The Federal Government has been urged by Stakeholders in the oil and gas industry to be transparent and consistent in the application of rules with regards to lease renewal in order to avoid escalation of the nation’s political risk factor amongst existing and prospective investors.
In a communique issued at the end of the conference, participants added that government, operators and service providers should be willing adopters of digitization by considering new business models, cultivating a clear corporate digital strategy promoting a culture of innovation and change, and engaging and collaborating with others in the industry.
They also identified the need to conduct another bid round for marginal fields; in order to sustain the existence of successful marginal field operations, adding that most of the marginal field operators run single assets that are now depleted.
“To support an advanced digital energy industry in Nigeria, establishing governance on certification of data quality, incentivizing investments in digital technologies and update of legislation and policies to promote collaboration in the industry are critical enablers”, the communiqué, signed by SPE Nigeria Council Chairman, Debo Fagbami, read in part.
On lease acquisition in Nigeria, participants noted that such acquisition has evolved from discretionary to formal competitive processes, as they now attract significant value by way of bonuses, work commitments and contracts. Sizes of blocks are getting standardised, and bid rounds are better structured. Licence periods and terms can be better managed for value.
“We observed that the six licensing rounds carried out over a period of twenty-nine years yielded over $3billion despite the refund of signature bonus made to some companies while several millions are being earned from renewal of blocks, especially in the conventional terrain.
Source: The Nigerian Guardian