Nigeria: Oil Companies Lead CBN Forex In Q1

VENTURES AFRICA – In the first quarter (Q1) of 2012, the Central Bank of Nigeria (CBN) sold $4.6 billion worth of Forex through its auction system, with Dangote Cement, MRS, Ontario Oil & Gas Ltd and Oando Supply & Trading Ltd consuming $ 1.8 billion which represents 39 percent of the amount.

Nigeria’s apex bank sells foreign exchange bi-weekly through its Wholesale Dutch Auction System (WDAS), which is the country’s biggest foreign exchange (Forex) market.

Corporate organizations in Africa’s second largest economy patronize the CBN’s Wholesale Dutch Auction System on order to trade Naira for Dollar to fund their business activities across the world, especially to purchase inputs for their manufacturing process, and to import refined petroleum products to sell.

But without Dangote Group, Oil and Gas traders who are not into an economy penetrating business would have dominated the Forex market.

Oil & Gas companies still lead Forex demand in the first quarter with about 40 companies out of the 51 companies that applied for Forex being Oil & Gas companies, this was disclosed by the apex bank on Monday.