Kyari: Why Nigeria Must Balance Financial, Energy Security

Mele Kyari
Mallam Mele Kyari

Peter Uzoho

The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kyari has said Nigeria will not be cowed to jettison oil and gas, the nation’s chief revenue earner, in the rush to achieve cleaner and sustainable energy.

According to the NNPC boss, Nigeria must strike a balance between achieving financial security, a critical driver of the nation’s survival as well as energy security and sustainability.

The GMD said this yesterday in Lagos, during his keynote address at the 2021 Energy Sustainability Conference (ESC) organised by the Energy Institute Nigeria, with the theme, “Accelerating Sustainable Energy Solutions through Policy Implementation: Prospects and Limitations.”

Represented at the event by the Group General Manager, National Petroleum Investment Management Services (NAPIMS), an arm of the NNPC, Mr. Bala Wunti, Kyari noted that such a balance was necessary considering the fact that Nigeria depends largely on income from oil and gas.

While pointing out that oil and gas make up about 65 to 70 per cent of the country’s revenue and almost 85 to 90 per cent of the foreign exchange (forex) coming to Nigeria, Kyari said it would be unwise for the country to abandon its main source of revenue just to achieve cleaner or sustainable energy.

He said, “We also know that oil and gas underpin our revenue, underpin our forex. Are we ready to exit 65 to 70 per cent of our revenue coming from oil and gas? Almost 85 to 90 per cent of our forex comes from oil and gas.

“Is Nigeria ready, because they want to have sustainable energy, cleaner energy, abandon this resource that we have and move to other ones?

“I think the solution is not to abandon them but to quickly monetise them and use the money to invest in other sectors, including cleaner and sustainable energy, so that we can have a credible replacement without compromising our financial security.

“So the balance between financial security and energy security is a very critical national issue. I don’t think there is any country in the world that will push you to the level where you create instability because you don’t have the critical revenue,” he explained.

He said with Nigeria’s 200 million population and the need to cater to their well being, it was important that policy makers try to put all factors including the peculiarities of countries into consideration while formulating the energy transition policy.

Kyari said while the developed and industrialised countries, who are the largest carbon emitting countries were calling for an end to fossil fuel, they were yet to tell the world how the world energy demand that is projected to balloon in the future would be met.

He stated that the policy of sustainability of energy must be decentralised, because what would work for other climes may not work for Africa.

The world’s population, according to the recent report by the World Bank, stands at about 7.7 billion people while global Gross Domestic Product (GDP) stood at $85 trillion.

Kyari pointed out that global energy consumption was in the neighbourhood of 3.1kwh, saying with the growing economic activities in the world, it was clear that energy demand was going to grow, a situation he said, called for a reflection on where the energy would be coming from.

According to the GMD, the world currently consumes 27terabites of electricity and would double by 2050 to about 54.

“Now, the question is, where is this energy going to come from? This energy is going to come from a variety of sources, and the debate and the cordial invitation for all of us is that we would try to do what we call clean energy, sustainable energy, which are all wonderful.

“We all want clean energy. Now, while trying to keep our eyes on making sure that we have sustainable energy, we also have to keep our eyes on making sure that we ensure our country’s energy security.

“Definition of energy security is around what we call the four As. That energy must be available to all and sundry, that energy must be accessed by everybody – accessibility is key; that energy must be affordable, if it is not affordable, then it’s no longer available to me; and that energy finally, must be in an acceptable format and fashion,” he said.

According to him, looking at all the four quadrants that constitute what energy security was, and the need to make it cleaner, presents a challenge for policy makers.
He, however, stated that the corporation was not averse to transition as it was already diversifying its portfolio, adding, “We need to bring everything to use -solar, wind, oil, gas, whatever we can, to make sure we achieve reasonable development through energy prosperity.