The Director, Department of Petroleum Resources (DPR),
Mr Auwalu Sarki, on Thursday, called for improved collaboration among stakeholders in the oil and gas industry.
He spoke during a webinar organised by World Energy Council and Future Energy Leaders Nigeria, in which he delivered the keynote address.
Sarki said the petroleum industry was one of the worst hit by Coronavirus, especially as it occurred during a crash in global crude oil price due to disagreements between major oil producing countries.
He said the global lockdown which followed the outbreak of the pandemic resulted in lower energy demand, which further affected the price of crude oil.
“It is a principal source of foreign exchange earnings and Foreign Direct Investments, ” Sarki said.
The DPR boss said the direct impact of falling oil prices had led to revising of the 2020 budget to N10.81 trillion and the budget bench mark from $57 per barrel to $28pb.
According to him, there is need for strategic and business repositioning which include more collaboration, good corporate governance and deployment of technology going forward.
“Contracting models need to change. Service providers need to come together and think of how to best use their facilities and share risks so that returns can be shared.
“This is the time we really need to emphasise on it, ” he said.
The Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Mr Mele Kyari, who was one of the lead discussants, said such collaboration and partnerships would help to reduce cost of production which was a major issue in the industry.
The NNPC boss reiterated the corporation’s commitment to reducing the cost of producing crude oil in Nigeria to $10pb by 2021, adding that engagements had already started toward actualising the target.
He also noted that improved gas production and business efficiency as well as curbing activities of oil pipeline vandals would help sustain the industry during these critical times.
Mr Bayo Ojulari, Managing Director, Shell Nigeria Exploration and Production Company, said reducing cost of operations in the industry required collaboration and policy incentives that encourage investments.
“It also requires for us to listen to each other to understand where the government is coming from and where the investor is coming from. So, collaboration is really important right now, “Ojulari said.
He said one of the major lessons from the COVID-19 pandemic was that there was need for oil and gas companies to do more for their host communities and also ensure safety of their personnel at all times.
Edited By: Chioma Ugboma/Oluwole Sogunle (NAN)
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