Investment Opportunities in Oil and Gas Sector

Foreign and domestic investors are being encouraged through improved fiscal incentives in the Nigerian oil and gas sector. In the Upstream and Downstream sectors, the following are some of the areas where there are

Upstream Activities

  • Petroleum Exploration and Exploitation
  • Search for development of local substitute for such items as Medium pressure valve, pumps, shallow drilling equipment, Drilling mud, bits fitfings, drilling cements etc. 
  • Manufacturing of consumable materials in exploration suc as explosives, detonators, steel castings, magnetic tapes etc.
  • Other areas in the services sector of the upstream are
    • Construcfion and Installation
    • Maintenance
    • Pipelining
    • Well Services and
    • Transportation Support Services

Downsteam Activities

  • Domestic Production and marketing of Liquefied Petroleum Gas (LPG)
  • Manufacturing of LPG cylinders, valves and regulators, installation Of filing plants, Retail distribution and development of simple, flexible and much less expensive gas bumer to encourage the use of gas instead of wood and other fuels.
  • Establishment of processing plants and industries for:
    1. The production of refined mineral oil, petroleum jelly and grease
    2. The manufacture of bituminous based water/damp-proof building materials such as roofing sheets, floor files, rubber products, tarpaulin
    3. Building of ashphalt storage, packaging and blending plants to handle the product for export.
  • Establishment of chemical industries such as distillation units for the production of naphtha and other special boiling point solvents used in plant and food processing industries.
  • Establishment of industries for processing Linear Alkyl Benzene, Carbon Black and Polypropylene.
  • Development of Phase 11 (Phase III to 'oin later) of Nigeria's Petrochemical Programme.
  • Participation in all phases of the Nigerian Gas Industry de,,tlopment programme from exploration, gathering, production and processing to transmission.
  • Establishment of small scale industries to produce chemicals and Solvents, for example Chlorinated methane, Formaldehyde, Acetylene, etc., from natural gas
Refining: One condition for purchasing Nigerian Crude Oil is the ownership of an efficient refenery. The shelter which the domestic petroleum products market enjoy , almost completely seals the prospects and viability of privately financed refinery for locally consume petroleum products. However, opportunities exist for the construction of a refinery in bonded premises with adequate export facilities for dedication to the export market. Companies with the technological know-how can undertake turn-around maintenance of refineries. Refineries consume a lot of utilize a broad range of spare parts. There tremendous scope for small scale joint ventures manufacturing concerns with foreign techical partners. Such ventures can start warehousing arrangements that will ensure continuity of supply at competitive prices. Other investment opportunities contingent upon refining and Aucillary activities are the manufacture of special products such as: 
  • Industrial and food grade solvents
  • Insecticides
  • Cosmetics
  • Mineral Oil, petroleum jelly grease
  • Bituminous-based water/damp-proof building materials such as floor tiles, rubber products, tarpaulin, etc., and
  • Asphalt storage, packaging and blending plants to handle products for export and local use. Export of refined products surplus also exits as an opportunity.
Products Marketing: Petroleum Product Marketing would seen scaled with hardly any opportunity except by way of establishing an independent marketing outfit or aspiring to establish an independent marketing outfit or asparing to establsih dealership with the marketers.

While indeed those opportunities remain viable, far more challenging opportunity may be explored in the areas of product transportation, by road and coastal tankers. 

Associated with the product distribution and marketing is a chain of manufacturing and maintenance businesses such as lubricating oil processing, LPG bottles and accessories, oil cans reconditioning, etc. The nations pipeline and deport network constist of 3001 km of pipeline of varying sizes as sixteen storage depots. These pipelines and networks travers the length and breath of the country. The system therefore must be maintained in a healthy state for effective and efficient distribution of products.

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