“Oil and gas sector is very important in Nigeria’s growth. We should tackle the challenges in the sector to harness its potential.”
Uche Usim, Abuja
President Muhammadu Buhari on Thursday hailed various reforms carried out in the petroleum industry as being responsible for purpoted improvements in the sector.
This is as the Minister of State, Petroleum Resources, Dr Ibe Kachikwu reiterated that Nigeria will begin exporting refined products by the end of 2019.
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Speaking at the launch of a book on Three Years of Key Achievements of the Petroleum Resources Ministry in Abuja, President Buhari, who was represented at the event by the Secretary to Government of the Federation, Boss Mustapha, said his administration inherited an oil and gas sector battling with various blights like pipeline vandalism, restiveness in the Niger-Delta region, low oil production volumes, falling oil price in the international market, poor policies, among others challenges.
The administration, he noted, had tackled the issues headlong, according to the president, with the creation of the 7 Big Wins reform initiative, accounting for improvements in the sector, with crude oil output increasing from 800,000 barrel per day to about 2 million barrels per day, among other measures.
The Buhari administration also touted establishing a national gas flare development programme aimed at not only preventing waste and environmental pollution but also utilizing and exporting it.
While appreciating various agencies under the Petroleum Ministry for their efforts in improving the industry, Mustapha, speaking on behalf of the President, assured of sustainable strategic plans to ensure petroleum products availability all year round.
“This will be sustained to make life easier for Nigerians,” he said.
“Oil and gas sector is very important in Nigeria’s growth. We should tackle the challenges in the sector to harness its potential.”
Also speaking at the event, the Minister of State, Petroleum Resources, Dr Emmanuel Ibe Kachikwu in his keynote address said his presidential mandate was to tame corruption in the sector and enthrone transparency.
“When we came over three years ago, national reserves was down to like $16 billion, oil production was very low, pipeline destruction was high and all that,” the minister said.
“So, everything was hinged on the Ministry to turn things around. Part of our success story is that we increased national crude oil reserves to 37.2 billion barrels of crude oil by 2017. This was due largely to the discovery of Owowo field in deepwater OML 139 with an estimated 1 billion barrels of crude oil reserves.
“We initiated and completed the repair of vandalized 48” Forcados Oil Terminal (FOT) export pipeline leading to the resuscitation of over 300kbopd in deferred production that lasted over one year and two months.
“We renegotiated upstream contracts and obtained discounts of over $2 billion from various service providers to stem the high production cost. We lowered the unit cost of production for upstream companies from $27/barrel to $22/barrel,” he said.
With regards to refineries, Kachikwu said plans were afoot for complete rehabilitation of four existing local refineries utilizing Capital in form of project financing model.
He added that the return of the refineries to Original Refinery Builders (ORBs) will ensure their operation and reliability above 90 percent, while maximizing in-country refining of the 445,000bopd for domestic consumption.
“The plan to become a net exporter of refined products by year-end 2019 is on course,” he noted.
In his goodwill message, Senator Omotayo Alasoadura, Chairman, Senate Committee on Petroleum, Upstream, said the National Assembly has worked hard on the Petroleum Industry Governance Bill (PIIGB) to get it to the level it is today.
“After over 12 months, I was heartbroken when Mr President returned the document meaning our efforts were flushed down the drain.
“Kachikwu should note the area of one-stop-shop regulatory authority as President Buhari didn’t like it but it’s in consistent with international best practices”, he stated
In his remarks, Victor Nwokolo, Chairman House Committee on Petroleum Resources, said the compendium of three-year work of the Ministry was a clear departure from the past since there are milestones to gauge the performance of the Buhari administration.
He commended Kachikwu for doubling as a diplomat, as he sought international collaborations, while churning out various policies aimed at setting the industry on a successful path.
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