At OPEC High-Level Roundtable, Kyari Says Fuel Subsidy Removal, Forex Market Unification Will Bring Back Investments Into Nigeria’s Oil & Gas Sector

…Pushes For More Access To Clean Energy In Africa

The Group Chief Executive Officer of the Nigerian National Petroleum Company Ltd, Mallam Mele Kyari has said that the removal of fuel subsidy and the unification of the various segments of the foreign exchange market by the administration of President Bola Tinubu will bring back investments into Nigeria’s oil and gas sector.

Kyari said this on Thursday when he participated at the high-level roundtable on eradicating poverty organized by the Organization of Petroleum Exporting Countries.

The roundtable was held in Vienna, Austria at the sidelines of the 8th OPEC International Seminar.

Discussions centered around what needs to be done to bring about economic development by bridging the gap between poverty and prosperity, especially in the developing countries of Africa

Nigeria spends around N400bn monthly and about N4.8trn yearly on fuel subsidy

President Bola Tinubu had during his inauguration on May 29 announced that the Federal Government will no longer pay subsidy on Premium Motor Spirit.

Kyari described the removal as a right step in a right direction as it would unlock fresh investments into the oil and gas sector.

He said, “In our country, the government has taken the right step by taking out subsidies from the petroleum industry. And also having normalized foreign exchange. What that does is bring back investment in the energy sector and other sectors in our country, we have more resources, and of course, as you know, twenty years from now Nigeria will be the third largest population in the world with a closing of over 300 million people.

“That means that the country is the fastest-growing economy in its sub-region, and with all the potential and skills available, so, we know that as an energy company, we are an enabler industry for the purpose of growth in our country.

“This means that we must always look at our capacity and ensure that there is a current requirement for petroleum resources of all sorts in the short term and probably in the medium-term to create stability in our country. And this is already happening so we can be able to service the West African region.”

He also advocated for more access to cleaner energy for the people of Africa in view of the energy poverty ravaging the continent.

Kyari said further that the National Oil Company will leverage the quality of its resources, geographic advantage, and years of industry experience to move domestically from energy deficiency to sufficiency and support the global push for sustainable energy.

There had been a general perception that National Oil Companies around the globe, which represent around 50 per cent of the World’s Oil & Gas production, are absent in the effort to decarbonise the global energy mix.

Kyari said the NNPC is leading the push for sustainable energy delivery in the domestic and international markets while simultaneously delivering on the promise of eradicating energy poverty and subsequently achieving the 2060 net-zero target.

He painted the current picture of NNPC Limited’s reality in supplying the domestic market, producing and exporting hydrocarbons, and the vision for the future.

He noted that NNPC Limited is taking a cursory look at its portfolio and deliberately shifting its focus to gas.

He said, “We are the largest energy company in Africa, with a global ambition, and of course, we are also part of the ongoing effort but apart from global decarbonization, we alliance in such a way that we recognize the impact of our business on climate and climate change and also focus on this platform to objectively see how the problems affecting climate change can be addressed.

“Our major conversation around energy conservation is to avoid climate disasters. And we also know that our business contributes to issues around climate. When you have energy poverty, there is a slight calculation difference between energy poverty and poverty.

“In most developing countries today, there is extreme access to clean energy. In Nigeria, 70 per cent of the population does not have access to clean energy.So, it has to be arrested with no doubt about it. But where do we start? First, we must get people access to clean energy as quickly as possible

He stated further that the NNPC Limited will leverage gas as a transition and destination fuel by deploying gas for electrification, for chemicals, and for domestic industries and exports.

Kyari added that the NNPC Limited believes in delivering clean, affordable, and reliable energy as its strategy to eradicate energy poverty domestically and capture higher market share globally as it witness shifts in supply partnerships.

He explained that as a commercial enterprise, NNPC Ltd sees the Nigeria-Morocco gas pipeline project as an opportunity to monetize Nigeria’s abundant hydrocarbon resources, by expanding access to energy to support economic growth, industrialization, and job creation across the African continent and beyond.

He added, “We are looking at two perspectives, first as a business, and secondly, we have a very huge national ambition to electrify our company. Through building infrastructure for transmission and also getting power plants that are gas based across the country so we can scale up and assist with access to electricity.

“Currently, NNPC is bonding with a huge proportion of all the energy partners in the country. We are building new powers in Abuja, Kano, and Lagos State. So, ultimately, we can have access to power and this can’t be achieved except there are infrastructures that can deliver it.

“We are running trunk capacity, a huge trunk life capacity across the country and potentially extending this capacity into Europe and through a number of countries.

“There are two processes we are taking to achieve this; one is to extend our current line that is cutting across most locations in our country through Niger, pass through Algeria into Europe; also we are in another project in partnership with other national oil companies through a pipeline that will run from Nigeria all the way to 11 West African countries into Morocco and finally Europe.

“This involves infrastructure coordination, and alignment so that other African countries can have access to the huge gas that is available in our country.”