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Major Oil and Gas Projects Delay Explained by NNPC

By on December 17, 2012

Andrew Yakubu, NNPC GMD

Despite being blamed by the International Oil Corporations operating in the country for delays in the takeoff of phenomenal and remarkable oil and gas projects that could launch the nation into another phase of economic boom, the Nigerian National Petroleum Corporation has made a statement defending itself on the situation.

A top official of the NNPC said that contrary to the allegations of the IOCs that various Oil and Gas projects had not seen significant improvement, the NNPC has actually been able to coordinate the project from an advanced stage .

According to the Official “The IOCs are our contractors and handle the tenders themselves, and then revert to us on the cost, which we have to approve. So our concerns have been the cost of these multi-billion dollar projects, because when we benchmark them against similar projects worldwide, they must conform to the costs that such projects will attract in other jurisdictions, give or take some variable,” he said.
Explaining further, he said: “If we do not curtail the costs, at the end, they will be passed on to the Federal Government and by extension, the Nigerian public.”

This has affected the pace at which the major exploration projects, because the State Oil Corporation and its oil majors counterparts failed to realize a pathway on the strategy and implementation of the key Oil and Gas projects.

Speaking on behalf of the Nigerian Petroleum Development Corporation (NPDC) on the issue of capacity and development of the existing Oil Mining Leases, Mr. Victor Briggs asserted that “From 2010 to date, our production rose from 65,000 to 130,000 barrels per day; the bulk of the increase consists of assets handed over to us upon divestment by some of our JV partners.

“But we realize that for us to meet the target of 250,000 barrels per day by 2015, we need to build on this by exploring further afield and drilling more wells. Okono 6 and 7 wells represent our success story in this direction.”

NNPC wants to revise the cost of their projects on exploration and drilling, while the IOCs are frowning at the approach of the State Corporation to the Joint Venture operations and partnership. It is expected that a resolution to the disagreement will be reached on the issue to boost production in the sector.