On January 20, 2020, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mele Kyari Virtually attended the Atlantic Council Global Energy Forum where he spoke on “Delivering Energy Access in the Developing World”.
Kyari began by discussing on the country’s increased Domestic Gas.
Excerpt are some key statement from the GMD at the Forum:
“Nigeria is currently witnessing increased domestic gas demand in the industrial and power sectors, leading to increased production and reduced gas flaring.”
“Nigeria has also witnessed increased household access to gas networks and LPG in the main cities. There are deliberate plans to expand that access to rural areas.”
“There are conscious efforts most recently by the Federal Govt aimed at deepening domestic gas consumption through the use of Compressed Natural Gas (CNG) and Liquefied Petroleum Gas.”
“We are not just a Petroleum country, we are a gas-rich nation. We are utilising the available resources of today to create the opportunities of tomorrow.”
Nigeria is the largest economy in Africa and has had a robust democratic government for over twenty years. Approximately 70 percent of West Africa’s gasoline supply now comes from Nigeria, demonstrating the country’s strong and growing energy sector.
Further, the government is working to reform Nigeria’s fiscal environment to attract more investment into the oil and gas industry.
Kyari expects new petroleum legislation that will facilitate competition and increase transparency for investors to pass by the end of the year.
Kyari continued by discussing other upcoming improvements in Nigeria’s oil and gas industry, focusing in particular on eliminating fuel subsidies.
Nigeria has struggled with domestic fuel subsidies for years, particularly in “subsidizing consumption” of oil and gas.
The government pays $2 to $3 billion annually in subsidies, leading to the underfunding of necessary public services.
Kyari said that a gradual transition to higher prices would be manageable, giving consumers ample time to adjust to the market shift. Additionally, he said that the redirection of funds into other valuable public benefits would bolster popular support for such a change.
Kyari highlighted the domestic changes that have made investors more comfortable engaging with opportunities in Nigeria.
The NNPC is operating on the principles of “transparency, accountability, and performance excellence.” Kyari is confident that these tenets, coupled with the growing economy and strong democratic government, are indicative of a promising economic future for Nigeria.
