Two years after the discovery of over one billion barrels of crude oil in the North, Nigerian National Petroleum Corporation Limited (NNPC) has commenced the acquisition of 90 square kilometres of three-dimensional (3D) seismic data in Nasarawa State in the north of the country.
The project, christened ‘Kiana’, is being carried out by the Integrated Data Services (IDSL), the geophysical prospecting and data processing subsidiary of NNPC according to an Africa Oil & Gas Report. The crew recently completed over 1,200-line kilometres of two dimensional (2D) seismic data in the Bida and Sokoto basins.
“The interpreted data from the Kiana project is expected to define at least one prospect that will be drilled before the fourth quarter of 2022,” the intelligence report added.
Believed to be President Muhammadu Buhari’s pet project considering that he started the agitation over 40 years ago, this journey is costing Nigeria millions of dollars despite the warning by petroleum engineers, investment experts and geologists who insist on geography of the zone may not guarantee a commercial find.
The president, who has been resolute on the possibilities of oil discoveries in the North since he was petroleum commissioner over 40 years ago, gave NNPC a marching order to explore hydrocarbon deposits across the federation immediately after he assumed office on May 29, 2015.
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“We are on top of it. We have been following up with them. Right now, they are in the process of drilling an enhanced well, where they will do their appraisal and locate where the actual production of oil will take place. From there, then, we move on,” Nasarawa state’s Governor Abdullahi Sule said on April 4.
This wild goose chase according to experts has gulped about N149.4billion since its inception, this amount is exclusive of the $340 million, and an additional N27 billion committed by the Federal Government in seismic expeditions since the beginning of the search for oil in the new frontier.
Even if commercial hydrocarbon deposit is discovered, those who are conversant with investments in the sector say the NNPC’s plan to resume exploratory activities in the Chad Basin would seriously be hampered by economies of scale projections, insecurity and the unwillingness of oil companies to drill outside the Niger Delta with already proven reserves.
“If you do the cost-benefit analysis, you can see that it is not viable in the short and medium-term,” said Henry Boise, Petroleum Economics, Management and Policy Researcher at Emerald Institute for Petroleum and Energy Economics, Policy Strategy, University of Port Harcourt.
Also, NNPC’s quest for more oil exploration is also coming at a time traditional oil investors and big oil companies are coming under a plethora of attacks from all directions, ranging from uncooperative financiers and investors amidst a global shift to renewable energy to hostile governments and hardline climate activists.
Already, the New York State’s pension fund, one of the world’s largest investors with $226billion in assets, said it will drop many of its fossil fuel stocks in the next five years and sell its shares in other companies that contribute to global warming by 2040.
