PRESS STATEMENT

MINISTRY OF PETROLEUM RESOURCES ENDS 2016 ON A HIGH AS KACHIKWU SIGNS LANDMARK AGREEMENT

NEW CASH CALL POLICY INCREASES FG’S ANNUAL REVENUE BY $2B

…IOCs AGREE TO ARREARS REPAYMENT FRAMEWORK AS NET REVENUE IS EXPECTED TO INCREASE TO $14B BY 2020

In a move which will restructure the financing template for oil earnings, increase investments and boost government revenues, the Minister of State, the Federal Government has reached agreement on a new cash call exit policy with the international oil companies (IOCs).

The historic agreement which will bring clarity and stability to the management of the country’s main revenue source was announced by the Minister of State, Petroleum Resources while giving an account of key achievements of the Ministry in 2016 yesterday has already received the approval of the Federal Executive Council.

It is part of new measures and strategies aimed at eliminating the burden of Joint Venture Cash Call arrears and securing future funding for the Upstream Petroleum Sector.

These strategies which are fully supported by the National Economic Council (NEC) will lead to an increase in national production from the current 2.2mbpd to 2.5mbpd by 2019, as well as reduction in Unit Technical Costs from $27.96/Barrel Oil Equivalent (boe) to $18/boe.

The net payments to the Federation Account is expected to double from about $7Billion to over $14Billion by 2020 and the immediate effect of the new cash call policy will increase net FGN Revenue per annum by about $2billion.

Dr. Kachikwu outlined other innovations and initiatives championed by the ministry over the past year which have revamped the sector, restored investors’ confidence which was at an all-time low and positioned Nigeria’s Oil and Gas value chain for profitability.

It would be recalled that based on historical records, the current Cash Call system has been structurally defective and has failed to address the perennial Joint Venture funding challenges being experienced in the industry where the Federal Government underfunding of the industry through JV Cash Calls stood at $9.125 billion by September 2016. This arrangement will guarantee payments of statutory Oil and Gas Royalties and taxes by NNPC and its JV partners as well as profit from its investments in the Joint Ventures.

At US$42.5 per barrel Oil price which the 2017 budget is predicated on and US$24 per barrel fiscal cost recovery proposed for 2017 in FGN Medium Term Expenditure Framework (MTEF) recently submitted to NASS, over US$13 per barrel will accrue to Government as Royalties & Taxes from Joint Venture Oil and Gas Production apart from US$2.8 per barrel estimated as Government share of profit, at 57% equity.
This will restore investors’ confidence and achieve accelerated production growth in the Joint Ventures. New Governance processes will also be introduced.

The negotiation on behalf of the Federal Government of Nigeria which was led by Dr. Kachikwu resulted in a remarkable agreement by the IOCs who have agreed to be paid their accumulated arrears up to December 2015, payable over the period of about five years. It is important to note that this will not be a cash burden on the Federal Government as payments will be made via incremental production from each JVC.

Aside this key agreement on Joint Venture Cash Call Arrears Payment and Future Funding Mechanism signed today, it would be noted that under the stewardship of Dr. Emmanuel Ibe Kachikwu as Minister of State for Petroleum Resources and leadership of President Muhammadu Buhari, the Ministry has also made considerable accomplishments in the international frontiers through maintaining robust relationships and strengthening linkages within and outside the petroleum producing community.

Achievements recorded in 2016 include the following:

1. Successful tenureship and handover of the Presidency of four key international energy organisations namely:
- The Gas Exporting Countries Forum (GECF)
- Organisation of Petroleum Exporting Countries (OPEC);
- African Petroleum Producers Association (APPA); and
- West African Gas Pipeline Authority (WAGPA).

2. Successful election of Mohammed Sanusi Barkindo of Nigeria as  the Secretary - General of the OPEC

3. Successful mobilization of OPEC members and Non-OPEC Oil Producers to dialogue on the stabilization of the global market in Doha; Algiers which culminated into the achievement of freeze on production at the 171st conference in Vienna

4. Rise in oil prices to US$55/per barrel for the first time in 16 months after negotiations with non-OPEC producers

5. Nigeria's successful negotiation of an exemption from the production freeze;

6. Successful hosting of the 52nd Conference of Ministers of African Petroleum Producers Association in March 2016 (APPA);

7. Provided leadership and support to other APPA members in the development of legislation, institution and systems for local content in Africa

Finally, The Minister of State pledged that the Ministry will continue to drive innovation and change in its approach to delivering an oil and gas industry that is internationally competitive and is governed by open and transparent processes to ensure security of investment for both domestic and international investors.

