Expanding Oil and Gas Exploration and Production in Niger

The International Energy Agency (IEA) predicts global demand for oil and gas will increase and demand for oil alone will increase by 3.3 million barrels (mb/d) per day by 2022 and return to pre-COVID levels of 99.7 mb/d , a development that will provide opportunities for African producers such as Niger to expand the oil and gas industry and help meet demand.

In an effort to increase exploration and production to achieve this goal, Niger is making its regulatory and fiscal environment conducive to oil and gas energy market players.

The recent signing of the Niamey Declaration between the energy ministries of the Republic of Niger, Algeria and Nigeria during the Mining and Petroleum Forum of the Economic Community of West African States (ECOWAS) in Niamey on 16 February 2022 is a game changer that will unlock the potential of the country’s oil and gas sector. in meeting global energy demand.

The agreement paves the way for the development of the 4,128 km Trans-Saharan Gas Pipeline project that will link three African countries with European markets to trade up to 30 billion cubic meters of natural gas per year.

A 1,950 km $4.5 billion pipeline project is also underway in Niger and is expected to increase the country’s production capacity fivefold by 2023, once the project is operational, establishing the West African nation as an energy hub for regional and continental energy supplies. demands.

In addition, the development is expected to provide significant economic growth for the West African country. All of these infrastructure development projects aim to attract investment that can be used to develop the country’s oil and gas industry. They also challenged the government of Niger to expand its exploration activities to increase its portfolio of oil and gas capacity to be able to play an increasing role in helping to meet local, regional and international energy demands.

“What Niger and the major oil companies have achieved in such a short time is impressive, demonstrating how political will, a transparent and productive framework, and an enabling investment environment can drive energy sector growth,” said NJ Ayuk, Executive Chairman of African Energy Chamber.

Despite having large oil and gas reserves, governments in Africa are struggling to establish regimes that attract capital for infrastructure development and exploration and production activities that will help boost the economy.

With the right policies and infrastructure development, Niger’s oil and gas sector is expected to account for around 24% of the country’s GDP, 45% of tax revenues, 68% of exports and 8% to 12% of formal employment by 2025.

Spending on exploration and production needs to be optimized so that the West African country can utilize its gas reserves to achieve economic prosperity and energy security. Currently, Niger’s oil reserves are estimated at 3.7 billion barrels and the country produces about 20,000 barrels of crude oil per day which is refined to meet local demand and exported to Nigeria, Mali and Burkina Faso.

To expand its gas and oil potential, Niger has enacted policies that encourage the participation of international market players as evidenced by the government forming a joint venture for exploration and production purposes with China National Petroleum Corporation in 2003. Various international companies including Tamoil, Mobil and Total are present in the market. the country’s oil and gas and local gas companies Nigergaz and Sonigaz continue to expand operations with a particular focus on exploration and production for economic growth and energy security.

Laws such as the 2017 Petroleum Regulations grant companies a year of exploration and 25 years of production activity and exemptions from VAT and customs duties, making Niger an attractive investment destination.

Niger’s enormous oil and gas resources remain untapped and discussions to be held at African Energy Week 2022 (AEW), Africa’s leading investment platform, taking place in Cape Town from 18 – 21 October 2022 – will focus on how the model is implemented in Leading gas and oil producers such as Nigeria, Libya and Angola can be replicated to grow Niger’s exploration and production.

The IEA states that Africa will become increasingly influential in shaping global energy trends over the next two decades and with the continent being home to five of the world’s top 30 oil producers, AEW 2022 will highlight the role regulation can play to unlock the investment needed to strengthen exploration and development. oil and gas production to address energy poverty.

AEW 2022 will explore how governments and market participants in Africa can attract more funding that could enable them to increase their market share in the global market.

Distributed by the APO Group on behalf of the African Energy Chamber.

AEW 2022 is AEC’s annual conference, exhibition and networking event. AEW 2022 brings together African energy stakeholders with international investors and partners to drive industrial growth and development and promote Africa as an energy investment destination.

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Expanding Oil and Gas Exploration and Production in Niger

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