The Chief Executive, Nigerian Upstream Petroleum Regulatory Commission, Gbenga Komolafe, says the impact of energy transition has made it mandatory for oil sector operators to develop innovative measures to mitigate its effect.

He spoke at the Energy Year Nigeria 2023 Book Launch and Awards Ceremony in Lagos, according to a statement that he signed.

Komolafe said, “We can also optimise the value chain of our crude oil by developing our domestic refining capacity with multiplying effect on the midstream derivatives.

“The derivatives include the petrochemical industry, methanol, ammonia production and LPG that will spur the industrial base and improve revenue for economic development.

He said Africa’s industrialisation capacity was weak due to its energy gap and low midstream derivatives and feedstock for industrial development, and that, “an economy with low industrialisation is a weak economy.”

The NUPRC boss stated that an innovative approach for funding fossil fuel development in the Nigerian upstream sector had become more compelling now than ever as a mitigation measure against the onslaught of the energy transition

He said, “Alternative funding mechanism must be sought and pursued vigorously to assuage the effect of de-funding of fossil fuel.

“Such mechanisms could include pre-export financing, project financing, oil for service agreements and prioritisation of gas development being the adopted transition fuel.

“Furthermore, attention must be on ways to increase production at reduced unit cost by leveraging improved drilling techniques, enhancing oil recovery and improving oil recovery methods should be leveraged.”

He also outlined others to include continuous data gathering and studies to optimise discovery requirements, as this should be pursued to reduce the chances of failure and downtime during drilling.

Komolafe pointed out that the adoption of advanced technologies was crucial in transforming the upstream sector, improving production and delivering benefits to government and investors.