‘Beyond regulation, Nigeria has too many oil, gas assets locked up’

Lekan Akinyanmi is the CEO of Lekoil, an Africa-focused, AIM-listed oil and gas exploration and production company with interests in Nigeria and Namibia. The company acquired a significant stake in the Otakikpo marginal field from Green Energy and acts as its technical partner to bring the field into production. In this interview, Akinyanmi explained how the slow pace of Nigeria’s regulatory approvals is impeding the company’s ambitions having raised $200million to explore the field with P50 reserves estimate of 770 mmboe. FEMI ADEKOYA writes.
How would you assess Nigeria’s oil and gas industry?
My assessment is that we are making progress but still operating below capacity; we can do much better than we are doing. If you look at the resource base that we have and compare it to the production, you will see we are producing below capacity.

However, there are a lot of positives. This is one area in the world where you have been able to develop and train people, we can operate at any level whether it is legal, financial, technical, we have had the skill set over many decades in Nigeria.

It is considered one of the main staples so any international oil company that is truly global, has operations in Nigeria. But if you look at where we are, compared to where we should be, we have quite a long way to go.

Would you say the country is delivering on its potential vis-à-vis the current production capacity?
Right now, we are below 2 million barrels per day (mbpd). We are probably about 1.7 mbpd but we should be at 4 mbpd given our base. Let’s even say the investments required to get us to 4 mbpd is quite substantial. At the very least, we should be at 2.5 million barrels per day.

In my opinion, the reason is that we have a lot of assets that are locked up. I used to be an investor in Wall Street and I put a lot of money in Nigeria at that time and this is one place that I know you have a lot of assets that have been proven but for one reason or the other, they are not available to local and international companies.
But if these assets are opened, do you think we really have the capacity to take them to production?
When you talk about capacity, you are looking at the industry broadly, so it is not only Nigerians that will do the work. There will be people from outside the country. It is always good to have a balance. As indigenous companies, we like the idea of the Nigerian Content Development and Monitoring Board (NCDMB) driving Nigerian ownership but at the end of the day, there’s also a value in diversity.

In an organisation, if we were all from the same background, our thought processes are the same, then we can miss things. We all grew up from what I like to call an unstructured background; it is also good to have people that grew up in a different background, where everything is structured. They may not necessarily be good entrepreneurs as we are, but they may be good at getting things done consistently. So, you need to mix those two to get the best.

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