Neconde Energy Limited, the exploration and production subsidiary of the Obijackson Group, and operator of Oil Mining Lease (OML) 42, has unveiled a new strategy to combat oil theft in a bid to increase its crude oil production by 35 percent.
The initiative according to its Managing Director and Chief Executive Officer (CEO) Mr. Frank Edozie, will leap its production on an incremental basis from the current 15,000 barrels per day (bpd) to 40,000 bpd in September and 60,000 bpd by year end.
Edozie explained that the unreliable nature of the Trans Forcados Pipeline (TFP) which has been under series of constant attacks by militants remained a major hindrance to the oil production growth of the company, hence the move to device a new strategy.
According to him, the new initiative will see the oil firm transport crude oil produced through barges to oil export terminal, rather than use the traditional pipeline system which has proved to be unreliable of late, causing huge loss of revenue to the company due series of shut down.
The Neconde boss explained that the long term goal of the firm was to be independent of the TFP, which was shut down for over one year and recently re-opened in June this year.
On the other hand, he said there was dispute between Neconde and its operating partner, Nigerian Petroleum Development Company, the upstream arm of Nigerian National Petroleum Corporation (NNPC) over operatorship rights of OML 42,adding that between 13th February and June this year, no barrel of oil was produced at Batan, one of the four oil fields under OML 42.
Edozie said Neconde bought OML 42 with the hindsight that production will get better, stating that before it took over the assets from Shell Petroleum Development Corporation (SPDC), Agip, Elf joint venture who were the original owners of the asset, the four fields were producing about 250,000 bpd.
‘‘Upon takeover of OML 42 in 2012, our projection was to produce 100,000 bpd. But unfortunately that was not the case, due to a lot of challenges we had to contend with,’’ he said.
He painfully disclosed that Neconde has not been able to realize any proceed from the asset, adding that the impact of not producing is that there would be no resources to pay back loans.
On debt servicing, he said the situation remained worrisome as 9 consortiums of banks where loans running into several millions of dollars were sourced were yet to be paid even as every proceed from the assets goes to the banks.
Speaking on relationship with its host communities, he said such as being cordial with the company playing its part in ensuring that it meets it part of Corporate Social Responsibility (CSR) which included the training of host community members in the art of fire fighting and subsequently engaging them as workers to carry out the function they have been trained on.
“All our firemen have gone on training conducted by the Federal Fire Service with all our firemen in all the locations where we operate being community based. We train them and bring them back. We equally have other beneficial arrangements with the communities where we operate,”.