As the outcry against the payment of multiple fees in the oil and gas industry re-echoed in the ongoing Nigerian Oil and Gas 2025 (NOG) Conference in Abuja, the Neconde Energy Limited (OML 42) Acting Managing Director, & Gas Asset Manager, Engr. Chichi Emenike, said the multiplicity of fees is stifling the business.
Speaking with reporters on the sideline of the conference, she said, “There is multiplicity of fees. There are fees that must be paid in dollars. Sometimes it gets very stifling if you are not careful as a business person.”
Although the Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri had said in a panel session that there are 273 fees in the industry, which the federal government has engaged a consultant to harmonize in line with international best practices, she dropped the hint that the fees are as many as over 500.
Noting that “You can get discouraged,” Emenike commended the current administration, which has announced some changes with initiatives.
The Acting Managing Director said the government has has been trying to figure out how to attract financing but most of the funding has been from the private sector.
She however noted that the motive of every businessman is to make profit, stressing “Nobody is giving money for free.”
The Neconde boss, who was commenting on the ease of doing business in the country, sought the dismantling of operational hurdles.
His words: “It is not a Red Cross business. Now, the ease of doing business. We are talking about operational bottlenecks that need to be unbundled, if we are serious.”
She was opposed to the assumption that capital is blind, insisting that financing would rather go to a safe environment.
Emenike said 60 per of the gas her firm produces is supplied to the power sector.
She urged the Federal Government to look into the possibility of a cost reflective tariff for gas to the power in order to address the challenge of illiquidity.
According to her, the operators can only repay their debts to sustain their businesses with a cost reflective tariff.
Emineke revealed that the Neconde Energy (Operator of OML 42) which is a partner of the Nigerian National Petroleum Company Limited (NNPCL) has set up a gas commercialization strategy.
She added that before the year runs out, her firm would need to take a definitive Final Investment Decision (FID) for additional volumes.
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She said the plan for the FID is already contained in the recent Nigerian National Petroleum Company Limited report.
“It is going to take FID. So we have to take a definitive on the bigger gas volumes. On the smaller ones, we already have some things that we are doing,” she said.
The Managing Director noted that the firm produces crude oil and gas from the asset that was shutdown from Shell Petroleum Development Company (SPDC).
She recalled that the field that was shutdown upon acquisition, now produces about 50,000 barrels per day from four fields.
Commenting on the little beginnings of the firm, she said, “We started out with smaller volumes, obviously, 10,000, 20s.”
Emenike revealing plans for more volumes said, “Now we want to take some major – we have taken some FIDs, now some other projects that are going to ramp up the volume.”
