ASSESSING THE TOP ELEVEN CHALLENGES FACING THE EXPLORATION AND PRODUCTION INDUSTRY IN NIGERIA: A REVIEW

Okorie E. Agwu, Julius U. Akpabio, Moses G. Akpabio

Abstract: The Exploration and Production (E and P) industry is one complex industry characteristically coloured with boundless risk limits and occasioned by humongous capital requirements which more often than not are scarce in nature. This paper brings to the fore the various challenges that have confronted the E and P industry in Nigeria and the ways the industry has been affected. The top eleven challenges were isolated and discussed to find a common ground in order to bridge existing solution gaps. The choice of the top eleven challenges was in itself a challenge because of the wide spectrum from which to choose - from the very basic to the very complex. To achieve this, data from secondary sources were collected and analyzed using a descriptive approach. An organization of the final list shows that the challenges include four titles on oil facilities, three titles for each of uncertainty and the environment, two titles each of technology, people and government policy and one title for each of demand and insecurity. Two factors were observed to impact negatively on the industry namely; the uncertainty in getting at the oil itself and the uncertainty in the price of oil at a given time. In all, it is observed that revenue decline lies at the heart of the challenge map. However, for each challenge, existing approaches to solving them are presented and useful tips are suggested as to how to improve on the existing solutions. These suggestions are learnings tapped from other areas of the globe where they have proven successful. The ideas presented in this paper if utilized would help indigenous, service companies and the multinational companies involved in the oil & gas business in Nigeria to stay afloat especially at times that oil prices are plummeting.

Keywords: Challenges, E&P Industry, Oil prices, Uncertainty

DOI: https://doi.org/10.15623/ijret.2016.0506038