People & Money

Nigeria’s Crude Oil Reserve Inches Towards 40billion barrels, As Gas Reaches 208.62TCF

Nigeria’s hydrocarbon reserve inches towards the much awaited 40 billion barrels without major discoveries and lack of investment in the sector in the recent past.

According to the Federal Government at the weekend, this development shows that the country’s oil and gas reserve has continued to increase.

Figures released in Abuja by the Nigerian Upstream Petroleum Regulatory Commission, a Federal Government agency, showed that the country’s oil reserves increased by 0.136 billion barrels to 37.046 billion barrels as of January 31, 2022.

Nigeria’s gas reserves also grew by 2.09 trillion cubic feet to 208.62TCF as of January 31, 2022, based on data released by the NUPRC.

Gbenga Komolafe, Chief Executive, NUPRC, stated that the announcement in respect of the growth is that the growth of the country’s reserve is in line with the provisions of Sections 7 (i), (j), (k) and (r) of the Petroleum Industry Act 2021.

He said the Act stipulated that all operating exploration and production companies were to submit their annual report of reserves to the commission.

The NUPRC boss said, “A total of 61 operating companies submitted their 2021 annual report on reserves in line with the provisions of the PIA, 2021.

“Analysis of the report indicates that the nation’s oil and condensate reserves status as at January 1, 2022 was 37.046 billion barrels representing a slight increase of 0.37 per cent compared to 36.91 billion barrels as at January 1, 2021.

Also Read: Why Oil and Gas Industry Is Not Attracting Investments – NUPRC

“On the other hand, the national gas reserves status as of January 1, 2022 was 208.62 trillion cubic feet, representing an increase of 1.01 percent compared to 206.53TCF as at January 1, 2021.”

He also stated that the commission recognised that the formulation of all-inclusive strategies to increase crude oil and gas reserves (from 37 billion barrels and 208.62 TCF) required thorough consideration of all factors militating against efficient and effective exploration and production operations.

He said the NUPRC had initiated a campaign dedicated to the identification of oil and gas wells producing below capacity through the inventorisation of shut-in wells and analysis of the inventory to map the reasons for shut-in and devise measures for quick reopening.

Komolafe said the commission was also using well and reservoir surveillance activities in identifying poorly performing wells and work-over candidates for quick intervention.

He said the NUPRC was embracing and adopting new technologies and advanced recovery techniques for unlocking some identified stranded oil and gas resources.

He further noted that the conflict between Russia and Ukraine and the attendant disruptions to the global gas demand-supply chain had provided Nigeria with a unique opportunity to fill this gap through the implementation of several gas developmental initiatives.

He said the commission was currently engaging all lessees on their Natural Gas Flare Elimination and Monetisation Plan to ensure compliance with Section 108 of the PIA and boost supply to the rapidly growing gas market.

“Furthermore, in the face of the global energy transition and the need for cleaner sources of energy, gas is being positioned as our immediate transition fuel to lower the nation’s carbon emission footprint in line with our climate change commitment,” Komolafe stated.

He continued, “Additionally, we are encouraging investors to leverage on the generous gas fiscal incentives in the PIA such as zero hydrocarbon tax, reduced royalty rates, tax consolidation provisions, among others, to take Final Investment Decisions on their proposed upstream projects.

“With a proven gas reserve base of 208.62TCF (as at January 1, 2022), we are on track to increase our reserves volumes to 220TCF in less than 10 years and 250TCF thereafter.”

The NUPRC boss noted that Nigeria was currently producing about 8BSCF/D of gas, out of which about 20 percent was delivered to the domestic market, approximately 40 percent exported to the international market.

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