Buhari's 2017 Budget Shows Hatred For Education - ASUU

Reacting to President Buhari’s budget statement that no provision was made for Joint Venture, JV, cash calls from January, 2017, Chambers Oyibo, former Group Managing Director of Nigerian National Petroleum Corporation, NNPC, said it is in line with what the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, earlier stated about having alternative funding.

Oyibo, who is also Chairman, Prime Energy Resources Limited, said: “It is in line with what the Minister of State said earlier that there should be alternative means of funding in the sector. In fact, he talked about having incremental production agreement with the international oil companies, IOCs. The idea is to fast-tract the funding mechanism such that it does not have to go through the National Assembly for approval.

“As regards predicating the budget on oil price of $42.5 per dollar, I think it is realistic, based on the agreement reached between OPEC and non-OPEC members recently,” he added.

Dolapo Oni, Head Energy Research, Ecobank Development Company Limited, believes that the signing of the agreement with the IOCs, will ensure that Nigeria has no more cash call liabilities. According to him, “there’s a small payment that’s meant to be made first, I believe that must have been included in the budget to ensure the deal goes on. However, I believe it is a good deal for Nigeria to have the JVs able to self-fund and raise capital for their businesses. However, don’t forget we could potentially find that we earn lesser from our oil as the new structure will ensure that funding of repayment and future capital expenditure have first claim on revenues unlike before when we just get all the revenues.