Nigeria Archives

August 16, 2022

As an official partner for AEW 2022, a delegation from the Nigerian Association of Petroleum Explorationists will drive important discussions around how Africa can modernize oil and gas upstream operations

JOHANNESBURG, South Africa, August 16, 2022/APO Group/ — The African Energy Chamber (AEC) is proud to announce that the Nigerian Association of Petroleum Explorationists (NAPE) has become an official partner of the African Energy Week (AEW) (AECWeek.com) conference and exhibition, Africa’s premier event for the oil and gas sector which will take place from 18 – 21 October 2022, in Cape Town.

Representing the largest professional association of petroleum geologists, geophysicists, Chief Executive Officers, consultants and academia in Nigeria – one of Africa’s largest hydrocarbon producers – having NAPE as an official partner of the continent’s biggest energy event is critical for shaping discussions around current trends, challenges and opportunities across both the Nigerian and continent’s oil and gas upstream sector.

With the partnership, conversations during the event will be centered around exploration and production, with insight into how African countries can improve capacity building

Since its establishment in 1975, NAPE has played a critical role in fostering interaction between Nigerian, African and international oil and gas professionals, promoting industry growth by sharing and encouraging the adoption of best practices, business models and standards. With Nigeria seeking to increase oil and gas production to address domestic energy security issues while boosting the monetization of hydrocarbons to drive GDP and economic growth, organizations such as NAPE are critical for driving local content development and ensuring innovative and next-generation end to end workflow solutions are implemented to optimize operations across the African E&P sector.

In this regard, with targets to increase Nigeria’s proven gas reserves from 200 trillion cubic feet (tcf) to 600 tcf for domestic utilization and export – as the energy transition intensifies and the global gas market expands – organizations such as NAPE will be key, up-skilling the domestic workforce and creating a competitive market in-country.

At AEW 2022, NAPE representatives will participate in high-level meetings and panel discussions to shape dialogues around how African countries can accelerate hydrocarbons exploration and production, thereby increasing socioeconomic development while lifting the over 600 million people across the continent out of energy poverty. In addition, with global energy transition-related policies hindering the flow of investments required to optimize oil and gas exploration, representatives from NAPE are well positioned to drive AEW 2022 discussions around best practices and technologies for Africa to attract investment, maximize the development of hydrocarbons while remaining a climate champion.

“The Chamber is honored to partner with NAPE for AEW 2022. With the partnership, conversations during the event will be centered around exploration and production, with insight into how African countries can improve capacity building and skills transfer provided. We believe that drilling more oil and gas wells are key to ending energy poverty in Africa and having modern geosciences and practices is vital for addressing challenges and kickstarting development. This very narrative will be driven at AEW 2022 with the help of NAPE,” states NJ Ayuk, the Executive Chairman of the AEC.

Under the theme, ‘Exploring and Investing in Africa’s Energy Future while Driving an Enabling Environment,’ AEW 2022 will host NAPE representatives in various forums and keynote sessions on how Africa can modernize its oil and gas workforce whilst ensuring gender diversity and inclusivity. As an official partner of AEW 2022, NAPE will shape powerful discussions around local content development across Africa’s oil and gas sector as well as effective technical approaches to addressing industry challenges.

Distributed by APO Group on behalf of African Energy Week (AEW).

July 7, 2022

Organized by cybersecurity platform Diary of Hackers and its team of volunteers, the conference took place at the Nile University of Nigeria, Abuja

HONG KONG, Hong Kong, July 6, 2022/APO Group/ —

TECNO Security Response Center (SRC) (https://bit.ly/3yIN0X1) recently reaffirmed its dedication to cybersecurity at the Cyber Starters Conference 2022 (https://CyberStartersConference.com/) as its only esteemed Gold Sponsor. It marks TECNO’s first sponsorship of Africa’s largest annual cybersecurity event for beginners since its establishment last year.

Organized by cybersecurity platform Diary of Hackers and its team of volunteers, the conference took place at the Nile University of Nigeria, Abuja. A watch party was held concurrently over Zoom at Wennovation Hub, Victoria Island, Lagos.

