Chairman of UBA Group, Mr Tony Elumelu, CFR, yesterday at Transcorp Hilton Abuja, advocated various reforms to achieve the goals of Project one million barrel of oil production per day (MMBOPD).
These reforms, according to the banking icon who is also the Chairman of Heirs Holdings Oil and Gas include the enhancement of security architecture in the oil sector, the streamlining of regulations, the need to attract additional investment and the adoption of the right technology.
Mr Elumelu who stated this while presenting his key note address titled: Transformation, Innovation & Excellence
at the launch of Project noted that these are a crucial part of the solution to unlocking the next phase of the nation’s development in the oil sector.
Whilst advocating for the implementation of advanced technologies and community engagement strategies to secure assets in the sector, the banking guru and reformist insisted that the Nigerian Upstream Petroleum Regulatory Commission
(NUPRC) must remain committed to creating a more transparent and efficient regulatory environment.
He also advised on the need to embrace cutting-edge technologies to optimize production and reduce environmental impact and leverage on the improved landscape to attract both domestic and foreign investment
By addressing these areas comprehensively, Mr. Elumelu noted that the oil sector will not only aim to reach the 1MMBOPD target but also create a sustainable framework for future growth.
The erudite banker who highlighted the challenges in the sector to include aging infrastructure, security challenges in the Niger Delta, stalled investments, regulatory uncertainties, and a global shift towards renewable energy that has compounded the investment challenge, noted that the theme of the event, “Transformation, Innovation & Excellence,” resonates deeply with the challenges and opportunities facing Nigeria’s energy space.
He, however, expressed his worry on the gradual slide in the nation’s oil production and the implications.
His words: “We must acknowledge the elephant in the room. Nigeria’s oil production has been on a downward trajectory, falling from peaks of over 2 million barrels per day to recent lows, below 1.5 million.
“This decline translates to lost revenues, reduced global market share, and missed opportunities for national development”.
The root causes, according to him, include aging infrastructure, security challenges in the Niger Delta, stalled investments, regulatory uncertainties, and a global shift towards renewable energy that has compounded the investment challenge.
These factors, according to him, are threats to the foundation of the Nigerian economy, as the nation is heavily dependent on oil. “As a nation, we cannot permit this to continue, and squander our inheritance and betray our next generation”, he opined.
While commending the transformative and bold initiative of NUPRC: the Project 1 million barrel of oil (MMBOPD) and its leadership, for the momentous occasion, Mr. Elumelu described the project as a crucial part of the solution to unlocking the next phase of the nation’s development.
He said further: “By targeting to grow production by 1 million barrels of oil per day from current levels, we are setting a clear and challenging goal; one that I believe is achievable as I see all stakeholders are at the table and will commit to play their parts and bring the needed collaboration, innovation, and excellence to make this project a success, for the benefit of our country.
“To be sustainable, this initiative should go beyond just increasing production; it should catalyse a comprehensive strategy to revitalize our entire upstream sector”.
As the sector operators embark on what he described as ambitious project to boost oil production, he spoke on the need to also focus on the critical role of gas in our energy mix.
He noted that the “path to 1MMBOPD must be constructed on strategies that maximize the value of our gas resources, reducing flaring and increasing utilization for domestic and export markets”.
This dual focus, according to him, will help diversify the nation’s energy portfolio and mitigate the risks associated with over-reliance on oil.
He said further: “We know the criticality of gas in improving access to electricity in Nigeria. Access to electricity is the single most important factor in our quest for industrialisation. You can now see that our oil and gas sector is pivotal to the development of our country”
While commending the NUPRC for its achievements so far, Mr. Elumelu noted that it’s efforts in promoting sustainable practices, such as the Nigerian Gas Flare
Commercialisation Programme, exemplify the innovation required to balance environmental stewardship with economic growth.
The UBA Group Chairman who noted that
NUPRC has already laid the groundwork for this solution in its three short years, explained that these initiatives will not only reduce “our carbon footprint, but also create valuable opportunities for our workforce and communities”.
Speaking on the roles of Heirs Energies’ and the Progress made so far, the oil
Magnate said: “In the first 100 days after we took over operational control of our OML-17 asset in 2021, we doubled our production from 28,000 to over 50,000 barrels per day.
“ From a low of 5% terminal receipts in December 2021, year-to-date in 2024, we have recorded an average terminal receipt of 85%; a remarkable improvement and a good example of what a purposeful collaboration between NNPCL and operators underpinned by rigorous execution can deliver.
“With the improvement in the operating environment, we have restarted our investment and production growth journey, and have now successfully reversed the fall in production that we suffered in 2022 and 2023, as a consequence of the evacuation challenges. A few days ago, OML-17 attained over 51,000 barrels per day, and we continue our production growth journey.
“Relatedly, we are also working to grow our gas production that feeds many power generation plants and gas-based industries”.
These achievements, according to him, “indicate what is possible, where there is a strong industry collaboration, and in particular, when regulatory support meets private sector drive and innovation”
As Heirs Energies provides the sectorial expertise needed to transform our oil and gas sector, he noted that UBA Group has long remained a committed funding institution on this journey of transformation.
His words: “As a global financial institution, UBA, positioned not just across Africa, but in New York, in London, in Dubai and in Paris, has been committed to providing the necessary funding and financial expertise to support both established players and emerging indigenous companies in reaching our collective goals and implementing the solutions we have outlined”.
In his closing remarks, the banking mogul said: From my experience in other sectors that Heirs Holdings Group plays in, I can say that no sector developes without a strong regulatory environment and institution.
“This is why I must commend President Bola Ahmed Tinubu, GCFR, for his steadfast support and commitment to strengthening NUPRC as the oil sector regulator – This is much needed if we must achieve the total transformation of the Nigerian oil and gas sector.
“Together, we can build an energy sector that not only meets Nigeria’s needs but also positions us as a leader in Africa’s energy transition”.
