Key Points
- NNPC declares state of emergency in the oil and gas sector
- It seeks collaboration from industry players for crude oil production
- Out to tackle inefficiencies in crude oil production
In a decisive move to enhance Nigeria’s crude oil production and expand its reserves, NNPC Ltd has declared a state of emergency in the country’s oil and gas sector.
The announcement was made by the Group Chief Executive Officer of NNPC Ltd, Mr Mele Kyari, during the keynote address at the 23rd edition of the Nigeria Oil & Gas Conference and Exhibition (NOG Energy Week) held in Abuja on Tuesday.
Keynote Address Highlights Industry Issues
“We have decided to stop the debate. We have declared war on the challenges affecting our crude oil production. War means war. We have the right tools. We know what to fight. We know what we have to do at the level of assets. We have engaged our partners. And we will work together to improve the situation,” Kyari stated emphatically.
Potential to Increase Production Without New Rigs
According to Kyari, a detailed analysis of Nigeria’s oil assets indicates that the country can produce two million barrels of crude oil per day without the need for new rigs. However, he highlighted that the primary obstacle to achieving this goal is the industry’s sluggish response to necessary actions.
Addressing Procurement Delays and Infrastructure Issues
Kyari emphasised that this “war” on production inefficiencies will enable NNPC Ltd and its partners to swiftly address and eliminate obstacles such as procurement delays, which have been a persistent issue in the industry.
Long-Term Strategy for Sustained Production
As part of the medium to long-term strategy to boost and sustain production, Kyari revealed that NNPC Ltd plans to replace all aging crude oil pipelines, some of which were built over four decades ago.
Additionally, the company will introduce a rig-sharing programme with its partners to ensure that production rigs remain operational in the country for a standard period of four to five years.
Call for Industry Collaboration
Kyari called for industry-wide collaboration to reduce production costs and achieve target production levels. He reaffirmed NNPC Ltd’s commitment to investing in critical midstream gas infrastructure, including the Obiafu-Obrikom-Oben (OB3) and the Ajaokuta-Kaduna-Kano gas pipelines, aimed at boosting domestic gas production and supply for power generation, industrial development, and economic growth.
Investment in Compressed Natural Gas (CNG) Infrastructure
In alignment with the Presidential Compressed Natural Gas (CNG) drive, Kyari noted that NNPC Ltd, in partnership with NIPCO Gas, has constructed several CNG stations, with 12 set to be commissioned this Thursday in Lagos and Abuja.
