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DPR seeks PENGASSAN’s support for smooth implementation of PIA

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Mr Sarki Auwalu, Director, Department of Petroleum Resources (DPR) has called for the support of PENGASSAN towards the smooth implementation of the Petroleum Industry Act (PIA).

Auwalu made the call on Thursday at the 6th Triennial Branch Delegates Conference and Award Ceremony of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), DPR Branch.

The conference had as its theme: ‘The PIA –  Prospects for the Nigerian Oil and Gas Industry’.

Auwalu noted that the signing of the PIA after almost two decades was another landmark achievement in the oil and gas industry by President Muhammadu Buhari.

He said:” This law holds the key to unlocking value from the nation’s hydrocarbon resources for the benefit of our generation and those of our children and children’s children.

“The law will enable far reaching reforms and sustainable overhaul of the industry, as there is focussed and committed implementation framework under the distinguished leadership of the president and the Minister of State, Petroleum Resources, Chief Timipre Sylva.

“I have no doubt in my mind that this industry is set on the path for greatness.

“I, therefore, charge all of us, including the great PENGASSAN, to give unalloyed support for the smooth implementation and seamless take-off of the PIA. ”

According to him, the conference should ensure that the outcomes of the deliberations on the PIA are synthesised, collated and forwarded to appropriate quarters, including the PIA Implementation Steering Committee.

Auwalu noted that the DPR and its successor agencies – the Nigerian Upstream Regulatory Commission and the Nigerian Midstream and Downstream Regulatory Authority – would continue to play a pivotal role in the industry.

He said this included creating value and promoting industry growth,

stability and sustainability for the benefit of the country.

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DPR targets N3.2trn revenue in 2021

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The Department of Petroleum Resources (DPR) has predicted that its revenue by December 2021 would hit N3.2 trillion having achieved 70 percent of the target.
The Director of DPR) , Mr Sarki Auwalu, reported when he led a delegation of DPR management team to the Executive Secretary of Petroleum Technology Development Fund (PTDF), Mr Bello Gusau, in Abuja on Wednesday.
He said that 70 per cent of the revenue projection had already been met.
“Last year, we exceed our revenue budget. We were given N1.5 trillion but we were able to generate N2.7 trillion.
“This year, our revenue budget was N3.2 trillion. By the end of August 2021, we have generated up to 70 per cent.
“So, we with September, October, November and December, it is only the 30 per cent that we will work over,’’ he said
He noted that government took advantage of fiscal terms within the old and new legislation, thereby creating a level of increased signature bonuses.
“We reorganise the work programme that is normally being done in the DPR to key into the new operational structure as we see it in the bill, now an act.
“That programme is being handled by the planning and strategic business unit as against what we use to have, because the entire work programme is supposed to show not only technical, but also commercial and viability of oil fields and to guarantee the return on investment for investors.
“We have also created an economic value and benchmarking unit to key into the new fiscal provisions of the PIA,’’ he said.
Commenting on capacity, Auwalu said the country stands at the advantage of exporting skills to emerging oil and gas countries across Africa with proper implementation of the newly passed Petroleum Industry Act.
This, he said, the DPR was ready to partner with the Fund to continue to build capacity in the oil and gas sector
He noted that the Federal Government was determined to create leeway that would encourage investors and drastically improve the nation’s petroleum industry.
He further noted that no fewer than 300 legal battles in the oil and gas industry in Nigeria, which had been stalled for the past 20 years in courts, had been resolved through alternative dispute resolution.
According to Auwalu, the DPR is strategising well to ensure effective implementation of the PIA.
Responding, Gusau commended the DPR for enabling the industry and enhancing business activities in the oil and gas sector.
He said that DPR remained the head of the oil and gas industry in Nigeria adding that the Fund was grateful to benefit from the wealth of ideas from DPR.
“The last time we visited, we had good discussion and issues raised are being implemented like tracking the inflow of fund in signature bonus accounts.
“We extended the meeting and involved ministry of Finance, Accountant General office and even the Central Bank of Nigeria (CBN).
“Sitting at field development plans and attending significant meetings, helped us to know where and what the industry is trying to do and it also helps to inform our decisions in training and capacity plans,’’ he said
He urged the DPR to continue on its effort to ensure and efficient and productive petroleum industry in Nigeria
He assured collaboration with all as the head of the implementation committee of the Petroleum Industry Act.

