Exxonmobil urges Nigerian govt partnership for strategic oil sector growth
..says Nigeria would play a key role in world energy demand
By Joseph BAMIDELE
ABUJA-Exxonmobil, a major operator in the Nigeria oil and gas industry has urged the federal Government to urgently consider its strategic cooperation with operators of the oil and gas sector if the growth required in the sector is to be achieved.
This is coming on the heels of assertion by the world’s largest publicly traded hydrocarbon company that with Nigeria’s rich hydrocarbon it would play a key role in global energy demand between now and 2030.
Chairman/Managing Director of the company Mr. Mark Ward who dropped this hint recently at the just concluded Nigerian oil and gas (NOG) in Abuja stated that this was in view of the International Energy Agency’s postulation that global energy industry needs to invest more than 200 billion dollars annually between now and 2030 to meet future oil and gas needs.
The oil boss specifically stated that with the right combination of technology application, investment attracted by globally competitive fiscal terms and public policy support of free trade, transparency, and efficient bureaucracy the Nigerian oil sector would increase in growth and opportunities for both investors and regulators.
“It is within our collective power to resolve the issues limiting reserves and production growth in upstream Nigeria, and my perspective is that now is the time for industry and government to partner together to address these challenges.
Since its founding, the Nigeria Oil and Gas (NOG) Conference has engaged businesses , government and civic leaders in the search for solutions to Nigeria’s most pressing energy challenges. I would therefore like to commend CWC Group for putting this session together and in particular opening up the question of “What’s next” for Nigeria’s Exploration and Production.
This subject is very vital not only to the future of a resource rich country such as Nigeria, but to the very sustenance of global energy supplies.
So I will attempt to convey thoughts on what ExxonMobil considers as vital ingredients of a successful long term exploration and production program for Nigeria and indeed anywhere in the world. We as a company have been in Nigeria for over 100 years and have been exploring and producing for the last 50 years. We also have had operations in just about all the major hydrocarbon basins in the world, so I believe we can bring some perspectives to the question.
One reality we face in industry is the long timeline involved in discovering, developing and deploying new sources of energy to meet growing worldwide demand at a scale that has impact and with an acceptable cost.
Indeed, all of us who have made energy our life’s work understand that the industry moves in long cycles, long-term trends that occur over many years and often up to decades, not days or weeks or months. As an industry, we need to encourage others to look beyond today’s headlines to recognize and understand and attempt to influence today’s policies that will impact the next decade’s success.
while we’re planning our business towards the years 2015, 2020 or even 2030, we must be aware of and participate in the broader public debate that is taking place today”.
He further opined that in the case of Nigeria, it simply means getting PIB right both for government and for the industry.
Oil and Gas industry projects span decades according to Mr. Ward and it requires huge investments, and utilize cutting-edge technologies that evolve throughout project lifecycles. “Long-term planning is therefore critical. Planning that looks beyond the current business cycle and relies on stable and globally competitive fiscal frameworks, clear and transparent regulatory process, efficient bureaucracy and confidence in the ongoing sanctity of the agreements.
The International Energy Agency estimates that our industry needs to invest more than 200 billion dollars annually between now and 2030 to meet future oil and gas needs.
With Nigeria’s rich hydrocarbon endowment, it is clear that Nigeria will play a key role in meeting these needs and the policies need to be in place to ensure that Nigeria is competitive for the global investment dollar.
As oil and natural gas are found in harder-to-reach environments, it is vital that the energy industry develops and invests in technologies that ensure that we can find and develop reserves in an affordable, secure, and environmentally responsible way, for the long term.
However, it is vital that governments recognize that we live in an energy-interdependent world, in which both suppliers and consumers benefit from a well-functioning global marketplace. Capital flows to those that allow for a competitive return. Having resources alone is not enough. As more nations join the ranks of developed economies, Nigeria’s best hope for re-energizing growth and creating new jobs is to put in place a stable policy framework that supports long term investment.
The importance of stable energy policies that support long-range thinking, encourage long-term investment and allow our industry to maintain the required momentum therefore cannot be over-emphasized. We have heard in sessions about the significant position that Nigeria holds in terms of oil and gas resources. We have also heard about how the government’s aspirations to significantly grown production have not been realized in the short term. There have been many reasons brought forward ranging from militancy to lack of funding, time consuming bureaucracy, lack of local capacity, no clarity on PIB. But finding the answers to these questions is Key to determining “what’s next” for Nigeria’s Exploration and Production industry”. He opined.