The Nigerian Upstream Petroleum Regulatory Commission (NUPRC), said it has recovered more than 50 fallow oil fields from licence holders who failed to meet their development obligations under the Petroleum Industry Act, saying it will keep enforcing its “drill-or-drop” policy.
The commission made the disclosure in Abuja at a panel session marking its fifth anniversary. Operators and regulators outlined the investment expected in the upstream sector and the reforms needed to turn it into economic value, THISDAY reported.
The commission’s director of Acreage Management, Olaide Shaw, said the fields were recovered about two years ago under the Petroleum Industry Act’s provisions on acreage management. They have since been offered in licensing rounds to investors able to develop them.
She said companies holding acreage must either deliver on their committed work programmes or give the blocks up. Warehousing, she said, happens when a licence is held without resources or work plans, and the holder only approaches the regulator for more time as expiry nears. It also occurs when firms with large portfolios put their resources into prime assets and leave other blocks idle.
“Acreage warehousing is a no-no,” Shaw said, adding that any warehoused acreage will go back into the pool. She described a working acreage as one with seismic activity, drilling preparation, procurement and signed drilling contracts.
Shaw also said the commission now processes approvals fully digitally, and is working with multi-client data firms such as TGS to make data available so investors can mature projects faster.
Chief executive of Renaissance Energy, Tony Attah, said the company produces about 265,000 barrels of oil per day and plans to raise that to about 500,000. It is targeting 1 million barrels of oil equivalent per day by 2030.
Attah said export gas will not industrialise Nigeria, so the company plans to supply 1 billion cubic feet of gas per day to the domestic market. It currently supplies about 200 million standard cubic feet per day, so the target is almost five times higher. He named partnership with NUPRC and the Nigerian National Petroleum Company Limited (NNPC) as critical to delivery..
Chief executive of First E&P and Nigeria’s OPEC governor, Ademola Adeyemi-Bero, said the country is in an investment cycle that could bring in about $100bn. He said the spending must benefit Nigerian contractors, service firms, communities and workers, not only firms abroad.
He urged banks to give oilfield service companies better access to capital, warning that weak contractor capacity could delay or stall final investment decisions. He also cautioned against awarding acreage to investors who cannot fund their commitments, noting that exploration wells are hard to finance with debt. “It will always be equity,” he said.
On OPEC, he assured that Nigeria will get the quota it requests next year. On the 3 million bpd production target for 2030, he said the focus should be on building a project pipeline. Bonga Southwest is expected to produce 180,000 bpd, so the country would need roughly eight such projects.
NUPRC’s executive commissioner, Development and Production, Enorense Amadasu, said the commission wants a competitive and predictable industry, and wants operators to become increasingly self-regulating.
Shell Nigeria’s country chair, Elohor Aiboni, said investment acceleration is already under way in the deepwater, citing Bonga North and other projects in execution. She said addendums signed to existing arrangements have opened room for additional projects. Eni’s Maurizio Pinna pledged faster project execution.
SOURCE: Leadership