NUPRC suggests exploration of oil, gas as solution to short, medium terms global energy crises

Oredola Adeola

 Engr. Gbenga Komolafe, Commission Chief Executive(CCE) made this known on Tuesday when he delivered a goodwill message on the theme: “Global Energy Transition & the Future of Oil and Gas Industry: Evolving Regulations, Emerging Concepts & Opportunities”, at the opening ceremony of the 40th Annual International Conference and Exhibition of the Nigerian Association of Petroleum Explorationists (NAPE) 2022 in Lagos.

 The Commission Chief Executive,(CCE), who was represented at the conference by Mr. Abel Nsa, Head of National Oil and Gas Excellence Centre (NOGEC), charged operators in the upstream sector to show more commitment to adapting to a changing policy and investment landscape by being intentional about decarbonizing their oil and gas facilities.

According to him, apart from the commitment to decarbonise the oil and gas facilities, the right discourse and policy direction are needed to guarantee energy security as the country journeys towards achieving net zero targets.

He said, “The global push for energy transition, the future of the oil and gas industry, and our commitment to the Paris agreement COP15 and recent COP26, have therefore placed a demand on all of us to keep global temperature below 1.5 to 2 degrees Celsius.

“The implication of this on the oil and gas industry in Africa is far-reaching. We now have the opportunity to make valuable points to the global discourse.

“As the quest for cleaner energy and carbon footprint garner momentum, there is therefore the need for all gas producers in Nigeria to embrace the reality of energy transition and take strategic positions to leverage the opportunities presented by the unfolding era. This has become more important,” the CCE said.

Engr. Komolafe while allying to the fear of investors in the Nigerian and African hydrocarbon industry, particularly on the upstream side of the industry, disclosed that recent development around the globe indicated that fossil fuel would continue to be an integral part of the energy mix, even beyond the 2060 target set for achieving net zero.

He argued that the United Kingdom, having come to term with the reality of just and fair energy transition, in October 13, 2022, through the  North Sea Transition Authority, commenced the process of awarding more than 100 licences to oil companies, with commitment to extracting oil and gas in the area.

He noted that as a result of that development, almost 900 locations were offered up for exploration, in a new licensing round to allow oil and gas companies to explore for fossil fuels in the North Sea,  despite threats of a legal battle from climate campaigners.

The CCE therefore called on fossil-based economies in Africa to rise to the challenge of exploring their resources to reduce the impact of the rising energy prices that have reached record highs, and depleting oil and gas supplies.

He said, “Given this outlook, and in view of the growing energy demand in the short and medium terms, fossil-based economies(Nigeria inclusive) need to meet this target by deploying a more advanced technology to optimise production within the energy mix.

Komolafe there restated the commitment of the Commission to working with all stakeholders in ensuring that business investment in the oil and gas sector are adequately protected, adding that NUPRC will strive to ensure that all bottlenecks associated with all regulatory framework are eliminated to guarantee seamless operations in the sector as presented by the provision of the Petroleum Industry Act(PIA 2021).

He said, “Nigeria has a lot of gas, while incorporating this as part of our transition plan towards clean energy, this energy source with low carbon footprint will go a long way in the country’s attainment of the net zero targets.

“The future of Nigeria’s upstream, with proven a reserve of about 208 trillion cubic feet (tcf) and over 600tcf of unproven of natural gas as well as crude oil  with 37 billion barrels proven reserve, need the right regulatory and policy framework to match up with energy sustainability.

“Accordingly, the recently enacted PIA has attractive provision for the development of activities within the upstream not just for the development of oil but for harnessing the mixed gas potential of the nation which is the highest in the world,” the NURPC boss said.

He further noted that the Commission is committed to fulfilling four cardinal regulatory responsibilities, including oil and gas reserve growth, optimising gas production, encouraging domestic gas utilisation, and ensuring flare gas elimination.

He said, “The PIA mandates the Commission to promote healthy and safe, efficient conduct of upstream operations in an environmentally acceptable and sustainable manner, while also ensuring the implementation of environmental laws and policies for upstream.

He said, “A section of the PIA makes provision for environmental management and degradation funds, natural gas flare enumeration and monetization plan and gas flare penalties to give meaning to the intent and letter of the act.

He noted that the enactment of the PIA has opened the door for the development of the Nigerian oil and gas industry designed to ensure that oil and gas development is carried out in an environmentally friendly and sustainable manner.

He, therefore, challenged stakeholders in the industry and environmental advocates to focus the energy transition discourse more on the implementation of a fair, equitable, and sustainable energy mix, that is entrenched in the principles of inclusiveness, while also guaranteeing energy security for Africans.

 He said, “While we deliberate on the global energy transition from fossil-based sources to renewables, the discourse around the African upstream oil and gas industry should be open and unbiased.

“Energy transition must be balanced and dedicated to meeting the energy needs of the developing countries. Africans and fossil-based economies must the offered the right to use their God-given natural endowment to develop their economies,” Komolafe said.

The CCE further challenged stakeholders to focus more on the safe disposal of carbon dioxide and what was achieved be to harnessing gas resources and opening the access to funding of petroleum assets.

 Komolafe, therefore, cautioned that the concept of just transition is necessary and should be tilted toward enabling fossil-based economies like Nigeria to use the hydrocarbon resources to develop their infrastructure.

He said that the development of infrastructure within the next century must therefore be just and fair to enable Africa to catch up with the level of development similar to developed nations while transitioning to green energy