FG to double oil, gas reserves with fresh exploration

File: Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri

The Federal Government is set to double Nigeria’s oil and gas reserves through intensified exploration, particularly in deepwater and other underexplored basins, the Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, has said.

Lokpobiri said the country has substantial hydrocarbon potential that remains untapped, stressing that sustained investment in exploration is necessary to discover new resources and maintain production in the coming years.

He spoke on Monday at the opening of the 44th Annual International Conference and Exhibition of the Nigerian Association of Petroleum Explorationists in Lagos, where he urged oil and gas operators to intensify drilling campaigns, strengthen indigenous technical capacity and invest in new discoveries.

According to the minister, Nigeria can significantly expand its reserves through deliberate exploration programmes, particularly in deepwater areas with considerable untapped potential.

He warned that the country cannot continue to depend on discoveries made several decades ago to sustain future production, noting that exploration activities had declined over the years before the current administration began efforts to revive upstream operations.

Lokpobiri disclosed that the number of active drilling rigs had increased from about 10 when he assumed office in August 2023 to more than 50 currently, while oil production had risen from about one million barrels per day, including condensates, to more than 1.8 million barrels daily.

“When we came into office, active rigs were about 10. Today, from what I heard, active rigs in the country are over 50. They are drilling. There are continuous drilling campaigns going on by different operators in the industry. If you don’t drill today, there will be nothing to unlock tomorrow,” he stated.

The minister said the increased drilling activities are laying the foundation for future production, adding that exploration undertaken today would determine the country’s ability to sustain oil and gas output in the coming years.

“The foundation we are laying is to ensure that we take steps towards achieving sustainable production of oil and gas in the country,” he mentioned.

Lokpobiri called for greater investment in frontier exploration, noting that the Petroleum Industry Act had provided a dedicated fund for the purpose.

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He expressed confidence that sustained exploration could significantly expand Nigeria’s reserves and unlock additional hydrocarbon resources.

He said, “We need to do a lot of frontier exploration. That is why the PIA itself has set aside a fund for frontier exploration. If we do that, I believe that in the next few years, we will come back here with profound results. I believe our reserves, in my opinion, should more than double. Our deepwater space has a lot more potential than what you and I can imagine.”

However, the minister cautioned against equating the size of the country’s reserves with economic prosperity, citing Venezuela’s more than 300 billion barrels of oil reserves as an example of how enormous resource endowments do not automatically translate into wealth.

He stressed that reserves will only deliver economic value when the resources are developed, produced and sold in the market.

“Reserve figures have no value unless we truly take appropriate steps to unlock these barrels and get them to the market. That is the only way we can get value,” he said.

Lokpobiri also highlighted the importance of the petroleum industry to Nigeria’s foreign exchange position, disclosing that about 85 per cent of the country’s foreign reserves, estimated at $56bn, came from the oil and gas sector.

In her keynote address, the Special Adviser to the President on Energy, Olu Verheijen, said Nigeria must ensure that increased oil and gas production translated into stronger industrial capacity, employment opportunities and improved economic conditions for citizens.

Verheijen noted that the country’s challenge is no longer limited to identifying hydrocarbon resources but also creating the right investment conditions to develop them.

She cited the Ima gas field, where a discovery made more than 50 years ago only recently reached a final investment decision, as an example of how unfavourable investment conditions could delay the development of valuable resources.