November 2020 Edition

NAPE WEBINAR SERIES August Edition
Fiscal Regime Design, Government Revenues,
and Investors' Interest in Nigeria's Oil & Gas Sector
Timipre Sylva, Honorable Minister of State, Ministry of Petroleum Resources
Question: Are there timelines for the
passage of the PIB?
Answer: It is a law that has been very long in
the making, some say it started in 2000
others 2003, it is instructive to me that when
it is passed it will be a stable fiscal
framework and not prone to amendments
in next few years. I can give you an answer
in relation with what we are doing. For us
we have finished our job, the drafting
process is concluded, the ministry of
Justice is looking at the draft to make sure it
is not in conflict with existing laws. How long
it takes with the National Assembly, I cannot
say.
Question: What is the status of
monopoly on gas pipelines?
Answer: The bill is trying to avoid monopoly
in any sector. The bill is going to
democratize every sector. The bill will also
encourage activities in the midstream
sector which is really nonexistent now.
Question: On Carbon – neutrality, is
there a clear strategy to address it?
Answer: On green energy we have to be
cautious, we don't have the funding
capacity for the renewable energy
research. I read somewhere that the
European union voted one trillion dollars for
renewable energy. We cannot participate in
that race at the moment because we are not
financially strong enough. But one of the
ways we can participate in cleaner
energies, is first develop gas, a cleaner
energy that we have abundantly to develop
the base load energy and address the
energy shortage. More than 500,000
people without access to energy live in
Africa. We have to get through to them with
what we have now. I would like to see the oil
and gas industry fund research into
renewable energy.
Question: Is the national pipeline grid
still in the cards to help in evacuation of
gas?
Answer: On the national pipeline grid, we
are trying to commercialize it. We want to
enable private investors to take over the
m i d s t r e a m w h e r e c o m m e r c i a l
consideration drives the sector. We are
opening up opportunities for all investors to
build the grids and earn money from them.
Question: Your thoughts on Nigeria's
production target of 3 million barrelso
i l - p e r - d a y ( B O P D ) c a p a c i t y ,
mechanisms for block allocation and
marginal fields bid rounds.
Answer: We had a mandate to take
production to 3 million barrels (BOPD), but
the pandemic and OPEC cuts have not
helped. We expect production additions
from the new Marginal fields, new projects
such as the Bonga-South West fields will
add to our National production. We have
incentives for small producers as well. We
also expect that marginal fields will also
help us develop in-country local capacity.
There will be a major Oil block bid round,
but it will come after the PIB.
Question: Nigerian Operators spend
f o u r ( 4 ) t o fi v e ( 5 ) t i m e s t h e i r
contemporaries globally and this driven
primarily by security challenges, what
are your thoughts?
Answer: This is a bit more personal for me
as indigene, I come from this region of the
country. Unfortunately, a few environment
developments in this region invariably
promoted issues that have become
intractable and we have not gotten over. A
lot of money is being spent not related and
with no links to security issues and
challenges. A lot of money is being spent
on NDDC to bring stability in the Operating
environment i.e. oil producing host
community areas, but there is no link
between NDDC and the oil industry. The
same for the Amnesty programme. We
need to build linkages. Oil companies are
spending a lot on security that becomes
OPEX and these are passed on to the
Government (JV or PSC). Government is
suffering double jeopardy.
As an industry we must come together to
develop sustainable solutions to this
specific challge.
Question: Your parting shot
Answer: I like this engagement and
collaboration between government and
industry that move the industry forward. We
should see ourselves as one and all on
same side to find solutions that advance the
industry, promote issue-based R&D and
address security challenges so that we can
take control of our destiny.
This NAPE Webinar August Edition was
sponsored by Dharmattan Nigeria Limited.
Mr. Bashir Koledoye, Founder and
Managing Director of Dharmattan Nigeria
Limited gave the sponsors remarks. He
highlighted that the insights by the Minister
provided good news for the industry. Mr.
Koledoye stated they are pleased to
partner with NAPE to enable forums that
bring issues that affect the oil and gas
industry to the public. And Dharmattan will
be glad to partner with NAPE again and
again.
Mr. Alex Tarka, FNAPE, President NAPE
on behalf of the Association appreciated
the Honorable Minister of State Petroleum
Resources and all contributors to this indepth
oil and gas interview session. The
NAPE President in his closing remarks for
the webinar stated that NAPE will continue
to provide the platform for stakeholders to
promote the advancement of the industry
as the premier Nigerian oil and gas industry
professional association.
** The Honorable minister of State's
Presentation and the full NAPE Webinar
August edition is available on the NAPE
YouTube Channel, NAPE NIGERIA. **
NAPENEWS | NOVEMBER 2020 | 54