Report of British Petroleum (BP) Statistical Review 2021 says Nigeria’s crude oil reserves declined by about 600 million barrels between 2017 and 2020.
The decline it says hinged on the back of reducing investments in the last few years.
It says that a three year period, Nigeria’s reserves did not grow, but rather fell from 37.5 billion barrels to 36.9 billion barrels in 2020.
But to resolve the issue, the new Petroleum Industry Act (PIA) has earmarked 30 per cent of profit oil and profit gas from the Nigerian National Petroleum Corporation (NNPC) exploration services, in a bid to beef up the country’s reserves.
With deteriorating facilities Nigeria was in July and August unable to meet the quota allocated to it by the Organisation of Petroleum Exporting Countries (OPEC).
A report by Mordor, a market intelligence and consulting services firm, said that the COVID-19 pandemic had significantly hampered the growth of the market in Nigeria, mainly due to global oil and gas demand contraction and global economic slowdown.
“The outbreak of COVID-19 led to the crude oil price crash of April 2020, leading to a significant reduction in Capital Expenditure (CAPEX) spending by oil and gas companies globally.
“The country’s national oil and gas companies were already struggling with liquidity and cash shortage, and due to the outbreak of COVID-19, the situation has further deteriorated, “Mordor said.
“However, some of the major factors driving the market include increasing investments in the upstream sector and the development of large-scale and modular refineries in the country.
“Oil and gas production had been hampered in Nigeria in the past few years due to the attack on oil and gas infrastructure by militants. Furthermore, oil theft has been one of the major issues faced by the oil and gas market in Nigeria, which resulted in huge losses to operating companies in the country.
“Such factors are expected to have a negative impact on the market growth during the forecast period,” it said in the report tagged “Nigeria Oil and Gas Market: Growth, Trends, COVID-19 Impact and Forecasts,” covering between 2021-2026.
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Nigeria’s crude oil reserves dip by 600m barrels
