Sylva Explains Why International Oil Companies Leaving Nigeria is Big Trouble for Federal Government Finances

Sylva Explains Why International Oil Companies Leaving Nigeria is Big Trouble for Federal Government Finances

  • The federal government has underlined its concern over international oil companies leaving the country once again.
  • The latest source of concern comes from Nigeria's Minister of State for Petroleum Resources, Timipre Sylva, who confirmed the oil industry's lack of funding.
  • Sylva feels that with oil companies leaving Nigeria, the country's oil production target is in trouble, which might have a financial impact

The Federal government of Nigeria has again expressed concern at the speed international oil companies (IOCs) are leaving Nigeria.

According to the Minister of State, Petroleum, Timipre Sylva the action by oil companies to diversify into cleaner energy is the reason why Nigeria is not producing enough oil to sell.

According to Dailytrust, Sylva said the current 1.8 million barrels per day oil production quota assigned by the Organisation of the Petroleum Exporting Countries (OPEC) is bow becoming more difficult to achieve.

Sylva Explains why International Oil Companies Leaving Nigeria is big trouble For Federal Government finances
Shell has been one of the companies mentioned in the media looking to abandon oil production. Credit:Shell

The Minister of State, Petroleum, Timipre Sylva stated this at a ministerial plenary, at the ongoing Ceraweek, in Houston, Texas.

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Nigeria’s OPEC quota is pegged at 1.8m bpd but in the last few years, the country has struggled between 1.3m and 1.4m bpd.

Speaking at the event Sylva said:

“The rate at which investments were taken away was too fast. Lack of investment in the oil and gas sector contributed to Nigeria’s ability to meet OPEC quota. We are not able to get the needed investments to develop the sector and that affected us.”

The minister also cited security challenges affecting the growth of the petroleum sector as well as the discouragement of funding for the sector due to a concerted shift to renewable energy.

Sylva pleads

According to a statement released by his spokesperson, Horatius Egua, the minister called for a pleaded with the IOCs while stating that hydrocarbons will continue to play a critical role in addressing the world's energy demands for decades to come.

Sylva reminded the audience that Africa should be allowed to lead a progressive energy transition in order to address the demands of the approximately 600 million people who do not have access to electricity.

He added:

“There are about 600m people in Africa without access to power and of that number the majority live in Nigeria. And of the over 900m people without access to power in the world, the majority live in Africa. So how do we provide access to power for these people if you say we should not produce gas?
“We believe that gas is the way to go. We believe that gas is the way forward and the one access to power,”

Russia threatens US, others of dire consequences if ban of its oil and gas takes effect

Legit.ng has reported that Russia is puffing warning to Washington and its European allies that if they should go ahead and implement a ban on its oil and gas, the ripple effects will reverberate across the global oil markets

The country has threatened to shut down a major gas pipeline to Germany and said that oil prices will hit $300 per barrel if the West makes good their threats, according to a report by CNBC.

Russia’s Deputy Prime Minister, Alexander Novak said on Monday, February 7, 2022, that it is obvious that a rejection of Russian oil will lead to disastrous outcomes for the global market.

Source: Legit.ng

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