Experts say FG’s earnings from crude oil to diminish soon
They made the assertion in their presentations at the ongoing Society of Petroleum Engineers Conference and Exhibitions in Lagos which began on Wednesday.
The News Agency of Nigeria reports that their projections were based on limited demands for crude oil amid subsisting free-fall in the international price of crude oil.
The theme of the conference is “Natural Gas Development and Exploitation in an Emerging Economy, Strategies, Infrastructure and Policy Framework”.
Prof. Omowumi Iledare of the Department of Petroleum Economics, Louisiana State University, U.S., said the price behaviour was related to the supply and demand in the world oil market.
He urged Nigerians to think of higher domestic consumption and show fiscal responsibility.
Iledare said the country needed petroleum assets domestication that would assist local investors to diversify and grow the economy.
On the subsidy issue, he said that one could not regulate an economic product unless it was a regular monopoly.
He also urged the government to create a conductive atmosphere for new investments in establishment of modern refineries across the nation.
“If government is interested in giving employment to the younger generation, it can invest by creating a royalty subvention.
“They may have a tax holiday for investors who are interested in building refineries for a justified cause.
“At this juncture, there is nothing any investor can do without government participation in the sector, that is why it is important for the legislature to pass the Petroleum Industry Bill,’’ he said.
Mr Clay Neff, Chairman and Managing Director, Chevron Nigeria Ltd., said the present crude oil price posed a serious challenge for the stakeholder to look beyond oil.
Neff urged the nation to reposition its activities and stimulate competition in the nation’s oil and gas sector.
He said the federal government’s exploration of the other mineral resources would expand the nation’s income stream.
Mr Austin Avuru, Managing Director, Seplat Petroleum Development Company Plc., said that there was need for collaboration between the International Oil Companies (IOC) and the government to achieve desired results.
“The new government is opened and is inviting experts in the sector for dialogue and we believe that with the collaboration of IOCs and the government the sector will continue to progress,’’ he said.