· Marginal field operators in race to avert DPR’s
axe
Sixteen out of the 28 oil blocks
whose licences were issued through the 2003 marginal bid round programme are at
the risk of being revoked for remaining unproductive since then. It was learnt
that already, the Department of Petroleum Resources (DPR) had given a March
2015 deadline to all unproductive marginal oil blocks owners to develop them or
they would lose their licences.
whose licences were issued through the 2003 marginal bid round programme are at
the risk of being revoked for remaining unproductive since then. It was learnt
that already, the Department of Petroleum Resources (DPR) had given a March
2015 deadline to all unproductive marginal oil blocks owners to develop them or
they would lose their licences.
Three months to the expiration of
the deadline, some of the owners, sources said at the weekend, had intensified
efforts to escape the hammer. A source at the Ministry of Petroleum Resources,
however, said the owners of the marginal fields, “some of who are politicians
and those close to government,” have begun scheming to avert the DPR axe. “It
is normal for them (marginal oil blocks owners) to lobby government to avert
the revocation of their licences.
the deadline, some of the owners, sources said at the weekend, had intensified
efforts to escape the hammer. A source at the Ministry of Petroleum Resources,
however, said the owners of the marginal fields, “some of who are politicians
and those close to government,” have begun scheming to avert the DPR axe. “It
is normal for them (marginal oil blocks owners) to lobby government to avert
the revocation of their licences.
Don’t forget that they made a lot
of investments in these blocks, but the bottom line is that things have to be
done and have to be done right. “They have been given a 10-year deadline to
make these oil blocks productive. This 10-year window was also extended when
they could not meet up.
of investments in these blocks, but the bottom line is that things have to be
done and have to be done right. “They have been given a 10-year deadline to
make these oil blocks productive. This 10-year window was also extended when
they could not meet up.
It is this new extension that will
expire by March 2015, which is barely three months away. “The question of
whether the DPR will be able to go ahead with its threat or not would be
addressed soon but what I can confirm to you is that there is a serious
scheming going on now to stop the DPR by getting another extension of
deadline,” he said.
expire by March 2015, which is barely three months away. “The question of
whether the DPR will be able to go ahead with its threat or not would be
addressed soon but what I can confirm to you is that there is a serious
scheming going on now to stop the DPR by getting another extension of
deadline,” he said.
Director of DPR, Mr. George Osahon,
told New Telegraph that the government understood challenges of funding and
technology facing marginal field operators, but there was no going back on the
March 2015 deadline “Non-producing marginal fields would be withdrawn from the
operators in March 2015, unless reasonable commitment is ascertained by the
government,” he said on the sideline of a conference in Lagos.
told New Telegraph that the government understood challenges of funding and
technology facing marginal field operators, but there was no going back on the
March 2015 deadline “Non-producing marginal fields would be withdrawn from the
operators in March 2015, unless reasonable commitment is ascertained by the
government,” he said on the sideline of a conference in Lagos.
Acknowledging that the government
was aware of the challenges facing the operators in the areas of funding and
technology, Osahon added that the government was also concerned about the
inability of the operators to meet government’s objectives of bringing the
fields to production. He urged the operators to form cluster groups, where
possible, for the development of the assets. According to him, a total of 28
marginal fields were awarded to indigenous companies in Nigeria “We have a
deadline of March 2015 for those that have held marginal fields since 2003.
was aware of the challenges facing the operators in the areas of funding and
technology, Osahon added that the government was also concerned about the
inability of the operators to meet government’s objectives of bringing the
fields to production. He urged the operators to form cluster groups, where
possible, for the development of the assets. According to him, a total of 28
marginal fields were awarded to indigenous companies in Nigeria “We have a
deadline of March 2015 for those that have held marginal fields since 2003.
The 10 years given to them have
elapsed. The fields will not be allowed to remain like that forever. It is not
to punish them,” he said. However, the sixteen unproductive marginal fields
have suffered further abandonment as the oil price rout rocking the global
crude market hit harder on the marginal fields’ production and assets.
elapsed. The fields will not be allowed to remain like that forever. It is not
to punish them,” he said. However, the sixteen unproductive marginal fields
have suffered further abandonment as the oil price rout rocking the global
crude market hit harder on the marginal fields’ production and assets.
Global exploration projects worth
more than $150 billion are also likely to be put on hold next year as plunging
oil prices render them uneconomic. The marginal field programme is an offshoot
of the Federal Government’s policy to promote indigenous participation in the
upstream sector of the petroleum industry but checks by New Telegraph showed
that the ongoing crude price fall has made further investments in them to be
unattractive.
more than $150 billion are also likely to be put on hold next year as plunging
oil prices render them uneconomic. The marginal field programme is an offshoot
of the Federal Government’s policy to promote indigenous participation in the
upstream sector of the petroleum industry but checks by New Telegraph showed
that the ongoing crude price fall has made further investments in them to be
unattractive.
“Just eight of the 28 fields
awarded in 2003 are currently producing, with over 40 new wells drilled by the
awardees, representing a four-fold increase. But the bad news is that the price
fall has made investments in the eight fields unattractive and works on the
remaining 16 unproductive fields to be non-lucrative,” an industry source said.
It was also gathered that the ongoing price fall has also become a setback to
the 2013 new marginal field bid round, which has been unofficially delayed.
awarded in 2003 are currently producing, with over 40 new wells drilled by the
awardees, representing a four-fold increase. But the bad news is that the price
fall has made investments in the eight fields unattractive and works on the
remaining 16 unproductive fields to be non-lucrative,” an industry source said.
It was also gathered that the ongoing price fall has also become a setback to
the 2013 new marginal field bid round, which has been unofficially delayed.
Source: New Telegraph
