The number of platforms in Nigeria drops by 55.34% in Q1 ’21

Stock photo of an offshore oil rig

By Udeme Akpan

Nigeria’s drilling rig count fell 55.34% in the first quarter, from January to March 2021 to 19, according to data gathered from recent reports by the Organization of the Petroleum Exporting Countries, the OPEC.

The number of platforms, a major index of measurement activity in the upstream sector, stood at 65 in the corresponding period of 2020 before slipping to 19, mainly due to the delay in adopting the oil industry bill, GDP and the coronavirus pandemic. .

A breakdown showed that Nigeria used six, seven and six platforms in January, February and March 2021, respectively, compared to 21, 23 and 21 during the corresponding period of 2020.

Therefore, in its report obtained by Vanguard, the DPR’s Department of Petroleum Resources estimates the country’s oil reserves at 37 billion barrels, even though the government had previously planned to reach 40 billion barrels by 2020. .

Commenting on the development, Victoria Ibezim-Ohaeri, Director, Spaces for Change, who stressed the importance of early adoption, including improving investments, said: “GDP 2020 is a bill to introduce far-reaching industrial reforms in Nigeria. oil and gas sector.

“Among other objectives, the bill seeks to establish good governance, best practices and the ease of doing business in the industry by clarifying the roles and responsibilities of officials and institutions, to allow the exploration of borders. , demand better environmental compliance and transform the NNPC into a commercial enterprise. viable business.

“Laws governing the oil and gas industry date back to pre-independence and pre-democracy rules in Nigeria, when laws were passed without inclusion and in light of the peculiarities of the time.”

She added: “With advancements in technology, volatile oil prices, climate change influencing the driving forces of the global economy, it has become imperative to review existing laws to bring them into line with current realities.”

African Nations

Meanwhile, unlike Nigeria, other African oil and gas producing countries, such as Algeria, Libya, Gabon, Angola and Congo, examined in the study, have increased their deployment of platforms and, by extension, exploration in 2020.

More specifically, Algeria increased its number of drilling rigs to 509 in 2020 from 398 in 2019, an increase of 27.9%.

Libya increased its number of platforms to 164 in 2020 from 149 in 2019, thus showing an increase of 10.1%, while Gabon increased its deployment of platforms to 68 in 2020 from 50 in 2019, which indicates an increase of 36%.

In addition, Angola and Congo have increased the deployment of their rigs to 60 and 46 respectively in 2020, up from 38 and 12 in 2019, showing an increase of 57.9% and 283% respectively.

However, Equatorial Guinea, which deployed 12 platforms in 2020, up from 16 in 2019, saw a 25% drop.

Factors

The Energy Vanguard survey over the weekend attributed the negative situation in Nigeria to factors, in particular low investment, the prolonged delay in passing the Oil Industry Bill, GDP and the coronavirus pandemic, which has also prompted some operators to work remotely.

Implications

In a telephone interview with Energy Vanguard, Dr Bala Zaka, an energy analyst based in Port Harcourt, said: “Development has shown that Nigeria, which has failed to meet its target of 40 billion barrels of reserves by 2020, mainly due to low investment, may also fail to meet the target by 2025.

It also means that the country’s current reserves of 37 billion barrels could be depleted much faster than expected if the country does not invest heavily in exploration, necessary to make new discoveries and increase reserves.

In addition, it also means that other emerging African oil countries could overtake Nigeria, especially in terms of reserves, production capacity and world ranking.

However, in an interview with Energy Vanguard over the weekend, Professor Omowumi Iledare, Professor of Oil and Gas Economics and Management at the Ghana National Petroleum Corporation (GNPC), Institute for Oil and Gas Studies , University of Cape Coast, Ghana, said: “The number of rigs is well below expectations, knowing that Nigeria is a leading producer with 30 billion barrels of reserves and over 200 trillion cubic feet. gas standard. “

Vanguard News Nigeria


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