FG plans to sell 5% of its NLNG shares …insists on repurchase option

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Eniola Akinkuotu, Abuja

The Federal Government is planning to sell at least
five per cent of its shares in the Nigeria Liquefied
Natural Gas company,
Impeccable sources in the Presidency said that the move had become
necessary as part of efforts to revive the ailing
economy.
A top official, however, explained that the Federal
Government had no plan to sell its shares in the
NLNG outright.

The Federal Government currently owns 49 per
cent shares in the company, while private firms
own the remaining 51 per cent.
A Presidency source said, “The Federal
Government is open to the possibility of selling
down its 49 per cent ownership by five per cent or
thereabouts.”
But the source said the decision had yet to be
finalised.
The source added that as in other potential assets
sales, there would be a repurchase option that
would guarantee the Federal Government an
opportunity to buy back such assets if
circumstances changed anytime in the future.
Officials told our correspondent that the intention
of the Federal Government was to raise between $
10bn and $15bn from assets sale.
This is said to have become imperative as the
monthly foreign currency earnings of the country
have dropped drastically to as low as about $300m
in some months this year.
Besides, the government has been losing about
one million barrels of crude oil per day to
vandalism of oil and gas pipelines and
installations.
The Presidency source said the Federal
Government had not made up its mind on all the
assets it intended to sell but promised that the
process would be transparent.
He added that some of the assets would be sold
through the Nigerian Stock Exchange.
The source added, “Some of the intended sales
could be in form of time-bound leases, advance
renewal payments on leasing licences and
concessions, which will attract buoyant signature
fees.
“If we even want to sell certain assets, while our
target is to get foreign currencies, specifically
dollars, the option will also be opened to Nigerians
at some point to buy limited shares through the
Nigerian Stock Exchange.”
He revealed that a concession deal was almost
completed already.
He added, “We are entering into some concessions
like that of the East-West lines of the Nigerian
Railways. General Electric will be the
concessionaire, and for which the global giant will
invest $2bn in the Nigerian economy, including for
the refurbishment of the single-gauge lane of the
lines that have been largely left idle for years.
“GE, under the deal, is expected to hire back some
of the laid-off staff of the Nigerian Railway
Corporation, and also open a Transport University
in Nigeria, while building and assembling train
coaches here in Nigeria.
“Under the deal, the government will also receive
signature fees in foreign currencies as it would in
other assets that will be subjected to concession.
“The important thing to keep in mind is that the
sale of some of the assets is an option to raise the
much needed dollars at a critical time for the
Nigerian economy.”

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