Economy

Subsidy removal: Nigerians may buy petrol at N1000 per litre

Eyewitness reporter

There seems not to be a respite for Nigerians from the oppressive economic situation in the country as they may likely buy a litre of Petroleum Motor Spirit (PMS) otherwise known as petrol at N1000 when the Federal Government eventually removes subsidy on the product.

It could be recalled that the Nigeria National Petroleum Corporation (NNPC) has severally complained that the present prices of the product are no longer sustainable as the fuel subsidy is eating deep into the corporation’s remittances into the federation account.

On the same breathe, the Minister of State for Petroleum Resources,Timipre Sylva has said that the government was determined to remove subsidy on Petro to free enough funds for other developmental projects.

However, the Department of Petroleum Resources (DPR), has warned that the removal of subsidy may push the price of petrol to as high as N1000 per litre if there was no alternative source of energy.

DPR Director, Sarki Auwalu, who stated this while responding to questions and comments generated by a paper he delivered in Lagos, acknowledged that Nigeria was spending so much on petrol subsidy.

Responding to the subsidy concerns and the disparity in the petrol consumption figures given by the Nigerian National Petroleum Corporation (NNPC), and the DPR, Auwalu acknowledged that Nigeria was spending so much on petrol subsidy.

He said eliminating it would require making alternative fuel available to Nigerians and that failure to do that could plunge Nigerians into paying higher petrol prices when subsidy is removed.

According to a statement by DPR titled ‘DPR: Without Alternative Energy, Petrol Price Will Rise On Subsidy Removal’, Auwalu stated that Nigerians may pay as high as N1, 000 to buy one litre of petrol in the country when subsidy on petrol is removed and when the alternative energy or autogas gas policy becomes fully operational.

He, however, said the alternative fuel regime comes with initial cost as it will lead to spending $400 to convert one vehicle from running on petrol or diesel to running on either Liquefied Natural Gas or Compressed Natural Gas.

Auwalu maintained that converting eight million public vehicles currently present in Nigeria to gas-powered will cumulatively cost $3.2 billion to achieve.

He said, “So, to eliminate subsidy, they don’t call it subsidy anymore now, it’s under-recovery of purchase.

“So, to eliminate under-recovery, what you need is alternative fuel. Without an alternative, you will subject people to higher prices and that is why we go for price freedom.

“As at today, there are 22 million cars in Nigeria. Eight million are for public use. Imagine if you want to convert every car into gas, the average cost of conversion is $400. Converting eight million cars requires $3.2 billion.

“To do that, there are a lot of environmental investors which can invest and recover from the sale of gas and we are encouraging that.

“Once that is achieved, you will see that PMS can be sold at N1,000. After all, the average distance covered by one-gallon equivalent when you compare it with LNG or CNG with respect to energy for mobility is 2.7 against one. One for PMS, 2.7 for LNG or CNG.

”So, with that advantage, you will see that it creates an opportunity for this industry again. The issue of subsidy, the volume will all vanish and that is what we are working towards.”

Economy

Court reverses self over contempt charge against Fidelity Bank chief

Managing Director of Fidelity Bank,Nneka Chinwe Onyeali-Ikpe

The Eyewitness reporter

A Chief Magistrate Court sitting in Ikeja, Lagos has vacated its ruling that convicted and sentenced the Managing Director of Fidelity Bank,Nneka Chinwe Onyeali-Ikpe and Company Secretary of Fidelity Bank, Mrs. Unuigboje Ezinwa to six weeks in prison or a fine of Four Hundred Thousand Naira respectively for contempt.

The Chief Magistrate, Mr. Lateef Owolabi vacated the order in a Suit No: MIK/4726/22 between Justin Ahmed, (judgement creditor), Prince Enabulele Osazee, (judgement debtor) and Fidelity Bank Plc, (1st Garnishee/Applicant).

