24 November 2015, Abuja – The Federal Government has warned oil companies against halting their investments in the gas industry in response to the challenges brought about by the volatility in the industry.
In a statement from the Nigerian National Petroleum Corporation, NNPC, in Abuja after the Third Summit of Heads of State and Government of the Gas Exporting Countries Forum, GECF, Member Countries in Tehran, Islamic Republic of Iran, President Muhammadu Buhari assured the GECF of its continuous support as it struggles to surmount the challenges that the global oil and gas industry is facing.
Buhari noted that trying times call for more cooperation and coordination among member countries, while thanking President Hassan Rouhani of Iran for the invitation to discuss issues affecting the GECF and reaffirm commitment to the objectives of the Forum.
Also speaking, GECF President and Nigeria’s Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, identified market volatility, increasing competition, price war and escalating cost of infrastructure development as the key challenges facing the gas industry in general and the GECF in particular.
Kachikwu posited that volatility has brought so much uncertainty and instability to the market thus affecting decisions on investment for long term supply of gas.
He noted that increasing competition occasioned by the surge in new gas producers has led to a price war at a time when the cost of infrastructure development is escalating.
These developments, he argued, are setting the stage for even more challenges for the industry and GECF member countries in the future.
However, he cautioned against reacting to the current challenges by failing to invest in the industry.
He assured that the current challenges will come to pass and the market will rebound given the world’s need for energy and the environmental credentials of gas as the cleanest hydrocarbon fuel.