Deep Water Exploration
From the very beginning of oil exploration in Nigeria in 1937, till early
1993, virtually all exploration and production activities were restricted to
land and swamps. Where prospecting ventured offshore, it was in areas not
greater than 200m water depth.
But then in 1993, the Federal Government opened up a new frontier in oil and
Gas exploration, heralding the bright prospects of a promising future, by
allocating some offshore blocks in water depths reaching 2500m. these deep
water depth and plans for even greater depths than 2500m will undoubtedly
impact positively the country’s production and reserve blueprint. Though
these deep water operations are technically challenging and massively
capital intensive, experience multinational companies have been awarded some
deep offshore blocks and even ultra deep concessions. By the end of 1998,
the deep water operators in Nigeria had achieved the following:
·
Acquisition of21,000 km 2D Seismic Lines
·
Acquisition of21,500 km 3D Seismic Lines
·
Drillingof33 exploration/appraisal wells in depths ranging from 300-1460m.
Even better news is significant discoveries reported by most of the
operators. Little wonder then, that against a commitment of $864 million USD
for the first 6 (six) years of deep water prospecting under a PSC
(production sharing contract) the industry has invested approximately $1.3
billion USD up to the end of 1998.
Operators have, indeed, continued aggressive exploration activities
virtually in spite of the volatile global petroleum atmosphere of recent
times, and long lead times from discovery, production and sales.
The technical challenges of deep and ultra-deep water depths has meant a
number of less than 20 wells drilled worldwide in water depths greater than
1000m. Expectedly, since most of the deep water activity in Nigeria is in,
so called, virgin territory, thereby lacking infrastructural support and
services, the cost of prospecting is extremely high.
This is however ameliorated and set off against the PSC with the Federal
Government of Nigeria under the aegis of the NNPC.
Oil Production
NNPC upstream operations are in joint partnerships with the major oil
companies. These multi-national E & P companies are operating predominantly
in the on-shore Niger Delta, coastal offshore areas and lately in the
deepwaters. As with many other developing countries, the multinationals in
Nigeria had been operating under what is called a concession system, with
NNPC being the concessionaire, while the companies are the operators. NNPC
also is responsible for the management of the exploration bidding rounds for
oil and gas.
The multinational oil companies operate in partnership with NNPC under Joint
Operating Agreements (JOAs) or Production Sharing Contracts (PSCs). Others,
especially the indigenous oil companies, operate in partnership with
international companies under sole risk or as independents. Nigeria's
petroleum industry is well grounded in successful exploration, beginning
with the first commercially viable discovery at Oloibiri in the Niger Delta
in 1956, with a modest production rate of 5,100 barrels per day. Reserves of
crude oil stand at 28.2 billion barrels. Natural gas reserves total 165
trillion standard cubic feet (scf), including 75.4 trillion scf of
nonassociated gas.
An important ingredient in NNPC's exploration success is the Integrated Data
Services Ltd (IDSL), a subsidiary of NNPC. IDSL is one of the largest and
most advanced earth science facilities in Africa. Field data is sent to IDSL
for analysis using advanced computer systems, giving the company the
critical edge in its upstream operations. IDSL processes and interprets in
3-D configurations data from the hydrocarbon reservoirs. This technological
capability is instrumental in developing reservoir management strategies,
which provide optimum recovery rates over the life of a field.
IDSL has been responsible for most of the country's major oil discoveries
and is continuing an intensive exploration programme to increase the
nation's hydrocarbon reserves.
PRODUCTION
With a maximum crude oil production capacity of 2.5 million barrels per day,
Nigeria ranks has Africa's largest producer of oil and the sixth largest oil
producing country in the world. Nigeria appears to have a greater potential
for gas than oil. Nigeria's gas production in the year 2000 was
approximately 1,681.66 billion scf, 1,3715 billion scf was associated gas
and the rest 310.16 billion was nonassociated gas.
Nigeria produces only high value, low sulphur content, light crude oils -
Antan Blend, Bonny Light, Bonny Medium, Brass Blend, Escravos Light,
Forcados Blend, IMA, Odudu Blend, Pennington Light, Qua-Iboe Light and
Ukpokiti.
NNPC through its subsidiary the Nigerian Petroleum Development Company
(NPDC) is directly responsible for four oil and gas fields with a total
production of 15,000 bpd.
NPDC is committed to expand its production capacity and has thus entered
into strategic alliance with Agip Energy to develop the Okhono offshore
field.
The Nigerian Gas Company, a subsidiary of NNPC transmits gas to major
commercial centres in the country. The Escravos -Lagos pipeline feeds the
commercial nerve-centre of the nation, as well as fuelling the main power
station at Egbin, near Lagos.
Gas Production
NNPC's vision is to make Nigeria the leading Liquified & Natural Gas
(LNG) producing nation in the world and to promote sufficiency in the
domestic power supply.
We intend to acheive this goal by monitoring the commercialization of
Nigeria’s abundant natural gas reserves, reducing gas flaring,
promoting viable LNG projects, power plants and associated gas projects.
