Petroleum Africa
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Friday, August 10, 2007
While the DPR issued the threat, insiders believe that it is empty as if the oil fields are shut down, production will plummet, thereby cutting the government’s cash cow. Currently the petroleum industry contributes about 95% of the nation’s foreign exchange income, 90% of total fiscal revenue, and accounts for about 40% of the GDP.
Government had set a target for gas flare down by 2008 as part of its efforts to stop resource waste and monetize gas through internal utilization and export, warning oil producing companies of hefty penalties to be paid if they did not meet the deadline. Oil firms responded that this was unrealistic for a myriad of reasons including the insecurity of the Niger Delta and poor response to joint venture funding from the government.
Chief Executive Officer, Egbert Imomoh of Afren Energy Resources, who spoke on behalf of operators’ at a recent SPE conference said the facilities and infrastructure required to achieve the flare down objective were critically lacking and the security situation in the Niger Delta added to the constraints in achieving the targeted date.
"It is not realistic," Imomoh emphasized while stressing that government should discuss with all operators and agree on what was realistic and achievable in the face of new challenges.
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