The new commission
further stated that 20 companies which won the bids had partially paid up,
among those who won the 57 oilfields.
In May 2021, the
Department of Petroleum Resources (DPR) which transmuted into NURPC with the
enactment of the Petroleum Industry Act (PIA), concluded the 2020 marginal
oilfield bid round, the first successful exercise since 2003, when 24 assets
were put on offer.
The process which
culminated in the presentation of letters to the bid winners in Abuja, by the
industry regulator, started in June 2020, with 57 marginal fields spanning
land, swamp and offshore put up for lease by the federal government.
Marginal fields are
smaller oil blocks typically developed by indigenous companies and have
remained unproduced for a period of over 10 years.
Some of the companies
which emerged winners at the time included: Matrix Energy, AA Rano, Andova Plc,
Duport Midstream, Genesis Technical, Twin Summit, Bono Energy, Deep Offshore
Integrated, Oodua Oil, MRS and Petrogas.
A few others that
succeeded in crossing the hurdle and had fully satisfied all conditions were:
North Oils and Gas, Pierport, Metropole, Pioneer Global, Shepherd Hill, Akata,
NIPCO, Aida, YY Connect, Accord Oil, Pathway Oil, Tempo Oil, Virgin Forest
among others.
At the time, it was
also a big win for local oil and gas companies in the country, which had a good
outing during the ceremony as 100 per cent of the beneficiaries of the exercise
were indigenous entities.
Nigeria last conducted
marginal field bid rounds in 2003, with 16 of the fields contributing just two
per cent to the national oil and gas reserves.
The commission also
stated that its target revenue for 2022 remained N3.38 trillion, substantially
exceeding its 2021 revenue projection of N3 trillion and that of 2020 which was
pegged at N1.746 trillion.
In a presentation it
made to the Senate Committee on Petroleum, Upstream, led by Senator Bassey
Akpan, during an oversight meeting at its headquarters in Abuja, the commission
led by Mr. Gbenga Komolafe, explained that it hit N1.99 trillion revenue in
2020, surpassing its forecast of N1.746 trillion by about 13.98 per cent.
But in 2021, with a revenue target of
N3.066 trillion, the commission which was then known as DPR pointed out that it
generated N2.711 trillion, achieving 88.45 per cent of its revenue forecast
which is usually paid into the federal government coffers.
It stated that in spite of the reduced
fiscal provision in the PIA, the commission was set to achieve its desired
revenue target for 2022.
Furthermore, the commission lamented that
with the Organisation of Petroleum Exporting Countries (OPEC) production quota
of 1.683 million bpd in January and 1.701 million bpd in February, it is only
able to pump 1.396 million bpd currently, leading to a loss of at least 115,926
million bpd on a daily basis, put at roughly $300 million monthly.
“We are losing about 115, 926 barrels per
day, so that literally translates to roughly about $300 million and that’s a
huge loss to a nation that actually requires these funds,” he stated.
The commission’s chief executive, Komolafe,
attributed the underperformance to mostly oil theft, sabotage, vandalism as
well as technical issues, including ruptures associated with the assets.
“But the larger percentage is due to crude
oil theft and as a commission we know the impact of this and recognising our
regulatory role, we have been able to reach out to other operators as to what
we can do about this.
“We are trying to put in place an
industry-wide initiative to ameliorate the situation and we are expecting to go
live in terms of implementation in collaboration with the Nigerian National
Petroleum Company (NNPC) and the other stakeholders,” he added.
However, he stated that despite the
encumbrances, it would continue to promote an enabling environment for
investment in the upstream petroleum sector, establish, monitor and regulate as
well as enforce environmental measures and optimise government’s take from the
country’s hydrocarbon resources.
In addition, the commission vowed to ensure
compliance with the terms and conditions of leases and licences granted,
enforce all laws relating to upstream operations as well as maintain a
petroleum industry data bank.
Komolafe, responding to issues raised by
the senators on the environmental degradation in the Niger Delta, stated that
there are provisions in the PIA which provide for remediation.
He stated that the commission recognises
that the job was enormous and had set up an internal committee to liaise with
the senate steering committee to work on regulations for the industry.
The commission’s chief executive stated
that if fully implemented, the PIA would take care of issues connected with the
environment, adding that while some pollutions are attributable to normal oil
operations, others could be credited to sabotage by other parties.
In other issues, the commission revealed
that it expects its new office to be completed in January 2023, while the total
handing over will be done in the first quarter of 2024.
In his comments, leader of the senate
delegation, Akpan, along with his deputy, Ifeanyi Uba, and other members of the
team, who spoke, urged the commission to expedite action on regulations
concerning the community trust fund.
In addition, the senators urged the
upstream commission to deploy technology in taming oil theft as well as work
towards reducing the cost of production per barrel of crude oil.
Akpan vowed that the committee will
continue to put all stakeholders on their toes, including the commission,
explaining that by now the commission should have finished with preparing some
regulations in line with the timelines provided by the PIA. “As a regulator,
you should have timelines,” he stated.
The senate committee, upstream, explained
that the PIA remains work in progress, stating that all grey areas in the law
will be ironed out in the next set of amendments.
The committee urged Komolafe to relate
closely with it if there is any pressure from any quarters, stating that the
Minister of State, Petroleum, Mr Timipre Sylva, had told it that the agencies
were given a free hand to operate.
“We are going to put you on your toes.
Nobody will pity you. We will come here even twice a month. So, let us know
what you are doing because this is a very serious mandate given to you by Mr
President,” Akpan noted.