There were no key investment decisions taken on deepwater oil and gas exploration in the Nigerian energy industry between 2015 and 2019, much as opportunities for business existed, Total Exploration and Production Nigeria Limited said on Tuesday.
Mike Sangster, the managing director of the Nigerian operations of the oil supermajor, disclosed that pending dispute resolution, impending lease expiry and escalating costs accounted for the factors that were keeping investors at bay.
“Nigeria has only benefitted from less than five per cent of all investments in oil and gas in Africa between 2015 and 2019 despite having the largest reserves,” the Total chief told the management session of the virtual Nigerian Association of Petroleum Explorationists 2020 conference.
Sangster, who was represented by Total’s Deputy Managing Director Victor Bandele, noted that the interventions by authorities in forging an enduring framework for the energy sector was capable of restoring confidence and delivering attractive benefits, which could offer mutually favourable solutions to the country and investors.
“This will further attract more capital investment in an ever more competitive world. A progressive, win-win PIB will no doubt be the catalyst needed for a new wave of hydrocarbon exploration and development investment in Nigeria,” he said.
The oil and gas sector of Nigeria, Africa’s biggest oil producer, is proving a hard sell to international investors on account of myriad regulatory bottlenecks and difficulty in doing business, causing it to receive only 5 per cent or $3 billion of all oil and gas funds invested on the continent between 2015 and 2019.
The chair of the Society of Petroleum Engineers, Olatunji Akinwunmi, observed that the Niger-Delta Basin, where more than 90 billion barrels of oil had been discovered, remained technically attractive.
“Funds for E&P development is globally more scarce in light of the planned gradual transition from fossil fuels dependence to an energy mix that would have increasing contribution from renewables.
“There is every need to encourage and support speedy win-win resolutions of the outstanding blocking points in the new PIB as time is not on our side,” he said.
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