Foreign Exchange Barrier Nigeria’s Biggest Challenge In Attracting Gas Sector Investment —Seplat Boss

Nigeria can harness huge investments in the gas value chain through the development of business models that give providers of capital the much needed confidence, the Managing Director of Seplat Energy Plc, Mr Roger Brown has said.

He said this while appearing in one of the panel session which was held at the 2022 Nigerian Oil and Gas Conference.

The conference is being attended by oil and gas stakeholders in the private and public sectors of the Nigerian economy.

Brown in his submission at the event hinted that the $700m ANOH Gas Processing Company being constructed by Seplat and the Nigerian National Petroluem Company Ltd at Asaa, Ohaji/Egbema, in Imo State was near completion.

He stated that when completed, it would provide gas to boost the much-needed supply of power to millions of homes and businesses across Nigeria to facilitate a better standard of living and drive economic growth.

Nigeria is pursuing energy transition in order to promote economic growth and is gradually investing in gas so as to reduce carbon emissions whilst continuing to exploit hydrocarbon resources. Currently, natural gas is the energy transition fuel for Nigeria.

Nigeria is currently having six quadrillion BTU of energy production annually making it the second highest in Africa.

The Seplat Energy Plc Boss said Nigeria has abundant resources of crude oil and gas, but added that this can only translate to value for the country if they are harnessed for the benefit of the people.

He listed one of the main challenge faced by industry players to include currency convertibility to enable the importation of equipment in dollars.

He said, “We have huge resources in gas and we can access that gas into power. We have between 10,000 to 15,000 megawatts of power whether through gas supply or transmission.

“So that’s an easy fix, we have a community or off-takers that are paying five to seven times of money they shouldn’t be paying and so there is a solution that is the connection of the supply chain. And this is not a complex solution, it’s about everybody working together to get that solution.”

He stated further that there are so many investors that want to invest in Nigeria, but added that some of these investors are being hindered by the challenges in the foreign exchange market.

He said, “Currency is one of the biggest headache. I can tell you that we talk every time around the world and people are really interested in Nigeria.

“They find it complex, you need to demystify it, there’s a wall of money ready to come into this country, but they look at barriers to it and one of the biggest barriers is the currency.

“So, currency convertibility you know, bringing equipment in dollars and then having a mainly Naira revenue stream.

“These things are fixable. We need to get those right there in any amount of big projects and really exciting projects. And what I like about the economics here in Nigeria is that they are unbelievably good.”

The Seplat MD also said that there is need for more synergy between the public and the private sectors in terms of addressing the most pressing issues hindering the gas sector.

He urged the government to quickly address the issue of crude oil theft as this was crippling the potentials of the Nigeria economy

Brown added, “It’s clear that on the oil side, the theft levels are just unsustainable. We have a crippling economy because of it and that has to be solved.

“On the gas side, it’s about fixing the value chain from gassing to electricity, from molecules to electrons in the country and getting it right.

“Also, we are not going to get renewable energy without scalable gas in the country and we have enough gas in Nigeria to deliver that.”