President Muhammadu Buhari declared on Wednesday that Nigeria’s oil
reserve estimate as per reserve has been estimated to dry up in the next
25 years to 30 years at most.
To this end, the
President said the focus of the government must be on gas which is also
estimated to last for over 60 years, adding that his government must
ensure a dramatic movement into gas production.
President Buhari,
who was represented by the Minister of State for Petroleum Resources,
Dr Ibe Kachikwu spoke yesterday at the 5th triennial delegates
conference of the Petroleum & Natural Gas Senior Staff Association
of Nigeria (PENGASSAN) in Abuja.
He also cleared the air on the
argument surrounding the sale of the nation’s refineries, declaring that
there is no plan or attempt to sell or concession the refineries as
being speculated “by those who should know better.”
President
Buhari’s Keynote address on the theme: “Emerging Trends in the oil and
gas industry and its impacts on Labour movement in Nigeria,” was
presented by Dr. Kachukwu, who emphasized that he was representing and
presenting the message of the president.
He said: “As it concerns
Nigeria, we must work inclusively hard to deal with some of the
difficulties that we will continue to see in our production platforms.
Whether it is the militants which is a key component or the slow speed
of approvals or whether the fact that our policies are not even as fast
as they should to catch up with changing Times.
“Those of us who
have the opportunity to seat in ministerial zones where we have to
influence policies have got to work extremely hard to help drive the sea
of change that is imperative if the sector is to survive.
“Infrastructural
deficit is a key component. We lack infrastructure in the sector,
whether it is down stream or up stream or oil and gas. The absence of
infrastructure has made it impossible to have a holistic private sector
participation. We have got to find policies that will encourage private
sector participants to play a key role.
“Coupled with that is the
fact that countries are moving away from oil. Our oil estimate as per
reserve is at best about 25 to 30 years, while gas estimate is over 60
years. Clear enough, Nigeria is more of a gas country than an oil
country. But what are we doing to ensure our dramatic movement into the
gas production.
“I am just coming from the FEC where we
presented a memo on gas which has been approved today. Major movement is
in terms of what we need to do in the gas environment because it is so
key that unless we can put the two energy together, we are not likely to
see an improvement in our economy or see opportunities that most of you
are beginning to miss in terms of job creation and employment in the
oil sector.”
He added: “Gas is the new horizon of opportunity. There
is so much happening that needs to happen, that should have happened
yesterday. Gas is the future for this country and the place to be and we
need to start looking at that. Increasingly, we are seeing very strong
local players.
“I need to see gas flaring east out win the next
three years. I like to see the refineries which is enmeshed in all kinds
of confusion finally kick off.
“On the issue of refineries, let
me say that there has been attempt and there is no approval to
concession refineries or sell refineries. I keep hearing discussions all
over the place especially from people who should know better.
“What
we have approval for is to bring in a financing mechanism that will
enable us to finance and develop and upgrade the refineries as they are.
The reality is that once private sector players begin to build their
own refineries, whatever we are afraid of will disappear and unless we
begin to move very rapidly and quickly to position these refineries in
such a way that they can compete, we will lose the refineries completely
together with the job scale that exist there right now.
“My
drive is to see that those investments goes through a transparent
process and the announcement that you hear about selection has not
happened.”
On the emerging trends in the industry, he said the
reality is that the oil industry is changing almost transformatively;
while prices have tumbled and have continued to struggle despite all the
works done in OPEC to boast it.
According to him, “the reality
is that investments are declining at an alarming rate and suddenly,
there are new entrants into the industry. Also, CEOs are struggling as
to where to put very scarce resources and suddenly, it is just how well
you can market your country, reposition your policies in such a way that
there are benefits.
“All in a sudden, investment return in some
of these exploration activities are beginning to get challenges. Only
those who are able to look at their technology and new ways of doing
business are going to survive the oil industry of tomorrow.
“If
you take the annual return of most of the major oil companies, you will
see the sort of disequilibrium that’s happening there and those who are
beginning to jump in and out of leadership