Stakeholders in the energy sector have suggested ways Nigeria can achieve full deregulation in the course of the current energy transition being experienced globally.
They also urged Nigeria not to waste time in keying into the energy transition early enough, stating that the benefits are enormous.
The subsidy that is put into petrol they said should be diverted to renewable while also advocating for full deregulation of the power sector.
The deregulation of the downstream of the Petroleum industry they said should be based on local production so that the economy can move in the direction it should go.
The stakeholders who spoke at a panel of discussants at the 2021 NAEC Strategic International Annual Conference with a theme, PIA: Energy Transition And the Future of Nigeria’s Oil and Gas Stated their own views about the energy transition as it relates to the oil and gas sector of the economy.
Olufisayo Duduyemi, chief strategy officer Axxela Limited, in his comment, said in the context of the energy transition, it is acknowledged that there would be a significant reduction in the use of fossil fuel in the years ahead and urged Nigerian to switch over to natural gas as fuel of choice.
He stated that it is through the usage of natural gas that Nigerians can experience some soft landing from the effects and impact of full deregulation of the downstream sector of the oil and gas industry.
The Axxela chief strategy officer advised that the country’s gas resources should be harnessed and monetized.
“Let us put gas into our processes and industries. By so doing cost of production would reduce, cost of commodities would drastically reduce and would become more available to the masses, this is the role natural gas is playing now and in the future,” he said.
In his contribution on having a smooth landing as regards deregulations, Wiebe Boer, Chief executive officer of All On, an investment company that is investing in renewable in Nigeria and funded by Shell, said renewable energy is the future of energy
According to him, if we spend so much time as a country figuring out this problem on an industry that is currently losing momentum or becoming outdated in the world, he fears that we would be left behind in the energy transition as well.
He the government has tried bypassing the Petroleum Industry Act ( PIA ) which means there would be full deregulation in the downstream sector of the Petroleum Sector. He also advocated for total deregulation also in the power sector so that the economy can just move in the direction it should move.
He said there is a lot of interested parties are coming into the market and this is a big opportunity for Nigeria.
He stated that some downstream companies with petrol stations are thinking of transforming those petrol stations from just selling petrol to providing services in areas such as renewable so that Nigeria can key in into the drive of renewable.
On how a just transition can be ensured in the country, he said, we should just take the petrol subsidies away and invest in renewable energy, especially solar, wind and a few others so that any village or anybody in Nigeria can have access to electricity.
Festus Osifo, President of Petroleum and Natural Gas Association of Nigeria (PENGASSAN) said while organized labour is not opposed to deregulations, it is difficult for the government to transfer its inefficiencies to the masses. He said what has happened over the years is that we have governments that are just inefficient.
According to him, it is that inefficiency that is making our refineries not to work today. “if the refineries were working I don’t think that the labour organizations would oppose deregulation”. He said mid nineties the direction of labour has been government why not fix the refineries. So that the foreign component that goes into the costing would be eliminated.
Just imagine today, people working in refineries are Nigerians, you will pay them in Naira. So when you are, when the dollar is appreciated against the Naira, at the end of the day, the manpower is stabilized. The cost of labour is in Naira and not in dollars. So the only thing you now price in dollar is the cost of crude oil.”
He said what the organized labour told the government is that fix the refineries, when the refineries are working we would support you to deregulate, that what they don’t want is import drive deregulation. But it should be based on local production.
He said that there has been trust deficit that has existed between the government and the people over the years.
If the privatization of the power sector has been done in Germany, or South Africa, it would have been successful, but since they sold them to their friends the exercise has been a failure. And after selling the Gencos and Discos to their friends they ended up lending them the taxpayer’s money to run this enterprise. Which were grossly undervalued?”
He said they are supporting deregulation but it must be based on local production.
Adeola Yusuf, said lack of trust has been the reason why the people are not supporting Government. He said the government has been talking to people and not communicating with the people. Because the government is not communicating with the people.