DPR Evaluation: Proposal development

The Department of Petroleum Resources is currently under pressure as a result of falling oil and gas reserves following the threat of the development to the country’s economy. The agency has developed short and medium-term strategies to increase the reserves. Also, there are long-term strategies targeted at sustaining the reserves. Our correspondent gathered that the DPR planned to undertake more seismic data coverage for better regional and basinal studies and drilling of exploration wells in the short to medium term. It is also working towards active exploration drilling and drilling for deeper plays in the short to medium term. To sustain the reserves, it hopes to implement enhanced recovery methods for the short, medium and long terms; and also achieve unitisation of non-straddled reservoirs in the short to medium run. More so, it is considering bitumen exploration and exploitation in the short, medium and long terms; while developing small (marginal) fields in the short to medium terms. The DPR is also targeting frontier exploration in ultra deep water and inland basins in the medium to long terms, with regular licensing rounds to ensure continued exploration and production activities in the short to medium terms. Short term according to the agency is between one and five years; medium term between five and eight years, and long term above eight years. The DPR said, “The Niger Delta is finally showing signs of maturity as its reserves are beginning to drop. The negative trend in reserves is a major industry concern, considering the importance of oil and gas to national economy “A combination of methods would be required to drive exploration and boost reserves within the matured Niger Delta and frontier basins including the Bitumen belt.” The DPR maintained that it is evaluating several initiatives that will boost exploration activities in the country The agency, which is targeting new hydrocarbons from frontier exploration, said the Inland Basins were believed to hold huge accumulation of resources that were yet to be explored. On the Ultra Deep Offshore, it said, “The Ultra Deep Waters Frontier is yet to be fully explored in spite of its potential. “With present-day technology and the success achieved in the Deep Offshore, ample opportunities exist in encouraging aggressive exploration through periodic licensing round.” This, therefore, informed DPR’s recent announcement of March 2015 as deadline for non-performing marginal field operators. The Director, DPR, Mr. George Osahon, had announced recently that come March 2015, all marginal field licences awarded in 2004 must commence production or be re-possessed by government. He, however, reiterated that government was willing to give the necessary support to operators to assist them fulfill the intentions of the marginal field policy which was primarily designed to give indigenous operators a platform for qualitative participation in the nation’s oil exploration and production sector and build Nigerian content capacity. Osahon said the DPR remained committed to bringing operators, potential investors, financial institutions and allied interests together to explore opportunities of mutual benefits, owing to the fact that a lack of adequate access to funding had constituted a major hindrance to the marginal field exercise. Sadly, only nine fields are currently producing out of the 24 fields awarded to 31 operators in 2004. The DPR boss had identified other challenges confronting marginal fields operators to include: lack of adequate infrastructure; insecurity and community challenges; ownership and partnership tussles; contracting and procurement issues; and technology deployment. Slow pace of the development of the marginal fields since the award of licences and the inability to mature many of the fields to production had been identified by DPR as having attendant implications on the national reserves and production growth, as well as indigenous capacity development.