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Minister of State for Petroleum Resources, Dr. Ibe Kachikwu Emmanuel urges council on hydrocarbons to address crisis in oil industry
- Ayade wants FG to extend search for oil to Cross River
The Minister of State, Petroleum Resources, Dr. Emmanuel Ibe Kachukwu, has said for a lasting peace to be achieved in the Niger Delta region, oil bearing communities must be involved in oil and gas exploitation in their areas.
The minister made the assertion at the closing of the 2nd National Council on Hydrocarbons summit held in Uyo, Akwa Ibom State, noting that from a peak production of 2.35 million barrels per day recorded last year there was a declined to 1.1 million barrels per day due to incessant vandalism.
However, Kachukwu observed that due to sustained engagements with the Niger Delta, production has ramped up to about 2.1 mbpd from 2016 crude oil production average of 1.85 mbpd.
Also, he said the Nigeria local content has witnessed a steady increase in participation of Nigerians in oil and gas contracts by more than 180 per cent.
The minister said the challenges in the sector include security and environment, institutional capacity, funding of investments, high industry technical costs, obsolete legislation and fiscal regimes, downstream sector issues and infrastructure constraints.
The minister said that the seven Big Win Roadmap as launched by President Muhammadu Buhari last year remained peculiar as it has the explicit support and commitment of political leadership, industry and all stakeholders to its implementation.
Issues in the sector he said would soon be addressed by a new National Oil and Gas Policy which would be legislated in the next few months.
The new oil policy, according to him, would create a market driven oil and gas industry, maximise production and processing of hydrocarbons, minimise the environmental impact of oil exploitation and exploration, extend gas penetration in the domestic market and gain a presence for Nigerian gas in the international market.
He added that the policy would also enable Nigeria to operate a gas industry with a clear division of roles between private and public sectors, end and commercialise gas flaring and environmental issues and clarify the rules guiding investment in the gas sector.
“The roadmap has very specific time-focused targets and like the many bold steps we have taken in this sector since the inception of the present administration, we remain focused to making dramatic policy shifts in this sector to grow, deepen and open up the business and opportunities in Nigeria’s oil and gas sector,” he stated.
Speaking at the summit, the Akwa Ibom State Governor, Mr. Udom Emmanuel, said the establishment of the National Council on Hydrocarbons would help to address the crisis and agitations experienced in the oil and gas sector.
“I strongly believe that if we had a platform of this nature before now, where key players and stakeholders often converge to develop policy thrust to drive the industry, the crisis and agitations we have experienced in the sector would have long been addressed,” he said.
The governor who was represented by his deputy, Mr. Moses Ekpo, urged the implementation of the resolutions reached at the first council meeting of the body in order to resolve some of the problems in the oil and gas territory.
He said it was wrong for some federal agencies as well as some oil companies to carry out some interventionist projects without consulting the state government or its agencies.
“This kind of action usually engenders mistrust, generates restiveness which is not helpful in ensuring smooth operations of the industry,” he stressed.
For example, he said out of 2,198 names of youths from the Niger Delta region trained in welding and fabrication under the Presidential Amnesty Programme, the 107 names allocated to Akwa Ibom State, 26 of those youths were not from the state.
He equally noted with concern that despite pressure from all angles for the multinational oil companies to relocate their headquarters to Akwa Ibom State, nothing has been done.
“I think that the federal government should compel compliance of oil companies with immediate effect. Some of the oil companies operating in the region still neglect some vital processes of ensuring peace such as the signing of Memorandum of Understanding (MoU) with their host communities.
The governor equally noted incessant oil spills that plagued the state which most of the oil companies have refused to clean or manage around the their facilities and host communities.
“It is also my conviction that a platforms of this nature offers us the opportunity for continuous assessment, projections as well as chart a way forward for the industry,” he added.
He said the theme of this year summit of the council: “The 7 Big Wins: Framework for Realising the potential of Hydrocarbons” was timely as it has the potential to chart a new course for the industry vis-à-vis the economy of the nation.
The 7 Big Wins is built on the philosophy of Transparency and Efficiency, Policy and Regulations, Business Environment, Investment Drive, Niger Delta and Security, stakeholder Management and International Coordination, Gas revolution and refinery and local production capacity.
The state government, he said has taken steps aimed at promoting exploration, production and processing of hydrocarbons in the areas of infrastructure development, local content, promotion of peace and establishing mid-stream industries and developing our manpower.
“It is important to note that although the global community is clamouring for the diversification and the alternative sources of energy, hydrocarbon will still remain the number one feed-stock to many industries.”
He advised that policy drive should shift from exporting crude oil to producing and exporting petrochemical products by investing more to develop the mid-stream sector of the petroleum industry.
Meanwhile, the Cross River State Government has expressed worried of being classified as a non-oil producing state in the Niger Delta region despite the fact the state is surrounded by a country like Republic of Cameroon and Akwa Ibom State acknowledged as oil producing areas.
The Cross River State Governor, Senator Ben Ayade said at the 2nd National Council on Hydrocarbons summit that the state strongly rejects being tagged as a non-oil producing state in the country.
Senator Ayade who was represented by his deputy, Prof. Ivara Esu said “for us in Cross River State we are very perplex that we are surrounded between Cameroon and the State of Akwa Ibom State that have fast reserve of oil and gas and yet today we are not an oil producing state.”
The state government, the governor said was ready to go into serious studies and if possible exploration to see what the state has as its oil reserve, stressing, “We refused to accept that kind of situation because the oil is flowing on the ground and we expect that there is a situation where there is a cut.”
Ayade frowned that in spite of several appeals to the federal government for actualization and permission for the state to undertake oil exploration in its territory, the request had not seen the light of the day.
“For long we have asked for actualization and permission for us to do this and we have not heard anything from the federal government.”
The governor called on Kachikwu to help the state to do their own finding to see how much of the oil and gas resources are under ground and not exploited Ayade also urged the federal government to allow the state access to the Frontier Funds set aside for oil and gas exploitation in the country in order to aid oil and gas exploration in the state.
“There are Frontier Funds for the exploitation of oil and gas and yet don’t we deserve to have those funds to do this exploration in our territory, we have abundant oil and gas in Cross River State.
“If the Frontier Funds are being utilized to explore oil and gas in the various sections of the country, I think our state also demands that this gesture be extended to us and our environment,” he stated.
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