The Managing Director of ANOH Gas Processing Company Limited, Engr. Effiong Okon has stressed the urgent need for technology and strategy to work hand in hand in the gas sector.
At the ongoing 2025 Nigeria Annual International Conference and Exhibition, organised by the Nigeria council of the Society of Petroleum Engineers, in Lagos, Okon, who highlighted the opportunities and challenges in Nigeria’s oil and gas supply chain landscape, said: ‘Nigeria is not a very competitive landscape business wise for our industry — our unit technical costs, unit development cost and unit operating expenditure are quite high, ranging from $10 to $40/barrel of oil equivalent’.
According to him, in a low oil and gas price environment, most Nigerian assets would not be economic to attract investments in the form of equity or debt or any form of funding. ‘From reservoir to export/market, inventory, logistics, and transportation represent one of the largest cost areas. The question investors now ask is simple: how strong are your environment, social and governance scores in support of responsible and sustainable investment? Because this determines how much capital you can attract into your business’.
Okon explained that the deployment of innovative technologies such as just-in-time inventory systems could significantly reduce costs, while supporting sustainability targets and operational excellence. He explained: ‘Using technology to drive the supply chain can have a very big impact in terms of cost competitiveness, and at the same time, you reduce your carbon intensity, supporting sustainability goals while keeping your business profitable’.
Okon stressed that involving the supply chain very early in our business processes is very critical to achieving success, start early from ideation, feasibility assessment, concept select, pre-FEED (Front End Engineering Design), etc. all the way through to tendering and contract awards was essential. ‘Once you build technology into your supply chain, you can make the right decisions that drive competitiveness and efficiency’, he observed.
Drawing a contrast between multibillion-dollar International Oil Companies (IoCs) projects and the small-to-medium Nigerian indigenous or independents, Okon underscored the importance of scale, saying: ‘On one hand, you have $5 to $20 billion projects in the IoCs; on the other, independents managing projects of just $100 to 200 million annually. You really can’t apply the same global practices directly. But technology gives us the tools to adapt — whether through block chain, automating procurement, integrating robotics into vendor selection, or using digital contracting systems to drive transparency’.
He also pointed out some challenges in Nigeria’s contracting space, where interference from all sources often undermines efficiency. ‘That’s why we believe building a digital, end-to-end contracting system is critical. As the saying goes, what you can’t see, you can’t measure or improve. That visibility is what drives efficiency’, he said.
Turning to Nigeria’s operational environment, Okon recalled a time when the country was one of the most cost-efficient producers globally.
‘In the early 1990s, Shell and other IoCs were producing at just $2–$3 per barrel, with production in the Shell East hitting 500,000 barrels of oil per day (bopd) and the Shell West over 500,000 bopd as well, leading to Nigeria producing over two million bopd comfortably at very low cost. But once insecurity escalated, we started doubling down on security spending. Today, each time you operate in the Niger Delta, you may need to mobilise an entire trailer load of soldiers and police. That’s where the costs balloon’, he explained.
He warned that without addressing insecurity, inefficiency, and community relations, Nigeria’s competitiveness would remain undermined. Okon cautioned: ‘In the Middle East or Gulf of Mexico, operators don’t face this kind of burden. Until we resolve it, we cannot bring our technical costs under control’.
Okon was quick to emphasise that technology alone is not enough. He said: ‘Strategy is equally critical. Take Tullow Oil, which saw its market capitalization fall from $20 billion in 2010 to under $300 million today. Tullow Oil, which was brilliant in exploration but struggled to transition into production. This industry is unforgiving when strategy and technology are not aligned’.
The ANOH Gas chief challenged Nigerians to focus on practical, home-grown solutions or adapt imported models to the country’s unique or peculiar challenges.
‘We have to start creating solutions right here at home. For example, in AGPC ANOH plant design, there will be no routine flaring and the heat from the gas turbine exhaust at 400degC will be used for plant boiler and other heating requirements. The assets and the problems are before us, we just need innovative thinking to solve them’. he said.
He also shared advice for the younger generation: ‘I often tell young people who want to be billionaires that it’s not just about chasing money. It’s about identifying the problem you want to solve first. The wealth follows from solving real challenges’.
On a note of optimism about Africa’s future, he said: ‘With our growing population, massive industrialisation is coming, and with it, a rapidly increasing demand for energy. The opportunity to shape that future with technology-driven solutions is right in front of us.
‘We have to believe in our country, Nigeria and the African content, the potentials are enormous and must be unleashed for future generations to strive. The AGPC investment model in the midstream gas business, with huge growth potential for the future, is one of such steps toward actualization of this ambition’.
