President Muhammadu Buhari on Tuesday flagged off the oil exploration of the Kolmani Integrated Development Project in the North-East, which has attracted over $3 billion in foreign direct investment with the potential of producing 50,000 barrels per day.
The Flag-off Ceremony of the Kolmani Integrated Development
Project, a fully integrated in-situ development project comprise of upstream
production, oil refining, power generation and fertilizer.
Buhari said, “The oil exploration at the Kolmani River
located between Gombe and Bauchi states has already attracted over $3bn foreign
direct investment and will boost Nigeria’s fortunes and earnings.
“The project is expected to start with a daily production of
about 50,000 barrels of crude oil.”
He also said over 1 billion barrels of oil reserves and 500
billion cubic feet of gas were discovered within the Kolmani area and the huge
potential for more deposits as we intensify exploration efforts.
The event was attended by Senate President, Ahmad Lawan,
Bola Tinubu, the presidential candidate of the All-Progressives Congress (APC),
Timipre Sylva, minister of state for petroleum resources and Mele Kyari, group
chief executive officer, Nigerian National Petroleum Company (NNPC) Limited.
Others include Bala Mohammed governor of Bauchi, Inuwa
Yahaya, governor of Gombe, Simon Lalong governor of Plateau and Shehu
Mai-Borno, the group managing director of the New Nigeria Development Company.
The NNPC had in 2019 announced the discovery of crude oil in
the Kolmani River region at the border community between the Bauchi and Gombe
states.
Section 9 of the Petroleum Industry Act (PIA) signed by the
President established the Frontier Exploration Fund (FEF) with the allocation
of 30 percent of the profit from NNPC’s upstream oil and gas contracts for the
purpose of oil exploration in Kolmani as well as Anambra, Dahomey, Bida, Chad
and Benue Trough.
According to Buhari, considering the landlocked location and
the huge capital requirement, the economics of the project is a challenging
proposition.
He said, “From the outset, I instructed NNPC Limited to
utilise and leverage its vast asset portfolio across all corridors of its
operations to de-risk the project to attract the much-needed investment.
“It is therefore to the credit of this administration that
at a time when there is near zero appetite for investment in fossil energy,
coupled with the location challenges, we are able to attract investment of over
$3 billion to this project.”
While commending NNPC and her partners for the successful
discovery of oil and gas in the Kolmani River Field, Buhari said the huge investment
the project had attracted will surely be a reference subject for discussion in
the industry as we pursue the just energy transition programme that will
culminate in our country achieving net-zero position by the year 2060.
He also said the benefits the project brings to the country
include energy security, financial security as well as the overall
socio-economic development of the country.
President Buhari affirmed that his administration’s charge
to NNPCL to explore other Oil and Gas fields beyond the Niger Delta Basins has
finally yielded commendable results.
According to Buhari, this is indeed significant considering
that, efforts to find commercial oil and gas outside the established Niger
Delta Basin were attempted for many years without the desired outcomes.
He also said the successful discovery of the Kolmani oil and
gas field by NNPC and her partners has finally broken the jinx by the
confirmation of huge commercial deposits of hydrocarbons in the Kolmani River
field.
“This discovery had emanated from our charge to the NNPC to
re-strategize and expand its oil and gas exploration footprints to the frontier
basins of Anambra, Dahomey, Sokoto, Benue trough, Chad and Bida Basins. Similar
activities across the other basins are currently actively ongoing,” he said.
“We are pleased with the current discovery of over 1 billion
barrels of oil reserves and 500 billion cubic feet of gas within the Kolmani
area and the huge potential for more deposits as we intensify exploration
efforts.”
Looking forward to the successful delivery of the Project
which he called “another vital pillar in the Country’s economic architecture,”
President Buhari urged NNPC and partners to work with all stakeholders for the
smooth execution of the project.
He said, “I have engaged the Governors of Bauchi and Gombe
States, and both have given me assurances of their unwavering commitment and
willingness to ensure support and cooperation in these localities as this
activity affects the local populations.
“I urge the NNPC and NNDC, and their Strategic partners to
ensure all lessons learnt from our years of experience as an oil-producing
nation are utilized to ensure harmonious relationship with the local
communities.”
In his remarks, Timipre who recalled his relationship with
the project expressed his delight to be associated with the project as Minister
having worked with a former minister of petroleum resources when NNDC won the
oil prospect lease being flagged off Tuesday.
Also speaking at the event, Kyari said the search for oil
and gas in the frontier basins of Chad, Sokoto, Anambra Platform, Calabar
Embarkment, Benue Trough, Dahomey, Bida and the Ultra-Deepwater Niger Delta had
spanned decades without significant outcomes.
“The singular determination of Buhari to ensure optimum
exploration and exploitation of our natural resources and your Excellency’s
consequential directives for NNPC Limited to strategies and utilise available
human, technological and other material resources to prosecute exploration
activities in all Frontier Basins resulted in the discovery of commercial oil
and gas deposits in the Kolmani Prospect in April 2019,” Kyari added.
There were also goodwill messages from governors of Bauchi,
Gombe, Plateau state, the chairman northern governor’s forum and Tinubu.