To attract fresh investments into the petroleum industry and encourage exploration for new oil finds to grow the oil and gas industry, the Nigerian National Petroleum Corporation (NNPC) is planning to resolve the lingering fiscal issues hindering the growth of the industry.
Its Group Managing Director, Mallam Mele Kyari, stated this while fielding questions from reporters at the just-concluded conference of the Society of Petroleum Engineers (SPE), Nigeria Council held in Lagos.
Kyari said the corporation will engage its joint venture (JV) partners and the government to resolve the knotty issues.
He noted that NNPC will fully embrace technology to drive its operations considering the direction of the industry. He said: “Today, Artificial Intelligence is leading digital transformation across the oil and gas industry, from exploration to production and facility management. And many oil companies have taken advantage of this to enhance operations’reliability and profitability.
“Technology and innovation will, therefore, continue to shape the way we do our businesses, especially in the deep offshore and other hard to operate environments.Artificial Intelligence, Big Data and Mobile Technology will continue to shape our industry in practically unimaginable ways, but certainly the transformations it promises will lead to quantum shift in the delivery of our task.”
For the NNPC, Kyari said: “We are getting to the point of using technology to address challenges and advance growth of the oil industry but there is significant room for improvement. Certainly, we have done so much in the industry to believe that we have got to a level that doesn’t need other proportions.”
On developing the oil and gas industry appropriately, the NNPC chief said: “There are fiscal issues that we need to resolve and we are engaging our partners and government so much to make sure those fiscal issues are resolved so that at the end of the day, people will have the basis of investment clear to them.
“We will also engage our partners to make sure that the assets that need to be divested are done as quickly as possible so that we can reduce some of the challenges that had inhibited investment in this industry.The combination of these two will take us there.”
On whether the government will sell the refineries to private sector investors to make them efficient, Kyari said government will not sell the refineries but assured that NNPC will make the refineries operate at reasonable capacity. “First, we have to rehabilitate our refineries and make they operate at minimum of 90 per cent capacities. Secondly, we (NNPC) will make sure others that have such initiatives to put in place new refineries are supported by way of either providing them feedstock or all the necessary support to make sure such refineries come on stream and also make sure when they produce we take these products from them.”
On the financing option the corporation will choose to carry out the refineries’ rehabilitation, he said: “We can do equity or third party financing and other options,” adding that the NNPC is to also resolve fiscal issues around investment environment and make sure its priorities are clear and it will plan with its JV partners, so they can get back to exploration.
Kyari said taking steps to grow reserve, expand the frontiers of our production as a country requires enabling environment to attract the investment that is being subdued by our fiscal regimes but noted that the corporation is optimistic that this government under the leadership of President Muhammadu Buhari is determined to deliver a stable fiscal environment to support the needed growth in the oil and gas sector.
“The oil and gas industry is dynamic and must remain so in order to survive frequent disruptions associated with changing economic, social, political environments,” he added.
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