Nigerian Upstream Petroleum Regulatory Commission, NUPRC, yesterday, said it is working to ensure collaboration with industry regulators and stakeholders to attract businesses in the sector amidst divestment. The agency said it was implementing the Upstream Asset Divestment Framework to guide the seamlessly non-destructive exit of divesting entities and promote sustainable operation for the acquiring parties. The Commission Chief Executive, Gbenga Komolafe who disclosed this during the Nigeria Annual International Conference and Exhibition (NAICE), 2024, in Lagos, said this is all in the overriding national interest.Speaking on the theme of the event – Petroleum Industry Value Chain Optimisation: The Inevitability of Midstream and Downstream Development – Komolafe, who was represented by Mr. Enorense Amadasu, Executive Commissioner, Development and Production, NUPRC, said the commission was pursuing collaboration with sister agencies like the NMDPRA, and other key stakeholders to deepen end-to-end value in critical areas of operations.
To ensure robust development of oil and gas midstream operations, Komolafe said the commission would strengthen alignments on the administration of the Domestic Crude Supply Obligation and the Domestic Gas Delivery Obligation to grow the sector consistently with the provisions of the Petroleum Industry Act (PIA).
He said: “We are committed to entrenching collaboration for enhanced value to the industry and the nation at large, as we deliberate on the strategies and innovative approaches that will prepare the industry forward, let us remember that the optimisation of the midstream and downstream segments is not merely an option but inevitability. “By focusing on this area, we can mitigate the risks associated with market volatility, enhance the refining capacities, and ensure a more stable and efficient energy security for our nation in the world undergoing change. No matter what individual views may be, the world is on the energy transition course, hence, dividend of the in-country value from the oil and gas resources via a midstream and a downstream operation is highly imperative’.”
Komolafe insisted that concrete steps towards upstream decarbonisation must be taken whilst creating the structures that allowed midstream operations to strive and diversify the nation’s economic base. He disclosed the Commission had made deliberate and conscious efforts to position the upstream appropriately through the implementation of the ongoing regulatory framework for upstream decarbonisation and carbon monetisation in Nigeria.
He noted that the Commission is championing decarbonisation initiatives to sustain and grow investments in upstream oil and gas while ensuring environmental, social, and governance principles.
Komolafe, added that the commission would rally the continent’s oil and gas regulators towards the harmonised position to deepen value across the value chain for Africa’s important oil and gas resources. On his part, Group Chief Executive Officer, NNPC Limited, Mele Kyari, said the NNPCL was putting in place the entire required infrastructure needed to deepen domestic gas utilisation. According to Kyari, the obligation for domestic gas supply and also domestic supply of crude oil into the country is by no means designed to make sure that things worked for the industry. He insisted there must be a robust midstream and downstream in the country for this to happen. He said the NNPCL was making every effort to make sure that the refineries owned by energy were coming to operation so that domestic supply of petroleum products could be improved. “We also continue to support other efforts, including the Dangote refinery and very many other smaller refineries that are coming. And we have a duty to support all this. That’s why we’re at the forefront of supporting these businesses to make sure that they function and they deliver value to our country”, he stated. He said the NNPCL would continue to support every industry in the country, in the midstream, to do this adding the Petroleum Industry Act has made it clear that there would be an open access environment, which means that people can produce oil or gas, and they would have access wherever their access capacity existed.
Despite access to these facilities, Kyari said the NNPCL was also taking another bold step to replace all of the pipelines to a bill of return and transfer mechanism, adding this is already in process. “We have a split contract with a number of partners, and this will clearly, at the end, deliver product near the store to consumers across the country, guaranteeing security for the country, and also guarantee use and accessibility to transport petroleum and drugs across the country.”
