Buhari to NNPC: work with indigenous oil producers

• President Buhari

President Muhammadu Buhari yesterday assured indigenous companies operating in Nigeria’s oil and gas sector of the full support and protection of his administration.

He promised during a meeting with members of the Independent Petroleum Producers Association at the Presidential Villa, Abuja to do everything within his powers to address the challenges they currently face.

A statement by the Senior Special Assistant on Media and Publicity to the President Mallam Garba Shehu, said he commended their determination to increase the participation of Nigerians in the country’s oil industry.

He directed the management of the Nigerian National Petroleum Corporation (NNPC) to work closely with the indigenous oil producers to resolve the problems which they enumerated to him.

“We have the manpower for a more effective participation in our oil industry. We will  give you all possible encouragement.  You certainly won’t be ignored under my leadership,” President Buhari told members of the association which represents about  20 Nigerian companies operating mainly on onshore fields.

President Buhari assured the Nigerian oil producers that the administration will take appropriate actions to maintain and enhance security in their areas of operation, noting that better security will help to lower production costs, which, he said, had become unnecessarily high in the country.

Mr. Austin Avuru, who spoke on behalf of the Nigerian oil producers, told the President of challenges currently being faced by the group such as security and the funding of joint ventures with the NNPC.

He said the indigenous oil producers were already making significant contributions to the development of the economy and could do more with the support of the administration.

Avuru, the chief executive officer of Seplat Petroleum, told reporters after the meeting that given the necessary backing, the Independent Petroleum Producers Group (IPPG) could raise Nigeria’s domestic oil refining capacity to 1.2 million barrels daily by the year 2020.

Stressing that IPPG is made up of indigenous companies responsible for over 200,000 barrels of oil production and over 900 million cubic feets of gas production per day, he said it is a very significant segment of the upstream sector of the oil and gas industry.

He said: “It was one of the points we raised with the President, we think that by 2020 domestic refining capacity should not be less than one million barrel of oil per day in domestic refining.

“We actually put 1.2 million barrels domestic refining capacity per day and that falls on our doorstep as indigenous operators.

Asked how the target would be achieved, he said: “It will be achieved. Some construction is already ongoing by indigenous companies and between some others which are coming in with smaller sized refineries and in partnership with the NNPC. We are confident that by 2020 we will deliver 1.2 million domestic refining capacity.

“We thought it was necessary to engage the President, then fortunately the Vice President, permanent secretary, GMD of NNPC were all there. So it was a very useful discussion.” he added

Speaking further on the necessity of the visit to the President, he said: “Because if you watch the way the oil and gas sector is evolving, increasingly the key segments of the oil and gas industry, the onshore segment and the swamp, oil is now falling into the hands of Nigerian Independent, and which is why in the past five years, we have made so much investment over $9 billion in just acquiring these assets and over $1 billion each year in work programme investment and this is growing.

According to him, the group is seeking ways to become a very critical partner to government in the delivery of natural gas and other products into the domestic economy.

He said that the group called for the meeting with the President as it identified with all his policy direction.

He said: “We realised we are very critical partners that he needed to know about and to engage with very early in the administration of the President. So, we called for the meeting and he obliged us.

“Mr President was very receptive and promised that all the help and support we need to succeed as indigenous producers, we will get it. Specific requests will go to the GMD when we engage him.

“What happened today was all parties, stakeholders and all our partners in government, that is partner to indigenous operators in government were present at this engagement. Of course, we would now follow it up with more specifics when we meet with the GMD of the NNPC.

He said that the indigenous companies do not have to take over from the multinational but will compliment each other.

He said: “The multinational are going into some areas which we are unlikely to go into. Deep offshore, LNG, and whereas the onshore terrain and delivery of gas to domestic market, these have become our frontiers.”

On the about 200 barrel per day production, he said: “That is 10 per cent today. Just in the past five years, up from near zero, and we anticipate that in the next 5years (by 2020) we will account for 30 per cent production of about three million barrels per day, that is very significant especially when in addition to that, we account for half of the total gas delivery to the domestic market. We can get as high as seven PCF per day by 2020.”