Some experts in the oil and development sector have expressed concerns that the country is yet to convert its vast petroleum resources into the economic and social values.

The experts said this in an interview with News Agency of Nigeria (NAN) on Thursday in Abuja, to commemorate Nigeria’s 66th Independence celebration anniversary.

Wumi Iledare, a Professor Emeritus of Petroleum Economics at Louisiana State University, said Nigeria’s oil and gas sector had made significant progress since commercial oil was discovered at Oloibiri in 1956.

Iledare said Nigeria had developed experience in onshore, shallow-water and deepwater operations, alongside indigenous technical capacity, petroleum infrastructure and a substantial natural gas resource base.

According to him, Nigeria still has more than 37 billion barrels of oil and condensate and over 215 trillion cubic feet of natural gas reserves.

He said the Petroleum Industry Act (PIA) had also provided a new institutional and fiscal framework aimed at improving governance, attracting investment and strengthening the commercial orientation of the industry.

Iledare, however, said significant challenges remained, including declining investment, deteriorating production capacity, project delays, rising operating costs, crude oil theft, insecurity and regulatory uncertainty.

He said Nigeria had not consistently produced at the level its resource base and installed capacity could support.

“The more important question is whether Nigeria has converted its petroleum endowment into the economic and social values that should reasonably have been achieved,” he said.

He said that while petroleum had generated government revenue, foreign exchange, employment, infrastructure, technology transfer and business opportunities, the country still had a substantial value-creation gap.

Iledare also identified gas as another area where Nigeria had failed to fully realise its potential.

He said the country’s abundant gas resources remained underutilised because of inadequate infrastructure, weak commercial structures, power-sector constraints and insufficient investment across the gas value chain.

He called for greater investment in gas processing and infrastructure for power generation, liquefied natural gas, fertiliser, petrochemicals, transportation and other industrial uses.

He urged the country to eliminate routine gas flaring.

Iledare said the country needed to create a competitive regulatory and fiscal environment, attract sustained upstream investment, tackle crude theft and production losses, and expand gas infrastructure.

“Producing more barrels is important, but the objective should be maximum economic value per barrel and per unit of gas,” he said.

He also called for petroleum wealth to be translated into sustainable public value through disciplined fiscal management, human-capital development, infrastructure and economic diversification.

“The next phase must be about moving from barrels to value, creating a competitive, investment-friendly petroleum economy that rewards investors, maximising sustainable economic and social welfare for Nigerians,” Iledare said.

An economic expert, Dr Aliyu Illias, said the country had made some progress but had not maximised the opportunities presented by its petroleum resources.

Illias said Nigeria had failed to sufficiently develop its refining and petrochemical capacity in spite decades of oil production.

“By now, we should have more refineries, both private and government-owned.

“We have been in the oil business for over 60 years, but we have not been able to do enough in terms of adding value to our resources,” he said.

He said petroleum had supported the Nigerian economy through government revenues and foreign exchange earnings but had not translated into sufficient improvements in the living standards of citizens.

According to him, Nigeria should use its oil revenues to develop other sectors of the economy and reduce its dependence on petroleum.

He also expressed concerns about the global transition away from fossil fuels.

Illias said Nigeria risked losing opportunities if it failed to maximise its oil and gas resources while the resources remained commercially relevant.

“By now, every state should have its own refinery, and we should be exporting refined products. But we have not been able to activate that potential,” Illias said.

Mr Jide Ojo, a political analyst, said there were several developments that represented progress in Nigeria’s petroleum industry.

Ojo said joint venture arrangements had contributed to the development of the sector and helped increase crude oil production over the years.

According to him, the restructuring of the former Nigerian National Petroleum Corporation (NNPC) into NNPC Ltd. and the separation of the industry into upstream, midstream and downstream brought greater commercial orientation to the sector.

Ojo further said the Dangote Refinery was one of the major developments in Nigeria’s energy sector.

He said the refinery had reduced the country’s dependence on imported refined petroleum products and increased the availability of locally refined products.

“Unlike when we had to import virtually all refined petroleum products from abroad, we are now able to source most refined petroleum products from the local market,” he said.

He attributed the development of compressed natural gas (CNG) as part of efforts to diversify Nigeria’s energy mix and reduce dependence on petrol.

Ojo said in spite of these developments, Nigeria still faced serious challenges in the petroleum sector.

He expressed concerns about the performance of the country’s government-owned refineries.

“Billions of dollars were committed to rehabilitation efforts without the expected results.

“Nigeria’s dependence on imported petroleum products had placed pressure on consumers and the wider economy,” he said.

Ojo also said price volatility, pipeline vandalism, crude oil theft, illegal refining, inadequate transparency and corruption were persistent problems in the sector.

“There is still a lot of opacity in the sector. There is still a lot of corruption, and there is also the challenge of price volatility. We have not achieved stability in petroleum pricing,” he said.

He said that pipeline vandalism and oil theft continued to undermine production and government revenue in spite efforts to protect oil infrastructure.

He also expressed concern about the impact of oil exploration and production on host communities.

He said some communities in the Niger Delta continued to suffer from oil spills, environmental degradation and inadequate access to clean water.

Ojo decried the slow pace of environmental remediation in areas affected by decades of oil pollution, including Ogoniland.

According to him, oil-producing communities are yet to fully realise the benefits promised under the Petroleum Industry Act.

He called for greater transparency and accountability in the management of funds allocated to the petroleum sector, particularly funds meant for the rehabilitation and maintenance of government-owned refineries.