Dr. Ibe Kachikwu, the Minister of State for Petroleum Resources, said the Federal Government is targeting three million barrels per day (bpd) of crude oil. Kachikwu also said that for Nigeria to begin crude oil production in a new oil field, it would cost the country an average of about $10 billion per year for over three years. This initiative comes on the heels of Nigeria producing an increased number of 91,500 bpd overtaking Angola as the top oil and gas producer in Africa. Kachikwu stated that the country would be able to boost investment in the nation’s oil and gas sector to a record $100 billion in the next five years. The investment will be targeted at gas, gas infrastructure, and replacement of existing dilapidated pipelines, which will be carried out by private sector investments.
Dr. Maikanti Baru, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), has pledged commitment to the passage of the Petroleum Industry Governance Bill (PIGB) saying the corporation would do everything possible to ensure that the lawmakers avoid making mistakes in the bill. Passage of the PIGB, specifically on fiscal terms and host communities would require extensive consultation to aggregate views and opinions of industry stakeholders so as to strike a balance that could attract investments. In the fiscal terms, Baru said the major complaint by operators in the industry was that of multiple taxations such as statutory contributions to the Niger Delta Development Commission (NDDC), the Nigerian Content Development and Monitoring Board (NCDMB), as well as sundry expenses on security. Baru said: “We have to be able to design a system that works. If the three percent, 13 percent or any other statutory allocation for development is not working, then we should not be afraid to recommend a percentage that could work. This would replace the present system, where operators pay multiple taxes and yet pay much more to secure their investments”. Therefore, Baru urged the consultants to take a comprehensive look at the issues in the oil and gas sector, and make bold recommendations that could engender enduring reforms.
On Wednesday 4th April, Idriss Déby Itno, the Head of State of Chad laid the foundation stone for the first oil depot at Djermaya that holds an area of 40 hectares. It will have a capacity of 40 million liters including 4,000m3 of water for firefighting. The cost of construction of the oil depot is nearly 13 billion CFA francs with an estimated completion time of 18 months. Construction cost will be financed by the Société des Hydrocarbures du Tchad (SHT), its partners in the deposit company and the banking pool composed of Commercial Bank-Cameroun and Commercial Bank-Tchad. Tahir Hamid Nguilin, SHT General Manager said that the advent of this oil depot confirms the creation of the Chadian Petroleum Depository Company. Nguilin assured that the company will take care of continuing the construction work, capacity expansions and it will build regional depots throughout the country. Nguilin said that the construction of this oil depot will create 250 to 300 jobs during its construction phase and will permanently employ dozens of young Chadians first at the site of Dougui Allaya and gradually in all regions of Chad. Chad is one of the few African countries to cover the oil industry value chain spectrum which includes oil deposits, seismic research service stations, refining of crude oil, purification of gas, training, development, operations and transportation.
On Thursday 5th April, oil prices were higher as a fall in U.S. production supported traders and easing investors’ concern about a supply glut. The U.S. West Texas Intermediate crude rose by 0.80% at $63.88 a barrel at 10:23 AM ET (14:23 GMT), the ICE Futures Exchange in London Brent oil was up 62 cents at $68.84 a barrel. The U.S Energy Information Administration weekly report for Wednesday 4th April showed a fall in crude oil inventories by 4.617 million barrels in the week ending March 30, confounding expectations for a rise of 1.4 million barrels.
Oil prices have been stuck between the rise in U.S. shale and a deal from the Organization of the Petroleum Exporting Countries’ (OPEC) and Russia to curb production and end a global supply glut. OPEC has been cutting crude output by 1.8 million bpd to boost oil prices. The deal began in January 2017 and is set to expire at the end of 2018 but de-facto leader Saudi Arabia is pushing for the cuts to extend into 2019. OPEC member Qatar’s energy minister Mohammed al-Sada said that he supports the idea of maintaining oil supply curbs, however, while prices have recovered, there has not been an increase in investment.