Our General Manager of Operations, Busayo Fabunmi, on Thursday, 5th October, joined a session panel at the 2023 National Association of Energy Correspondents (NAEC) conference to share his insight on the topic, “Energy Transition, PIA, Petroleum Pricing and the Way Forward for the Downstream Sector”.
Here are some of the key points he raised during the conversation.
Petroleum Act Overhaul: On this, he said the Petroleum Act (PIA) 2021 is a significant and audacious attempt to revamp the petroleum industry, indicating a major shift in the regulatory framework.
Free Float Pricing: As a leader in the market, he advocated for allowing petroleum product prices to float freely in the market, comparing them to commodities. This approach, he said, would introduce some fluctuations, but it could attract investors who see these variations as investment opportunities, fostering industry growth.
Emphasis on Gas Transition: The PIA places considerable emphasis on energy transition, particularly regarding the use of Compressed Natural Gas (CNG), he said. In his view, this is an advantage, which aligns with the changing energy consumption patterns observed in various sectors, including transportation and the emergence of gas as a bunker fuel in ocean-going vessels.
Cost Savings with CNG: He mentioned that our company, Asiko Energy Limited conducted analysed and compared fleets of trucks running on diesel with those using CNG and found significant cost savings with CNG. This experience prompted the company to consider further investments in CNG adoption.
LNG Expansion: He also mentioned that Asiko Energy is expanding its presence in the LNG (Liquefied Natural Gas) space. This expansion includes investments in an LPG terminal and a focus on increasing gas adoption and penetration in various sectors, like transportation and power.
Market Growth in LPG: Fabunmi mentioned a substantial growth in LPG (Liquefied Petroleum Gas) consumption over the past five years, except for a temporary dip in the previous year. He foresees significant market growth in LPG.
Importance of Regulatory Oversight: He emphasised the role of regulatory bodies like NUPRC and NMDPRA, established under the PIA, to provide proper oversight in specific areas of the gas industry.
Optimizing Gas Production: Fabunmi highlighted the need to maximize gas production in Nigeria and make it available for diverse businesses to use for energy and CNG applications. He believes there is room for significant growth in gas consumption to drive down costs and improve margins for various industries.
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