Passing the PIB Will Attract New Investment – ED/CFO
The need to pass the Petroleum Industry Bill (PIB) as an important requirement for attracting new investments to Nigeria’s oil and gas sector was the focus of a presentation by the Executive Director, Finance & Control & Chief Financial Officer, Total upstream companies in Nigeria, Tai Oshisanya, at this year’s Oloibiri Lecture Series and Energy Forum (OLEF), which took place at the PTDF Building, Abuja on Thursday, March 18, 2021.
Speaking on the topic: “Environmental, Social and Governance (ESG) Dynamics and Industry Projects Financing – IOC Perspective, Mrs Oshisanya pointed out that as the world seeks a cleaner environment by reducing greenhouse gas emissions, the oil and gas industry must respond with a cleaner, efficient, affordable and sustainable energy mix.
“Total is a leader in this broader energy transition. We have taken remarkable steps and initiatives to reduce our Carbon Footprint and have set an ambition of a ‘Net zero carbon emissions by 2050’. We want to reduce our greenhouse gas emissions from all our facilities from 46 metric tonnes of carbon emissions of CO2 in 2015 to 40 metric tonnes in 2025. This, we can’t do without funding. International lenders no longer want to be brown companies but as green companies, putting their funds in clean energy. But we know we still need oil and gas to fund the cleaner energy space as well,” she explained.
Mrs Oshisanya added that because the industry is transitioning from oil and gas to renewable energy, there is a need to “ensure that our fiscal regimes and regulatory regimes are stable to be able to attract new investment into these areas. Therefore, we welcome, very much, that the government is now very enthusiastic in passing the PIB because that will attract new investment in deep offshore and gas development sectors.”
In his goodwill message, the Minister of State for Petroleum Resources, Timipre Sylva reiterated that the Covid-19 pandemic had broadened the need for operational excellence and that the Federal Government was equally considering the granting of a regulatory forbearance to banks to restructure terms of facilities for oil and gas investors that might, currently, be grappling with debt servicing challenges.
“The PIB is now before the National Assembly and when passed into law will not only guarantee a robust framework beneficial to both government and investors but will also unlock several midstream gas opportunities to further enhance domestic gas utilisation. I advise you to reposition yourselves for the implementation of the upcoming industry change,” Mr Sylva said. He was represented by his Chief of Staff, Moses Olamide.
Contributing to the discussion from an industry operator’s point of view, the Group Managing Director, Nigerian National Petroleum Corporation (NNPC) Mele Kyari, who was represented by the Corporation’s Chief Operations Officer, Upstream, Adokiye Tombomieye, made it known that currently, oil and gas operators worldwide are developing strategies to manage rising costs from the Covid-19 pandemic.
“The challenges posed by the energy transition in the industry made the operators in the industry to make a bold choice. A quick intervention strategy was adopted across the industry: to reduce the unit operating cost through deliberate efforts, notably renegotiation of all ongoing contracts, deferment of capital spends and, of course, process optimisation. Companies must identify ways to diversify their portfolios. In Nigeria the focus has been on increasing oil production, growing domestic gas utilisation and maturing hydrocarbon reserves. We in NNPC are also determined to increase the downstream market share to guarantee energy security, investment in petrochemicals and fertilizer plants,” said the GMD NNPC.
The Director, Department of Petroleum Resources (DPR), Auwalu Sarki gave an industry regulator’s opinion on the need to have less penalties as incentive for portfolio optimisation, adding that “we want more royalties and not penalties. Our aim is to ensure industry guidelines are issued with international best practice.”
Earlier in his welcome remarks, the Chairman SPE Nigeria Council and Total’s Executive General Manager, Deep Water GSR & Planning, Olatunji Akinwunmi said: “This is the 30th edition of OLEF. It is the first time we are holding this event as a hybrid event. It is our hope that the platform provided by OLEF will stimulate further development and growth within the oil and gas industry in Nigeria.”
The OLEF, organized by the Nigeria Council of the Society of Petroleum Engineers (SPE), was attended by local and international oil and gas industry leaders and other stakeholders who tackled the theme Operational Excellence and Portfolio Optimization: way forward for the Oil and Gas Industry post Covid-19.
Total staff have through the years participated in the Oloibiri Lecture Series and Energy Forum which is an annual lecture series focused on contributing to the oil and gas policies development for Nigeria in commemoration of the first oil-well drilled in Oloibiri, Bayelsa State in Nigeria.