NLNG MD Believes FG’s Executive Order on Oil and Gas will Stimulate Gas Investments
The Managing Director and Chief Executive Officer of Nigeria LNG Limited (NLNG), Dr. Philip Mshelbila, has expressed confidence in the recent Executive Order on Oil and Gas Reforms signed by President Bola Ahmed Tinubu (GCFR), stating that it will significantly boost investments in the gas sector, particularly in unlocking the potential of non-associated gas (NAG) in Nigeria.
Dr. Mshelbila highlighted the importance of this action in driving domestic gas utilization and ensuring a steady gas supply for NLNG’s Train 7 expansion project.
In an interview on the Global Business Report program on Arise Television, Dr. Mshelbila emphasized the substantial impact of the Executive Order on the gas industry, explaining that it will provide incentives for much-needed investments and address specific challenges hindering business ease and investment attraction in the oil and gas sector.
He noted Nigeria’s significant gas reserves, accounting for about 38% of Africa’s total, but highlighted the disparity with only 5% of investment attracted to the oil and gas sector. The Executive Order targets fiscal aspects not covered by existing laws like the Petroleum Industry Act (PIA), particularly focusing on Dry Gas or Non-Associated Gas (NAG).
Dr. Mshelbila elaborated on the obstacles in developing NAG fields, citing the absence of revenue from associated liquids such as oil or condensate. The Executive Order introduces tax credits for the initial ten years of NAG project development, followed by tax allowances, aimed at enabling investors to recoup their investments. This incentive is anticipated to unlock investments in NAG fields that have been previously untapped due to financial barriers.
Regarding NLNG’s Train 7 project, he mentioned its progress at 60% completion, stressing the significance of gas supply and how the Executive Order will streamline gas supply to the project.
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Dr. Philip Mshelbila also highlighted NLNG’s proactive efforts in domesticating LPG supply since 2022 and its dedication to supporting infrastructure development for propane usage in transportation, power generation, and industrial sectors.
NLNG holds a pivotal position in Nigeria’s energy landscape and remains competitive globally in the LNG market, contributing significantly to the nation’s economic development.
