The Independent Petroleum Producers Group (IPPG) has praised the federal government for facilitating the divestment of International Oil Companies (IOCs) from Nigeria. This shift has increased the role of indigenous firms, which now contribute about 50% of the nation’s total oil production.
Indigenous Firms Take the Lead
Speaking at the 8th Nigeria International Energy Summit in Abuja, IPPG Chairman Abdulrazaq Isa highlighted the significance of the IOC divestments. He stated that Nigerian oil firms have proven their ability to operate efficiently, ensuring that the transferred assets remain productive.
“With the completion of these divestments, our members now bear a national responsibility. We are committed to driving industrialization by investing across the energy value chain. These investments will impact various sectors, including petrochemicals, agriculture, power, manufacturing, construction, and transportation,” Isa said.
He added that indigenous exploration and production firms now account for half of Nigeria’s oil and gas output, a share that will likely grow. “This marks a transformative period for our members. We aim to be a key driver in achieving a trillion-dollar economy within the next decade,” he stated.
Commitment to Domestic Crude Supply
Isa reaffirmed IPPG’s support for the domestic crude oil supply mandate introduced by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC). “We are working closely with the government to ensure the success of this initiative, which aligns with our collective goals of energy security and value creation,” he said.
He emphasized that Nigeria must take control of its energy future, particularly as the global energy landscape shifts. African nations, led by Nigeria, should address persistent energy challenges on their own terms.
Policies Driving Industry Growth
Isa commended the policies introduced by the Tinubu administration, noting that they have steadily revitalized the oil and gas sector. He pointed out that the Decade of Gas Initiative has unlocked crucial projects, including liquefied natural gas (LNG) production, gas-to-power developments, and the Presidential Compressed Natural Gas (CNG) Initiative.
“Our crude oil production has grown steadily, allowing Nigeria to meet its OPEC quota of 1.5 million barrels per day. Additionally, security improvements in the Niger Delta have created a more stable environment for operations,” he noted.
Isa also highlighted recent Final Investment Decisions (FIDs) worth $5.5 billion on key projects such as NNPCL and TotalEnergies’ Ubeta field development, as well as Shell’s Bonga North project. These developments were influenced by the Presidential Executive Orders issued in March 2024.
“The initiative has also facilitated the settlement of longstanding gas debts, restoring investor confidence. Additionally, NUPRC’s annual bid rounds demonstrate the government’s commitment to sustainable production and reserve growth,” he added.
OPEC’s Support for Africa’s Oil Potential
Haitham Al-Ghais, Secretary-General of the Organization of the Petroleum Exporting Countries (OPEC), reaffirmed the group’s dedication to maximizing Africa’s oil potential. Speaking at the summit, he underscored OPEC’s continued collaboration with Nigeria and other African members.
“Unlocking Africa’s vast resources is a top priority for OPEC. We will work closely with the Nigerian government and our African partners to achieve this goal,” Al-Ghais said.
He noted that half of OPEC’s member countries are from Africa, including Nigeria, Algeria, Congo, Gabon, Equatorial Guinea, and Libya. With approximately 120 billion barrels in proven oil reserves, the continent holds significant untapped potential.
Al-Ghais cautioned against sidelining Africa’s resources due to the global energy transition. He emphasized the continent’s growing youthful workforce as a valuable asset for the oil sector.
“It is crucial to create an investment-friendly environment that attracts the capital needed to harness Africa’s energy potential fully,” he said. He also stressed the importance of long-term stability in the oil market, noting that the industry requires an estimated $17.4 trillion in investments by 2050.
“Market stability is essential for investors to plan effectively and ensure sustainable growth in the energy sector,” Al-Ghais concluded.
