Baru takes front seat in renewed frontier oil exploration

Speaking to members of the Nigerian Association of Petroleum Explorationists (NAPE) during a dinner organized in his honour recently, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Dr. Maikanti Kacalla Baru, emphasized the need to increase the nation’s oil and gas reserves. In particular, he said Nigeria’s 2016 national average daily oil production of about 1.9Million barrels (low partly due to oil infrastructure vandalism) when compared to its current oil reserves of about 35Billion barrels can only last for about 40 years, assuming no reserves are added.
Similarly, the GMD noted, with current gas reserves of 187Tcf and at the current level of production of 8Bscfd, Nigeria’s gas reserves will last for about 65 years also assuming no added reserves. In another revelation, Dr. Baru explained that by 2020, Nigeria’s gas demand forecast for both domestic and export would experience a rapid growth to 15bscfd. This therefore means that current reserves level can only sustain such a quantum of demand for 35 years.
It is in the wake of this reality that President Muhammadu Buhari directed the corporation to resume oil exploration activities in some of the nation’s inland basins which include the Chad Basin and the Benue Trough. To take the lead role in this new venture was the GMD NNPC. For someone whose career spanned several years in the Exploration & Production sector of the industry, there was no better person to achieve this Presidential mandate. If anything, one of Dr. Baru’s cardinal 12 Business Focus Areas – aimed at placing NNPC on the path of growth and profitability – is increasing production and growing reserves.
This Presidential directive is well-informed. As a former oil Minister and the current senior petroleum Minister, President Muhammadu Buhari knows pretty well the importance of increasing hydrocarbon reserves. Therefore, when he gave that mandate to the GMD, the President knew exactly what he wanted. The President was convinced by professional counsel given that Nigeria’s neighbours – Niger, Chad and Central African Republic -all had successful commercial discoveries of oil and gas within their portions of the Chad Basin. It is this geological similitude backed by a strong political will, more advanced technology (3D Seismic) driven by experienced personnel that gave Nigeria the hope that the right time to search for oil on its own end of the Chad Basin is now.
As a thoroughbred upstream professional, Dr. Baru knows pretty well that growing reserves cannot be done in front of computers. As he has reiterated at many fora, reserves can only be grown by taking on the challenge of venturing into fresh oil and gas frontiers across the country headlong. The Chad Basin and Benue Trough are believed to have substantial deposits of oil and gas hydrocarbons. Thus, his recent official visit to Bauchi and Gombe States was not only a statement of intent; it was a big, bold step at executing the Presidential mandate.
To properly drive this message home, the GMD met the Governors of Bauchi and Gombe States, Barr. Muhammed Abdullahi Abubakar and Dr. Ibrahim Hassan Dakwambo respectively. During the visit, he officially announced to the two Governors the commencement of resumption of oil and gas exploration in the Gongola Basin segment of the Benue Trough which includes areas within the two States. These areas include Alkaleri, Darazo, Misau and Ganjuwa (in Bauchi State) and Akko, Dukku, Billiri, Balanga, Funakaye and Nafada (in Gombe State).
In their responses, the two governors pledged their support to NNPC. While Governor Abubakar promised to provide offices and accommodation for all NNPC staff involved in the project, Governor Dankwambo went a notch higher, nominating two Commissioners to support NNPC with logistics towards the project’s success. In order to galvanize host community support towards the entire exploration activity, the GMD was also at the Palaces of Emir of Bauchi, Alh (Dr.) Rilwanu Suleiman Adamu, CFR; Emir of Gombe, Alh. Abubakar Shehu Abubakar III and Emir of Misau, Alh. Ahmed Sueiman, mni.
For the three Emirs, the message was the same: they all promised to sensitize and educate their subjects on the resumed NNPC operations and the need to cooperate with NNPC personnel and safeguard the Corporation’s heavy equipment which will soon be deployed within their domains. While pleading with the monarchs to educate their subjects on the project, the GMD also urged the teeming youths of the various areas to utilize the employment opportunities that will be provided by the exercise.
Happily though, this is a familiar terrain for the NNPC. Like the GMD rightly mentioned, this is not the first time the Corporation is exploring for oil in the Gongola Basin. It is worthy to recall that the then Exploration and Exploitation (E & E) Division of NNPC commenced exploration activities in the Chad Basin in 1977 and continued till 1996. During these periods, Twenty Three (23) wells were drilled out of which two (2) recorded non-commercial gas discoveries (Wadi-1 & Kinasar-1). Exploration was then suspended in the Chad Basin in the year 2000 for lack of commercial finds.
Meanwhile, between 1993 and 2000, the Federal Government awarded blocks in the Gongola Basin to three (3) International Oil Companies (IOCs), namely Chevron, TOTAL and Shell Nigeria Exploration and Production Company (SNEPCo).  These companies acquired 3,153km of 2D seismic data, and drilled one well each. One of the wells drilled, Kolmani River-1 made non-commercial gas discovery (33Bscf). By the provision of the contract agreement between the Federal Government and the IOCs, the minimum work commitment was fulfilled. Hence the IOCs suspended operations and relinquished the blocks.
In 2002, the Federal Government directed further evaluation and consolidation of the data generated in the Chad basin to further ascertain the prospectivity of the Basin. The study formed the basis for the exploration re-entry in 2009 with the acquisition of over 1,900 Sq.km 3D seismic data before the suspension of activities in November, 2014 due to security challenges occasioned by the insurgency in the North East.
Already, the NNPC has awarded the contract for seismic data acquisition of over 500Sq.km 3D seismic data in the first instance to the Integrated Data Service Limited (IDSL) a subsidiary of NNPC and Bureau for Geophysical Prospecting, a subsidiary of China National Petroleum Corporation (BGP/CNPC). Both companies are mobilizing to commence work in the affected areas. “We are confident that these efforts will lead to clearer definition of the prospectivity of the basin,” the GMD assured the two Governors.
One key success factor towards this operation is Corporate Social Responsibility (CSR). The NNPC is not shying away from that. As a responsible corporate citizen, the Corporation is in the process of awarding the Environmental Baseline Studies (EBS) and Environmental Impact Assessment (EIA) of the Upper Benue Trough to Abubakar Tafawa Balewa University, Bauchi and Modibbo Adama University of Technology, Yola respectively. Still, as part of the CSR efforts towards this project, a number of sustainable community development projects are being considered for the benefit of the various communities within the exploration area.
It is instructive to note that as far as this latest exploration is concerned, NNPC’s commitment remains unshaken. The Corporation under Dr. Baru is refining its strategy to ensure that it utilizes all geological approaches that have enabled Chad and other neighbouring countries to be producers. If anything, success within the Chad and Gongola Basins could spur further exploration efforts in other inland basins such as Anambra, Bida, Yola and Sokoto to mention but a few.
Nigeria cannot afford not to take advantage of increasing its oil and gas reserves especially in this era of low oil prices which makes inland exploration cost bearable. Already, it is on record that successful exploration efforts have been pioneered in the Dahomey Basin following the coming on-stream of the Aje field by Yinka Folawiyo Petroleum in Lagos. With Dr. Baru now vigorously leading a renewed exploration quest into the Chad Basin & Benue Trough, it is potentially safe to say that as far as reserves growth is concerned, Nigerians will soon have every reason to be excited.
Abubakar is the Technical Assistant on Communications to the GMD NNPC.