The court, in an earlier ruling delivered on February 6, 2023, held that the Managing Director of Fidelity Bank, Nneka Chinwe Onyeali-Ikpe and the Company Secretary, Mrs. Unuigboje Ezinwa should be committed to six weeks’ imprisonment over alleged disobedience of a garnishee order of the court restraining the bank from allowing a judgement debtor access to his account.

However, at the resumed proceedings on the matter on Feb 15, 2023, the court vacated the committal order on the premise of facts presented before the court that the alleged acts of contempt were not deliberate but arose out of a communication gap between the said parties and the erstwhile counsel.

The court in its ruling also stated that the error or sin of the counsel should not be visited on a party or litigants. The court also noted that the monies that were the subject matter and fulcrum of the contempt proceedings have since been paid to the judgment creditor.

“From the materials presented before this court by the applicant, this application falls within the classic rule where the error or sin of the counsel should not be visited on a party or litigants. Moreover, the applicant has averred that the monies subject matter, the fulcrum of the contempt proceedings had since been paid to the judgment creditor.

”Having fully discharged this payment to the satisfaction of the judgment creditor, this court should not be seen to cry more than the bereaved”, Mr Lateef Owolabi held.

”The solicitor to the bank explained that Fidelity Bank, being a law-abiding institution that will never or under any circumstance, directly or indirectly denigrate the integrity of the nation’s judiciary, had upon receipt of the garnishee order nisi on December 22, 2022, conducted a search immediately, and the result showed several accounts bearing similar names to the Judgment Debtor’s (Prince Enabulele Osazee).”

”To prevent the bank from erroneously restricting the wrong account, the bank filed an affidavit requesting additional account details to enable it to ascertain the correct account(s) to restrict.”

He further stated that, on January 16, 2023, the bank received the Judgment Creditor’s affidavit showing the account number of the Judgment Debtor. Armed with the correct account number, the bank immediately identified and placed a lien on the Judgment Debtor’s account. Unfortunately, during the intervening period, the judgement debtor had carried on depositing and withdrawing from his account.

In vacating the order on February 15, 2023, the Chief Magistrate held that based on the materials before the court, the applicant has been able to tether the law to the facts to warrant the grant of the relief sought on their own strength and not based on lack of opposition.

Economy

Supreme court restrains FG from enforcing naira swap deadline

The Eyewitness reporter

There was a temporary relief for Nigerians over the scarcity of naira notes as the Supreme Court has issued an order of interim injunction restraining the Federal Government and the Central Bank of Nigeria (CBN) from enforcing the February 10 deadline for the phasing out of the old naira notes.

A five-member panel of the court, led by Justice John Okoro said that it was a matter of urgent national importance that the court intervenes and grant the order.

The ruling was on an ex-parte motion filed by the governments of Kaduna, Kogi and Zamfara states

The order, according to Justice Okoro, who read the lead ruling, is to subsist pending the hearing and determination of the motion on notice filed by the state for interlocutory injunctions.

The court adjourned till February 15 for the hearing of the motion on notice and the preliminary objection filed by the defendant – the Attorney General of the Federation (AGF), challenging the court’s jurisdiction over the case.

Economy

CBN succumbs to pressure, extends use of old naira notes to February 10

The Eyewitness reporter

The Central Bank of Nigeria (CBN) has finally caved in to Public outcry over the February 1st deadline for the use of old naira notes when on Sunday, the apex bank announced February 10 as the new date.

Announcing the new deadline in a statement, Governor Central Bank Of Nigeria(CBN), Godwin Emefiele, said the decision to add extra 10 days was “to allow for the collection of more old notes”

Up till Saturday, CBN had insisted on the 31st January deadline for the validity of the old N200, N500 and N1,000 despite overwhelming complaints that the notes are either not available or in short supply in the banks or their Automated Teller Machines.

Last October, Emefiele announced the Naira redesign policy which entails the issuance of new notes to replace the existing N200, N500 and N1,000 series.