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Oil earnings fall short by N16.2tn

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Despite an improvement in crude oil production, the Federal Government earned 63.49 per cent less than its projected oil revenue target in the first half of 2025, according to the second quarter Budget Performance Report released by the Budget Office on Monday.

The report showed that gross oil revenue of N9.32tn was recorded between January and June 2025, far below the N25.52tn pro-rated budget projection for the period. This translated into a N16.20tn shortfall, underscoring the persistent fragility of Nigeria’s oil-dependent fiscal structure.

Data from the report also indicated that average crude oil production stood at 1.68 million barrels per day, below the budget benchmark of 2.12mbpd, with significant revenue implications for the Federation Account.

However, output improved marginally compared with earlier periods, rising by 0.08mbpd from the 1.6mbpd recorded in the first quarter of 2025 and by 0.27mbpd above the 1.41mbpd produced in the corresponding period of 2024.

Despite missing its revenue target, the half-year performance marked a notable improvement year-on-year, as oil revenue increased by N2.78tn, or 42.59 per cent, compared with the actual half-year earnings recorded in 2024.

The report read, “Gross oil revenue amounting to N9.32tn was collected in the first half of 2025 as against N25.52tn prorate budget projection for the period. This denotes a decrease of N16.20tn (63.49 per cent) from the 2025 half-year budget estimate. It, however, reflects an increase of N2.78tn (42.59 per cent) from the actual half-year gross oil revenue performance reported in 2024.”

Crude oil has remained Nigeria’s single most important source of foreign exchange and public revenue for over five decades, accounting for about 80–90 per cent of export earnings and more than half of government revenue in most fiscal years.

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Earnings from crude oil exports largely determine the country’s foreign exchange inflows, the strength of the naira, and the volume of funds available for distribution to the federal, state, and local governments through the Federation Account Allocation Committee.

These revenues are highly sensitive to international oil prices, production volumes, exchange rates, and fiscal terms, making government income vulnerable to external shocks.

Despite its dominance, Nigeria’s reliance on oil has exposed the economy to repeated fiscal stress during periods of price crashes or production disruptions. Challenges such as crude oil theft, pipeline vandalism, underinvestment, operational inefficiencies, and regulatory uncertainty have often constrained output and revenue performance, even when global oil prices are favourable.

A detailed breakdown of the figures revealed mixed outcomes across revenue lines. Concessional rentals surged to N24.82bn, exceeding the half-year projection of N2.06bn by N22.77bn (1,106.99 per cent), while miscellaneous oil revenue, including pipeline fees, rose to N29.73bn, beating its N11.72bn projection by N18.01bn (153.65 per cent).

In contrast, the major oil revenue streams significantly underperformed. Crude oil and gas sales generated N712.57bn, falling short of the N2.36tn target by N1.64tn (69.76 per cent). Petroleum Profit and Gas Taxes yielded N4.16tn, missing the projection of N15.69tn by N11.53tn (73.47 per cent).

Similarly, oil and gas royalties stood at N3.53tn, lower than the N6.86tn estimate by N3.33tn (48.54 per cent), while incidental oil revenue, including royalty recoveries and marginal field licences, came in at N438.90bn, undershooting its N591.76bn projection by N152.87bn (25.83 per cent).

The report also noted that gas flaring penalties and exchange gains, which had no half-year budget projections, contributed N267.25bn and N148.31bn, respectively, during the period under review.

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According to the Budget Office, oil revenue performance in the second quarter of 2025 improved compared with 2024 levels, largely due to higher crude output and improved collection of petroleum profit tax and royalties. Non-oil revenues also posted gains, attributed mainly to inflationary pressures and increased economic activities.

On pricing, Nigeria’s crude averaged $74 per barrel in Q2 2025, representing a marginal decline of $0.98 per barrel (1.31 per cent) from Q1 2025 and a sharper drop of $10.76 per barrel (12.69 per cent) compared with the corresponding quarter of 2024. The figure was also $1 below the $75 per barrel benchmark set in the 2025 budget.

Although production improved from 1.6mbpd in Q1 2025 and 1.41mbpd in the same period of 2024, the report highlighted that Nigeria’s oil sector continues to face deep-seated challenges, including crude oil theft, pipeline vandalism, weak security, underinvestment in infrastructure, regulatory uncertainty, and limited domestic refining capacity.

