Minister Reveals Plan To Revolutionize The Oil Sector

The Minister of State for Petroleum Resources has unveiled a plan to tackle obstacles and capitalize on opportunities in Nigeria’s petroleum sector.

A statement on Saturday by the Special Assistant on Media and Communication to the Minister, Nneamaka Okafor, revealed that Lokpobiri presented the plan at the Cross Industry Group meeting in Istanbul, Turkey, while addressing a gathering of Nigeria’s leading oil producers.

The statement noted that Lokpobiri highlighted the oil sector’s critical role in Nigeria’s economy, noting that it contributes approximately 85% of government revenue and serves as a key source of foreign exchange. He emphasized the need for Nigeria’s oil and gas sector to remain resilient, competitive, and profitable.

The minister outlined a dual approach for the industry’s future, focusing on maximizing crude oil production while supporting a transition to cleaner energy.

“In the short term, our focus remains on increasing revenue from crude oil production,” Lokpobiri stated, affirming the Federal Government’s commitment to addressing operational bottlenecks and upgrading infrastructure.

Recognizing the urgency of cost reduction, he highlighted FG’s measures aimed at streamlining operations, particularly upstream activities, to remain competitive in a fluctuating global market.

“A significant part of the government’s vision involves balancing energy demands with environmental considerations. The world is moving toward cleaner energy, and Nigeria must be part of that transition. The government has prioritized natural gas as a cleaner alternative while actively exploring renewable energy options to diversify Nigeria’s energy mix,” he clearly stated.

The minister also urged industry players to embrace investment in cleaner, more sustainable methods, stressing that Nigeria’s transition will remain pragmatic and focused on local priorities.

Acknowledging the persistent security challenges in the Niger Delta, the minister reported ongoing efforts to protect Nigeria’s oil infrastructure through enhanced security measures.

He said, “We are engaging communities and encouraging partnerships that foster local ownership of critical assets. Efforts include increased military support, particularly from the Nigerian Navy and Joint Task Force (JTF), combined with community engagement and economic empowerment initiatives to combat pipeline vandalism and oil theft.

“The government has also implemented technology-driven solutions, including drone and satellite surveillance, to enhance the security framework and detect potential threats to the industry.”

He also noted that the comprehensive package of reforms and incentives to revitalize Nigeria’s oil and gas sector aims to attract greater investment and stimulate economic growth.

“Key elements include the VAT Modification Order 2024 and the Tax Incentives Order for deep offshore oil and gas production, offering fiscal benefits to companies involved in the sector. In addition, directives focus on reducing contracting costs and timelines, mandating that the procurement cycle be streamlined to six months, enhancing efficiency for investors.

“By incentivizing both non-associated gas and deep-water developments, Tinubu’s administration seeks to bolster Nigeria’s competitiveness as an energy investment hub in Africa. This forward-looking framework is designed to harness the country’s resources while diversifying revenue streams, ensuring a balanced approach that supports growth and sustainability in Nigeria’s oil and gas industry,” Lokpobiri stated.

Additionally, the minister highlighted the government’s steadfast commitment to the Nigerian Oil and Gas Industry Content Development Act. While promoting local content is critical, he acknowledged the need for a balanced approach to avoid creating barriers to foreign investment.

He assured stakeholders that discussions are underway to align NOGICD Act amendments with the dual goals of fostering local growth and maintaining investor confidence.

He further called for greater commitment from industry players to support Nigeria’s ambitious plan to increase oil production by over one million barrels within the next 24 months.

“We cannot afford to hold valuable fields in perpetuity. Either you put them to work or relinquish them. The era of renewing licenses without development is  over, he stated.

Lokpobiri’s address served as a clarion call to industry stakeholders to collaborate in securing Nigeria’s energy future, emphasizing that “Nigeria’s petroleum resources hold immense value and potential. Realizing this potential requires addressing our challenges and leveraging our strengths to ensure shared prosperity and energy security.”