The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, while speaking in Vienna during the 173rd meeting of OPEC countries, talked about the government’s plans for the oil and gas sector in 2018, indicating that the development of gas would take a priority position in its itinerary for the industry, THISDAY reports.
He explained that: “We have our eyes on gas, and have passed the gas policy at the FEC. We just passed the gas commercialisation programme, we are focused very heavily on gas. We are also now trying to under our fiscal policy provide an incentive enough to be able to produce gas as of right, not gas as associated because every gas we have in Nigeria today is associated gas, in other words, people go to the upstream numbers and charge the cost of producing the gas to the cost of producing the oil, and so at the end of the day you are basically providing 100 per cent incentives and people would be lazy.”
“Now, we are saying gas is a different ball game – these are the terms and incentives for gas, don’t charge it to oil production and that will immediately take off $3-4 off the cost, but focus you on how you can explore for gas. There is only so much you can push for with regulation at the end of the day and that is why we need to work with the assembly. The infrastructure needed in the oil and gas sector is in excess of $30 billion, it is not going to ever be done by the government and that is the reality. We need to provide enough fiscal structures, enough tariffing incentives for people to come in and invest in these infrastructures,” he added.