Despite several industry challenges, including crude oil theft and pipeline vandalism, Nigeria has continued to dominate as Africa’s largest producer of crude oil, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has said.
Addressing members of the House of Representatives Special Committee during a two-day Public Investigative Hearing on Crude Oil Theft/Losses on Thursday in Abuja, the Commission Chief Executive, Gbenga Komolafe, said the country’s proven crude oil reserves currently at about 37.50 billion barrels, oil production has been sustained at approximately 2.19 million barrels per day (mbpd).
As of July 23, 2024, the CCE said Nigeria’s average daily oil production stood at an average of 1.61 mbpd.
Under the provisions of the Petroleum Industry Act (2021), the CCE said the Commission was granted several statutory mandates in the areas of calibration and certification of metering systems and equipment, publication of reports and statistics on Upstream operations, regulatory oversight and issuance of quality and quantity certificates for exports, and determination of fiscal prices for crude oil and condensate.
Apart from its statutory mandates, he said the Commission, which regulates both the technical and commercial aspects of operations in the nation’s upstream petroleum sector, has developed some regulatory strategies to oversee the exploration, development, production, and lifting operations of crude oil and natural gas.
Other areas of major focus for the Commission, he said, include ensuring business continuity and production sustainability at low costs, accurate measurement and timely payment of royalties, uninterrupted crude oil and natural gas supply to the domestic market, and maintaining safety, health, and environmental standards.
He said the ultimate objective of the Commission’s operations was to ensure optimal tax revenue generation, royalty collection, and cost benchmarking.
As the nation’s upstream chief regulator, he said the Commission’s strategies were aimed at optimizing production, enhancing regulatory oversight, and ensuring accurate measurement and accounting.
Highlighting the key initiatives of the Commission, Engr. Komolafe said the Commission has continued to prioritize the improvement of rig availability and reduction of non-productive time through unlocking heavy crude oil reserves via industry workshops.
These initiatives, he pointed out, also support new Petroleum Prospecting License (PPL) awardees to achieve first oil, among other initiatives.
The CCE told the lawmakers that the country was facing significant challenges in the areas of crude oil theft and pipeline vandalism, especially as they affect oil terminals at Bonny, Brass, and Forcados.
This, he said, prompted the Commission to employ end-to-end production monitoring and a mass balance methodology to accurately account for losses and differentiate them from operational losses.
These interventions, he disclosed, have significantly reduced crude oil theft, with zero incidents reported in July 2023.
On transparency and accountability, Komolafe said the NUPRC introduced several innovative measures to enhance transparency and accountability in its operations.
He listed these innovations to include the Advanced Cargo Declaration (ACD) Regulation that ensures no crude oil was exported without proper accounting and assignment of a unique identification number (UIN) to each cargo; the Upstream Metering Regulation, which mandates reliable metering systems to account for all hydrocarbon production and exports, and real-time cargo tracking and digital documentation to improve visibility and efficiency in cargo operations.
He reaffirmed the NUPRC’s commitment to continue engagement with stakeholders to optimize Nigeria’s Oil production and maintain its leadership position in Africa’s energy sector.
