Kachikwu Seeks Speedy Ap­proval of Oil­field De­vel­op­ment Plans

THISDAY - - NEWS - Ejio­for Alike

The Min­is­ter of State for Petroleum Re­sources, Dr. Ibe Kachikwu, has urged oil and gas in­dus­try op­er­a­tors to col­lab­o­rate with the in­dus­try reg­u­la­tors to en­sure speedy ap­provals of Field De­vel­op­ment Plans (FDPs) to at­tract in­vest­ments to the oil and gas sec­tor.

In his key­note ad­dress at a ‘Tech­ni­cal sym­po­sium on Field De­vel­op­ment Plan (FDP) Ap­proval Process’ or­gan­ised in La­gos yes­ter­day by the So­ci­ety of Petroleum En­gi­neers (SPE) La­gos Sec­tion 61, the min­is­ter noted that FDP is one of the fun­da­men­tal cri­te­ria in the de­vel­op­ment of up­stream ex­plo­ration and pro­duc­tion projects in Nige­ria.

Kachikwu stated that it is im­por­tant that the fed­eral gov­ern­ment acts quickly to eval­u­ate and ap­prove FDPs to en­sure that the mo­men­tum of in­vestors does not dip.

He added that some of the main issues that have re­sulted in de­lay of ap­provals are the in­ad­e­quacy or in­com­plete­ness of plans that do not ad­dress all the project de­vel­op­ment issues.

Hence, as part of our seven Big Wins, we ini­ti­ated the Nige­rian Gas Flare Com­mer­cial­i­sa­tion Pro­gramme (NGFCP) as a so­lu­tion. The pur­pose of the NGFCP is to elim­i­nate wastage of gas, thereby stim­u­lat­ing eco­nomic growth, driv­ing in­vest­ments and pro­vid­ing jobs in the na­tion through the use of widely avail­able in­no­va­tive tech­nolo­gies. This ini­tia­tive will pro­vide an end-to-end so­lu­tion that will pos­i­tively im­pact the Nige­rian econ­omy. The Depart­ment of Petroleum Re­sources (DPR) will not ap­prove any FDP, un­less there is an end-to-end gas util­i­sa­tion so­lu­tion in place,’’ Kachikwu ex­plained.

He said the fed­eral gov­ern­ment deemed it tact­ful to ini­ti­ate the NGFCP, which would pro­vide mul­ti­ple op­tions elim­i­nat­ing bot­tle­necks as­so­ci­ated with FDP’s ap­proval.

He added that an­other is­sue is that when the field would ex­tend into neigh­bour­ing con­ces­sions or li­cense ar­eas and then uni­ti­sa­tion of the as­set be­comes nec­es­sary.

“If we do not pro­vide timely FDP ap­proval, it will de­layed pro­duc­tion, rev­enue, prof­itabil­ity, eco­nomic de­vel­op­ment, job cre­ations, growth and in­vest­ments in the oil in­dus­try. There­fore timely FDP Ap­proval is a win-win for both the gov­ern­ment and the in­vestors. In a sense, FDP is the roadmap for the de­vel­op­ment of any as­set in the oil and gas sec­tor. There­fore, to a large de­gree, it de­fines the suc­cess or oth­er­wise of the field. This is the doc­u­ment the reg­u­la­tor of our oil and gas in­dus­try, DPR must ap­prove be­fore the com­mence­ment of ac­tiv­i­ties in any oil field of our na­tion,’’ he added.

The min­is­ter said in Nige­ria, the en­abling law that gives le­gal back­ing to FDP ap­proval is the Petroleum Drilling and Pro­duc­tion Reg­u­la­tion of 1969.

“These laws are made pur­suant to the pow­ers con­ferred on the Min­is­ter of Petroleum Re­sources un­der Sec­tion 9 of the petroleum Act (CAP 350) laws of the Fed­er­a­tion of Nige­ria, 1990. The reg­u­la­tions put in statu­tory form –both the reg­u­la­tory and op­er­a­tional de­tails gov­ern­ing field ex­plo­ration, de­vel­op­ment and pro­duc­tion. It also pre­scribes the var­i­ous fees, rents and roy­al­ties that shall be payable when the field is put on pro­duc­tion. Fur­ther­more, the laws of Nige­ria pre­vent li­cense hold­ers from in­stalling fa­cil­i­ties or pro­duc­ing oil and gas with­out the ap­proval of the Min­is­ter of Petroleum Re­sources or its del­e­gate, DPR,’’ Kachikwu added

In his re­mark, Chair­man, SPE La­gos Sec­tion 61, Mr Temi­tope Oshutuyi, noted that the topic is timely to ad­dress FDP chal­lenges in the oil and gas sec­tor.

``At the end of the ses­sion, we be­lieved it would high­light steps to en­able pro­duc­ing com­pa­nies have their FDP ap­proved on time,” he added.

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