Minister of state for Petroleum Resources, Dr. Ibe Kachikwu Monday in Lagos lamented that Nigeria and some countries lost $300 billion in oil investments globally in three years, due to the decline in oil price.
The minister said on the Nigerian side, the loss of these investments was due to inefficiency in the country’s security policy and inconsistency in policies
Kachikwu who made this known at the 2017 Society of Petroleum Engineers (SPE), Nigeria Annual International Conference, also said that Nigeria need to make urgent decision “for our oil sector to survive an imminent global shift. As some countries were already moving away from oil because oil life span will expire in 25 years.
“Electric motors are taking over globally. In the next 20 to 25 years, oil lifespan will expire, so we just need only five years to make a change of policy in the sector. We must make a traumatic decision for the oil sector to survive the innovation”.
According to Kachikwu, investors prefer to invest the limited resources elsewhere in African countries; so what we are losing, other countries in Africa are gaining.
“The situation is very challenging when it comes to losing opportunities arising from investment.
“For the first time in the oil sector, the decline in the oil price resulted into loss of jobs. Infrastructural gap is another factor which the decline in the price created. We have an infrastructural gap deficit of $50 billion because government was responsible for infrastructure and we did not engage the private sector.
“The whole idea of the new petroleum policy is to move the private sector into financing part of the projects, because Government cannot do it alone,’’ he said.
The minister said the boom and burst had become a way of life in the oil and gas sector.
“I think we have had about five circles of boom and burst over the last 35 years and each time, we begin as if we did not expect it. The boom and burst has become the nature of oil and we should not be surprised anymore. Over 80 per cent decline in world oil price was recorded between 2014 and 2016 with oil price falling between $25 per barrel.
“All the same, we have managed through the principles of OPEC, to keep the price going between $45 and $50 per barrel.
“For now, our expectations between the year 2017 and 2018, is to keep the price at $60 per barrel,’’ he said