Energy
From The Report: Nigeria 2016
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As Africa’s largest oil producer, Nigeria’s energy sector accounts for 90% of exports and at least 50% of government revenues. The country is second only to Libya on the continent in the size of its reserves, and onshore fields have been productive for decades. Offshore deposits are a frontier that has been massively underexplored, and in recent years international oil companies have started to refocus their efforts there. That has left an opening on land, which local start-ups have filled. New and smaller indigenous companies are buying up onshore blocks from the global giants, investing in fresh capacity, and increasingly shaping the sector and its future. Under the current government, a number of substantial moves have been planned – all of which, if executed, could significantly modernise the hydrocarbons industry for one of the world’s largest producers.

This chapter contains interviews with Emmanuel Ibe Kachikwu, Minister of State, Petroleum Resources and former Chairman of the Board, Nigerian National Petroleum Corporation; and Mohammed Sanusi Barkindo, Secretary-General, Organisation of the Petroleum Exporting Countries.

Articles from this Chapter

Overview

Future prospects: Abundant energy resources have made the sector a key driver of national economic growth
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As Africa’s largest oil producer, Nigeria’s energy sector accounts for 90% of exports and at least 50% of government revenues. The country is second only to Libya on the continent in the size of its reserves, and onshore fields have been productive for decades. Offshore deposits are a frontier that has been massively underexplored, and in recent years international oil companies (IOCs) have started to refocus their efforts there. That has left an opening on land, which local start-ups have filled.…

Interview

Local participation: OBG talks to Emmanuel Ibe Kachikwu, Minister of State, Petroleum Resources and Chairman of the Board, Nigerian National Petroleum Corporation (NNPC)
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Interview: Emmanuel Ibe Kachikwu What has been the impact of the global drop in oil prices on upstream investment? EMMANUEL IBE KACHIKWU: Globally, the drop in crude oil prices has resulted in a tremendous reduction in upstream investment, and Nigeria’s upstream sector is not immune to this. Nevertheless, the present administration’s anti-corruption campaign and improved security is restoring confidence in the Nigerian economy, thereby creating a new wave of interest in the upstream sector…

Interview

Guiding forces: OBG talks to Mohammed Sanusi Barkindo, Secretary-General, Organisation of the Petroleum Exporting Countries (OPEC)
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Interview:Mohammed Sanusi Barkindo How important is reform to the future development of Nigeria’s oil industry? MOHAMMED SANUSI BARKINDO: Restructuring Nigeria’s oil industry, a central plank of President Muhammadu Buhari’s reforms for the country, is vital to the development and expansion of its oil sector. The country has great potential, with over 37bn barrels of proven crude oil reserves, but to ensure this potential is met a steady hand is required to guide the industry through…

Analysis

Essential upgrades: Key improvements to the national pipeline network are rolling out, although security concerns remain
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With most gas found offshore in the eastern section of the country’s territorial waters, the need for pipelines to move gas elsewhere is paramount, given the large population centres in both the west and the north. Long-awaited upgrades to Nigeria’s pipeline network are expected in the next several years, aimed at addressing this key bottleneck. This will come through public-sector projects as well as privately financed ones. This marks a notable transition in the country – whereas building…

Analysis

Reforming the mix: A range of institutional developments and proposed legal changes are restructuring the sector
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Taking office in March 2015, Muhammadu Buhari, president of Nigeria, has made improving governance a top objective for his administration, with the energy sector one of his first priorities. Central to this is an overhaul, already in the works, for the Nigerian National Petroleum Corporation (NNPC) – the state-owned enterprise that both regulates and operates in the energy sector – as well as a long-awaited updating of the legal environment. The president has spearheaded a number of the initiatives,…

Analysis

Keeping it local: Domestic firms are playing an ever greater role in the sector
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There is a quiet revolution under way in Nigeria’s energy sector. As part of a broader push to boost local participation in the energy industry, a range of indigenous companies, such as Shoreline Energy, Frontier Oil and Transcorp, have emerged over the past decade, increasingly gaining access to a modest share of the upstream segment and expanding and diversifying in the downstream segment. The benefits of this transformation are plentiful, ranging from higher rates of domestic profits and private…

Analysis

A refined approach: Government and private sector players are investing in new facilities and projects
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Crude oil refining emerged early on as an area of focus for the government of Muhammadu Buhari, who within weeks of assuming office as president had begun rolled out plans to overhaul the existing facilities. The government has also initiated a fresh attempt to build new plants, with a focus on attracting private investment, such as the Dangote Group’s 650,000 barrels per day (bpd) complex in the Lekki Free Trade Zone of Lagos State. Long History Refining had traditionally been under the…