The Federal Government has expressed disappointment over investors’ preference to invest in huge gas projects in other African countries and showing apathy for Nigeria’s Liquefied Natural Gas projects.
The Minister of State Petroleum, Timipre Sylva, specifically took a swipe at ‘Total SE’ that invested $15bn in the funding of Mozambique’s LNG project, while it is dragging its foot to invest in Nigeria’s gas expansion programme, according to the petroleum minister.
The Minister expressed the displeasure of the government on Monday during the Pre-Summit Virtual Conference of the Nigerian International Petroleum Summit to officially launch ‘The Decade of Gas Mandate’.
Nigeria hopes to harness its unutilised gas deposits which is currently about 203.16 trillion cubic feet, according to the Department of Petroleum Resources.
The Petroleum Industry Bill which is expected to be passed later in April has been drafted to accelerate the country’s transition into a gas focused oil sector amid race for renewable energy.
Sylva said, “We worry about this on the government side. Yes we bend over backwards. But is that going to attract investments into Nigeria. Despite of the fact that we bend over backwards, are the investors ready to invest? Because a situation where for example a company I don’t want to mention the name will decide to invest $15bn in a challenged environment, in an LNG project in Mozambique, just as challenged as Nigeria, more or less and will be stalling on an investment in Nigeria where it is not actually spending any money, because most of it is from debt. Those are the concerns we have too.”
He said the government expects to see commitments from investors that when authorities adjust to accommodate investors concerns, the companies would also be “bending over backwards.”
Sylva said, “I’m encouraging us to invest and that is really the meeting points that we need and that meeting point will give us a PIB that is going to ensure the growth of this sector in Nigeria.”
The minister pointed out that the growth of the gas sector is inevitable in Nigeria because of the race for renewable energy.
To woo investors, Sylva said the government was already working on an appropriate pricing of gas.
He said, “Gas pricing is one of the things that we know also that will enable this sector and we are actually doing everything to ensure appropriate pricing of gas so that it will enable the growth of this sector.
“I will also tell you NNPC will be charged to conclude project development with Production Sharing Contracts Contractors within two months so as to unlock PSC gas to the domestic market.”
Sylva further maintained government’s stands on transition to renewables, saying natural gas would be Nigeria’s focus as transition fuel.
He said, “Also, in spite of global shift to renewables, Nigeria will continue to rely on natural gas as transition fuel for grid power generation while pursuing renewables for peak shaving and off grid power.
“We will conclude with you the gas master plan to accommodate current realities and we shall continue to support decarbonisation efforts and energy substitution.”