“The Emergence of Cyber Workforce”: A Conference By Africans, For Africans

More than 700 attendees had the opportunity to connect with cybersecurity professionals and learn from their expertise during lightning talks and panel discussions tailored to support individuals interested in breaking into the cybersecurity industry.

“This conference has empowered many passionate individuals who want to make a difference in Africa’s cybersecurity scene. As our cybersecurity community grows in size and expertise, we can expect a massive ripple effect of the conference throughout Nigeria and the rest of Africa,” the Diary of Hackers representative remarked on the significance of the event.

As digital crimes become more sophisticated, TECNO wants to empower every African smartphone user to navigate cyber threats effectively

TECNO Commits to Safe Mobile Experience for All African Users

Nigerian cybersecurity professionals can submit security vulnerabilities through TECNO SRC. Their contributions will build on its extensive bug bounty program, promoting a higher level of product security amongst African users.

Besides working with experts, TECNO SRC supports Nigerian universities in cultivating cybersecurity talent. Such partnerships are integral in developing a vibrant cybersecurity ecosystem in Africa today and for future generations.

“As digital crimes become more sophisticated, TECNO wants to empower every African smartphone user to navigate cyber threats effectively. We look forward to working even more closely with white hat professionals and enthusiasts to strengthen the African cybersecurity landscape and achieve greater milestones in safeguarding our African users,” TECNO SRC representative stated.

Established in 2021, TECNO SRC is a platform for cooperation and exchanges between TECNO and security industry experts, researchers and organizations. TECNO SRC aims to cooperate with vulnerability public testing platforms worldwide and offer its users in over 70 markets the ultimate secure mobile experience.

Distributed by APO Group on behalf of TECNO Mobile.

June 27, 2022

The award was presented to Cellulant Nigeria by Communication Week Media Limited, the publisher of Nigeria Communications Week

LAGOS, Nigeria, June 24, 2022/APO Group/ –Cellulant (www.Cellulant.io) , Africa’s leading payments company, was recognised as the Payment Platform Solutions Provider of the Year in Nigeria at the 13th Beacon of ICT Awards 2022.

This award is a recognition of Cellulant’s work in providing a payments platform that focuses on driving merchant business and digital payments for local, regional and global merchants in the continent and digitising both online and offline payments. Renowned businesses such as Emirates, GIG logistics, Coldstone, Bolt, Dominos and Ethiopian Airlines to name a few, have partnered with Cellulant to use their Tingg digital payments solution as a single collection gateway in Nigeria.

Cellulant simplified their product, unifying their offering into Tingg (http://Tingg.africa/) – a digital payments platform that addresses the complex needs of managing different payment channels for a business. This has made it easy for businesses to conveniently and affordably accept payments from a single integration. Customers can make payments for goods and services using locally relevant payment options.

Founded in 2003, Cellulant has more than 18 years of experience providing locally-relevant payment solutions for businesses and their consumers. Its evolution over the years, from a digital content business to mobile banking and now to payments, has allowed the company to build an expansive network, strong relationships and partnerships.

The award was presented to Cellulant Nigeria by Communication Week Media Limited, the publisher of Nigeria Communications Week. The annual event recognises leading players in the ICT sector in Nigeria whose outstanding achievements contribute to the industry’s growth. The theme of the Awards Ceremony was “Impact of Blockchain Technology in a Digitalized Nigeria”.

Cellulant (https://www.Cellulant.io/) provides a unified, single-contract, and single API payments platform – named Tingg- that makes it easy for businesses to receive and make payments; while allowing anyone to pay from their mobile money, local and international cards or directly from their bank.

Today, Cellulant has an office presence in 18 countries, including Nigeria, with a payments platform connecting thousands of businesses with 257 payment options across 35 countries. The platform powers payments for 200 million consumers on a single inclusive network for interoperability across Africa.

Speaking on the recognition, Opeyemi Fowler, Cellulant’s Head of Enterprise Sales stated “the digital payments landscape in Nigeria and Africa is evolving rapidly with differing payment channels such as card, mobile money, bank transfer and cash – with volatile currency fluctuations and no single settlement framework. This is creating a highly fragmented landscape for businesses whose customers increasingly request to pay for their purchases using digital payment options. Every day, our job at Cellulant is to work with our customers and partners to solve this fragmentation in payments.”

