… seeks to boost Nigeria’s energy security, local refining capacity
…Nigeria leads move to harmonize African oil, gas regulators for maximizing value amid energy transition
Oredola Adeola
In response to the stakeholders’ calls for streamlining the regulatory framework in the petroleum industry, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) stated that it is enhancing its alignment with the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) on administering the Domestic Crude Supply Obligation (DCSO) and the Domestic Gas Delivery Obligation (DGDO) to grow the sector in line with the Petroleum Industry Act.
This comes amid recent outrage by Dangote Industries Limited (DIL), accusing International Oil Companies (IOCs) and their trading arms of selling crude oil cargoes at $2-$4 per barrel above the official market rate, making it difficult for the refinery to purchase local crude.
Advisors Reports gathered that the collaboration between NUPRC and NMDPRA is expected to enhance Nigeria’s energy security by ensuring a reliable domestic supply of crude oil and natural gas while boosting local content through increased employment, capacity building, and economic growth.
Engr. Gbenga Komolafe, Commission Chief Executive (CCE) made this known in his goodwill message at the opening ceremony of the 2024 Nigeria Annual International Conference &Exhibition (NAICE) organised by the Society of Petroleum Engineers (SPE) Nigeria Council.
The CCE stated that the theme of the Conference: PETROLEUM INDUSTRY VALUE CHAIN OPTIMISATION: THE INEVITABILITY OF MIDSTREAM AND DOWNSTREAM DEVELOPMENT”, aptly captures the critical juncture at which our industry stands and the path we must tread to secure a sustainable and prosperous future.
He added that the theme aligns with the objectives of the Petroleum Industry Act, 2021(PIA) for overall industry stability, growth, and sustainability.
According to him, ” A core imperative of the PIA is to ensure that the midstream segment is developed as a standalone segment to transition the nation from oil-centric operations to an oil and gas-based industrial economy.”
Engr. Komolafe who was represented at the opening ceremony by Mr. Enorense Amadasu, Executive Commissioner, Development and Production, NUPRC, emphasised that the Commission is entrenching collaboration with the NMDPRA, and other key stakeholders to deepen end-to-end value in critical areas of operations within the oil and gas sectors of the Nigerian economy.
According to him, NUPRC is confident that the efforts to foster regulatory alignment in this respect will stimulate further activities for domestic energy security in the short term.
He said, “We will not rest on our oars! We are committed to entrenching collaboration for enhanced value to the industry and the nation.”
Komolafe further emphasised that the optimization of the midstream and downstream segments is not merely an option but an inevitability.
The Commission’s Chief Executive said, “By focusing on these areas, we can mitigate the risks associated with market volatility, enhance our refining capacities, and ensure a more stable and efficient energy security for our nation, in a world undergoing change.”
Highlighting the importance of conscious actions to mitigate the impact of energy transition and position the nation for a decarbonized world, Komolafe noted that “No matter what our individual views may be, the world is on the energy transition course.
He said, “Hence, deepening of in-country value from our oil and gas resources via mid- and downstream operations is highly imperative.
“Thus, we must take concrete steps towards upstream decarbonisation, whilst creating the structures that allow midstream operations to strive and diversify our economic base.
The CEE further disclosed that the Commission is therefore championing decarbonization initiatives to sustain (and grow) investment in upstream oil and gas while entrenching Environmental, Social, and Governance (ESG) principles.
He said, “For us at the Commission, we have made deliberate and conscious efforts to position the Upstream appropriately through the implementation of the ongoing Regulatory Framework for Upstream Decarbonisation and Carbon Monetisation in Nigeria.
Komolafe also disclosed that the Nigerian Government is rallying the continent’s oil and gas regulators towards a harmonized position to deepen value across the value chain from Africa’s abundant oil and gas resource, in a world undergoing transition.
He stated that the collaboration will be achieved through the recently established Africa’s Petroleum Regulatory Forum (AfriPERF) which will foster collaboration, promote best practice dissemination, and enable the co-creation of approaches that support our national aspirations for energy security and economic development from petroleum resources.
The CEE further emphasised that whereas the industry faces issues and emerging dynamics, TOGETHER, all stakeholders and regulators can confront these challenges and mitigate their impacts for overall industry growth and sustainability.
He said, “We stand together with you to work out measures and mechanisms to achieve the imperative of Petroleum Value Chain Optimization.
” Together, we can create a resilient and diversified energy sector that not only meets our domestic needs but also positions Nigeria as a formidable player in the global arena.
“Optimising value across the petroleum value chain, in a sustainable manner, is the key to achieving that noble objective,” Engr. Komolafe said.
