The apex body of professional geoscientists, Nigerian Association of Petroleum Explorationists (NAPE), has foreclosed the realisation of the country’s 40 billion crude oil reserve target set by the Federal Government for 2020
NAPE President, Dr. Andrew Ejayeriese, painted the gloomy picture at a media briefing in Lagos yesterday to announce activities lined up for the association’s 36th Annual International Conference and Exhibition with the theme ‘‘Evolving Strategies for a sustainable Petroleum Business in a fluctuating Oil Price Regime’’.
Ejayeriese, while listing the several obstacles towards the realisation of the target, also observed that, there was no working template to suggest that the 40 billion barrels oil reserve target by 2020 could be achieved.
He noted that the target had become more of mere talk which was gradually turning to a cliché rather than an action plan; a development he said remained worrisome.
The NAPE President also expressed worries that exploration that ought to have boosted oil reserves are not happening because the country’s investment climate is not business friendly as oil firms are subjected to all manner of taxes and levies, leaving them with a lean bottom line.
‘‘Oil companies that have refused to go into exploration in Nigeria are doing same elsewhere because the investment climate is conducive in such regions. Businesses will rather take their funds to places where return on investment, security and infrastructure are guaranteed,’’ he disclosed.
He equally took a swipe at the National Assembly for not being able to pass the Petroleum Industry Bill(PIB), saying the proposed law that was meant to unlock potentials in the country’s oil and gas sector has suffered several setbacks, thus discouraging fresh investments into the sector.
‘‘All these obstacles pose a threat to the realization of the 40 billion barrels oil reserve target by 2020. If Ghana could get its oil reform laws sorted out in 18 months, why should ours drag for over 18 years without a headway,’’ he lamented.
On the theme, he said oil and gas would continue to be a commodity characterised by peaks and troughs, adding that the cyclicality of the industry is not a new phenomenon.
According to him, stability in oil prices is critical in order to achieve high economic growth, stating that, the global energy market is getting increasingly more complex; with the low oil price regime, hydrocarbon exploration and exploitation are no longer as profitable as it was prior to the price decline in 2015.
“While global demand for reliable and affordable energy will continue to rise in the foreseeable future, the world is moving toward a low carbon era.
Consequently, oil and gas companies will find it expedient to review long term strategies and innovate, recognising the possibility that oil is on the brink of suffering a fate similar to coal.
Although the global economy continues to recover, growth has been slower than anticipated. Oil price fluctuations are strong determinants of inflation rate and unemployment levels which, in turn, , impact the growth rate of a nation’s economy,’’.