It’s times for Nigeria to consider reduction in cost of crude oil production- Senate President


By Kingsley Okoye

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Abuja,Jan.30,2021 President of the Senate, Ahmad Lawan has advocated for a reduction in the cost of crude oil production by International Oil Companies (IOC’s) operating in Nigeria.

Lawan made the call on Thursday in Abuja, while receiving a delegation of Oil Producers Trade Section (OPTS) in Abuja.

He said that the Petroleum Industry Bill (PIB) at the National Assembly would make provisions for reduction in the cost of crude oil production.

“The cost of production in Nigeria is a major concern in the oil industry, my colleagues in the committees that are oil and gas related know better.

“But from the little I understand, while Saudi Arabia may spend 5 dollars to produce a barrel, we are spending about 30 dollars to produce same in some cases.

“The time has come for us to ensure that the cost of production is beaten down to a more meaningful and profitable production cost.
“We must do everything possible together to ensure that the host communities benefit from wherever they are supposed to benefit from.
” Not only the host community development fund, but in the Niger Delta Development Commission (NDDC) and other areas of government intervention,the Amnesty Programme and Ministry of Niger Delta Affairs.

“How do the host communities benefit, because we need to stabilise those areas so that we have cheaper production costs,” he said.

Lawan, while emphasising the importance of the PIB towards advancing Nigeria’s economy, assured that the Senate would accommodate the interest of international investors in the bill.

He, however, decried low inflow of business investors in Nigeria, attributing it to absence of a legal framework which the PIB sought to address.

“In the last 20 years, investments coming into Nigeria and this industry have been so dismal and so small compared to the size of what we have elsewhere, maybe due to lack of a legal framework – the PIB.

“So, we are very conscious of ensuring a balance and equilibrium between our interest as a people and a country, that we should have all the benefits accruing from your operations.

“We need to help you by creating that kind of environment where you’re able to argue and get the investments flow into Nigeria, instead of elsewhere. Let me also add, that at the end of the day, this is going to be a balanced legislation.

“For us as a country, we will not do anything that would jeopardise the chances of our oil industry competing favourably with other climes.

“So, I want to assure you that we would look into those issues of concern to you, and we would do exactly what we think will be in the best interest of Nigeria and also in the interest of the OPTS,” Lawan said.

Earlier, leader of the delegation, Mr Mike Sangster of Total Nigeria, said the visit was to engage the National Assembly on areas to modify in the PIB to ensure its success when signed into law.

“On behalf of all of the industry and my colleagues, I want to say that we duly support the government’s effort to drive through the Petroleum Industry Bill.

“We think it is really important that there’s an updated framework for the industry.

“In our view, we are looking for something that will contribute to Nigeria, which will bring investment to the country and growth to the economy, and obviously jobs to the Nigerian people.

“We are looking for something that will protect our existing investments, and also unlock opportunities so we can further grow our businesses and production.

“We need to find ways jointly to try and reduce what we see as the cost premium of operating in Nigeria, so we are looking at ways where the PIB can help there,” he said

By Naija247news
By Naija247news
Naija247news is an investigative news platform that tracks news on Nigerian Economy, Business, Politics, Financial and Africa and Global Economy.

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