Austin Avuru, CEO of Seplat Petroleum Development Company, has described Nigerian independents as major players and significant revenue contributors to the Nigerian economy as well as local content champions.
Avuru made the disclosure recently at a round-table discussion convened at the instance of the executive secretary, National Content Development and Management Board (NCDMB) Ernest Nwapa, who hosted the CEOs of indigenous oil and gas companies to a roundtable to deliberate on the impact of the Local Content Act on the oil and gas sector, indigenous operators and the Nigerian economy.
Nwapa said the session was to enable participants take a critical look at the impact of the implementation of the local content act and discuss the issues/challenges faced by the indigenous operators.
In his presentation, Avuru, who is a Fellow of the National Association of Petroleum Explorationists (NAPE) said Seplat like many other Nigerian independents was in full compliance with the Local Content Act. Reeling out figures to support his claim, Avuru said 90 percent of contract spend by Seplat went to local contracts, with contractors in their host communities netting $40 million.
“Our top 50 contractors for 2014, accounted for $460 million of spend and only six of them where foreign companies.”
Avuru said this was set to increase across board as Nigerian independents come into their own and he presented fresh figures to buttress his claim.
According to him, IOC divestments have given birth to seven indigenous independents which now have a combined production capacity of about 275kbd0 and 650mmscfd of gas into the domestic market, which is nearly half of the gas delivery.
He explained that these indigenous independents were deepening the Nigerian financial sectors with debts of about $5 billion owed to Nigerian banks.
Avuru projected that by the end of 2018 indigenous companies would be responsible for at least 1bcf of gas per day. He also projected that by 2020, domestic refining capacity would be about 1MMBOPD.
“We are looking forward to a period, say by 2020 when domestic, integrated oil and gas business will account for 25 percent oil production, 40 percent domestic gas supply and 1mmbopd refining capacity,” Avuru said.
The Seplat CEO predicated his optimism on “Dangote’s refinery project as well as the possible sale of the countries refineries to private companies. “
Speaking further, he asked the setting up of a “national export pipeline as the current export pipelines are owned by IOCs.”
