As the global shift from fossil fuels mounts, the African Refiners and Distributors Association (ARDA) is concerned that funding, totaling over $160 billion (N67.118 trillion), for oil projects is threatened in Nigeria.
ARDA stated this during its Work Group Workshop Series on HSE & Quality, noting, “Indeed, over $160 billion projects are currently under financial threat in Nigeria’s upstream oil sector even as the Organization of Petroleum Exporting Countries (OPEC) said oil nations might find it difficult to raise over $12.6 trillion needed for oil and gas investment before 2045.”
This hurdle is coming at a time when reports show that Nigeria and other African refiners would require $15.7bn (N6.585tr) to upgrade existing refineries to produce cleaner AFRI 6 fuels which have less sulfur content.
Already, the continent is facing huge refining, storage and supply deficits, ARDA noted.
Speaking on the ‘Implications of ESG Standards on Global Oil & Gas Project Financing’, the Executive Secretary of ARDA, Anibor Kragha, said attracting funding to Nigeria and other African oil-producing countries may become tougher without strong consideration for emissions reduction, social development and governance.
Kragha insisted that investors must now demonstrate how their HSE and Corporate Social Responsibility (CSR) practices contribute to return on investment and business performance.
He said: “COVID-19 and the war in Ukraine have more than ever highlighted the need for refining petroleum products in Africa.
“We can’t expand our capacity without finance. For us to get sustainable finance we must prioritize HSE.”
The Executive Chairman of Energy & Natural Resource Security Inc (ENRS), Derek Campbell, said Nigeria and other countries have more to worry about on the security of energy infrastructure, especially with the spate of vandalism.
Campbell sees Energy Security Risk & Resiliency Assessments (ESRRAs) as a practice that countries must now prioritize to avert growing dangers to critical energy infrastructure.