IOCs’ Divestment: Indigenous Firms Ready to Take Over Oil Exploration – IPPG Chairman

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…….Says IPPG has invested $20bn in 10 Years

Chairman of the Independent Petroleum Producers Group (IPPG), Mr. Abdulrasaq Isa, has posited that Nigerian indigenous companies have the technical and financial capacity to take advantage of the opportunities presented by divesting international oil companies (IOCs) to up their stake in the industry.

Isa who spoke at the ongoing 2022 Nigerian Oil and Gas (NOG) conference, allayed concerns over the ongoing divestment of assets by the IOCs.

According to him, members have invested over $20 billion on acquisition of equipment and facilities, and on capital expenditures in the 10 years to grow the divested assets.

The IPPG chairman said members of the group have a proven track record of performance and remain best placed to guarantee a steady flow of investments in adding value to these divested assets.

“Some of our members have demonstrated an appetite for supporting the government’s energy vision by building a broader value-adding midstream and downstream business.

“Overall, our members have deployed unique capabilities in operations which have minimised incidences of disruptions and enhanced impactful community engagement models. IPPG strongly believes indigenous players have the technical and financial capability to realise the government’s aspirations for the sustainable growth of our industry.” added Isa.

He pointed out that in the last decades the number and contribution of indigenous players has significantly increased, a trend he said may be owed to government policy and the divestment decisions of the IOCs.

Isa described the theme of this year’s edition of the conference: “Funding the Nigerian Energy Mix for Sustainable Economic Growth,” as apt, adding that it underscores the importance of repositioning the industry in the face of the ongoing global energy transition.

According to him, the promulgation of the Nigerian Industry Content Development Act ( Act) in 2010, has provided support for the emergence of stronger indigenous oil & gas firms, and has complemented government’s empowerment agenda.

“This trend must be further supported and sustainably nurtured. It is the sure way to achieve energy availability, affordability and for all Nigerians” he said.

Isa said the IOC divestments in 2010 ushered in a period of significant growth both for the Nigerian Petroleum industry and for the indigenous players in terms of overall contribution to the nation’s production – translating to a net contribution from as low as 3% in 2007 to about 16% within a decade.

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