Nigeria is tying down about 875,000 barrels per day of crude on account of delay in signing final investment decision (FID) on at least eight oil and gas projects that are just waiting for the government to give the go-ahead to the promoters to commence execution.
The projects are Bonga Southwest/Aparo with an estimated production of 250,000 bpd; Bonga North 100,000 bpd; Bosi Satellites Fields phase II 80,000 bpd; Uge 11,000 bpd; Zabazaba 120,000 bpd; Nsiko 100,000 bpd, and Bosi 140,000 bpd.
Train 7 of the Nigeria Liquefied Natural Gas (NLNG) Limited had its letter of intent signed with contractors recently and Mele Kyari, group managing director of Nigerian national Petroleum Corporation (NNPC), said the FID would be signed at the end of October.
“This is indeed the wish of NNPC as a shareholder and I will like to reaffirm to you all our support to carry out all the realignment to make the project a reality,” Kyari said.
If the projects, whose cost is estimated at $100 billion, were up and running, they would generate additional 875,000 barrels of crude oil per day (bpd).
The Federal Government has said it plans to sign FIDs on at least four oil and gas projects by the end of this year.
Timipreye Sylva, minister of state for petroleum, said this when he represented President Muhammadu Buhari at 24th World Energy Congress (WEC) in Abu Dhabi, United Arab Emirates.
Sylva said his vision was to bequeath a vibrant petroleum industry which would guarantee long-term strategic investments and prosperity for Nigerians.
“My plan is to ensure that during my tenure, four Final Investment Decisions (FIDs) are taken. I am sure that within the next quarter, we should be able to conclude on some of these FIDs so as to grow the industry,” Sylva said.
Stakeholders in the oil and gas industry have urged the government to match words with action, saying the delay in approving projects has caused the country great loss.
If the government could sanction the execution of these projects, they said, Nigeria would be closer to producing about 3 million barrels per day of crude.
The industry stakeholders said ensuring the taking of FID on some of the pending projects would help to boost the economy as it would create several thousands of jobs.
Tosan Omatsola, principal and executive director, Kaptepla Capital, said Nigeria needs to attract investors by creating enabling environment, adding that there is no reason why the country should not be producing 4 million barrels per day of crude oil if the enabling environment is there.
“The government should make the fiscal and contract terms more attractive for investors,” he said.
Seye Fadahunsi, a former executive director of Pillar Oil, said signing FIDs would increase activities in the oil and gas industry, improve the nation’s oil production output and have ripple effect on the economy.
He said the process of getting projects approved in the country is too long and it has had serious implications on investment in the industry.
Godwin Izomor, managing director and chief executive, MG Vowgas Limited, said ASA North gas project is almost finalised and it would be a big boost to the economy by the time the final investment decision on the project is done.
According to him, the trickle-down effect of such decision by the government would trigger off a lot of activities in the industry and this would also affect the common man on the street.
OLUSOLA BELLO