Idang Alibi
Director, Press
Ministry of Petroleum Resources
December 15, 2016

cc; Lalasticlala,mynd44

Source: http://www.trezzyhelm.com/2016/12/ibe-kachikwu-signs-joint-venture-cash.html?m=1

Read more http://www.trezzyhelm.com/2016/12/ibe-kachikwu-signs-joint-venture-cash.html?m=1

God Bless Nigeria
God Bless Baba Buhari
God Bless Kachikwu
God Bless Nigerians
.
.
except MMM

modified*
the poster below me.

To build good roads ?? (YES)
To feed the poor ?? (YES)
To provide 24 hour electricity ?? (YES)
To better the economy ?? (YES)

so get the fvcck out of here....

They can increase the revenie by 100B nothing will change

Really? Thanks to shell o. Hope u guys will now pay our November salary

Love him or hate him, this Kachiku dude is working

Ok

Ok oo. More money for Kyari to use in clearing grass

That's good. Let's wait and see how it will unfold.

I hope the deal is for the oil discovered in Bornu , Benue and Lagos.

Kachikwu the Best Minister Minister under an Incompetent President
Kudos to Kachikwu....

mccoy47:
Ok oo. More money for Kyari to use in clearing grass

Including Babachir Lawal and Buratai

Sign the agreement and begin to make our LOCs (Local Oil Companies) as alternative to them come 2021. Nice move sha

we will get there gradually only when our leaders becomes selfless

Kachikwu remains the best brains in buhari "party of fools" government

Hus achievements are outstandingly innovative. It is a testament to his pure genius and his ExxonMobil background.

The only relentless Working minister

Good move by the federal government

It's not the issue.. After increasing the revenue and there are still bad roads, no industries to absorb the millions of corpers every year and one person will loot trillions of naira.

God help Naija.

MMM 2017 loading...

The only meaningful thing I'm seeing on their 7-point achievement are just the 3rd and 5th point. Number 4 is a fallout of number 3 so both are meant to be on the same line.

Others are quite useless.

Being elected as OPEC sec gen doesn't add anything to anything, Dieziani was elected OPEC chairman too yet nothing happened.

Hope the New JV cash call or whatever jargon there are using is worth it for the masses.

AnusOdourInhaler:
Love him or hate him, this Kachiku dude is working

Yes because he is a good fit for his profile. He is an Harvard law graduate who specialisation is in oil and gas. So he was able to understand the language of oil production and marketing and matched the IOCS executives' intelligence.

They had no choice than to come to terms with him. FG should look into qualification when appointing people to Ministries.

Mayflowa:


Yes because he is a good fit for his profile. He is an Harvard law graduate who specialisation is in oil and gas. So he was able to understand the language of oil production and marketing and matched the IOCS executives' intelligence.

They had no choice than to come to terms with him. FG should look into qualification when appointing people to Ministries.

That's it.. You have said all

AfonjaStinks:


[s]Useless

What will the money be used for ??

To build good roads ??

To feed the poor ??

To provide 24 hour electricity ??


To better the economy ??

Fucck out of here with that bullshit

[/s]

Exactly useless

#KACHUKWU. The best and the only good thing that comes out of this present government. He not only knows how fix himself up ( wardrobe sense) he also, among other things, knows how to cut good deal.

I hope the money gotten from here wouldn't be used for some persons honeymoon. I no mention name oo

Me chairman, Me MD and Me General Manager Finance( baba lefty) i see you guys.

Glocks:
The only relentless Working minister

Wow, some of you are just myopic and unnecessarily petty.

Kachiukwu, Adeosun, Aminah Muhammed, Ameachi and Fashola are workaholic in this govt. And they are so because of the president they're working under.

Where are Avengers when we need them.

Atiku2019:
Kachikwu the Best Minister Minister under an Incompetent President

Kudos to Kachikwu....

Dice it whichever way you like, Kachiukwu and other performing ministers are a product of PMB and whatever they do must have received PMBs approval.
So, stop being childish and petty.

Some of you act like stark illiterate.

Hopefully Total/NNPC awardees can now be paid.

This life sha...

A few moons ago many here wanted to kill Kachikwu when there was that wicked Fuel scarcity...

many called him all sorts of names that even Tinubu called for his Removal but PMB did not listen to them all...

How Time Flies!!

Kudos to kachikwu!!

Kudos to PMB!!!

I thought Kachikwu is an errand boy and the gmd of NNPC is more important. Ignorance is a disease