In the second quarter alone, gross oil revenue stood at N4.77tn, representing a N7.99tn (62.62 per cent) shortfall from the N12.76tn quarterly projection. Nonetheless, this was N1.59tn (33.33 per cent) higher than the N3.18tn recorded in the corresponding quarter of 2024.

On the non-oil side, gross non-oil revenue of N4.46tn was recorded in Q2, reflecting an increase of N404.26bn (6.68 per cent) above estimates. After deductions, the net distributable revenue available to the three tiers of government stood at N9.85tn, representing a shortfall of N7.01tn (41.58 per cent).

The figures reinforce ongoing concerns about Nigeria’s fiscal vulnerability amid oil market volatility, production shortfalls, and structural weaknesses, despite reforms introduced under the Petroleum Industry Act.

The report added that Nigeria’s oil sector continues to grapple with deep-seated challenges, including persistent crude oil theft, pipeline vandalism, and inadequate security, which have contributed to production shortfalls and supply disruptions. It noted that underinvestment in modern technology and infrastructure, corruption and regulatory uncertainties, as well as the country’s heavy reliance on crude oil exports, have continued to expose public finances to market volatility.

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It further highlighted concerns over limited domestic refining capacity, environmental degradation arising from gas flaring, and weaknesses in the fiscal and policy framework, despite the enactment of the Petroleum Industry Act. According to the report, sustained efforts to resolve legacy production issues and deepen reforms across key sectors of the economy remain critical to economic recovery and revenue stability.

Last week, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, opened up on Tuesday that the Federal Government recorded a significant revenue shortfall in the 2025 fiscal year. He noted that while the Federal Government projected N40.8tn revenue for this year, it ended up making only N10.7tn.

Edun made the disclosure while appearing before the House of Representatives Committees on Finance and National Planning during an interactive session on the 2026–2028 Medium Term Expenditure Framework and Fiscal Strategy Paper.

He recalled that the Federal Government had projected a revenue target of N40.8tn in 2025 to fund the N54.9tn “budget of restoration,” designed to stabilise the economy, secure peace, and lay the foundation for long-term prosperity. However, the minister said current fiscal performance shows that total revenue for the year is likely to end at about N10.7tn.

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Court orders Virgin Atlantic to pay N13m for missed flight

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A Federal High Court in Lagos has ordered Virgin Atlantic Airways Limited to pay Mrs. Joy Ezetah the sum of $5,906.50 in damages after it failed to allow her board a scheduled Lagos-London flight, an incident that disrupted her onward trip to Canada and caused her financial loss.

Justice Ibrahim Kala in the judgement delivered on Monday, held that the airline was liable for the losses suffered by the claimant after she was denied boarding at the Murtala Muhammed International Airport on 6 April 2024.

The claimant had asked the court for N100m in general damages, arguing that she bought a business-class ticket through Air Canada for a four-leg trip from Lagos to Toronto and back, but was stopped from boarding the Virgin Atlantic flight “without justification.”

She told the court that she arrived early, completed check-in, and was issued a boarding pass for the Lagos-London leg.

According to her, airline officials later prevented her from boarding, stating they could not connect her ticket to her Air Canada connecting flight from London to Toronto.

Ezetah stated that the airline owed her a duty of care and should have resolved the issue with Air Canada or made other arrangements instead of denying her boarding.

She further maintained that when she later contacted Air Canada, the airline confirmed that her ticket was valid and that she was expected on the connecting flight.

Virgin Atlantic, however, denied liability. It said it was “not the issuing carrier” and insisted that the ticket had been purchased directly from Air Canada under a codeshare arrangement.

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The airline also argued that an error code in the reservation system prevented it from issuing a boarding pass for the connecting flight and that it acted professionally by advising the passenger to contact the ticket issuer.

It further contended that the claimant’s inability to complete online check-in before arriving at the airport showed that there was already a problem with the ticket.

After reviewing the evidence, submissions and legal authorities cited by both sides, Justice Kala held that the claimant’s case had merit.

