Main Ad
  • FG banks on oil proceeds for sustainable development
  • FG banks on oil proceeds for sustainable development

    crude oil

    By Udeme Akpan, Energy Editor

    Despite its over 60 years involvement in petroleum exploration and production, Nigeria has not been able to utilise the product, also known as ‘black gold’ to stimulate the development of other sectors of the nation’s economy.
    Consequently, the nation’s Gross Domestic Product, GDP, continues to rise and fall, based on the fortune and misfortune of oil, which price, currently hovers at about $54 per barrel, compared to about $140 per barrel, recorded in 2008.
     In its latest report obtained by Vanguard, PricewaterhouseCoopers Limited, stated: “Along with most countries of the world, the Nigerian economy is technically in a recession, as real GDP contracted for the second time by 3.6 per cent in the Third Quarter, Q3 2020. This implies that, on a year-on-year basis, real GDP declined by N1 trillion and N670 billion in Q2 and Q3 2020 respectively. The share of Nigeria’s real GDP loss in the period is larger than the economies of Sierra Leone, Liberia, Gambia, Lesotho, among others.”
     It added: “With this contraction, Nigeria is experiencing a second economic recession in less than a decade, due to the impact of the COVID-19 pandemic on the global economy. So far in Q3 2020, except for China, other economies have recorded consecutive economic contractions, as the global economy is expected to decline by 4.4% in 2020 from an uptick of 2.8% in 2019, according to the IMF.”

