Weaning Nigeria from oil
DOES NIGERIA HAVE THE capacity to thrive without oil, especially with the ongoing crisis in the global oil market? The answer to this question is a mystery yet to unravel, especially now that state-owned oil company, Nigerian National Petroleum Corporation...
DOES NIGERIA HAVE THE capacity to thrive without oil, especially with the ongoing crisis in the global oil market? The answer to this question is a mystery yet to unravel, especially now that state-owned oil company, Nigerian National Petroleum Corporation (NNPC) is taking efforts to claw the nation out of its addiction to oil with $10 billion worth of investment currently ongoing in the nation’s energy sector.
For several decades, the country has remained unable to delist itself from one of the most energy impoverished nations in the world and in spite of its willingness to align with the push for renewables, it is now focused on using its oil and gas resources in developing infrastructure until the commodities become irrelevant in the next few decades.
Mele Kyari, group managing director, NNPC, speaking at the Atlantic Council Global Energy Forum, 2021 on the topic, “Delivering Energy Access in the Developing World,” pointed out how Nigeria with significant gas reserves, has approximately $3 billion to $4 billion projects ongoing currently, some of which are at advanced stages, in the efforts to rev up production for domestic use and for export.
“We are not a petroleum country in real sense. It’s agreed that we have the 10th largest reserve of oil and a significant gas reserves. Of course, what everybody recognises is the oil. The reality today is that we have a country in excess of 200 million people. Seventy per cent of this population is well below 30, with a growing middle class and one of the fastest-growing economies in Africa.
“More importantly, for us today, an energy deficient country, over 60 per cent of our country is not electrified, the poverty level is very high, extremely challenging. But so much is going on to see how we can reverse this trend. When you combine all these, you will see that as a country of focus today, many things are happening in the energy sector.
“For instance, we are seeing investment in our energy infrastructure, especially in the area of gas in excess of $10 billion; this is ongoing. There are a number of gasbased projects about $3 billion to $5 billion and some of them are at the Final Investment Decision (FID) stage,” Kyari told his audience.
The federal government’s recent plan geared towards deepening domestic gas consumption has led to heightened activities in compressed natural gas (CNG) and liquefied petroleum gas (LPG), which are at the core of policy to deploy resources in the right places. But the NNPC boss did also explain that there are forecasts that state that in 30 years the world will still have at least 100 million bpd of oil consumption.
“Oil and gas will still remain relevant in the near future, but the transition is real. What countries and nations are doing is to move towards much cleaner fuel and this cleaner fuel is clearly gas and that’s why we as a company we are focused on gas resources, making sure to supply the domestic market and create opportunities for export.
So, what we see, as an energy resource-based country, is to utilise the available resources of today to create the enabling environment for growth and prosperity in the country and that clearly aligns with the reality on the ground.
“We have significant goodwill and understanding across countries, nations and companies. For instance, we have significant engagement with the United States Department of Energy in the sense that we receive some support in our transition to cleaner fuels so that we can develop our gas infrastructure, so that we move away from the liquids to gas ultimately,” the NNPC chief stated.
That Nigeria is gradually moving away from its dependence on oil means a lot for the country, but the realities it is faced with in achieving this involves developing resources that can sustain such a shift which deeply calls for having adequate infrastructure to uphold it.