“This award is a testament to our work in providing a payments platform that is transforming the way people do business in Nigeria and beyond; and a reflection of the hard work done by our people.”

Distributed by APO Group on behalf of Cellulant.

June 24, 2022

LAGOS, Nigeria, June 23, 2022/APO Group/ –PAC Capital Limited (PACCapitalLtd.com), the investment banking arm of PanAfrican Capital Holdings successfully raised US$300 Million funding from the African Export-Import Bank (“Afreximbank”) on behalf of Titan Trust Bank (“TTB”) to support the acquisition of majority stake in Union Bank Plc, Nigeria (“UBN”).

PAC Capital’s Managing Director, Humphrey Oriakhi, made this known in a statement shortly after the deal was sealed.

Humphrey said “Specifically, the arranged funding completed the funds required for the acquisition.”

PAC Capital Limited is the Investment Banking and Advisory arm of PanAfricanCapital Holdings, with an excellent track record of successful fundraising and financial advisory services across Aviation, Financial Services, Telecommunications, Power & Energy, Oil & Gas, Agro-Allied and Hospitality sectors in Nigeria and beyond.

“PAC Capital Limited played a vital role in arranging part of the acquisition consideration for this landmark transaction of TTB acquiring majority stake in UBN. We sincerely thank PAC Capital and Afreximbank for supporting the deal with the highest professionalism and efficiency,” said Mudassir Amray, the former MD of Titan Trust Bank and now MD/CEO of Union Bank.

“The financing was closed in a record timeline,” Mudassir added.

It is expected that this acquisition will enhance the competitive dynamics of the Nigerian banking sector while maintaining confidence in Nigeria’s financial services industry and broader financial stability. The development impact of the acquisition as stated by Afreximbank is immense as TTB plans to leverage the merged entity to provide financing of about US$3 Billion over the medium term of which over US$600 Million will directly support intra-regional trade finance.

The investment banking firm was awarded the “Best Investment Banking and Advisory Firm Nigeria 2022” (https://bit.ly/3OBMXBu) by the World Business Outlook Awards shortly after the landmark deal was closed.

Distributed by APO Group on behalf of PAC Capital Limited.

May 18, 2022

While I am deeply honored, humbled and grateful for all the incredible goodwill, kindness, and confidence, my current responsibilities at this time do not allow me to accept to be considered

ABIDJAN, Ivory Coast, May 17, 2022/APO Group/ —

Statement by Dr. Akinwumi A. Adesina, President, African Development Bank (www.AfDB.org):

I have been extremely humbled by several calls from Nigerians at home and abroad that I should consider running for the office of the President of the Federal Republic of Nigeria.

I am very touched by all who have gone to great extent, with such huge sacrifices, of their own volition, to consider me worthy to be proposed for potential consideration. The coalition groups of youth, women, farmers, physically challenged and well-meaning Nigerians that have done this have expressed their genuine free will, political right, freedom of expression and association for my consideration, with the interest of Nigeria at heart.

While I am deeply honored, humbled and grateful for all the incredible goodwill, kindness, and confidence, my current responsibilities at this time do not allow me to accept to be considered.

I remain fully engaged and committed to the mission that Nigeria, Africa and all the non-African shareholders of the African Development Bank have given me for Africa’s development.

I remain fully focused on the mission of supporting the accelerated development and economic integration of Africa.

May God bless the Federal Republic of Nigeria.

May God bless Africa.

Dr. Akinwumi A. Adesina

May 4, 2022

The program, “Pay-As-You-Go Tractor Financing for Increased Agricultural Productivity in Nigeria,” already has enabled tractor purchases in the states of Nasarrawa, Abuja and Enugu

ABUJA, Nigeria, May 4, 2022/APO Group/ —

Seeking innovative ways to generate agribusiness opportunities for young African entrepreneurs, Heifer International (www.Heifer.org) has announced that it is investing $1 million USD in the tractor booking platform, Hello Tractor, to provide loans for tractor purchases—loans that can be repaid from revenues earned by leasing them to local farmers.

