Posted by By Mike Oduniyi on
Production start up from the $3.5 billion Bonga deep offshore oil field has again be moved backwards.
Production start up from the $3.5 billion Bonga deep offshore oil field has again be moved backwards. It is now scheduled to commence mid next month, Minister of State for Petroleum Resources, Dr. Edmund Daukoru has said.
Consequently, the Federal Government has targeted an oil production capacity of 3.5 million barrels per day (bpd) by the first quarter of 2006.
Daukoru told THISDAY in an interview that the project promoters, the Shell Nigeria Exploration and Production Company (SNEPCO) had confirmed to him the shift in the earlier targeted month of October this year.
It was the third time that the start up of production from the Bonga field would be shifted this year, after SNEPCO had announced that from the first oil huge field would be in July 2005 and later September.
‚??It is an engineering thing so it is difficult to take a particular date, even the top Shell management they can push, only the project engineer knows realistically when it can come,‚?? said Daukoru.
‚??They have promised me September before, which was waved. Middle November is the new date that I have been told,‚?? the minister added.
Development of the field has been a subject of inquiry by the National Assembly which, worried by the continued delay in completing the project, has had to query the rising cost of the project.
The field‚??s floating, production, storage and offloading (FPSO) vessel, built at the cost of $770 million, is already moored 120 kilometers off the coast of the Niger Delta.
SNEPCO officials said production from Bonga, with estimated reserves of over 1 billion barrels of crude oil, will commence at 100,000 bpd and to quickly reach a peak production of 225,000 bpd early next year.
The field was discovered in 1996 SNEPCO, who is to operate the field on behalf of the license holder, the Nigerian National Petroleum Corporation (NNPC) under a Production Sharing Contract (PSC) agreement.
Other partners are Esso Exploration and Production Nigeria Limited (20 per cent), Elf Petroleum Nigeria Limited (912.5 per cent), and Nigerian Agip Exploration Limited (12.5 per cent).
Daukoru said further that with the expected output from the Bonga field as well from ExxonMobil‚??s Erha deep offshore field, Nigeria‚??s oil production capacity will rise by about 500,000 bpd to 3.5 million bpd by first quarter next year.
According to him, with the continued rise in global oil demand, the extra capacity will boost the Nigerian government revenue as ‚??this is light sweet crude, not heavy crude.
The minister however, added that it was time Nigeria de-emphasises revenue accruing directly from oil exports if the country was to achieve real economic growth.
Daukoru said that with an annual income of about $12 billion of petroleum revenues a year, it would still not bring riches to every Nigerian given the country‚??s population put at about 150 million.
‚??Oil revenue too much dominates the economies of producing countries. Not only oil whether it is coal or other natural resources. We really must move away from depending on exhaustible sources of energy, if we are talking of the growth of our economy on sustainable basis,‚?? said the minister.
‚??We must add value...As it is, there is hardly any value added, our GDP growth is very, very small because most of the exports are really on an enclave basis, they have very little bearing on the wider economy.
There are countries that produce anything that is a direct source of revenue, no natural resources but simply human skills. What we can do with petroleum revenue is to put conditions for people to realize themselves and for them to develop their skills. Only that way we can generate sustainable wealth,‚?? he said.
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