The Nigerian National Petroleum Company (NNPC) Limited and its Joint Venture (JV) partner, Chevron Nigeria Ltd (CNL) is targeting an oil production rate of 165,000 barrels per day (bpd) by December 2024.
The NNPC and CNL, on Monday, concluded the conversion of five of its joint venture assets into the PIA terms, in line with the Petroleum Industry Act (PIA) 2021 provisions of transiting assets from the Petroleum Profit Tax (PPT) into PIA terms.
The NNPC, which made this known said that under the new PIA regime, all existing Oil Prospecting Licences (OPLs) and Oil Mining Leases (OMLs) would be automatically converted to Petroleum Prospecting Licences (PPLs) and Petroleum Mining Leases (PMLs) upon their expiration.
“Nonetheless, an option of voluntary conversion is provided for holders of OPLs and OMLs (Operator, Licensees or Lessees) under the erstwhile Petroleum Profit Tax (PPT) regime. The PIA terms are generally perceived as more investor-friendly, compared to the erstwhile PPTA terms,” the national oil firm’s spokesperson, Olufemi Soneye, noted in a statement.
During a ceremony held at the NNPC Towers on Monday, the two partners signed documents on the conversion of five OMLs into four PPLs and 26 PMLs, in line with the new PIA terms, marking a significant step towards increasing domestic gas supply and expanding global market presence.
Speaking at the occasion, group CEO NNPC Ltd, Mele Kyari, described CNL as one of the most reliable partners for the NNPC Ltd. “Over the years, Chevron has been a partner of choice that has not contemplated completely divesting/exiting (oil production in) the shallow water and we are proud of them,” he added.
Kyari assured CNL that NNPC Ltd would sustain its partnership with the JV partner so as to create more value for both parties and expand Nigeria’s footprints in the domestic and export gas markets.
He commended the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) for its exemplary role in midwifing the conversion.
In his remarks, NNPC Ltd’s chief upstream investment officer, Bala Wunti, noted that the assets conversion is expected to significantly boost crude oil production, with the two partners focusing on attaining the 165,000 barrels of oil per day (bpd) production target by year-end 2024.
He emphasised the continued importance of CNL’s operational philosophy in maintaining network stability and facilitating gas supply especially to the domestic market.
The director, Deepwater and Production Sharing Contract (PSC) of CNL, Michelle Pflueger who stressed the significance of the conversion for both companies, affirmed CNL’s long-standing commitment to the assets.
Also speaking, NNPC Ltd’s executive vice president, Upstream, Oritsemeyiwa Eyesan, highlighted the advantages of the PIA terms over the previous PPT terms, noting that the conversion was a strategic move towards the successful implementation of the PIA.
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