The program, “Pay-As-You-Go (PAYG) Tractor Financing for Increased Agricultural Productivity in Nigeria,” already has enabled tractor purchases in the states of Nasarrawa, Abuja and Enugu. These purchases could make tractors accessible to thousands of smallholder farmers via the increasingly popular Hello Tractor leasing platform. Sometimes referred to as Uber for tractors, Hello Tractor offers software and tracking devices that allow farmers to book tractor services from local tractor owners via a mobile phone app.

“The Pay-As-You-Go model provides financing for entrepreneurs who want to create jobs by capitalizing on the demand for tractor services on Africa farms, but who lack traditional forms of collateral,” said Adesuwa Ifedi, Senior Vice President of Africa Programs at Heifer International. “It’s a way to unlock capital for youth who have strong business skills that can help transform African agriculture but are often overlooked by private equity investors.”

Globally there are roughly 200 tractors per 100 square kilometers of agriculture lands, but in sub-Saharan Africa, there are only about 27. This is illustrative of a mechanization deficit that has a significant impact on farm productivity and local economies in a region where most people depend on smallholder farming for income. Hello Tractor is one of many new agritech start-ups emerging across the continent that are finding business opportunities in addressing this and other farming challenges. However, while private equity groups and large impact investors have provided more than $5 billion for tech startups in Africa, very little of that financing has gone to young agritech entrepreneurs.

Ifedi noted that Heifer International is stepping into the breach to demonstrate the potential of agritech investments to generate jobs for the ten and twelve million young people enter the workforce every year in Africa– and in an economy that, according to the African Development Bank, generates only three million formal jobs annually.

In 2021, Heifer International created the AYuTe Africa Challenge, which awards cash grants annually to the most promising young agritech innovators across Africa. It also supports Heifer’s goal of helping more than six million African farmers earn a sustainable living income by 2030.

The inaugural AYuTe Africa Challenge awarded a total of $1.5 million USD to two companies, one of which was Hello Tractor. The award allowed Hello Tractor to finance 17 tractors for 17 entrepreneurs in three countries. Heifer’s new investments announced today for the company’s PAYG product will give more entrepreneurs and smallholder farmers access to tractor services at an affordable rate. And that in turn can boost farm productivity, employment, food security and farmer livelihoods.

“We developed the PAYG program to make tractor ownership—and the reliable income these machines can bring—a reality for entrepreneurs who find it impossible to get credit through normal channels,” said Jehiel Oliver, founder and CEO of Hello Tractor. “We look at the revenue tractor owners can generate, not how much collateral they can pledge.”

Oliver said that partnering with Heifer “enables us to extend innovative financing to people who were previously considered ‘unbankable,’ while increasing access to technology that has the potential to improve the incomes of millions of smallholder farmers across Africa.”

Ifedi and Oliver first made the announcement on April 28 with leaders of the country’s Federal Ministry of Agriculture and Rural development, State Ministries of Agriculture, key government officials, private sector leaders, and top media executives to showcase agripreneurs participating in the PAYG program. The event highlighted the progress of smallholder farmers who have benefited from the increased access to tractor services.

January 22, 2022

DPO offers merchant aggregation services to over 60,000 active merchants, including eCommerce companies, airlines and travel agents

LAGOS, Nigeria, January 21, 2022/ — One Payment Limited, a subsidiary of the leading Pan-African digital payments group, DPO Group (https://DPOGroup.com) has been granted a license by the Central Bank of Nigeria to provide certain types of payments services to businesses across Nigeria.

This license enables the DPO Group to operate as an independent payment solutions services company in Nigeria as it does across over 20 other countries in Africa. DPO offers merchant aggregation services to over 60,000 active merchants, including eCommerce companies, airlines and travel agents.

