Forte Oil Rises to 2 1/2-Year High on State Payment: Lagos Mover
Forte Oil Plc (FO) of Nigeria, which operates gasoline stations in Africa’s second-biggest economy, jumped to the highest in almost 2 1/2 years after the government paid money claimed by companies for fuel subsidies.
The stock advanced by the maximum daily limit of 10 percent to 27.06 naira at the close in Lagos, the commercial capital. Almost 670,000 shares traded, equal to more than 1.3 times the three-month daily average.
Forte was among 25 oil marketing companies that received 48 billion naira ($298 million) this week, ThisDay newspaper reported, citing a statement from the Finance Ministry dated yesterday. Total payments made this year stand at 240.5 billion naira, according to the newspaper.
“With the payment by the government, the company will be able to pay off some loans and reduce its interest expense,” Dolapo Oni, a Lagos-based energy research analyst at Ecobank Transnational Inc., said in an e-mailed response to questions.
Nigeria, Africa’s biggest crude producer, subsidizes the cost of gasoline on the local market. An attempt by President Goodluck Jonathan to scrap the rebates in January 2012 without notice sparked strikes and protests. In March, Jonathan said he still intends to withdraw the grants.
Forte’s shares have more than tripled this year and are the second-best performer on the Nigerian Stock Exchange All-Share Index (NGSEINDX), which rallied 37 percent.
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