What to expect from ‘Nips’ Nigeria’s biggest oil summit – Ibe Kachikwu
CNBC Africa’s Christycole Popoola caught up with Ibe Kachikwu, Nigeria’s Minister of State for Petroleum at the Nigeria International Petroleum Summit (NIPS) for his expectations for the summit and more.
This was borne out of the OTC in Houston and if you’d watched over the last 10-15 years, Nigerians have been the major market for OTC. On the average you would have between 400-5000 Nigerians attending OTC every year. When you look at the foreign exchange dynamics and the fact that over a period of time in my own view it turned into a pleasurable jamboree. Most people were not even going for the conference, they were going to have fun. I thought for the image of the country it wasn’t good and we could we could tap into much more benefits in an OTC style conference. The time has come to begin to look at local technology. What have we achieved.
It is not just going to be seen in Houston every year and then come back. So last year in Houston I declared that it would be the last time I would attend as a minister and it’s certainly the last time that we’ll sponsor people to attend from the Federal Government purse. Anyone who wants to attend Houston on his own is entitled to do so but not with the public sector purse. Instead I thought that we should organise, OTC type conferences in Nigeria and bring the rest of Africa and bring the world, because what are we looking for? We are looking for investments. They are not going to give you those investments sitting there. They are going to give you those investments when they are comfortable here. Education. We want to trap the technological education here. Savings in terms of foreign exchange. Development of our own conference type capabilities. Those were the things that inspired this conference. We are excited that we are doing this. It is the first one and it’s going to struggle but over time, I think it’s going to develop it’s own panacea for success.
We’re looking at leading Africa’s response to global oil challenges can you talk us through some of the issues that you hope to highlight in this.
Leadership in Africa has always been a Nigerian birth gift. We have led in a number of initiatives, oil especially . We’re the highest producer and in terms of cost we are the best today. In terms of diversification of the oil sector we are the best so it makes sense that a lot of African countries who are beginning to come into the foray of production like Ghana, Kenya and Equatorial Guinea where oil has been found that they lear from our own experiences.
Those experiences have been both negative and positive but if we can learn from the examples that we’ve had it will help them in the development of their own policies. Again intra-African collaboration. We look at the fuel crisis that we have today, but why are there no refineries in Africa that can supply and cover the gaps. Why do we have to go to Europe for most of these importations? The time has come to go to Africa to look at some of these importations. This is what the gulf has done successfully.
All the Gulf countries have bunched together. They invest together, they build facilities together and they are able to meet their needs. The European countries are doing the same and so are the Americas. Africa is one place where you have so much economic disparaging. Everybody is standing on their own and looking to their colonial masters for how to get things done. I am trying to change that in the oil industry. This is what we mean when we say we need to take leadership. A lot has been given to Nigeria. We have earned billions and billions out of the oil sector. We need to begin to look at how we’re going to develop and diversify.
Can you talk us through where you are at now in terms of the implementation of the 7 big wins?
First one of the 7 big wins is basically the host community relationship and the Niger Delta militancy. Over the last two years we’ve been able to get a cap on that. It’s been quite a lot of work. Our production was down to as low as below 1 million barrels a day. Now we’re back to full production and militancy has certainly ebbed. So in that area we’ve had a huge amount of success. The other is the business model itself. Funding for the oil sector has improved. We’ve created an alternative to joint venture cash calls and that has bolstered investment in the sector.
The third of course is attracting investment into the sector. Huge, huge investments have come in. A week ago I was in Lagos to commission the Egina FPSO. That is a $15 billion project. Bonga is a $10 billion project. Zaba Zaba is a $10billion project almost as FID. Investments we’ve had into our refinery for the first time are in excess of $2 billion. So in terms of investments over the last 2 years it has quite frankly been unprecedented.
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