Following the 2015 crash in oil prices; considerable positive actions have been put in place to bolster the sector. Specifically the Organization of Petroleum Exporting Countries (OPEC) member states agreement to freeze production between major oil producers late 2016, the deal was later extended through to December 2018 and has resulted in a steady increase in oil prices to date.
This and other topical oil and gas issues were discussed at the recently concluded 7th OPEC International Seminar themed: ‘Petroleum – Cooperation for a Sustainable Future ’in Vienna, Austria
Nigeria’s leading indigenous oil and gas company Oando PLC was a gold sponsor of the prestigious event, attended by over 800 key sector players and decision makers. The group chief executive of Oando, Adewale Tinubu, led a Nigerian delegation to the event where he shared the Nigerian perspective in a panel session on the topic: ‘Global Oil Future Challenges.’
The panel moderated by CNN’s John Defterios included other IOCs and business leaders such as; Amin H. Nasser, president and CEO, Saudi Aramco; Daniel Yergin, Vice chairman, IHS Markit; John Hess, CEO, Hess Corporation; Andrew Gould, former CEO, Schlumberger; Sergey Vakulenko, head, Strategy and Innovations, Gazprom Neft; Jay R. Pryor, Vice President, Business Development, Chevron.
The session focused on current and future challenges specific to the oil industry in the medium to long term, including challenges related to the current global supply/demand balance and the impacts of the energy policy and technology on the future of oil supply and demand.
Speaking on future global oil challenges, Adewale Tinubu said: “Without a doubt there has been a lot of market disruption. However, the good thing is that OPEC has focused on balancing the market as opposed to pricing; because price is a variable that no one can confidently say where it will end up.
He further said “The world is likely to experience larger oil deficits than expected if US barrels do not increase and the demand out of Asia and Africa continues to rise.”
Speaking on the impact of investment on global supply, president and CEO, Saudi ARAMCO, Amin H. Nasser, said:“In the rest of the world there has been a big drop in investment which will impact future supply. Now we see the trend picking up a little bit, as shown by the chart, but I don’t think this is enough to meet future global supply.”
Also present at the event was Nigeria’s minister of State for Petroleum, Dr Emmanuel Ibe Kachikwu. He led a panel on ‘Energy Cooperation’ in the company of other industry regulators and leaders from India, Iran and Abu Dhabi. He said: “Cooperation and sustainability for us in Nigeria is about humanity. Humanity must come to play in the decisions we make, and for us in developing countries, we need to ensure that those who host assets in their communities are better taken care of. Whilst we are focused on the short term challenges within the oil and gas industry, we must fight against the long term challenges in developing countries such as the fact that our asset hosts are living way below the poverty line. As OPEC is being persuaded to shift pricing, it should take into consideration the economic development of developing countries who depend heavily on oil as a primary resource.”
Oando’s participation at the event further reinforces its position as the preferred indigenous oil and gas company in the country. The company has truly carved a niche for itself as a truly independent indigenous oil and gas company flying the Nigerian flag at global events that shape the future of the sector and the world in general. Events such as the World Economic Forum (WEF) in Davos, CERA in Houston and the Africa CEO Forum, to name but a few. At these events, Oando has engaged in open and transparent dialogue with a broad range of stakeholders to analyze and proffer solutions to global issues.
The company was propelled to the ranks of IOCs following its 2014 game-changing acquisition of ConocoPhillips Nigeria which saw its production levels catapult from 4,500boe per day to an average of 50,000boe per day. In the same vein, the company was the first private company to enter gas distribution in Nigeria when it pioneered gas distribution in the Greater Lagos area with the aim of spurring industrialization.
Speaking on the prospect for investors in Africa, Adewale Tinubu said: “Africa offers a fantastic resource base, an untapped resource base, where the production to reserve ratio is very low. With increased investment, particularly with National Oil Companies (NOC) stepping forward to realize the position they play in driving production, the likes of NNPC can raise substantial sums in the international market and convert some of these reserves into production.”
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