$10 A Barrel Oil Production Achievable With Digitizations

Yemisi Izuora

The Federal Government is optimistic that incorporating digitization ion oil production process is key to reducing the huge Unit Operating Cost (UOC) of producing crude oil in the country to $10 per barrel by December 2021.

Technical adviser to the Minister of State for Petroleum Resources on Gas Business and Policy Implementation, Justice  Derefaka, made the assertion on Thursday at an Exploration and Production (E&P) Industry Cost Reduction Webinar.

It had as its theme: ” Building Digital Competencies To Improve Asset Management Efficiency In The Nigerian Oil And Gas Sector. “

Derefaka said, ” Now more than ever, oil and gas organisations are using technology to drive down production costs to improve margins as they fight prolonged drops in oil prices.

“The driving objective of this webinar is to discuss the imperatives for E&P companies in the Nigerian oil and gas sector to achieve operational excellence in asset management, toward realising a UOC of $10/bbl by 2021.

“One of the main drivers for the achievement of this initiative is digitalisation.”

According to him, apart from investing in digitalisation and modern technology, oil and gas companies need to train their workforce periodically to harness its benefit.

He said, ” Investment in technology and workforce capacity and competence development are essential to surviving current market conditions.

“The key challenge to a digital oil and gas company that would successfully transform through technology and emerge stronger from the crisis appears to be a competency gap.

“Presently, a significant share of companies do not have the competencies necessary to realise the technology’s investment value.”

Derefaka said the Minister of State for Petroleum Resources,  Chief Timipre Sylva, was committed to reducing the UOC of producing crude oil which was still over $20.

He said that the Federal Government was also targeting production of three million barrels per day, which could be achieved by digitalisation and deployment of modern technology by oil and gas companies.

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