• Saturday, May 18, 2024
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Divestment: IOCs’ assets to go to local companies – NNPC

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Better days lie ahead for indigenous oil companies in Nigeria, as the Federal Government has maintained that all divestments by international oil companies (IOCs) will be handed over to local companies.

Government promises that all the assets that have been slated for divestment would be awarded to indigenous companies, and that Nigerians should harbour no doubts over the exercise, as their interests would be given priority.

“There is no cause for alarm over the on-going divestment of petroleum assets by multi-national oil companies operating in the country, since those assets are readily taken up by indigenous operators, said Andrew Yakubu, group managing director of the Nigerian National Petroleum Corporation (NNPC).

Yakubu who made this assertion at the on-going Offshore Technology Conference (OTC) taking place in Houston, Texas (USA) said government would soon start the bidding process for some of the abandoned assets of the oil majors and that it is currently conducting a review of the assets.

He said the Department of Petroleum Resources, (DPR) has listed a number of the assets that had been neglected by the International Oil Companies and that they are receiving presidential attention. As soon as they are properly compiled, the bid rounds will commence and the assets will be made available to local investors, he added.

The NNPC boss observed that a lot of the oil assets that have been divested by the oil majors have mostly been abandoned and that it would bode well for local participants to take them over for exploitation and production of crude.

He observed that multi-national oil company, Shell ,divested about five assets which were taken up by indigenous operators, adding, “We also have other assets that are being listed for farming-in by indigenous participants because they have not received adequate attention by the IOCs”.

He observed that there had been more divestments by the IOCs, including Conoco Phillips, Total and Exxon Mobil, and that those assets were expected to end up in indigenous hands. “There is a conscious effort to build the capability and capacity of indigenous operators in the up-stream sector of the oil and gas industry. That is the good news,” he added.

He said Nigeria is very central and strategic in contributing to the energy mix of the world. “As at today, the country has over 36 billion barrels of crude reserves and 187tcf of gas reserves, and that makes us about the 12th largest reserves in the world,” he said, adding that the country has a very huge asset base and a very robust reserve-to-production ratio and that for a long time to come, it would remain central and strategic in the sub-Saharan sub-region.

“These reserves are spread across mainly the Niger Delta basin. There is of course additional potential which has not been exploited and it is estimated that we are going to strike almost 600tcf of gas,” he said.