The Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kyari, has said the era of waste and lack of transparency in the oil industry is over.

He said the country could not afford to sustain such a regime, especially on the back of the devastating impact of the COVID-19 pandemic on the sector’s operations.

A statement by the Group General Manager, Group Public Affairs Division of the NNPC, Dr. Kennie Obateru, stated that Kyari spoke during a virtual presentation at the opening ceremony of the 38th Annual International Conference and Exhibition of the Nigerian Association of Petroleum Explorationists (NAPE) held in Lagos.

According to him, it is no longer sustainable to continue to do business in an environment of high operational costs as the current market reality does not support it.

He said: “It is instructive to understand that the current market reality cannot support inefficiency and escalated costs of operations. The era of $30/bbl oil no longer exists.

In today’s COVID-19 defined market, sustaining operations and making progress means that all stakeholders must recognise the need to improve efficiency, reduce costs, eliminate wastages and entrench accountability.

They must act with transparency and embrace technology and innovation to drive performance and value realisation across strategic investment portfolios.

Kyari added that the NNPC has made progress in improving operational efficiency through the adoption of technology and deliberate effort to curtail the soaring cost of operations across strategic assets.

He explained that in the face of the energy transition, the corporation is focused on developing gas infrastructure and deepening domestic gas utilisation as gas remains the energy of the future.

He reiterated NNPC’s resolve to grow the nation’s hydrocarbon reserves to 40 billion barrels through reinvigorated exploratory activities in the inland frontier basins across the country, stating that crude oil has already been discovered in the Benue Trough in commercial quantity, with Nigerian geologists spearheading the efforts.

Kyari noted that the strategy is to explore for more oil in the frontier basins in order to grow the nation’s reserve base, in line with the federal government’s aspiration to hit the 40 billion barrels reserves target.

He said the theme of this year’s conference:

Accelerating Growth in Nigeria’s Hydrocarbon Reserves: Emerging Concepts, Challenges and Opportunities,

fits into NNPC’s key aspiration, which is to grow the nation’s hydrocarbon reserves, reduce unit operating cost of crude oil production to $10 per barrel and improve efficiency across its businesses.

It is my pleasure to appreciate the good work and resilience of our in-house professionals in the ongoing inland basins exploration activities that culminated in the recent discovery of hydrocarbons in Benue Trough. NNPC is indeed proud that it is NAPE members that are spearheading this effort,

Kyari stated.

He expressed optimism that the Petroleum Industry Bill (PIB) will be passed next year, noting that the fiscal environment proposed will attract more investment into the oil and gas industry.

He assured NAPE and all other industry operators of sustained collaboration from NNPC, saying that the strategy of synergy is required to drive down operating cost and survive the emerging challenges in the industry.

Justin Nwosu

Justin Nwosu is the founder and publisher of Flavision. His core interest is in writing unbiased news about Nigeria in particular and Africa in general. He’s a strong adherent of investigative journalism, with a bent on exposing corruption, abuse of power and societal ills.