Insecurity, Forex Fluctuations Pose Threats to Oil Industry, Says Energy Expert

Emmanuel Addeh

The Group Chief Executive Officer, Vurin Group, Mr. Victor Ude, has listed insecurity of oil and gas assets as well as fluctuations in the foreign exchange market as two of the biggest challenges facing the industry in Nigeria.

Speaking on the sidelines of the Nigeria Oil and Gas (NOG) Conference in Abuja, Ude, who heads the diversified energy, power, real estate, communications and technology services company, stressed that Nigeria must begin to take serious actions to tackle the problems.

The CEO noted that the issues were already affecting Nigeria’s capacity to produce enough Organisation of Petroleum Exporting Countries (OPEC) quota, calling for the deployment of both physical and technological methods.

“The biggest challenge that we face today is insecurity. It has affected our OPEC quota. What we need to do is to protect our assets whether through aerial, sensory, policing or enforcing legislation, it has to be collaborative and institutional,” he noted.

Ude stressed that there are modern technologies which do not only detect but also control the flow of crude oil in whatever form, whether in vessels or pipelines or other ways which can be put into use.

He advised industry players to begin to incorporate ways of lowering emissions or decarbonisation of any type of fuels currently in production, expressing delight that the Petroleum Industry Act (PIA) has already laid the groundwork.

“What Nigeria has done which we all applaud is that it has declared the decade of gas and gas is a transition fuel. So it gives us the chance, whether by way of regulation or policy. It needs to be sustained because the transition is only for a period and we need to invest in renewables.
“Certain policies are already in the PIA and those policies can enhance development. There must be policy and private partnership. We have removed a lot of uncertainties with the PIA, so we can begin to isolate areas of concern,” he noted.
According to him, Nigerians need to invest in areas where they don’t see policy deficits to give confidence to foreign investors, whether in the public or private space.

He said the current fuel scarcity was causing a lot of loss of manpower in the country, stressing that Nigeria has to look at the growth and development of the country and the harm being done by the incessant fuel shortages.

Describing the current challenges as self-inflicted, he explained that the country presently has an underdeveloped midstream and downstream sector as well as being beset with fluctuations in the exchange rate.

“We have to have midterm and long-term solutions and start looking at other sources of fuel, including electric vehicles, which may look too far from us now,” he said.

Ude added that Nigeria needs to discourage unnecessary use of fuels, by making journeys only when necessary, adding that currently the problem is that demand for the product far outstrips supply.

On the demise of the OPEC Secretary General, Dr. Sanusi Barkindo, he noted that the death of the oil industry veteran has resonated beyond the shores of Nigeria.

“It is a loss of an institution of various dimensions,” he stated, noting that in the industry today, no other person currently compares with his wealth of knowledge.