2024 NOG ENERGY WEEK INDUSTRY KEYNOTE ADDRESS FROM MR. ABDULRAZAQ ISA OFR CHAIRMAN, INDEPENDENT PETROLEUM PRODUCERS GROUP (IPPG)

Your Excellencies, Captains of Industry, Distinguished Ladies and Gentlemen. Kindly permit me to stand on already-established protocols for the day.

1. On behalf of the Independent Petroleum Producers Group (IPPG), it is with great honour and a privilege to once again deliver this industry keynote address at the 2024 NOG Energy Week. I extend our warm greetings to all distinguished guests and esteemed delegates gathered here today.

2. I must begin my address by using this opportunity to once again appreciate His Excellency, President Bola Ahmed Tinubu GCFR, for the transformative reforms being undertaken by his administration. Specifically, the recent presidential executive orders and directives are a welcome development for the industry. Also of note is His Excellency’s direct intervention in untangling issues in some of the long-overdrawn IOC divestment transactions – these delays have been costly to the industry and extremely detrimental to the nation as a whole. We are encouraged to see swift progress on implementation and some tangible results within a relatively short period of time. Such progressive and impactful policies are exactly what the industry has consistently clamoured for to sustainably develop and move the industry forward.

3. Permit me to also use this opportunity to appreciate the Honourable Ministers of State, Petroleum Resources, Oil and Gas – Sen. Heineken Lokpobiri and Rt. Hon. Ekperikpe Ekpo respectively, the Special Adviser to the President on Energy, Mrs. Olu Verheijen, the CCE of NUPRC Mr. Gbenga Komolafe, the ACE of NMDPRA Engr. Farouk Ahmed, the ES of NCDMB Engr. Felix Ogbe and the GCEO of Address: Waltersmith Tower, 47 Glover Road, Ikoyi, Lagos, Nigeria Tel. +234 704 562 5700 Website: www.ippg-ng.com 2 NNPC Mallam Mele Kolo Kyari for diligently executing Mr. President’s vision for the industry.

4. Distinguished Ladies and Gentlemen, notwithstanding these laudable policies and the gradual positive turnarounds being experienced, the industry is in dire need of extraordinary focus to mitigate the genuine concerns on its long-term sustainability. Despite our world class hydrocarbon resource base, with over 37 billion barrels of proven crude oil reserves and 207 tcf and 600 tcf of proven and contingent gas reserves respectively, we find ourselves in a situation where our daily production has significantly dropped and lies at a about 1.3 million barrels of oil and 8.5 bcf of gas today. This is way below our capacity as a nation and by all globally acceptable standards, this reserves to production ratio is extremely low and a clear indicator that the industry is in a dire situation. In addition, we now run the risk of partial implementation of our national budget considering an estimated deficit of 400,000 bpd from the forecasted 1.78 million bpd.

5. This trend in production portends another frightening dimension when we consider that in the not-too-distant future our overall installed domestic refining capacity, currently closing in on about 1.2million barrels per day, may soon outstrip our current crude oil production level with the risk of Nigeria finding itself in a position where it is unable to meet its domestic refinery crude demand or even become a net importer of crude oil, God forbid!

6. It is against this scary backdrop that IPPG is calling for urgent measures to be undertaken by all relevant stakeholders to immediately arrest this dwindling production level and under-investment by focusing on the following priority areas:

