Capital markets operators and financial analysts have urged the Federal Government to consider indigenous firms in the sale of oil assets to enhance the nation’s capital market and reduce loss of billions of dollars by the federal government due to non-listing of oil and gas majors on the Nigerian Stock Exchange.
According to reports, major oil exploration and production companies with asset value of about $89 billion list their shares outside the country. This has led to a great loss of revenue to the government and affected the growth of the Nigerian capital market.
Some of the oil and gas companies active in the Nigeria but are listed outside include: Afren Plc, Centrica, Eland Oil and Gas, Essar Energy, Heritage Oil, Lekoil Royal Dutch Shell, CAMAC Energy, Sasol, Mart Resources Inc, Mira Resources among others.
Further assets divestment in the oil and gas sector is expected to create between $4 billion and $8 billion in value in the next two years and analysts said if Nigerians firms are not considered the country would continue to rue its losses.
The Managing Director of Crane Securities Limited, Mr. Mike Ezeh “As we expect further government and private divestment in the oil and gas sector, I believe indigenous firms should be given the opportunity to buy some of these assets. If this is done, the companies will be listed on the Nigerian bourse thereby deepening the capital market and sharing the profit among Nigerians”.
Also speaking, investment banker, Mr. Victor Ogiemwonyi of Partnership Investment Company Plc, said besides selling the assets to Nigerians, government should also include incentives such as lower tax rate to encourage listing on the NSE.
“We should also require public companies with licences that serve larger public to list their shares on the NSE for public participation after a stated number of years. Government should compulsorily make privatised companies especially; list a portion of their shares. Without these steps the stock market will not grow as fast as we want,” he said.
David Adonri of Lambert Trust and Investment Limited Company said the foreign companies should be made through legislation to list their shares. He added that foreign companies are only here for exploitation. They have no interest in sharing their wealth with Nigerians. Therefore, it is only through legislation that they can be obligated to list.