Uche Cecil Izuora
The Nigerian Association of Petroleum Explorationist (NAPE) has called for better incentives that will be attractive for investors especially in the country’s frontier basins.
President of NAPE, Mrs. Olajumoke Ajayi, while speaking at a panel session at the ongoing Nigeria International Energy Summit (NIES), the advocated for incentive that will attract investors to invest in Nigeria’s oil and gas industry.
Ajayi, said there are some things some other African countries like Ghana that can be replicated in Nigeria.
She said though in the area of oil and gas development, “we can say that Nigeria is ahead of most African countries, but it does not mean that the country cannot learn from those behind it.”
This has to do with the frontier basins. The NAPE President spoke on the fifty assets that have been presented for the ongoing bid rounds and fifteen of them are frontier basins. “The question is which incentive will be given to investors to attract them for the assets.”
The NAPE President stated clearly that the main objective of the association is continuous exploration. “As the existing reserves are being depleted, it has to be replaced with new discoveries.” This is why NAPE continues to advocate for exploration because as existing reserves are depleting, there should be new discoveries to replace them.
Previously, Ghana focus was not on signature bonus, the country had other workable program which is giving of assets; the company goes ahead to process seismic and evaluation while conversation begins. But if not satisfied with condition given, the asset can be dropped.
It means the interested bidder has not lost any signature bonus.
The only thing done is to access the asset while the government takes over the data. This means value has been added. On the contrary, if the interested party agrees to terms and conditions given, he can continue with it.
This is quite better than signature bonus and will add value to assets. If a major discovery is made the government will get more on daily basis aside from royalty and taxes. An incentive has been given to attract investor to the assets and all parties get advantage of it.
Ajayi, expressed the view that if conditions are attractive, it will lure more investors to the country’s oil and gas industry sector.