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North’s N600bn oil search suffers setback



North’s N600bn oil search suffers setback

The Nigerian National Petroleum Cor porat i o n (NNPC) has deferred the return of equipment and personnel to exploration site in the Lake Chad earlier planned for this week. This is a major setback to the oil search in the North on which over N600 billion ($2 billion) had been invested.

New Telegraph learnt yesterday that the promise made by the Group Managing Director of the corporation, Dr. Maikanti Baru, on May 15 to return to site in “six weeks” might not come to fruition due to inability to move the equipment last week, which is the third week, based on the failure to secure clearance from the military just two weeks to the time promised.

Baru had, four weeks ago, announced the plan to resume exploration on the Lake Chad, earlier suspended during the heat of Boko Haram insurgency, in the next two weeks. Speaking when he paid a courtesy visit to the Governor of Borno State, Kashim Shettima, and the Shehu of Borno, Alhaji Abubakar el- Kanemi, in Maiduguri, the NNPC’s helmsman, who promised his corporation’s determination to return to site “in six weeks,” stated that this decision would majorly be made after a “green light” to go ahead from the military authorities.

T he security clearance was, according to Baru, necessary despite improved security situation in the North-East. The NNPC, a top management staff of the corporation told this newspaper after his anonymity had been guaranteed, had deferred the deadline earlier given to resume exploration at the Lake Chad on June 19.

He said: “Major equipment and personnel needed for this operation are, as we speak, have not been mobilised to site for simple reason of inability to secure clearance, on time, from the military authority. “The second phase of the problem is that the personnel are demanding for proof of the clearance, particularly from the military, that is it safe to go back to site? “This attitude is not abnormal, it is a general practice in the oil and gas industry; safety is a global standard that is being adhered to in equal measure throughout the world oil and gas industry.

“The corporation needs the clearance to have come last week, which is the third week after the promise. This is not politics; it is the logistic requirement because of the equipment and personnel that are needed to be moved on site.” But the Group General Manager, Group Public Affairs Division of the NNPC, Ndu Ughamadu, insisted that the Corporation’s men were “already on ground in Maiduguri as we speak.” He, however, kept mute on whether the corporation has secured the “green light” from the military or not.

“It is true that the GMD, represented by Engr. Muhammed, made the promise on May 15, but it is too early to know what would be done. As we speak, our men are on ground in Maiduguri and we are optimistic that the set target would be met,” he added.

When told that this newspaper’s source within the corporation stated that the NNPC was yet to be given a clearance to mobilise staff and equipment to site, he said: “All I can say is that the military are cooperating with NNPC on this and we believe that we still have time to achieve what we set out to achieve with full cooperation of the military.

It is too early to say that we will not go ahead.” The industry had invested approximately $1.3 billion up to the end of 1998, while over $700 million has been invested afterward, according to this newspaper’s investigation. The NNPC, it would be recalled, stated that it was awaiting clearance from security agencies to resume oil exploration in the Chad Basin.

The security clearance was, according to Baru, necessary despite improved security situation in the North-East. He stated: “We have been discussing with military authorities in the area and they have assured us of improved security.

Once they give us the green light, we would resume operations in the area within six weeks,” the GMD, who was represented by the Chief Operating Officer, Gas and Power, Saidu Mohammed, had said. The GMD commended the efforts of President Muhammadu Buhari as well as the state governor in the area of peace restoration, reconstruction and rehabilitation, stressing that as a responsible corporate citizen, the Corporation was ready to provide support in that regard.

Before an order was given by President Muhammadu Buhari, the prospects of oil in the North were still mere potential and remained in the realm of possibilities, despite the huge investments made. Aside from the $1.3 billion invested before 1998, additional investments of about N27 billion and $340 million had also been invested for seismic data acquisition and equipment for advanced search respectively.

A recent document prepared by the NNPC, dated October 7, 2016 and marked “update” on the oil exploration activities in the Lake Chad Basin, also revealed that 33,550 sq km of 3-D seismic data would soon be acquired for processing, in an effort to get a clearer picture of oil reserves in the area.

“The drills and finds are from the oil bloc 809, which is being held by the Nigerian National Development Company (NNDC), a subsidiary of NNPC, vested with the duties of exploration and investment,” the document sighted by this newspaper read. It stated: “Though it is too early to be categorical, there is a possibility that we may find oil in commercial quantity in the Chad Basin because of deposits in neighbouring countries of Chad, Niger and Sudan, which have similar structural settings with the Chad Basin. Therefore, it is prudent to aggressively explore the Chad Basin for possible deposits.”

The discoveries made in neighbouring countries in basins with similar geological/ structural settings such as Dabo, Daseo and Bongar in Chad, the document added, amount to a reserve of over two billion barrels reserve. “Other areas are Longone, Birni in Southern Chad and Northern Cameroun where over one billion barrels holding reserve exists; and Termit-Agadam Basin in Niger Republic which also holds a reserve of over one billion barrels. “Already, the NNPC New Frontier Exploration Services Division, which is leading the charge for crude oil finds in the entire Inland Basins is acquiring 3,550 sq km of 3-D seismic data for processing and interpretation in addition to the already acquired 6,000 km of 2-D data that is currently being processed,” the report said.

The document further said: “Currently over 600,000 seismic section and 30,000 wells log are being scanned in good time for the eventual drilling”. The report pointed out that before now, “23 wells have been drilled with two of the wells, Wadi-1 and Kinsar, encountering noncommercial gas.”

It revealed that the search is not limited to Chad Basin alone, but covers other parts of the country. “The search is not limited to the Chad Basin alone, but covers extensive inquest in the entire Nigerian Frontier Sedimentary; Anambra, Bida, Dahomey, Gongola/Yola and the Sokoto Basins alongside the Middle/ Lower Benue Trough”, the document added.

The University of Maiduguri, it would be recalled, was awarded the contract to conduct the environmental baseline studies/ impact assessment for the Chad Basin project “as part of its Corporate Social Responsibility to the host community and because of its proximity to the operational area.”

Further checks showed that a British firm was appointed by the 19 Northern governors through the Northern Nigeria Development Corporation (NNDC) to also carry out exploration activities for oil and gas in Lake Chad region and Benue Trough so as to fast-track the process and diminish the accusation by the oil-rich Delta region that the North has nothing to contribute to the nation’s economy.

Chairman of NNDC, Mallam Bashir Dalhatu, was quoted to have said in Katsina State after a meeting with the governors: “We have engaged a British company that is already working in the Lake Chad region and from Niger and Chad side in the same area with us and we have been meeting with NNPC in order to put efforts together.”

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