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We’ll Scrutinise Investors In Divested Oil Assets –FG

The Federal Government has said it will carefully scrutinise oil companies that will bid for the takeover of assets that Shell and other oil majors will be divesting from in the country.

Shell and ExxonMobil had indicated their interests to divest from onshore and shallow water assets in the country.

Speaking at a separate business meetings with top managements of Chevron and Schlumberger at their headquarters, in Houston, Texas, United States (US), Minister of State Petroleum Resources Chief Timipre Sylva said the Federal Government will carry out due diligence in the selection and eventual approval of any company that will take over the assets from which these companies are planning divestment.

He stated that the previous practice where by companies are just allowed to purchase strategic without verifying their capacity to operate such assets would no longer be tolerated.

Sylva said: “In the past companies were just allowed to buy assets that they had no capacity to operate. We would no longer allow that to happen again because government is the ultimate lover. If they are not able to operate such assets optimally government won’t be able to generate revenue from such assets. So we are going to do our best to ensure that will get the best value from these assets.”

He told Chevron and Schlumberger teams that government would create the enabling environment for them to increase their investments in Nigeria adding that with the passage of the Petroleum Industry Act (PIA) Nigeria would increase the incentives for investments in the oil and gas sector of the economy.

“With PIA we now have the enabling laws that protect and make the operating environment more attractive. With the passage of the PIA there are a lot of interests in the oil and gas sector in Nigeria today. The responses we have gotten from investors so far it’s quite good. Everybody is quite happy,” Sylva said, adding that the Federal Government while willing to encourage new investors would open its doors first to those who already have business and investments in the country.

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The minister who also spoke on cost optimization, security of oil and gas assets, domestic gas utilization called for more investments in the sector.

At a breakfast meeting organised by the African Energy Future, Sylva urged the African continent to wake up to find solution the African problem or the word would leave Africa behind.

Sylva who spoke yesterday morning at the Hyatt Regency Hotel, Houston, said with the Omicron virus ban placed on Africa and the rush for energy transition, the continent leaders need to look for urgent financing solution if the continent will continue to play key roles in the hydrocarbon sectors.

Organisation of Petroleum Exporting Countries (OPEC) Secretary General, Dr. Mohammad Sanusi Barkindo yesterday also said the current global energy crisis is a larger picture of what it could become if the complexities are not comprehended.

In his opening remarks at the 23rd World Petroleum Conference in Houston, US, he said: “The current energy market turmoil seen across the world in recent months is perhaps an early insight into some of the issues we are dealing with, and what can occur if we do not see the bigger picture and the interwoven complexities.”

The OPEC scribe sought concerted efforts at addressing the current energy crisis instead of a divisive approach.

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He said: “Our energy future is not about ‘Them’ or ‘Us’. It has to be about ‘We’.

Working together, he said, “we can build an energy future worthy of future generations.”

Barkindo warned that stifling investments in the oil and gas industry will be perilous to the producers and consumers.

He said “If necessary investments are not made it could have knock-on implications, and leave long-term scar, particularly for security of supply, affecting not only producers, but consumers too.”

Barkindo described US as a vital cog in the global oil and energy markets, as both a major producer and consumer.

He said the OPEC welcome the decision of Biden administration to return to Paris Agreement, and take the lead at COP26.

According to him, the energy transition and global conversation around it would be incomplete without the US at the head of the multilateral table.

He said the oil and gas producers are also key to addressing energy transition, since there are oil and gas producers all over the world.

He sought all inclusive dialogue for the energy transition instead of the disruptive manner.

Barkindo said “for many of the world’s population, electric vehicles do not offer a viable alternative to the internal combustion engine, primarily due to cost.

“There is also debate about how environmentally friendly they are considering their build process, especially the required batteries, mining for minerals and metals, and the sourcing of the vehicles’ electricity.”

Source: Nation

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