The Federal Government has set the following objectives for NNPC as
regards Gas production:
·
To monitor and expedite the commercialization and the development of Natural
Gas for Domestic and Export markets
·
To protect the Federal Government interest in LNG & IPP ventures
·
To monitor and support all LNG and Independent Power Plants (IPP) ventures
·
To support NNPC Human Resource capacity building
·
To work towards achieving and sustaining “zero” flaring of Associated Gas
·
Promote the Nigerian
Content initiative.
Joint Venture Activities
NNPC upstream operations are in joint partnerships with the major oil
companies. These multi-national Exploration & Production companies are
operating predominantly in the on-shore Niger Delta, coastal offshore areas
and lately in the deepwaters.
As with many other developing countries, the multinationals in Nigeria had
been operating under what is called a concession system, with NNPC being the
concessionaire, while the companies are the operators.
NNPC also is responsible for the management of the exploration bidding
rounds for oil and gas.
The multinational oil companies operate in partnership with NNPC
under Production Sharing Contracts (PSCs).
Greenfield Refinery Initiative
The West & Central African Region consists of 18 countries from Mauritania
in the North to Angola in the South. Total population is estimated at 290
Million with a GDP of about $340 billion. Nigeria accounts for about half of
the regional population.
Refineries and Petrochemicals
The downstream industry in Nigeria is well established. NNPC has four
refineries, two in Port Harcourt (PHRC), and one each in Kaduna (KRPC) and
Warri (WRPC). The refineries have a combined installed capacity of
445,000 bpd. A comprehensive network of pipelines and depots strategically
located throughout Nigeria links these refineries.
The PHRC is made up of two refineries, located at Alesa Eleme near Port
Harcourt with a jetty (for product import and export). The jetty is located
7.5km away from the refinery complex. In 1983, the Port Harcourt refinery
with 60,000 bpsd name plate CDU capacity and the tankage facilities were
acquired by NNPC from SHELL. Subsequently, a new 150,000 bpsd export
refinery was built in 1988 and commissioned in 1989. Therefore, the current
combined installed capacity of PHRC is 210,000 bpsd.
The installed capacities of KRPC and WRPC are 110,000 bpsd and 125,000 bpsd
respectively.
NNPC, through its subsidiary, the Pipelines and Products Marketing Company (PPMC),
supplies only to bulk customers. They, in turn, meet the needs of millions
of customers across the country for products ranging from gasoline and jet
fuel to diesel, fuel oil and liquefied petroleum gas.
REFINERIES:
v PORT HARCOURT REFINING COMPANY (PHRC)
v KADUNA REFINING & PETROCHEMICAL COMPANY LIMITED (KRPC)
v WARRI REFINING & PETROCHEMICAL COMPANY LIMITED (WRPC)
NOTE: NNPC
produces linear alkyl benzene, benzene, heavy alkylate and deparafinated
kerosene at its Kaduna Refinery complex. Linked to the Warri Refinery are a
35,000 metric ton per annum (mtpa) polypropylene plant and an 18,000-mtpa
carbon black plant.
Nigerian Gas Master Plan
As part of Nigeria's resolve to become a major international player in the
international gas market as well as to lay a solid framework gas
infrastructure expansion within the domestic market, the Nigerian Gas Master
Plan was approved on February 13 2008.
The Master-Plan is a guide for the commercial exploitation and
management of Nigeria’s gas sector.
It aims at growing the Nigerian economy with gas by pursuing three key
strategies:
1. Stimulate the multiplier effect of gas in the domestic economy
2. Position Nigeria competitively in high value export markets
3. Guarantee the long term energy security of Nigeria
Renewable Energy
Since civilization man has met his energy needs one way or the other. Modern
man has depended largely on fossil fuel which is non renewable and has been
the major cause of greenhouse gas emissions thereby degrading the
environment. In 2005 a presidential directive was given to the NNPC for the
exploration of Renewable Energy as a source of energy i.e. energy that is
replaced by a natural process at a rate that is equal to or faster than the
rate at which that resource is being consumed. This led to the creation of
the Renewable Energy Division (RED) of the NNPC in August 2005. The Division
is to midwife the birth of renewable energy initiatives of the NNPC. This is
consistent with the dictates of the Kyoto protocol of which Nigeria is a
signatory.
NNPC is to spearhead the launch of a bio-fuel program for Nigeria which aims
at creating a sustainable domestic industry by integrating the energy and
agricultural sectors of the country. The rationale for the program, which is
aimed at growing a thriving home grown industry includes; providing jobs and
economic empowerment to rural communities, reducing Nigeria’s dependence on
fossil fuels and protecting the environment while participating in the Clean
Development Mechanism (CDM) program.
The NNPC through the RED has initiated the Automotive Bio-fuel program for
the production of fuel-ethanol and bio-diesel that would be blended with PMS
(Premium Motor Spirit) otherwise know as Petrol and AGO (Automotive Gas
Oil), in proportions not exceeding 10% volume. The resulting new fuel which
is to be called “Green Gasoline” will reduce the volume of carbon dioxide
released into the atmosphere, improve air quality and ultimately reduce
global warming and its catastrophic consequences.
