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Oil price: PETAN, operators to discuss price cut

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Major upstream development projects in Nigeria accruing to billions of naira may have been stalled as a result of the lingering delay in the passage of the Petroleum Industry Bill (PIB), even as the situation has necesitated the reduction of manpower by 80 percent.
By Kunle Kalejaye 
 
Members of Petroleum Technology Association of Nigeria, PETAN have received letters from  operators ‎in Nigeria’s oil and gas Exploration and Production, E&P industry to discuss price cut due to the free fall of crude oil price.
deep offshore oil rig

deep offshore oil rig

This was made known by the ‎Secretary of PETAN and the MD/ CEO of Mansfield Energy, Dr. Dapo Oshinusi in the just concluded Offshore West Africa, OWA.

He told journalist at the last day of OWA that the crash of crude oil price is a big factor, a big issue for PETAN members, but stressing it’s members have to fined a way to deal with it as an organisation and company.

According to him “the fact that oil price has come down is not the first time, it is something that always happen in our ‎industry and it is our responsibility and the responsibility of every company to deal with it so that we will be ready when the oil price goes up.
‎”We have also been given letters, that is PETAN companies by the different operators to come and meet with them to discuss price cutting. So it is a big factor, a big issue for us but we have to fined a way to deal with it as an organisation and company.
“So each company will look inwards where to reduce cost and where to maintain operations and relevance in readiness for more work that will take off which could be in the next three to six months.
‎”The important thing is that the PETAN companies and the various companies that are set up are already here and they will be here when the oil price goes up and more work is available.”
Commenting on PETAN partnership with International Oil Companies, Dr. Oshinusi said there are lots of Nigerian companies forming partnership with various multinationals
“We are doing that everyday because there are ‎a lot of Nigerian companies that are PETAN members forming partnership with various multinational companies. GE for instance formed partnership with PETAN companies.
“Infact one of the growth areas is partnership with multinational companies particularly to get the technical aspect of the technology that we don’t have locally.
“So the different companies that are multinationals companies that have access to these technology, by partnering with them, we will have the opportunity to learn those technologies very quickly. So that is one area we are working on, that is PETAN companies  partnering with ‎multinationals to deliver service,” Oshinusi said.
The PETAN scribe expressed confidence that Nigerian companies in the industry will fare better in deep offshore and shallow offshore operations but stressed that discreet, caution and safety  is required.
‎”I think ‎we have made tremendous strides. From the beginning like you rightly noted, a lot of Nigerian companies were constrain to land location but today we are working deep offshore, we are working shallow offshore.
“Yes many Nigerian companies are going offshore but it is a sensitive area, the cost of developing and producing oil from that sector is a lot higher than from producing from land allocation and the exposure are more.
“So every company will take caution in ensuring that they do the work safely. So it is a question of time ‎and am sure that if we continue the growth rate in the way we are going today, in another few years hoping that the oil price will go up to encourage all these development that we are talking about that more and more Nigerian companies will participate very much in those sector,” Dr. Dapo Oshinusi said.
 

Oil

FG Introduces New Incentives To Revitalize Nigeria’s Oil & Gas Industry

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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.

Read Also: Atiku Calls For Rotational Presidency Across Nigeria’s Geopolitical Zones

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.

 

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Tinubu set to approve ExxonMobil-Seplat oil deal, expands CNG bus initiative

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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.

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Oil

ExxonMobil To Invest $10bn In Nigeria’s Deep-Water Oil Operations

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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.

 

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