FG’s concerted efforts push Crude production to 2.35m BPD

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Maikanti Baru
  • As Osinbajo tells investors: Invest in Nigeria or regret in 10 years

Federal Government’s efforts towards ensuring sanity in the Niger delta and measures to boost crude production may have handsomely paid off as the  nation’s current crude oil production had risen to 2.35 million barrels per day.

The Nigerian National Petroleum Corporation (NNPC), Group Managing Director (GMD), Dr. Maikanti Baru confirmed this on Monday, at the inauguration of  the   members of the corporation’s  re-constituted anti corruption committee in Abuja.

Highlighted Baru: “In the upstream, we have  also been making strides  in the stability and security in the Niger-Delta and  production is coming back steadily.

“At one point, we have reached the level of almost 2.35 million barrels per day, including condensates, which accounts for about 400,000 barrels per day”, Baru stated, expressing his sincere joy that petroleum products supply in the country was also being sustained, attributing the current feat to conscious management’s plan and the committed support of the staff and other industry stakeholders.

“ I want to  thank  each member of staff and our clients involved in the supplies of petroleum products and other services  in the country, for sustaining the supply of petroleum products across the country; the status quo has been restored.

“We are in the period of  ease, it is not too long ago in December,  January and February, when  NNPC was a sole importer of petroleum products in this country with the challenges associated with distribution and the caped  price of N145  to a liter of petrol.

“We got some ease when the international price went down and the importers decided to come back to import because they can make some margin; they have raised the importation level to  about 30 per.“

He said it was  important  to  keep  the  stability of  the supply of petroleum products ongoing.

The NNPC GMD  also said the corporation was committed to exiting  the cash call, noting that the Federal Government  had provided the required support.

“As you are aware, we have committed to exiting the cash calls process and government has been very supportive and they have given us all approval and endorsement in that direction, particularly the economic council  and the entire three tiers of government have endorsed this project, and we have started the implementation.“

He affirmed that the four Joint Venture Projects NNPC signed with its JV partners would result into incremental revenue for the country within the less than 10 years of the  lifespan of the projects.

He said  that  the  projects were attracting the inflow of foreign direct investments in the nation’s oil and gas sector.

The NNPC GMD said: “In our joint venture  project with  Chevron, we have attracted an  over subscribed 1.2 billion dollars Foreign Direct Investment.

“The E and P joint venture with NNPC attracted 800 million dollars foreign direct investment which was signed up  in May.

“Last week in London, the NNPC, Shell Agip and Total joint venture attracted over  1 billion dollars  foreign direct investment.

“The Chevron, NNPC  Joint venture project is 780 million dollars worth of  investments.“

Baru also said that the projects would serve as an avenue for the corporation to exit the JV cash call.

“The JV cash call has components; we have to pay arrears of about six billion dollars that were incurred in 2016 in JV operations.

“We  are paying up  about one billion dollars 2016 arrears we started in April; we have paid in 400 million dollars and we hope to pay the balance before the anniversary of the first payment.“

According to him, NNPC, on behalf of the government, will ensure  that every surplus from the corporation at the end of the year after deducting the cost of operation, will be returned to the national treasury.

In the meantime, the acting President, Yemi Osinbajo, on Monday re-echoed the need for foreign investors to invest in Nigeria, warning that they would regret their inaction in the next 10 years.

He also said the Federal Government was injecting over N701bn into the power sector.

Osinbajo spoke at a meeting with delegates from the Nigerian Initiative for Economic Development at the Presidential Villa, Abuja.

He said, “The world is a much smaller place and it gets smaller by the day.  I like the point that was made by the DG of the Nigerian Investment Promotion Commission that anyone who doesn’t invest in Africa or Nigeria, in 10 years’ time, they would be queried by their establishment, that ‘you just missed out on the best possible opportunity’ and you know that it is not easy to miss out on the best possible business opportunity.”

Osinbajo recalled that there was pessimism when the first set of telecommunications licences were to be issued in the country especially because Nigeria had only 400,000 telephone lines at the time. He stated that about a year after issuing the licences, all the major telecommunications companies that did not invest in the sector found themselves holding the short end of the stick.

He said such firms later realised their mistake because in five years, a firm like MTN had shown that the sector in Nigeria “was just incredibly profitable.”

He said, “They had made profit in one year.  MTN alone now has something in the order of about 12 million or so lines if not more, and that’s one of the telecommunications companies that we have.

“So, really, Nigeria is a place that is waiting to happen and it will happen. That’s really the point. It will happen. The truth of the matter is that any country that opens itself to free enterprise, the way Nigeria is opening itself to free enterprise, will somehow find that it will work.

“That is one of the critical things that we are bringing into the mix. We are insisting that the only way that this country can make the profit that it needs to make is by private sector investment, beginning with local investment.”

On the power sector, Osinbajo said the Federal Government would be infusing N701bn into the value chain to free up the sector.

“The power sector is almost completely privatised but we have had difficulties because of tariffs, for example. Many times you look at our power sector, we have an installed capacity of about 12,000 megawatts today but we are only able to put on the grid under 5,000, a little above 4,000 megawatts.

“What we need to do is to make this profitable for the private sector.  So, we are working on the whole value chain.  We are trying to free up that value chain, beginning with working on tariffs.”

Additional report from Punch