Posted by By JULIANA FRANCIS on
Minister of State for Energy (Petroleum) Odein Ajumogobia (SAN) says that about 39.2 billion dollars was allocated to develop the nation's oil and gas industry in the last eight years.
Minister of State for Energy (Petroleum) Odein Ajumogobia (SAN) says that about 39.2 billion dollars was allocated to develop the nation's oil and gas industry in the last eight years.
He spoke yesterday in Abuja on a position paper, 'Reflections on the Nigerian Oil and Gas Industry", at a two-day conference to mark 50 years of commercial oil production in Nigeria.
Noting that the oil and gas sector is highly capital intensive, Ajumogobia said that for instance, its budgetary allocation from the Federal Government between 1999 and 2007 averaged 4.9 billion dollars per year. 'With this level of investment and the quota restriction by OPEC, Nigeria exports on the average about 2.14 million barrels per day (mmbpd).
'Nigeria has an aggressive production capacity expansion plan that targets a robust portfolio of supply development plans from 2007 to 2010, 'That will grow capacity from about 3mmb/d currently to 4mmb/d," he said.
Ajumogobia said that the sector contributed about 90 per cent of government's revenue and 95 per cent of the country's foreign exchange earnings.
According to him, an estimated annual spending of about 15 billion dollars and 20 billion dollars is anticipated, going forward in Nigeria's exploration and production sector on capacity growth and exploration.
'This puts Nigeria in the forefront among OPEC peer countries in terms of capacity growth investments.
'While average forecast OPEC capacity addition is estimated at about 3.3 per cent annually between 2005 and 2010, Nigeria's planned capacity growth translates to a growth rate of about 6.5 per cent annually. 'Nigeria is therefore well positioned to play a critical role in global crude oil supplies," Ajumogobia said. The minister said the feat supported the national aspiration to grow GDP from current level of seven-to-eight per cent annually to double digit.
He recalled that oil exploration and production grew steadily in the last eight years, with crude oil reserves moving from 28 billion barrels in 1999 to 34 billion barrels in 2007. Within the period, he said, production capacity increased to about 2.6 million b/d. Ajumogobia attributed the growth to joint venture operations, the introduction of alternative funding scheme and the emergence of new production sharing contract arrangements.
He said that government embarked on several oil block licensing rounds in 2000, 2005, 2006 and 2007.