The Nigerian Petroleum Development Company, NPDC, is the exploration and production arm of the NNPC. It was established in 1988 to enable the Nigerian National Petroleum Corporation, NNPC, meet its objective of being a major player in the upstream sector of the oil and gas industry.
Over the years, the company could not fully realise the objective for which it was set up as a result of lack of cooperation from past administrations, some of which actually stripped the company of some of its very prolific acreages.
In the past there were instances when assets belonging to the company were taken and given to some other companies. But all this has become history. In recent past, assets that were recently divested by Shell have been handed over to the company as an operator. These include OMLs 26, 30, 34 and 42.
However, since the inception of the President Goodluck Jonathan administration and the push from Diezani Alison-Madueke, the minister of Petroleum Resources, to ensure that the company is able to achieve its objective, it is gradually marching towards the realisation of its destiny.
But with this support from the government industry operators are still of the opinion that the company may not be able to perform optimally to the satisfaction of the other stakeholders in these blocks that were divested. To them, private sector operator would have been in a position to optimise the value of these assets as they are largely considered as part of the large group of the Nigeria National Petroleum Corporation, which is attached to the apron string of the government.
They believe that the organisation is going to be bugged down by bureaucratic processes which would adversely affect the NPDC’s ability to make those fields realise their full potentials.
This march towards enhancing the performance of NPDC actually started in 2010 when the Minister of Petroleum Resources gave the NPDC a target of producing 250,000 barrels per day by 2015. As at that time, NPDC’s production was just 65,000 barrels per day.
Since the target was set in 2010, NPDC has made tremendous progress. As at today the company is producing 130,000 barrels per day representing a 100% growth in production.
Speaking recently, Alison-Madueke assured that under her watch the 250,000 barrels per day crude oil target by 2015 given to the NPDC would be realised. She noted that efforts to replicate the feat of doubling the company’s production over the next few years to meet the target is on course stressing that to sustain that tempo of production growth the company has since commenced an aggressive drilling program.
The NPDC successfully drilled two new wells in its OML 119. The wells, Okono 6 and 7 are currently producing 12,000 barrels per day. This is by no means a mean feat especially considering the fact that these wells are producing an average of 6,000 barrels per day in an area where most of the wells around produce an average of between 2,000 and 3,000 barrels per day.
In spite of these successes, the communities where these wells are located feel alienated and that the impact of the oil company is yet to be reflected on their daily lives hence some of them are beginning to protest against the company. It is true that the communities might be considered as not having stakes in terms of eq uity shareholdings. This is not enough for them not to benefit from the activities of the company.
The company plans to drill more wells as from this year and would deploy two more rigs in addition to the two it currently has on site, adding that the target is to drill 40 wells in the next five years as part of its growth projection.
Currently, plans are underway to meet and possibly exceed the 250,000 barrels per day target by 2015. NPDC’s plan to grow production is not restricted to drilling more wells. It includes well repair and maintenance activities aimed at boosting reserves to ensure sustainability.
For instance, the company carried out repairs on some of its wells in OML 26 in June last year. This helped to double production from those wells contributing to the company’s current 130,000 barrels per day production.
Sustaining the tempo of reforming the administration of subsidy scheme
Sustaining the tempo of the reformation agenda of the administration in the oil subsidy scheme is germane to the sustainability of the downstream sector of the petroleum industry.
A reform that would eventually lead to a deregulation policy which if carefully implemented will stimulate the economic growth and social wellbeing of the Nigerian populace. Nigerians would ultimately have no choice but to allow the sector to be deregulated because the amount of money that is being expended on subsidy scheme is still outrageous.
Over N1 trillion is currently being spent on the subsidy scheme because the nation’s four refineries are not functioning. The state of the refineries are below 20 percent even though the government and officials of the NNPC would tell whoever cares to listen that they are working above 60 percent. The Kaduna Refinery and Petrochemical Company do not produce more than one million litres of petrol.
Of course the abounding opportunities and benefits that are associated with deregulation far outweigh the short run cost discomforts that the citizens think they would go through if the sector is deregulated.
Stories by OLUSOLA BELLO
