The President of Nigerian Association of Petroleum Explorationists (NAPE), Dr. Andrew Ejayeriese, has stated that claims by the federal government to achieve 40 billion barrels in reserves by the year 2020 are not feasible.
The Federal Government, through the Nigeria National Petroleum Corporation (NNPC), announced an outlook for 2018 to increase crude oil reserve by 1billion barrels year on year, from its current 37billion barrels to 40 billion barrels by 2020.
The Group Managing Director NNPC, Dr. Maikanti Baru, disclosed in Abuja in July that there will be an increase in national oil daily production to 3million barrels per day (bpd).
According to him, “Internally, for NNPC’s upstream subsidiary, the Nigerian Petroleum Development Company (NPDC), the plan is to grow its production to 500,000 bpd of oil and 1.5billion standard cubic feet per day (bscf/d) of gas by 2020.
“There is no gainsaying the fact that capital and investment thrives when there are clear policies, strong regulatory framework and institutions, fiscal stability and adherence to high governance codes.
To spur much needed investment, government has issued an updated oil and gas policy, initiated the process for enacting a new Petroleum Industry Governance Bill that provides clarity on the Government institutions and their roles in the Industry.”
However, Dr. Ejayeriese said such target is not feasible because there is no conducive fiscal regime that attracts investment in new discoveries that may lead to increase in reserves.
According to him, “Nigeria should allow professionals to manage the oil and gas sector. Marginal fields bid round should be left for professionals and not politicians. There should be a framework that allows frequent bid rounds to take place irrespective of the party in power.
“For instance, the framework may allow for the bid round to take place every four years irrespective of which party is in power. Focus should not be on the Niger Delta alone. Another factor is lack of sanctity of contract which must be respected. Such action is discouraging investors from coming to Nigeria. Without investment in new frontiers,
it may be impossible to achieve the target of 4o billion barrels reserves by 2020.”
