Gas Reserves Rise by 2.09tcf to 208.62tcf

Emmanuel Addeh in Abuja

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has disclosed that Nigeria’s total gas reserves increased by 2.09 trillion cubic feet (TCF) while the country’s gas stock expanded by 136 million barrels as of January 2022.

NUPRC, the country’s oil and gas regulator, said the gas reserves grew from 206.53 TCF to 208.62 tcf, climbing 1.01 per cent while crude recorded a marginal increase of 0.37 per cent.

The Chief Executive of NUPRC, Mr Gbenga Komolafe made this disclosure during a news conference to assess his first six months in office, saying since January 1, the nation’s oil reserves moved from 36.910 billion barrels to 37.046 billion barrels.

Komolafe stated that the new figures were arrived at after the operators in the sector submitted their annual reports of reserves to the commission.

He disclosed that a total of 61 operating companies submitted the document in 2021 in line with the provisions of the Petroleum Industry Act (PIA) 2021.

“Analysis of the report indicates that the nation’s oil and condensate reserves status as at 1st January 2022 was 37.046 billion barrels representing a slight increase of 0.37 per cent compared to 36.910 billion barrels as at 1st January 2021.

“On the other hand, the national gas reserves status as of 1st January 2022 was 208.62 TCF, representing an increase of 1.01 per cent compared to 206.53 TCF as at 1st January 2021.”

On initiatives to enhance crude oil production, Komolafe said the commission “has initiated a massive campaign dedicated to the identification of oil and gas wells producing below capacity.

“This was being done by the inventorisation of shut-in wells and analysis of the inventory to map the reasons for shut-in and devise measures for quick reopening.

He said the regulatory body was using well and reservoir surveillance activities in identifying poorly performing wells and workover candidates for quick intervention.

He pointed out that the commission was embracing and adopting new technologies and advanced recovery techniques for unlocking some identified stranded oil and gas resources.

On gas, Komolafe said the conflict between Russia and Ukraine and the attendant disruptions to the global gas demand-supply chain had provided Nigeria with a unique opportunity to fill the gap through the implementation of several natural gas developmental initiatives.

He declared that the NUPRC would enhance gas exploration, development and utilisation schemes, which will lead to growth, increased gas production, maturation of domestic and export gas market, as well as gas flare elimination.

“The commission is currently engaging all lessees on their natural gas flare elimination and monetisation plan to ensure compliance with Section 108 of the PIA and boost supply to the rapidly growing gas market.

“Furthermore, in the face of the global energy transition and the need for cleaner sources of energy, gas is being positioned as our immediate transition fuel to lower the nation’s carbon emission footprint in line with our climate change commitment.

“Additionally, we are encouraging investors to leverage on the generous gas fiscal incentives in the PIA such as zero hydrocarbon tax, reduced royalty rates, tax consolidation provisions amongst others to take Final Investment Decisions (FIDs) on their proposed upstream projects,” Komolafe stressed.

He noted that with the proven gas reserves base of 208.62TCF, the country was on track to increasing its reserves volumes to 220TCF in less than 10 years and 250TCF thereafter.

He said Nigeria currently produces about 8BSCF/D of gas, out of which about 20 per cent is delivered to the domestic market while approximately 40 per cent is exported to international markets.

Moreover, he disclosed that 30 per cent is currently being utilised for producers’ internal consumption and the excess gas is flared.

According to him, other measures to ramp up gas production include the commencement of mandatory conduct of gas well deliverability tests for all gas producers to establish operating limits.

Komolafe said that this would enable the commission to determine production potential and guide the industry towards its maximum optimum capacity.

He listed other initiatives as the constant engagement with operators on the need to drill below the conventional oil window in a bid to target gas-rich zones for production.

“This will increase the nation’s gas reserves as well as steer operators with saturated reservoirs,” the chief executive of the commission explained during the briefing.

Komolafe stated that the commission was currently revising the flare gas regulations of 2018 and its associated guidelines to incorporate methane emissions capture. This measure, he said, will ensure the elimination of gas flaring/venting and monetisation of gas resources in the country, among others.

On plans to curb crude theft, Komolafe said in line with President Muhammadu Buhari’s directive, the commission had evolved additional initiatives to collaborate with oil and gas operating companies and the top echelon of the security forces to put an end to the menace of crude oil theft in the interest of the nation.

He explained that the commission “has commenced full-scale audit of crude oil theft and assessment of upstream assets integrity audit to establish actual crude oil theft figures in the upstream petroleum industry.

“This is in view of recent controversial figures on theft volumes thrown up by some industry operators, which impact negatively on federation revenue. This is very important as the nation derives its royalty from net crude oil receipts.”

He said the commission obtained necessary approvals to implement advance cargo declaration regime in upstream petroleum operations to curtail export of stolen crude oil.

He said: “This will be done by ensuring that crude oil and gas cargoes exported from Nigeria will have a unique identifier that confirms all documentation as regards the exported consignment.

“This implies that any cargo that does not have the unique identifier was not legitimately exported from the country,” he noted.

Komolafe said the commission had obtained necessary approvals to ensure installation of metering equipment in the upstream to avert potential manipulation of figures that could result in short-changing the federation of oil and gas revenue.