Nigeria Sees Slump In Oil Prices As Growth Opportunity  

Dr. Baru, 2nd from right, speaks during a panel discussion on “Investment in the Oil Industry”, on the sidelines of the ongoing 7th OPEC International Seminar in Vienna, Austria, Thursday

Despite slump in oil prices, the Nigerian National Petroleum Corporation (NNPC) has outlined plans to attract private investments, ensure sustainable development and spur growth in the nation’s oil and gas industry.

Dr Maikanti Baru, Group Managing Director of the NNPC while speaking on the theme “Investment in the Oil and Gas Industry” at the 7th International Seminar of the Organisation of the Petroleum Exporting Countries (OPEC) in Vienna, Austria on Thursday said investment in the industry had become imperative in the wake of recent price turbulence, supply driven glut, world economic growth, uncertainties regarding oil’s future, as well as the fiscal imbalance experienced by OPEC member nations.

These challenges Dr Baru said, have also created new wave of opportunities for the corporation because oil is expected to remain the dominant fuel in the energy mix, contributing between 52-53percent of the global energy requirement over the next 15 years.

He said NNPC recognized the challenge as well as the opportunity presented by oil demand growth, particularly as an exporter experiencing a surge in local demand.

“The balance of objectives requires that we undertake a paradigm shift in our business model to ensure that we attract capital and sustain flow of investment. It has also placed a burden for change towards broadening the base of investment sources outside traditional government funding,” he said.

“We have had about $3.6bn in investment so far. The PIB is undergoing serious legislative process. We segmented it into four and one has been passed. The downstream holds the future. We are looking at revamping our refineries and calling on investors to come and establish refineries. We are also looking at job creation across the entire value-chain,” he told participants at the Seminar.

He further added that the execution of $1bn contractor financing deal with Schlumberger for the development of oil fields in the Niger Delta; aggressive investment in infrastructure; tripling of domestic gas supply from 500mmscf/d in 2010 to about 1500mmscf/d currently, as well as completion and commissioning of 600km of new gas pipelines are notable milestones.

“The recently sanctioned $2.8 billion, 614Km Ajaokuta-Abuja-Kaduna-Kano (AKK) pipeline project is a demonstration of commitment to investing in local gas development, he stated.

Dr. Baru said NNPC’s goal to become a net exporter of refined products by year 2019 was on course as there are ongoing discussions to revamp all the four (4) existing local refineries through utilizing private capital in form of a contractor financing model.

Running for the 7th edition since 2001, the OPEC International Seminar is one of the premier events on the world energy calendar which provides a platform for dialogue by Ministers from OPEC Member Countries and other oil-producing and oil-consuming nations, as well as CEOs of IOCs, industry leaders, academics, energy experts and the specialized media.

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