The Federal Government of Nigeria has been advised to suspend royalty for the next five years to make the Country the preferred business destination for Oil and Gas investment. There must be incentive to accelerate production. The Country should also make Nigeria attractive and competitive for investments in Oil and Gas industry.
Omowumi Iledare, a Professor of Petroleum Economics, who is also Professor Emeritus, LSU Energy Studies, Baton Rouge, Louisiana, USA; so also the Executive Director, Emmanuel Egbogah Foundation Abuja, Nigeria and Director, Africa Region and Society of Petroleum Engineers International, Dallas, stated this at the AOGs Energy Resources Limited, webinar held last week with the theme: Energy Transition and Implication on the Nigerian Economy: A Critical Assessment.
He revealed that Seplat has paid for more than the pioneering status (Incentive) it received when it was starting operation.
While speaking on Energy Transition Dynamics: Strategic thinking for Crude Oil Reserves in Nigeria, he said Nigeria has the proof reserves of 37 million barrels a day even if we don’t find oil again.
Iledare maintained that the passage of Petroleum Industry Bill 2020 was crucial as it has answers to all the contending issues in the Oil and Gas industry in Nigeria.
He called on the Professionals to tell the politicians to do the right thing.
“PIB is the future, Energy transition is a game changer. This is not the time for Nigeria to think about Foreign Exchange for her resources but the time to make Nigeria Attractive to investments, make Nigeria competitive and preferred for investment in Oil and Gas industry. We need to reduce government take today so that the Oil in the ground will not become water. This may be the time to suspend royalty for Offshore, Onshore and Deep Water for five years”, he warned.
“Government must take taxes from profit. It will make Nigeria better. Seplat Petroleum has over paid to the government the pioneering status it received”, he added.
The professor of Energy Economics stated that Nigeria has potentials for 37 million barrels per day. But the country is currently producing about 2.5 million barrels per day. “If we continue to produce 2.5 million barrels per day, 50 per cent of the Oil will remain in the ground”, he warned.
“The government should try its best to see that Nigeria grows the production to 37 million barrels per day. If not, it may turn to water if not produced. I want to be the Jeremiah crying in the Wilderness. I warned Nigeria in 2013 at Oloibiri Lecture about what Shale Oil would do to Nigeria’s Crude Oil export, they didn’t listen. I advised the immediate past Minister of Petroleum Resources not to fix price for Premium Motor Spirit, PMS, he didn’t listen because it was not a political statement”, Stressed ED, Emmanuel Egbogah Foundation.
Iledare advised that we must not leave any resources behind, we must use our best to develop the country. “We must let PIB become a law by April or latest May 2021. We missed the opportunity in 2018, we must pass it now. Establish good governance and competiveness. Establish Local Content. Let us not leave any part of the country in moving Nigeria forward”, he stressed.
He also stated that we have to rethink the importance of Academia to the transition.
“You can’t adjust from fossil fuel to renewable energy like the West. Nigeria should be to Africa what China is to the Asian”, he stated.