The court awarded $5,906.50 in damages against Virgin Atlantic and ordered that the sum be paid using the prevailing exchange rate published by the Central Bank of Nigeria. Based on the highest official rate of N1,365.50 to a dollar, the award translates to about N8.07m.

Justice Kala also ordered the airline to pay 10 per cent interest per annum on the judgment sum until full liquidation of the debt.

Additionally, the court awarded N5m as costs against Virgin Atlantic, noting that the claimant had been forced to approach the court to enforce her rights.

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States kick as Senate moves to amend Electricity Act; read details

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A fresh battle over the control of Nigeria’s electricity sector is brewing, as state electricity regulators have accused the National Assembly of attempting to claw back powers already devolved to states under the Constitution and the Electricity Act 2023.

In a strongly worded memorandum submitted to the Senate Committee on Power and obtained by our correspondent on Tuesday, electricity regulatory commissions and bureaus from 16 states warned that the proposed Electricity Act (Amendment) Bill 2026 could reverse one of the most significant reforms in Nigeria’s power sector.

The regulators argued that the amendment bill, rather than strengthening the electricity market, seeks to restore extensive federal oversight over matters they insist have constitutionally become the responsibility of states.

The concerns were contained in a letter dated May 26, 2026, addressed to the Chairman of the Senate Committee on Power and signed on behalf of the State Electricity Regulatory Commissions and Bureaus.

Signatories to the document included the chairmen and chief executives of electricity regulators in Abia, Anambra, Bayelsa, Edo, Ekiti, Enugu, Gombe, Imo, Kogi, Lagos, Nasarawa, Niger, Ogun, Ondo, Oyo and Plateau states.

The regulators said they had taken advantage of the Electricity Act 2023 to begin building sub-national electricity markets and had already engaged investors based on the framework created by the law.

They noted that they had earlier met with the Senate committee and were subsequently requested to consolidate their concerns into a single memorandum for the consideration of lawmakers, the Nigerian Electricity Regulatory Commission and other stakeholders.

The letter stated, “We represent State Regulatory Commissions/Bureaus that have taken advantage of the Electricity Act 2023 to commence the development of our sub-national electricity markets and sectors.

We are grateful for the audience you granted us to raise concerns on the ongoing consideration of the proposed Amendment Bill 2026 to the Electricity Act 2023.

“As agreed during our discussion, we have collated and consolidated the comments into one document which is hereby attached for the consideration of the Senate and House Committees on Power, NERC and other stakeholders.”

The state electricity regulators said they had identified 17 contentious provisions in the proposed amendments to the Electricity Act that they believed could undermine the constitutional powers already granted to states in the electricity sector.

According to the regulators, the areas of disagreement include the authorisation of State Houses of Assembly to legislate on electricity matters, the supremacy of state laws within state electricity markets, and provisions seeking to retain federal control over all activities connected to the national grid.

Other disputed clauses relate to restrictions on states’ participation in the wholesale electricity market, matters concerning the Nigerian Wholesale Electricity Market, the authority of states over independent transmission and distribution networks, and the establishment and administration of the Power Consumers Assistance Fund.

The regulators also raised concerns over the proposed expansion of the powers of the Nigerian Electricity Management Services Agency, the structure and decisions of the Forum of Electricity Regulators, and the provision granting the Nigerian Electricity Regulatory Commission final administrative appellate jurisdiction on certain issues arising within the forum.

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They further opposed provisions designating electricity generation, transmission, distribution and supply as essential services, as well as clauses dealing with government-owned enterprises as licensees and obligations to host communities.

Additional areas of contention include the regulation of intra-state electricity matters that may have implications for the national grid, the imposition of timelines and phased conditions for states transitioning into independent electricity markets, and proposed federal oversight on consumer protection, anti-trust measures and tariff design within state electricity jurisdictions.

The regulators argued that the disputed provisions require further consultation to ensure that the decentralisation objectives of the Electricity Act are not weakened by subsequent amendments.

“A review of the Bill suggests that the general intention is to reverse the devolution of legislative, governance and regulatory powers over electricity matters that occur solely within the respective states to the state governments, in favour of a reconsolidation of powers at the federal level, with the Nigerian Electricity Regulatory Commission retaining full supervisory powers over the market. Effectively, it appears that the intention of the Bill is that Nigeria should continue with the same regime that, for 20 years, has not led to any significant increase in power availability or per capita consumption for Nigerians, despite ever-increasing (and unsustainable) federal debt.”

