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Tuesday, June 25, 2024

NNPCL to resume oil search in Lake Chad —Kyari

By Suoyo Ekubo 

The Nigerian National Petroleum Company Limited (NNPCL) will resume oil search in Lake Chad next week, the Group Chief Executive Officer (GCEO), Malam Mele Kyari, disclosed this on Monday. Daily Trust reports.

Malam Mele Kyari revealed this when he led his management team on a courtesy visit to the Abuja headquarters of Media Trust Group (MTG), owners of Daily Trust, Trust TV, Trust Radio and other platforms.

Kyari said the company had a directive from President Muhammadu Buhari to resume oil search in the Lake Chad Basin in Borno State after it was stalled for over five years due to insurgency in the North East.

The NNPC boss noted that the discovery of oil in viable commercial quantities in Kolmani River (upper Benue trough) between Gombe and Bauchi states last November gave positive signals for more efforts in Lake Chad.

He said, “It was the Kolmani that helped us to locate a position in Nasarawa State. It is the same reason that by next week, we’ll spud in another well in the Chad Basin. Mr President directed us over a year ago that we should go back to the Chad Basin and continue exploration work.”

Justifying the planned resumption of the oil search, Kyari said: “Security of our workers is the most important element of our work. We have assessed the environment and we know that substantial peace has been regained in the Chad Basin.

“Communities have returned to their locations and their villages. You do not hear of incidents and there is substantial containment of this.

“And we’re also working very closely with the security agencies; the state government to make sure that staff are safe, our equipment are safe. I will have no doubt that the safety of our staff is assured and that’s why we are going back because there is relative safety in the location,” Kyari explained.

Speaking on the status of the discovered oil in Kolmani and the search in Ebenyi A, Kyari said: “Our first focus is to deliver the in situ refining experiment and when Mr President flagged off the Kolmani River well, we promised we will get it done in 36 months and we’ll deliver it. Our rig is drilling in Nasarawa and our team is on site, continuously working and we are very optimistic.”

On the shares of NNPC Ltd., Kyari said the company is owned 100% by Nigeria.

“So, the over 200 million Nigerians are literally the shareholders of this company today. These shares are held in trust by the Federal Ministry of Finance Incorporated, and the Federal Ministry of Petroleum on behalf of the federation.

“What the Petroleum Industry At 2021 (PIA) provided for is that within three years, this company’s ordinary shares can be sold to other Nigerians or interested international partners that combine shared values. There’s a process for this- that means you must take it to an Initial Public Offering (IPO) level.

“Once at IPO level, those shares will be declared. It will be done with the authority of the National Economic Council, which means all the 36 governors of the state must agree that certain shares of this company can be sold.

“We believe that the system’s transparent and accountability processes that we have on the ground are sufficient and by the end of June, maximum by the end of the year, it will be clearly IPO already. The timeline is that it can be done within three years of the incorporation of NNPC, which is effective from 2021, by 2024 we should be able to go to IPO,” he noted.

The NNPC head also gave an update on the status of the refineries’ rehabilitation projects, saying the Port Harcourt refinery would have been ready this month but for some supply issues.

Kyari said: “Our plan is to bring it on stream this month but unfortunately, we have some slippage because of global supply chain issues that we had.

“We believe that this plant will come on stream before the end of this year. We’re very sure of that. The Port Harcourt refinery has a combination of 210,000 barrels per day so that means it’s a third of the Dangote refinery.”

NNPC has a total refining capacity of 445,000 barrels in four refineries in three locations. Kyari said rather than use public funds, money was borrowed for the rehabilitation of the refineries and their repayment tied to their performance.

“We’re also borrowing to fix the Warri and Kaduna refinery. Kaduna will kick up, it is a 36 months project but what happens in the rehabilitation is that you do them stage by stage.

” We will replicate the same thing in the Warri refinery and the contractor is on site and Daewoo is on site working; mobilised to site, equipment being delivered to site and we believe also that within that 36 month cycle, it will also complete the rehabilitation but we’ll start fuel before that time.

“Port Harcourt will start producing fuel this year and by the first quarter of next year, Kaduna will start producing fuel,” the NNPC boss revealed.

Speaking on delivering more gas infrastructure in Nigeria and beyond, Kyari said Nigeria is more of a gas country than crude oil.

“We are actually a gas country with associated oil. You know, our focus has always been on oil, we have never paid significant attention to gas, and there’s so much gas here in this country that maybe another 100 years we still have gas because we have close to 600 trillion standard cubic feet (scuf) of gas in place.”

Kyari also said NNPC is targeting two pipelines for gas export, which is the trans Algeria pipeline into Europe going through the new Ajaokuta Kaduna Kano (AKK) gas pipeline project and the Nigeria, Morocco gas pipeline to lead to Europe.

On the AKK pipeline project, he said: “The AKK component is just one leg of it starting from Ajaokuta through Abuja, Kaduna into Kano, and potentially what we’re trying to do now is to see if there’s excess capacity, which can make it across the Sahara into Europe.”

Kyari also revealed that one of the power plant projects along the AKK route will soon commence.

“We have almost completed contracting so we will commence construction of the Abuja power plant within this month or latest by next month.

“I believe that we will start it soon so that we can now have power in Abuja, create a power plant in Kaduna and also in Kano. That way, power comes close to his consumers, transmission through the grid becomes easier,” he said.

For the Morocco project, he said: “That’s one of the most ambitious projects that we have and is going to cost over $25 billion, but more than anything, it is going to connect 11 West African countries to our gas sources and that way, we will be creating prosperity around Nigeria.”

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