By Ndubuisi Micheal Obineme
The Independent Petroleum Producers Group (IPPG) wholeheartedly endorses the recent Executive Orders signed by President Bola Ahmed Tinubu GCFR, aimed at revitalizing investment in Nigeria’s oil and gas sector and positioning the nation as Africa’s premier investment destination within the energy sector.
In a statement signed on behalf of the IPPG by its Chairman, Abdulrazaq Isa, OFR, the group stated that President Tinubu’s policy directives, include the introduction of value adding fiscal incentives for investments in upstream non-associated gas (“NAG”) developments, midstream infrastructure, and deepwater assets. The orders also streamline the industry’s contracting process, and seek to reform local content practices. All of these measures are pivotal to the future of the industry and have in-fact been recommended by the industry for many years.
“We are encouraged to see swift progress within a relatively short period of time. We believe these actions will directly result in the following benefits for Nigeria and the oil and gas industry: Reduced project cost; Faster project execution timelines; Reduction of waste, and multiple layers of middlemen in project contracting processes; Increased number of gas projects reaching Final Investment Decision (FID); Increased gas processing and gas distribution capacity, as gas infrastructure investments grow; and Increased gas supply for domestic use (including power, cooking gas, etc.) and for export”.
IPPG stated that it stands ready to collaborate with the government and all stakeholders to ensure the successful implementation of these directives.
“We believe these reforms will attract more investments into our sector, accelerate project completions, and ultimately, contribute to the prosperity of all Nigerians”.
The global oil and gas industry continues to contend with limited availability of capital, and uncertainty as to the evolution of future demand. In the past, Nigeria often unintentionally compounded these challenges and delayed investment by inserting the government between willing private sector counter-parties. This is recently evident in the delayed approval of recent IOC divestments, the stalled progress in taking FID in the outstanding upstream Deepwater projects as well as gas resource & infrastructural development projects.
“President Tinubu’s policies suggest a new direction that prioritises Nigeria’s strategic interests, ensures that we can harness our vast gas resources effectively and recognises the role of the private sector in driving growth.
These Executive Orders are credible impetus required to re-launch the growth of production and revenue from the oil and gas industry, and marks a significant milestone in our journey towards achieving our shared goal of energy security and economic stability for all Nigerians”, IPPG concluded.
The IPPG is a twenty-eight (28) member association of indigenous Exploration and Production companies committed to the advancement and sustainability of the Nigerian oil and gas industry. IPPG advocates for policies that support the growth and development of the sector, ensuring Nigeria’s position as a leading energy provider globally.