The group managing director, GMD, of the Nigerian National Petroleum Corporation, NNPC, Maikanti Baru has put Nigeria’s untapped oil reserve in excess of 11 billion barrels.
This reserve Baru said presents unprecedented investment potentials for interested investors.
He also revealed that Nigeria’s deepwater operations have generated revenue exceeding $180billion following industry players’ capital investment in excess of $65billion with the potentials for growth amidst untapped abundant opportunities in the sector.
The GMD, made this disclosure while delivering a paper entitled: “Deepwater Operations in Nigeria: The journey so far” at the Panel session of the Petroleum Technology Association of Nigeria (PETAN) in the ongoing golden anniversary of the Offshore Technology Conference (OTC) in Houston, Texas.
Represented by the Chief Operating Officer, Upstream of the NNPC, Mallam Bello Rabiu, Dr. Baru stated that Nigeria held approximately 13billion barrels of oil, out of which about 2billion has been produced with a huge volume yet untapped.
Dr. Baru said Nigeria remained an active player relative to other regions in terms of deepwater development, stressing that the industry started with the deployment of latest technology, a stride it has continued to maintain.
“Out of the 15 Floating Production Storage and Offloading (FPSO) in Nigeria, seven have been deployed for deepwater operations. Nigeria ranks only behind Angola within the African deepwater operations in terms of FPSO deployment,” Dr. Baru informed.
According to the GMD, the country has utilized each deepwater project as an avenue to upscale its unique human capital skills in different areas not limited to engineering design, project management, welding and diving.
He added that the local content contribution or services share in deepwater had continued to grow and improve from the sub 1 per cent level to an aggregate contribution of over 25 per cent from engineering man-hours of less than 20,000 to over 1.1million in recent Egina project.
“With the Nigerian content, tonnage has grown by 600 per cent from the first deepwater project till date,” Baru noted.
The GMD stated that deepwater projects had benefited the wider Nigerian economy by boosting demand for a range of goods and services, including offshore vessels and platforms, materials, floating hotels, helicopters and manpower, creating jobs and providing wide range of training and maintenance services to the industry locally.
He added that services in areas such as manpower supply, logistics, and vessel supply, chemical supplies had more or less been domesticated in the deepwater value chain.
Dr. Baru, who averred that the recent further demonstration of this was the in-country topside integration on the Egina FPSO project, saying this had achieved the dual goal of both industrialisation and manpower development through job creation and skill acquisitions.
“The gains enumerated in terms of production and reserve growth, revenue and value creation, manpower and technology development need to be sustained. I must reiterate that sustaining these gains means all hands must be on deck. We must leverage the expected growth in deepwater for national development. We expect within the next 10 years that production from Nigeria deepwater would double,” Dr. Baru posited.
He said that the development implied increase in steel demand, as steel represents 20 per cent to 35 per cent of the overall cost for a new-build structure, dry docking, pipe coating, welding and sundry ancillary services, adding that that Nigeria needed the right caliber of technical and engineering skills and manpower.
The GMD urged the players in the deep water sector to start, beginning from now, to create the linkages to the local economy, saying that the local economy must be able to deliver the growth aspirations or support adequately the demand of tomorrow.
Dr. Baru called on the Petroleum Association of Nigeria (PETAN) to fill the technology gap, stressing that OTC provided not just a window to the global Oil and Gas Industry but also a gateway for Nigeria and the Nigerian Oil Industry to access the best of technology and contribute to national development.
He said NNPC would continue to support planned deepwater projects, while ensuring adequate local participation.
The Oil Industry expert said Nigeria had experienced phenomenal growth in deep water operations. “At my last count, about 10 deepwater projects are lined up for sanctioning. Also, given the lead time for project maturation, the time to build is now for us to achieve the results we desire, seizing the chance to develop our Oil and Gas Industry and by extension the economy.”
Dr. Baru noted that there were 87 deepwater blocks in Nigeria, out of which only sevem are producing and additional six at different phases of development. He stated that more than half of the blocks in deepwater Nigeria are open.
He congratulated PETAN for organising the grand event and for bringing together the Oil and Gas Industry stakeholders from Nigeria and other climes to discuss such an enriching theme with the hope that the investors would go the extra mile to develop the industry, its businesses and the Nigerian economy, while giving value for money.
On his part, PETAN Chairman, Mr. Bank Anthony Okoroafor, applauded the GMD and the NNPC for always supporting the development of Indigenous Oil and Gas companies, saying that the future of the Oil and Gas Industry in Nigeria and by extension the nation’s economy was the deepwater operations of the country.
The highpoint of the panel session was a call on all industry players to pull resources together for the growth of the deepwater operations in Nigeria to leverage on technological trends for the benefit of the Nigerian economy.