*As oil coys invest $21bn on PSC blocks
By Hector Igbikiowubo, Yemie Adeoye & Oscarline Onwuemenyi
ABUJAâ€”THE Federal Government, yesterday, stated that there was no going back on oil and gas industry reform, even as it pointed out that the industry was facing core challenges that has made the nationâ€™s oil and gas industry perform below its resourceful standards.
The Minister of State for Petroleum, Mr. Odein Ajumogobia, disclosed this at the opening session of 27th Annual International Conference and Exhibition organised by the Nigerian Association of Petroleum Explorationists (NAPE) in Abuja that the Federal Government was determined to put in place a qualitative assessment of the industry in other to ensure a sustainable development and growth in an efficient manner.
This was coming on the heels of the disclosure that oil and gas companies operating in Nigerian deepwater, have invested over $21 billion in the development of the blocks under the Production Sharing Contract (PSC).
This financing was taken solely by the international oil companies (IOCs), which is different from the shallow water and onshore fields where Nigerian National Petroleum Corporation (NNPC) has joint venture operations with multinational companies and pays its share of investment through cash call. The Managing Director of Chevron Nigeria Limited, Mr. Andrew Fawthrop, who disclosed this further stated that the deepwater operations had boosted Nigerian crude oil production and economy as well.
The Minister of State for Petroleum, Mr. Odein Ajumogobia, said the Federal Government was determined to put in place a qualitative assessment of the industry in other to ensure a sustainable development and growth in an efficient manner.
Ajumogobia said â€œOur industry is sleeping indeed, reasons include, security issues in the area of operation, Niger Delta; decline in production; ageing infrastructure; insufficient funding; long project saturation plan and lack of sustainable and effective framework to ensure the development of the host communities.â€
The Minister of State for Petroleum, who lamented this situation in the petroleum industry, stated that the reform in the industry would go a long way to foster improvement of the nationâ€™s oil and gas industry. The major move to achieve the required change, according to him, was the new Petroleum Industry Bill (PIB) which is currently undergoing the process of approval at the National Assembly.
The Minister refuted claims that the bill would hamper investments in the industry, particularly from foreign investors, noting that it would rather promote investment and make the industry more lucrative and be at par with its contemporaries across the world.
Ajumogobia said the Federal Government was committed to its vision of sustaining growth, maximize reserves and improve on production capacity as well as reserve base, stressing that with the improved security situation in the Niger Delta region, Nigerian production level would increase tremendously.