- An energy Expert, Funny Ogbue has advocated ways of reviving the oil industry in Africa
- Ogbue, the President of Women in Energy Network, said this in South Africa when she stated the need to attract more oil investment to Africa
- According to her, the problem of divestment from the oil sector in Africa is a source of concern
Industry stakeholders gathered in South Africa to mark Africa Oil Week and engaged in initiatives to develop the continent using its natural hydrocarbon resources.
The Managing Director of Zigma Ltd and President and Co-Founder of Women in Energy Network, Funmi Ogbue, delivered a lecture on revive the Upstream Sector and making it an attractive destination for investment.
Steps to tackle divestments
She also addressed divestments, environmental sustainability and governance (ESG) problems, and policymaking using political, financing and technological considerations.
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Ogbue said industry advocacy groups like Oil Producers Trade Section (OPTS) in Nigeria were a useful tool to help push a clear and harmonised set of standards for implementing ESG goals in African countries and working in partnership with the energy ministries.
"Building blocks for this are already present on the continent like Nigeria with its use of International Finance Corporation (IFC) Performance Standards and South Africa with Code for Responsible Investing in South Africa (CRISA)," she said.
She noted that if successfully implemented, the standards could become legislation enabling uniformity and stability on the continent, making Africa a more attractive investment destination.
"This presents an opportunity for the African energy industry to set the pace for the development and implementation of ESG standards in consonance with continental realities and growth aspirations."
Ogbue noted that to stem the flow of divestments and create stronger ESG and climate policies, financing strategies such as focusing on encouraging new participants in the investment landscape were advisable.
Symbiotic investors such as oil traders whose business model depends on a thriving upstream industry are considerable. In one such recent transaction, Sirius Petroleum, a United Kingdom (UK) independent, executed a senior loan facility with Trafigura in 2021 to fund E&P activities in Nigeria.
Increased participation of symbiotic investors could lead to a better competitive lending environment on the continent, according to Ogbue. "Raise funds from investors who share similar ESG and commercial outlooks, she stated.
Wrong perception plague industry
According to the New Telegraph, Ogbue decried the outsiders' perception that oil and gas companies were weakly committed to decarbonisation. Quoting a report by the International Energy Association (IEA), "Global investment in clean energy in 2020 by the oil and gas industry was 1% of capital expenditure.
"The energy transition to zero-carbon is a journey that will take more time than anticipated as the policy meets reality (as witnessed with the current global energy crisis). Nevertheless, the oil and gas industry will remain relevant through this period, albeit in a diminishing capacity. However, only operators that follow rhetoric through with action will survive.
"The opportunity here is for Africa to stay slightly ahead of the curve to attract funding. If the rest of the world is doing 1% of CAPEX on ESG compliant projects, then Africa doing 5% will send the right signals and attract investment," she added.
NNPC locates, shuts down 395 illegal refineries associated with Forcados, hints on illegal oil pipeline
Recall that Legit.ng reported that the Nigeria National Petroleum Company Limited (NNPC) is putting all its efforts into stopping the monstrous growing oil theft in Nigeria.
According to the company's Chief Executive Officer, Mele Kyari, the firm has discovered and dismantled the operations of about 395 illegal refineries linked to the Forcados, a small town in the Niger Delta.
Kyari said the company had deactivated the illegal refineries, taken down 273 wooden boats, and ruined 374 illegal reservoirs and 1,561 metal tanks.