Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, has said reforms introduced by the administration of President Bola Tinubu have increased Nigeria’s crude oil production by more than 80 per cent.

Lokpobiri stated this in Yenagoa, Bayelsa State, at a breakfast meeting with media friends led by Elder Asu Beks.

The meeting was themed, “Counting the Gains of the Oil Sector Reforms Under President Bola Tinubu.”

The minister said Nigeria was producing less than one million barrels per day of crude oil and condensate when the Tinubu administration assumed office in 2023.

He said production had since risen to 1.824 million barrels per day, including condensate, citing the latest weekly report of the Nigerian Upstream Regulatory Commission (NUPRC).

“Condensate is not counted by OPEC. As of the last weekly report from NUPRC, we are producing 1,824,000 barrels per day inclusive of condensate. That is over 80 per cent from where we started in 2023,” he said.

According to Lokpobiri, the increase was achieved through the concerted efforts of stakeholders in the oil and gas industry, under the leadership of the President.

He said Nigeria previously had fewer than 10 active drilling rigs and had recorded no seismic activity for more than two decades.

The minister said the number of active drilling rigs had now risen to more than 70, noting that drilling a well costs between $25 million and $30 million onshore and between $80 million and $100 million offshore.

He also claimed that Nigeria, which he said recorded virtually no oil and gas investment for more than a decade before the Tinubu administration, now accounts for about 60 per cent of oil and gas investments coming into Africa.

Lokpobiri attributed the development partly to the Federal Government’s approval of the divestments by Shell to Renaissance and ExxonMobil to Seplat.

He said the approvals had unlocked investments in projects including the Bonga North, Bonga South-West and Zabazaba fields.

The minister also said indigenous oil companies now accounted for about 60 per cent of Nigeria’s crude oil production, compared with the period when international oil companies produced about 90 per cent.

Subsidy removal

On the removal of petrol subsidy, Lokpobiri described the policy as inevitable, saying the Federal Government had previously spent about N18.4 billion daily on subsidy when the exchange rate was N448 to the dollar.

He said the expenditure amounted to about $15 billion annually, or approximately N21 trillion when calculated at an exchange rate of N1,400 to the dollar.

The minister said the removal of the subsidy had also strengthened the revenue available for distribution to the three tiers of government through the Federation Account Allocation Committee (FAAC).

According to him, monthly FAAC allocations have increased from less than N600 billion to more than N2 trillion.

He said the increase had enabled 27 states that previously struggled to pay salaries to meet their obligations and execute development projects.

Lokpobiri said the Nigerian National Petroleum Company Limited (NNPCL), which he claimed previously did not declare profits or meet cash-call obligations, now declares profits, contributes to the Federation Account and meets its financial obligations.

He said Section 205 of the Petroleum Industry Act, signed into law by former President Muhammadu Buhari, provides for market-based pricing.

The minister added that deregulation had enabled the Dangote Refinery to supply aviation fuel to European markets.

According to him, Nigeria had previously been subsidising petrol consumption across parts of West and Central Africa before the subsidy was removed.

Atala oil field

Speaking on the disputed Atala oil field in Bayelsa State, Lokpobiri said the state government had challenged the matter in court but lost at both the Federal High Court and Court of Appeal.

He said efforts were now being made to explore a political solution that would facilitate funding for the development of the field.

On OML 240, which he said belonged to Bayelsa State, the minister said the oil block was awarded more than two decades ago and had since expired.

He added that a Norwegian company had been brought in to develop the asset. (Vanguard)

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