

Correct talk.... People will actually see and feel their contributions. The fear of an engaged citizenry will put real and imminent fear in the corridors of power.

davitogreat:
It's because nigeria has one of the worst tax frameworks on the planet. Taxes in nigeria only make up 3% of govt revenue. (The average in subsaharan Africa is 9% and the average in the developed world is 30%)

You want to tax an economy filled with lots of poor people and struggling businesses.

crudedude:
Even if we pay taxes that make up 30% of revenue government spending and corruption will still deal with it leaving next to nothing for the citizenry. no be this same Nigeria again?

obinoscopy please move to front page

may God almighty bless you, I wonder what this guy is saying, he must be a politician. The masses and the populace would pay heavily for this thieves excesses, in fact there should be no remittance of tax in nigeria with the rate of corruption and impunity. Mtcheww

davitogreat:
It's because nigeria has one of the worst tax frameworks on the planet. Taxes in nigeria only make up 3% of govt revenue. (The average in subsaharan Africa is 9% and the average in the developed world is 30%)

checkmate, annihilate corruption, scrap overlapping agencies, reduce cost of governance before you talk of further impoverishing the masses all in the name of taxation and lets see where we would be

Adminisher:
DON'T FOOL YOUR SELF THAT SHALE OIL WILL GO AWAY, AMERICANS ARE THE MOST INNOVATIVE PEOPLE ON EARTH.
The problem with Shale Oil and Gas is that it is drilling intensive. You need drilling almost every six months which is expensive. However Americans and Canadians are spending money on 'smart wells', well analytics and the complete digitisation of surface and subsurface production. American ingenuity will reduce the cost of production by $25 per barrel in th next three years I am sure. OPEC should be careful and a country like Nigeria governed by idiots should be even more careful. Oil price will NEVER EVER exceed $80 per barrel again. This are the dying embers. Nigerians need to hold their government accountable and force the oil money into productive sector that will start making a difference now. 2015 should be a year of strikes to make sure money flows into productive sectors. All the conspicuous consumption and private jet buying should be taxed painfully. Youths must have jobs, the young must be educated. American bashing will not help us, let us take our governments to the grinder.

Who are the ones striking when ASUU, NMA, NUT all want salary increase. All civil servants, even the unemployed youth want financial benefits, where is the money the govt would channel to order sectors. Nigerians are the cause of their problems