In quest for FDI inflows, NNPC woos global energy investors
In the wake of increasing demand for Foreign Direct Investments (FDIs) into the Nigerian oil and gas industry, the Nigerian National Petroleum Company (NNPC) Limited has called on the global energy community to partner with Nigeria and other African countries towards achieving energy security and economic prosperity in the continent.
The Executive Vice President, Upstream, NNPC, Mr. Adokiye Tombomieye, made the call while delivering his keynote address at the just-concluded annual conference and exhibition of the Society of Petroleum Engineers (SPE) in Lagos.
Represented by the Managing Director of NNPC Energy Services Limited, Sophia Mbakwe, the EVP said African countries lacked the necessary financial resources to fully develop their natural gas reserves and bring more volumes of gas to the ground.
He said the call for foreign investors’ supported was necessary to bridge the funding gap and support gas projects with advanced technology and expertise.
Speaking on the theme: “Role of Foreign Direct Investments (FDIs) in the Efficient Development of Natural Gas Reserves to Meet Africa’s Energy Security Demands,” Tombomieye, explained that Nigeria as a nation recognised the value of international collaboration.
He said: “We extend an invitation to our global energy community to join hand with us, to partner with African nations in the journey towards energy security and prosperity. We recognise the value of international collaboration as we have seen how partnership fostered by FDIs has propelled the growth of oil and gas industry and economics.
“As we converge on this momentum occasion, we found ourselves as a cross host of history. Africa landscape is evolving rapidly and the demand for a reliable, sustainable energy is on the rise. Our continent holds verse natural gas reserve, a valuable resources that can play a vital role in shaping Africa’s energy security future.
“The magnitude of our natural gas potential cannot be overstated, from abundant associated and non associated discoveries in Nigeria prolific Niger Delta to new discoveries in Senegal, Mozambique and other African countries. Africa is endowed with abundant natural gas resources and has the power to fuel economic growth, improve the lives of our people and elevate Africa to height of prosperity.”
He, however, warned that harnessing Africa’s huge gas potential was not without challenges, as it requires bold vision, strategic planning and substantial investment as well as a welcoming environment for FDIs.
“This is where FDI comes into play. Foreign Direct Investments can propel us forward to this transformative journey to unlock the immense possibility for Africa.
“FDI represents one of the most prominent instrument combating poverty, as it positively impacts the recipient country through creating employment, transferring technology, capacity building and knowledge”, the NNPC EVP stated.
Tombomieye further explained that the efficient development of the natural gas resource was one that demanded technology prowess, innovation and financial backing, adding that FDI brings with it not just capital, but also the expertise, knowledge and best practice that are essential to unlock the full potential of natural gas resources.
According to him “As a nation, we are committed to provide a business friendly environment, build on transparency, accountability and fair competition. Our goal is to inspire confidence to our investors, ensuring that their commitments are merged with their commiserate returns.
“In Nigeria for example: since the advent of the oil exploration and exploitation, FDIs has played a vital role in the financing for both hydrocarbon reserves and production as well. However, in recent time climate experts across the world are increasingly concerned about carbon emission from crude oil and gas production and consumption.
“This has contributed to the global warming and messy level rise in some part of the world, just as poverty also rises in other continent that lack access to energy.”
On climate change challenge, Tombomieye said the effect had led to the flow of FDIs for development of fossil fuel based energy in particular, coal and crude oil.
He further stated, “Climate concern have therefore shifted their focus of global conversations among policy makers and activists’ investors towards promoting investment in low carbon energy sources.
“Out of the $90 billion in FDI in Africa between 2015-2019, Nigeria only attracted four per cent due to issues emanating from what I have just mentioned above.
“We are therefore at a point where the world must make careful choices to balance the need of a gradual transition to low carbon energy, and at the same time address energy poverty in developing countries, particularly in Africa, to stimulate sustainable economic growth that is commensurate with a growing population. This is so vital to us.
“Africa is well aligned with the rest of the world in combating the impact of climate. But climate change policies must also sync with the realities in Africa and other developing nations.
“Africa only accounts for about three per cent of global energy consumption and less than three per cent of emissions.
“As Africa population continues to grow, energy demands should be expected to grow beyond the pace as which Africa clean energy market will grow in 40 years. Africa energy demands is expected to increase by about 30 per cent within the next 20 years and therefore the enormous gas resource will play a pivotal role in this regard”.
