The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has said that indigenous companies contribute about 30 per cent of crude oil and 20 per cent of the gas production, as well as 40 per cent and 32 per cent of oil and gas reserves in Nigeria respectively.
Speaking on the subject IOC Divestments – Nigeria’s Energy Security, And the Role of the IPPG In This New Mix, at the Chief Executive Officer of NUPRC, Engr Gbenga Komolafe, further said 7 indigenous companies are among the 20 companies with the highest oil reserves in the country.
According to him, over 23 assets were divested by the IOCs between 2009 to date presenting an opportunity for acquisition by indigenous companies.
“Fifty-seven fields were offered for awards in 2020 to indigenous operators, resulting in the issuance of 102 Petroleum Prospecting Licenses (PPLs) by the Commission on the 28th of June 2022.
“It is worthy to note that Nigeria, has the largest participation of local independents in the domestic oil and gas industry activities of all petroleum producing countries in Africa arising from the robust local content policy.
“Consequently, the divestments of the IOCs away from our onshore and shallow water terrain present a massive opportunity for new operators of those assets, in which the IPPG is better positioned to take advantage of in order to meet the increasing energy demand.
Komolafe urged the indigenous players not to see the divestments as a threat to new investments in the sector rather, it is due to the hostile upstream petroleum environment arising from crude oil theft and energy transition as a global response to the advocacy for reduction in carbon emissions.
He said: “Ladies and Gentlemen, the Commission expects the IPPG to stay competitive, optimise future energy security and be resilient in our oil and gas extractive industry. The IPPG should adopt an innovative and pragmatic approach towards operational excellence to include decarbonisation and improvement in cost efficiency; creation of enabling environment with their host communities and utilization of appropriate skills and capabilities.
“In this new mix, the IPPG is expected to have an increased focus on natural gas exploitation and utilization. As you position to take the opportunity being presented by the divestments, the need to be prepared to make the necessary investments for gas pipeline infrastructure, gas processing facilities, meeting domestic gas delivery obligations to strategic sectors of the economy, and global gas export requirements should be in focus. Again, on the part of the Commission, we shall provide the requisite regulatory support in line with the provisions of the PIA 2021. It is encouraging that Section 52 in the PIA provides for the establishment of the Midstream and Downstream Gas Infrastructure Fund.
