“Without natural capital accountability GDP growth is meaningless’
Stock photo of an offshore oil rig“Without natural capital accountability GDP growth is meaningless’

Reaching net zero requires investment — Experts

Lee Engineering, Oilserv, Seplat, advocate gas, technology as enabler 

 By Ediri Ejoh

Globally, investment in the petroleum industry, dropped by about 50 per cent over the past five years, due to the clamour for reduction in carbon dioxide emissions and negative impact of COVID-19 pandemic.

The President, Society of Petroleum Engineers, Kamel Ben-Naceur, stated this while presenting his keynote address at the on-going Offshore Technology Conference (OTC) in Houston, Texas, USA, yesterday.

Ben-Naceur, who stated that the investment started to slide in 2015 and worsened in 2016, added that, the situation witnessed a turnaround before the global pandemic in 2020.

However, he said: “Investment rose through 2019 before experiencing a 30 percent drop in 2020. If we look at the relative decrease in investment in less than five years, we have reduced the upstream investment by 50 percent which is almost unheard of. You have to go back to the mid-80s to see that kind of a trend.”

Ben-Naceur noted that the COVID-19 pandemic had a unique impact on the energy industry and will go a long way in affecting the moves toward energy transition.

Meanwhile, stakeholders in the oil and gas industry in Nigeria are striving to take advantage of the Federal Government’s declaration of the year 2021 to 2030 as a decade of gas.

Speaking to Vanguard in Houston, some operators participating in the OTC, such as Lee Engineering and Construction Company Limited, Oilserv and Seplat Energy plc, emphasized the need for local companies to invest in the gas sector. 

They also called for more investment, insisting that enormous opportunities are available for investors in the sector.  

Specifically, Chairman, Lee Engineering and Construction Company Limited, Dr. Leemon Ikpea, who emphasized the importance of improving the country’s infrastructure, said his company has invested over $100 million in the construction of a fabrication yard in Warri, Delta State.

“The project, which is due for commissioning this year, will guarantee the fabrication of any equipment required in the oil and gas industry locally.”

Recounting his experience, he said: “When I was a manager, I did not sit down in my office. I took time to understand how the company operated. I noticed that many Nigerians were performing various tasks as electricians, welders and so on. The foreigners were mostly there as supervisors. There are many skilled Nigerian workers around.

“The idea of transiting from seeking contracts to the manufacturing of necessary equipment and spare parts for the oil and gas industry comes with a lot of benefits for the sector. First, it engenders technology transfer, saves foreign exchange, builds capacity alongside many other multiplier effects.”

On his part, chairman, Oilserv Limited, Mr Emeka Okwuosa, said his company’s participation in construction of the Ajaokuta-Kaduna-Kano (AKK) gas pipeline project is an indication of Nigeria’s commitment to energy transition.

According to him, “The AKK project will stimulate gas infrastructural development and industrialisation in Nigeria. The AKK gas project, when completed would boost the agricultural and manufacturing sectors, carbon footprint as part of measures to cut down on global warming and provide gas for generation of power and gas-based industries.”

 “The project is important to Nigeria because gas is what will help Nigeria to develop. Development cannot happen without energy and our greatest form of energy in terms of availability is gas.”

Similarly, Chief Executive Officer, Seplat Energy Plc, Roger Brown, identified gas development and technology as key in ensuring robust transitioning.

He said: “as sector grows and evolves and fight betweeen transitioning, we must be super efficient in what we do particularly in the upstream and technology is very critical in delivering that.”

“We believe that IT, cyber- help are more efficient technologies needed in the infrastructure development. We are bringing more technologies on our project like the use of Solar, gas. We believe in the gas business as we would develop LPG.

“We will finish the Assa North-Ohaji South (ANOH) gas plant by next year and it’s a game changer for us. Also we are upgrading the Sapele gas plant at the moment and puting on LPG and broaden that second pillar of our business which is gas processing going into electricity.

“We are really looking at what renewable technologies would be adopted into our business that would be the best for Nigeria going forward. Our view from our business model is that solar would be the win game changer. 

“For us at Seplat, investment never stops as we would make more investment in the coming months.”

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