The Federal Government and the African Petroleum Producers Organisation on Monday stated that it was worrisome to note that a lot of investors were finding it difficult to invest in oil exploration in Nigeria and other countries on the continent despite the increasing oil finds.
According to the government and APPO, African countries have no option but to unite and grow the continent’s oil sector in order to effectively mitigate the adverse effect of the recent development in Africa.
This was disclosed at the extraordinary session of the Council of Ministers of APPO in Abuja, where Nigeria’s Minister of State for Petroleum Resources, Ibe Kachikwu, emerged the president of the organisation.
Vice President Yemi Osinbajo, who declared the ceremony open, thanked the organisation for unanimously agreeing to place the responsibility for leading APPO’s reform process on Kachikwu, noting that the minister had since March 2016 remained at the centre of the reform efforts in the Nigerian oil and gas industry.
On the difficulty associated with investing in oil exploration on the continent, the new APPO president stated that the realities all over Africa showed that there had been a lot of new finds of oil but less number of investors.
He observed that everyone in Africa was enthused by the possibility of further harnessing new natural resources that would be used to develop the continent, but getting funding for this had been difficult.
Kachikwu stated, “The reality also is that finding the necessary finance for this is very difficult. Increasingly, with what had happened, especially with the tumbling of oil prices over the last few years – nice that is has begun to come up – a lot of investors found it difficult to invest, not just in oil exploration activities, but in fact, even worse still, oil exploration activities in Africa.
“The only way growth will happen in this sector in the whole of Africa is through an inter-dependence approach. All of us must be able to hold hands and find a way of supporting one another in terms of the research, internal investments potential and capabilities, and also help to drive the process.
“But more fundamentally, it must be in a position to have a lot of best learning from some of the three or four major producer countries that have been in this for quite a long time, as the new ones are coming on board.”
Osinbajo, in his remarks, noted that the oil and gas industry was capital intensive, stressing that “as individual countries, we often do not have the resources required to make the necessary investments in the industry.”
“This is especially true, because these investments are competing with infrastructure and social services for the limited resources available to us as government.
“By serving as a platform for increased collaboration and cooperation among member countries, APPO will go a long way towards helping overcome these financial challenges,” he added.