The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, on Thursday said some Deposit Money Banks in Nigeria lacked sufficient knowledge of the oil and gas sector.
According to him, this is why the banks are unable to provide long-term financing needed to build capacity in the oil and gas industry, adding that the high lending rates by the DMBs had made it difficult for companies in Nigeria to compete with their peers globally.
Kachikwu also insisted that international oil companies operating in Nigeria must strive to reduce the production cost of a barrel of crude oil from an average of $32 per barrel to $15.
He further announced that the Federal Government had entered into discussions with Original Equipment Manufacturers as touching plans to begin 100 per cent local fabrication of modular refineries in Nigeria.
Kachikwu said the government would also set a deadline for the local fabrication of oil vessels and floating, production, storage and offloading vessels.
The minister spoke in Abuja at the signing of the Memorandum of Understanding between the Nigerian Content Development and Monitoring Board and the Bank of Industry on the implementation of the $200m Nigerian Content Intervention Fund.
He said, “Over the years, Nigerian companies have found it difficult competing with their counterparts from jurisdictions where funding is accessible for five per cent or less as compared to our market where bank lending rates hover around 20 per cent.”