Nigeria’s oil and gas sector is expected to attract $48.4 billion (about N17.29 trillion) out of the industry’s $194 billion (about N69.84 trillion) capital investment flow into Africa by 2025.
Dr. Maikanti Baru, the outgoing Group Managing Director of the state-owned Nigerian National Petroleum Corporation (NNPC), made this disclosure while addressing the 2019 Nigerian Oil and Gas Conference and Exhibition (NOG) in Abuja.
According to Maikanti Baru, Nigeria is a leading player in Africa’s oil and gas industry. Little wonder the country is expecting to attract such huge amount as the rest of the continent share the remaining balance.
He said, “The nation’s energy outlook appears very positive despite the difficult operating and economic headwinds across the continent.
It is also significant to state that out of about $194 billion surge in capital expenditure coming into oil and gas development on the African continent from 2018 to 2025, Nigeria currently accounts for 48.04 billion dollars (over 24.8%) with other African countries sharing the balance.
For Nigeria, therefore, oil and gas remain essential building blocks for our economic growth, particularly as a developing country.”
Factors that will attract the investments: Having noted that Nigeria remains a major oil and gas investments destination in Africa (attracting over 24.8 percent of total foreign direct investments coming into the continent), Baru emphasised that the country’s oil industry is replete with massive investment opportunities.
“Nigeria holds about 2.2 per cent of global oil reserves. Our crude oil reserves have grown steadily from about 22 billion barrels in 1999 to 37.5billion barrels in 2018. Nigeria is home to the second largest crude oil reserves in Africa after Libya. Our crude oil production currently hovers around 2.2 -2.3 million barrels of oil per day (bopd). This was bolstered by the coming on stream of the Egina Field in December 2018 and which has currently ramped up to 200,000bopd.”
Talking about gas, Baru noted that Nigeria has the 9th largest gas reserves in the world with estimated and probable gas reserves of 201 trillion cubic feet (Tcf) and an upside potential of about of 600Tcf.
“In terms of gas production and utilization, Nigeria averages about 8.4bscfd. While only 18% of the production is consumed in the domestic market (Power, Industries and WAGP), 43% is exported as LNG, 32% is re-injected for enhanced oil recovery and other operational uses like fuel gas while 7% of total gas production is currently being flared.”
Note that more investments into the Nigerian oil and gas sector will potentially increase yields/returns on investments which, altogether, is a good thing for the Nigerian economy.