DPR uncovers illegal gas plants

DPR inaugurates industry awards for improved oil recovery

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The Department of Petroleum Resources (DPR) says it will inaugurate an annual awards for companies, projects or individuals that add value to the Nigerian oil and gas industry.
A statement issued on Monday in Lagos by Mr Paul Osu, Head, Public Affairs, DPR, said Mr Sarki Auwalu, the agency Director, made the announcement on Monday during a workshop with industry partners.
The statement said the industry partners at the meeting included exploration and production companies, service companies as well as oil and gas professional bodies.
Auwalu said the Improved Oil Recovery (IOR)/Enhanced Oil Recovery (EOR) awards were part of deliberate engagements with industry partners by the regulatory agency to achieve Maximum Economic Recovery (MER) strategies for Nigeria.
He noted that the objective of the MER was to maximise the expected net value of economically recoverable petroleum from Nigeria’s acreages.
Auwalu said the Federal Government, through the MER strategies, was targeting to increase the nation’s oil reserves from 36.91 billion barrels to 50 billion barrels in the short to midterm.
He said the government was also targeting increasing Nigeria’s proven gas reserves from 206.53TCF to 250TCF.
According to him, companies, individuals, fields, research institutions and technologies are eligible for the IOR/EOR awards.
Auwalu said: “The criteria for the awards include the implementation of new technology or established technology applied in a new way and smarter work methods and processes.
“Others are willingness to take risks and outstanding researches.
“Key performance metrics are discovered recoverable resources, cost efficiency, investment value, implementation cycle, production efficiency and decommissioning cost savings.”
He said the industry initiative was one of the outcomes of the work of the National Oil and Gas Excellence Centre, Lagos, inaugurated in January by President Muhammadu Buhari.
The DPR boss noted that significant potential and value still exist in the Nigerian acreages.
“Effective implementation of the MER strategies will deliver greater value overall to all stakeholders.
“DPR will work closely with industry to deliver the MER through collaborations, communication, cooperation and coordination,” Auwalu added.

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Successful marginal field investors get award letters Monday – DPR

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The Department of Petroleum Resources (DPR) says it has concluded arrangements to issue award letters to successful investors in the 2020 marginal field bid round programme.

The DPR said the letters would be issued at an award ceremony scheduled to hold in Abuja on May 31.

Mr Paul Osu, Head, Public Affairs, DPR, made the announcement in a statement on Saturday in Lagos.

Marginal field is any field that has reserves booked and reported annually to the DPR and has remained unproduced for a period of over 10 years.

Osu said the successful investors who would be receiving their award letters were companies that had fully satisfied all requirements listed in the marginal field bid round guidelines.

He said this included full payment of signature bonuses within the specified time frame.

Osu said the DPR would continue to provide transparent regulatory oversight for the oil and gas industry to enable business and create opportunities for investors.

More than 600 companies had applied to be pre-qualified for the bid rounds which began on June 1, 2020.

The DPR said the objective was to deepen indigenous participation in the oil and gas industry as well as add to the country’s production and reserve.

According to the regulatory agency, the marginal field bid round programme is also geared to provide technical and financial partnerships for investors.

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DPR urges Africa to harness oil, gas for development

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Mr Sarki Auwalu, Director, Department of Petroleum Resources (DPR) has urged Africa to rise to the challenge of harnessing its oil and gas reserves for development of the continent.

Auwalu spoke on Wednesday at the opening ceremony of the 5th Edition of the Sub-Saharan African International Petroleum Exhibition and Conference organised by Petroleum Technology Association of Nigeria (PETAN).

The News Agency of Nigeria (NAN) reports that the three-day virtual conference has as its theme: “Post COVID-19: From Global Crises to Global Opportunities.”

He said: “Indeed, for a better and secured future, Africa must rise to the challenge of harnessing its over 125 Billion Barrels of proven oil reserves and 625 Trillion Cubic Feet of Natural gas for the development of the continent.

“Africa must not be cowed to abandon its quest to grow its economies by the ‘doomsday’ narrative of ‘end of oil’ era and jettison the development of its resources.

“Africa’s resources must be used to fuel Africa’s development; the same

way other continents utilised dirtier fossil fuels to fuel their economic transformation.

“To achieve this, we must take our destinies in our hands and join hands across all spectrum – technical, economic, legal, commercial, operational, financial, and political – drive regional energy security and economic sustainability. ”

According to him, Nigeria recognises the reality of energy transition and is committed to accelerated development of its petroleum resources through the emplacement of appropriate legal framework to support upstream asset acquisition, development, production, and exports.

“However, we are putting increased emphasis on midstream investments and gas-focused infrastructural development for domestic value addition via the Refinery revolution and Decade-of-Gas Initiatives.

“The Decade-of-Gas Initiative will leverage Nigeria’s 203 TCF of natural gas reserves for domestic gas supply (Gas-To-Power), Alternative fuels (Gas-To-People) and Gas Based Industrialisation (Gas-To-Derivatives) elements of the Gas-fired Industrial economy agenda within this decade.

“All these efforts will significantly increase the quantum of in-country value addition to drive the contribution oil and gas to Gross Domestic Production, employment generation and poverty eradication,” he said.

