Nigerian Oil Industry, Still At Primary Levels — FOSTER

Nigerian Oil Industry, Still At Primary Levels — FOSTER

The Facility for Oil Sector Transformation (FOSTER) has lamented that after over 50 years of crude oil exploration in Nigeria, the country’s oil industry was still at primary levels and had failed to develop to standards where it can rank among its peers.

Mr. Henry Adigun, Team Lead, FOSTER, who disclosed this at an interactive forum on reforming the Nigeria’s petroleum industry, said over the years, the petroleum industry had failed to make a meaningful contribution to the economic development of the country and had instead be bedevilled by widespread corruption and malfeasance.

He stated that over the years, only an insignificant fraction of the country’s population had benefitted from hydrocarbon exploration in Nigeria, while the lives of a large portion of the population was yet to be impacted by activities in the sector.

Also speaking, Chairman, House Committee on Environment and Habitat, Mr. Obinna Chidoka, lamented that Nigeria had failed to position itself to reap from the enormous benefits in the petroleum industry.

Specifically, Chidoka, who was represented by a member of the committee, Mr. Henry Nwawuba, pointed out that in the area of Joint Venture agreements, the country unwillingly ceded the entire operations of their oil assets to the Joint Venture partners, mostly multinational oil companies.

In turn, he said the country depend on these companies to determine the cost of operating the oil assets, and the quantity of crude oil and gas produced.
He stated that efforts should be geared towards ensuring that the country’s JV agreement is hinged on operations and monitoring in a way that would favour this country.
He called on stakeholders to partner with the relevant committees of the House of Representatives, especially the Committee on Environment and the technical Committee handling the Petroleum Industry Governance Bill, PIGB, so that when the law is passed, it would be reflective of the views of all critical stakeholders in the industry.

Speaking in the same vein, Mr. Akpan Ekpo, a member of the Expert Advisory Panel of the NNRC, said more emphasis should be placed on the local refining of crude oil, while ensuring that only the surplus quantity should be exported.

Ekpo, who is also former Director of the Central Bank of Nigeria, CBN, and former Vice Chancellor of the University of Uyo, declared that the Nigerian petroleum industry had been inefficient over the years and that despite several efforts, there had not been any positive change in the sector.

He said, “First of all, we should begin to emphasis more on refining our crude at home and then whatever surplus we have, we send abroad, like we did in the 1980s. People forget that, we used to refine our crude oil and use some. Right now, all we do is we keep exporting crude oil.

“Although the petroleum industry brings us revenue, we are not even sure it is enough, because its output is informed by foreign companies. That is why I argued that beginning from now, let’s use the oil money to build infrastructure, so that years to come, we can say oil money did this. Except we do that, we will not get much.”

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