…As Kyari Seeks Support from Banks, International Community Cracks Down on Crude Oil Theft
The Nigerian National Petroleum Company Ltd has opened talks with the United States Finance Corporation and the Exim Bank to seek funding for its multi-billion dollar gas projects.
The Group Managing Director of NNPC Ltd, Mele Kyari revealed this during the Nigerian International Economic Partnership held in New York on Thursday.
Kyari said: “Inclusion (in the energy transition) means we have to be supported. We are already talking with the American DFC, EXIM so that they can give us funding and financing for our gas projects and that is very important, so that we can have this flexibility to go forward and to the ‘back.
“I’m sure some of you may know that today we are getting a grant to build baseline studies of carbon emissions in our country by the United States government and that is very helpful in the sense that Mr. President has also asked that we need to be supported.Currently the main source of funding that we have comes from the African Exim.
Nigeria’s transition to net zero by 2060 requires huge investments in gas projects which are the country’s transition fuel.
Kyari, however, said Nigeria is looking for opportunities to leverage the country’s huge gas resources to provide the necessary opportunity for the energy transition.
According to the federal government, transit will cost $410 billion and huge gas projects like the recently signed memorandum of understanding between NNPC, the ECOWAS Commission and Morocco to deliver pipelines along the African corridor will gobble up billions of dollars.
“We are embarking on massive infrastructure and to see how we can deliver the gas pipeline from Morocco which will go through a number of countries to provide a certain number of securities, in particular to lift people out of poverty and also an opportunity that exists that we are also doing in the domestic market, thereby increasing the number of gases in the domestic market,” he said.
But the most pressing problem affecting the country’s revenue is crude oil theft, estimated at 700,000 barrels a day.
The government has put in place mechanisms to address the issue that is currently hampering new investment in the sector.
For example, the NNPC launched a reward system for whistleblowers, while security agencies and host communities were integrated into the fight against oil thieves.
Kyari said: “In the oil and gas industry today there is a huge challenge around oil theft in our country, clearly a security concern. It is not beyond containment, as the honorable minister also mentioned earlier, there are so many things that our government security agencies are doing.
“We are collaborating with our partners and stakeholders and it is decreasing very drastically. But it also needs international collaboration to overcome it.
“What we need here is the cooperation of buyers all over the world. Today we have come to where any buyer of Nigerian rough anywhere in the world can be validated we are going to confirm this is the real one as there is no transaction in this industry that doesn’t go through the banking system and I’m glad to see a number of bankers here. There is no place where you can sell crude oil anywhere without going through the banking system.
“This is why we need the help of international banking institutions and more than anything is that we can easily validate what we are doing. These numbers are clear now.”
The NNPC boss, however, acknowledged that issues related to energy sufficiency and inclusion are a critical challenge around the world.
He noted that Africa’s largest oil exporter is very aware of “the effect of our business in terms of emissions and climate impact. No doubt about it. The world does so much about it.
Kyari added: “Our country is committed to net zero by 2060, but it is a path. There must be a pathway to ensure energy sufficiency and inclusion as we move forward. And as a result, the world accepted gas as a transition fuel. There is no alternative to this today for you to bring the basic need that is required.
