The Country Chairman/Managing Director of TotalEnergies Nigeria, Matthieu Bouyer has advanced reasons why the Deep Water segment of the oil and gas industry in Nigeria is stuck for 10 years.
Recall that there is no Final Investment Decision (FID) taken by the International Oil Companies (IOCs) for deep water projects in Nigeria since the Egina FID which was taken some years ago.
Speaking during a panel discussion on Wednesday titled: “Defining The Outlook For Deep-Water Exploration And Production in Nigeria”, Bouyer blamed this on lack of contractors, competition, and high operating costs in the industry.
He explained that many contractors left the country and that has increased the lack of competition in the sector.
To increase competition in the sector, however, Bouyer said, the government needs to understand why they left and to put some measures in place to bring them back.
On increasing production in the light of comparatively high operating costs and competing regional markets, he said, even with the fiscal incentives, if the costs are too high, investment will not be possible, therefore, there is need for competition to drive down the costs.
Bouyer said, “Today each Company capable to work in deep water is benchmarking these opportunities vs Portfolio alternatives.
“As Capex are capped, arbitration are made. So it’s important to be competitive and agile to accommodate requirements.
“Resources will not disappear, they are here but they will be pushed to a later stage while the country needs them now”, he added.
On what to do to move the deep water oil and gas sector forward, the TotalEnergies boss said, when a sound measure is taken investment will come in.
He, therefore, applauded the Federal Government for the Executive Order issued in March, with which they managed to sanction the Ubeta Project in June.
