The emergence of unconventional oil and gas resources from America, Europe, Asia, Middle East and even in some African countries, which has been impacting on Nigeria’s oil and gas industry, is a wake-up call for the country to reinvent its stagnating petroleum industry, experts in the industry have said.
As Nigeria faces keener competition, not just from the United States (U.S) which now has a glut of natural gas and light sweet crude, but also from its African counterparts who are working seriously on their new found conventional and unconventional resources, the need for Nigeria to invest in technology and human capacity development in the oil and gas industry has been stressed by the experts. They discussed the impact of the emergence of unconventional resources on the Nigerian petroleum industry at the 2013 annual Oloibiri Lecture Series and Energy Forum last Thursday.
They stated that Nigeria should focus on being competitive in the global market by improving its fiscal and regulatory framework to encourage investment and capital inflow.
They said Nigeria’s light sweet crude and Liquefied Natural Gas (LNG) exports are increasingly threatened as destinations for the nation’s supplies are being competed for, especially by the U.S. which according to them is closer to the market.
Natural-gas prices in the U.S. have fallen dramatically since 2008 highs, making them among the lowest in the world and attractive to buyers in Asia and Europe.
Diezani Alison-Madueke, minister of petroleum resources, said there was need for aggressive nation-wide data acquisition and investment in technology to explore Nigeria’s unconventional resources.
The minister, who was represented by Abdulkadir Musa, permanent secretary, Ministry of Petroleum Resources, said: “One of the key setbacks is lack of data, which is affecting many African countries. South Africa and Algeria already have data and Algeria is at the forefront having evaluated its unconventional resources.”
Omowunmi Iledare, professor of petroleum economics and policy research, Centre for Energy Studies, Louisiana State University, stated that Nigeria can curb the negative impact of the emerging unconventional resources in the global energy landscape if certain strategies are put in place.
“You can see what unconventional has done for the U.S. as it has now become a less attractive destination for Nigeria’s LNG exports.
“The competition is becoming keener. There are now over 25 countries in Africa producing oil; it used to be less than five.
“It is a wake-up call for us to think ahead and strategise. The lesson Nigeria should learn from the emergence of unconventional resources is how to invest in technology and human capacity for the sake of the future.”