Indigenous oil and gas companies in the country have invested about N3.0 trillion in acquisition and development of petroleum assets in the upstream end of the industry. The group which secured the commitment of the new administration of the federal government dismantling cost drivers in the operating environment stated that it targets to boost collective production volume by members from current level above 200, 000 barrels per day to over a million barrels per day.
Managing Director of Seplat Petroleum Development Company Limited, Mr. Austin Avuru, stated in Abuja after a meeting with President Mohammadu Buhari declared that large scale crude oil stealing, associated pipeline vandalism and production losses continued to key obstacles to operations in the onshore locations of the Niger Delta. In stating the contributions of the indigenous companies in the petroleum industry, Mr. Avuru said the indigenous firms had spent about $9.0 billion in acquiring assets in the industry and spent over a billion dollars annually on work programmes in the past five years.
He also pledged the commitment of indigenous companies to the ongoing drive to revive and grow the country domestic refining capacity to optimize the full economic values of the nation’s petroleum resources. The UNION reports that apart from the ongoing programme to rehabilitate and revive the nation’s three public refineries with combined installed capacity for 445, 000 barrels per day, Dangote Group is raising a 400, 000 barrels per day greenfield refinery in Lagos while fringe players like Orient Petroleum Resources and Amakpe Refining Limited are building 60, 000 barrels per day refineries in Anambra and Akwa Ibom states respectively.
Also, an indigenous producer, Niger Delta Petroleum Resources (NDPR) has successfully streamed a small refinery at its production site in the Niger Delta for conversions of its crude output from operated marginal field into diesel. However, the option of mini-refinery by NDPR was compelled by production losses, protracted downtime and maintenance costs associated with crude oil stealing and pipeline vandalism in the operating environment. A statement by the Senior Special Assistant to the President on Media and Publicity, Garba Shehu, said the president has directed the management of the Nigerian National Petroleum Corporation (NNPC) to work more closely with the indigenous oil producers to resolve the problems which members of the group said were affecting their operations. The president pledge to enhance security in their areas of operation and mitigate the high production cost in the country. President Buhari’s main pledge around the oil sector was to try to eliminate oil theft, a scourge on the industry in recent years.
He said in July that under NNPC’s watch, Nigeria was losing about 250,000 b/d of its oil production to theft, amounting to about $10 billion to $20 billion annually, depriving the country of muchneeded income that could have been deployed to develop social infrastructure.
Shortly after, NNPC announced plans to explore community based pipeline protection model in the Niger Delta. Spokesman, Mr. Ohi Alegbe, stated that the corporation might settle for the option of community based policing to protect the vast artery of oil and gas pipeline network across the country.
He quoted the Group Managing Director of the corporatgion, Dr’ Emmanue Kachikwu, who hosted the Canadian High Commissioner to Nigeria, Ambassador Perry John Calderwood, to a courtesy visit to the NNPC Towers, as saying that NNPC would give attention to the perennial menace of pipeline vandalism and oil theft. “I intend to give a lot of energy to the issue of oil theft and pipeline vandalism. We must keep the losses from oil theft to the lowest figure possible. I don’t believe in the arm -for-arm approach, we must engage the host communities and inculcate in them the need to see the assets in their domain as their own,’’ Kachikwu said. The GMD noted that in the months ahead, the Corporation would initiate discussions with community leaders and interest groups with a view to fashioning a workable community oriented pipeline protection format with less emphasis on the use of brute force to secure the lines.
On the state of the refineries, the NNPC helmsman solicited for support from Canadian companies and service providers stating that Nigeria could make do with Canada’s vast experience in refining and expertise in oil and gas operations. Amb. Calderwood said the Canadian government and business entities were willing to work with the NNPC in growing the Nigeria oil and gas industry to enviable heights. However, while Buhari has pursued his target of overhauling the NNPC and addressing theft in the petroleum sector, industry analysts demand him to withdraw political interference in NNPC to ensure its efficiency.
Energy analyst, Wunmi Iledare, said: “We must have an NNPC board that devoid of politicians, by so doing they will allow the new management to work without political interference.” Also, the President of Petroleum and Natural Gas Senior Staff Association of NIgeia (PENGASSAN), Comrade Francis Johnson, declared that only an apolitical NNPC would make the industry efficient, and put it in a position to complete among its peers in the world, such as Saudi Aramco of Saudi Arabia, Petronas of Malaysia and Petrobras of Brazil,”.