Tarka: Growing Reserves Necessary to Sustain Nigeria’s Voice at OPEC

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The President of the Nigeria Association of Petroleum Explorationists, Mr. Alex Nachi Tarka, who fielded questions recently ahead of the association’s ongoing international conference and exhibition, stressed the need for Nigeria to continue adding to its oil reserve in order to remain relevant at the Organisation of Petroleum Exporting Countries. Tarka, among other issues also gave update on the exploration activities going on at the Benue trough. Peter Uzoho presents the excerpts:

NAPE has been in existence for 45 years as a major stakeholder in the Nigerian oil and gas industry. What can you say are the greatest achievements recorded by the association after 45 years?

I want to start by saying that key government policies since NAPE’s inception are mostly taken from our communiques. And one of the major ones that have so much impacted the industry is the marginal field that is operating currently and giving jobs to so many Nigerians and adding value to the economy of this nation. It was part of a communique from NAPE workshop. Also the Deepwater Act. When you hear of Deepwater, that is where the biggest of reserves are being found globally. All these are issues coming out of NAPE workshop. So NAPE is positioned in such a way that enables us to record key achievements. As at today, we have our members as marginal field operators. Refineries (private refineries) are being set up today by our members. We have so many things to showcase, from the marginal fields which is dominated by our members to Deepwater Act to refineries. Our members are the first to have private refineries running. Some are just about to be commissioned as we speak and they are going to meet a lot of needs for the nation and the states they are located.

How much of technology has been deployed in the exploration of the frontier basin and what are the results? Again, what is the estimated oil reserve in the Gombe basin and when will the commercial production start?

Let me make a correction before I go into answering the questions. We have nothing like the Gombe basin. We don’t want to duplicate the issues of Niger Delta in the frontier. From Gombe State to Bauchi to Benue to Plateau to Taraba to Adamawa down to Kogi and Anambra, geologically, (because we are reporting for the energy industry), we call it the Benue trough. We don’t want to create undue tension amongst states. So there is nothing in geology like the Gombe basin. The operation that is going on in that axis is drilling operation within the Kolmani River in Benue trough.
Besides that, I want you to also know that the operation going on has a lot of technology deployed, highly advanced technologies. As a corporation, NNPC does not shy away from technology testing -whatever is developed out there, and that is the essence of attending international conferences. We are exposed to international conferences. A lot of our staff have to go out there to interact with international professionals. A lot of research is going on and the corporation takes on the research, being the national oil company, to test. So it is worthwhile that we continue to test the technologies across the basin. So for the drilling campaign going on currently, a lot of technologies is being deployed: fibre-optic machines, best of its kind across the world are being deployed. Things like surface geochemistry, so many advanced technologies. And then all that, plus seismic, the best of seismic, all are integrated, both conventional and non-conventional. It’s for each of the technologies to be able to tell you and reconfirm and de-risk as much as possible prior to even moving a rig.

The volumes of what have been seen, like the GMD (Group Managing Director of NNPC) said even yesterday (last week Monday) in our discussion, is already in the public domain. It is a commercial discovery. We don’t need to bother so much about volumes at this stage because exploration is still ongoing. The second well is being drilled. So the important thing for this meeting is that NNPC’s geoscientists which I am a part, have made a commercial discovery in the Benue trough and the testing results have shown that it is commercial. The minister (of state for petroleum) has made announcement since February when I was at NIPS (Nigerian International Petroleum Summit) in Abuja. So the commerciality of the Benue trough is no longer in doubt. That’s why drilling is going to be sustained because NNPC is a responsible operating arm of government that government depends on to sustain the economy of the nation. So exploration campaign will be sustained and until it gets to the level of development, nobody is in the position to start discussing production. Reserves need to be discovered to be in commercial quantity. So that should give us comfort as reporters that for the first time in a long while we now have a commercial discovery in the frontier of Nigeria within the Benue trough.

Is it possible for other oil companies to replicate the kind of technological innovation currently at play at OML58, where, from oil production, a particular field is switched onto gas production?

This question interests me so much because I, the sitting President of NAPE, served in OML58 as an NYSC member close to 30 years ago when Total was still Elf. I worked at Obagi, I worked at Ibewa. Ibewa is purely gas. But the beauty about Obagi is that so many wells have been drilled in Obagi and the oil industry is purely an association of oil and gas. The oil in Obagi wouldn’t have been able to take so many years to be produced if it was not merely gas-lifted. The wells in that fields, so many are being gas-lifted, some are water-lifted. So, you have a situation where you have a lot of Associated Gas in OML58. So, Obagi proper is oil and gas. Ibewa next door is just gas province. So when you produce that oil after it is assisted through gas lifting and all that needs to go in to optimise your production, you discover that you have a lot of gas opportunities, especially now that gas has become of so much value. So OML58 entirely beside Ibewa, next door to Obagi, the whole of that place has a lot to do with huge gas volumes currently. So it makes it easy to switch, especially as we talk so much about renewables and the environmental impacts. So, Total with NNPC JV partnership will continue to have a lot of funds because of the huge gas volumes within that asset. So, it is possible to replicate that in so many places. We are doing it within NPDC currently where so much production is taking place in Oredo OML111, where I also started my career after Youth Service. We have a-100million scuf of gas plant which is just about to be commissioned after closed to 30 years of oil production, because I was one of the wellside geologists that completed some of the first wells in Oredo fields when the Float Station came on board. So, that arrangement can be duplicated in so many areas and so many fields within the Niger Delta, both onshore and offshore. It’s a fantastic business for the nation and we are excited about it as NAPE, being a part of some of these achievements.

