Advanced Television

Nigeria’s NigComSat massive losses

March 23, 2020

By Chris Forrester

A report from the International Centre for Investigative Reporting (ICIR), which focuses on Nigeria’s troubled satellite operator NigComSat, states the organisation is “still not profitable 14 years after launch”.

ICIR says that NigComSat’s first working satellite (NigComSat-1R) was launched in 2011 and has barely six years of life left. Meanwhile, the organisation has – since 2009 – received funding totalling more than $117 million (at current rates) although in Nigerian Naira it is N43.5 billion, of which just N13 billion was spent on capital items and N26.2 billion on staff salaries.

ICIR adds that during the period 2011-2014 NigComSat’s revenues from satellite operations were just 3 per cent of its expenses during the period.

The recently appointed (August 2019) Minister of Communications & Digital Economy in Nigeria, Isa Ali Pantami, admitted the business was not “very viable”. In December 2019 a new Board and executive directors were appointed.

An earlier Chinese-built satellite was launched in 2008 which cost $340 million (about Naira 40 billion at the time) but failed in orbit.

ICIR says: “NigComSat’s) wage bill, which started as N747 million in 2009, has jumped to N2.6 billion. With 397 employees as of 2016 and a personnel cost of N2.3 billion that year, the Federal Government must have paid the workers an average of N5.8 million per annum (or N480,000 a month/$1300).

NigComSat is owned by Nigeria’s government. In 2018 it was announced that two new satellites would be bought from China at an expected cost of $550 million.

A recent report from Nigeria’s parliament accused NigComSat’s senior management of incompetence. Chairman of Nigeria’s House Committee on Finance, James Falake, told NigComSat’s Managing Director, Abimbola Alale, in February, that: “We have to rescue this agency from you. In fact, if I had my way, I would recommend your [dismissal].”

Categories: Articles, Business, DTH/Satellite