DPR to sanction operators for non-compliance to production data
The NPMS, a web-based oil, and gas production accounting, and monitoring platform were established by the federal government in 2016, for proper book-keeping amid arguments that the country did not know the quantity of oil and gas is produced, resulting in discrepancies in receipts.
The industry regulator equally warned that henceforth, no company will operate if they are not on the NPMS platform, adding that compliance with the submission of the Maximum Efficient Rate (MER) test will be enforced, as no operator is expected to produce from any well without conducting the test.
The MER test is used to determine the optimal rate a given well can be explored, as there are about 2,616 wells producing in the country.
According to the Acting Director, DPR, Ahmed Shakur, the government has spent a lot of resources establishing the platform, noting that despite these efforts, some operators are still not complying with NPMS.
Shakur, who was represented by the Assistant Director, Resources Management Branch Upstream, Akpomudjere Okiemute, at a sensitisation workshop on NPMS in Lagos, added: “We have observed over the years that some operators are yet to comply fully with data submission via the NPMS portal in contravention of the provisions of sections 43 and 52 of the Petroleum (Drilling and Production) Regulations 1969 as amended.
“We have asked you to give us two compliance officers from your organisations that would be held responsible because there are sanctions underway. We have found that very few companies are green on this platform while others are completely red. It is our hope that after this sensitisation, we will get all the operators to comply with this directive,” he said.
Shakur explained that the purpose of the engagement with the operators was to ensure full compliance to production and export data upload into the platform, while also deepening stakeholders understanding of the operations and relevance of NPMS to the nation.
He said NPMS’ key objectives are to provide an online platform to effectively monitor national crude oil to gas production and exports; and provide a system for acquisition of production data from oil and gas facilities in Nigeria, to ensure timely and accurate reporting of production figures and export data. It also aims to improve the consistency and quality of its database; facilitate seamless transfers of oil and gas data to the National Data Repository and monitor production and export activities.
He highlighted some of the steps taken by the Department to ensure full compliance to NPMS data submission as setting up a compliance team with the task to drive, monitor and ensure full compliance with data submission via the platform. It also tied the NPMS data submission compliance to some of its regulatory processes such as the issuance of export permits, technical allowable and other statutory approvals and permits.
On his part, DPR’s Manager, Production and Surveillance, Upstream, Victor Georgeson, explained that NPMS has taken effect and the meeting was to ensure that operators understand the importance of the portal to the government.
“As a country producing oil and gas, we should be able to know at any given time how much oil and gas we have. How much of it we have and we have produced and how much is being exported. Over the years, we have been doing this manually and there are loopholes and you will agree with me that will not be effective, but the new DPR today is emphasizing on effectiveness and accountability. We are also going digital and what you are seeing is like a kind of paradigm shift to serve this country very well”, he added.