The Minister of State for Petroleum Resources, Ibe Kachikwu, on Monday said Nigeria may force oil companies to lower production costs if negotiations fail.
According to Mr. Kachikwu, countries like the United Arab Emirates had cut costs significantly, saying they are the lowest-cost producers in the world.
The minister said this at the opening ceremony of the Nigeria Annual International Conference and exhibition organised by the Society of Petroleum Engineers in Lagos.
Channels Television reports that Mr. Kachikwu explained that Nigeria might forcefully call for a reduction in production cost, if negotiations are not possible.
He, however, added that only oil companies that are able to drive down costs will thrive in the country.
“For me, you rather leave the oil in the ground than produce at a cost that doesn’t make sense,” he said.
“So, cost is going to be a very high driver. So that is certainly one area we are focusing on; we are working collaboratively with oil companies.
“But let’s make no mistake about it, if we cannot negotiate it down, we will compel it or we will stop the production; it does not make any sense.”