Lokpobiri urges oil firms to fast-track investment decisions

The Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, has urged oil and gas companies to shorten the period required to reach Final Investment Decisions on projects, saying Nigeria needs to move more quickly from discoveries to actual production.

Lokpobiri made the call on Wednesday in Abuja at the Final Investment Decision signing ceremony for the Ima Gas Project, jointly developed by Nigerian independent AMNI International and TotalEnergies.

His appeal comes as the $800m Ima project moves into development more than five decades after the gas field was discovered in 1973.

The project, located on OMLs 112 and 117 offshore near Bonny Island, Rivers State, is expected to commence production in 2028. TotalEnergies, which operates the project with a 40 per cent interest, said the field would reach a plateau of 350 million standard cubic feet of gas per day and supply about one-third of the gas required for the ongoing Nigeria LNG Train 7 expansion.

Speaking during his ministerial address at the ceremony, Lokpobiri said the long period required to bring projects to FID remained an issue that the industry needed to address.

He said, “Let me also, you know, take the opportunity to say that, look, you are the experts. And I believe that if you can take FIDs within a shorter period, it will be better for the industry. I don’t see the reason why it would take you years to be able to get to FID.

“This partnership, from what you said, took over two years, from the handshake, you know, in Houston, now over two years.

I believe that going forward, I appeal to the industry that let’s try and see how we can negotiate these FIDs within a shorter period, you know, so that we can also, you know, get FIDs within a shorter period. These things are doable.”

The minister said faster investment decisions would allow Nigeria to witness more project launches and accelerate the conversion of its oil and gas resources into productive assets.

“Right now, we are talking about maybe taking FID, and I’m going to mention the company, taking FID within six months. One company, you know, came to Nigeria. They had the privilege of meeting with Mr President, and they made a commitment to Mr President to say, look, if you give us all the support, we’ll take FID within October and November, which would be unprecedented.

“And I’m saying that, look, let us adopt that template, so that going forward, let FIDs be taken within a shorter period, so we can get to be witnessing ceremonies like this for the benefit of, you know, not just Nigeria, but, you know, the entire, you know, entire world.”

Lokpobiri also attributed the improvement in investment activity to reforms introduced by President Bola Tinubu’s administration, particularly measures aimed at providing greater fiscal and regulatory certainty.

He recalled that Nigeria had struggled to attract major oil and gas investments for years before the current administration, citing comments previously made by TotalEnergies’ global chief executive.

“Recall that when this government came in 2023, there was an investment for 10 years or more. And incidentally, the global CEO of TOTAL went to Rwanda and said, you see, the reason why Nigeria didn’t have an investment for 10 years is because of lack of clarity; there was no regulatory clarity, there was no fiscal clarity, there was no stability.

“This President’s new vision provided an environment, you know, for the global community to now know that Nigeria has now a stable fiscal, stable regulatory environment, relying on the PIA for people to, you know, have the kind of confidence that is needed to invest in the oil and gas industry,” he said.

• TotalEnergies, AMNI approve $800m Ima Gas project
• Lokpobiri seeks faster investment decisions, says delays hurt oil, gas sector
• Tinubu hails $800m investment decision on 50-year-old Ima gas project

The minister said Nigerian banks also had an important role to play in financing new projects, particularly as international investors reassess energy investments.

He urged domestic financial institutions to continue supporting the sector, arguing that oil and gas would remain important to the global energy mix. “I can tell you, guys, today that, look, for the next 50, 100 years, oil and gas will still be the dominant source of global energy,” Lokpobiri said.

Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, who addressed the ceremony virtually, described the Ima FID as a vote of confidence in Nigeria’s gas sector.

He said the Government’s Decade of Gas initiative was designed to use natural gas to support power generation, manufacturing, fertiliser production, petrochemicals, transportation and clean cooking.

“With this development today and the expectation of the first gas in 2028, the push towards the target of Mr President of 12 BCE by 2030 is assured,” Ekpo said.

Special Adviser to the President on Energy, Olu Verheijen, said the significance of the Ima development went beyond the volume of gas expected from the field. Verheijen said the project illustrated the importance of creating conditions that allow natural resources to be converted into investment, production, jobs and higher incomes.

She said, “Resources do not create prosperity. A country can possess enormous natural wealth as we do and still struggle to convert it into investment, industries, jobs, and higher incomes.

“What matters is whether we create the conditions that allow capital, technology, and enterprise to turn these resources into productive economic activity, which is sort of the beginning of this journey today.”

Verheijen said Ima was the fourth gas project to reach FID under the current administration, adding that its impact would be measured by the economic activity generated by the gas.

“The results are now visible. And that is significant. Today’s decision represents the fourth gas FID that we’ve taken. The fourth in two years. At its peak, IMA is going to deliver approximately 300 million scf of gas, and a third of an energy 27 supply, as Mathieu mentioned. But behind all of those numbers are people.

“A manufacturer that may be able to produce more competitively and therefore hire more people. A business that’s able to expand and therefore hire more people. A young Nigerian who gets hired and then acquires a new skill and earns an income,” she added.

TotalEnergies said Ima would be developed through a single offshore platform connected by a 22-kilometre pipeline to Nigeria LNG. The project is designed with power supplied from shore, no flaring and permanent methane monitoring. About 60 per cent of the workforce during development is expected to come from host communities.