Recent observations that a lot of matured Nigerian gas projects had been idle over a period of time when activities in Africa’s gas sub-sector are jumping in multibillion dollar deals are becoming a source of worry for industry pundits.
Currently, with new discoveries and investor-friendly policies in neighbouring countries like Mozambique, Ghana, Niger, Uganda, Kenya, Gabon, Senegal, Mauritania and South Africa, Nigeria is fast losing its attraction even as nothing is seriously coming as development policy initiatives from the government.
Checks around the NLNG showed that even as most gas projects are idle in Nigeria, Mozambique with its Coral Floating LNG project is at the verge of becoming the world’s largest gas producer with an estimated $128 billion flowing into the country’s gas sector alone before 2025.
Only recently, there are speculations that the Federal Government is looking to recover as much as $62 billion from IOCs due to a 2018 Supreme Court ruling on PSCs, which was amended few weeks ago.
But in a smart response, Total is reportedly seeking to sell its 12.5 per cent stake in a deep-water oilfield over attempt to expand into other Africa countries.
Already, there have been indications that ExxonMobil, Shell and Chevron might divest upstream assets in the country.
Findings by Business Hilights Intelligence Unit (BHIU) on the matter revealed that why most of the oil majors and especially one in particular, is yet to take a final investment decision on the over 200,000bpd project is tied to its concern about Nigeria’s regulatory environment.
Talking about the regulatory environment, the recently signed Production Sharing Contract (PSC) bill into law comes to mind on how it will change a lot of positive narratives to standstill narratives in the long run after all.
To many IOCs, issues bordering on fiscal stability is key to attracting investments in the country and the investment climate needs to be able to magnetise capital.
This fact is further buttressed by the Chief Executive Officer of an indigenous oil-servicing firm, Mudiame International Limited, Sunny Eromosele, said: “Most of the investment package that this administration met has not taken off for the past five years. The attitude of government is irresponsible, especially pushing companies away in the name of revenue generation.”
In the same vein, the Principal and Executive Director, Kaptepia Capital, Tosan Omatsola, has urged the Federal Government and regulatory agencies to address drawbacks to the growth of investments in the country and unveil incentives to encourage investors to the sector.
