FG realizes $180bn in revenue from deepwater operations but 80 blocks still not producing – NNPC

Nigeria’s deepwater operations have generated revenue exceeding $180billion following industry players’ huge capital investment therein, Dr. Maikanti Baru, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), has said

Baru made the disclosure yesterday while delivering a paper entitled: “Deepwater Operations in Nigeria: The journey so far” at the Panel session of the Petroleum Technology Association of Nigeria (PETAN) in the ongoing golden anniversary of the Offshore Technology Conference (OTC) in Houston, Texas.

Represented by Mallam Bello Rabiu,  the Chief Operating Officer, Upstream of the NNPC, Dr. Baru stated that Nigeria held approximately 13billion barrels of oil, out of which about  two billion has been produced with a huge volume yet untapped.

Dr. Baru, was quoted in a statement as saying Nigeria remained an active player relative to other regions in terms of deepwater development, adding that the industry started with the deployment of latest technology, a stride it has continued to maintain.

He said: “Of the 15 Floating Production Storage and Offloading (FPSO) in Nigeria, seven have been deployed for deepwater operations.  Nigeria ranks only behind Angola within the African deepwater operations in terms of FPSO deployment.”

He stated that the country has utilized each deepwater project as an avenue to upscale its unique human capital skills in different areas not limited to engineering design, project management, welding and diving.

He added that the local content contribution or services share in deepwater had continued to grow and  improve from the sub 1% level to an aggregate contribution of over 25%, from engineering man-hours of less than 20,000 to over 1.1 million in recent Egina project.

“With the Nigerian content, tonnage has grown by 600% from the first deepwater project till date,” Baru noted.

The NNPC helmsman stated that deepwater projects had benefited the wider Nigerian economy by boosting demand for a range of goods and services, including offshore vessels and platforms, materials, floating hotels, helicopters and manpower, creating jobs and providing wide range of training and maintenance services to the industry locally.

He added that services in areas such as manpower supply, logistics, and vessel supply, chemical supplies had more or less been domesticated in the deepwater value chain.

Dr. Baru, who averred that the recent further demonstration of this was the in-country topside integration on the Egina FPSO project, saying this, had achieved the dual goal of both industrialisation and manpower development through job creation and skill acquisitions.

He said that the development implied increase in steel demand, as steel  represents 20% to 35% of the overall cost for a new-build structure, dry docking, pipe coating, welding and sundry ancillary services, adding that that Nigeria needed the right caliber of technical and engineering skills and manpower.

The GMD urged the players in the deep water sector to start, beginning from now, to create the linkages to the local economy, saying that the local economy must be able to deliver the growth aspirations or support adequately the demand of tomorrow.

Dr. Baru called on the Petroleum Association of Nigeria (PETAN) to fill the technology gap, stressing that OTC provided not just a window to the global Oil and Gas Industry but also a gateway for Nigeria and the Nigerian Oil Industry to access the best of technology and contribute to national development.

He said NNPC would continue to support planned deepwater projects, while ensuring adequate local participation.

The Oil Industry expert said Nigeria had experienced phenomenal growth in deep water operations. “At my last count, about 10 deepwater projects are lined up for sanctioning.

Also, given the lead time for project maturation, the time to build is now for us to achieve the results we desire, seizing the chance to develop our Oil and Gas Industry and by extension the economy.”

Dr. Baru noted that there were 87 deepwater blocks in Nigeria, out of which only seven are producing and additional six at different phases of development. He stated that more than half of the blocks in deepwater Nigeria are open.

 

Source: Independent

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