TotalEnergies Seeks Attractive Fiscal Environment to Encourage Investments in Big Gas Devt Projects

Blessing Ibunge in Port Harcourt

Multinational oil firm, TotalEnergies, has stressed the need for the Nigerian government to put in place adequate fiscal framework that would attract more investors in the development of big gas fields in the country.

The company explained that a favourable investment climate was urgently needed for oil and gas companies willing to embark on projects that would enable Nigeria explore and produce more of the abundant gas resources existing in the country and move away from just Associated Gas (AG) to Non-Associated Gas (NAG).

The Deputy Managing Director (Deepwater), TotalEnergies EP Nigeria Limited, Mr. Victor Bandele, made the call in Lagos, during a panel session at the just-concluded Society of Petroleum Engineers (SPE) Nigeria Annual International Conference and Exhibition (NAICE), with the theme: “Balancing Energy Accessibility, Affordability, and Sustainability: Strategic Options for Africa”.

He said TotalEmergies was contributing efficiently in natural gas sustainability in Nigeria.
Speaking on the topic: “Role of Foreign Direct Investment (FDI) in the Efficient Development of Natural Gas Reserves to Meet Africa’s Energy Security Demands,” Bandele stressed that gas needed to be developed not only as a by-product of oil, but as a standalone product of high value.

He said: “There is no way we will develop energy today based on the same terms and conditions that we are using for associated gas.
“When we look at the fiscal terms that we have today, honestly, we will spend a lot of time discussing and discussing. I don’t think that people will come in.
“When I want to develop associated gas, I can run my economics on oil, and gas will just be bonus, we have past that era.

“I don’t think that people will come in to do NAG development on a large scale if the fiscal terms are not convenient and not appropriate.”
Acknowledging steps being taken by the government on energy transition, Bandele, however, stressed the need to take bold steps in finding the right environment to carry out energy development in Nigeria similar to what other countries were doing.
“In Nigeria today, we have more than 200 trillion cubic feet of proven gas reverse. In 2022, the total production of gas was about 1.4tcf. Of this 1.4tcf, less than 1tcf was for Nigeria Liquefied Natural Gas (NLNG).

“If you are looking at the statistics, you will ask whether what we did in 2022 is where we are supposed to be.
“If our proven reserves is in excess of 200tcf, and we are monetising in the neighbourhood of about 1tcf in a year, we are really not playing the game. So, this is the first instance that we have to bear in mind. We talk about this reserve – 200tcf, where is the 200tcf, where are they locked,” Bandele asked.

Maintaining that about 50 per cent of the gas in Nigeria was associated gas, he stated that what it meant was that they were produced as oil was produced.
According to him, there are available infrastructure producing oil to some extent but there is also need to achieve the clean energy transition as fast as possible.
“Let’s assume we have a means of producing some of our associated gas, about 50 per cent of the 200tcf is non-associated, meaning that we need to find infrastructure that will be suiting for gas development, find environment that will suit people to bring money to develop gas as a single item, are we doing that,” he asked.

He disclosed that for the past 10 years, TotalEnergies had ensured that all its new projects were non-routine flaring compliant.
“TotalEnergies supports Alaoji gas plant for gas, supports the Indorama for gas,” he added.
Bandele however, stated that TotalEnergies was desperate to remain relevant in Nigeria, adding the company has presence in the upstream, midstream, in the downstream, as well as in the renewables.
He said the company was optimistic about Nigeria and sees the human resource in the country as enormous.