Energy Transition: NEITI warns of significant impact on Nigeria’s oil revenue

The Nigeria Extractive Industries Transparency Initiative, NEITI, on Tuesday, cautioned that the global push for transition to cleaner energy would have major impact on Nigeria’s economy and revenue accruing to the government from the petroleum industry.

NEITI therefore urged the government to speed up the ongoing reforms in the Nigerian extractive sector and the diversification of the economy.

Speaking at a methodology workshop on a study to measure the long-term impact of energy transition on Nigeria’s economy in Abuja, the Executive Secretary, NEITI, Dr Orji Ogbonnaya Orji warned that with revenue from oil and gas dropping by 15% between 2022 and 2023, push for energy transition would further put pressure on government revenue.

According to him, “the world is moving rapidly towards clean energy, and while this transition presents opportunities, it also poses significant risks to resource-dependent economies like ours. Nigeria, as an oil-dependent nation, must act decisively to manage these risks while positioning itself strategically to harness the opportunities.

“Energy transition seeks a global shift away from fossil fuels to renewable sources of energy. This global shift will require sustaining the ongoing reforms of the extractive industries which is at heart of the work of NEITI”.

Also speaking, the Alternate Chair, NEITI National Stakeholders Working Group (Board), Amb. Adoli Mathew observed that the transition from fossil fuels to cleaner, renewable energy sources is no longer an abstract concept.

He pointed out that “it is a reality shaping policies, markets, and investment decisions worldwide. For Nigeria, an oil- dependent economy, this presents profound challenges and opportunities”.

Adoli noted that Nigeria’s “ability to navigate this transition effectively will determine not only the future of our energy sector but also the overall sustainability of our economy”.

On her part, the representative of civil societies on the NEITI board, Dr. Erisa Danladi, while noting that for Nigeria, energy transition presents both opportunities and challenges, added “it offers the potential for economic diversification, innovation, and job creation, it also raises concerns about revenue stability, energy access, and social equity, especially for the most vulnerable populations”.

Danladi stated that the “methodology workshop is an essential step in ensuring that the study’s outcomes are grounded in robust research, comprehensive stakeholder engagement, and actionable insights. The findings will not only inform Nigeria’s policy direction but also serve as a reference point for other resource-rich nations navigating similar transitions”.

The study would be conducted by Dr Friday Ohuche with the outcome expected next year.

Source: https://www.vanguardngr.com/2024/11/energy-transition-neiti-warns-of-significant-impact-on-nigerias-oil-revenue/

Date: 27Nov24