• Priority Area 1: The immediate conclusion of all pending IOC divestment transactions: IPPG strongly advocates that our member Address: Waltersmith Tower, 47 Glover Road, Ikoyi, Lagos, Nigeria Tel. +234 704 562 5700 Website: www.ippg-ng.com 3 companies – Seplat, the Renaissance Consortium and Oando – have the proven track record to successfully take over and manage these onshore and shallow water assets to realise incremental production in the region of 100,000 – 200,000 barrels of oil and over 1.5bcf of gas per day within 24 months and well over 500,000 barrels of oil per day in the long term. IPPG believes the timely approval of these IOC divestment transactions will also be a clear signal capable of restoring global investor confidence in Nigeria in an era of competing global investment destinations in Africa and very limited access to capital.
• Priority Area 2: The urgent need to address deepwater development and production: Untangling issues around deepwater development, particularly in terms of competitive fiscal regime being negotiated with Shell, Total Energies, ExxonMobil and Chevron, has the potential to unlock incremental production of 700,000 barrels per day from this terrain in the short to medium term. Enabling deepwater development will attract significant economic benefits as Nigeria has one of the world’s largest untapped deepwater resource base.
•  Priority Area 3: The adoption of a national value-retention strategy: Nigeria’s domestic crude oil refining and petrochemical capacity must be sustained primarily from our domestic crude oil and gas production in order to transform our country into a net exporter of refined petroleum and petrochemical products that will lay a strong foundation for the rapid industrialization of the Nigerian economy. It is therefore imperative to grow our daily production to 2.5 million barrels of oil and 10 bcf of gas in the near to long term to ensure we are able to meet our domestic refinery and Address: Waltersmith Tower, 47 Glover Road, Ikoyi, Lagos, Nigeria Tel. +234 704 562 5700 Website: www.ippg-ng.com 4 petrochemical demands and export commitments to generate the muchneeded foreign exchange earnings for macro-economic stability.

• Priority Area 4: The development of Nigeria’s gas resources to catalyse economic growth and complement decarbonisation drive: Nigeria’s vast gas resources must be exploited with immediate focus placed on restoring production to existing installed LNG capacity and expanding production (FLNG). In addition, we must expand domestic gas utilization (Gas-to-Power; Gas-Based Industries) by investing heavily to address the gas infrastructure deficit facing us today. The International Oil Companies will lead the charge on export gas while IPPG members will drive the domestic gas agenda led by NNPCL

7. These priority areas provide the most realistic and sustainable pathway towards meeting our national long term production aspiration of 4 million barrels of oil per day and 13 billion cubic feet of gas per day. Consequently, as a matter of national importance, Nigeria must act fast and hasten the pace of recovery across the entire industry, even if it means Mr. President declaring a state of emergency in the oil and gas sector! We must be seen to do everything possible to unleash the industry. Unlocking this incremental production is achievable only through collaboration and commitment between the industry regulators (NUPRC and NMDPRA) and industry operators (NNPCL, OPTS and IPPG) and this must be done for the sake of our country.

8. Distinguished ladies and gentlemen, as we gather here today, we are reminded of the vital role the industry plays in sustaining the national economy. The theme of this year’s conference; “Showcasing Opportunities, Driving Investment, Meeting Energy Demand” is yet another clarion call for us to collectively confront the challenges and opportunities shaping the energy landscape and we must remain Address: Waltersmith Tower, 47 Glover Road, Ikoyi, Lagos, Nigeria Tel. +234 704 562 5700 Website: www.ippg-ng.com 5 steadfast in our dedication to driving positive change within the energy sector and beyond. With Strategic Policy Makers, Business-Enabling Regulators and Commercially Focused and Socially Responsible operators working in unison towards achieving our shared goal of energy security, I believe we can unlock the full potential of our industry. At this juncture, IPPG re-affirms its continuous commitment and support to the policies of Government, particularly on its quest for energy availability, affordability and energy security for all Nigerians.

9. Your Excellencies, Captains of Industry, Distinguished Ladies and Gentlemen, let me conclude by expressing our gratitude to His Excellency, President Bola Ahmed Tinubu GCFR, for his exceptional support and unwavering commitment in resolving the underlying industry challenges. Secondly, to our Principal Sponsor, NNPCL, under the leadership of its Chairman, Chief Pius Akinyelure, and the GCEO, Mallam Mele Kyari, for once again organising this yearly conference.

10. I thank you for your attention and wish you a pleasurable and engaging time at the 2024 NOG Energy Week.

Abdulrazaq Isa OFR Chairman, IPPG Abuja, 2nd July 2024