In his welcome address at OTL Africa Downstream Week, Chairman, Emeka Akabogu asserted that for the past twelve years the event has set agenda for petroleum business, policy and competition. Driven by the industry and endorsed by government, OTL Africa Downstream has created a rare platform to come together as an industry to review relevant operations, practices, procedures, policies and laws. This gathering gives operators the opportunity to gain new insights, forge new partnerships, showcase brands, products and services and align operations to suit emerging industry dynamics.
According to Akabogu, “In doing this over the last eleven years, we have witnessed a quantum shift in the profile of operators in the downstream petroleum industry towards a place of increased relevance, visibility, organisation and strategic positioning. For this, we are very proud of our role and that of the supporting industry movement occasioned thereby.”
The Chairman pointed out clearly that global economic challenges have fuelled renewed urgency among Africa’s downstream operators to diversify operations in order to maximize the sector’s potential. This renewed consciousness has resulted in significant investment in key elements of the value chain, indicating a paradigm shift that emphasizes technological evolution, capacity development, supply chain efficiency and value addition. This is replicated across the continent with investments being ramped up in Ghana, Kenya, South Africa, Rwanda, Nigeria and a host of other African countries. Based on this premise, Africa’s oil and gas industry is at a threshold of sweeping changes to the structure of the downstream industry.
Akabogu was of the view that in Nigeria, recent market tendencies have shown appetite for some categories of investment in the downstream value chain. There has been considerable investments in retail outlet development, marine logistics platforms and storage facilities across the country, while several refinery projects that aim to balance the discrepancy caused by inadequate refining capacity on the continent are currently underway. Other emerging developments, issues bordering on regulation of the industry and independence of the regulators themselves have also received the attention of stakeholders.
However, policy development and implementation have not kept pace with the urgency of industry needs and the appetite of market operators.
Nonetheless across the continent, there is no doubt that there is huge potential which is now poised for realisation.
Akabogu noted that the African market remains one of the highest growth regions in the world with consumption witnessing year-on-year increase. Operators within the continent’s key regions realise this and are keen on exploring all opportunities.
The theme for 2018 event is “Unlocking Value for Industry Synergy”. With the clear realisation that patronage-based markets are not sustainable and that the future lies in opening of petroleum markets to price and value competition, the most important challenge to operators will be capacity to compete at the highest level. Capacity is no doubt enhanced by synergy through focus on areas of strength.
The OTL Chairman advocated for industry cooperation which has become necessary at both private and government levels. The theme of the event gave room for discussions on the range of emerging opportunities inherent in the downstream value-chain which have hitherto witnessed sub-optimal focus.
According to Akabogu, government engagement with industry is always crucial not only for mutual engagement in facilitation of seamless industry operations, but ensuring the very legitimacy of governments, administrations and tenures. Governments at the highest levels can never be too busy to engage with industry and must prioritise opportunities for optimal promotion of actual and perceived harmony between policy and operations. “We must therefore commend those governments which have taken out time and effort to optimise their representation at the events. Particular commendation goes to the governments, national and sub-national including key regulatory agencies, Akabogu added.”
The event empowered African oil and gas companies to harness economic potential of the downstream sector in areas ranging from crude oil value addition to refining, to development of critical supply infrastructure across African States.
Issues that were discussed include prospects for refining in Africa, finance for downstream trading and infrastructure projects, regional cooperation, mergers, takeovers among others. Discussions were also focused on the sector’s disruptive influences, rising profile and application of Liquefied Petroleum Gas (LPG) across the continent, as well as renewable energy.