For Nigeria the drop in crude oil production has never been this rife in Nigeria.Â
Over the years, crude oil has become the major contributor to Nigeria’s GDP.
However, the nation, has not been able to meet up with its production quota in recent times due to various challenges.
Nigeria has been very active in the exploitation and exploration of oil and gas.
It has been the major source of revenue and contributes over 90% on yearly basis.
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There is no doubt that the Nigerian oil and gas industry is plagued with lots and lots of problems.
Some of these problems are caused by government owned agencies in the industry.
Others are the handiwork of major industry players who are deeply involved in the malaise.
This article examines some of the problems confronting the oil and gas industry.
Below are some of the highlighted challenges.
Challenges Affecting Crude Oil ProductionÂ
1. Pipeline vandalism
The rate at which vandals attack the nation crude oil pipelines, and on a regular basis, makes it impossible to achieve optimal production.
This has continued to affect what is generated from crude oil production.
2. Corruption
Sharp corrupt practices among government officials who circumvent the process is another major challenge.
Greed, selfishness and lack of morality are some of the vices causing corruption to fester.
In fact, corruption is so bad in Nigeria, that even security officers allegedly partner with vandals and corrupt officials.
3. Obsolete laws and regulationsÂ
The laws and regulations guiding operators in the oil and gas industry are out of date and needs to be rejigged.
Updating laws and regulations in place would yield better results and help players play right.
4. Volatility Of Oil PriceÂ
Another factor is the fluctuating price of oil around the world.
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5. Lack of funding
There is need for adequate government funding to help boost the morale of industry players.
Government has a role to play in funding and creating a level playing ground for all.
Recommendation
We recommend that for industry to attain global standard, there must be a surgical operation in the oil and gas industry.