Now that the government has declared 2020 as the Year of Gas, how prepared are NAPE members to take advantage of the opportunities in that declaration in terms of exploration and technology?

The question on gas exploration, looking at the year 2020 as the Year of Gas, I was at that summit in Abuja. I was one of the panelists at that summit where that announcement was made in February. I want to state that right from exploration commencement in Nigeria, beside the fact that gas was not so much of importance because of the economics around gas, globally by then. Almost every well drilled in Niger Delta like I said earlier, is usually oil and Associated Gas. It is that gas and water within a well that help with the lifting of that crude oil in the surface. Sometimes, because of the low cost of gas, we had to be using the gas or even gas injection to do all sort of things. So, so many wells in Niger Delta, in the course of drilling, right from inception, were just gas wells. We have gas province within the Niger Delta. We have almost every operator having some fields that are just gas and in those days, once you drill into such wells, you just suspend those wells because of the low value of gas. And then, currently, the infrastructure is being set up in such a way that it is so important to now go back and reopen those wells. So we have projects that are called NAG projects -Non-Associated Gas, which target the gas that we have already discovered. We don’t need so much of exploration for gas. There is already so much gas from hundreds and thousands of wells that have been drilled. So we have projects that are targeted at using the Non-Associated Gas which we call NAG and we have projects that are AG projects which are going to be merely targeting using the Associated Gas that have been there in the normal oil wells. So, in as much as there will be room to explore, we have so much gas volumes. All we need now is infrastructure just like you have the AKK, to carry those gas volumes across the country to help industrialisation. Our corporate members that have been in this business, there is none that lack gas as at today. We have enough. Until we exhaust, we don’t need to begin to explore for it specifically.

The deployment of the first unmanned platform by Norwegian energy giant, Equinor, has been projected to reduce project cost globally, how are Nigeria stakeholders preparing for this inevitable future, looking from exploration activities through services even to research centres?

The unmanned platform, a lot of our platforms in Nigeria are manned. The Equinor experience is a wonderful one. The advancement and testing of technology, that will take some time before it will have a serious impact on us. Research and development will be sustained here. What we do now on our part is to have these systems that you sit in the comfort of your house and see what is happening in the fields. Even on my phone, at times you can check what is going on in the field. The Kolmani operation that is going on in Benue trough, there are systems in Abuja office that you can sit in the comfort of your office and see everything going on. So, that also helps to show the advancement of technology and the benefit. However, research and development will be sustained here among our members and we know that our situation is peculiar -unemployment challenges. So, even if we have such unmanned platforms, we will not be in a hurry to start deploying them because we have people working on our platforms. They are set up to accommodate the human beings to help reduce unemployment in our own situation. We will sustain the research but we will not jump at just copying what the international companies are doing. We have to address situations here depending on the peculiar situation of our nation.

Looking at the Benue trough and the kind of cost being incured in exploration there, shoudn’t the same kind of funds be deployed towards solid minerals development especially now that the world is looking at other resources as against oil?

The funds being used to do exploration in the Benue trough and the whole frontier basins is special government funding. It does not take away any budget from the Federal Ministry of Solid Minerals. We have Federal Ministry of Mines and Steel Development. We still work with them. I have held meetings with the minister of state (for mines and steel development) this year. They are doing aggressive work based on the budget available to them: deploying the best technologies, trying to help illegal miners to come together to form cooperatives to benefit from the funding specially set aside for solid mineral development. The budget for exploration campaign in the Benue trough and other basins is different from the budget and finance of solid mineral development because they are different ministries. As a responsible nation being an OPEC member like Nigeria, we need to continue to add reserves because as population grows, what we are talking here will continue to be needed globally. The energy demand will continue to increase as population increases. So, we are going to sustain what we are doing both in Benue trough and across the basins to add to the reserve of the nation. It is the reserves of any oil producing nation that gives such a nation a voice at OPEC. So, we will allow solid minerals to do their job. We are part of them. We have a lot of our members that are into solid minerals especially our academic groups and the business men that are our members. And we have so many of our members in the oil and gas. Like I have said, they are different ministries with budgets to sufficiently run the activities of their separate ministries.