Indigenous Companies Invest $10 billion in Oil, Gas Production
The Independent Petroleum Producers Group (IPPG) says its members have invested about $10 billion in oil and gas production in Nigeria from 2003 to date.
The group, made up of 24 indigenous oil and gas companies, also pledged to support the smooth implementation of the Petroleum Industry Act (PIA) to attract more investment to the sector.
Mr Abdulrasaq Isa, Chairman, IPPG, made this known during an engagement between the group and Mr Gbenga Komolafe, Chief Executive Officer, Nigerian Upstream Petroleum Regulatory Commission (NUPRC) on Friday in Lagos.
Isa said the indigenous oil companies’ contribution to Nigeria’s oil production was 252,000 barrels per day and 650MMscf/d of gas.
According to him, this translate to 14 per cent and nine per cent of national oil and gas production respectively. He expressed optimism that the companies would be responsible for 100 per cent of 1.2 million barrels per day refining capacity in the near future.
Isa said the LPG fully aligns with the government’s “Decade of Gas” initiative as it seeks to utilise the nation’s abundant gas resources to power the economy and address underlying issues.
“We are fully aligned to global decarbonisation initiatives and adoption of renewable energy.
“With the current global shift to cleaner energy sources, Nigeria can utilise its domestic gas reserves as a lower-carbon bridge to the energy transition.
” Ultimately, the gas must serve as the transition feedstock for Nigeria and facilitate the transition to larger-scale renewable energy.
“Government international advocacy drive is required for gas to be considered as a transition fuel in order to attract investment into the sector,” he said.
Isa listed some of the challenges faced by the companies to include gas pricing, crude oil theft, security, high operating cost, long contracting cycle and crude handling charges.
He said with the ongoing divestment by some International Oil Companies due to the global energy transition, it was imperative that the government set up an energy bank to finance projects in the oil and gas sector.
Earlier, Komolafe said indigenous companies were critical to the smooth implementation of the PIA signed by President Muhammadu Buhari on Aug. 16.
He said the maiden engagement with the group was to solicit their support toward the implementation of the PIA and to listen to their challenges as they affect the industry.
“Our meeting is to formally unveil the NUPRC to you and to familiarise and identify with you as a regulator business enabler in upstream operations.
“This is coming at a critical point in the industry when the clamour from the global community is focused on energy transition from fossil fuels to cleaner energy,” Komolafe said.
He noted that the decisions taken at the ongoing United Nations Climate Change Summit in Glasgow, Scotland, could affect securing of funds for critical oil and gas infrastructure in Nigeria.
Komolafe assured the IPPG that the commission would be a fair and transparent 21st century regulator geared towards optimising revenue for government and investors.
The News Agency of Nigeria reports that the IPPG was established in 2015 as an association of indigenous Exploration and Production (E&P) companies with a current membership of 24 companies. The group was set up to promote and advance the development of the Nigerian petroleum industry.
Read Also: Indigenous Firms Contribute 33% to Nigeria’s Oil Reserves – DPR
