The Nigerian National Petroleum Company (NNPC) Limited started activities for the week with its Group Managing Director (GMD), Malam Mele Kyari, advocating for more investments in the oil and gas sector to effectively tackle the current global energy crises.
Kyari who made the call while speaking at the 23rd edition of the World Petroleum Congress held in Houston, United States, spoke on the theme: “Building Partnerships”.
He described the choice of the topic as apt because partnership remained an essential component for creating synergy in the delivery of value to various stakeholders and guaranteeing of energy security.
“Our industry is faced with a multitude of challenges, one of which is the requirement for a careful balancing of the aspirations of energy transition and energy security.
“This balance directly impacts energy investments and capital attraction for the development of fossil fuels. The lack of investment capital for oil and gas is already creating energy crises around the world.
“Who would have ever thought that the price of natural gas could sell as high as $60 per MMBtu.
“It is important to pinpoint the fact that the energy and economic security of many resources rich countries is heavily dependent on the development of their hydrocarbon resources.
“This is an important source of generating revenue, providing employment and alleviating energy poverty in these countries while ensuring that the world never lacks the energy it requires to function effectively.”
Kyari told participants at the event that the challenges facing the sector was stifling supply sources, adding that this was what was creating shortage of global energy supply.
He said time had come for all players in the global oil and gas industry to collaborate in creating partnerships for the development of the technologies and funding required to achieve energy transition, energy security and value to shareholders.
The NNPC GMD further explained that the national oil companies as resource owners, needed investment to derive economic value from those resources while investors needed stable markets and regulations to make healthy returns.
He added, “Today, regulation is creating a capex gap, especially to those of NOCs where we see about 50 per cent reduction in investments.
“As technology, innovation, stiff competition for capital and market volatility continue to generate huge waves, the strength in our partnerships, as we transit, will remain our key survival strategy today and in the future.”
Speaking on the Petroleum Industry Act (PIA) 2021, he said through the legislation, Nigeria has renewed its commitment to attracting investments in the oil and gas industry.
“The Act provides the needed improvements in fiscal and governance frameworks, emphasizes transparency and accountability as well as provides a level playing field for all players.
“This is indeed a new dawn for investors as well as our National Oil Company, NNPC, that is transiting to a commercially oriented limited liability company,” he added.
Meanwhile, Secretary General of the Organisation of Petroleum Exporting Countries (OPEC), Dr Mohammed Barkindo, has said that any talks about oil and gas going into extinction in the coming decades are out of order.
Speaking at the 23rd World Petroleum Congress Plenary Session on “Energy Transition: Scenarios for the Future”, in the United States, Barkindo said that neither science nor statistics support that position.
He said that public discourse around energy, climate and sustainable development continues to be extremely emotive, adding that it was evident in Glasgow, with many voices from the petroleum industry excluded from speaking.
“At times, the narrative around the energy transition has been overtaken by emotional outbursts, with rational discussions based on facts, hard data and science, taking a back seat,” he said.
The secretary general stated that the complexity of the challenge calls for an inclusive approach; not the pursuit of a single ‘one size fits all’ panacea, insisting that to reduce emissions required a delicate balancing act, with all voices heard, and listened to.
He argued that focusing on only one of the issues, while ignoring the others, could lead to unintended consequences, such as market distortions, heightened price volatility and energy shortfalls.
Describing climate change and energy poverty as two sides of the same coin, Barkindo noted that the world needed to ensure energy was affordable for all and a more inclusive transition.
According to him, the world will need more energy in the future, with OPEC’s recently released World Oil Outlook (WOO) 2021 seeing global energy demand expanding by 28 per cent by 2045.
“For oil and gas, there are some who believe that these industries should not be part of the energy future, that they should be consigned to the ‘dustbin of history’, and that the future is one that can be dominated by renewables and electric vehicles.
“It is important to state clearly that the science does not tell us this, and the statistics related to the blight of energy poverty do not tell us this either,” he added.
While admitting that renewables were coming of age, with wind and solar expanding quickly, Barkindo said that even by 2045, it is only estimated to make up around 24 per cent of the global energy mix.
He reiterated that oil and gas combined were forecast to still supply over 50 per cent of the world’s energy needs by 2045, with oil at around 28 per cent and gas at just over 24 per cent.
In terms of electric vehicles, the OPEC helmsman stated there was no doubt that they would continue to see expansion in the transportation sector, but that the share of electric vehicles in the total road transportation fleet was projected to expand to only close to 20 per cent in 2045.
He argued that OPEC fully believed that the oil and gas industries can be part of the solution to tackling climate change, and evolving the energy transition.
He listed carbon capture utilisation and storage as well as blue hydrogen and the promotion of the circular carbon economy, to improve overall environmental performance as key to energy sustainability.
