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NNPC plans N2.9trillion investment in oil exploration

Posted by thephctelegraph on 2006/07/21 | Views: 371 |

NNPC plans N2.9trillion investment in oil exploration


The Nigerian National Petroleum Corporation (NNPC) has projected an investment level of $22 billion (N2.9 trillion) to boost oil....

The Nigerian National Petroleum Corporation (NNPC) has projected an investment level of $22 billion (N2.9 trillion) to boost oil and gas exploration and production activities between 2005 and 2010 thereby increasing the country's crude export into the international market.

Group Managing Director of NNPC Mr. Funsho Kupolokun, who disclosed this at an international conference recently in Abuja, said though this level of funding poses a major challenge to the operators, significant progress has been made in mitigating the challenge through innovative alternative funding schemes.

The NNPC boss said that Nigeria has recorded increasing success in securing favourable interest rates and less onerous demands by the banks.
Kupolokun stated that before the end of this year, the oil sector would have achieved 500,000 barrels additional crude oil production capacity from several development projects in the industry.

He said: "Bonga commenced production in December 2005 and is currently producing about 200,000 barrels per day, while Erha with additional 210,000 barrels per day is expected to be on stream in the second quarter of 2006. Other smaller fields are to add about 150,000 barrels later this year".

According to him, in the gas sector, flares have reduced drastically to about 40 per cent by the end of last year.
Kupolokun noted that significant growth in domestic and export gas utilisation will end gas flaring by 2008 in the country in line with government zero flare level.
"Already, gas sector demand growth in Nigeria is particularly unprecedented and it is expected to grow from 1.5 billion cubic feet per day by 2010".
He stated that in order to facilitate the growth level in the gas sector, a gas master plan has been put in place, which will ensure maximizing the effect of gas in the domestic economy and optimising Nigeria's share and competitiveness in high value export market.
"The master plan is being developed to facilitate timely and cost effective gas capacity additions to meet the unprecedented demand. Phase one of the plan was completed in 2005, while phase two commenced in 2006", he stated.
The NNPC boss explained that the phase one of the plan proposed five concepts include use of central processing facilities, integrated pipeline network, uniform pricing mechanism, standardized gas specifications in gas grid reserves growth.

Kupolokun said that in the area of Liquefied Natural Gas (LNG) project, the country has made a significant progress, which places the second fastest growing in the globe with a growth projection of 50mtpa by the year 2012.
He added that train four of the LNG was commissioned in November last year, putting additional 10,000 tons per day while a train five is being commissioned with train six now under construction.

Kupolokun also spoke on the progress made at the Olokola LNG with plan to develop 22mtpa LNG capacity to global market from 2010.
Similarly, the Brass LNG project is on course with the Front End Engineering Design (FEED) nearing completion and Final Investment Decision (FID) planned for the end of this year, while the first cargo is expected in the fourth quarter of 2010.

At regional level, he said the West African Gas Pipeline project (WAGP), Gas Supply to Equatorial Guinea and the Trans- Saharan Gas project to Europe via Algeria.
According to him, the 630 kilometre pipeline WAGP is now near completion in preparation for commissioning this year, adding that the project is expected to monetise 200mmscf per day and provide a platform for regional economic growth through provision of affordable gas to the neighbouring countries.

He stated that gas supply to Equatorial Guinea under study as about 600mmscf per day is to be supplied to the country by 2009, noting that pre-feasibility study has been completed, with the agreement expected to be signed by both countries.

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