Business

Why Nigeria is missing out in $110b global bitumen market

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Though Nigeria has one of the largest deposits of bitumen in the world, stakeholders have expressed concern over government’s inability to properly harness the resources for the country’s economic benefit.

Report by Global Market Insights Inc. had indicated that the market size for the resources would exceed $110 billion by 2024, especially with stimulated efforts witnessed in increasing government initiatives towards repairs and redevelopment of roads across the world.

Chairman of Council at the Institute of Oil and Gas Research and Hydrocarbon Studies, Prof. Akin Akindoyeni, said continuous import of bituminous materials into the country would continue to put pressure on foreign exchange if government refuses to address the challenges affecting the exploitation of the resources.

Bitumen, a black viscous mixture of hydrocarbons obtained naturally or as residue from petroleum distillation, is basically used for road surfacing, roofing, adhesives, Insulation and others.

According to the Federal Ministry of Mines and Steel Development, Nigeria has the second largest deposit of bitumen in the world, spanning approximately 120km.

But countries like the U.S., Canada, Germany, UK, France, Spain, Italy, China, India, Japan, Australia, Indonesia, Malaysia, Brazil, Mexico, and South Africa dominated the market.

While the ministry admitted that the bitumen used in Nigeria is processed from imported heavy crudes, in addition to bitumen imported to supplement local consumption, noting that heavy and extra heavy crude could be extracted from Nigerian tar sands and sulphur, Akindoyeni said government abandoned the sector due to oil discovery.

“Even if the product is for domestic consumption in the maintenance of our highways, it should give us an opportunity to this right for a change,” he said.

According to him, Nigeria may lose out in the benefits of the hydrocarbon resources as the world is currently developing alternatives that could make the resources less attractive.

He said: “Nigeria has one of the largest deposits of bitumen on this planet. It has not been exploited, yet we import bituminous materials.

Are we waiting for the time when other viable alternatives to bitumen to be discovered before we allow the exploitation of ours? The market price of petroleum declined because of the development of shale oil.”

An expert in mineral resources, Prof. Eguakhide Oaikhinan, blamed the situation on the lack of roadmap for effective development of mineral resources in Nigeria.

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Categories: Business