Economy

Nigeria’s daily crude production in 2018 stood at 2.019m barrels – NNPC

Written by Maritime First

…As FG approves 100% acquisition of Afam Genco shares***

The Nigerian National Petroleum Corporation (NNPC) on Monday indicated that the national average daily crude oil production in 2018 was about 2.019 million barrels.

The NNPC Group Managing Director, Dr Maikanti Baru indicated this at the 12th International Conference of the Nigerian Association for Energy Economics (NAEE), in Abuja, while reeling out some of the achievements of the corporation under his watch, in his keynote address.

He also said that the volume of crude produced translated to an increase of 9 per cent above the 2017 average of 1.86 million barrels; stressing that it was a significant improvement from the unimpressive production level recorded on assumption of office in July, 2016.

“To underline this, the Nigeria Petroleum Development Company (NPDC) in 2018 posted a production growth of 52 per cent compared to 2017 (i.e from an average of 108kbod in 2017 to 165kbod in 2018)”, he said .

On nationwide fuel supply , he said that the corporation established a petroleum products task force that helped it to achieve a steady supply of products accross the country, adding that a total of 1.2 billion litres was sold in 2018 as against 1.1 billion litres in 2017, representing seven per cent increase.

“This was achieved through addition of 40 new affiliate and leased stations bringing the network to 618 stations nationwide.

“NNPC Retail has also moved from loss making to profitability,” he added.

On Joint Venture(JV) cash, Baru said that the corporation negotiated settlement of the Pre-2016 JV Cash Call Arrears and also championed indigenous cash exit/JV self-funding mechanism.

“So far, we have repaid over 1.5 billionn dollars out of the 5.1 billion dollars cash call arrears to date, a development that has not only restored the confidence of International Oil Company JV partners, but has also led to improved reserves growth and crude oil production.

“It was quite fulfilling that in 2018, that’s for the second year in a row, we concluded the fiscal year without any cash call arrears, he said .

The GMD further noted that NNPC made remarkable inroads in frontier exploration within some inland basins of the country.

He said topmost on this said was the Kolmani River-II Well which was inaugurated in February by President Muhammadu Buhari.

“So far, our operations, there are progressing satisfactorily, with drilling so far at over 10,000 feet with tremendous prospects,”he said .

“There was also the Chad Basin which was halted by the security situation in the area. The Basin received new vigor with the successful Spud-In of Kolmani River Well II at an elaborate ceremony by President Muhammadu Buhari.

On Gas Supply to Power In 2018, he said that the national average daily gas production stood at 7.90bscf.

This, he said represented an increase of three per cent above 2017 average daily gas production of 7.67bscf.

“Of the 7.90bscfd produced in 2018, an average of 3.32bscfd (42%) was supplied to the Export market, 2.5bscfd (32%) for Re-injection/Fuel Gas, 1.3bscfd (16%) was supplied to the domestic market and about 783mmscfd (10%) was flared.

“Domestic gas supply capacity was marginally stable at about 1700mmscfd with an average of 1.3bscfd actually supplied to the domestic market,” he added

He noted that of the 1.3bscfd supplied to the domestic market, an average of 761mmscfd was supplied to the power sector while 470mmscfd was supplied to the industries and the balance of 69mmscfd was delivered to the West African market through the West African Gas Pipeline (WAGP). 

Meanwhile, the Federal Government has granted approval to three consortia to participate in the financial bids opening for the acquisition of 100 per cent shares in Afam Electricity Generation Company.

A statement by Amina Othman, Head, Public Communications, Bureau of Public Enterprises (BPE) on Monday in Abuja, said that the National Council on Privatisation (NCP) gave the approval after its first meeting in 2019, held on April 12.

The companies were Diamond Stripes Consortium, Transcorp Power Consortium and Unicorn Consortium.

According to her, the three consortia met the benchmark score of 750 points after evaluation in accordance with the criteria set out in the Requests for Proposal (RfPs).

She said that other decisions taken by the council included approval for Quest Electric Nigeria Limited to proceed to the financial bids opening stage for the re-privatisation of the Yola Electricity Distribution Company (YEDC).

It also approved the appointment of Lead Capital Consortium as Financial Adviser for the restructuring, recapitalisation, and partial privatisation of the Bank of Agriculture (BOA).

The council appointed Vesta Healthcare Partners as consultants to carry out diagnostic review of the Nigerian Health Secto.

It delisted Transcorp Hilton Hotel, Abuja from post Privatisation monitoring by the BPE.

Also decided on was the privatisation of the Nigeria Communication Satellite Limited (NIGCOMSAT) through a strategic core investor sale and commencement of the process of listing it in the schedule of the Public Enterprises (Privatisation& Commercialisation) Act 1999.

Othman said that the privatisation of Afam Electricity Generation Company, which encapsulates, Adam Power Plc and Afam Three Fast Power Limited, could not be concluded during the first round of the power privatisation in 2013 due to issues stemming from gas supply to the plant.

“Following the termination of the Share Purchase Agreement (SPA) signed between Taleveras (the then Preferred Bidder) and BPE in 2016, council at its first meeting of 2017 held on August 22 and 23, approved the privatisation of the enterprise based on a strategy to be recommended by the Transaction Advisers.

“For the YEDC, although it was successfully privatised and handed over to the core investor in 2013, a force majeure was declared in 2015 by the core investor citing insecurity in the North-East region of the country.

“Following this, the company was duly repossessed by the Federal Government,” she said.

According to her, it is expected that the successful bidders will be responsible for operating the generation and distribution companies.

She said they would also make the necessary investments to improve the generation and distribution networks and customer service in line with the objectives of the federal government set out in the National Electric Power Policy (NEPP).

The BPE was created through the Public Enterprises (Privatisation and Commercialisation) Act 1999, to diversify the economy and strengthen the private sector as Nigeria’s engine of growth and economic driver. 


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