Digitalisation: key to reducing crude oil production cost — Derefaka

Digitalisation is key to reducing the Unit Operating Cost (UOC) of producing crude oil in Nigeria to $10 per barrel by December 2021, according to a technical adviser to the Minister of State for Petroleum Resources.

Mr Justice Derefaka, Technical Adviser, Gas Business and Policy Implementation to the Minister, made the assertion on Thursday at an Exploration and Production (E&P) Industry Cost Reduction Webinar.

It had as its theme: “Building Digital Competencies To Improve Asset Management Efficiency In The Nigerian Oil And Gas Sector“.

Derefaka said, “Now more than ever, oil and gas organisations are using technology to drive down production costs to improve margins as they fight prolonged drops in oil prices.

“The driving objective of this webinar is to discuss the imperatives for E&P companies in the Nigerian oil and gas sector to achieve operational excellence in asset management, toward realising a UOC of $10/bbl by 2021.

“One of the main drivers for the achievement of this initiative is digitalisation.”

According to him, apart from investing in digitalisation and modern technology, oil and gas companies need to train their workforce periodically to harness its benefit.

He said, ”Investment in technology and workforce capacity and competence development are essential to surviving current market conditions.

“The key challenge to a digital oil and gas company that would successfully transform through technology and emerge stronger from the crisis appears to be a competency gap.

“Presently, a significant share of companies do not have the competencies necessary to realise the technology’s investment value.”

Derefaka said the Minister of State for Petroleum Resources, Chief Timipre Sylva, was committed to reducing the UOC of producing crude oil which was still over $20.

He said that the Federal Government was also targeting production of three million barrels per day, which could be achieved by digitalisation and deployment of modern technology by oil and gas companies.

ADITOP Hails NNPC’s Downstream Strides

Agroup of petroleum tanker owners in Nigeria under the auspices of the Association of Distributors and Transporters of Petroleum Products (ADITOP) has commended the Nigerian National Petroleum Corporation (NNPC) for its unrelenting efforts to bring sanity into the downstream sector of the oil industry Speaking during a visit to the NNPC Towers Abuja, the National President of ADITOP, Alhaji Lawal Mohammed, expressed delight at the achievements of the Corporation under the leadership of Mallam Mele Kyari, especially in the area of stakeholder engagement. Group Managing Director of the NNPC, Mallam Mele Kyari (Right) with the National President of ADITOP, Alhaji Lawal Mohammed.

“This singular action of meeting with us defines you as a leader with limitless leadership humility and untiring capacity for encouraging the concept of stakeholder management and eagerness to carry us along in every public policy engagement of the NNPC concerning the

oil and gas value chain,” Mohammed stated.

He pledged the group’s support for NNPC stressing that they were ready to place their trucks and retail outlets at the disposal of the Corporation for any pilot programme and investment initiative.

While welcoming the ADITOP leadership to the NNPC Towers, Mallam Kyari pledged to work with the petroleum products distributors to sustain the prevailing sanity in the downstream sector.