Gas & Power
As part of Nigeria's resolve to become a major international player in the
international gas market as well as to lay a solid framework gas
infrastructure expansion within the domestic market, the Nigerian Gas Master
Plan was approved on February 13 2008.
The Master-Plan is a guide for the commercial exploitation and
management of Nigeria’s gas sector.
It aims at growing the Nigerian economy with gas by pursuing three key
strategies:
1. Stimulate the multiplier effect of gas in the domestic economy
2. Position Nigeria competitively in high value export markets
3. Guarantee the long term energy security of Nigeria
Engineering & Technology
NNPC uses state of the art technologies to provide support services to all
arms of the corporation and some external client. Its engineering and
technology services include Information technology, telecommunications,
Basic/Detailed Engineering, Procurement, construction Supervision and
Engineering Project Management.
Retail Services
NNPC operates retail outlets with efficient service delivery of petroleum
and allied products to customers in an environmentally friendly manner.
Product Distribution
The pipelines and product marketing company (PPMC) is the the product
distribution arm of NNPC. PPMC is directly responsible for the comparative
ease with which petroleum products are sourced and distributed to all
parts of the country, at a uniform price: a phenomenon which Nigerians have
come to take for granted. PPMC, a subsidiary of NNPC, ensures, among other
things, the availability of petroleum products to sustain our industries,
run automobiles and for domestic cooking.
MODE OF OPERATION
PPMC receives crude oil from the NNPC unit called the NATIONAL PETROLEUM
INVESTMENTS MANAGEMENT SERVICES(NAPIMS).PPMC then supplies the crude oil to
the NNPC local refineries however, petroleum products are sometimes
imported to supplement local production when the local refineries are unable
to process enough for the country’s needs.
Petroleum products are either imported or refined locally are received by
the PPMC through import jetties and pipelines and distributed through
pipelines to depots strategically located all over called bridging to
designated retail outlets. There is also provision for using the rail system
to move from some of the PPMC depots.
Investment Opportunities
Investment opportunities in the downstream sector include:
·
refined mineral oil, petroleum jelly and grease
·
bituminous based water / damp proof building materials e.g. roofing sheets,
floor tiles, tarpaulin, and
·
building of asphalt storage, packaging and blending that may export these
products.
Companies with the technology can undertake turn around maintenance of
refineries. There is a tremendous scope for small-scale joint venture
manufacturing concerns with foreign technical partners. Such ventures can
start warehousing arrangements that will ensure continuity of supply at
competitive prices.
Research & Development
Established in 1977 to solve the operational and technical problems of the
oil and gas industry through the application of the results of scientific
research and the development of technology. R&D has highly qualified
personnel and experienced engineers.
NNPC, R&D is ISO 9001:2000 certified with upgrade to ISO 9001:2008 in
progress. R&D is also in the process of obtaining certification for
ISO 14000 Environment and ISO 17025 Laboratory accreditations
PVT Analyzer
In the upstream sector, our capabilities include:
·
Basin Analysis
·
Petroleum Source Rock Evaluation
·
Seismic Studies
·
Reservoir Simulation
·
Formation Evaluation
·
Reservoir Characterization
·
Biostratigraphic studies
·
Conventional and special core analysis
·
Geochemical and Geophysical studies
·
PVT Analysis
·
Formulation of drilling fluids from local raw materials
·
Formation damage studies
·
Enhanced oil recovery methods, etc.
Our capabilities here include:
Our capabilities here include:
Crude Assay Analyzer
·
Collaborative Research Services with National Oil Companies (Petrobras,
Saudi Aramco,…etc), OPEC, National Government Agencies and Independent Oil
Companies (IOC)
·
New Businesses such as:
1.
Glassblowing production
2.
Renewable Energy studies on Biofuels and Solar energy
·
Technical Services to Oil & Gas companies such as:
· Process Simulation
studies using HYSIS
· Energy optimization
studies
· Troubleshooting of
plants operational problems
· Improvement of
existing processes and development of new ones
· New products
development in fuels, lubes, bitumen and petrochemicals
· Natural gas
utilization for the production of solvents
· Catalysts
characterization,
· Environmental
research studies and services
· Toxicological
studies
· Catalysis
development
· Air monitoring of
virgin industrial areas.
· Petroleum products
testing, total crude assay, analytical chemistry, etc.
·
Analysis of cores for SPDC, Mobil and NAPIMS
·
High resolution Biostatigraphic & Sedimentological studies for Chevron,
Exxon Mobil, SNEPCO, NAE, etc.
·
Crude Oil assay for NAPIMS, COMD, LASER engineering, PHRC, Consolidated Oil
(CONOIL) etc.
·
Environmental Studies for SPDC, NPDC, NGC etc
·
High resolution Biostatigraphic studies for SPDC, NAE.
·
Environmental Compliance monitoring studies for SPDC.
·
Crude Oil Assay for NAPIMS, LASER Engineering
·
Analytical Chemistry services
·
Hysis evaluation .
