Yemisi Izuora
Minister of State for Petroleum Resources, Dr. Ibe Kachikwu has said that the global oil and gas sector lost about $300 billion in the last three years with Nigeria and other African countries bearing major hindrance in investment due to security and infrastructure challenges.
Kachikwu said the situation led to mass job loss apart from huge revenue loss.
The minister who spoke at the 2017 Society of Petroleum Engineers Nigeria Annual International Conference & Exhibition (NAICE) in Lagos with the theme”Riding the Waves of Boom and Burst: Common Objectives Diverse Perspectives”, said investors preferred to invest the limited resources elsewhere in Africa countries, so what we are losing other countries in Africa are gaining.
“The situation was very challenging when it comes to losing opportunity arising from investment, For the first time in the oil sector, the decline in the oil price resulted into loss of jobs.
He added that infrastructural gap in Nigeria, which has risen to $50 Billion which he blamed on monopoly as government did not engage private sector.
He said the private sector is key in fixing the infrastructural deficit affecting the industry
“The whole idea of new petroleum policy is to move the private sector into financing part of the project because Government cannot do it alone,” he said.
The Minister said the boom and burst had become the way of life in oil and gas sector, adding, “I think we have had about five circles of burst and boom over the last 35 years and each time we begin as if we did not expect it. “The boom and burst has become the nature of oil and we should not be surprised anymore.
“Over 80 per cent decline in world oil price was recorded between 2014 and 2016 with oil price falling between 25 dollars per barrel. “All the same, we have managed through the principles of OPEC to keep the price going between 45 and 50 dollars per barrel.
“For now, our expectations between the year 2017 and 2018 is to keep the price to 60 dollars per barrel,” he said.
He however, said countries and people were moving away from oil, adding that electric motors were taking over globally.
“In the next 20 to 25 years, oil lifespan will expire, so we just need only five years to make a change of policy in the sector.
“We must make a traumatic decision on oil sector to survive the innovation.
“The country needs a consistent policy and deal with inefficiency in our system to survive the trend,” he said.
Speaking earlier, Mr Saka Matemilola, the SPE Nigeria Council, said the mission of the conference was to disseminate information as regard to oil and gas sector.
Matemilola said petroleum sector remain the main focus in the country economy.
He said the current challenges in the oil sector provided the necessary catalyst to provide opportunities for the country.