As the nation’s oil and gas industry awaits the passage of the Petroleum Industry Bill (PIB), there has been a decline in crude oil exploration as only 232 barrels of oil with condensates were added to the reserves in 2017.
International Oil Companies (IOCs) have consistently lamented that the continued delay in passing the PIB bill into law is creating uncertainties which delay the take-off of fresh projects worth several billions of dollars that would grow industry capacity and reserves.
For instance, Shell Petroleum Development Company (SPDC) had last year said it has put on hold investment decisions on two key offshore oil and gas projects that would cost about $30 billion until the new petroleum law is approved.
According to a Department of Petroleum Resources (DPR) report, the nation’s oil reserves grew to 36,971.91 billion barrels in 2017 against 36,739.18 barrels recorded in 2016, a difference of 232 barrels including condensates added in a year.
A further breakdown of the figure show a total of 31,419.71 billion barrels of oil and 5,552.20 billion barrels of condensates as at the end of December 2017 against 31,271.77 billion barrels and 5,467.41 billion condensates recorded in 2016.
Since its inception, the PIB has been dogged by lack of political consensus and disagreements between the government and global oil majors over its key terms and this led to the break-up of the bill, the first of which is the Petroleum Industry Governance and Institutional Framework Bill (PINGIF).
The Minister of State for Petroleum Resources, Ibe Kachikwu, had also last year lamented the loss of over $15 billion annual investment due to lack of the PIB.
The DPR report also stated that about $3.5 billion worth of inward investments are required to achieve the gas flare commercialization targets by 2020. Over 178 flare points collectively flare about 1 billion standard cubic feet of gas, about 65 per cent located onshore.
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