‘‘Recently, the Group Managing Director of the NNPC, Maikanti Baru predicted that oil fields would soon dry up. To fill the gap, Nigeria is in dire need to explore new oil fields to shore up its oil reserve. Chika Izuora, in this piece, looks at various options available for the country.’’
The search for oil in other frontiers aside from the volatile Niger Delta dates back several decades ago.
In its frantic search for oil beyond the Niger Delta, the Exploration and Exploitation (E & E) Division of the Nigerian National Petroleum Corporation, NNPC in 1977 commenced exploration activities in the Chad Basin, and the project continued up to 1996.
During the campaign, 23 wells were drilled out of which two recorded non-commercial gas discoveries (Wadi-1 & Kinasar-1) thus leading to suspension of exploration activities in the Chad Basin in the year 2000 for lack of commercial finds.
Again between 1993 and 2000, the government awarded blocks in the Gongola Basin to Chevron, Total and Shell Nigeria Exploration and Production Company (SNEPCo).
The companies acquired 3,153km of 2D seismic data, and drilled one well each. One of the wells drilled, Kolmani River-1 made non-commercial gas discovery (33Bscf) and by the provision of the contract agreement between the Federal Government and the IOCs, the minimum work commitment was fulfilled and the companies suspended operations and relinquished the blocks.
However, in 2002, the government directed further evaluation and consolidation of the data generated in the Chad basin to further ascertain the prospectivity of the Basin.
The study formed the basis for the exploration re-entry in 2009 with the acquisition of over 1,900 Sq.km 3D seismic data before the suspension of activities in November, 2014 due to security challenges occasioned by the insurgency in the North East.
Already, the NNPC has awarded the contract for seismic data acquisition of over 500Sq.km 3D seismic data in the first instance to the Integrated Data Service Limited (IDSL) a subsidiary of NNPC and Bureau for Geophysical Prospecting, a subsidiary of China National Petroleum Corporation (BGP/CNPC).
All of these are parts of efforts, to grow the country’s reserve base and create a buffer following unabating militancy in the oil rich Niger Delta.
The Group Managing Director of the NNPC, Maikanti Kacalla Baru, has further justified the huge amount of money being thrown into the oil search campaign.
Baru said the country needs to increase its oil and gas reserves, as he stressed that Nigeria’s 2016 national average daily oil production of about 1.9million barrels when compared to its current oil reserves of about 35billion barrels can only last for about 40 years,if no reserves are added.
Nigeria, a major crude oil producing nation, needs funds to bolster its dwindling oil reserves and production after seeing its revenues dropped sharply due to low global crude prices and declines in production.
He told members of the Nigerian Association of Petroleum Explorationists (NAPE) during a dinner organised in his honour recently, that with current gas reserves of 187Tcf and at the current level of production of 8Bscfd, Nigeria’s gas reserves will last for about 65 years also assuming there are no added reserves.
Baru predicted that by 2020, Nigeria’s gas demand forecast for both domestic and export would experience a rapid growth to 15bscfd, meaning that current reserves level can only sustain such a quantum of demand for just 35 years.
President Muhammadu Buhari perhaps worried by such situation, had on assumption of office directed the state owned oil company to take more positive steps toward oil exploration activities in some of the inland basins which include the Chad Basin and the Benue Trough.
The Chad Basin and Benue Trough are believed to have substantial deposits of oil and gas hydrocarbons.
The GMD in meeting with the presidential directive visited the Governors of Bauchi and Gombe States, Barr Muhammed Abdullahi Abubakar and Dr Ibrahim Hassan Dankwambo respectively where he officially announced to them the resumption of oil and gas exploration in the Gongola Basin segment of the Benue Trough which includes areas within the two States.
These areas include Alkaleri, Darazo, Misau and Ganjuwa (in Bauchi State) and Akko, Dukku, Billiri, Balanga, Funakaye and Nafada (in Gombe State).
While Governor Abubakar promised to provide offices and accommodation for all NNPC staff involved in the project, Governor Dankwambo nominated two of his Commissioners to support NNPC with logistics towards the project’s success.
The GMD was also at the Palaces of Emir of Bauchi, Alhaji Rilwanu Suleiman Adamu, Emir of Gombe, Alhaji Abubakar Shehu Abubakar III and Emir of Misau, Alhaji Ahmed Suleiman where the Royal Fathers gave the assurance to sensitise and educate their subjects on the resumed NNPC operations and the need to cooperate with NNPC personnel and safeguard the Corporation’s heavy equipment which will soon be deployed within their domains.
India And China To The Rescue
Following the crash in oil price in the international market and contraction in oil production following militant activities in the Niger Delta, the government’s revenue base has shrunk that it is considering borrowing to fund the 2016 budget