Fresh investments, renewables, technology, security urgent for growth

The need to adopt strategies that can advance the energy sector cannot be overemphasised. Major stakeholders such as the Major Oil Marketers Association of Nigeria (MOMAN); the Independent Petroleum Marketers Association (IPMAN) and the Centre for Economic Policy Analysis and Research (CEPAR) in separate interviews with New Telegraph suggested areas of consideration for the growth of the sector.


The Executive Secretary, MOMAN, Clement Isong, said Nigeria should be committed to the sustainability agenda. He also called for more investment and adoption of renewable energy. The major oil marketer also canvassed more application of automation in businesses. He said introduction of automation in transportation, fuel stations and depots will ensure efficiency, customer satisfaction, reduction of losses of product and growth of business. Isong said: “I think that the removal of the subsidy has offered Nigeria a great opportunity. It is an opportunity for us in the industry to focus on optimisation and efficiency. We should focus on, if there is no distortion in the market, you will see an acceleration of investments. Already investments are taking place, investments are coming online. “All that was the promise of the Petroleum Industry Act (PIA). So depending on how those who are dominant in the market play it, you will see more investment and more employment opportunities coming online, a greater efficiency coming into play and we must remember that the President had a very large team that went to COP28 in Dubai. So we are expecting from the regulator which has launched its sustainability initiative, adjustments in the oil industry as a whole as we begin to drive the sustainability agenda. “The sustainability agenda is not just for the rest of the world. It is for us as well. If you look at the sustainability goals, you will that if we adhere to them in Nigeria, if we use them as a benchmark for our developmental goals, it will only be good. It is a good benchmark and it is good for objective setting and for measuring the level of performance of different level of government, whether you are talking of LG, state or federal government level.

“All businesses must have their strategies with these sustainability goals in mind, knowing that it is not just government policy, but it is international world policy. So, we need to ask ourselves: what does this means for our businesses? For example, if transportation continues with diesel, it is bad for the environment, and also expensive because diesel is expensive. “So, transporters, truck drivers, distributors of petroleum products need to move in the first instance, to transportation using Compressed Natural Gas (CNG) trucks, because it is cheaper, burns cleaner; it is in line with the sustainability agenda of reducing greenhouse gases, and it is good for the environment; before we eventually arrive by transportation by pipelines. That will take a couple of years to achieve. These are strategies that you build.” He added: “You know that if we want to survive, we need to go away from diesel truck distribution towards cheaper means of transportation and eventually, the trucks on the road will reduce as we move to transporting products by pipeline. That is an example of a sustainability project that should earn Nigeria carbon credit point as we reduce the use of diesel. The same thing when you are talking about the reduction of diesel from power generation. We need to focus on moving to solar energy for instance. Many of my members have already introduced solar panels in their filling stations.” He disclosed that there was a company that has over 250 filling stations that run on solar. According to him, resort to solar energy saves a lot of costs, ensures costs optimisation, and also reduces environmental pollution.

He stated that this is going to be a key initiative that would drive everybody’s agenda going forward simply because it is important in optimizing and in becoming more efficient. He added that it is important in reducing cost and adds to contribution to sustaining the environment. He noted that the same thing with automation. He said introduction of automation in transportation, filling stations, and deports would reduce losses of product. According to him, reducing losses of products makes ones’ business more efficient and more competitive. He cautioned that if a marketer continues to lose products to theft along the route between the depots and ones’ stations or the marketer continues to lose products at his depots, the person will not be competitive and will soon be out of business. He advised that introduction of automation and use of metrics to run ones business are some of the benefits of the removal of the subsidy. He explained that what this does is that everybody who wants to stay in business has been taking a second look as how deregulation has impacted them. He also said local refining of petroleum products was greatly required in the year. For him, the commencement of refining by Dangote Refinery and the resumption of operations by the Port Harcourt Refining Company, Warri Refining & Petrochemicals Company Limited (WRPC) and the Kaduna Refining And Petrochemical Company (KRPC) would boost Nigeria’s economy and make the country become a refining hub in Africa. Isong said: “The Dangote refinery is ready. We are talking to them already. Production will soon start and we will soon be buying from them also. What does that means? It means that we have to re-look at our logistics and how we do business. The quality of the product is the highest quality that we are expecting so competition will move to another level. “So, the world is changing. The world of petroleum distribution is changing before our eyes. Some of our members are also introducing charging stations for electric vehicles. So electric vehicles have started coming into Nigeria. If we do not move the adjustments that are necessary, of these multiple energies, you then find that many people will be out of business. “So the world is changing and we need to prepare not just to prepare for that change, we need to drive that change because that change is good, it is good for the country, customers and business if you get your strategy right.”


