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NNPC declares state of emergency on crude oil production – Premium Times

By Mary Izuaka

The Nigerian National Petroleum Company Limited (NNPC Ltd) on Tuesday declared a state of emergency on Nigeria’s crude oil production.

The Group Chief Executive Officer of NNPC Ltd, Mele Kyari, made the declaration while speaking at the ongoing 2024 Nigeria Oil and Gas (NOG) Energy Week in Abuja on Tuesday.

Mr Kyari said the move is directed towards increasing Nigeria’s crude oil production and growing its reserves.

“We have decided to stop the debate. We have declared war on the challenges affecting our crude oil production. War means war. We have the right tools. We know what to fight. We know what we have to do at the level of assets. We have engaged our partners. And we will work together to improve the situation,” Mr Kyari said.

He explained that a detailed analysis of assets revealed that Nigeria can conveniently produce two million barrels of crude oil per day without deploying new rigs, but the major impediment to achieving that remains the inability of players to act in a timely manner.

“War will help NNPC Ltd and its partners to speedily clear all identified obstacles to effective and efficient production such as delays in procurement processes, which have become a challenge in the industry,” he added.

On medium to long-term measures aimed at boosting and sustaining production, Mr Kyari said the NNPC Ltd would replace all the old crude oil pipelines built over four decades ago and also introduce a rig-sharing programme with its partners to ensure that production rigs stay in the country for between four and five years which is the standard practice in most climes.

He, however, called on all players in the industry to collaborate towards reducing the cost of production and boosting production to target levels.

Mr Kyari expressed the company’s commitment to investing in critical midstream gas infrastructure such as the Obiafu-Obrikom-Oben (OB3) and the Ajaokuta-Kaduna-Kano gas pipelines to boost domestic gas production and supply for power generation, industrial development and economic prosperity of the country.

In his address, Haitham Al Ghais, the secretary-general of the Organisation of Petroleum Exporting Countries (OPEC), said the global energy demand will rise by an estimated 23 per cent by 2045.

“We see energy demand rising by an estimated 23 per cent by 2045. This will be fueled by a world economy that is expected to double in size, growing from $138 trillion last year to $270 trillion in 2045.

“We also forecast a rapidly expanding world population that will surpass 9.5 billion people, with most growth seen in non-OECD developing countries. Urbanisation alone will account for over half a billion people moving to cities around the world by 2030. This data tells us that the world will require all forms of energy to meet long-term energy needs,” he said.

He explained that oil and gas will remain the predominant fuels in the energy mix.

He said oil alone will retain its share at almost 30 per cent in 2045 as world demand for oil soars to an estimated 116 million barrels per day (bpd) by that time.

To meet this rapid and robust growth in energy consumption, he said, the industry needs to boost investment levels significantly in the years to come.

“According to our research, cumulative oil-related investment requirements from now until 2045 will amount to approximately $14 trillion or around $610 billion on average per year. Securing this vital funding is essential to maintaining security of supply and avoiding unwanted volatility,” he added.

Indeed, he said, the rush to adopt “Net-Zero” strategies was misguided and simply not realistic.

“Developing countries continue to balance priorities between developing their national economies and addressing climate change. In this regard, OPEC and its Member Countries continue to advocate for a balanced and fair process for adaptation, mitigation and the means of implementation, particularly with regard to climate finance and technology.

“This is crucial for Africa, to ensure its unique circumstances are respected and taken into consideration. And, finally, we must not relent in our efforts to tackle the issue of energy poverty. It is an unfortunate fact that still today, there are an estimated 675 million people with no access to basic forms of energy and 2.3 billion without access to clean cooking fuels.

“World leaders must unite and advocate for the necessary support and resources to make a difference in addressing this important matter,” he said.

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