The Nigerian Petroleum Development Company (NPDC) an upstream subsidiary of the Nigerian National Petroleum Corporation (NNPC) has explained that drop in electricity generation due to gas supply constraint was as a result of oil facilities vandalisation.
The company said that the vandalisation of the Forcados trunk line by militants in 2016 gravely impacted gas production by NPDC and its JV partners for power generation.
Managing Director of the NPDC, Mr. Yusuf Matashi made the explanation in a presentation to the House Committee on Local Content.
According to a statement by NNPC spokesman, Ndu Ughamadu, Matashi said the attack which primarily led to a loss of about 70 per cent of NPDC’s crude oil production capability also had an effect on gas production.
“Unfortunately gas production in the region we operate is not non associated gas but associated with the crude oil we produce so by the time we shut in the oil well, we also shut in most of the gas, that is why we now see the level of gas supply shortage for power generation,’’ he said.
He said though other operators might have other reasons for the shortfall in gas supply in their domain, the damage of the Forcados export terminal supply line was the biggest obstacle to the production of gas by the NPDC and its JV Partners.
Matashi however said that the company would increase its gas production by as much as 50 per cent whenever the Forcados line is back on stream.
Describing the impact of the attack as immeasurable, the MD said within the last one year, the company has struggled to mitigate the effects on its production.
On the NPDC local content compliance level, Matashi noted that as an indigenous exploration and production company, the NPDC is in sync with the letters and spirit of the provisions of the Nigerian Content law in the oil and gas industry.
Chairman of the House Committee on Local Content, Emmanuel Ekon, said members of the Committee would in due course embark on an oversight visit to NPDC facilities for proper appraisal of the company’s compliance level with the extant law on local content.