The Chief Executive Officer (CEO) of TotalEnergies, Patrick Pouyanne, has explained why the company is investing a whooping sum of $6 billion in energy projects in Angola over Nigeria.
Pouyanne, who spoke with panellists of the Africa CEO in Kigali, Rwanda, said the inconsistency in policymaking decisions led to the diversion of the project from Nigeria to Angola, a country with a more stable policy framework.
The oil boss stated that although the Niger Delta is the most productive region in West Africa, the erratic policy environment has made investment untenable.
He added that TotalEnergies has not conducted oil exploration in the region for 12 years.
“Nigeria loves to open topics without closing them. You love to debate. There is always a new legislature in Nigeria about a new petroleum law. When you have such permanent debates, it’s difficult for investors looking for long-term structure to know what direction to go.
“In reality, the Niger Delta is the most prolific part of West Africa. But if you look at what happened, because of these debates, there has not been a single exploration in Nigeria for 12 years.
“It’s important to have a debate and then settle it and put a framework on the table that investors can trust.
“We have countries that have perfectly integrated policies like Angola. So, we go to Angola and announced a very large $6 billion projects in the beginning of the week because there their framework is stable. So we know where we go,” Pouyanne said.
Insecurity, lack of talent stifling investment
In addition, Pouyanne said that insecurity and the lack of human capital are two of the main issues facing investment in the country.
According to him, investors need the guarantee that their investments are secured and not exposed to violence and demolition.
He also added that the firm is training individuals to boost human capital and required talents needed in the oil and gas sector.
“What are the challenges? Security comes first. For a CEO like me, security of my people is of utmost important. Fortunately, we have customs in the Niger Delta to deal with it.
“We also have finding talent has a difficulty. In some countries like Nigeria and Rwanda, we find difficult to find talent. Some of them have difficulty in education. And we can contribute to that. That’s some of the things we do, training people,” he said.
What you should know
In December 2023, TotalEnergies said it would invest as much as $6 billion in Africa’s biggest oil producer in the years ahead.
The energy firm said it will target deep-water projects and gas production at a time when international oil companies (IOCs) are shifting attention away from onshore to offshore operations in Nigeria.
Pouyanne had told President Bola Tinubu during a meeting in Abuja that the French company is in support of the current administration’s policies and push to resolve insecurity issues in the industry.
Nigeria contributes eight to 10% of TotalEnergies’ global output and is home to more than 18 per cent of its overall investments.
However, the company has been finding it difficult to get the oil major to retain its interest in offshore assets, which has been problematic for IOCs because of their vulnerability to insecurity and vandalism.
In February, Nairametrics reported that the firm announced plans to sell its minority stake in a major Nigerian oil joint venture.
The firm said It wants to divest its share of Shell Petroleum Development Company of Nigeria Limited (SPDC) and is looking to reshape its portfolio since producing oil in the Niger Delta is not in line with its health, security and environmental policies.
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