Local and global businesses trust DPO Group because its robust and reliable network allows merchants to accept payments in the currency of their choice. Working across local and international channels, DPO also offers strong protection against fraud and helps merchants manage refunds, chargebacks and more.

eCommerce has seen significant growth in Nigeria in recent years, due to high levels of internet penetration combined with being one of the largest digital economies on the continent. Digital payments make up the large majority of payment volumes in the country, and volumes are expected to reach 7.7bn by 2025, representing a growth of 45% from 2019. [1]

Eran Feinstein, CEO of DPO Group, commented, “Nigeria represents a key market for any business with a digital focus, as one of the most innovative African countries when it comes to fintech and eCommerce. This new license is an exciting development which will allow us to offer an even smoother payment process for Nigerian businesses looking to grow and reach more customers through secure digital payments.”

DPO Group was acquired by Network International in 2021 in a landmark deal for the African payments space. It continues to operate under the same brand in existing territories, and will be launching a new comprehensive payment solution, ‘DPO Pay’ for businesses across Africa and other territories.

DPO’s country manager in Nigeria – Chidinma Aroyewun said, “This license provides an exciting opportunity for us at DPO. It allows us to work with tens of thousands of Nigerian businesses and help them achieve their growth goals through secure payment technology.”

January 19, 2022

Periculum helps its banking and lending customers identify fraud risk, assess creditworthiness, and analyze existing data

LAGOS, Nigeria, January 17, 2022 — The availability of domestic credit is a key requirement for consistent economic growth in developing countries. The vitality of financial services such as banking, savings, debt and equity financing, investment management, and point-of-sale lending is largely dependent on the maturity of its domestic credit industry. Nigeria’s domestic credit market pales in comparison to similar countries of the same size. For context, credit to the private sector in Nigeria is about 12 percent of GDP, lower than South Africa’s 129 percent and Malaysia’s 134 percent. High ratios of credit to the private sector in these countries have helped to ramp up real sector growth, create innovative innovation possibilities for technology-enabled businesses, accelerate financial development, ensure the efficient functioning of the economy and guarantee the prosperity of the private sector.

The Central Bank of Nigeria (CBN) and other development partners including the Bank of Industry (BoI), the Bank of Agriculture (BoA), among others have embarked on significant credit injections to support the critical sectors of the economy, but the paucity of credit assessment infrastructure ensures many potential borrowers are denied access to loans, and when they do, they can be charged as much as triple the base interest rate. This financial exclusion has significant outcomes for the real sector as lack of access to credit can be a disincentive to entrepreneurship, investment, and economic growth.

Canadian fintech startup and credit assessment company, Periculum, has launched in Nigeria to tackle the challenge of domestic credit to the underserved markets. Focused on improving financial inclusion in emerging markets through automated credit assessment tools that close the consumer credit gap and help financial institutions provide credit facilities to the financially excluded while making smarter decisions, Periculum officially launched its financial service product offerings at a media interaction today.

Speaking at the launch, Michael Temitope Collins, Periculum’s founder and Chief Executive Officer, said “Africa needs domestic credit to stimulate real economic growth. And this is not only bank-to-business credit; it can also be digital lending for short-term credit as well as “buy now, pay later” schemes. The absence of tech-enabled credit assessment infrastructure has limited the quality and quantity of lending and may be behind the risk premiums borrowers have to pay, and the harassment practiced by predatory lenders in countries like Nigeria. Periculum will change that. We are a top provider of data analytics and credit assessment services targeted explicitly to underserved markets. We help our customers to reduce their lengthy loan application processing times and loan default rates and offer loans to the underbanked and unbanked consumers as well as micro, small and medium-scale enterprises. With reliable, tech-enabled, credit assessment services, financial institutions can increase lending to those that need credit.”

The company has also announced the appointment of a Managing Director, Damilola Aluede, to accelerate its business in Nigeria.

Founded in 2019, Periculum helps its banking and lending customers identify fraud risk, assess creditworthiness, and analyze existing data. Periculum offers real-time decision-making, analysis, and credit underwriting solutions to financial institutions including banks, non-banking financial companies, and fintech companies. By providing information on the financial worthiness of customers and automating the loan decision process, Periculum’s customers can gather and analyze borrower information and assign a credit score faster, with real outcomes on financial inclusion in Nigeria and other markets.

https://www.periculum.io/media/

Periculum offers data aggregation APIs and platform solutions that aggregate data from partners including open banking APIs and the credit bureaus, to provide complete financial and data profiles of prospective borrowers and third-party entities. Some of its clients include Fundii, Lendaba, Sycamore, Golden Ox Partners, Vola Africa and Venero.

