Nigeria’s oil sector needs an energy bank to enable it to have easy access to funding and enhance the capacity development of indigenous oil companies, the Nigerian Association of Petroleum Explorationists, NAPE, said.
Espousing the position of NAPE at a media parley in Lagos, the President, Mrs. Patricia Ochogbu stated that an energy bank with a lower interest rates would put operators on a better pedestal to execute the numerous projects begging for funds.
Her proposal is coming on the heel of the drop in investments in the sector, owing to the non-availability of funds. She urged the government to consider an energy bank for the interest of the oil industry and the economy in general.
She said, “Where government can come in is to make sure that there is funding, that is the advantage that an IOC has over a marginal field operator.
“We strongly advocate that the government puts something like an energy fund or an energy bank like we have a bank of the industry so that funds could be made available to people who want to work.
“It is not the kind of loan you get in the bank now at over 20 per cent interest and you cannot get it for more than five years.
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“If you listened to First E&P story, they worked for almost eight years before they sold their oil. But you know, if you go to the bank to get a loan, even a mortgage, you can’t get it. If the government can do that, that would help a lot.
“What I can say to the government is that they should create an enabling environment. One of the things that people don’t talk so much about is the amount of taxes. There is multi-level taxation that this industry faces. As you are looking for funding to do this, you know that the federal government will take, the state governments will take, and councils will take, even in your operating community.
“Government can help us in that area, like streamlining the taxes and making the environment friendly. Many people have ideas, and many people have what it takes to make something happen in the industry, but if they don’t have access to funds or if a big chunk of the fund will go into non-production type cost, then it becomes a problem. Although I will say that the government doesn’t have money but they can create policies, they can look at taxes and just make things a bit easier for the industry,” Ochogbu stated.
Also speaking on the issue of the energy transition as it affects Nigeria, the NAPE President stated that it was long expected as nothing is constant in life. She, however, allayed the fears making the rounds that petroleum products would no more be relevant in no distant future.
According to her, “Other countries are talking about renewables but what they are not telling us is the environmental cost and the other hidden costs that we do not know yet, because right now, we see that electrical vehicles, is still starting.”