Keeping businesses afloat in Nigeria’s downstream oil and gas sector has become extremely tough, especially after a pandemic era. A lot of companies have divested and the few existing ones have reduced their labour force to stay in business.
Despite these challenges, Nigeria’s indigenous firm Quest Oil & Engineering Services is expanding its midstream and downstream footprints across Nigeria with extensive investment in oil and gas infrastructure despite challenges.
The company is gradually rising from obscurity to arguably a major player in Nigeria’s energy sector with footprints such as aviation terminals in Lagos and Abuja, 50 million litres storage capacity at Oghara terminals for refined petroleum products, 35 retail stations, and a combined storage capacity of 35 million litres of petroleum products.
According to Quest, the real aim behind this growth drive is to avail Nigerians the opportunity to access top-quality fuel products at the right quantity and the right price, a vision behind the recent acquisition and subsequent rebranding of Ascon Oil Company into Quest Oil & Engineering Services Ltd.
“For the downstream sector to thrive, the people must come first. Nigerians have contributed so much towards the development of our economy; hence, they deserve value for their money,” Quest’s Chief Executive Officer, Benjamin Goke Dele said.
Nigeria’s oil sector is responsible for 90 percent of Nigeria’s foreign exchange earnings but contributes little to grow the country’s GDP which has remained in the one-digit margin, despite boasting of having Africa’s second-largest oil reserves with estimated known reserves of 37 billion barrels of oil and 5 trillion cubic metres of natural gas.
Most economists believe that to maximize social welfare, the prices of goods and services should be determined by the interaction of market forces.
In order to leverage on market opportunities, Quest which recently opened an ultra-modern retail service station at Iju, Agege in Lagos State, says that its promise to provide trusted retail services to Nigerians symbolizes its reinvigorated strategy for the Nigerian petroleum retail market.
“This is why we are making it our goal to ensure that every drop of fuel, diesel, or lubricant customers purchase at our service stations across Nigeria, are not just the best quality, but also the most accurate meter gauge,” Dele explained.
According to Quest, the real aim behind this growth drive is to avail Nigerians the opportunity to access top-quality fuel products at the right quantity and the right price
The Director-General /CEO of Lagos State Safety Commission, Lanre Mojola who was a special guest at the commissioning of the service stations says the infrastructure will play a critical role in the nation’s economy by providing energy and lubricating oils for vehicular transportation.
Mojola, who expressed optimism that the new addition will enable easier access to petroleum products within the Iju environment congratulated Quest Oil Group on the attainment of a milestone.
Regarding Occupational Health and Safety, Mojola implored the management of Quest oil group to always maintain international best practices as “this is the only way to ensure that the company is safe from accidents, incidents and avoidable fatalities that can drastically affect its bottom line”.
The DG further implored Quest Oil to continue to interface regularly with the commission in order to keep abreast with updates and reviews in safety regulations, policies and guidelines.
The Chief Operating Officer, Quest Oil Group, Ochuwa George stressed that one of Quest’s corporate goals is to provide affordable, clean, reliable and sustainable energy to all in line with the United Nations SDG 7.
“The launch of this service Station on Iju Road Lagos State is a step towards achieving our goal. We are on a constant quest for excellence as we provide the best possible service to our customers”, she added.
In line with the global journey for climate change, Quest Oil Group also has plans to provide alternative sources of fuel to its customers through the deployment of autogas infrastructures across its service stations.
This, the company believes, will lead to employment generation, and the creation of cleaner fuel sources which will reduce the cost of energy for Nigerians.
“Renewable energy is environmentally friendly, it reduces carbon footprints, and in a distributed form, it reduces operational cost, improves power reliability and leads to lower overall operational cost,” Quest’s CEO said.
He added, “We intend to migrate our customers who have fossil fuel-powered assets to renewables by providing a wider range of distributed energy solutions”.
He explained that this initiative would involve a mix of renewables, solar, turbines, wind, and energy storage systems to provide lean and low-cost energy solutions.
Quest also had a partnership deal with Lagos State Government to light up one of the largest local governments in Nigeria, maintaining over 1,000 street poles with street lights, a development that is part of the Light Up Lagos Project.
“Innovation is the only way forward in this industry, and that is what we latch our success to,’’ Dele said.
Most stakeholders say these investments are critical in revitalizing the Nigerian economy and more importantly, show that President Muhammadu Buhari’s current transformation agenda in the Energy, Oil, and Gas industry is already yielding fruits.
They noted that this development would not only enhance growth but boost investors’ and customer’s confidence in the downstream sector, especially at a time when Nigeria is going through major economic challenges occasioned by the current COVID-19 crisis, fluctuation in the price of crude oil, insecurity, and low investment,
Despite the challenges, playing regional dominance in West Africa petroleum products market will enable Nigeria’s downstream sector to act as an enabler to other critical industries such as petrochemical, construction, agricultural and industrial sectors.
“The West African market holds significant potential as refineries such as Ivory Coast, Gabon and Senegal cannot meet current demand for refined products in the region, estimated at 39 billion litres. There is an opportunity for potential uptake by neighbouring countries if the market has Nigeria’s refined products readily available,” multinational professional services network with headquarters in London, PricewaterhouseCoopers (PwC) said in a report titled Nigeria refining revolution.
PwC noted that this shift will see Nigeria become a net exporter of refined products and the refining hub of West Africa by the start of the next decade.
The advent of Dangote refinery – which is set to produce 650,000bpd of refined products – and other modular refineries will significantly impact the current landscape in the downstream sector.
When completed production from Dangote’s refinery will exceed domestic consumption levels and subsequently export excess refined products to neighbouring African countries.
Stakeholders have asked the government to speedy the kick-off of full deregulations of the downstream sector which has been crippled by poor pricing, obsolete regulations, undue government interference, harsh operating environment, dearth of infrastructure, insecurity, and other challenges, which continue to deter investment.
Other industry experts have also said the present precarious situation of the sector have taught Nigerian regulators that investment is no respecter of political parties, it only responds positively to business-friendly environment, where financiers are certain about the short or long term outlook of their investment, especially under a clear regulation backed by acts of parliament.
With a comprehensive, holistic and modern downstream sector, the federal government, especially the Buhari-led administration would not only achieve its campaign promises of lifting over 10 million Nigerians out of poverty through meaningful direct and indirect employment, but it will also develop by-products that would fast-track industrialization will be made available for sectors like agriculture.