15-03-01 Reiterating its determination to encourage massive indigenous participation in the oil sector, the Federal Government has said that attempts by the multinational companies in the sector to discourage the growth of indigenous oil companies would be checkmated.
President Olusegun Obasanjo gave the warning in Abuja in an address at a two-day international conference on "Partnering and Alliancing" organised by E & A in collaboration with Perch Stone and Graeys. Stressing the need for collaborative efforts among oil companies, including indigenous ones in oil exploitation, Obasanjo noted the business was cost-demanding and the only way to reduce cost was through partnering and alliancing.
In doing that, however, he urged the multinationals to carry the small and indigenous companies along in line with the nation's need to encourage local participation. He, therefore, reminded them that any proposal that tended to scuttle local participation would be discouraged by government.
His words: "These new collaborative initiatives are evidently demanding of close scrutiny, especially for the purposes of determining their applicability to the Nigerian environment. This is especially compelling in the light of our commitment to increasing indigenous participation in the Nigerian oil industry. "A major drawback of any collaborative initiative would, therefore, emerge if it were seen as likely to result in the demise of opportunities for smaller companies and especially the indigenous players that we consider strategically important to the future growth of this industry."
He continued: "You will no doubt appreciate that this government would be unable to endorse or support any scheme that whittles down our gains in terms of developing a local oil and gas industry or those that block smaller innovative companies from access to work."
The President, who was represented by the Permanent Secretary in the Ministry of Petroleum, Mrs. Amma Pepple, further disclosed that government's intentions for the sector were to increase reserves, reduce pressure on the environment, maximise profit through cost reduction and increase in local content. He, therefore, charged multinational companies in the sector to come out with proposals aimed at pushing further, the business of oil exploration and exploitation.
On the part of government, the President noted, licensing rounds would be given in future in the much deeper waters than the ones earlier given just as enabling environment would be created for partnering and alliancing. Also speaking on the occasion, Group Managing Director of NNPC, Mr. Jackson Gaius-Obaseki, disclosed that the present administration had set a producibility target of 3 mm bpd for 2003, while in 2010, the target would hit 4 mm bpd. He expressed government concern over the dearth of local content in the upstream sector despite its huge financial commitment.