As Nigeria’s oil and gas sector awaits the passage of the Petroleum Industry Bill (PIB) to provide clarity on the terms of investments, the Minister of State for Petroleum, Dr. Ibe Kachikwu, has stated that the federal government would finalise four new additional policies in the sector by the end of October this year.
Kachikwu has also hinted that the proposed talks on output cuts by the Organisation of Petroleum Exporting Countries (OPEC) to ensure the rebound of oil prices would have limited influence on the prices as the cartel controls only 30 per cent of the global oil output.
Speaking yesterday in Lagos at a conference organised by the National Association of Energy Correspondents (NAEC), Kachikwu stated that the country’s oil and gas sector was faced with myriads of problems that required urgent solutions, stressing that the drop in oil prices was the least of the country’s problems.
Also speaking at the conference, the outgoing Managing Director and Chief Executive Officer of Nigeria LNG Limited, Mr. Babs Omotowa, disclosed that any tinkering of the Nigeria LNG Act of 2004 will violate bilateral agreements with international investors as well as cost the country a huge $25 billion in foreign direct investment (FDI) and fines running in billions at the international courts.
Kachikwu said the issue of cash calls deficiency had been his nightmare with $2 billion shortfalls, which had accumulated to arrears of about $6.2 billion.
“Every year, we lose 10 to 15 per cent of the joint venture production. There have been no new projects in the last five years and most of the projects touted cannot stand the current economic realities as they were based on $90 per barrel oil price. We are losing investments to our immediate neighbours,” he explained.
According to him, the drop in oil prices is a global problem that is not peculiar to Nigeria, adding that the country has more pressing problems, arising from the renewed attacks on oil facilities by the Niger Delta militants.
Kachikwu, who spoke on the topic: ‘The Urgency of Now’, revealed that while 3,000 cases of pipeline vandalism were recorded in the country from 2010 to 2015, the country had recorded 1,600 incidents between January and June this year, representing over 50 per cent of the incidents that occurred in five years.
He said the incidents of vandalism that occurred in the previous years had led to the loss of 643 million litres of petroleum products, amounting to N51.28 billion lost in 2015.
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