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REALITIES OF GLOBAL RESPONSE TO OIL MARKET SUPPLIES The question of whether OPEC has contributed to the uncertainty in oil prices- which has now become a constant feature of international oil prices- will be given more than a passing comment in this article. OPEC is the sovereign body or cartel which was established in 1960 to promote the interest of its member oil-producers. The role of OPEC over time may not have been one which is generally appreciated across academic discourse especially in the field of petroleum economics, but it is one that offers an insight as to the extent to which oil-producer nations can galvanize themselves into a formidable block which will hold its own at all times.
Not surprisingly, environmental lobby group Greenpeace was quick to condemn this week's award to BP of four new petroleum exploration permits off Australia's southern coast, even going so far as to label the move "some kind of sick joke."
One of today’s largest global challenges is the production of energy. The need for clean or green energy and new technologies is ever increasing. There are social, environmental and political pressures. Despite all these pressures, one force that stands out is the topic of energy security. Energy security has no clear-cut definition; I like to define it as logistically securing the amount of energy we need to keep the lights on and the cars moving tomorrow.
As the world’s demand for oil increases, so does the search for more sources of oil by oil and gas companies. In today’s highly competitive oil and gas industry, over 80% of the global spending on deepwater projects is going to take place within the golden triangle off the deepwaters, which is made up of West Africa, Deep Water Gulf of Mexico and off the coast of Brazil (Gue, 2009).
In Nigeria, the estimated growth rate in the demand for white products (PMS, DPK & AGO) is 5% per annum. Therefore, if current demand of 15.24 Million MTPA (Metric Tonnes Per Annum) is projected to 2015, it will result in a 2015 demand of 19.45 Million MTPA. If the existing refineries were able to achieve 63% of nameplate capacity and double production to 8.36 Million MTPA, the supply gap in 2015 would remain unchanged at 11.09 Million MTPA. If regional demand is taken into consideration, then the refining capacity will have to be increased.[1] A Greenfield Refinery Project has been proposed to be built at the Lekki Free trade zone in Lagos, Nigeria and will cost about US$5 Billion.[2] It is my objective to show through this article that an additional refinery capacity can be economically and financially viable; while pointing out that government must have clear-cut goals and objectives in eliminating all distortions- in order to ensure continuity, efficiency and profitability.
Corporate Culture, Governance, Risk and Stakeholders
