NNPC: Voyage to oil quest in Northern Nigeria
Eventually, the search for hydrocarbon in the North yielded results with the inauguration of oil drilling in the Kolmani Integrated Development Project, at the Kolmani oil field site, Alkaleri in Bauchi State. Dipo Oladehinde Writes.
Nigeria, with crude oil reserves of more than 37 billion barrels and the 6th largest world producer, has discovered and launched the first oil drilling project in the north after decades of exploration.
The Nigeria National Petroleum Corporation Limited (NNPC) unveiled the discovery of hydrocarbon deposits in the Kolmani River II Well on the Upper Benue Trough, Gongola Basin, in the northeastern part of the country.
The oil wells — OPLs 809 and 810 — to be developed by Sterling Global Oil, New Nigeria Development Commission (NNDC) and NNPC Ltd, were launched by President Muhammadu Buhari on November 22, 2022.
The discovery of oil in commercial quantity in the north came 62 years after the oil and gas discovery and drilling took place in Oloibiri in South-South Bayelsa states.
The South-South region, also called Niger Delta, had since dominated oil production with highest oil and gas reserves in Nigeria.
Other states where oil was later discovered in southern Nigeria over the years are Ondo, Imo, Abia, Lagos, Anambra and Kogi.
The discovery and drilling of crude oil in Bauchi and Gombe axis is the first in the 19 northern states where millions of dollars had been spent by NNPC looking for oil.
$3 billion investment
At the launch on November 22, 2022 in Bauchi in northeast Nigeria, President Buhari declared that the government has already attracted over $3 billion investment in the oil and gas sector at a time of near-zero appetite for investment in fossil energy.
President Buhari flagged off the Kolmani Integrated Development Project, a fully integrated in-situ project comprising upstream production, oil refining, power generation and fertilizer.
“Considering the landlocked location and the huge capital requirement, the economics of the project is a challenging proposition,” he said.
“Consequently, from the outset, I instructed NNPC Limited to utilise and leverage its vast asset portfolio across all corridors of its operations to de-risk the project to attract the much-needed investment.
“It is therefore to the credit of this administration that at a time when there is near zero appetites for investment in fossil energy, coupled with the location challenges, we are able to attract investment of over $3 billion to this project.”
Subject for discussion
He said that the successful discovery of oil and gas in the Kolmani River field, and the huge investment it had attracted “will surely be a reference subject for discussion in the industry as we pursue the just energy transition programme that will culminate in our country achieving net- zero position by the year 2060”.
Noting the huge benefits the project brings to the country including “but not limited to energy security, financial security as well as overall socio- economic development of the country,” President Buhari affirmed that the government’s directive to NNPC to explore other oil and gas fields beyond the Niger Delta basin has finally yielded commendable results.
“This is indeed significant considering that efforts to find commercial oil and gas outside the established Niger Delta basin was attempted for many years without the desired outcomes.
“The successful discovery of the Kolmani oil and gas field by NNPC and her partners has finally broken the jinx by the confirmation of huge commercial deposits of hydrocarbons in Kolmani River field.
“This discovery had emanated from our directive to the NNPC to re-strategise and expand its oil and gas exploration footprints to the frontier basins of Anambra, Dahomey, Sokoto, Benue trough, Chad and Bida. Similar activities across the other basins are currently actively ongoing,” he said.
The current discovery, he explained, encompasses one billion barrels of oil reserves and 500 billion cubic feet of gas within Kolmani.
He said there was “huge potential” for more deposits as the country intensifies exploration.
Looking forward to the successful delivery of the Project which he called “another vital pillar in the Country’s economic architecture,” President Buhari urged NNPC and partners to work with all stakeholders for smooth execution of the project.
He explained that he had engaged the Governors of Bauchi and Gombe States, and have given assurances of their commitment and willingness to ensure support and cooperation in these localities as this activity affects the local populations.
NNPC Group Managing Director Mele Kolo Kyari noted that the search for oil and gas in the frontier basins of Chad, Sokoto, Anambra Platform, Calabar Embarkment, Benue Trough, Dahomey, Bida and the Ultra Deepwater Niger Delta had spanned decades without significant outcomes.
The immediate-past Chairman of the Petroleum Technology Association of Nigeria and marginal field operator, Bank Anthony Okoroaforcdescribed the commencement of the drilling campaign at the Kolmani Field as a good move.
He added that the development of any of the frontier basins was a positive action for Nigeria’s oil and gas reserves’ enhancement as well as the economic growth of country.
“It’s a good move. I think we still need to go ahead and explore the entire frontier basins. We need to ring-fence their budgets to explore them and to develop them. This will assist in getting our reserves to acceptable levels, and we have to do this quickly as long as fossil fuel is still relevant.
“So, it’s good progress, forget what anybody says. It’s going to create employment, it’s going to create revenue for government, new infrastructure will spring up in that area. So it is positive,” he said.
He noted that since the past decades when investors like the international oil companies (IOCs) were not willing to invest and explore at the frontier areas, the federal government through the NNPC had been the one exploring and footing the bill.
He said those efforts have now resulted in the volume of oil and gas discovered, with the country now, “moving to the development phase, which is positive and I give kudos to the tireless efforts of everybody who has worked very hard to actualise this.”
Also, PENGASSAN has given a thumbs up to the federal government, the NNPC and other stakeholders for efforts taken so far to end the oil theft and vandalism menace in the nation’s oil and gas industry.
The Lagos Zonal chairman of PENGASSAN, Eyam Abeng, said the group was highly satisfied with the response of the government, the NNPC and other industry stakeholders with the results seen so far in the fight against oil theft and vandalism.
Abeng said at the height of the alarming oil losses due to the massive theft and resultant shutdown of operations by oil companies, PENGASSAN activated its advocacy tool and drew stakeholders’ interest to the menace confronting the industry.
“The stakeholders realised it and stepped in and you can bear credence to the revelations that had followed. So once you identify a problem, you move toward resolving that problem and part of the resolution of that problem is the establishment of the Command and Control Centre that monitors activities of oil and gas installations in all Nigeria’s economic zones real-time, and we are working with them in reviewing each of the milestones step by step.