THE recent disclosure by Delta State Commissioner for Oil and Gas, Hon. Peter Uviejitobor, of the state’s readiness to boost investment in the petroleum resources sector is indeed a welcome development, considering Delta’s prime position as one of the largest oil producing states in the country.
Presently, Delta State produces about 30 per cent of the country’s total oil and gas which accounts for a significant amount of current foreign exchange earnings of Nigeria. Crude oil occurs in most of the local government areas in the state and the offshore locations are around Escravos and Forcados. The state government over the years hasbeen proactive in developing the oil sector by providing infrastructure and attracting investments.
The oil sector contributes to the economic development and stability of the nation, as revenue from Oil alone accounts for 40 percent of the country’s GDP, 70 percent of budget revenue and 95 percent of foreign exchange earnings. Attracting the right investment in the oil sector by the government would go a long way in transforming the state economy.The state government initiative is therefore a welcome development as proper harnessing of its abundant oil resources in the marginal fields and untapped deposits in some parts of the state would engender more investment, create employment opportunities, increase the state revenue and ensure energy security.
To fully maximize the benefits of the oil resources, there is an urgent need for the government to put adequate policies in place to attract the right investors. A conducive business environment must be created to inspire investors with the requisite competence and technology to drive further Investment in the sector.The hosting of the 8th National Council on Hydrocarbons (NCH) by the state, as stated by the Commissioner for oil and gas, further demonstrates the rising profile of Delta State as a destination for investors in the industry. We therefore urge the state government to leverage on the meeting to showcase the opportunities available in the state oil sector and put measures in place to ensure ease of doing business in the state.
In order to maintain and sustain a business friendly environment, the government should endeavor to promote a robust relationship between host communities and business organization coming to the state. A friendly and peaceful environment is very crucial for the smooth operation of any business venture, hence we advocate for the development of a comprehensive community engagement template, that will build confidence and forestall any form of dispute between the host communities and potential investors.
Considerable efforts should also be geared towards domestication and effective implementation of the Petroleum Industry Act (PIA), in a bid to enhance dispute resolution mechanism, which is a fundamental aspect of the PIA’s legal framework. The emphasis on alternative dispute resolution mechanism such as arbitration and mediation provide stakeholders with efficient pathways for conflict resolution. Ensuring accessibility and fairness of these mechanisms is essential for bolstering investor confidence and maintaining a conducive business environment.
To spur more investment in the oil sector, we call on the government to explore the Public, Private Partnership (PPP) business option in its drive to boost investment in the state oil sector. This is because apart from putting the right policies in place, the state government’s participation will further motivate investors to commit their resources to the development of the oil sector.