    READ ALSOFG donates relief materials to over 2,000 IDPs in Zamfara — Commission

    National Oil and Gas Excellence Centre
    However, the situation might change in the medium and long term, as President Muhammadu Buhari, and others have indicated interest to work toward the diversification of the nation’s oil-dependent economy. Speaking at the commissioning of the National Oil and Gas Excellence Centre, President Buhari, said: “The establishment of the National Oil and Gas Excellence Centre (NOGEC) aligns with my administration’s commitment to foster stability, growth and sustainability of the Nigeria Oil and Gas Industry consistent with the economic development and sustainability agenda articulated in the National Petroleum Policy 2017, National Gas Policy, 2017, Economic Recovery and Growth Plan (ERGP) and the Economic Sustainability Plan (ESP), 2020. At the beginning of my administration, we set a clear roadmap for the oil and gas sector in order to deepen value from the nation’s huge resource potentials and create opportunities for investors, both local and foreign, when I declared that: ‘Nigeria is Open for Business!’ I am delighted that since then, we have witnessed major Final Investment Decisions in the sector such as the AKK Pipeline project, the NLNG Train-7 project, and the completion of the 5,000barrels per day Waltersmith Modular refinery.”
    Economic Diversification
    He said: “Our renewed drive for economic diversification using the oil and gas industry as a pivot remains on track as we expand government revenues and deploy it to grow our Gross Domestic Product (GDP), generate employment and eliminate poverty – all for the overall benefit of Nigerians. This ceremony of the official launch of the National Oil and Gas Excellence Centre (NOGEC) – an integrated resource complex to drive Safety, Value and Cost efficiency in the Industry – is yet another milestone in the development of the oil and gas sector and the realisation of greater value for all stakeholders.”
     “There is no doubt that year 2020 was unique and, indeed, one-of-a-kind. Global economies faced unprecedented challenges and severe shocks in the wake of the COVID-19 pandemic and attendant consequences therefrom. Our dear country was not spared from the impact of the ‘triple force’ of COVID-19, Oil price crash and OPEC+ production cuts with direct impact on government revenue projections and national economy. However, we are emerging stronger and more resilient in 2021 owing, in part, to efforts of the agencies of the Ministry of Petroleum Resources who work under my leadership and the direct supervision of the Honourable Minister of State, Petroleum Resources, to keep oil & gas production levels stable, optimise government revenues, and ensure domestic energy security, to mention but a few. The creation of the National Oil and Gas Excellence Centre (NOGEC) at this time is a further demonstration that the Nigeria Oil and Gas Industry has come of age, even against all odds.”
    According to him, “NOGEC will serve as oil & gas industry cost-reduction centre and the hub for industry best practices, technical support and competence. NOGEC will also act as the oil and gas tecno-economic bureau to support the Government and its entities in policy development and implementation efforts. Above all, the Integrated Centre will enhance the contribution of the oil and gas sector to the nation’s GDP as well as strengthen Nigeria’s position as the regional leader in the oil and gas industry.”
     Also speaking, the Minister of State for Petroleum Resources, Chief Timipre Sylva, said: “NOGEC has been carefully designed to support the achievement of the ministerial priorities – significant amongst which are cost reduction, increase in production, and value maximization in the industry. The Centre, under the direct supervision of the Department of Petroleum Resources (DPR), will leverage the existing capacity of the National Data Repository (NDR) as the principal data warehouse of the industry to drive initiatives that will enhance Safety, Value and Cost-efficiency across all operations in the Industry.
    “The establishment of the NOGEC is not only a response to a safer, cost-efficient and sustainable oil and gas industry, but also a strategic move to position Nigeria as the regional and global leader in cost efficiency, breakthrough solutions and value-added services for the industry. Accordingly, and to achieve the afore-mentioned three-prong value drivers of Safety, Value and Cost efficiency, the integrated NOGEC complex encompasses some units, including the Search, Rescue and Surveillance (SeRAS) Command & Control Centre, National Improved Oil Recovery Centre (NIORC), Oil & Gas Alternative Dispute Resolution Centre (ADRC), Oil & Gas Competence Development Centre (CDC), and Integrated Data Mining & Analytics Centre (IDMAC).
     “Let me take a few moments to highlight the main elements of each of these centres to underscore its role in driving cost reduction, increasing production and enhance value for the Industry. Search, Rescue and Surveillance (SeRAS) is a flagship programme of the Centre designed to enhance safety management, emergency preparedness & response and routine transportation for bed space management. SeRAS will therefore drive cost reduction and improve operational efficiency across the Industry. Conservatively, it is projected that upon full implementation of SeRAS, the annual industry expenditure for offshore & remote locations flight logistics and emergency response will reduce by 50% – a significant gain towards our target reduction of cost-per-barrel across our operations.
     “The National Improved Oil Recovery Centre (NIORC) on the other hand, is designed to promote the implementation of Improved and Enhanced Oil Recovery technologies/methods to arrest the incidences of production decline and resultant high cost in many assets, especially in the matured Niger Delta Basin. In essence, NIORC will trigger secondary and tertiary recovery operations in the industry.
    The Centre will collaborate with operators, global technology centres, international oil & gas regulators and other relevant parties to leverage experiences and best practices for application in Nigeria. Expectedly, the foregoing measures will result in reserves growth, production increase, field life extension, improved asset life cycle cost and reduced cost-per-barrel, all with positive impacts on the national economy and investors’ profitability.”
    Furthermore, the Director/CEO, Department of Petroleum Resources, DPR, Engr. Sarki Auwalu, added: “The National Oil and Gas Excellence Centre encompasses industry-focused programmes that will drive strategic mediation in operations, skills and competence development, use of Big Data, Internet of things (IoT) and Artificial Intelligence (AI) for decision making, deployment of proven technology for secondary and tertiary oil recovery as well as a coordinated response for an emergency. We have concluded the framework and implementation modalities for the successful take-off of these Programmes within the National Oil and Gas Excellence Centre due for imminent commissioning. We have no doubt that the Industry now has the resource and platform to interact, cooperate and collaborate on salient industry issues that remain impediments to cost reduction, safe operations and optimum value optimisation.”
    However, in a telephone interview with Vanguard, some experts, including Prof. Omowumi Iledare, Ghana National Petroleum Corporation (GNPC) Professorial Chair in Oil and Gas Economics and Management, Institute for Oil and Gas Studies, University of Cape Coast, Ghana, described the establishment of NOGEC as a step in the right direction.

    The post FG banks on oil proceeds for sustainable development appeared first on Vanguard News.

    No comments:

    Post a Comment