Nigeria gets seven oil regulations amid N46.16b stolen, missing crude

• Signs new power purchase agreement for 726MW
• Finance minister, NBET seek enabling environment, more investors

Nigeria signed seven new regulations into law, in Abuja, yesterday, in a move to boost metering of all crude oil operations in the upstream segment of the nation’s petroleum industry.

The new regulations signed by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) are: Nigeria Upstream Petroleum Measurement Regulations; Frontier Basins Exploration Fund Administration Regulations; Production Curtailment and Domestic Crude Oil Supply Obligation Regulations; Nigeria Upstream Decommissioning and Abandonment Regulations; Nigeria Upstream Petroleum Unitisation Regulations; Gas Flaring, Venting and Methane Emission (Prevention of Waste and Pollution) Regulations and Significant Crude Oil and Gas Discovery Regulations.

Being a key requirement of the Petroleum Industry Act, the development came at a time Nigeria is battling crude oil theft.

Nigerian Extractive Industry Transparency Initiative (NEITI), at the signing ceremony, said while the country is resorting to borrowing, over $46.16 billion of oil remains stolen or unaccounted for in recent years.

Loopholes in regulations, including lack of metering of oil output, has been blamed for the development, over the years, even as the country has no exact figure on crude oil output and other industry data.

NUPRC Chief Executive, Gbenga Komolafe, said the regulations would close metering gap in upstream petroleum operations; encourage accelerated meter roll out in upstream operations; encourage development of independent and competitive meters used in the upstream; attract private investment in provision of metering services and ensure accurate measurement of petroleum as a basis for the calculation of petroleum revenue accruable to the government.

The regulations would also provide general rules for curtailment and utilisation of petroleum in relation to export and domestic crude oil supply obligation.

Executive Secretary of NEITI, Dr. Ogbonnaya Orji, said from 2009 to 2020, Nigeria lost 619.7 million barrels of crude oil, totalling about $46.16 billion.

While the country is borrowing to finance infrastructural projects, the $46.16 billion is higher than the current external debt of Nigeria, which stands at about $41.8 billion.

Orji said the development was only tracked from eight companies that were willing to volunteer data.

“There is no nation that I am aware of that can survive with this kind of arrangement,” Orji said.

Meanwhile, Nigerian Bulk Electricity Trading (NBET) Plc, in Abuja, yesterday, signed a 20-year 726 megawatts Power Purchase Agreement (PPA) to improve electricity supply and attract investment.

The deal was signed with Transcorp Plc.

Minister of Finance, Budget and National Planning, Zainab Ahmed, said government will remain committed to improving environment for doing business in the power sector.

Also speaking, Managing Director of NBET, Dr. Nnaemeka Ewelukwa, said there was need for more investment in the power sector, adding that the new PPA would encourage long-term investment in the country.

He said Transcorp has track record in the Nigerian power sector, stressing that the deal would enable the company to make capital investment that would see its capacity improve sufficiently.

Chairman of Transafam Power Limited, Stanley Lawson, disclosed that Transcorp spent over €50 million on the plant and that the company plans to invest another €150 million in the near future.

Lawson described the agreement as a key financial viability component of the plant.