FG Mulls Harmonized Oil Sector Data-Bank To Boost Investments

Kenneth JukporOctober 25, 2022

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NNPC To Supply 300,000 BPD To Dangote Refinery The Nigeria National Petroleum Company (NNPC) Limited will have the first right of refusal to supply the Dangote refinery with about 300,000 barrels of crude oil per day for the next 20 years. The Group Chief Executive Officer, NNPC Ltd, Mele Kyari, disclosed this to journalists when he appeared at the 49th Session of the State House Ministerial Briefing organised by the Presidential Communications Team, at the Presidential Villa, Abuja. A supply of 300,000 per day in 20 years brings the total supply to 2.1 trillion by the NNPC. According to him, the corporation had succeeded in locking down the huge supply as part of the Federal Government’s means of guaranteeing sufficient petroleum products supply for Nigeria. “We have secured the right to sell up to 300,000 barrels of crude oil to the Dangote refinery for the next 20 years. Not only that, by right, we also have access to 20 per cent production from that plant,” he said. He alleged that stolen crude oil products were now stored in places of worship such as churches and mosques. He also noted that various law enforcement agencies had arrested 122 persons involved in pipeline vandalism and oil theft from April to August of 2022. This was as he justified the government’s recent move to hire private entities to safeguard the network of oil pipelines crisscrossing the country. According to him, the NNPC operatives discovered that stolen petroleum products were stored in places of worship with the consent of the clergy, members and neighbours. He claimed that in one instance, at least 295 illegal connections were spotted on a 200km stretch of pipeline. “As you may be aware, because of the very unfortunate acts of vandals along our major pipelines from Atlas Cove all the way to Ibadan, and all others connecting all the 37 depots that we have across the country, none of them can take delivery of products today. “The reason is very simple. For some of the lines, for instance, from Warri to Benin, we haven’t operated them for 15 years. Every molecule of product that we put gets lost. You remember the sad fire incident close to Sapele that killed so many people. We had to shut it down and as we speak, we have a high level of losses on our product pipeline. “You remember Lagos, when a fire outbreak happened on one of our pipelines. We discovered that some of the pipelines were actually connected to individuals’ homes. And not only that, with all sensitivity to our religious beliefs, some of the pipelines and some of the products that we found were in churches and mosques,” Kyari said. He explained that the spate of vandalism had prompted NNPC Limited to shut down its network of pipelines conveying petroleum products across theft-prone areas. “When we say we are losing 700,000 barrels of crude oil per day, we mean it. This is an opportunity lost. There is no company that will produce oil and then you lose 80 per cent of that and continue to produce the oil.” The NNPC chief said the government’s response to oil theft had led to the arrest of 122 persons between April and August, 2022. — Dangote Refinery

As part of efforts to drive investments in the nation’s oil downstream sector, the federal government is planning a holistic and innovative data bank that would guide industry investors and guarantee stability in the sector.

The Permanent Secretary, Federal Ministry of Petroleum Resources, Ambassador Gabriel Tanimu Aduda revealed this while speaking at the ongoing 16th OTL Africa Downstream Week in Lagos.

Aduda, who was represented by the Deputy Director, Downstream Department, Ministry of Petroleum Resources, Engr. Augustine Okwudiafor, noted that the government is considering Machine Learning, Artificial Intelligence (AI) and other innovative approaches for data collation.

FG Considers Harmonized Industry Data To Boost Oil Sector Investments — R-L: The Chairman, Advisory Board, Oil Trade Logistics (OTL) Africa Downstream Week, Mr Adetunji Oyebanji; Chief Executive Officer, Nigerian Midstream and Downstream Petroleum Regularly Authority (NMDPRA), Engr. Farouk Ahmed; and the Chief Executive, National Petroleum Authority (NPA) Ghana, Dr Mustapha Abdul-Hamid; at the ongoing 2022 OTL Africa Downstream Week in Lagos.

His words, “As we are aware, data is key in the Oil and Gas Industry – a reliable and accurate data gives Investors a certain level of assurance. Hence, the government is keen and determined to harmonize all Downstream Data across the relevant Agencies/Parastatals to eradicate data variations.”

“In light of the above, Government through the Ministry of Petroleum Resources, its Agencies and Federal Ministry of Science and Technology is considering enhanced technologies such as Machine Learning (ML) and Artificial Intelligence (AI) to monitor and gather downstream data for effective policy formulation and investment guidance.”

Noting the huge financial burden imposed on the Nigerian treasury by subsidy payments, he asserted that full deregulation of the oil sector would increase the level of transparency in businesses and create healthy competition among the Investors.

He also stressed that full deregulation of the sector would significantly reduce the diversion and smuggling of petroleum products across the nation’s borders.

“All hands are on deck towards the full deregulation of the downstream sector, as this will ensure commercialization and liberalization of the sector, increase investment opportunities, create more jobs and promotes seamless energy transition. All these measures and many more would cushion the projected impact of downstream sector deregulation on consumers and the economy at large,” he explained.

Meanwhile, the Chairman, Advisory Board, OTL Africa Downstream Week, Mr. Tunji Oyebanji opined that liberalization and not just deregulation was what the industry needed.

Oyebanji equally expressed optimism that a free market will allow more stability, transparency and competitive prices in the nation’s oil downstream sector.

Also speaking, the Chief Executive, National Petroleum Authority (NPA), Ghana, Mr. Mustapha Abdul-Hamid confirmed that Ghana has been able to achieve commendable deregulation most petroleum products.

Speaking on the menace of emissions from transport vehicles in the region, he opined that transiting to auto-gas will help in reducing the gas emissions from automobiles.