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V.A.L.O.R V alue A dded LO cal content R educes cost: Creating a Strategic competitive advantage for Nigerias Oil & Gas Industry through stakeholder Collaboration Emeka C. Ene PETAN March 3rd, 2016 Global Oil Supply > Global Oil

  1. V.A.L.O.R V alue A dded LO cal content R educes cost: Creating a Strategic competitive advantage for Nigeria’s Oil & Gas Industry through stakeholder Collaboration Emeka C. Ene PETAN March 3rd, 2016

  2. “Global Oil Supply > Global Oil Demand” – EIA Short-term Global Energy Outlook 2016

  4. IRANIAN & LIBYAN OIL? Will Geopolitics alone save the situation? SHALE OIL DISRUPTION WEAK GLOBAL ECONOMY

  5. Oil Prices goes beyond the Geopolitics!

  6. Oil#Price#(US$)# [Source:#OPEC]# 120.00# 100.00# 80.00# 60.00# 40.00# 20.00# 0.00# 2004# 2006# 2008# 2010# 2012# 2014# 2016# NIGERIA'EXCESS'CRUDE'ACCOUNT'(ECA)/SWF'(B$)' Source:'World'Bank','IMF,'Nigerian'Govt.' 12" 10" Nigeria? 8" 6" 4" No Savings during 2" the Boom Cycle! 0" 2012" 2013" 2014" 2015" ECA/SWF"(B$)"

  7. Rig-count Middle East | Rig-count Nigeria Source: OPEC

  8. …Resulting in decline in exploration activity, reserves & production! Exploration wells & Discoveries (source: DPR)

  9. “We cannot build an (oil) economy where corruption is the working capital - Muhammadu Buhari ”

  11. “…Industry-wide Collaboration is CRITICAL to rescue the situation”

  12. 3-Cs of Collaboration • Cost reduction industry-wide • Capture Value-Added Local Content (not Rent collection) • Cluster to solve industry challenges

  13. Cost reduction should be industry-wide COLLABORATE TO ELIMINATE SYSTEMIC COSTS

  14. DEVELOPMENT FINDING COSTS High COSTS systemic Costs $/BBL INFRASTRUCTURE OPEX COSTS COSTS Source: Jojarth: Estimating Average Production Costs of Oil Fields ; EIA

  15. Capture Value-Added Local Content NOT RENT COLLECTION!

  16. Local Content Value destruction

  17. LOCAL CONTENT @30$ OIL PRICE!

  18. Collaboration between Nigerian companies will reduce project costs Source: Weltek’s Fabrication of a Methanol Skid for Shell’s Bonga deepwater project

  19. PETAN IN NUMBERS ★ Nigerian-based Industry advocacy trade association. ★ 85 Nigerian Oil Service Companies. ★ 250 Technical Services. ★ Employment: 20,000+ ★ Collateral employment:90,000+

  20. Cluster to solve common industry challenges

  21. 4 Critical Industry Challenges -SUSTAINING LOW COST OIL PRODUCTION -STRANDED GAS-TO- MARKET -SUFFICIENCY OF PETROLEUM PRODUCTS -SECURITY

  22. Sustainable oil production Value- added local content knowhow retention 20,000+ jobs Source: George Osodi; Delta Nigeria – The Rape of Paradise

  23. Stranded Gas modular gas plants Gas for power Source: George Osodi; Delta Nigeria – The Rape of Paradise

  24. Sufficient petroleum products • modular refineries Gas powered • transport Regional supply security Source: George Osodi; Delta Nigeria – The Rape of Paradise

  25. Security pipeline monitoring technology Eliminate +10% oil losses Source: George Osodi; Delta Nigeria – The Rape of Paradise

  26. • SEPLAT: 300 MMSCF/Day • SEPLAT: 550 MMSCF by 2017 • NDEP: Modular refinery & Gas Stranded Gas plant Solutions • FRONTIER/7E: 120 MMSCF/Day • XENERGI: Only independent Gas fractionating Plant in Nigeria

  27. 25,000 bpd modular refinery 12 months - design to commissioning 60 days on-site installation 
 Potential Quick-win in a Low oil price environment!

  28. REAL-TIME PIPELINE MONITORING TECHNOLOGY DEPLOYED IN THE NIGER_DELTA

  29. A reed never becom et an iroko tree by ds eaming African proverb

  30. THANK YOU @eneemeka

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