Oil
NNPC Says No Cause for Alarm on IOC Divestment
…As Engr. Yakubu Assures of Nigeria’s Readiness to Tackle Shale Oil Threat
SEOUL – The Nigerian National Petroleum Corporation (NNPC) has dismissed insinuations in some quarters that the recent spate of divestments from certain onshore oil blocks by some international oil companies (IOC) may lead to crisis in the nation’s oil and gas industry.
Speaking to journalists on the margins of the ongoing World Energy Congress in Daegu, South Korea, Group Managing Director of the Nigerian National Petroleum Corporation, Engr. Andrew Yakubu, explained that the reported divestments are not only healthy for the oil and gas industry in Nigeria but would also go a long way in promoting effective indigenous participation in core upstream activities.
“These are not withdrawals in the real sense of withdrawals. The fact is that a number of these IOCs are moving into more challenging frontiers in the deep offshore and are leaving the onshore blocks which they consider less challenging,” he said .
The NNPC GMD noted that the major players that are divesting have actually been sitting on those acreages and have allowed them to go fallow for years without significant development.
“So it is only fair for them to release these blocks so that others, especially the indigenous operators can have the blocks and grow in the upstream business. This indeed is a good development and I think we are moving in the right direction,” he said.
The GMD hinted that the divestment offers immense opportunities for the nation’s indigenous flagship upstream operator, the Nigerian Petroleum Development Company (NPDC) to grow its capacity and capability especially as it strives to meet the aggressive target of daily crude production of 250, 000 barrels by 2020.
Engr. Yakubu who is leading a team of Nigeria’s oil and gas experts to the global energy meet also submitted that the advent of the shale gas and oil revolution in America for now would not have serious negative impact on the nation’s crude oil fortunes as earlier projected by some petroleum analysts.
“No doubt the shale gas phenomenon poses a pushback on our oil and gas, but the good news is that as we speak the impact is going to come a very long time from now because a close examination of the various discoveries of shale gas shows a huge misalignment between what was projected and the actualization of most of the gas projects that would bring shale gas into full maturity,’’ the NNPC GMD noted.
He explained that though the shale gas revolution is real, its availability in the global energy market is being hampered by high cost and other infrastructural challenges thus making conventional crude oil a cheaper energy source.
He, however, stated that while the NNPC takes comfort in this development, the Corporation is moving to activate measures to ensure that the country is not caught napping if and when shale gas achieves the projected global penetration.
“Once again, the good news in this regard is that Mr. President, through the Honourable Minister of Petroleum Resources, Mrs. Diezani-Alison-Madueke, has made it clear that the maximization of our various energy resources is central to the reforms in the oil and gas industry. And back home we have since channeled our energy to the development of petrochemicals, fertilizers and other gas-based industries that would maximize the utilization of our gas resources. So far our interactions and engagements with various global energy leaders in this Congress have reassured us that we are moving in the right direction,” Engr. Yakubu said.
The 22nd World Energy Congress in Daegu, South Korea, which is billed to climax on Thursday, 17th October, 2013, has in attendance over 6,000 delegates from prominent energy jurisdictions across the world.
The Congress which has the central theme “Securing Tomorrow’s Energy Today,” is focused on the challenges posed by the globalization of energy demand, how energy supplies can be protected against disruptions and how efforts to mitigate climate change affect access to future energy resources. These are summed up in the concept of the “energy trilemma” by the World Energy Council, organizers of the Congress.
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.
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.
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.”
Read Also: Offset Accuses Cardi B Of Cheating During Pregnancy
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.
JUST IN: NNPC Ltd Disclaims Video Of Adulterated Fuel Sold in Bottles, Jerrycans
New Terrorist Group Emerges In Northwest Nigeria – DHQ
Osun Declares Three-Day Mourning For COAS, Lagbaja
Shallipopi Splits From Record Label, Dapper Music
Lagos Gov’t Launches Bid For 500MW Gas Power Hubs Amid Energy Crisis
BP, Trafigura, Vitol Lead Global Offtake Of Dangote’s Refined Products
OSSG Raises Alarm Over Murder Plot By APC Chieftain
NCC, SMEDAN, NAICOM, SEC, Others Set for SUPERNEWS SMEs Conf June 13
Sahara’s Tonye Cole resigns from GPHCDA
Oando opens ultra-modern petrol station in Lagos
Niger Delta Avengers: President Buhari Reads riot Act …considers the carrot and stick option