Still in the week under review, Vice President Yemi Osinbajo said Nigeria would require investments of up to 410 billion dollars to achieve net-zero by 2060.
He was quoted as saying this by his spokesperson, Laolu Akande who delivered on his behalf, the keynote address at the World Liquefied Petroleum Gas Association (WLPGA) Forum in Dubai, United Arab Emirates.
The week-long event, themed “Energising Tomorrow”, provided the Vice President the platform to further elaborate on critical role of the natural gas, especially Liquefied Petroleum Gas (LPG) would play in addressing the clean cooking challenge, as well providing grid stability to integrate renewables at scale.
In his address, Osinbajo said LPG and natural gas were sustainable energy fuels that could address both climate change and energy poverty simultaneously.
He said the Federal Government had developed an energy transition plan “which showed that achieving net-zero by 2060 would require investments of about 410 billion dollars, above business as usual.”
“The world should not have to choose between energy poverty and climate change as this could be addressed with both natural gas and Liquefied Petroleum Gas as transition fuels alongside other renewable sources.
On Energy transition, Osinbajo disclosed that Nigeria’s energy transition plan was tied to adopting and domesticating all forms of cleaner energy, adding that the use of LPG as a transition fuel was the viable option for the country to address climate change and energy poverty.
He argued that for a gas-rich country like Nigeria, the most viable option in terms of balancing energy security with environmental sustainability would be the use of LPG as a transition fuel.
To this end, he said Nigeria had developed an integrated energy plan with a clean cooking model, which showcased the clean cooking opportunities across technologies such as electric cooking and LPG.
He noted that for countries like Nigeria, which had ample natural resources but was still energy-poor, energy transition fuels must possess certain qualities including affordability, reliability, equity, and inclusiveness.
He emphasised that the implementation of various initiatives and legal frameworks on LPG elevates it as the fuel of choice compared to other competing fuels.
Osinbajo further explained that the government has “consummated collaboration with the European Union (EU) through a study on CO2 savings based on the National LPG Expansion Implementation Programme for clean cooking.”
He therefore urged that “The world should not have to choose between energy poverty and climate change as this can be addressed with both natural gas and LPG as transition fuels alongside other renewable sources.”
In another development, the NNPC has enlisted 17 assets of its upstream subsidiary, the Nigerian Petroleum Development Company (NPDC) for carbon emission reduction under the Leak Detection and Repair Programme (LDRP).
The development comes ahead of the Federal Government’s commitment to attainment of Net Zero by the year 2060.
The exercise which is being executed under the auspices of the European Union Emission Trading system through the European Fuel Quality Directive (FQD) has the potential of earning about €30million cumulatively at net zero cost.
Engr. Jubrin Lawal, Group General Manager, Renewable Energy Division of the NNPC said that the NNPC, through the Division had lined up a bouquet of innovative solutions to support Nigeria’s quest to reduce greenhouse gas emissions in its operations to meet global standards and achieve the net zero target by 2060.
He listed some of the 17 NPDC assets to include Oziengbe-South OML 111, OML40 Onshore, Kukaku/Yeye OML 64, and OML 66 Onshore among others.
Also in the week under review, the host communities of the Nigerian Gas Marketing Company (NGMC), northern operations, have commended the company for its sustainable development and empowerment programmes.
The commendation was given at the handing over of starter packs to beneficiaries of the women’s skills acquisition programme organised by the NGMC in Lokoja, Kogi state.
Speaking at the ceremony, Otunba Victor Atteh, from Obajana community, said the NGMC’s commitment to the development of its host communities was unprecedented and urged other corporate bodies to emulate the company.
He thanked NGMC for redeeming its pledge to the communities while urging the management to undertake regular monitoring of the progress of the beneficiaries to ensure the programme’s sustainability.
Speaking also, the Managing Director of NGMC, Justin Ezeala advised the beneficiaries to make judicious use of the materials while restating his company’s commitment to the continuous economic empowerment of its host communities.
Represented by the Deputy Manager, Services, Mr Idorenyin Ekpo, the MD expressed gratitude to the traditional leaders and people of the communities for the cordial relationship with NGMC and protection of NNPC’s facilities in their domain.
On his part, the Lead Consultant, Bernard Emekpe, noted that NGMC had given the beneficiaries a life changing opportunity which should be used to change and improve the economic well-being of their respective families.
He thanked NGMC for living up to its mission statement by responding positively to its host communities.
Some of the beneficiaries also bared their minds on the development.
Other community leaders present at the event were Baba Ismaila–Ofunene, Ajaokuta community and Abdulmalik Muktar, Geregu community leader. (NAN)