Kachikwu: Oil prices will affect some capital projects in 2017 budget

Ibe Kachikwu, minister of state for petroleum resources, says current oil prices and production levels will affect some capital projects in Nigeria’s 2017 budget.

Speaking at a press conference in Abuja on Wednesday, Kachikwu said the ministry of finance is working hard to efficiently find a way around meeting budget expectations.

“In terms of the budget impact, definitely, I mean, it is predicated on the number of 2.2 million barrels per day and a price index of 42.50 dollars. Within the price cap, I think we’re still reasonably within range,” he said.

“Obviously we have lost quite a lot of months, some months, at least, two or three in which we did not produce what the budget had projected, so there is definitely going to be differential.

“Like you know, the Ministry of Finance is aggressively looking for ways to cover some of these shortfalls; part of that is efficiency, how do we cut down our expenditure?

“Obviously, certain capital items will be affected;  if we do not have money, we cannot do certain capital projects that we have in the budget.

“There is no gainsaying the fact that budget will be impacted but we are working hard with the Federal Executive Council to see how we can forecast or predict that sort of impact and see how we can recover.”

He went on to reaffirm Nigeria’s commitment to continue working with other players for the stability of the global oil market.

Kachikwu explained that while Nigeria noted the recovery of its oil production in recent weeks, the upsurges remained fragile, assuring that Nigeria will continue to monitor developments.

The minister confirmed receiving invitation to the next joint ministerial monitoring committee meeting of the OPEC and non-OPEC accord countries, scheduled to take place in St Petersburg, Moscow, on July 24, but regretted his inability to attend because of a prior commitment to host ministers of petroleum of the African petroleum producers’ organisation countries on the same day in Abuja.

He assured that Nigeria remained steadfast in its commitment to global oil market stability as it has done in the last forty-six (46) years as a member of OPEC and would always be part of the action taken by other OPEC member countries and contribute its quota once its productions status stabilises.