(Ecofin Agency) - Revenue generation from crude oil is expected to drop from the $41.8 billion in 2016 to $38.5 billion this year if crude oil prices remain $55.53, The Guardian reports.

However, this $38.5 billion (N1.174 trillion) is below the N1.985 trillion, which the Federal Government anticipates from crude oil sales to finance the 2017 budget. In fact, it may affect government’s capacity to deliver infrastructural projects mapped out for implementation this year.

Investors have said that a positive dialogue with Niger Delta militants to end attacks on oil facilities especially on pipelines, will define the performance of this year’s budget and the country’s chances of getting out of the recession which was caused by low oil proceeds from lower exports as well as declining crude oil prices in Q2 of 2016.

According to the Chairman of the Petroleum Technology Association of Nigeria (PETAN), Bank-Anthony Okoroafor, the government needs to create opportunities for progress in Niger Delta.

By creating opportunities for many, businesses can succeed and the security of lives and property can be improved he said.

Meanwhile, the Director, National Independents at Schlumberger Nosa Omorodion, noted that the decrease in hydrocarbon exploration has caused a decline in oil and gas reserve base.

He said in order to recover Nigeria’s hydrocarbon resources, the government must seek more innovative and cost effective ways to increase reserves.

Anita Fatunji