Vice-President Yemi Osinbajo said in Lagos on Tuesday that the fiscal provisions for gas business in the Petroleum Industry Bill (PIB) would be one of the most attractive in Africa.
Osinbajo made the declaration at the opening of the 38th Annual International Conference of the National Association of Petroleum Explorationists (NAPE).
The conference has “Accelerating Growth in Nigeria’s Hydrocarbon Reserves: Emerging Concepts, Challenges and Opportunities.’’ as its theme.
Osinbajo who was represented by Chief Timipre Sylva, the Minister of State for Petroleum Resources, said low prices and OPEC+ crude oil production curtailment had largely resulted to lower revenue generation for the Federal Government.
The vice-president maintained that government was committed to growing Nigeria’s oil and gas reserves, which currently stand at 36.89 billion barrels of crude oil and 203.16 trillion cubic feet of gas.
He said: “In order to grow our reserves, we have proposed fiscal incentives that will attract investments in all our basins in the PIB. In addition, the fiscal provisions for gas business will be one of the most attractive in Africa. Therefore, opportunities abound for geoscientists, engineers and numerous other service providers in the shortest time to come.
“In order to significantly grow our hydrocarbon reserves, we need to invest immensely in research and development so as to support the industry. We need effective synergy and collaboration between policy makers, academic institutions, professional bodies, oil and gas industry players and the research and development centres. They need to come up with innovative ideas and technology for cost-effective exploratory and drilling activities.’’
Osinbajo said the impact of the COVID-19 pandemic on crude oil prices had made it imperative to reduce the unit cost of production to $10 per barrel, adding that all hands must be on deck to achieve the target.
According to him, the government is also focussed on ensuring the growth of the country’s reserve base to at least 40 million barrels of crude oil, as well as the production capacity to three million barrels of oil per day.
“We are fully committed to this mandate and confident that we will achieve the desired goal of finding more hydrocarbon deposits in the Nigerian basins notwithstanding the curtailment in production. We have the assurance that production curtailment will soon be over as the world economy improves,’’ the vice-president added.
In his opening remarks, the President of NAPE, Mr Alex Tarka, noted that COVID-19 pandemic had an adverse impact on the oil and gas industry, stressing that the conference would provide opportunities for stakeholders to deliberate on the way forward.
Tarka said reduction in exploration and production activities had dire consequences for Nigeria due to the country’s dependence on crude oil as the mainstay of its economy.