On its product roadmap and current services, Collins added “We offer services that include Credit model development, SMS data aggregation and analysis, financial data analysis, and other data analytic solutions. We can help our customers with solutions such as fraud detection, insights for lenders based on customer segmentation and customer lifecycle value, insights to retailers and ATM operators, and several other benefits”.

The startup was accepted into Techstars in 2021 and is among the 2021 Techstars Montréal AI cohort, as well as the Founder Institutes’ Select Portfolio. In October 2021, Periculum raised a $620,000 pre-seed funding round to help it expand its team, improve product development and scale its operations in Nigeria and other markets. The company currently delivers services to customers in Canada and Nigeria and plans to expand to Ghana, Kenya, and Egypt before the end of 2022.

For many countries in Africa, there is still a financial divide. By tackling the credit assessment challenge, Periculum can build the financial infrastructure that helps in addressing the issue of access to financial services and improves development outcomes for millions of people, with better opportunities for businesses, financial institutions, and lenders.

Distributed by APO Group on behalf of Periculum.

December 23, 2021

The release of this flagship report aims to bridge the gap between these two complimentary industries by investigating and assessing the role of Nigerian pension funds in empowering local investors in Nigeria’s private equity industry

LONDON, United Kingdom, December 14, 2021/ — The African Private Equity and Venture Capital Association (AVCA) (www.AVCA-africa.org) and the Pension Fund Operators Association of Nigeria (PenOp) are pleased to release the first ever report on Nigerian Pension funds engagement with private equity. The report incorporates responses from Nigeria’s leading pension fund managers, exploring their interest and perception of private equity as an asset class.

Nigeria’s pension fund industry has grown at an impressive CAGR of 18% over the last five years, culminating in an asset base of ₦12.3 trillion (US$29.9 billion) as at December 31st, 2020. Although there has been a concerted effort by both sets of industries to increase the level of pension allocation to private equity, the allocation of Nigeria’s pension funds to the asset class has traditionally been low when compared to their allowable limits. The release of this flagship report aims to bridge the gap between these two complimentary industries by investigating and assessing the role of Nigerian pension funds in empowering local investors in Nigeria’s private equity industry.

The Pension Funds and Private Equity in Nigeria Report finds that Nigerian pension funds display a strong appetite for private equity investment both locally and across the continent. 75% of the pension fund managers that participated in the survey plan to accelerate or maintain their current pace of capital commitments to African PE in the next five years, citing a desire for portfolio Diversification and Performance as the most important factors driving their investment plans.

The report also catalogues some of the obstacles faced by pension funds investing in the asset class. Respondents highlighted a perceived weak exit climate and a limited number of established African GPs as significant challenges for pension funds investing in African private equity. However, 49% of survey participants did not consider any of the current pension investment regulations to be prohibitive, suggesting that respondents view the existing regulatory environment as conducive for investment in alternative asset classes.

Speaking on the publication, the CEO of AVCA, Abi Mustapha- Maduakor, said “Increasing interest in Africa’s private equity industry from domestic and international investors alike underscores the need to analyse the perceptions and concerns of institutional investors to promote an open dialogue on the continent’s unique business environment. This joint publication exemplifies AVCA’s commitment to championing private investment in Africa: bridging the knowledge gap between industry stakeholders by providing topical, informative research on the opportunities private equity has to offer Nigerian pension funds.”

Oguche Agudah, the CEO of PenOp said “Local pension funds have expressed a desire to increase their allocation to private equity and more impactful investments. However, there are a number of bottlenecks that restrict them. The partnership with AVCA helps us to work with industry stakeholders to identify and address these bottlenecks for our mutual benefit, and the benefit of the local economy”.

