The Group Managing Director, GMD, of the Nigeria National Petroleum Corporation, NNPC, Dr Ibe Kachikwu on Monday lamented that the oil and gas sector was facing a sharp lower revenues from the country’s oil assets.
He consequently advised that the nation must put up strategies to stay afloat in order to mitigate the impact of the fall in oil prices in the industry and on the nation.
The NNPC boss made this known through the Group General Manager, Nigerian Petroleum Investment Management Services, NAPIMS, Mr Dafe Sejebor, at the 33rd Annual International Conference and Exhibition organised by Nigerian Association of Petroleum Explorationists, NAPE, in Lagos.
According to him, “We must renegotiate our contracts to reflect current market realities.
“If the cost/unit barrel remains exorbitant at current low prices, oil production becomes economically not viable; it will simply be left in the ground.
“Portfolios must be re-evaluated because now is the good time to optimise the company’s overall portfolio by restructuring capital allocation away from high-cost, lower-return projects,” he said.
The Minister-designate listed survival strategies to include external financing, operational optimisation, review of fiscal terms, strategic merger and acquisition.
Others are re-engineering business models, reduction in operating expenditure cost, and financial resilience.
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