Sunday, August 02, 2020 / 1:15 PM / Taiyese Nifemi for WebTV / Header Image Credit: WebTV
Experts in the Nigerian Oil and Gas sector have called for increased investments in the infrastructure layout and framework in the industry, and the mid-stream production levels to boost the sector.
This was part of the key takeaways from the recent Nigeria-British Chamber of Commerce (NBCC) Oil and Gas Forum, organized as a webinar through the virtual Zoom video conferencing platform.
Mr. Austin Avuru the CEO of Seplat Petroleum Development Company Plc in his remarks emphasized the need for Nigeria as a nation, to address the following challenges in the industry which include;
Avuru noted that in 2019 the oil and gas sector accounted for 47% of the original budget & revenue of the nation, but stated that going forward there will be lower prices for a much longer period, he noted.
With the current COVID 19 pandemic outbreak, Avuru asserted that Nigeriaâ€™s economic landscape has changed with Oil and Gas accounting for less than 45% of the countryâ€™s revenue.
He called for a paradigm shift post-pandemic in Nigeria which will see a robust diversification in revenue dependency on the Oil & Gas sector.
According to him "Oil and Gas rental revenue being almost the sole funding source for our budget will have to stop".
Speaking further he identified the following areas as key components that work needs to be ramped up on, to enable gas production and consumption;
He believed that all these investments will in turn lift the economy, quality of lives and GDP per Capita of the economy.
Mr. Austin Avuru made a strong case for a deeper level of regional integration in Africa.
He stressed the fact that in identifying investment opportunities, the answer can be found in addressing the question of how hydrocarbon can be tapped into and deployed as an economic growth driver for West Africa.
Representing Engineer Simbi K. Wabote, Executive Secretary Nigerian Content Development and Monitoring Board, Mr. Akintunde Adelana Director, Monitoring and Evaluation Nigerian Content Development and Monitoring Board gave insights into the "Current Global Developments, Implications for Investment, Local Opportunities in Nigeria".
Mr. Adelana said Oil and Gas contribute 95% of foreign exchange in Nigeria and also contribute 10% to the nation's GDP, therefore anything that affects the sector will impact the economy in the short and long run.
Speaking on the pandemic, Mr. Adelana identified a stretched healthcare system, economic losses, fragmented global coalitions and low oil prices regime as part of the adverse impacts on the global, regional and national economy.
On the positive side, the NCDMB representative said COVID-19 has improved internet service provider's revenue, provided more patronage of e-commerce services, companies remodelling their production lines to manufacture ventilators, e-learning, local supply chain strengthening and sustaining productivity through remote working/ cost-saving measures.
He identified Duty of Care, Business Continuity and COVID-19 palliatives as key areas the NCDMB explored in cushioning the effect of the pandemic to ensure that business activities continue.
Mr. Osagie Okunbor Country Chair, Shell Companies in Nigeria & MD, Shell Petroleum Development Company of Nigeria Ltd said the oil outlook looks encouraging as the market starts to rebalance in the latter part of the year, but was of the view that the risk still exists.
According to him, FX revenues in the immediate short term will still have to come from oil and gas. As a country, he stressed the need to remove waste from the cost of production through rationalizing to get to comparable standards with the rest of the world.
He emphasized the need to manage the threat to national revenues through;
"To attract more investments into Nigeria, the security of assets is very important to boost investor confidence as vandalization of pipeline infrastructure can limit the supply of gas," he said.
In his opening remarks the President of the NBCC Mr. Kayode Falowo said with the shifts in the world economic order, the Oil and Gas Group organized the webinar as a forum to review the effect of the global economic disorder amidst the pandemic outbreak of COVID19 as it relates to the Oil and Gas Industry.
Mr. Falowo acknowledged the fact that Nigeria is import-dependent on oil & gas and as such has been greatly affected by global disruption.
Falowo made a strong case for efficient players in the oil sector, still have avenues to thrive and further translate it to inclusive socio-economic growth for the nation moving forward post-pandemic.
The webinar's focus is to better prepare the players in the ecosystem to ride the turbulence, associated with the disruption in the oil and gas industry.
Nigeria is import-dependent on oil and gas and as such been greatly affected by the disruption.
Falowo highlighted the fact that the knowledgeable and efficient players in the oil sector, still have avenues to thrive and further translate it to inclusive socio-economic growth for the nation moving forward post-pandemic.
He noted that the oil and gas sector is a critical enabler of the Nigerian budget and new opportunities can be found in the rising global demand for cleaner sources of energy.
"Following the pandemic outbreak of Covid19 digitalization of oil and gas is a new imperative, which presents opportunities for technology firms in digitalizing the sector," he said.