FG Outlines Strategic Vision For Petroleum Industry Transformation

The Minister of State for Petroleum Resources, Senator Heineken Lokpobiri has presented a strategic plan to navigate the challenges and opportunities within Nigeria’s petroleum industry.

He said this during an address to the Oil producers trade section (a group by the five oil giants operating in Nigeria) at the Cross Industry Group (CIG) meeting in Istanbul, Turkey.

Lokpobiri underscored the sector’s central role in Nigeria’s economy, providing around 85 per cent of government revenue and serving as a vital source of foreign exchange.

As the global landscape shifts towards cleaner energy, he emphasized the necessity for Nigeria’s oil and gas sector to remain resilient, competitive, and profitable.

The minister outlined Nigeria’s dual approach to ensure the future of its petroleum industry by focusing on maximizing crude oil production and adapting to a cleaner energy transition.

“In the short term, our focus remains on increasing revenue from crude oil production,” Lokpobiri stated, affirming the government’s commitment to addressing operational bottlenecks and upgrading infrastructure.

Recognizing the urgency of cost reduction, he highlighted government measures aimed at streamlining operations, particularly upstream activities, to remain competitive in a fluctuating global market.

A significant part of the government’s vision involves balancing energy demands with environmental considerations.

Lokpobiri noted, “The world is moving toward cleaner energy, and Nigeria must be part of that transition.

” The government has prioritized natural gas as a cleaner alternative while actively exploring renewable energy options to diversify Nigeria’s energy mix.”

The minister extended an invitation to industry players to embrace investment in cleaner, more sustainable methods, stressing that Nigeria’s transition will remain pragmatic and focused on local priorities.

Acknowledging the persistent security challenges in the Niger Delta, the minister reported ongoing efforts to protect Nigeria’s oil infrastructure through enhanced security measures.

“We are engaging communities and encouraging partnerships that foster local ownership of critical assets,” he said.

Efforts include increased military support, particularly from the Nigerian Navy and Joint Task Force (JTF), combined with community engagement and economic empowerment initiatives to combat pipeline vandalism and oil theft.

The government has also implemented technology-driven solutions, including drone and satellite surveillance, to enhance the security framework and detect potential threats to the industry.

The minister noted the comprehensive package of reforms and incentives to revitalize Nigeria’s oil and gas sector, aiming to attract greater investment and stimulate economic growth.

“Key elements include the VAT Modification Order 2024 and the Tax Incentives Order for deep offshore oil and gas production, offering fiscal benefits to companies involved in the sector. In addition, directives focus on reducing contracting costs and timelines, mandating that the procurement cycle be streamlined to six months, enhancing efficiency for investors”, he said.