Nigeria is among 10 producing countries with highest cost of crude oil production per barrel, it was gathered at the weekend.
Chairman/Managing Director, ExxonMobil Affiliate Companies in Nigeria Paul McGrath, who spoke in Lagos, said the Federal Government needed to address some issues in the petroleum industry to achieve major milestones in the industry.
McGrath, also the Chairman, Oil Producer Trade Section (OPTS), Lagos Chamber of Commerce and Industry (LCCI), said targets such as increased investment inflow, increased oil reserves and daily production as well as sufficient in-country refining and domestic gas utilisation, may remain wishful thinking if issues drwaing back the industy are not addressed.
He described the country as the largest oil producer in Africa and with hydrocarbon prospects among the brightest in the world. “However, there are fixes to be put in place if it aspires to maintain and expand the investment profile in the hydrocarbon industry,” he added.
“Nigeria ranks among the top 10 countries with highest cost of producing oil per barrel and its equivalent in gas. High cost is a major disincentive to investment, especially at this time of considerable global competitiveness. Operating costs are increasing due to attendant increase in required maintenance and well work-overs. Security costs are escalating as peculiarities of the business environment require additional resources to be deployed to secure our people and assets,” he said.
The Nigerian National Petroleum Corporation (NNPC) also said it would grow the country’s crude oil reserves to 40 billion barrels by 2025 from 37 billion barrels.
NNPC’s Group Managing Director, Mallam Mele Kyari, spoke at a conference with theme: Harnessing the oil and gas potential for national Development.
Kyari also said the Corporation will grow oil production to three million barrels per day (bpd) from the current 2.2 million bpd by the same period.
Represented by the Corporation’s Chief Financial Officer, Mr Umar Isa Ajiya, the GMD said the attainment of these targets by 2025 were part of efforts to optimise the potential of the petroleum industry for rapid economic development.
He said: “From the NNPC’s point of view, we are working with our partners to grow the national reserves to 40 billion barrels by 2025 and further improve crude oil production to three million barrels per day during the period. To achieve these targets, we are not oblivious of the fact that huge investment is required across the value chain.
“The corporation is planning to open up the midstream, complete all critical projects targeted at delivering about three billion standard cubic feet of gas daily to the market and further ensure the closeout of investment decision on the Nigerian Liquefied and Natural Gas’ (NLNG) Train 7, and improve domestic utilisation to boost power generation and industrial growth.”