There is no going back on 40m barrels oil reserve – Buhari

President Muhammadu Buhari has stated that Nigeria’s quest to achieve 40 million barrels oil reserve in the nearest future is irreversible.

The President, who stated this at the Nigerian International Petroleum Summit, NIPS, holding in Abuja also said that notwithstanding the fact that energy transition has become a reality, as renewable technologies are getting cheaper with investors becoming conscious of environmental issues and turning their back on hydrocarbon investments, events in the past have proven that human beings have inflexible appetite for energy.

Buhari, who was represented by Timipre Sylva, Minister of State, for Petroleum Resources, assured that renewable energy does not have the capacity to cope within the foreseeable future. He said: “Fossil fuels will continue to be the source of dozens of petrochemicals feedstock that companies will transformed into versatile, and final materials for modern life.”

“We cannot turn our back yet on more exploration, discovery of new fields is crucial. And we also need to address short term opportunities using existing technology that can extend the life of mature fields. Nobody should doubt our commitment in this regard, given a bold move to issue new marginal fields licenses.”

Also speaking, the Group Managing Director of the Nigerian National Petroleum Corporation NNPC, Mele Kyari stated that funding is a major issue in the industry.

He said, “We are also aware that cost is everything in the future. The crisis has thrown up the fact that only the best of producers will survive and therefore cost control become a major issue in the industry.

“Funding also is a major issue in the industry today for two reasons. One, there is paucity of resources across the globe and secondly, there is overall reluctance by investing companies and banks to put money into fossil fuels related businesses.

“But obviously these are issues we have to live with however the best of the businesses that will survive are the ones that try to transit into climate friendly businesses”, he added.

Secretary General of OPEC, Mohammad Sanusi Barkindo, expressed worry over issues of insecurity in the country, which he said required the efforts of all and sundry to nip it in the bud. He also expressed concern about the negative impact of Covid-19.

He said: “As the world economy contracted by 3.5 per cent year-over-year in 2020, global oil demand declined by 9.5 million barrels daily, mb/d. During the month of April 2020, oil demand dropped by a staggering 22 mb/d. And yet, President Buhari and his Government bravely rose to both of these great challenges.

According to him, the global economy, oil market fundamentals and the oil demand outlook have all been encouraged by positive news on vaccine rollouts and the continuing massive fiscal stimulus that is driving the economic rebound.

“OPEC has revised its global economic forecast up to 5.5 per cent for 2021, and the oil demand growth forecast remains at 6 mb/d. It should be borne in mind that the majority of this demand is back-loaded to the second half of 2021.

“A backwardation structure remains in all major crude oil benchmarks.

Additionally, we saw a draw of 6.9 mb month on month in OECD commercial oil stock inventories in April. This is 160 million barrels lower than the same time one year ago and 34 million barrels above the 2015-2019 average.”According to him, there would be further draws in the months ahead, adding that despite the positives, it is clear that uncertainties remain.

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