The Founding Managing Director of Niger Delta Exploration and Production (NDEP) Plc, Dr. Layi Fatona, has emphasised the need to address funding challenges being suffered by oil and gas operators in Nigeria arising from lack of long-term capital borrowing for investments in the sector.
Fatona, said over the years the available capital borrowing window in the sector has largely been for the short-term. This, he said does not encourage oil and gas industry development, stating that there was need for dialogue amongst the relevant stakeholders to address the situation.
The petroleum expert made the call recently during the virtual session organised by the Nigerian Association of Petroleum Explorationists (NAPE) with the theme: “Impact of COVID-19 on the Nigerian Oil and Gas Sector-Challenges and Opportunities.”
The session particularly looked into the negative impact of the pandemic on operators and businesses in the oil and gas industry and how they can meet their financial obligations in a period when there is growing difficult and a strained existence in the industry across the entire value chain.
According to Fatona, “There has to be a framework for dialogue– dialogue for capital, because in this country there is no long-term money, absolutely.
“All the capital you have in this country are talking about very short-term capital. “Borrowing money for five years, investing in the oil and gas development, you think five years is a long time but absolutely it is not.
“And I think this is one of the major things that this country has to address and it has to be addressed not just by the practitioners as business people – the banks, the central bank, regulators, all have to come in to address.”
On what entrepreneurs in the industry could do to surmount the challenges posed by COVID-19, he advised that they should embrace high level discipline and right attitude to the situation, adding that as business concerns, discipline should be a dominant guide in meeting their obligations.
Fatona added: “First and foremost, it is very important for everybody to appreciate that whether it is oil and gas, whether it is buying and selling of cement, whether it is building homes, owning farms or whatever; as long as we see whatever we are doing as business, that we be guided by certain rules of existence, then, we would start to appreciate better the discipline that is required to guarantee success in anything that we do.”