The African Energy Chamber (AEC) warns the oil and gas industry of challenging times ahead and urges a rethink of offshore licencing procedures and environmental standards if the sector is to survive.
The oil and gas industry has been hit by a number of challenges paused by the decarbonisation and the shale gas revolution then Covid-19 also hit.
The global pandemic significantly reduced demand for oil and gas; projects have been stopped to secure cash flows and investments are not being made, which is particularly difficult for offshore exploration.
In the Chamber’s annual report, senior vice president of the Chamber,Verner Ayukegba, urges the industry must take a ‘now or never’ approach to reform.
“What is important is that whatever is done in Africa it needs to be market responsive. So thinking less about putting a charge on carbon emissions but rather giving incentives, which the Chamber is looking at, to companies to develop infrastructure that helps to capture gas and push it to power.
“Oil and gas operates in a global space, Africa is competing with Mexico and the Middle East and investors are now taking a second, third, fourth look at projects before they dive in. This means if we do still have uncertainties in places, like in Nigeria, especially for offshore due to the Petroleum Industry Bill, which has not yet passed into law, then there will be difficulties,” he said.
The IMF’s mandate is to safeguard the stability of the international monetary and financia…