28 Years After Pulling Out, NNPC Resumes Crude Oil Drilling Campaign in Chad Basin

Nigerian National Petroleum Company Limited (NNPC) formally resumed its drilling campaign in the Chad Basin, Borno State, yesterday, almost three decades after it withdrew from the site due to the discovery at the time that the oil find was not in commercial quantity.

NNPC assured that it had now taken a wholesale review of the likelihood of finding more reserves in the frontier basins in the country, which led to the discovery of oil recently in the Kolmani River, straddling Gombe and Bauchi states.

Speaking during the flag-off of the Wadi-B drilling campaign ceremony, which took place at the site in Jere Local Government Area of Borno State, President Muhammadu Buhari assured that the whole essence of the search for oil in the north was to grow the country’s reserves, which currently stands at 37 billion barrels.

Stressing that the oil drilling campaign signalled the formal resumption of physical activities for the exploration of crude oil and gas in the Chad Basin area, the president, who joined the programme virtually, recalled that crude oil and gas exploration activities had been on-going in the Chad Basin since 1976.

He said the active drilling activities were suspended in 1995 to enable the re-evaluation of exploration activities in the entire frontier basins.

Buhari stated, “The NNPC has since then conducted extensive basinal analysis and evaluation of oil frontier indices, leading to the successful discovery of crude oil and gas in commercial quantities in Kolmani River 2 and providing insight into the on-going crude oil and gas drilling campaign in Nasarawa State as well as the current re-entry activities into the Chad Basin.

“The consequential effect of the likely positive outcome of the Chad Basin exploration campaign is an increase in national crude oil and gas reserves and production, enhanced national energy security, and greater prosperity for our people.”

The president asserted that he was looking forward to a successful drilling campaign at the Chad Basin through the collaborative efforts of NNPC Limited, Nigerian Upstream Petroleum Regulatory Commission (NUPRC), government security agencies, and other stakeholders, including the people and government of Borno State.

“I congratulate the board, management, and staff of the NNPC Limited and that of the NUPRC for their dogged determination and efforts towards developing the hydrocarbon potential of the country’s frontier basins, leading to the momentous event of today,” Buhari added.

The president appreciated the government and people of Borno State for their support and efforts towards ensuring the resumption of drilling campaigns in the basin.

In his remarks, Group Chief Executive Officer of NNPC, Mallam Mele Kyari, noted that the remobilisation of drilling rig to the Chad Basin for the first time since 1995 meant that the situation had markedly changed since then.

Kyari stated, “We stopped drilling here in 1995 because the successes were weak and because the findings were not commercial.

“We understood very clearly that we needed to understand the basin very well, we needed to have a different approach to exploration activity in this basin. And that’s why the NNPC and our partner, the erstwhile Department of Petroleum Resources (DPR) and the current NUPRC, decided to embark on massive evaluation of all the frontier basins in the country.

“And, of course, our findings have been useful. Our understanding of the rift system in Nigeria enabled us to have successful outcome in the Kolmani area and also enabled us to mobilise to Nasarawa State where drilling activity and engagement is going on.

“It also helped us to understand the Chad Basin, the geological setting in the Chad Basin, which is why we are back here. Now we are much more confidant and we believe that this campaign will be successful. And that this campaign will take us to the ultimate objective, which is to increase the reserve of our country and also create opportunities around us.”

Kyari added that NNPC also believed it would take a long time before oil and gas could “vanish”, declaring that the commodity will continue to be the “very principal” in the determination of prosperity for the country and provision of energy security for the people.

He said, “And this can’t happen except you have access to the resources and we are able to convert them into value and being able to do this as quickly as is practical, which is to do what we’re doing now in the Kolmani area. Wherever we find new oil, we will consider the concept of integrated production and conversion so that value can be created very, very quickly.”

Kyari said there was still huge energy poverty across the world, more so in Sub-Saharan African countries, stressing that 70 per cent of Nigeria’s population do not have access to clean cooking fuels.

He explained, “And that is why you’re seeing the effect of deforestation, which is most pronounced in this part of the country. And it is also clear and known to everyone that the Sahara Desert moves at least a kilometre southwards every year.

“And this can be arrested if we could find alternative sources of energy for the communities. And this is what the oil and gas would do.”

Chief Executive of NUPRC, Mr Gbenga Komolafe, said the event also marked another milestone in the decades of hydrocarbon exploration, appraisal and prospectivity studies of the inland frontier bases and further underscored that the government was interested in making the requisite investments in oil exploration.

While thanking Buhari for his commitment to “mitigating energy poverty, creating shared prosperity, and true sustainable growth in the Nigerian economy”, Komolafe reiterated the commitment of stakeholders to maturing Nigeria’s hydrocarbon resources in the frontier bases.

“This spud-in ceremony couldn’t have come at a better time, especially given the recent global events that border on energy security and energy transition,” he pointed out.

One of the key regulation focuses of NUPRC, Komolafe stated, was to grow Nigeria’s national oil reserves from the current 37 billion barrels of oil to 40 billion barrels of oil by 2030.

Considering the positive prospectivity results recorded so far, Komolafe noted that the project aligned with the objectives of the Petroleum Industry Act (PIA), which enabled the commission to establish exploration fund to de-risk exploration in the frontier basins.

He assured that NNPC, being Africa’s largest company, would deliver on its commitment to make energy available and accessible, as Nigeria harnessed its resources for the benefit of its growing population.

Similarly, Governor Babagana Zulum of Borno State said the commencement of oil drilling in the region was a right step in creating more job opportunities in the state and further reducing insurgency. Zulum pledged his full support for the project.

The governor stated that the president had already constructed mass housing, 50mw power plant and provided massive support for displaced persons, noting that the people of the state remain appreciative.

Zulum said, “Oil prospecting, possible discovery and exploration in this part of the country will, no doubt, create job opportunities to thousands of our youths thereby reducing unemployment in our state, which in turn will result in reduction in insurgency, stimulating economic growth and development of our dear state and nation, in general.”

NNPC Chair, Margery Okadigbo, congratulated the people of Borno State and thanked the president, stressing that with the PIA, Nigeria was set to explore new frontiers.

The Shehu of Borno, Abubakar Ibn Umar Garba Al Amin El-Kanemi, in his address, expressed joy that the project was becoming a reality. He stressed that the state will get improved revenue when it comes on-stream.