FG seeks more investments as oil production drops to 1.3mbpd

Sen. Heineken Lokpobiri, Minister of State, Petroleum Resources (Oil), has called for more investments in the oil and gas industry to ramp up production and boost foreign exchange earnings.

Lokpobiri made the call on Tuesday at the Nigerian Oil and Gas (NOG) Energy Week currently held in Abuja.

The country has over 37.5 billion barrels of proven crude oil reserves and 209 trillion cubic feet (tcf) and 600 tcf of proven and contingent gas reserves, respectively.

The Independent Petroleum Producers Group (IPPG) says Nigeria finds itself in a situation where its daily production has significantly dropped to about 1.3 million barrels of oil and 8.5 bcf of gas.

Lokpobiri, in an opening address, blamed the development on a lack of drilling investments in the sector and disclosed that efforts were ongoing to change the narrative by attracting more investments into the sector.

“We have been working hard to ramp up production. The overall objective is to increase production.

“It is when we ramp up production that we will be able to get the required forex inflow into the country, get money to fund the budget, and satisfy energy demand.

“But you can only increase production by increasing investments,” Lokpobiri said.

Mr. Ekperikpe Ekpo, Minister of State, Petroleum Resources (Gas), said in an address that the Ministry had been instrumental in implementing reforms that made Nigeria an attractive destination for investors.

He said the Petroleum Industry Act (PIA) 2021 and the recent Presidential Directive for Oil and Gas Companies on Tax Incentives, Exemption, and Remission, among others, by President Bola Tinubu, created a conducive environment for investment.

“The regulatory frameworks now in place incentivize investment, streamline bureaucratic processes, and provide clarity on fiscal terms,"  he noted.

Earlier, the Chairman of IPPG, Mr. Abdulrazaq Isa, had sought measures by all relevant stakeholders to address the dwindling production level and underinvestment in the oil and gas industry.

He said that in spite of the nation’s world hydrocarbon resource base, with over 37 billion barrels of proven crude oil reserves and 207 tcf and 600 tcf of proven and contingent gas reserves, respectively, daily production had dwindled.

He expressed worry that daily production had significantly dropped and stood at about 1.3 million barrels of oil and 8.5 bcf of gas today.

“This is way below our capacity as a nation, and by all globally acceptable standards, this reserves-to-production ratio is extremely low and a clear indicator that the industry is in a dire situation.”.