Also, Mr Simbi Wabote, Executive Secretary, Nigerian Content Development and Monitoring Board (NCDMB), said the coronavirus pandemic provided a sad realisation of the importance of local content in the oil and gas industry.

Wabote said the NCDMB would continue to deploy strategies to promote local content in Nigeria and within the African continent to provide jobs, support businesses and protect investments.

Earlier, Mr Nicolas Odinuwe, Chairman, PETAN, said the aim of the conference was to offer direct access to the primary stakeholders and key players across the entire Sub-Saharan African supply and value chain.

Odinuwe stressed the need for continued collaboration among African countries to foster development of the continent through the utilisation of its oil and gas resources.

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DPR resolves first case in its alternative dispute resolution centre

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Loveth Okoli

The Oil and Gas Alternative Dispute Resolution Centre (ADRC) has resolved its first case in line with the objective of the Federal Government for speedy resolution of disputes in the industry.

Mr Paul Osu, Head, Public Affairs, Department of Petroleum Resources (DPR), made the announcement in a statement issued in Lagos.

Osu said four other cases were currently at hearing stage before the ADRC, one of the units of the National Oil and Gas Excellence Centre, inaugurated by President Muhammadu Buhari.

He said:  “The ADRC has a six-member Advisory Council and a 20-member Body of Neutrals mediating on disputes between players in the oil and gas value chain.”

Osu said the setting up of the ADRC was in consonance with the provisions of the Petroleum Act Cap P10 Laws of the Federation 2004.

He noted that the law emphasised the need for settlement of disputes through alternative dispute resolution mechanisms without recourse to litigation.

“The ADRC has successfully resolved its first case and we have four others pending.

“This is a positive step for the industry because the objective of setting up the centre is to reduce cost, enhance safety and add value to the sector.

“With this, we can begin to win investors’ confidence thereby attracting more investments to the oil and gas sector,” Osu said.

He explained that participating or referring of cases to the ADRC was voluntary, adding that it would be very beneficial to the parties.

Recall that the Advisory Council is made up of the Director of the DPR, Mr Sarki Auwalu (Chairman), Justice Saliu Said, Justice Cecelia Olatoregun, Chief Bayo Ojo (SAN), Mr Daere Akobo and Mr Nicholas Odinuwe.

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DPR says Nigeria has accurate record of crude production

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Tanko Mohammed

The Department of Petroleum Resources (DPR) has debunked claims that the exact volume of crude oil produced in the country was not known.

Mr Paul Osu, Head, Public Affairs, DPR, in a statement issued in Lagos, said every litre of crude produced in the country was adequately captured during the process of extraction.

Osu said it was the responsibility of the DPR to monitor and account for crude oil production as basis for determining government’s revenue through royalty payments by operators for sustainable development.

He said: “As a further step to boosting crude accounting process from production to export, DPR recently launched the National Production Monitoring System (NPMS).

“NPMS is an online platform for direct and independent acquisition of production data from oil and gas facilities in Nigeria.

“NPMS as an electronic data transmission tool at production and export terminals is designed to better predict the performance of oil and gas reservoirs and better production forecasting.”

According to him, the NPMS tool enables DPR to exercise surveillance, perform production monitoring and data analysis for utilisation and forecasting.

Osu said DPR as a business enabler and opportunity house would continue to develop robust and strategic initiatives to ensure timely and accurate payment of rents, royalties and other revenues due to the government.

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DPR identifies key areas of operational excellence for oil, gas

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Loveth Okoli

The Department of Petroleum Resources (DPR) has identified six key areas of operational excellence for Nigeria’s oil and gas industry, urging  stakeholders to build a culture in these specific areas.

Mr Sarki Auwalu, Director, DPR, disclosed this on Thursday, during his keynote address at the 2021 Oloibiri Lecture Series and Energy Forum (OLEF).

The event was organised by the Society of Petroleum Engineers (SPE) Nigeria Council.

Auwalu listed the key areas as health, safety and environment; cost performance and return on capital for all stakeholders across all assets, as well as use of appropriate and consistent standards across the entire business.

According to him, “it also includes continuous improvement culture that strives to exceed set targets; human capital development and improved reputation, based on efficient operations and sustainable business practices.

“DPR will regularly review the industry performance on operational excellence based on the above measures and provide appropriate feedback to respective companies and the industry in general,’’ the director said.

He stressed that the DPR would only use regulations as tools to allow the industry to develop and operate their assets safely, reliably, sustainably and cost effectively.

He noted that this year’s event with the theme: `Operational Excellence and Portfolio Optimisation, Way Forward for the Oil & Gas Industry Post COVID- 19’;  was apt in view of current global realities.

Auwalu explained that the DPR, under the leadership of the Minister of State for Petroleum Resources, Chief Timipre Sylva, had rolled out four strategic focuses, to reposition the industry due the challenges caused by the pandemic.

