Dr Victor Ekpenyong, an oil industry expert, says the country should leverage on existing oil reserves to boost oil production to earn more to meet revenue shortfalls.
Ekpenyong, Chief Executive of Kenyon International West Africa Ltd., a Well Control Services firm, made the call during an interactive session with journalists in Yenagoa on the state of the oil industry.
Ekpenyong, who applauded the Nigerian National Petroleum Company Limited (NNPCL) for ongoing repairs on major oil export pipelines, noted that upon conclusion of repair schedules, export capacity would rise significantly.
He noted that vandalism and oil theft have hampered the country’s oil production and kept the nation from harnessing its full production capacity.
He explained that oil production was being limited by breach of pipelines that evacuate crude from oilfields to export terminals.
He noted that with the rebound of the Forcados Export Terminal which has been out of service, there will be an increase of export capacity by at least 350,000 barrels per day (bpd) when scheduled repairs on the export trunkline is completed in the next one week.
He said that there was the need to revive idle assets to boost oil production to meet the Organisation of Petroleum Exporting Countries (OPEC) quota of 1.8 million bpd quota for Nigeria.
Ekenyong noted that there was existing production capacity to meet the shortfall in production from a little over one million bpd current output.
“Reports available from NNPCL have it that repairs on Trans Forcados Export Trunkline is almost concluded and the Forcados Export Terminal will be up again and it has capacity to handle up to 400,000 bpd of oil export.
“The sections of the Trans Niger Delta Pipeline (TNP), which feed the Bonny Crude Export Terminal, are also scheduled to be ready as well, so we need to revamp the idle wells to produce enough to meet our OPEC quota and earn more revenue,” Ekpenyong said.
He noted that the country is yet to produce more and leverage the supply cuts occasioned by the Russian-Ukrainian crisis which has pushed up international crude oil prices.
He noted that proposed divestment by the government from oil assets in non producing oil reserves would provide opportunities for investors to enter into partnerships with the government to increase oil production.
He noted that the challenges being faced due to the deregulation of the downstream sector would be overcome as soon as efforts to increase domestic refining capacity begins to yield results.
“The efforts being made by the government to increase local refining is very massive. I learnt that the rehabilitation work at the Port Harcourt refinery has gone far for the President to promise that the plant will be back in December.
“There is also ongoing work in Warri Refinery and these will increase local production of refined petroleum products and reduce imports and subsequent pressure on the naira at the foreign exchange market,” Ekpenyong said.
He said that NNPCL remained the dominant importer of refined petroleum products and expressed that the US$3 billion facility being put in place by the government would enable more private sector players to augment the supply deficit.
