Oil
Oil consultant calls for PIB passage
ABUJA – A legal consultant in the Oil and Gas sector, Emeka Okwuosa has called on the Federal Government to ensure the immediate passage of the Petroleum Industry Bill (PIB), so as to cushion the effect of a decline in Nigeria’s crude oil export to the United States of America.
Okwuosa, who is the Managing Partner of Chancery Associates law firm, made the call following the recent evolution of Shale oil in the U.S, adding that Nigeria’s crude export stands threatened by this evolution.
He said that the U.S shale oil was no cherry news for Nigeria, given the fact that America is the largest importer of Nigeria’s crude oil, accounting for over 33 percent of the nation’s crude export.
According to the him, shale oil development will lead to a net fall. In Nigeria’s crude export to the US, with the attendant reduction in government revenue which will in turn have a multiplier effect on the economy.
“The recent evolution of shale oil in the U.S has led to a steady decline in Nigeria’s crude export from one million barrel per day in december 2009, to less than 352,000 barrels per day as at february 2013.
“Between 2011 and 2012, Nigeria fell from being the third largest supplier of crude oil to the united states, to the sixth largest after Canada, Saudi Arabia, Mexico, Venezuela and Russia in September 2011.
“In addition to this decline, there are indications that by 2014, the United States would no longer be importing crude from Nigeria, as president Barrack Obama has corroborated the US position on this.
“On a state visit to South Africa on June 29, 2013, Obama said “on the issue of Energy for example, frankly we don’t need energy from Africa because we are seeing oil production and natural gas production as well as clean energy production, all growing at a rapid rate in America” he said
According to Okwuosa, Obama’s statement in essence implies that America’s rules of engagement with Africa including Nigeria in the energy sector, is fast becoming a thing of the past, and this requires urgent address by government.
He however said there were myriads of palliatives which the Federal Government could employ to mitigate the impact of shale oil development in the nations economy.
“Following the shale oil revolution, It is now imperative that an investor friendly Petroleum Industry Bill is timeously passed into law, because its delay is holding back investment and this is impacting negatively on the Nigerian Economy.
“Government must take positive steps to revive and maintain our ailing dilapidated refineries, and push for an enabling environment to encourage investors to build new refineries in Nigeria.
“It is also imperative for government to diversify the economy from being soley oil dependent, to other streams of income generation such as Agriculture and solid minerals, other wise the ripple of our over reliance on crude export to the US, will be devastating to the economy” Okwuosa said
He therefore urged the FG to seize the opportunity and create other avenues to boost the nations economy, so that the shale revolution will be a blessing in disguise rather than a curse.
– BUSINESSDAY
Oil
FG Introduces New Incentives To Revitalize Nigeria’s Oil & Gas Industry
In a strategic move to revitalize Nigeria’s oil and gas sector, the Federal Government has unveiled two key fiscal incentives aimed at attracting investment and enhancing energy security.
The announcement was made by Mr. Wale Edun, the Minister of Finance and Coordinating Minister of the Economy on Wednesday.
The first initiative, the Value Added Tax (VAT) Modification Order 2024, introduces critical exemptions for essential energy products and infrastructure, including Diesel, Feed Gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), Electric Vehicles, Liquefied Natural Gas (LNG) infrastructure, and Clean Cooking Equipment.
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These exemptions are designed to reduce living costs for Nigerians, promote energy security, and accelerate the transition to cleaner energy alternatives.
The second initiative, the Notice of Tax Incentives for Deep Offshore Oil & Gas Production, offers new tax relief options for deep offshore exploration projects.
This measure aims to position Nigeria’s deep offshore basin as a premier destination for international oil and gas investments, boosting the country’s appeal to foreign investors.
These reforms are part of a broader set of policy initiatives, known as Policy Directives 40-42, endorsed by President Bola Ahmed Tinubu.
The directives reflect the administration’s commitment to fostering sustainable development in the energy sector and enhancing Nigeria’s competitive edge in the global oil and gas market.
Business
Tinubu set to approve ExxonMobil-Seplat oil deal, expands CNG bus initiative
By Yemie Adeoye
NIGERIA’s President Bola Tinubu has announced that the protracted ExxonMobil-Seplat upstream oil divestment will be formally approved by the Minister of petroleum within a matter of days, just as he announced his government’s intention to expand the Compress natural Gas, CNG buses initiative.
The President who stated this during his Independence day nationwide broadcast stated that the move is in line with his administration’s commitment to free enterprise, free entry and free exit in investments which is the hallmark of his administration investment policy.
“Fellow compatriots, our administration is committed to free enterprise, free entry, and free exit in investments while maintaining the sanctity and efficacy of our regulatory processes. This principle guides the divestment transactions in our upstream petroleum sector, where we are committed to changing the fortune positively. As such, the ExxonMobil Seplat divestment will receive ministerial approval in a matter of days, having been concluded by the regulator, NUPRC, in line with the Petroleum Industry Act, PIA. This was done in the same manner as other qualified divestments approved in the sector.”
The President also seized the opportunity to plead with Nigerians to be patient with his administration’s reform policies. “As your President, I assure you that we are committed to finding sustainable solutions to alleviate the suffering of our citizens. Once again, I plead for your patience as the reforms we are implementing show positive signs, and we are beginning to see light at the end of the tunnel”.
“Our energy transition programme is on course. We are expanding the adoption of the Presidential Initiative on Compressed Natural Gas for mass transit with private sector players. The Federal Government is ready to assist the thirty-six States and FCT in acquiring CNG buses for cheaper public transportation.
Fellow Nigerians, while we are working to stabilise the economy and secure the country, we also seek to foster national unity and build social harmony and cohesion. Our economy can only thrive when there is peace”. he enthused.
Oil
ExxonMobil To Invest $10bn In Nigeria’s Deep-Water Oil Operations
As part of the administration’s push to improve Ease of Doing Business (EoDB), Nigeria’s Vice President Kashim Shettima has expressed support for ExxonMobil’s plan to invest $10 billion in the country’s deep-water oil sector.
Speaking on Wednesday, September 25, 2024, during a meeting with ExxonMobil executives at the 79th United Nations General Assembly (UNGA) in New York, Shettima called the investment “a clear testament to the administration’s economic reforms and investor-friendly policies.”
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This announcement follows news that international maritime company DP World intends to develop a multibillion-dollar port project in Nigeria.
Stanley Nkwocha, Senior Special Assistant to the President on Media and Communications, shared the development in a statement on Wednesday. He quoted Shettima as saying: “ExxonMobil’s potential investment aligns with the vision of President Bola Ahmed Tinubu’s administration for a more investment-friendly Nigeria.
We are committed to fostering an environment that supports such transformative projects.”Shettima also discussed the administration’s broader efforts to improve the ease of doing business, highlighting the “Renewed Hope Agenda,” which aims to simplify bureaucratic processes, enhance transparency, and offer fiscal incentives to attract global investors.
“Our administration has taken bold steps to unify the exchange rate, remove fuel subsidies, and implement tax reforms. These measures, though challenging in the short term, are intended to create a stable and predictable business environment in the long term,” he added.
On the oil and gas sector, Shettima mentioned that the government is revising the fiscal framework for deep-water operations to attract investment while ensuring fair returns for the Nigerian people.