The Energy Republic February Edition 2022

NIGERIA OIL AND GAS
PIA: A New Dawn for Nigeria’s Oil and Gas Industry - Sylva
The Minister of State for Petroleum
Resources, Chief Timipre Sylva,
pointed out clearly in his Keynote
address, during the 5th Edition of Nigeria
International Energy Summit (N.I.E.S) that
a new dawn has been ushered into
Nigeria’s oil and gas industry, the day
President Muhammadu Buhari signed the
Petroleum Industry Bill (PIB) into law.
According to him, it was a landmark
achievement and victory for all Nigerians.
“Before this landmark Act, Nigeria’s
petroleum industry was governed by the
Petroleum Act of 1969 and other obsolete
legislations.
“The President never concealed his desire
towards creating a more conducive
environment for growth of the sector and
addressing legitimate grievances of
communities most impacted by extractive
industries.”
The Minister added: “Let us not forget that
the PIB was introduced over two decades
ago. Despite the controversies and the
difficulties, the Buhari administration
believed that the concept, objectives and
long-term goals of the bill remained
impeccable as to warrant its efforts to rally
the legislature from different political and
ethnic divide for its passage.”
While the country was waiting for the PIA,
Nigeria’s oil and gas industry lost about $50
billion worth of investments.
H.E Timipre Sylva, Nigeria Minister of State
for Petroleum Resources
In fact, between 2015 and 2019, KPMG states
that “only 4 percent of the $70 billion
investment inflows into Africa’s oil and gas
industry came to Nigeria even though the
country is the continent’s biggest producer and
the largest reserves.”
He maintained that it is no brainer, therefore, to
see that the absence of the legal, governance,
regulatory and fiscal framework for the industry
contributed to the huge loss Nigeria has
witnessed.
However, with the assent of the PIA, President
Buhari has assured multinational oil companies
and global oil industry investment community
of adequate protection for their business
interest in Nigeria.
The nation’s energy industry is no longer
rudderless.
The PIA makes Nigeria competitive relative to other
oil and gas producing countries, especially among
its African peers.
Dissecting the PIA, the session looked at the journey
in the implementation of Act. Some aspects of the
implementation Evy may Maffini need more attention so that
the Act could deliver the expected benefits to all the
stakeholders.
Glacier makes
appointment in
Norway to grow
local business
The Minister submitted that the role of the two new
dual regulators will come under scrutiny while the
issue of the host communities will continue to elicit
frayed nerves and emotions.
“It is commendable that the PIA addressed the
relationship with host communities by creating the
Host Community Development Trust Fund (HCDTF)
to foster sustainable prosperity, provide direct
social and economic benefits from petroleum to
host communities, and enhance peaceful and
harmonious coexistence between licensees or
lessees and host communities. It may not be perfect
yet, but it is much better than where we are coming
from.”
Therefore, it is crucial for all stakeholders as well as
all arms of government to embrace the common
desire to make the PIA and its intended brief of
sanitising the oil industry a reality. It will hopefully
engender the enthronement of transparency and
openness to the sector, revolutionise the nation’s
oil sector and attract more investments to the
sector.
Why Oil Majors are Selling Assets and Leaving Nigeria — Kyari
International oil companies are leaving
Nigeria and shifting their portfolios to
where they can add value to the journey
towards carbon net-zero commitment, the group
managing director, Nigerian National Petroleum
Company (NNPC) Limited, Mele Kyari, has said.
Mr Kyari said this in a speech at the 2022 Nigerian
International Energy Summit (NIES2022) in Abuja
on Monday.
The NNPC group managing director says Nigeria
must have “the most friendly fuel” in place, while
building its ability to use renewables. Last year,
Royal Dutch Shell announced its plan to offload
onshore Nigerian oil assets in a bid to move to
cleaner energy.
It said it was discussing with the federal
government to sell its onshore oil assets in the
country. Also, Seplat Energy last week
announced it has entered into a contract with
Exxon Mobil, to buy Mobil Producing Nigeria
Unlimited’s entire oil assets in Nigeria.
H.E Timipre Sylva, Nigeria Minister of State
for Petroleum Resources
That includes all of Exxon’s entire shallow water
assets in the Niger Delta.
“Companies are divesting. They are leaving our
country. That is the best way to put it,” Mr Kyari
said.
“They are not leaving because opportunities are
not here but because companies are shifting their
portfolios where they can add value and not just
that, but where they can also add to the journey
towards carbon net-zero commitment.”
He said that transition must have sanity, and there
must be justice in the energy transition.
He said the country must have “the most friendly
fuel” in place in the next five to 10 years, while
building its ability to use renewables.
“We can’t do without financing and we also know
that there is a shortage of financing in this
respect,” he added.
“Therefore, for us in NNPC, we are here to serve
you. We are here to facilitate this process. We will
work with our partners, and of course, you are
seeing some of the consequences.
“We understand the necessity for divestment. We
do know that there are issues. We understand
that this must take place but also that it must be
done in such a way that we can deal with issues
around decommissioning and also make sure that
whatever arrangement that is put in place
ensures that we are also aligned along the energy
transition journey that we are going to.”
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THE ENERGY REPUBLIC I SPECIAL EDITION