Bank-Anthony Okoroafor is the Managing Director, Oilfield Services Company. In this interview with ABIOLA ODUTOLA, the chairman of Petroleum Technology Association of Nigeria, an umbrella body for all oil services companies in Nigeria, spoke on several investment opportunities in the oil and gas sector. Excerpts
What is your assessment of the Nigerian oil sector?
We need a lot of activities in the oil and gas sector to sustain the capacities and capabilities built so far. This is not happening now. There are no projects. We should, as a country, plan to always have sustainable projects.
After Egina now, what happens to all the capabilities built if there is no project coming up on the horizon. This will be a monumental disaster. What will be the fate of Nigerdock, Ladol, Aveon, DormanLong, Slot, EnergyWorks, OilServe, Vhelbherg and other stakeholders? We should remove all bottlenecks that are slowing down the coming on stream of mega projects.
A lot of equipment and personnel are idle. We must push the Zabazaba, The Bonga SW, and other big projects to the front burner. The level of well services in Nigeria is very low. That is why equipment utilisation by well services companies like Geoplex, Emval, Weafri, BGT, OilData, GPPS, AFIS, Sowsco, OilTest, Mansfield, Drillpet, Segof, is at a low ebb.
What are your expectations in 2018?
I expect government to get our oil and gas policies from the draft level to real policies, push for domestication of the sector’s big projects in the country, such as sustainable peace in Niger Delta, passing of Petroleum Industry Bill, creation of more indigenous exploration and production operators, more gas projects, gas flare commercialisation, and increased well services activities.
In present-day Nigeria, oil accounts for 95 per cent of foreign exchange earnings and 75 per cent of government revenue for Nigeria. The implication of extended militancy/vandalisation/crude theft in this low oil price environment for a Nigerian economy which runs mainly on a single commodity, is dire
Nigeria’s crude oil production has not been able to reach the 2.5 million barrel mark, owing to several challenges. What are these challenges and what is your advice on how to tackle them?
The challenges include Pipeline vandalisation, crude thefts, militancy and OPEC production limits. Restoring sustainable peace agreement in the Niger Delta and genuine empowerment of the youths should address some of these issues. Restore confidence in the security of people and assets in the entire Niger Delta. In present-day Nigeria, oil accounts for 95 per cent of foreign exchange earnings and 75 per cent of government revenue for Nigeria.
The implication of extended militancy/vandalisation/crude theft in this low oil price environment for a Nigerian economy which runs mainly on a single commodity, is dire. This environment creates high risks. At $69/bbl., countries like Nigeria with a large population, low reserves and an over-dependence on oil, could become severely stressed if we cannot produce and sell more bpd. These are interesting times because the mono-product that Nigeria’s finances hang on is being threatened by this militancy. About 95 per cent of Foreign Exchange Earnings are tied to oil and with shortened revenues in dollars’ terms, the Naira will be under continuous pressure. E & P Operators are all suffering since the export pipelines are all down sometimes. This creates collateral damage for the country, the operators, service companies and all of us.
How have the indigenous oil service firms benefitted from the Nigerian Content policy and how can the Federal Government attract more patronage of local oil firms in the country?
Indigenous oil service companies have benefited because the Nigerian Content Policy has made it mandatory to give jobs to competent Nigerian service companies with the capacities and capabilities needed. You now have indigenous marine vessel companies like Marine Platform and indigenous rig companies like Unitherm, Tecon, and more fabrication tonnages now being done in the country.
The policy has created a lot of in-country value retention, more human capital development and more empowerment of Nigerians. The government must ensure that the Nigerian Content policy, which is always on the front burner, is not tampered with in any form or guise. The government should introduce it to other sectors of the economy.
What are the benefits of the West African International Petroleum Exhibition and Conference to the Nigerian economy and the oil and gas sector?
It is focused more on high-level strategic sessions and discussions on game-changing solutions for the oil and gas industry. The focus is on how to remove bottleneck and grow the industry while leaving the technical programs for SPE, NAPE etc.
The content, the programs, the quality of the delegates and communique from the event, have always been a pacesetter and pathfinder for the oil and gas activities for the year. It is different from other conferences because it is a bespoke industry program by the industry people for the growth of the industry.
Offshore Technology Conference has grown to become a big event that attracts stakeholders all over the world. What have you put in place to make WAIPEC compete with OTC?
WAIPEC’s mission is to promote the region’s oil and gas industry, seek industry best practice, explore new technologies and develop commercial opportunities for business and international investment. Our focus is on Africa.
Will this not affect the level of participating countries and companies?
No, it will not affect the level of participation because Companies are looking for solutions and also the WAIPEC creates a great networking opportunity for the industry covering the entire African sub-region.
