Nigeria oil reserve may dry up in 50 years, says DPR
By Sulaimon Salau
Even though optimists in the energy sector have flayed the insinuations that the nation's oil reserve would dry up in the next 50 years, reports from the Department of Petroleum Resources (DPR) recently suggest that the woe may still take effect on the country if the current trend in the industry continues.
Specifically, the Director of DPR, Mr. Aliyu Sabonbirni, presenting the third quarter report of the industry in Lagos recently, said the situation of event in the industry does not prove the probability of an increase in reserve, instead, daily decrease.
He however attributed the downward trend to poor performance of the Joint Venture (JV) companies and the lingering Niger Delta crises, which had prevented most companies from full operations in the oil-rich region.
Sabonbirni, who was represented by the Head of Gas, DPR, Mr. Billy Agha, said, "current daily oil production is 2.108 million barrels of oil per day (bopd). Current oil reserves depletion rate is 2.23 per cent based on an estimated yearly production of 730.90 million barrels. Remaining reserves' life index is 45.75 years.
"Investigation conducted on reserves situation from 2002 - 2007 revealed a downward trend in the oil reserves in most of the JV companies, which accounted for 70 per cent of our nation's reserves."
However, he said PSC companies and a few indigenous operators showed aggressive exploration activities that led to some reserves growth over the reviewed period.
"As at January 1, 2008, the nation's Proven plus Probable (P+P) oil reserves was 32.93 billion barrels. Condensate (P+P) reserves was 5.19 billion barrels. Net increase of 525.67 million barrels or 1.62 per cent was recorded over January 2007 reserves," he said.
Sabonbirni noted that crude oil production for 2007 was 805.1 million barrels with an average of 2.21 million bopd. While it was noted that the current production from deep offshore is 458,542 bopd, the current average daily production as at August 2008 stood at 2.108 million bopd.
As at 2008, second half technical allowable is 2.4 million bopd as against 2.7 million bopd in first half of 2008.
On the impact of the Niger Delta crises, he said the situation has caused an average daily production deferment of 397,697 bopd showing a significant improvement from 406,493 bopd in the first quarter, noting that SPDC is making efforts to commence operations at the western location and the remaining locations in the East.
Affected companies are SPDC, Express, Elf (in western area), NAOC's Beniboye flowstation, NPDC, Dubri, SNEPCO's EA field and Cavendish. Cavendish's Obe field was shut down due to dry-docking of the FPSO.
Meanwhile, he said not less than 6,630 oil wells have been drilled in the Nigeria's onshore and offshore basins till date, while a total of 1,088.967 sq. km of seismic data was also acquired between April and September 2008.
His words, "four appraisal wells were drilled during the period under review, 75 wells were drilled and at various stages of completion between April and September 2008. Over 6,630 oil and gas wells have been drilled in Nigeria as at end of August 2008."
The department, he said has started reviewing companies' performances against their set objectives or targets, while the year 2008 work programme/budget presentation to DPR by E & P companies has been concluded.
Current deep offshore projects that are being monitored are given as; the Bonga Main, Bonga Southwest/Aparo, Bonga Northwest, Abo, Nsiko, Bosi, Erha Facilities, Usan, Agbami Aparo and Akpo.
Noting that Abo, Erha, Agbami Bonga main fields have been put to production, he said the rest are expected to come on stream between 2009 and 2012.
The DPR report also stated that about 75 rigs were in operations during the second and third quarters of 2008 as against 32 in the first quarter.