The Federal Government has called on International Oil Companies (IOCs) operating in Nigeria to scale up investments in the country’s oil and gas sector, stating that President Bola Ahmed Tinubu has provided all necessary incentives to ensure smooth and profitable operations.
Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, made this call at the Cross Industry Group (CIG) meeting in Florence, Italy, organised by IOCs operating in Nigeria. A statement from his Special Adviser on Media and Communication, Nneamaka Okafor, noted that the meeting focused on challenges, expectations, and strategies to enhance the sector’s contribution to domestic energy needs and regional expansion across Sub-Saharan Africa.
Speaking at the event, Lokpobiri acknowledged concerns raised by IOCs regarding Engineering, Procurement, and Construction (EPC) contractors but stressed that EPC firms would only commit if they saw firm investment decisions from industry players.
“The government has done its part by providing the requisite and investment-friendly fiscal policies, including the President’s Executive Order incentivizing deepwater investments. Now, the ball is in the court of the IOCs and other operators to make strategic investment decisions that will drive increased production and sustainability in the sector,” he stated.
The minister underscored the importance of IOCs supporting local refining efforts, pointing out that more refineries are coming on stream and will require a steady crude oil supply. To facilitate this, he emphasised the need to ramp up production to meet both local and international obligations.
In line with the government’s drive to boost production, Lokpobiri reiterated that the Federal Government would begin implementing the drill or drop provisions of the Petroleum Industry Act (PIA) where necessary.
“We cannot continue to have assets sitting idle for 20 to 30 years without development. If you are not utilizing an asset and it remains underdeveloped for decades, it neither adds value to your books nor to us as a country.
“We encourage industry players to explore collaborative measures such as shared resources for contiguous assets, farm-outs, and the release of underutilized assets to operators ready to invest in production. Otherwise, like any responsible government, we will take back these assets and allocate them to those willing to go to work,” he stated.
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He urged operators to consider farm-out agreements where assets are close to existing infrastructure instead of incurring high costs on new Floating Production Storage and Offloading (FPSO) units.
Chairman of the Oil Producers Trade Section (OPTS), Osagie Osunbor, commended Lokpobiri for his direct engagement with industry players and the Federal Government’s ongoing efforts to advance the sector.
“We appreciate the government’s commitment to creating a conducive environment for investment. The Minister’s engagement has provided critical insights and has also challenged us as industry players to step up efforts to increase production,” Osunbor said.
The Federal Government reaffirmed its commitment to fostering a thriving oil and gas industry and urged operators to reciprocate by making tangible investment decisions that would drive growth, sustainability, and national energy security.
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