The Federal Government has unveiled a number of plans for the petroleum industry under the current fiscal year, which include conducting a new licensing round for the award of oil blocks and allocation of marginal fields in order to raise revenue for the country.
Besides, it promised that the long-awaited Petroleum Industry Bill (PIB), which has been renamed; Petroleum Industry Governance Bill will be passed this year, while also reducing petrol consumption in Nigeria from an estimated 50 million to 28 million litres daily, thereby saving about N3.2 billion daily from unaccounted volumes.
Given the reluctance by the international finance community to grant Nigeria the much-sought after loans amid dwindling oil proceeds, to enable the government execute its socio-economic programmes, the current administration need to rely on other ways and means to raise fund domestically.
Licensing rounds are a veritable avenue to raise quick funds for the government, which award a large expanse of land/oil block to exploration and production companies while also expanding the country’s production capacities, which is also.
The last administration had tried to execute a licensing round, but could not pull it off due to lack of confidence in the process, as it was feared that the oil block usually awarded to oil drilling and exploration companies would end up in the hands of political cronies, who will go hawking the licences.
If the plan works, the country will be on the way to meeting new production targets of 4 million barrels daily and 40 billion oil reserves, which it had consistently missed since 2010.
The PIB on its part is expected to form the nucleus of Nigeria’s aspiration to becoming one of the most industrialised nations in the world by the Year 2020, by boosting investment opportunities in the oil and gas industry, which had hitherto been stalled due to the non-passage of the Bill.
The Minister of States for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu, who disclosed of the plans in a podcast posted on his Facebook page titled: “Nigeria Petroleum Sector 2017 Outlook,” said the oil and gas sector is expected to run in ‘rocket pace’ this year.
He added that the areas of fiscal policy in the Petroleum Governance Bill is being finalised and would be looked at by the Executives and pushed out as the PIB.
He stated: “We have so much to do. We should be able to gazette our oil and gas policies and pass the PIB. We are going to accelerate Federal Government revenues by looking at more areas where the government can make more money.
“There is going to be improvement in royalty collection, improvement in early renewal of leases and every other area where we feel there is a gap.”
Kachikwu said government also hoped to finalise all the Memorandum of Understanding (MoUs) it entered into with China and India on crude oil export this year, adding that it is planning some road shows in the United Kingdom, Europe and the United States, to attract more investors into the oil industry.
He noted that the industry is expected to witness more activities in the year, while also reaffirming government’s commitment to providing long-term sustainable policies that would move the industry forward.
He said: “We have embarked on market liberalisation in the downstream sector. For the first time in over two decades, petrol is available all over the country and selling at the same price in all the states. We did not have the people in the Eastern parts of the country buying at a higher price while the people in the West buy at lower rate. It has been available all over the country at the same price per litre.
“We noticed that the consumption of Premium Motor Spirit (PMS) has shifted from over 50 million litres a day to about 28 million per day. This means we have been able to take away unaccounted fraud impacted volume of petrol, which is nearly 40 per cent of the country’s consumption.”
On the industry stability, he said Government will continue to look out for policies that would include a well-managed security apparatus that would bring lasting peace in the Niger Delta, adding that the engagement between the Federal Government and the Niger Delta militants has reduced the level of unrest in the region.
This, he said, led to an increase in the country’s crude oil production from 1.3 million barrels per day recorded during the unrest to 1.9 million barrels daily.