The hope for Nigeria returning to a season of boom in her crude oil production has been predicated on improved technology and expertise, the industry experts said.
In an exclusive interview with the Editorial Director, European and African Oil, S&P Global Platts, Andrew Bonnington during the organisation’s recent Lagos Oil and Energy Forum in Lagos, told Orient Energy Review that there are high hopes for Nigeria returning to improved crude oil production.
According to Bonnington, “a lot of it is around improving technology. One of the ways Nigeria can be more competitive is the embraces she has done to new technology, new expertise and to more foreign investments. Nigeria has a lot of foreign investments; if she continues to do so, that will improve the efficiency of the industry.”
Noting that the impact of the downward slide in crude oil price have been severe on the country’s economy, Bonnington said that it has also come with some benefits.
“It has led the government to initiate discussion on libralising the prices of gasoline and Premium Motor Spirit (PMS). So, the fall in price has led to better discussion at government level in deregulating the market, which can be of benefit to Nigerian people in the future.”
On the global market outlook of sweet and sour crude, the Director said that he was aware that Nigeria is already discussing on lowering the sulfuric content of it’s PMS. And that moving from sour to sweet crude remains an achievable goal but not without some costs. “Right now, Nigeria gasoline is one of the highest sulfuric content in the world, which is bad for the environment as well as the humans that breathe in the fumes.
“Nigeria as an importer of huge amount of petrol and gasoline, if she continues to import that much, and the sulfur content lows, the cost to the government or the consumers will certainly rise. The lower the sulfur content, the chances are consumers will pay more. It is a question of balancing the cost, he said.
He attributed part of Nigeria’s problems to insufficient refineries in the country which he said has left the country with the option of importation. And that with the coming on board of the likes of Dangote refinery and others, Nigerian crude will remain competitive as it rebounds soon.
Noting the recent improvement in OPEC price, the Editorial Director as well as a facilitator at the forum, Joel Hanley said that though the price hovers around $50, it may be a bit difficult to predict further rise when there is a lot of oil in storage.
According to Hanley, if Nigeria can pursue security of supply, generate trust and goodwill, it will in turn produce higher price for the country’s crude.
“The market is a bit more resolute right now. The truth is that if any country, not just Nigeria alone can produce security of supply, generate trust and goodwill, that will produce higher crude oil price. That is what Nigeria should aim at doing right now; China and Angola are already doing that, Hanley said.