Energy Transition: NNPC Tasks Stakeholders On Gas Utilisation

Nigerian National Petroleum Corporation (NNPC) Ltd. Group Chief Executive Officer Mallam Mele Kyari has urged stakeholders to take advantage of the nation's abundant oil and gas resources in order to strengthen the economy.

Kyari gave the speech on Tuesday in Lagos at the 40th annual international conference and exhibition of the Nigerian Association of Petroleum Explorationists (NAPE).

The conference's theme is "Global Energy Transition and The Future of the Oil and Gas Industry: Evolving Regulations, Emerging Concepts, and Opportunities."

Before the window for fossil fuels closed, Kyari, who was represented by Adokiye Tombomieye, the Executive Vice President (Upstream) of NNPC, said, Nigeria must support sustainable growth and social development for both the current and future generations of Nigerians.

According to him, the importance of energy in a country's sustainable development and economic progress cannot be overstated.

According to the NNPC CEO, the Nigerian economy is a good illustration of the contribution that oil and gas resources have made to fostering growth and prosperity.

“The structure of the industry and its impact on the global economy has encouraged intensive research and innovations to support investment decisions, improve operational efficiency, minimise the impact on the environment and give players a competitive edge.

“Oil demand in Africa stood at an average of 4.36 million barrels per day in 2022.

“Even though Africa has the world’s lowest levels of per capita use of modern energy; its demand is set to increase with growth in population and incomes.

“As its population and incomes grow, demand for modern energy expands by a third between 2020 and 2030.

“Today, 970 million Africans lack access to clean cooking gas,” he said.

According to Kyari, the energy mix has become more diverse as a result of increased campaigns to employ sustainable energy sources and the shift toward a net-zero future.

He continued by saying that hydropower was the sole significant source of renewable energy in Africa, although fossil fuels still accounted for the majority of the continent's energy balance.

“It is, therefore, our firm position that fossil fuel will continue to contribute more than 50 per cent to the Energy Mix in Africa and possibly the rest of the world.

“Recent happenings in the Russian-Ukraine crisis have seen the resurgence of the need for fossil fuels and in some cases adverse use of high-carbon generating energy sources like coal.

“This also points to the fact, that energy transition implementation has to be gradual,” he said.

The industry, NAPE, and other important stakeholders must redouble their efforts to address the issues brought on by the shift, he continued.

Kyari claimed that as banks, multilateral lenders, and investors shifted money away from fossil fuels and toward renewable energies, the financing of oil and gas projects had grown increasingly challenging.

He also contends that while developed nations are pursuing aggressive energy transition plans, many developing nations, particularly those with hydrocarbon-dependent economies like Nigeria, need a more flexible and gradual strategy.

He claimed that Nigeria's energy transition had produced significant business opportunities, such as the establishment and growth of solar energy, hydrogen, and electric vehicle industries.

“It is pertinent to acknowledge that Nigeria is well endowed with abundant renewable energy which includes hydropower, solar photovoltaic technology, wind, geothermal and biomass.

“These alternative energy sources can be exploited to diversify the nation’s energy mix beyond the current fossil fuel sources and guarantee energy security for the nation,” Kyari said.

He continued by saying that there was still a lot of untapped potential in the renewable energy industry and that acquiring the necessary funding, alliances, and technology would speed up significant investments in the country and bring it into alignment with the global decarbonization drive.

Dr James Edet, president of NAPE, stated in his remarks that the strategic evaluation of the Nigerian energy industry was necessary for light of the growing need to transition to more sustainable energy sources and the changing geopolitical landscape.

According to Edet, the country has a plan for its energy transition to reach net zero greenhouse gas emissions by 2060.

However, he asserted that numerous factors needed to be taken into account and properly addressed in order for the country to transition to its future of sustainable energy.

“The reality of the climate change is facing Nigeria with desertification in the north and flooding in the south and some parts of the north.

“This change calls for a crucial need to significantly reduce carbon emissions while ensuring available and affordable electricity.

“The oil and gas industry has a role to play towards the successful implementation of these regulations and ambitious plans,” he said.

He added that globally, significant consumers of the hydrocarbon industry were undergoing a massive technological shift towards low or zero-carbon energy usage like electric vehicles.

“The ongoing war, global politics, in-country insecurity challenges and asset divestment have exacerbated the impact of energy supply shortage and altered the energy landscape,” he explained.

The conference, according to the president, will focus on adapting to a changing environment, geoscience training for the new energy mix, and the application of new technology in exploration and production.