“These measures were to ensure that the Nigerian oil and gas industry survive and thrive in the face of severe economic disruptions and daunting challenges.

“The department has continued to monitor industry metrics and we are optimistic that the industry is emerging stronger with key indicators pointing northwards,” he said.

Auwalu said the DPR under his leadership was a business enabler and opportunity provider and would continue to incentivise operational excellence, rather than focusing on sanctions.

He urged stakeholders in the industry to leverage on the recently inaugurated National Oil and Gas Excellence Centre (NOGEC) to drive safety, value and cost efficiency in the industry.

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DPR seals 86 illegal gas plants

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DPR seals 86 illegal gas plants

Loveth Okoli

The Department of Petroleum Resources (DPR) has shutdown 86 Liquefied Petroleum Gas (LPG) plants in Lagos State in 2020 that are operating illegally.

Mr Paul Osu, Head, Public Affairs, DPR made this known in a statement issued on Wednesday in Lagos.

Osu said LPG ( cooking gas ) plants were shut down for non-compliance with international safety standards.

According to him, the plants were also operating without prerequisite approval or licence from the regulatory agency.

Osu said some of the sealed plants were operating under high tension electrical installations and other unapproved locations.

He noted that the move was aimed at reducing the occurrence of gas explosion and fire incidents in Lagos State.

Osu said the DPR would continue to clamp down on such illegal plants while at the same time sensitising the public on the need for safe usage and distribution of gas.

The Department of Petroleum Resources (DPR) has shutdown 86 Liquefied Petroleum Gas (LPG) plants in Lagos State in 2020 that are operating illegally.

Mr Paul Osu, Head, Public Affairs, DPR made this known in a statement issued on Wednesday in Lagos.

Osu said LPG ( cooking gas ) plants were shut down for non-compliance with international safety standards.

According to him, the plants were also operating without prerequisite approval or licence from the regulatory agency.

Osu said some of the sealed plants were operating under high tension electrical installations and other unapproved locations.

He noted that the move was aimed at reducing the occurrence of gas explosion and fire incidents in Lagos State.

Osu said the DPR would continue to clamp down on such illegal plants while at the same time sensitising the public on the need for safe usage and distribution of gas.

Nigeria to facilitate major gas pipeline

DPR reviews terms for gas development

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Tanko Mohammed

The Department of Petroleum Resources (DPR) has reviewed five terms for gas development under the Production Sharing Contracts (PSC) in Nigeria.

Mr Sarki Auwalu, the Chief Executive Officer, said this during a Public hearing at the National Assembly organised by the Joint Committee on Gas Resources and Petroleum Resources, Upstream and Downstream, in Abuja, on Monday.

The hearing was on the Topic: “Inclusion of Gas Terms in Production Sharing Contracts  by the Nigerian National Petroleum Corporation (NNPC).”

He said DPR had considered and reviewed five terms for gas development in PSC and the terms included duration, cost of gas, tax gas, royalty and profit gas.

“These five terms, we believe when considered, will definitely make it robust and enable the provisions that made in the Petroleum Industry Bill (PIB) to adequately address all issues and concerns,” said Auwalu.

He explained that the first PSC as a business arrangement was signed in 1973 between the government and international oil companies with the absence of gas terms in the contract.

According to him, others were signed in 1993 with oil majors and 1998 with main indigenous companies, while 2005 and 2007 served contracting documents between NNPC and their contractors.

He noted that under the existing PSC and gas terms, Oil mining Lease (OML) 42 and 36 were awarded on PSC, in addition to OML 127 and 130 that were on Sub lease.

“The new regime of the PSC was introduced by the deep offshore by the inland basin connection Sharing Contracts of 2004 and was amended  in 2019 to replace the royalty regime of  1999 act,” he said.

On utilisation of PSC funds, he noted that so far gas from OML 18O and 130 operated by shell and Total were being utilised via Nigerian Liquified Natural Gas (NLNG).

These, he said were also strategies used in the industry to enhance gas penetration and utilisation in Nigeria.

Auwalu added that the gas price mechanism template would be presented to the Minister of State for Petroleum Resources, Chief Timipre Sylva, on March 9th.

He said the government was also making effort to ensure full penetration of gas in the country.

“We are making efforts to have more infrastructure to make gas available in Nigeria as well as creating the enabling environment for investors and private owners, especially for PSC,” Auwalu said.

On appropriate gas pricing, he said the DPR and NNPC would ensure that a good price mechanism would be put together to enable gas exploration, production and utilisation across the nation.

He said the effort being championed by the National Assembly would  definitely lead to energy security.

“The minister declared this decade, the decade of gas and this proposal by us and our submission to the joint committee will give a base line for intended work that the NASS is doing for energy security for the country.

“It is our understanding that the PIB will be passed, this is the time to address a lot of issues, and this submission could be among the best inputs to that document that we are anxiously waiting to be passed,” he added.

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