…targets 165,000 bpd crude oil production by year-end 2024
In line with the Petroleum Industry Act (PIA) 2021 provisions of transiting assets from the Petroleum Profit Tax (PPT) into PIA terms, the NNPC Ltd and its Joint Venture (JV) partner, Chevron Nigeria Ltd (CNL), have concluded the conversion of five of its JV assets from Oil Mining Leases (OMLs) to Petroleum Prospecting Licenses (PPLs) and Petroleum Mining Leases (PMLs).
Speaking during the document signing in Abuja on Monday, Bala Wunti, the Chief Upstream Investment Officer, of NNPC Ltd, noted that the assets conversion is expected to significantly boost crude oil production, with the two partners focusing on attaining the 165,000 barrels of oil per day (bopd) production target by year-end 2024.
He emphasized the continued importance of CNL’s operational philosophy in maintaining network stability and facilitating gas supply especially to the domestic market.
The two partners signed documents on the conversion of five (5) OMLs into four (4) PPLs and twenty-six (26) PMLs, in line with the new PIA terms, marking a significant step towards increasing domestic gas supply and expanding global market presence.
According to the PIA, all existing Oil Prospecting Licenses (OPLs) and Oil Mining Leases (OMLs) are automatically converted to Petroleum Prospecting Licenses (PPLs) and Petroleum Mining Leases (PMLs) upon their expiration.
Nonetheless, an option of voluntary conversion is provided for holders of OPLs and OMLs (Operator, Licensees or Lessees) under the erstwhile Petroleum Profit Tax (PPT) regime. The PIA terms are generally perceived as more investor-friendly, compared to the erstwhile PPTA terms.
In his remarks, Mele Kyari, the Group Chief Executive Officer of NNPC Ltd, described CNL as one of the most reliable partners for the NNPC Ltd. “Over the years, Chevron has been a partner of choice that has not contemplated completely divesting/exiting (oil production in) the shallow water and we are proud of them,” he added.
Kyari assured CNL that NNPC Ltd would sustain its partnership with the JV partner to create more value for both parties and expand Nigeria’s footprints in the domestic and export gas markets.
He commended the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) for its exemplary role in modifying the conversion.
Also speaking Michelle Pflueger, the Director, Deepwater and Production Sharing Contract (PSC) of CNL, stressed the significance of the conversion for both companies, affirming the company’s long-standing commitment to the assets.