At the centre of the dispute is the interpretation of the constitutional amendments that allowed states to legislate on electricity matters within their territories. The regulators argued that the proposed amendment bill wrongly assumes that state legislatures derive their powers from the National Assembly rather than directly from the Constitution.

According to them, any attempt by the National Assembly to grant, restrict or redefine those powers through ordinary legislation would amount to a constitutional violation.

The memorandum stated, “Section 2 of the Bill aims to amend Section 2(2)(a)-(e) of the Principal Act. By that section, the National Assembly reserves to itself the power to delegate legislative powers to States’ Houses of Assembly, suggesting that the Bill (or the Principal Act) is the source of the powers of a state to make laws on its electricity markets.

“This provision is based on a shocking miscomprehension of Nigerian constitutional law—it proceeds from the wrong assumption that the NASS, by ordinary legislation and not constitutional amendment, can confer (or restrict) the legislative power of states.

“The constitutional division of powers is fundamental to federalism, ensuring a balance between national unity and state autonomy. There is no legal framework for the NASS to ‘empower’ state governments to make law by ordinary legislation, as the language of the Bill attempts to do.

“The constitutional division of powers is fundamental to federalism, ensuring a balance between national unity and state autonomy. There is no legal framework for the NASS to ‘empower’ state governments to make law by ordinary legislation, as the language of the Bill attempts to do. Consequently, Section 2 of the Bill, seeking to amend Section 2 of the Act, is not consistent with the Constitution.”

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The regulators described as “a shocking miscomprehension of Nigerian constitutional law” the provisions of the bill that appear to suggest that the National Assembly is the source of states’ authority over electricity matters.

They warned that the proposed law could undermine the principle of federalism by weakening state autonomy. Beyond constitutional concerns, the regulators said the bill could create uncertainty in the electricity market and discourage investors who had already committed resources based on the existing legal framework.

“The clear intention behind the new drafting is to reconsolidate in the Federal Government matters solely within the state electricity markets which had been devolved to the states,” the memorandum stated.

“This will defeat the key objectives of the Electricity Act and the various states’ electricity laws, even before the regime introduced by them has taken any root. It will introduce avoidable disruption in the industry as significant investment decisions have already been taken based on the Electricity Act 2023, and these investments are now put at risk by this proposed amendment.”

The state regulators specifically faulted provisions relating to federal oversight of activities connected to the national grid, restrictions on state authority over wholesale electricity transactions, the proposed expansion of NERC’s powers and changes affecting mini-grids and independent distribution systems.

They argued that allowing NERC to retain overriding authority over electricity activities merely because they have some connection to the national grid would effectively render state powers meaningless.

The memorandum stated, “What is required, in order to attain the full benefits of the decentralisation of the Nigerian Electricity Supply Industry that is the theme of the Fifth Alteration and provided for in the Principal Act, is proper coordination on transmission matters between NERC and state regulators, and not top-down federal legislation.”

The regulators also rejected provisions that would permit NERC to exercise final administrative appellate jurisdiction over disputes involving state electricity regulators. According to them, NERC and the SERCs are on equal standing within their respective constitutional spheres of authority.

“NERC and the SERCs are on equal standing within their respective constitutional spheres of authority,” the memorandum said. “The National Assembly cannot arrogate to NERC quasi-judicial authority over SERCs, especially where the dispute might be on a matter over which NERC has no authority.”

They further argued that the Constitution already vests judicial powers in the courts and that such responsibilities cannot be transferred to a regulatory agency. The proposed establishment of a Forum of Electricity Regulators also drew criticism.

Although the regulators acknowledged the importance of coordination among electricity regulators, they argued that participation in such arrangements should be voluntary rather than imposed through federal legislation.

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“The better approach would be a Memorandum of Understanding or similar instrument jointly negotiated by all relevant regulatory bodies in which the principles of coordination and harmonisation will be agreed,” they said.

The state regulators equally opposed provisions declaring generation, transmission, distribution and supply of electricity as essential services covering both federal and state electricity markets.

