The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kyari, yesterday said getting appropriate financing for major projects remains key challenge in the global transition to renewable sources of energy.

Kyari, who spoke on the sidelines of the Abu Dhabi International Petroleum Exhibition Conference (ADIPEC) in the United Arab Emirates, insisted that no nation should be stampeded into abandoning fossil fuels because each country has its peculiar energy history.

The NNPC GMD noted that with the commencement of the implementation of the Petroleum Industry Act (PIA), investors were beginning to pour into the country especially to invest in the deep-water segment of the oil and gas industry.

According to the NNPC helmsman, Artificial Intelligence (AI) remained the future of the strategic application of technology in the industry, explaining that although Nigeria is still at the very basic stage, it also has the advantage to procure the most modern carbon-free systems.
Kyari argued that the Nigerian oil industry had become more competitive with the new PIA, maintaining that the country now has a clearer fiscal environment and a stronger regulatory ecosystem.

“We are at the threshold of history. Our country has changed and our industry has changed because we have a new legislation that has brought clarity in the way we do our business. We have a much more competitive fiscal environment and much more modern regulatory environment and we are seeing the outcome of all these coming up.

“Our partners are coming up to invest, especially in the deepwater and also a lot of efforts are going on to bring back all of the production that we have lost and we are very excited for our country.

“I think the key challenge of the energy transition is financing what we need to do today, to produce gas and consume gas in the best possible manner and you can’t produce hydrogen without properly doing it. The key challenges is financing and also realising that different countries have different circumstances, that jurisdictions are different and that we can’t move at the same pace,” he stated.

He urged proponents of the energy transition to appreciate the basic fact that the circumstances of every nation is peculiar and take it into consideration.

“Countries have different exposures and the handling (of the transition) must be in different manners and I am not sure this is properly appreciated,” he stated.

On the application of technology in the transition process, he added: “Artificial intelligence is the way to go in the future. We saw this coming, but currently we are at the basic level , but we are making efforts to ensure that we automate our systems and our processes.

“We will make use of the best technology that is available. But Good enough for our country, we are starting from almost ground zero in sub-Saharan Africa and so carbon production petroleum systems will now be based on the basis of current technology that is available and clearly the emissions will be quite low in this circumstances,” he added.

He stated that although climate change is real, there are real problems in the world, noting that for this reason, every stakeholder must work together.

“We should work towards net-zero by 2050, for some countries 2060, but obviously it’s a step we must take and I think it’s a good development,” Kyari stressed.

On the importance of the conference, he stated that ADIPEC had brought everyone on the table to realise that the entire industry needs to work together to achieve net-zero by 2050 or “shortly after that.”

Meanwhile, the Group Executive Director, Gas and Power, NNPC, Mr. AbdulKabir Ahmed, has said the implementation of the PIA has opened more opportunities for investors in the Nigerian oil and gas sector.

Speaking on a panel at the same event, on the theme ‘‘Building the Energy Company of the Future: New Business Models and Investment Flows”, Ahmed emphasised that since the PIA became law, many opportunities had been made available to investors, especially in the area of gas.
“We have seen some kind of opportunities as far as the law is concerned. We have seen several bottlenecks that have been removed and those who wish to invest are encouraged to come and invest and it is everybody’s destination for now and those who have investments they want to make are welcome,” he said.

He attributed the rising gas prices to certain uncertainties brought about by production and supply challenges coupled with the climate change issue.

“There are a lot of uncertainties, not only in terms of production and supply, but we also have nature itself playing its own role and we can look at it from this perspective.

“When you look at the climate change, the winter, the direction of the timing whether it is prolonged or shortened, it now gives you this kind of energy demand. Then, you cannot determine when the winter will begin and that can spur volatility,” he stressed.

Ahmed explained that the NNPC will continue to do more in deepening the gas sector by finding the most convenient way of transporting gas, adding that the corporation will continue to build infrastructure in addition to the pipelines that are being built.

“A lot of confidence is being reposed in Nigeria as an investment environment. Now, that is leading to the Train 8. We are also contemplating on it. So, if Train 8 is being contemplated, then that means that that environment is still viable for investors to come in,” he said.