A Review of the Nigerian Energy Industry

Financial market update

finance30 May 2013, Sweetcrude, Lagos – Local and international financial market products and services update.
NIGERIA: The World Bank and its subsidiary, the International Finance Corporation, IFC, on Tuesday announced plans to invest about $1 billion (N159 billion) in Nigeria’s energy sector in the next couple of months. Speaking at the Nigerian Institute of Management’s, NIM, Corporate Leaders Forum in Lagos, Marie Francois Marie-Nelly, World Bank Country Director, Nigeria, said the investments will be in terms of Partial Risk Guarantees for gas supply and Independent Power Plants valued at $800 million and $200 million respectively.

EUROPE: European stocks were little changed, after the benchmark Stoxx Europe 600 Index yesterday dropped to a three-week low, as investors awaited U.S. data on house sales and economic growth. The Stoxx Europe 600 Index added 0.2 percent to 302.95 at 8:25 a.m. in London. The Stoxx 600 dropped 1.9 percent yesterday amid concern in the U.S. Treasury market that the Fed will begin to taper bond purchases as the world’s largest economy strengthens.

INDIA: Most Indian stocks fell, paring a monthly advance, as earnings of some of the biggest companies lagged behind estimates and as regional equities declined. Two stocks declined for every one that rose on the S&P BSE Sensex, which retreated 0.1 percent to 20,119.51 at 12:10 p.m. in Mumbai.

CHINA: China’s economy is proving less responsive to credit, escalating pressure on Premier Li Keqiang to strengthen the role of private enterprise. The government’s broadest measure of credit rose 58 percent to a record 6.16 trillion yuan ($1 trillion) in January-to-March, when gross domestic product gained 7.7 percent, compared with 8.1 percent a year earlier.

Bonds – Correction in the markets on Tuesday with yields up an average 10bps on the long end. Weak offshore interest in the long end of the curve in the last week.

Bills – Quiet session on Tuesday, rates coming off as demand steadily trickles into the market. Expectation is that with the maturity on Thursday rates will drop lower and the CBN will also come out to offer OMO and try and mop up some of the liquidity.

Money Market – OBB and unsecured O/N rates closing on Tuesday at 11.50% and 11.75%. The CBN came out to offer N40billion in OMO bills on Tuesday but failed to make any sale as market liquidity levels are already quite low.

Indicative Currency Exchange Rates
Bid         Offer

EURUSD       1.2966     1.2976
GBPUSD       1.5160      1.5170
USDJPY        100.73     101.13
USDCHF       0.9589    0.9609
GBPEUR       1.1692      1.1702
USDZAR       9.8045    9.9045
USDNGN      157.85     158.60
JPYNGN       1.5671      1.6171
CHFNGN      164.62     168.62
EURNGN      204.67    208.67
GBPNGN      239.30     243.30
ZARNGN       16.10        18.10

Brent futures rose toward $103 a barrel on Thursday as the dollar weakened, regaining ground from their biggest slide in almost a month the day before.

Interest rates
NIBOR (%)                       LIBOR (%)

O/N              13.2083           USD 1 month        0.1937
7 Day            13.5000           USD 2 month       0.2310
30 Day         13.7083            USD 3 month       0.2757
60 Day         14.0000           USD 4 month       0.3181
90 Day         14.2917            USD 6 month       0.4162
USD 12 month      0.6907
Y/Y Consumer Inflation April 2013 :              9.1%
FX Reserves: 22 May 2013 (USD bn)            48.432
MPR                                                                      12.00%

Source: Reuters, Bloomberg, Central Bank of Nigeria, Financial Market Dealers Association Standard Chartered Bank Nigeria.

                             Hi            Low            Close         Prev.Close
USD/NGN  158.44/54      158.15/25    158.35/45   158.05/15

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