Funds, competence necessary in Nigeria’s bidding round- ND Western

 

 

UGO AMADI

 

An indigenous oil and gas company, ND Western, has disclosed why financial muscle, technical competence and historical performance form the major considerations in Nigeria’s bidding round.

 

Eberechukwu Oji, the Managing Director of ND Western, disclosed this at the just-concluded Petroleum Technology Conference (OTC), in Houston, Texas, U.S.

 

IT WOULD BE RECALEED  the Minister of State for Petroleum Resources (Oil), Sen. Heineken Lokpobiri, had said the bid would be based on major criteria, especially financial muscle and technical competence.

 

Oji said: “The government has to run the bid round in such a way that creates a level playing field for everyone.

 

“That is the way it is done internationally so that we do not end up giving the blocs to non-professionals.

 

“In the past, some people who were not professionals got the blocs but could not develop them.

 

“They ended up not developing the assets for a very long time and then defeat the government’s efforts, targeted at increasing reserves and production capacity.

 

“So, let the right people, who will make the right investments get the assets so that they can bring them to production. It is not about the highest bidder.

 

“You will have a set of criteria. Money is important. Technical competence will carry a certain weight.”

 

He said that ND Western would continue to flood the domestic market with gas for different purposes, especially power generation.

 

Oji, who decried the huge indebtedness to gas producers, said: “We run the Utorogu gas plant, which is one of the biggest gas plants in Nigeria.

 

“The plant is running and our processing capacity has reached a 600 million scf.

 

“We are one of the two companies that are major suppliers to the West African Gas Pipeline. ND Western and Chevron provide gas to Benin, Togo and Ghana.

 

“We are also looking at the possibility of increasing investment to extend supply to other nations. We hope that the gas from Water River will be piped into our existing facility.

 

“We have undertaken the Ugeli East gas plant replacement project to process not just methane gas that goes into the pipeline but also Natural Gas Liquids (NGLs), Liquefied Natural Gas (LNG) and Liquefied Petroleum Gas (LPG).

 

“This is important to enhance domestic supply. If the generating companies and the transmission companies do not receive enough, they will not have enough to pay the upstream suppliers of gas.

 

“The upstream production of gas is a very expensive business and it is priced in dollars.

 

“As the dollar exchange rate is weighing against the Naira, it means that the cost of production in Naira term continues to escalate.