As part of move towards increasing Nigeria’s crude oil production and growing its reserves, the Nigeria National Petroleum Company Limited (NNPC Ltd) has declared a state of emergency on production in Nigeria’s oil and gas industry.
Group Chief Executive Officer of NNPC Ltd, Mele Kyari, disclosed this while giving a keynote address at the opening ceremony of the 23rd edition of the Nigeria Oil & Gas Conference and Exhibition (NOG Energy Week) in Abuja, on Tuesday.
According to the NNPC Limited boss, there is need to ramp up oil production to grow local capacity saying the Company is working vigorously to close the two million barrels per day oil gap as Nigeria currently produces between 1.2 million and 1.4 million barrels per day.
He said it is time to take the bulls by the horns by tackling those challenges that are creating obstacles to Nigeria’s crude oil production. He added that the era of debate has gone while calling on all stakeholders to come together to remove principalities “hindering our production.”
“We can’t continue talking, we cannot continue debating. Debate don’t produce oil, debate produce conflict. This industry is about producing oil and gas. Yes, we can do so many other things as you have heard the OPEC Secretary General and the GCF Secretary General have said but the world expect many other things from us. But more importantly for all of us in this room, I’m sure the biggest interest is to produce more oil and more gas. We don’t need to talk about reserves we have reserves. It is all dream until you produce it.
Therefore, what we are focused on with our partners today is to produce more oil and to grow the production. It is to produce more oil and how do you produce more oil? It’s common knowledge also that we must put money, we must get the right people to work, we must have the right technology and the will to produce it so that we can benefit from it.
But what really happened in our country, we went down in our production in both oil and gas. Nowhere near our capacity and our capability. You can blame anything; oil theft, integrity and so on and so forth. But the bottom line is that what we did recently is to take a deeper look at where we are and when we look at the data for our production by assets in the last three months without doing anything, without mobilising any rig, we can talk about decline as it has been said, but decline don’t happen in three months.
“Even when we took a look at our production in the last three months by assets, we discovered that we are actually at two million barrels per day. That means we’re unable to sustain it. Yes we can blame anything for lack of sustainability, theft is one of them, vandal action but also the sheer inability of all of us, our partners no exception including NNPC, our inability to act quickly in the timely manner.”
Kyari said a detailed analysis of assets revealed that Nigeria can conveniently produce two million barrels of crude oil per day without deploying new rigs, but the major impediment to achieving that remains the inability of players to act in a timely manner.
“Also, we can blame anything, access to capital, yes. Why don’t we have access to capital. We can blame anything but what we have seen is that we are actually at two million barrels per day without doing any of the major things we are talking about,.without the new 700,000 that has been talked about. And that is why we (NNPC) as the partner of 80 percent of those who produce oil and gas in this country have decided to stop the debate. We have declared a war and war means war. We have the right troops. We know what to fight. We know what we have to do at the level of assets and we’ve engaged our partners.
Any partner that doesn’t do what it should do will get it done. We can’t wait for anyone, we are moving on. We cannot afford to negotiate any further. So, we have stopped the debate. And by war what it means is that we are looking at every asset, every issue that is associated with it. We’ll partner with our counterparts but if it doesn’t happen, we get it done and this is the meaning of the war. From security, assets to integrity to everything you can think of.
“As a matter of fact and as you all know, our pipeline network today, the major trunk line delivering crude to Bonny and Forcados and Brass and all of them as you all know are all constructed in 1970. No pipeline survives this. With or without the vandal action or the theft, we have taken another major decision that we’ll replace these pipelines. On this no debate. And when we replace them everybody must flow his crude inside this line. It’s not just a business decision, it’s a national decision. We are very determined to deliver on this and we will move on.”
The NNPC helmsman called on all players in the industry to collaborate towards reducing the cost of production and boosting production to target levels. He expressed the Company’s commitment to investing in critical midstream gas infrastructure such as the Obiafu-Obrikom-Oben (OB3) and the Ajaokuta-Kaduna-Kano gas pipelines to boost domestic gas production and supply for power generation, industrial development and economic prosperity of the country.
On Compressed Natural Gas (CNG), Kyari observed that NNPC Ltd. has since keyed into the Presidential CNG drive, adding that in conjunction with partners such as NIPCO Gas, NNPC Ltd. has built a number of CNG stations, 12 of which will be commissioned on Thursday in Lagos and Abuja.
Goodwill messages and keynote addresses were presented by the Secretary General of the Organisation of the Petroleum Exporting Countries (OPEC), Haitham Al Ghais; Secretary General of the Gas Exporting Countries Forum (GECF), Engr. Mohamed Hamel; Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri; Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo; Special Adviser to the President on Energy, Ms. Olu Verheijen as well as the Chairman, Independent Petroleum Producers Group (IPPG), Abdulrazaq Isa.
Credit: Nigerian Tribune