FG earns N1.7trn oil revenue in 3 years

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By Ediri Ejoh
Nigeria may have earned about N1.68 trillion as revenue from oil between 2015 and 2017. The Department of Petroleum Resources, DPR, in its 2017 Nigerian Oil and Gas Industry Annual Report, stated that the revenue was realised from oil and gas royalty, gas flare penalty, concession rentals and miscellaneous oil revenue.

Specifically the report stated that about N545.06 billion was earned in 2015; N437.35 billion in 2016; while N704.43 billion was earned in 2017

On gas royalty, the country made the sum of N71.75 billion. Out of that, it recorded N22.29 billion in 2015; N16.29 billion in 2016 and N33.17 billion in 2017.

For gas flare penalty, Nigeria was said to have earned a total of N7.69billion within the period under review. A breakdown of the amount shows that N2.59 billion; N2.33 billion; N2.77 billion were earned in 2015, 2016 and 2017, respectively.

The report  also stated that the country recorded a revenue generation of about N900.65 million on concession rentals, which included N201.27 million, N342,.49 million, N356.89 million recorded respectively between 2015 to 2017.

As regards  miscellaneous oil revenue, the country realised a total of N30.23 billion. Specifically, N17.48 billion was generated in 2015; N6.40 billion in 2016 and N6.35 billion in 2017.

The total volume of gas produced last year was 2.94trillion cubic feet, which averages a daily production of 8.05billion standard cubic feet.

The report stated: “The volume of gas produced comprised of 1.73trillion cubic feet associated gas, representing 58.74percent of the gas produced and 1/21trillion cubic feet non-associated gas, representing 41.26percent of the total gas. Also 2.59trillion cubic feet (88.13percent) of the produced gas was utilized while a total of 21.02 billion cubic feet representing 0.7 percent was attributed to gas shrinkage. “The remaining 11.04percent of the produced gas, was flared.”

The report also stated that the average gas utilised in 2017 was 7.09 billion cubic feet. It added that a total of 324.30 billion cubic feet of produced associated gas were attributed to flare during the period in view.

According to the report, the year 2017 experienced a slight increase in gas flare volumes as a proportion of the total volume of gas produced.

It explained, “This increase was due to several factors which include: constant equipment upset/failures in aging facilities, sabotage, high gas/oil ratio in aging wells, funding challenges in executing gas handling projects and other operational challenges experienced by the operators”.

The report further stated that in 2017, a total of 754,265,049 barrels of oil were produced at an estimated average daily production of 2.07million barrels per day.

It noted that there was a 5.6 percent increase over the average production rate for 2016, adding that the total number of fields (producing and shut-in) as at the end of December, 2017 stood at 285 for the 44 oil producing companies. According to the report, the average deferment for 2017 was 725,859 barrels of oil per day.

On the local refining capacity, the report stated: “The dwindling local refinery production amid the rising demand patterns for petroleum products in 2017 meant that most of the market needs for the year were met by product importation from foreign refineries.

NNPC earns $470m from oil, gas export in one month

“The refining gaps further meant that the local economy had limited access to heavy-end refinery products, such as Coke, Asphalt and high pour fuel oil, HPFO, that otherwise could have been locally produced for the value creation in the manufacturing sector had the refineries been running optimally”.

The DPR explained that while crude oil production aggregately peaked at 2.07 million barrels per day during the period in 2017, the total installed capacity of the local refineries remains 446,000 barrels per day. And the need for growth in the refinery sub-sector becomes increasingly urgent, considering that capacity utilisation in the year under review was merely 8.67 per cent,” it said.

It further added: “The availability of petroleum products in Nigeria continues to depend primarily on the importation of such products. The importation of petrol stood at an average of 45.8 million litres per day; posting a decrease of 7.8 per cent from 2016.

“The decrease in the importation volumes which may be attributed to an increase in landing cost among other reasons may have been responsible for the fuel scarcity experienced towards the end of 2017.

“The dwindling local refinery production amid the rising demand patterns for petroleum products in 2017 meant that most of the market needs for the year were met by product importation from foreign refineries.”

Local refinery

The report disclosed that the Port Harcourt Refining and Petrochemical Company produced the lowest at 6,998.94 crude, while Warri Refining and Petrochemical Company and Kaduna refining and petrochemical company produced 14,775.66 and 16,597.23 respectively in 2017.

Source:

https://www.vanguardngr.com/2018/11/fg-earns-n1-7trn-oil-revenue-in-3-years/

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