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Indigenous service providers project $7bn capital to raise Nigeria’s oil, gas output by 50%
Indigenous oil and gas service companies in the country, the Petroleum Technology Association of Nigeria (PETAN), has projected that the sector will need about $7 billion in capital expenditure on equipment over the next four years to help raise the country’s crude oil production from 1.5 million barrels per day (bpd) to three million bpd by 2030.
Chairman of PETAN and Chief Executive Officer of Geoplex, Wole Ogunsanya, who made the projection during the PETAN Original Equipment Manufacturers (OEMs) Investment Forum at the Offshore Technology Conference (OTC) in Houston, Texas, United States, Thursday, stressed that $1.8 billion was needed every year on equipment to catch up between now and the 2030 target, in order to increase production to three million barrels per day.
The session, themed: “Strengthening OEM Partnerships for Local Content Growth,” gathered Nigerian service providers and global equipment manufacturers to explore technology transfer and collaboration opportunities.
“If you do the maths, that’s a 50 per cent gap from where we need to be. We need to spend $1.8 billion every year on equipment to catch up between now and the 2030 target, to increase production to three million barrels.
“Even if I discount that, we’re looking at about $7 billion spent in the next four years just on equipment.
“We’re always looking for technology. If you have the best technology in the world, we have the funding to do it, we have the human capital to deploy them.
“We’re trying to raise oil and gas production in Nigeria from where it is — 1.5 million barrels per day, to 3 million barrels because we have the refineries to process them,” Ogunsanya said.
According to him, the push was driven by Nigeria’s refining ambitions and the need to produce competitively.
Ogunsanya revealed that PETAN members currently generated between $5 billion and $6 billion in annual revenue within Nigeria’s petroleum industry, while restating that local content did not mean lower standards, explaining that PETAN companies are delivering services at the same quality level as international contractors.
“With the right technology, Nigerian service firms would still produce oil and gas at the same service quality as anywhere in the world, such as in Aberdeen, Middle East, and in the United States,” stated the PETAN chairman.
