Two of the major international oil companies (IOCs) operating in Nigeria, TotalEnergies and Shell Petroleum Development Company of Nigeria Ltd (SPDC) have called for a review of the Petroleum Industry Act (PIA) by the Federal Government, to give clarity on fiscal and marketing terms of deep-water gas investments in the Nigerian oil and gas sector.
This was part of the issues raised during a panel session at the ongoing sixth edition of the Sub-Saharan African Petroleum Exhibition and Conference (SAIPEC 2022) with the theme: “Fostering Collaboration to Create Cross Border Partnerships across the Oil, Gas and Energy Spectrum” in Lagos.
The representatives of the two major IOCs emphasized that such a move would help open the sector for more participation by the private sector. They further charged the FG to encourage make attractive provisions in the PIA to enable investors participate in deep-water production of gas.
Mr. Victor Bandele, Deputy Managing Director, Total Energies Deep-water, in his remark on how the PIA would impact investment in low carbon economy in Nigeria, said, “There is a drive for investment in gas production. We need clarity on the marketing terms of the gas. This must be attractive for the investors.
“But when you look at the PIA itself, it has brought clarity to the fiscal terms. So, investors can now come in, review the terms and decide whether they are comfortable with them. They can now make informed investment decision on these.
“The area that is silent in the Act , is the need for FG to make provision of incentives for gas marketing. So, this is something that is not so obvious.
“In the next few years, we would begin to see clarity on how we can move forward on new projects that will be attractive to the investors and good for the country itself,” Bandele said.
Also, during a panel session on the theme: “IOCs: Dynamics of Sub-Saharan Africa’s Energy, Oil, Gas Industry, as We Strive to Low Carbon Future”,
Mrs. Elohor Alboni, Managing Director, Shell Nigeria Exploration and Production Company (SNEPCO), who was represented by Mr. Bashir Bello, Shell’s General Manager, Business Development and Government Relations, said issues around Deepwater gas provisions in the PIA need to be reviewed to bring in better fiscal terms.
According to her, reviewing the PIA for a better fiscal terms on gas investment would allow investors to support government’s efforts in maximizing its gas production.