Financial Energy Review
Vice President Yemi Osinbajo, has called for a concerted effort by government and professional groups to develop a secure and sustainable energy supply system to facilitate development agenda of government.
Osinbajo, said sustainable investment in alternative energy is key to rescue Nigeria from under-development and boost industry output.
Speaking at the 38th Annual International Conference and Exhibition of the Nigerian Association of Petroleum Explorationists (NAPE); a virtual engagement themed “Accelerating Growth in Nigeria’s Hydrocarbon Reserves: Emerging Concepts, Challenges and Opportunities”., Osinbajo however, challenged authorities on sustaining hydrocarbon search across all frontiers as oil and gas would remain fuel of choice in coming decades.
Represented by Minister of State for Petroleum Affairs, Timipre Sylva, the Vice President said, there is no gainsaying the fact that the growth and development of some nations is heavily dependent on energy availability and utilization, especially on crude oil and increasingly on natural gas.
Renewable energy, Osinbajo observed is becoming a cheaper form of energy, and responses to climate change widely attributable to fossil fuel effluent keep growing.
“Therefore, reduced dependence on hydrocarbon resources over the next century seems inevitable.
That notwithstanding, technology and discussions to date suggest that hydrocarbon will remain the dominant source of energy in the immediate future.
The increased level of uncertainties about oil and gas demands and the emerging technologies in alternative energy become important elements in making decisions on optimal exploitation of petroleum resources.” he said.
According to him, “This is more critical now that abundant hydrocarbons are being discovered in the most unconventional geological basins of the world.
I therefore wish to suggest that our concepts for this very important conference should include but not limited to provision of secure and economic energy supplies to meet expanding needs, responding to climate change that may arise from our choices, responding to the new normal that is caused by the COVID-19 pandemic and coping with the economic downturn globally.”
He said the country in the past few months, has faced challenges resulting to sudden slump in crude oil price, caused by the collapse in demand due to the COVID-19 pandemic and that low price and OPEC+ crude oil production curtailment have largely resulted to lower revenue generation for the Government.
Osinbajo stated that one of the current cardinal mandates of the Ministry of Petroleum Resources (MPR) is to drastically reduce the unit cost of crude oil production so to increase revenue generation, adding “It is imperative that in our current era of scarce resources, we should aim at a unit cost of production in single digits. Concerted efforts should be brought to bear to achieve and sustain this.”
Another key mandate of the Ministry is to ensure the growth of the country’s reserve base to at least 40 million barrels of crude oil, as well as the production capacity to 3 million barrels of oil per day, noted Osinbajo, and that government is fully committed to this mandate and confident that it will achieve the desired goal of finding more hydrocarbon deposits in the Nigerian Basins notwithstanding the curtailment in production.
There are assurances that production curtailment will soon be over as the world economy improves, he said.
In order to grow our reserves, he said government has proposed fiscal incentives that would attract investments in all basins in the Petroleum Industry Bill and the fiscal provisions for gas business will be one of the most attractive in Africa.
Therefore, opportunities abound for geoscientists, engineers and numerous other service providers in the shortest time to come, Osinbajo added.
However, in order to significantly grow Nigeria’s hydrocarbon reserves, there is the need to invest immensely in Research & Development so as to support the industry, said the Vice President.
“We need effective synergy and collaboration amongst Policy Makers, academic institutions, professional bodies, Oil & Gas Industry players and the Research & Development Centres to come up with innovative ideas and technology for cost effective exploratory and drilling activities. This is my expectation from your Association.” he charged.
