Experts in the oil and gas sector say insecurity and crude oil theft were huge threats capable of derailing the actualisation of the objectives of the Petroleum Industry Act (PIA) to attract more investments to the sector.
The experts urged the Federal Government and security agencies to find a lasting solution to the issue in the interest of national development.
The experts spoke at the Pre-Conference Workshop of the Nigerian Association of Petroleum Explorationists (NAPE) on Monday in Lagos on the theme: ” The Next Decade of Oil and Gas Business in Nigeria: Impact of Energy Transition”.
Senior Partner, Delloite Nigeria, Olumide Esan, lauded the signing of the PIA by President Muhammadu Buhari, saying it was what the industry was yearning for to ensure growth.
Esan said the Act has defined the fiscal framework and incentives to drive investments in the oil and gas industry when fully operational.
He, however, maintained that the PIA on its own would not ordinarily translate to gains in the industry if issues such as insecurity and oil theft were not tackled.
Some oil companies, he said, lose between 20 to 50 percent of crude oil produced to oil thieves on a monthly basis, a development, he noted, was discouraging investors.
“Government is the only one that can get this issue under control, because clearly it will affect what we can get out of PIA,” he said.
Also, the General Manager, Assets and Corporate Strategy, Newcross Petroleum Ltd., Bashir Idowu, said his company averagely loses between 60 to 70 percent of its crude oil to oil thieves monthly.
“There is need for government to focus on tackling crude oil theft because it is a big challenge to the industry,” he said.
Idowu said indigenous companies were ready to play more roles in the sector following the divestment of assets by the International Oil Companies (IOCs).
He said divestment by these multinational companies was not peculiar to Nigeria as they were doing same in other countries due to diversification of portfolio and global energy transition.
Idowu said indigenous companies have the capacity to maximize the opportunities provided by the divestment to up their stakes from about 25 percent oil production to about 70 percent in the near future.
He, however, called for synergy among Nigerian companies in the oil and gas space to reduce their operating costs. (NAN)