‘Oil and Gas Funding Hinged on Strong Corporate Governance’

Following the dwindling investment in Nigeria’s oil and gas sector as a result of the plummeting crude oil prices, an expert has said that strong corporate governance structures are critical to attracting funding for the development of the sector. Head of Energy and Natural Resources at FBN Capital Limited, Rolake Akinkugbe, made this known during the eighth edition of the annual sub-Saharan African Oil and Gas Conference 2015 themed: ‘optimising innovation and investment opportunities in the upstream, downstream and service sectors’organised by Energy and Corporate Africa, which took place in Houston, Texas United States. Speaking on the topic ‘SubSaharan Africa’s Re-shaped Oil and Gas Future’, which took a critical look at the current global dynamics on the Sub-Saharan African oil and gas industry she said: “In the current low-price environment, it will even be more critical for firms to focus on implementing strong corporate governance structures, and be flexible and willing to explore funding options that may be more dilutive from an equity perspective, than would have been preferred.” The presentation also highlighted the inherent challenges in the current scenario stating that “Local companies in sub Saharan Africa (SSA), could be particularly vulnerable without the right technical and financial capacity to quickly monetise reserves. It is at this juncture, that the search for valuable partnerships with experienced E&P firms and IOCs should quickly yield fruit.” She further noted that though oil prices would eventually recover, it was unlikely that the region would see the triple digit highs recorded prior to June 2014. “From a macro-perspective, there has been a structural shift for many of SSA’s crude oil exporting economies, as they cope with the significant fall in