Connect with us

Business News

Buhari orders extension of oil exploration to six basins



President Muhammadu Buhari has flagged-off drilling activities in the Kolmani River II oil well in the Gongola basin of Benue Trough, Bauchi state.

The “spud-in”, as it is known in the oil industry, is the second attempt at actual oil drilling in the basin following an earlier undertaking by some international oil companies (IOCs) in the early 90s but was abandoned midway.

The president also ordered the Nigerian National Petroleum Corporation (NNPC), to extend oil exploration to six basins in the country.

A statement by Ndu Ughamadu, spokesman of NNPC, said the state oil firm acquired advanced data and technology to drill deeper for more discoveries in the Gongola basin, following a presidential directive.

Speaking at the inauguration ceremony on Saturday, Buhari commended the NNPC for its role in “re-invigorating exploration operations in the basin”.

He said the exercise would help Nigeria secure her energy sources, making for a “balanced resource distribution, strong economic base, and industrialisation”.

Buhari, who also doubles as the minister of petroleum resources said that a key aspect of the Economic Recovery and Growth Plan (ERGP) is to “ensure national energy sufficiency” which can only be achieved by exploring for hydrocarbon resources not only in the conventional basins but also in the frontier basins.

A frontier basin is a basin where exploration activities have not been carried out or a basin with short-term exploration activities with a significant volume of undiscovered hydrocarbon resources.

Buhari said exploration would soon commence in other basins located in Chad, Bida, Dahomey, Sokoto, and Anambra.

In his presentation, Maikanti Baru, group managing director, said neighbouring countries were making hydrocarbon discoveries from their own end of the basin, hence the corporation’s drive to resume exploration activities at a higher level.

He explained why the IOCs withdrew from the frontier basins, adding that government will take on the initial risks that come with exploring in the host communities.  

“While the IOCs who previously explored the basin through Kolmani River-1 well, drilled down to less than 9,000 feet, the corporation would go as deep as 14,500 feet in the Kolmani River-II well,” Baru said.

“There is already a well that was drilled back in 1999 by SNEPCo, and at that time, the amount of hydrocarbons were not commercial in their own judgement but when we reviewed the data, we felt they did not complete the process and we came here based on the 3-dimensional seismic and other studies we have done.

“Of course, as you are aware, the Niger Delta is well explored and exploring frontier basins in areas that have not been explored are normally very risky and costly, and because the private sector does not want to take that risk, they expect the government to go out and look for it and once the reserves are established, then the private sector will come in and develop them.”

Click to comment

You must be logged in to post a comment Login

Leave a Reply