The Nigerian National Petroleum Company Limited (NNPCL) has set ambitious goals for 2023, aiming to produce two million barrels of crude oil per day and reduce the impact of oil theft and pipeline vandalism in the Niger Delta.
The newly inaugurated board of the NNPCL, which oversees the state-owned oil and gas company, said it was committed to improving the governance, profitability, and social responsibility of the sector.
President Bola Tinubu, who appointed the board members on Monday, urged them to work hard and deliver results, warning that non-performance and entitlement would not be tolerated.
He also said the board must prioritize the welfare of the Niger Delta people, who have suffered from the environmental degradation caused by oil exploration and exploitation.
Transition to Cleaner Energy
According to a report by Punch, the president also directed the board to pay more attention to gas, as Nigeria moves towards a sustainable and green energy future.
“We need to show that we are committed to the welfare of our country,” he said.
However, the country has not been able to fully harness its gas potential, due to inadequate infrastructure, pricing issues, and regulatory uncertainties.
The NNPCL said it would invest in gas development projects, such as the Ajaokuta-Kaduna-Kano pipeline, the Nigeria LNG Train 7, and the Brass Fertilizer and Petrochemical Company.
The act aims to reform the oil and gas sector, by creating a clear and transparent regulatory framework, enhancing accountability and environmental standards, and ensuring a fair distribution of oil revenues.
Security and Production Challenges
The NNPCL board, however, faces significant challenges in achieving its targets, especially in the area of security.
Nigeria’s oil industry has been plagued by frequent attacks on pipelines and facilities, by militants, criminals and local communities, who demand a greater share of the oil wealth.
According to the Senate, Nigeria lost at least $2 billion to oil theft in 2022, and only 66% of the country’s oil production could be effectively guaranteed.
The NNPCL board chairman, Pius Akinyelure, said the board would work with the government and other stakeholders to address the security situation and minimize the losses.
He also said the board would collaborate with the International Oil Companies, the National Oil Spill Detection and Response Agency, and the communities to prevent and mitigate the environmental impacts of oil spills.
The board also faces the challenge of increasing Nigeria’s oil production, which has been constrained by the quota imposed by the Organization of Petroleum Exporting Countries (OPEC), as part of the global effort to stabilize the oil market.
Nigeria’s current production is about 1.67 million barrels per day, below its OPEC quota of 1.8 million barrels per day.
A Hopeful Outlook
Despite the challenges, the NNPCL board expressed optimism that the oil industry would remain a vital and viable sector for Nigeria’s economy and development.
The board said it would leverage the opportunities presented by the global energy transition, the digital transformation, and the local content policy, to create value and innovation for the country.
The only female member of the board, Dr. Eunice Thomas, said she was honored and challenged by the president’s appointment, and that she would bring her expertise and experience to the board.
The NNPCL board members include Umar Ajiya as Chief Financial Officer, Ledum Mitee, Musa Tumsa, and Ghali Muhammad as Non-Executive Directors.
Other Non-Executive Directors are Prof. Mustapha Aliyu, David Ogbodo, and Eunice Thomas.
