Business

NNPC and Chevron Achieve Major Milestone with Asset Conversion, Set Sights on 165,000 BPD Oil Production

Published by Tope Fakinlede on September 10th, 2024.

NNPC and Chevron Achieve Major Milestone with Asset Conversion, Set Sights on 165,000 BPD Oil Production

The Nigerian National Petroleum Company Limited (NNPC) and Chevron Nigeria Limited have finalized the conversion of five joint venture assets, aligning with the Petroleum Industry Act (PIA) of 2021.

Mr. Bala Wunti, Chief Upstream Investment Officer at NNPC, announced that this conversion is set to significantly enhance crude oil production, with the partners aiming for a target of 165,000 barrels per day by the end of 2024. He highlighted Chevron’s effective operational strategies, which are vital for maintaining network stability and ensuring a consistent domestic gas supply.

This asset conversion marks a transition from the Petroleum Profit Tax regime to the more favorable terms under the PIA. During a recent ceremony, NNPC’s Chief Corporate Communications Officer, Olufemi Soneye, confirmed that the companies signed documents to convert five Oil Mining Leases (OMLs) into four Petroleum Prospecting Licenses (PPLs) and 26 Petroleum Mining Leases (PMLs).

This milestone is crucial for boosting Nigeria’s domestic gas supply and enhancing its global market presence. Under the PIA, existing Oil Prospecting Licenses and OMLs will automatically convert to PPLs and PMLs upon expiration, though companies can also opt for voluntary conversion.

NNPC’s Group CEO, Mele Kyari, praised Chevron for its ongoing partnership and commitment to shallow water oil production. Kyari emphasized NNPC’s dedication to strengthening this collaboration, which aims to create mutual benefits and fortify Nigeria’s position in both domestic and international gas markets.

Chevron’s Director of Deepwater and Production Sharing Contracts, Mrs. Michelle Pflueger, underscored the significance of the conversion for both companies and reaffirmed Chevron’s long-term commitment to the joint venture assets.

NNPC Executive Vice President of Upstream, Mrs. Oritsemeyiwa Eyesan, stressed the strategic benefits of the PIA, noting that this conversion is vital for the successful implementation of the Act. The statement also recognized the Nigerian Upstream Petroleum Regulatory Commission for its crucial role in facilitating the conversion process.