Divestment Activity Enhancing Nigeria's Oil and Gas Sector, Says Renaissance MD

Engr. Tony Attah, the Managing Director of Renaissance Africa Energy Company Limited, has stated that the ongoing transition through divestment is proving valuable for Nigeria’s oil and gas sector, noting that independents are now responsible for more than fifty percent of the country’s crude oil production.

During the Nigerian Content Academy Lecture, themed “Finding Funds for Effective and Efficient Local Content Initiatives – IPPG Perspective,” Attah expressed his projection that Nigeria will witness the rise of five significant Nigerian independent oil companies within the next ten years.

He also forecasted that numerous indigenous oil and gas operators in Nigeria will engage in strategic consolidations and form consortiums to capitalize on emerging opportunities in the coming decade. This prediction was shared via a statement from Dr. Obinna Ezeobi, General Manager of Corporate Communications at the Nigerian Content Development and Monitoring Board (NCDMB).

Attah emphasized that global collaboration is key to the future of the oil and gas industry. He expressed satisfaction with the substantial growth in the operational and funding capabilities of indigenous companies in Nigeria, which has enabled them to successfully acquire and manage fields previously divested by international oil companies (IOCs).

He observed that while international independents often take over from IOCs in mature markets elsewhere, Nigerian independents are stepping in within Nigeria. "That transition is showing value today. More than 50 percent of Nigerian crude oil production is associated with independents. I see a future where more Nigerian independents would have to consolidate," he stated.

"Renaissance is here, Seplat is here. The consolidation would have to be among the others to create the other three or five," Attah added.

He highlighted the successful formation of Renaissance Energy, a consortium comprising four Nigerian companies – ND Western Limited, Aradel Energy Limited, Waltersmith Petroleum Development Company Limited, First Exploration and Petroleum Development Limited – and one international firm, Petrolin Trading Limited. He attributed this successful deal to the enduring collaboration, perseverance, and ambition of the founding companies.

Engr. Attah, who previously served as the Managing Director of Nigeria LNG Limited and Shell Nigeria Exploration and Production Company (SNEPCo), also detailed effective funding strategies that players in the African energy sector can adopt to address global funding and operational challenges. These strategies include Capital Markets/Stock Exchange Listing, Private Equity and Eurobond, Strategic Partnerships/Joint Venture Structures, International Oil Company (IOC) Carry Arrangements, Prepayment/Offtake Financing, and Bank Facilities.

Meanwhile, Professor Babs Oyeniyi, joining the discussion from Edinburgh, UK, raised concerns about the Nigerian oil and gas industry's continued reliance on retired personnel for critical services.

In her opening remarks, Ms. Doris Opuwari, General Manager of the Nigerian Content Academy at NCDMB, acknowledged that funding limitations have long hindered the growth and expansion of indigenous players. She expressed confidence in Engr. Attah’s expertise to provide guidance on overcoming these challenges.