FG is seeking investors for bitumen development

By Adeleye Kunle

The federal government has invited national and international investors to help develop the country’s 42 billion barrels of bitumen reserves.

Dr. Abdulrasaq Garbar, Director-General of the Nigerian Geological Survey Agency, stated at a virtual event hosted by the Ministry of Mines and Steel Development that Nigeria has the world’s sixth largest bitumen reserves.

Garbar also provided geo-scientific data and other information to guide investors during the session, which was organized in collaboration with PwC Nigeria.

Obadiah Simon, Director-General of Mining Cadastre and Chairman of the Bitumen Committee, reiterated that Nigeria was endowed with mineral resources that had gone untapped.

“There have been tremendous successes, but there are many more opportunities for improvement, particularly with regard to the bitumen resource.” This has gone untapped for years, creating a massive opportunity for domestic bitumen production in place of the country’s bitumen importation,” Simon explained.

Also, Cyril Azobu, Leader, Mining Practice, PwC Nigeria, explained that the firm’s mandate on the Bitumen program is to ensure the uniqueness and peculiarity of bitumen exploration, development, and extraction.

As a result, he stated that only appropriately qualified local and international investors will be chosen to carry out Bitumen development to a meaningful extraction level.

“This will be done through a transparent and competitive procurement process, as stipulated in the Nigerian Mineral and Mining Act 2007, and in accordance with global best industry practices,” Azobu stated.

He also stated that during the seven-month bidding period, which will run from May to November this year, local and international investors must prepare a Request for Qualification application and submit it to Bitumen.ngsa.gov.ng.

According to him, the application consists of six credentials, including Bitumen testing experience, Bitumen refining capabilities, and Bitumen exploration and extraction.

Furthermore, investors must adhere to applicable environmental, social, and governance sustainability guidelines, have balance sheet assets in excess of $25 million, and have the technical and financial capability to carry out feasibility studies.

Last November, the Ministry of Mines and Steel Development appointed PwC as Transaction Adviser/Program Manager to oversee the selection of bidders for the development of Nigeria’s defined Bitumen blocks through a competitive tender procedure.

Bitumen, a hydrocarbon obtained naturally or as a byproduct of petroleum distillation, is primarily used in road surfacing and roofing. The global market is estimated to be worth approximately $110 billion.