Download the report here (https://bit.ly/3m2MtZk)

Distributed by APO Group on behalf of African Private Equity and Venture Capital Association (AVCA).

December 22, 2021

Marginal field development has also allowed indigenous companies to step out from oil majors’ shadow and thrive

JOHANNESBURG, South Africa, December 13, 2021/ — By NJ Ayuk, Chairman, African Energy Chamber

Nigerian energy-industry leaders have been reminiscing lately about the country’s earliest efforts to develop marginal oil and gas fields. That’s because after nearly two decades, Nigeria recently stepped up its marginal-field development efforts, a wise move that I hope other countries will follow.

Marginal oil and gas fields are sites with reported reserves and production potential that have been left unattended for at least 10 years from the date of their discovery. In most cases, these fields are sites where international oil companies (IOCs) discovered oil or gas deposits and received the rights to move forward with production–but then, for any number of reasons, decided against further activity. In the 1990s, Nigeria began wondering if the IOCs’ losses in these cases could be turned around to generate revenue for government coffers — and opportunities for local oil and gas companies. In 2003, after devoting significant time to relevant policy development, Nigeria launched bidding for the rights to develop 24 marginal fields. Marginal field licenses went to 31 indigenous companies.

Some will point to the fact that only 13 of the awarded fields are now producing and argue that the effort fell short of expectations. They’ll cite technological limitations that impeded indigenous companies’ effectiveness.
While those setbacks did occur, Nigeria’s decision to develop marginal fields produced plenty of benefits, too. As I wrote in my book, “Billions at Play: The Future of African Energy and Doing Deals,” the bidding round gave more than 30 local companies an opportunity to establish themselves and develop their capacities as upstream operators. And, it allowed them to do so without assuming the risks (or the costs) of exploration, since all of the fields designated as marginal were confirmed discoveries.

What’s more, the producing fields have been generating revenue, about 2% of total daily production in Nigeria. And as more marginal fields are developed, they will increase Nigeria’s domestic production capacity even more.
That’s why I was pleased to see Nigeria launch another marginal field bidding round in 2020. In some ways, this latest bidding round is even more important than the first. African oil- and gas-producing countries are still reeling from COVID-19 and dealing with mounting global pressure to transition away from fossil fuels. And they’re facing these obstacles at a time when they still need their oil and gas industries to generate revenue, to help ease energy poverty, and to help stimulate economic growth and diversification.

The challenges facing our energy sector, and the vital importance of fighting to keep it alive and well, are addressed in depth in the African Energy Chamber’s recently released report, The State of African Energy 2022, now available on energychamber.org. The report also explores the opportunities available to African oil- and gas-producing states — including marginal oil and gas field development.
While there are no easy fixes for Africa’s energy industry challenges, developing marginal fields is a valuable strategy that can yield tangible benefits for the countries that embrace it. And the time to embrace it is now.

COVID-19’s Lingering Symptoms
Around the globe, the COVID-19 pandemic has spread its nasty tentacles into nearly every aspect of our existence. Not only has it been wiping out lives, but the pandemic has also been crushing economies and exacerbating poverty in developing countries. The pandemic’s economic devastation has been particularly acute in sub-Saharan Africa: The region’s economy is projected to grow by only 3.7% this year. This is the slowest pace of growth in the world, according to the International Monetary Fund (IMF), which attributes sub-Saharan Africa’s lagging growth to slow vaccine rollouts and policy differences.

For Africa, where so many countries rely on oil and gas exports for revenue, COVID-19’s impact on our energy sector remains a major concern. In 2020, lockdowns set off a chain reaction of reduced demand for oil, plunging prices, and a long list of canceled and postponed oil and gas projects. As of late 2021, IOCs’ capital expenditures in Africa have yet to reach pre-pandemic levels.
Now add to the equation climate concerns and the immense pressure IOCs are facing to stop investing in African oil and gas projects.

