The Federal Government has called on International Oil Companies (IOCs) operating in Nigeria to ramp up investments in the country’s oil and gas industry.
Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, made the call at the Cross Industry Group (CIG) Meeting held in Florence, Italy, organized by IOCs operating in Nigeria.
Senator Lokpobiri, in a statement on Tuesday by his Special Assistant on Media and Communication, Nneamaka Okafor, affirmed that the administration of President Bola Ahmed Tinubu has provided every necessary incentive to ensure seamless and profitable operations in the country.
According to the statement, the meeting focused on challenges, expectations, and strategies to enhance the sector’s contributions to domestic energy needs and regional expansion across Sub-Saharan Africa.
Speaking at the event, Sen. Lokpobiri noted that while IOCs have pointed to Engineering, Procurement, and Construction (EPC) contractors as a challenge, EPCs will only commit when they see strong 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,” the Minister stated.
He further emphasized the need for IOCs to support local refining efforts, noting that more refineries are coming on stream and will require a steady supply of crude oil. To make this easy and possible, he stressed that ramping up production will enable Nigeria to meet both local and international obligations.
In line with the Federal Government’s drive to boost production, Sen. Lokpobiri reiterated that the Federal Government will 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 said.
The Minister also urged operators to consider farm-out agreements where assets are close to existing infrastructure, rather than incurring high costs on new Floating Production Storage and Offloading (FPSO) units.
The Chairman of the Oil Producers Trade Section (OPTS), Mr. Osagie Osunbor, commended the Minister for his direct engagement with industry players and for the Federal Government’s continued efforts in advancing 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 stated.
The Federal Government remains committed to ensuring a thriving oil and gas industry and expects operators to match its commitment by making tangible investment decisions that will drive growth, sustainability, and national energy security.
