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| Wale Tinubu, CEO, Oando Plc |
The Group Managing Director and
Chief Executive Officer of Oando Plc, Mr. Wale Tinubu, addressed the ADIPEC Conference, held in Abu Dhabi a few days ago, on the
challenges and opportunities facing the Nigerian oil and gas industry.
Mr. Tinubu opened
his address to a panel discussion on the resilience of oil and gas with a
global perspective, discussing the importance of meeting COP 21 climate change
commitments while meeting energy demands, particularly in the developing
countries of Africa and Asia with a growing middle class. Additionally, he
emphasised the importance of focusing on petrochemical development, increased
refining capacity and playing a role in industrialisation.
"Is
this the new norm? Fifty dollars a barrel for crude?" he
asked the conference, adding that it is important to "ensure we drive the
supply in a more efficient manner".
"We
will have a soft market for a long time," Mr. Tinubu said. "Cost
reductions are appropriate for a company to ensure a good return."
He
described Africa as "without a doubt an exciting prospect", with 7.6
per cent of global gas resources and particularly promising gas prospects in
Mozambique and Tanzania, oil in Uganda, and oil and gas in Nigeria.
Mr.
Tinubu added that there is an opportunity for Africa in terms of boosting
production of refined products, moving away from being a net importer of crude
oil, and becoming an exporter instead.
High
capex poses a challenge to African operators, according to Mr Tinubu, citing
costs in Angola of $36.20 per barrel and $35.40 per barrel in Nigeria. Other
challenges for Africa that Mr. Tinubu highlighted include a drop in rig counts,
project delays and cancellations, and a decline in export revenue.
In
regard to increasing the role of renewables in the energy mix, Mr. Tinubu said
that alternative forms of energy are "not able to provide the speed we
need to satisfy global demand" and that "renewables are not receiving
the attention they should be receiving".
He
then focused on Nigeria in particular, saying that operators need to "turn
challenges into opportunities."
Mr.
Tinubu said that positives for the Nigerian oil and gas industry include
providing customised security solutions, the government is restructuring the
Petroleum Industry Bill, and joint venture budgets have been finalised for
2017. "Indigenous companies [such as Oando] will focus on areas
multinationals avoided," said Mr. Tinubu.
During
the question and answer session, Mr. Tinubu was asked about the challenges faced
by the Nigerian oil and gas industry for expansion. "The
best thing Nigeria can do is create a strong NOC," he
said, with "improved transparency" and using resources to raise
capital as the priorities.
"[Oando]
had a torturous time [but we have built] a successful export business and we
have 500-strong petrol stations, and big upstream production," Mr.
Tinubu said. Leveraging new technology and cost efficiencies were flagged up as
being important to continue to expand.
"I
think the worst is over, we are going to be ever-present," he
said in his closing remarks. (Oil Review Africa)
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