The Senate Committee on Gas wants to talk to officials from the Nigerian National Petroleum Corporation, NNPC, Limited. They want to know why the NNPC hasn’t given money for exploring and developing new areas for oil and gas.
The Chairman of the Committee, Jarigbe Jarigbe, spoke at a press conference after having a private meeting with the Chief Executive Officer of the Nigerian Upstream Petroleum Regulatory Commission, Gbenga Komolafe, and his team.
Remember that the Petroleum Industry Act, PIA, 2021, created the Frontier Exploration Fund to help with exploring and developing new areas for oil and gas in Nigeria.
Some of these pieces of land are located in places like Anambra, Benue, Dahomey, Bida, Sokoto, Chad, and other areas where the search for oil and gas has not happened yet.
The PIA allows for the funding of these projects. The fund will be made up of 30 percent of NNPC’s earnings from oil and gas contracts. This money will be used to cover the costs of exploring and developing new projects.
Jarigbe mentioned, “We had a meeting with the CEO of NUPRC and his team to learn about what the agency has been doing.
“According to Section 9, subsections 4 and 5, it states that the NUPRC should have a Frontier Acreages exco account for exploring and developing new areas of land. This fund needs to be approved by the National Assembly.
Furthermore, according to section 22 subsection 1 of the Petroleum Industrial Act, it states that the National Assembly is responsible for overseeing the budget and spending of the NUPRC.
So, we had to talk to the commission about those problems and we found out that the fund mentioned in Section 9 subsection 4 of the PIA, which is supposed to come from 30 percent of oil profit and 30 percent of gas profit, doesn’t actually exist.
We also plan to communicate with the NNPCL about that. We don’t know the budget because we weren’t given any specific amount. We will find out more information and let you know.”
Committee members mentioned that gas is becoming a major alternative source of funding for countries that have it.
Nigeria, they explained, cannot afford to miss out on the race to fully benefit from this God-given resource. Therefore, it is important to take advantage of the opportunity while it is available.
Earlier, the CEO of NUPRC, Gbenga Komolafe, repeated this idea in his statement.He said, “Gas is really important for making money in our country, just like oil, it’s also really important.”
Besides the fact that gas has been acknowledged as a transitional fuel, we, in the commission, are concentrating on increasing our gas production.
Kimolafe said that Nigeria has 37 barrels of crude oil and a reserve of 208 tcl of gas, which makes Nigeria the country with the largest gas reserve in Africa and the ninth largest in the world.
He said that Nigeria was getting stronger in producing gas, even though they were working hard to make sure they could make money from it.
Komolafe also mentioned, “According to our records, we had 206 thousand cubic liters of gas last year, and this year it increased to 208 thousand cubic liters by September.”In 2021, we produced 7.52 trillion cubic liters (tcl) of gas. However, in 2022, the production decreased to 6.9 tcl. As of September 30 this year, we have recorded a daily gas production of 7.07 tcl.
As a commission, we understand how important gas is to our country. In our work to regulate different activities, we are making it a priority to speed up gas production in the nation.
The CEO of NUPRC also mentioned, “Right now, our commission is exploring areas with untapped gas resources. As part of our own efforts, we have identified all the fields with unused gas.”
Our goal is to work with the industry until we can collect the gas molecules and sell them through a fair auction process, following the rules and regulations set by the PIA and other provisions.
We think that exercising will help our country use gas more effectively instead of just keeping it in reserves.
However, he stressed that the main problem hindering gas production was a lack of money and the necessary infrastructure.
