31 July 2012, Sweetcrude, LAGOS – AS scepticisms rise on the possibility of Nigeria finding oil in the nation’s river basins, the industry regulator has reassured that there is no giving up, as there is still hope of making commercial finds.
Director of the Department of Petroleum Resources, DPR, Mr. Osten Olorunsola, gave the reassurance, when the House Committee on Petroleum (Upstream) made an oversight visit to the DPR Headquarters in Lagos.
Notwithstanding that hundreds of millions of naira that have been sunk into the search, he argued that the Federal Government is convinced that there are still commercial prospects in the basins, even as Nigerian and Chinese explorers conclude the first phase of search in the Chad Basin, using state of the art technology without much success.
Olorunsola insisted, “All that is needed is to find oil in commercial quantity in the river basins and the whole scenario will change, just as it did with the deep water region, which grew as soon as Bonga found commercial oil.”
Olorunsola, who put Nigeria’s current reserves at 36 billion barrels and daily crude production at 2.5 million barrels against producibility of 3.2 million bpd, expressed concern over the dearth of investments in the petroleum industry.
He attributed the trend to the non-passage of the Petroleum Industry Bill, PIB, and the lack of access to oil fields during the Niger Delta crisis.
Against this backdrop, “It will take another five years to get back to success and we hope to make corrective steps as quickly as possible,” the DPR boss said, adding that “Only one major final investment decision, FID, (Total’s Usan) has been taken in a very long time.
He noted the while the Niger Delta was in crisis, investment drive shifted to other parts of Africa, as practically every country in Africa has either found oil or gas in commercial quantities.
“So there is the need to ensure investment flows, as competition is now very stiff not only to boost employment generation, but also increase production capacity,” he argued.
Olorunsola further revealed that of the 388 oil blocks in the country, only 173 have been allocated to various companies, leaving 215 still awaiting bid rounds. And of the 315 fields, only 70 percent of these are producing, with 30 percent undergoing exploration and appraisals stages.
Besides, he noted that most of the nation’s current productions are in the hands of the multinationals, with the 26 marginal field operators contributing very little to the volumes.
He added that it is hoped that the passage of the PIB, the participation from the indigenous players will improve more than over the past 50 years of oil production, as there is the need to incentivize the indigenous players to do more.
Responding to the issues raised by the Chairman of the House Committee, Upstream, and leader of the delegation, Hon. Muraina Ajibola, expressed satisfaction with the progress made by the industry regulator, in terms of budget implementation, revenue generation and transformation of the industry.