Consultant to the Senate Committee on Gas, Olabode Sowunmi, has said that Nigeria’s energy sector can only achieve sustainable growth through strategic patience, robust investment, and the strengthening of independent regulatory institutions.

Speaking in an interview with ARISE News on Wednesday, Sowunmi emphasised that true progress in projects like the Bonga oil field, the CNG rollout, and refinery operations depends not just on funding but on systemic reforms and institutional independence.

Sowunmi confirmed that Shell is progressing with its investment in Bonga, one of Nigeria’s largest offshore oil fields, noting that a Final Investment Decision (FID) on Bonga North is expected “in a couple of years.”

“Sometimes we need to understand where we’re coming from so that we can appreciate where we are,” he said, explaining the historical context of the Bonga project. “Bonga started as a production-sharing contract in the 90s, primarily because Nigeria could not afford the joint venture model. The oil companies put in their investments, and when production started, we had to share the output—hence the term ‘production-sharing contract’.”

He highlighted a key oversight in the original agreements. “The contracts were signed for oil and not for gas. A substantial part of the gas that went to NLNG came from Bonga, but because there wasn’t a proper contract for gas, revenue from it could not be accessed by the nation,” he said.

According to him, nearly $1.6 billion was held in escrow until reforms in the Petroleum Industry Act (PIA) and the enactment of new gas laws resolved the issue.

On the impact of Bonga’s investments, Sowunmi stated, “It’s infrastructure-heavy. It takes time—building roads, pipelines, underground wells. But the benefits trickle down. From contractors to food vendors and janitors—yes, even janitors can land million-dollar contracts in the oil and gas industry.”

Sowunmi also addressed questions about the federal government’s push towards Compressed Natural Gas (CNG) as an alternative to petrol. While he described it as a “definite win” for the administration, he cautioned against unrealistic timelines.

“CNG is very much like petrol or diesel. The reason petrol is everywhere is because its infrastructure has been built over 70 to 80 years. That is not the case for CNG. The infrastructure, value chain, and supply chain will not be nationwide in three to five years—perhaps not even in ten.”

He urged patience and commitment to the process. “It’s not about technological difficulty, it’s the financial burden of building infrastructure. We must trust the process. The benefits are immense, especially for a country that produces more gas than oil.”

He called for increased transparency and urgency from the Presidential Committee on CNG rollout. “Where the pressure should be is on that committee—to give us information in real-time, so Nigerians can understand what’s being done.”

Sowunmi also weighed in on President Bola Tinubu’s recent proposal to the National Assembly to raise new loans and issue bonds to mitigate the fallout from subsidy removal.

“There are multiple issues here,” he said. “When it comes to pricing, whether it’s Dangote, NNPC, or the regulator, they are all constrained. The biggest factor is the exchange rate. As long as there are currency fluctuations, it will affect pricing more than anything else.”

He described the ongoing standoff between the Dangote Refinery and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) as overly politicised.

“In reality, these are regulatory matters. The right institution to engage with Dangote should be the NMDPRA, not the presidency or NNPC. We are trying to build an industry. Regulators must be allowed to operate independently—even make mistakes—so they can grow stronger.”

Sowunmi warned that personalising institutions weakens the entire sector. “A weaker industry does not expand, attract investment, or become what we expect it to be.”

Boluwatife Enome

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