Wale Tinubu, the Group Chief Executive Officer of Oando Plc, believes that Nigeria’s onshore oil and gas assets should be managed by local companies. Speaking during the World Economic Forum in Davos, Switzerland, he explained that indigenous firms are better equipped to handle these assets due to their close ties to host communities and their ability to manage security challenges effectively.
Tinubu highlighted that local players in the oil and gas sector can engage better with host communities and government regulators, making operations smoother. According to him, Nigerians have the skills and resources needed to manage onshore oil operations successfully.
Key Points from Tinubu’s Remarks
- Technology and Skills: Tinubu noted that the technology required for onshore drilling is readily available and that Nigerians are well-trained to use it.
- Security and Community Relations: Local companies are closer to host communities and can address security issues more effectively than international firms.
- Economic Impact: Tinubu emphasised that boosting onshore oil production would improve Nigeria’s foreign exchange earnings, stabilise the Naira, and support economic growth.
He said, “In a country like Nigeria, with our current economic challenges, we must improve exports and secure foreign exchange to strengthen our economy. The oil industry is the fastest way to achieve this.”
Why International Oil Companies Are Leaving Onshore Operations
In recent years, many international oil companies (IOCs) have exited onshore operations in the Niger Delta. Challenges such as oil theft, sabotage, spills, and disputes with host communities have made it difficult for these firms to operate.
Some notable exits include:
- Eni (Italy): Sold its onshore assets to Oando Plc for $783 million.
- ExxonMobil (USA): Sold its Nigerian assets, including onshore and offshore operations, to Seplat Energy Plc.
- TotalEnergies (France): Sold a 10% stake in Shell Petroleum Development Company to Chappal Energies.
- Shell Plc (UK): Sold a 30% stake in its Nigerian onshore operations to a consortium of local companies.
These international firms are now focusing on offshore operations, which are less affected by security issues and community tensions.
Addressing Onshore Challenges
The Niger Delta has long been plagued by problems like oil theft and environmental damage. Despite government efforts, including the 2009 amnesty programme and the creation of the Niger Delta Development Commission, the situation remains unresolved.
In 2024, Nigeria recorded over 589 oil spills, most of which were linked to oil theft. Tinubu argued that indigenous companies are in a better position to tackle these challenges.
Looking Ahead
Tinubu’s call for more local involvement in Nigeria’s oil and gas sector aligns with the country’s push to revitalise its economy. By managing onshore assets locally, Nigeria could maximise its resources, create jobs, and boost its global competitiveness.
