According to Wale Tinubu, CEO of Oando PLC, Nigeria’s foremost indigenous oilfield services company and fuel distributor, the firm’s plan to realize a production target of 100,000 barrels of oil per day within the next four years is already “fully funded.” Oando made headlines in May when it announced the completion of a $150 million, two-year drilling contract with Nigerian Agip Oil Company (NAOC)–the local division of the Italian firm–for its oilfields in the Niger Delta swamps.
As per the ever-volatile oil price, Tinubu predicts $75 by year’s end. He also anticipates an imminent “big shake-up,” in the form of market reforms and deregulation, of the country’s energy industry. The government announced in February that it planned to end subsidies on petroleum products because it could no longer sustain the more than $4.4 billion (one quarter of its original 2008 budget) a year that it spends on subsidies. As it currently stands, Nigeria is the world’s eighth-largest crude oil exporter; yet it imports an appreciable amount of its needed petroleum given the rotten state of its four domestic refineries. Accordingly, state officials would like to deregulate the downstream oil sector and privatise its refineries, which would open the way for investors to restore, and indeed increase, existing capacity.