According to them, such provisions could inadvertently expand NERC’s jurisdiction into areas already devolved to states, including tariff regulation. “The provision is invidious, regressive and should be expunged,” the memorandum stated.

The regulators also faulted proposals empowering NERC to determine contributions to the Power Consumers Assistance Fund from electricity consumers. They argued that since electricity tariffs and retail supply have become matters for state regulation, decisions relating to subsidies and customer contributions should similarly reside with state authorities.

Other contentious areas identified by the regulators included host community obligations, the role of the Nigerian Electricity Management Services Agency, licensing arrangements involving government-owned electricity enterprises and timelines for states transitioning into independent electricity markets.

The dispute highlights the growing tension between the Federal Government and states over the future structure of Nigeria’s electricity industry. The Electricity Act 2023 was enacted following the Fifth Alteration to the 1999 Constitution, which removed electricity from the Exclusive Legislative List and empowered states to generate, transmit and distribute electricity within their territories.

Since then, several states have enacted electricity laws and established regulatory agencies to oversee emerging sub-national electricity markets. Lagos, Enugu, Ekiti, Ondo, Edo and other states have already commenced varying stages of implementation of their electricity reform programmes.

Energy experts have repeatedly described the decentralisation of the sector as a major opportunity to attract investment, improve efficiency and expand access to electricity. However, the latest amendment proposals appear to have reopened the debate over how regulatory powers should be shared between Abuja and the states.

As the National Assembly continues deliberations on the amendment bill, the position adopted by lawmakers could shape the future direction of Nigeria’s electricity reforms and determine whether the country deepens its experiment with decentralisation or returns to a more centralised regulatory model.

The Electricity Act 2023 was designed to operationalise the constitutional amendments that empowered states to participate directly in electricity generation, transmission and distribution within their boundaries. Since its enactment, several states have passed their own electricity laws and established regulatory commissions.

The proposed Electricity Act (Amendment) Bill 2026 seeks to amend several provisions of the principal legislation. However, state regulators contend that some of the proposed changes amount to an attempt to reverse the gains of decentralisation and restore broad federal control over the Nigerian Electricity Supply Industry.

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Africa urgently needs more fish farms, says UN

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Africa needs to urgently expand its fish-farming sector to meet its food needs, the head of the UN’s fisheries division said Tuesday, even as its latest report found record production levels globally.

Fish and seafood is now a $184-billion trade, according to the State of World Fisheries and Aquaculture report by the United Nations’ Food and Agriculture Organization (FAO), launched at the Our Ocean Conference in Kenya.

Fish-farming, or “aquaculture”, overtook traditional “capture” fishing as a source of food production in 2021 and has continued to grow — surpassing 100 million tonnes for the first time in 2024, the latest year for data.

But Africa is lagging behind the rest of the world, with only 18 percent of its fish coming from farms, compared to around half elsewhere.

Sub-Saharan Africa’s fish production will need to grow by 68 percent between now and 2050 to keep up with its rapidly growing population, the FAO said.

“It’s an opportunity waiting to be exploited… but it’s whether the timing is sufficiently fast to catch up with that demand,” Manuel Barange, director of the FAO’s fisheries division, told AFP.

“Aquaculture can actually be a game-changer,” he said. “If we manage to develop aquaculture in Africa, there’s a lot of opportunities.”

But governments urgently need to create regulations and incentives to attract investors, Barange added.

More than 700 different species of fish are raised for consumption on aquaculture farms around the world and the FAO argues it is a more predictable and sustainable approach than traditional fishing at sea.

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It is also more manageable in the face of climate change, which is causing rapid changes in the volumes and locations of ocean fish.

Climate change is “a disruptor of everything that we do,” said Barange.

More work is also needed to reduce over-fishing: the report found that only 62 percent of global fisheries were sustainably fished.

The 11th edition of the Our Ocean Conference began in the Kenyan port city of Mombasa on Tuesday — its first time in Africa — bringing together politicians, NGOs, investors and innovators.

Since its first edition in 2014, organisers boast that it has led to more than 2,900 commitments valued at over $169 billion, covering marine conservation, sustainable fisheries, climate adaptation, security and pollution reduction.

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