Nigeria: Reforms in Petroleum Sector Attracted U.S.$130 Billion Foreign Investments in 4 Years - Kachikwu

The former Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu has said the federal government's reforms in the petroleum sector in the last four years yielded over $130 billion foreign investments and commitments aimed at growing the sector.

Speaking in an interactive session with a group of editors in Abuja, Dr. Kachikwu said the reforms were results of the 7 Big Wins of the Nigerian National Petroleum Corporation (NNPC) under the supervision of the minister and President Muhammadu Buhari.

Highlighting these reforms, the former minister said, the 2016 investor road shows to China, Japan, USA, Italy, France and India resulted in the signing of over $100 billion MOUs on diverse and much needed infrastructure developments across the oil and gas value chain.

In China, $80bn was attracted while another $15bn was attracted from India, Kachikwu said.

In 2017, the former minister initiated visits to the headquarters of International Oil Companies (IOCs) like ENI/Agip, Shell, Exxon-Mobil and Chevron which resulted in increased investment commitment in the sector as the IOCs committed to total upstream investments worth about $30bn.

On the part of the Nigeria petroleum Development Company (NPDC), Kachikwu said, "We increased NPDC production from a constrained 80,000 barrels of crude oil per day (bopd) to 250,000 bopd. NPDC currently supplies an average of 720MMscfd representing 47 per cent of total gas supply to the domestic market."

Listing other achievements within the last four years of President Buhari in the petroleum sector, he said the federal government attracted N1 trillion after the liberalization of the fuel subsidy in 2016.

Between January and December, 2016, he said Nigeria spent over N3.35 trillion on fuel importation as there was no provision for subsidy in the 2016 Appropriation and at the PMS Price of N86.50, a subsidy claim of N13.7 per litre which translates to $16.4 billion monthly was estimated.

Under the 'BIG WIN 2' which is about 'Business Environment and Investment Drive', and with the approval of all major stakeholders the price of petroleum products was increased from 87/litre to 145/litre with PMS price in Nigeria still remaining cheaper than its closest neighbours Niger, Benin, Cameroon, and Chad, he noted.

Highlighting the result of this intervention, he said, "This created a liberalized environment for private marketers and any other Nigerian entity willing to supply PMS to source for their foreign exchange and import PMS to ensure availability of products in all locations of the country. The price increase added N1 trillion to the revenue base of the country."

Going forward, Kachikwu said NNPC and the ministry will work to increase crude oil production to three million barrels per day in the next four years. Government will also finalise processes for new oil fields to increase local production.

There will be aggressive frontier exploration activities in the Chad and Benue Trough and Gongola Basin to increase crude and gas production and grow reserves across the rest of Nigeria.

The 7 Big Wins as a continuation, targets making Nigeria the investment hub for petroleum operations in Africa.

The programme will refocus crude oil marketing to develop specialized regional long-term markets and reduce exposure to international risk.

It will strive to implement Deep Offshore Act Amendment to enhance revenue from the deep offshore. At least, additional income of $650 million per year at $60/bbl is being targeted.

Nigeria through the programme will also look forward to concluding new projects like Bonga and Zabazaba oil fields to add about 300kbd to the country's crude oil production, he explained.

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