The National Public Relations Officer of IPMAN, Chinedu Ukadike, called for the rehabilitation of pipelines and depots and lamented that the decay of the infrastructure had unleashed retrogression to the sector. He stated that the rehabilitation of the pipelines and depots would reduce long transportation, and the associated expenses in transporting petroleum products. He also opined that local refining was high desirable and would advance the sector and Nigeria’s economy in general. Ukadike said: “For 2024, I am see ing a very good prospect in the oil and gas distribution sector because we are believing based on information reaching us and our inspection in the Port Harcourt refinery that the Port Harcourt refinery is almost 95 per cent competed. They have done with Area . the port Harcourt refinery is coming up almost like a brand-new refinery. So we are sure that there will be massive output of petroleum product in the next year. “Although the FG said Port Harcourt should start producing, but I do not think it will be a reality. We are hopeful that by January or February, Port Harcourt, Dangote Refinery and also many other refineries will be able to find there feet in terms of distribution and Nigeria will start exporting production product, we will have enough for us to consume. Exportation of petroleum product will yield more foreign exchange. The economy will breathe again. “The major problem is that our pipelines are dilapidated. The security agencies have collapsed and lost hopes that they can do it. That is why FG employed Tantila that was owned by Tompolo to be able to man some of our pipelines and curb pipeline vandalisation, theft of crude oil in our nation and also to increase our output of crude.” He urged the FG to come up with state of emergency and give a matching order to the security agencies to ensure that the nation’s pipelines, both offshore and onshore are being protected. He explained that there were pipelines in System 2a, 2b and 2c. According to him, these pipelines are wired all over the country such even when petroleum product is being produced in River State or Port Harcourt Refinery, it can pump up to Yola. He stated that that is how it was designed. “The other side from Musomi, the Western side to Ilorin depot, that is how they prepare the pipelines. But now we have lost the pipelines and the FG is not doing anything. What they are doing on the refineries, there should commence work on the pipelines so that they will save our roads and also save our vehicles. “Marketers should not go more than 200 or 100 Km to be able to source their products. For marketers to go more than 500 km is not good. That is why we are incurring so much losses and prices of petroleum product is skyrocketing,” Ukadike said.


Director, CEPAR, Prof. Ndubuisi Nwokoma, urged the government to focus on energy efficiency, which he said, would transform all sectors of Nigeria. He also said Nigeria should get out of dependence on foreign countries for energy supplies. Nwokoma, a professor of financial economics, urged the government to attract more foreign direct investments, adding that it was needful to create friendly environment for business to germinate and grow. Nwokoma said: “Government should focus on energy sufficiency. I think this is very critical. In all areas, whether we are talking about electrical energy or fuel or renewables, oil products, downstream, up stream, or midstream. So government will definitely make sure that the country has energy sufficiency. That basically is what it should focus on. We talk about that the refineries have to work. And they make sure that whatever stories about Port Harcourt Refinery or Dangote should work.” He also urged the government to focus on enhancing energy sufficiency even as he stated that gas is expensive now. He advised that the government should adopt energy mix in addressing power insufficiency. The don also advised that strategies should be focused on renewable energies. He noted that basically, Nigerians were depending more on fossil fuel. He said: “I think the critical issue is that the government should work towards making the country energy sufficient. We cannot refine and we are always importing. There are many variables, they should just work towards making sure that the country has energy sufficiency for us to run the economy. That is very critical. “Whatever they have to do, let them make sure that we have energy sufficiency. If Port Harcourt Refinery and Dangote refinery will do it, or if other ones need to work, whatever they have to do, they should put in place policies that Port Harcourt should work, Dangote should work, other ones should work. We should try to get out of dependence on foreign countries for energy supplies. Let us not continue to have problem of energy insufficiency. Even gas, we should have a programme covering all the areas to have energy sufficiency. I think that should be a good direction to follow.”

He added: “Government should also make concerted efforts to attract foreign investors but for any transaction, you look at what you will gain. Those coming in will also look at the environment and what is the needs for them. There is no free lunch when it comes to investment. You are looking at what you can get out it. Government can only ask, if you ask and ask and those people do not see anything there, they will not come. “They will just pay lip service. We have been having these discussions and many of them have no materialized. So, whoever that is coming will look at other things and make up his or her mind whether to come or not. But there is nothing wrong in making effort to invite. “Government should make the environment friendly for them to invest. Those who are coming will look for those variables, if you want investment, you make the environment attractive. “The recapitalisation will accompany plans to make electricity tariffs cost-reflective, which will improve the liquidity and viability of the power sector.”


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