The Department of Petroleum Resources (DPR) has issued a stern warning to penalise erring oil firms that fail to report their daily production activities on the National Production Monitoring System (NPMS) platform.
The disclosure was made known by Akpomudjere Okiemute, Assistant Director, Management Branch of DPR Upstream, who represented Ahmed Shakur, the Acting Director of DPR, during a sensitization workshop on NPMS held on Thursday, in Lagos.
Further Details: The Federal Government agency revealed that the move was a quest to have a comprehensive and real-time reporting of the daily oil output by oil and gas firms operating in the country. DPR has also revealed it would ensure full compliance to its directive that mandates the production and uploading of data into NPMS’s platform by the oil and gas-producing firms.
According to the Director, the Federal Government had spent huge resources in establishing the platform, noting that some of the operators were not complying with data submission directives into the NPMS.
“We have observed over the years that some operators are yet to comply fully with data submission via the NPMS portal in contravention of the provisions of sections 43 and 52 of the Petroleum (Drilling and Production) Regulations 1969 as amended.
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“We have asked you to give us two compliance officers from your organisations that would be held responsible because there are sanctions underway. We have found that very few companies are green on this platform while others are completely red. It is our hope that after this sensitisation, we will get all the operators to comply with this directive.”
The Federal Government had earlier sued some oil and gas-producing companies before the Federal High Court in Abuja over non-transparency in the reports of their daily production activities, as well as the case of under-remittance of taxes to private treasuries.
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The legal battle is a statement from the government to ensure the utmost compliance in data submission to the platform.
License withdrawals: The industry regulator further stated that with about 2,616 oil wells which accounts for the nation’s daily oil production, strict enforcement of the compliance shall be applied with Maximum Efficient Rate (MER) test, as no operator will produce from any well without conducting the test.
Similarly, any operator who defaults the new directive, the department reiterates, will cease operation within the wells across the country.
A look into NPMS: The NPMS is a web-based oil and gas production, accounting and monitoring platform, established by the Federal Government in 2016 with the main objectives to:
- provide an online platform that will effectively monitor national crude oil and gas production and export data;
- facilitate a seamless transfer of oil and gas data to the National Data Repository;
- monitor production and export activities; and
- provide a system for the acquisition of production data from oil and gas facilities in Nigeria.
This platform was initiated amidst the arguments that Nigeria does not know the daily quantity of oil and gas produced, which has in recent times resulted in receipts discrepancies.
The bottomline: Over the years, the submission of oil and gas production activities has always been done through the crude method of manual computations which are believed to breed loopholes and ineffectiveness.
This move by DPR to ensure strict compliance with the platform for effective monitoring and accountability seems more a paradigm shift to serve the nation well with transparency in oil production.