Industry operators have cautiously welcomed the pronouncement by the Nigerian National Petroleum Corporation (NNPC) that it has successfully fast-tracked contracting cycle for Upstream operations from 24 months to 9 months with a strong commitment to further reduce the process to less than six months in the months ahead.
While the operators saws it is a good development they however said that they would watch the development with utmost caution so as not to be caught off guard by government policy inconsistence which has caused many investors to lose money.
Edina wikinna, former External Relations Manager for Shell Nigeria Exploration and Production Company (SNEPCO) said there is nothing difficult about ensuring that there is a reasonable contracting circle for businesses in oil and gas industry. “It is doable. What was the problem before, he asked.
Another operators who wants to be anonymous said it would be good if it can happened as said by NNPC as it would enable investors to confidently plan and budget. It would also eliminate potential risk and changes in the economy.
In a presentation at the 12th Annual International Conference of the Nigerian Association for Energy Economics/International Association for Energy Economics (NAEE/IAEE), Maikanti Baru, group managing of the NNPC, said reducing the contracting circle to nine months is a process would allow for free flow of investments into the industry with far reaching effect across all tiers of its operation.
The NNPC boss who was represented by Victor Babatunde Adeniran, NNPC Chief Operating Officer (COO), Ventures, stated that NNPC had also been able to automate crude oil marketing process in the country.
He said: “This process has helped to evaporate the mystery around the management and sale of Nigeria’s crude oil grades with introduction of innovative solutions triggering an ambiance of transparency and stakeholders’ confidence in the operations of the COMD. I can state without equivocation that, today at a click of a button, we can tell you how much crude is sold, at what price, who bought it and where it has gone to”.
Maikanti Baru listed other achievements of the corporation to include: transparency and accountability, increased crude oil production, improved nationwide fuel supply, joint venture cash call exit, renewed frontiers exploration and revamp of critical downstream infrastructure.
Others, he said, included sustained gas supply to power which led to stable domestic gas supply capacity of 17000 million standard cubic feet of gas per day (mmscf/d) with an average of 1.3 billion standard cubic feet per day (bscf/d) supply to the domestic market.
Providing a long list of recipe that could be deployed to achieve energy efficiency, the NNPC’s helmsman noted that within the last three and half years the corporation had adopted a cocktail of practical approaches at achieving sustainable cost reduction in everyday business anchored on penetrating reforms across the entire value chain of its operations.
He advocated sync between energy efficiency and sustainable development while harping on the need to always strike the delicate balance between commitment to social development and economic growth to achieve a win-win scenario.
Earlier in his address, the President of the Nigerian Association for Energy Economics, Prof. Wumi Iledare, commended NNPC for its remarkable support in the past 12 years and appealed that the relationship be sustained to enable the professional body contribute meaningfully in generating solutions that the industry needs to grow the nation’s economy.
Olusola Bello