“COVID-19 and the subsequent disruption to global markets is estimated to have wiped out close to US150 billion of exploration and development expenditure from Africa between 2020 to 2025,” the Chamber’s energy outlook states. “Over the last 12 – 15 months, more companies and especially majors have announced strategic revisions with increased focus on the energy transition, cutting down their carbon emissions and in doing so, reduce respective upstream expenditure going forward. While 2021 is expected to see marginally higher upstream investment totaling just over US33 billion in Africa, the estimated drop in African upstream expenditure over the years 2022 – 2025 is close to US34 billion when compared to the estimates from year-end 2020.”

What does that mean? African states must do everything within their power to breathe life into their oil and gas industries — immediately.

Marginal Fields Have Proven Benefits
That brings us back to Nigeria — and the promise marginal fields hold for the African continent.
As I’ve said, I’m convinced earlier bidding rounds have already produced significant benefits for Nigeria. Look at the infrastructure that local marginal players were able to build, like the 48-kilometer pipeline from Egbeoma to Kwale owned by Platform Petroleum Limited and Newcross Petroleum.

Marginal field development has also allowed indigenous companies to step out from oil majors’ shadow and thrive. Strong Nigerian operators like AMNI Petroleum, Shoreline Energy, Aiteo, Neconde Energy, Waltersmith Petroman, Yinka Folawiyo Petroleum Company, Eroton, Amni International, Seplat Petroleum, Atlas Petroleum, FIRST E&P, Sahara, Belema Oil and many others can attribute their successes, at least in part, to their marginal field experiences.

It’s also worth mentioning that several Nigerian marginal fields were recognized under the UN Clean Development Mechanism for successfully reducing gas flaring and valorization of natural gas.
During Nigeria’s latest marginal field bidding round, 591 companies applied to develop 57 oil fields, according to Sarki Auwalu, Head of the Department of Petroleum Resources. Ultimately, Nigeria awarded oilfield development rights to 50% of the 161 companies that were shortlisted after demonstrating that they met all conditions for approval. As of March 2021, Nigeria expected the awards to provide $600 million in income. In today’s challenging environment, that’s a notable accomplishment.

Also working in Nigeria’s favor is the recently passed Petroleum Industry Act (PIA) a legislation designed to bolster the country’s energy industry. The market-driven PIA incentivizes global investments in Nigerian oil and gas projects by promoting greater government transparency, eliminating red tape, and revamping tax and royalty requirements. It also specifically addresses marginal field development: For example, the PIA makes provisions for marginal fields operators to receive a specific type of license, and it closes gaps in existing law regarding the legal status of marginal fields.

Together, the PIB and marginal-field development represent a real chance for Nigeria’s energy industry to get back on its feet and better meet pressing domestic needs, from providing more Nigerians with reliable electricity to generating the revenue necessary to grow and diversify the economy.

And, marginal field development is not limited to Nigeria. Successes there have led additional African-producing states, including Angola, Congo-Brazzaville, South Sudan, and Gabon, to follow suit. I encourage others to do the same. If you’re an African leader today, every decision, every move you make with the potential to impact your energy industry, has to count. It only makes sense to embrace tactics with proven benefits — and marginal field development definitely falls into that category.

Distributed by APO Group on behalf of African Energy Chamber.

Older Posts

Nigerian Association of Petroleum Explorationists (NAPE) becomes Official Partner of African Energy Week 2022

TECNO Security Response Center Empowers Cybersecurity Enthusiasts at Cyber Starters Conference 2022

Cellulant Recognised as a Leading Payment Platform Solutions Provider in Nigeria for its Tingg Platform

CORRECTION: PAC Capital Limited Closes Landmark Deal for Titan Trust Bank in the Nigerian Banking Industry

Statement by Dr. Akinwumi A. Adesina, President, African Development Bank

Hello Tractor, Heifer International Unveil Pay-As-You-Go Tractor Financing for Agripreneurs in Nigeria

DPO Group granted regulatory license to provide payments services in Nigeria

Canadian fintech Periculum, officially launches in Nigeria, set to build credit assessment infrastructure for Africa

AVCA and PenOp Launch Inaugural Report on Pension Funds and Private Equity Investment in Nigeria

Following Nigeria’s Example: Developing Marginal Fields Is More Important Than Ever for Africa (By NJ Ayuk)