The Special Adviser to the President on Energy, Olu Verheijen has urged investors to seize new opportunities in Nigeria’s energy sector, highlighting untapped potential and recent reforms to attract capital.
This is as it emerged that International Oil Companies (IOCs) operating in Nigeria have committed more than $82 billion in deepwater investments in other countries that they have deemed to be more attractive destinations for their capital.
Speaking to a diverse audience, at the ongoing African Energy Week in Cape Town, South Africa, she underscored the untapped potential within the industry and discussed the recent reforms implemented by the President Bola Tinubu administration to attract investment.
Verheijen noted that the country has historically underperformed in oil and gas production despite Nigeria’s wealth in the oil and gas industry.
She referenced how countries like Brazil that has only 30% of Nigeria’s oil reserves has outperformed by producing 131% more than current production of Nigeria.
“Despite our abundant endowments, we have underperformed against our potential. For example, Brazil holds only 30% of Nigeria’s oil reserves but produces 131% more. This is largely due to under-investment,” she said.
She said that since 2016, Nigeria has attracted only 4% of African oil and gas investments, while investment has surged in other, less resource-rich nations.
“Since 2016, Nigeria has managed to attract only 4 percent of total investments in oil and gas, while less resourced countries in Africa have enjoyed a bigger share.
“When we analyzed investment data, we also found that, between 2013, when Nigeria’s last deepwater project reached FID, and now, IOCs operating in Nigeria have committed more than $82 billion in deepwater investments in other countries that they have deemed to be more attractive destinations for their capital.”
Recognizing this trend, the presidential aide highlighted many efforts by President Tinubu’s administration to enact reforms aimed at reshaping Nigeria’s investment landscape.
Among these initiatives, she said the government has introduced fiscal incentives targeting deep offshore and non-associated gas projects, marking the first time Nigeria has outlined a fiscal framework specifically for deepwater gas.
In efforts to enhance the upstream Oil and Gas sector, she said her office has collaborated closely with the office of the National Security Adviser to create and distribute focused Security Directives, leveraging insights garnered from on-ground operators.
Additionally, Verheijen revealed steps to streamline approval processes by clearly defining the regulatory scopes involved.
This initiative, she said, aims to significantly reduce the extended project timelines that have historically plagued the industry, as well as the high-cost premiums associated with operating in Nigeria.
