“Good morning, distinguished ladies and gentlemen…

And where there are Excellencies, I also add that. It is increasingly becoming obvious that everybody in Nigeria is becoming Excellency. So sometimes it is difficult to know who to call Excellency and not. Thank you very much for inviting me to this program. Tony did say, “Welcome back” implying that I’ve been gone for about 2 years. I’ve been around, I think the keyword is the transitioning. It’s not retiring, it’s the transition from one level of obligation or role to another.

I’m glad to be here to chair this panel discussion. Let me first start by saying, it is a very critical time in the growth process of the energy sector. The key thing you will notice over the next coming years is obviously the world transition will assume much wider dimension. We are getting to the stages where major oil companies and IOCs are basically walking away from their investments or selling their investments. You are looking at obviously the key concerns about emissions and what needs to happen next. And then, of course, you have a lot of African economies who are emerging into this sector and looking for opportunities to be able to grow, and indeed join the league of oil-producing nations, so it is usually a very critical period.

I do share Farouk’s (the Secretary-General of the African Petroleum Producers’ Organization) concerns sometimes. It’s almost like we are not leaping ahead well enough. We get from firewood period to coal period to oil period and each time we are miles behind, and so that is why the warnings of Tony are very critical and it’s important that as we look at the transition period, we begin to make bounding leaps towards the next generation movement in this sector. Otherwise, again, by the time we get there, we will be lost in the transition.

But I think it is also a huge opportunity period for oil investors or national investors in the African continent, both individual and corporate, and both individual and national. That’s why I am particularly glad that we are having this session that involves national oil companies, because ultimately, a unifying and bonded relationship between these national oil companies, obviously led by the likes of Nigeria and Angola, will help to catalyse this group as the next vehicles of development in this sector. So, it is very critical that we begin to find forums in which we all come together, share thoughts, and look at what investment potentials are. Nigeria has done quite a lot in the last couple of years in terms of energizing private sector investments by Nigerians, and I’m beginning to see a lot of Nigerians get outside Nigeria to own blocks in very many countries in Africa and to indeed join as investors and financiers of foreign exploration and production activities in those areas. But the sort of funds that we have are not enough. We need to look at leverage on regional organizations who have requisite funding for this to be able to grow.

So today, I will be particularly interested in hearing what the opportunities are in these sectors. Whether it is places like Senegal, which have been able to at least transition out into being able to find and discover their own oil and beginning to create a mix of production. To the likes of Kenya and the rest who are beginning to grow in those areas. Or the likes of Liberia, which has some of the most versatile fields available in the African continent right now. Or Nigeria, which continues to grow and continues to look at new opportunities. It will be nice to see what each country is doing and what the opportunities are. And I think the essence of this gathering will be to then, for those of you who are private sector players in this area, to look at what is happening in these countries and how can you leverage on what you see here today, to encourage you to get into these counties and make your investments.”

AFTER THE SUBMISSIONS

“We are far gone in time, so we won’t be able to take the questions and answers we have projected. We would advise parties who are interested in investment in a lot of these countries to see them directly. I would also expect that those who are behind SAIPEC will have obviously online, some of these presentations and the opportunities emerge.

Just a few quick summaries:

1. The first is that there’s continued to be very aggressive play in the O&G sectors all over Africa. And this is at a time when we are all worried about the transition concerns. The volumes that are going to be hitting the market over the next ten years are fairly massive. And if the transition moves at a fairly rapid pace, then we have certain things to worry about.
2. The second is that the major oil companies, who indeed at the forefront of this transition process, need to maintain leadership positions in terms of investment in these countries, so there’s a little bit of distortion.
3. aggressive play in some of the emerging oil and gas play areas.
4. and yet, the very aggressive exits in the very mature areas.

The exits over the last four, five years, according to Wood Mackenzie, over 30 billion dollars worth of investments have been offloaded by the major oil companies all over Africa.

So, the question is, “is it that the countries that are emerging now would prepare themselves for some level of investment shock down the road when these companies begin to exit, or they will be ready for very aggressive and fairly unfair terms of exploratory acreage awards?” It’s just going to be one of those, it can’t be both.

And so, the concern for us here is, okay, fine, a lot of volumes coming, funding facilities exiting, transition getting very, very aggressive. What is the future? The future definitely has to be that NOCs, like all of you here present, must begin to come together, and first of all, look at how do we have a regional transition program that everybody can play into and can help develop so that there is some universality in the play in this area. The second, of course, is that major NOC players, the likes of NNPC, the likes of Angola’s National Oil Company and the rest, must begin to see how they can handhold a lot of these companies in the play of things. There are lots of opportunities for private sectors play, but like you know, most of our private sector players are still in their infancy. They are very dependent on financing mechanisms from global institutions, and these are not going to be forthcoming very easily given the transition dynamics.

I would have loved to also see… and I see a lot of gas play which is good because it is a transitional product. But I would have loved to see quite a lot of gas exposé on issues of solar and issues of wind, and this I hope will be part of the global regional transition program that we will like to see developed here.

Very many years ago, I remember going to Houston and saying, look, it was time to shut the door a little bit on the conference that we have in OTC every year, because I could see this coming. And I said there was a need for us to begin to look internally into our system and develop our own conferences, create investment profiles that will help bring foreigners here, and then we started NIPS (now NIES), and I’m happy today that NIPS is growing leaps and bounds. It’s what we need to do because in another ten years, really, we will have to find the funding if we want to continue. Now for countries that are not even looking at backward integration, that will be a shame, because, ultimately, when the oil is in your hands and it is produced, if you do not have market for it, you’ve got to use it for your own local resource energy and support. So, refineries, petrochemicals, all kinds of backward integration dynamics are very essential and we’ve got to begin to look at that very drastically. I don’t still think we are paying much attention to those as we should. We are very export-prone which is good for foreign exchange earnings, but ultimately those will dwindle and dry out.

So, thank you very much, my panel of discussants; extremely helpful exposes, and I think what it says to us is that a lot of opportunities are bound, a lot of issues arise, a lot of concerns need to be addressed, and there’s a need, an absolute urgent need, for global hand-holding within the African region to see how we move forward in terms of these resource applications and development.

Thank you very much for listening”