The recently concluded oil and gas conference in Abuja has raised hope for a sizeable investment in the oil and gas sector in the country. Ibe Kachikwu, ministed of state for petroleum, hinted while delivering his paper on Reforming and Repositioning the Oil and Gas Industry in Nigeria that the federal government plans to attract investment worth $10 billion into the oil and gas industry yearly to bridge infrastructure gap.
According to him, the investment will address the current challenges in the industry, particularly pipelines, refineries, gas and power, facility refurbishments and upstream financing. Ultimately, he hopes this will bridge the gap in infrastructure funding in the sector.
“Time has come to bring down the cost of crude oil production and put the right incentives in place. Currently, we have cost and technological issues. Between 2015 and 2016, we took drastic measures on how to moderate prices while from July 2016; there have been lots of stability in the downstream economy. There are still some challenges but there is work in progress,” said Kachikwu.
The minister explained that the problems of the upstream sector of the petroleum industry included the Joint Venture, JV, funding debt and other litigations estimated at $6 billion, cost of production per barrel crude oil currently at between $27 and $28, a cost he said the federal government is determined to bring it down to about $18.