By Adewale Sanyaolu
Except urgent steps are taken, Nigeria, one of the top crude oil producers in world may soon become a net importer of the same commodity, the Independent Petroleum Producers Group (IPPG) warned yesterday.
The Group equally further painted a gloomy picture, saying that Nigeria in the near future risks not meeting its domestic refinery crude demand.
Chairman of IPPG, Mr.Abdulrazaq Isa, disclosed this in his industry address at the ongoing Nigeria Oil and Gas (NOG) 2024 Energy Week in Abuja
ââThis trend in production portends another frightening dimension when we consider that in the not-too-distant future our overall installed domestic refining capacity, currently closing in on about 1.2million barrels per day, may soon outstrip our current crude oil production level with the risk of Nigeria finding itself in a position where it is unable to meet its domestic refinery crude demand or even become a net importer of crude oil, God forbidâ, he said. The warning by IPPG may not be unconnected with the frustration currently faced by the Dangote refinery and other modular refinery operators in accessing crude oil locally.
The development has forced the 650,000 barrels per day refinery to begin crude oil imports from the United States of America.
Also of concern to the group is the countryâs attempt of running a partial 2024 budget implementation due to an estimated deficit of 400,000 barrels per day (bpd) from the forecasted 1.78 million bpd.
According to Isa, without prejudice to some laudable goverment policies and the gradual positive turnarounds being experienced, the industry remains in dire need of extraordinary efforts to ensure sustainability.
The IPPG boss argued that despite Nigeriaâs world class hydrocarbon resource base, with over 37 billion barrels of proven crude oil reserves and 207 trillion cubic feet (tcf) and 600 tcf of proven and contingent gas reserves respectively, Nigeria finds itself in a situation where its daily production has significantly slumped to about 1.3 million barrels of oil and 8.5 bcf of gas today.
This, he said, was way below the acceptable capacity as a nation and by all globally acceptable standards, the reserves to production ratio is extremely low and a clear indicator that the industry is in a dire situation. To reverse the ugly trend, IPPG has listed four priority areas which included; the immediate conclusion of all pending International Oil Companies (IOCs) divestment transactions, the urgent need to address deepwater development and production, the adoption of a national value-retention strategy and the development of Nigeriaâs gas resources to catalyse economic growth and complement decarbonisation drive.
According to Isa, these priority areas provide the most realistic and sustainable pathway towards meeting our national long term production aspiration of four million bpd and 13 billion cubic feet of gas per day.
ââConsequently, as a matter of national importance, Nigeria must act fast and hasten the pace of recovery across the entire industry, even if it means Mr. President declaring a state of emergency in the oil and gas sector! We must be seen to do everything possible to unleash the industry.
Unlocking this incremental production is achievable only through collaboration and commitment between the industry regulators (NUPRC and NMDPRA) and industry operators (NNPCL, OPTS and IPPG) and this must be done for the sake of our country,ââ.
