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Chad basin oil exploration: Way forward

By: dayan (M) |Time : September 16, 2016, 10:51:23 PM


The renewed effort for search of oil in the Chad Basin by the Nigerian National Petroleum Corporation (NNPC) has generated excitement of the populace as this is viewed as final attempt to find oil in this region. The earlier exploration campaigns of the then Direct Exploratory Services (DES), later renamed Frontier Exploratory Services (FES) of the NNPC - an in-house outfit of the corporation - lasted some 14 years spanning from 1986 and ending around 2000. During the period some 23 exploratory wells were drilled within Borno State - largely in the Chad Basin Sedimentary Rocks.
The speed of performance of FES was generally assessed to be sluggish compared to, say, neighboring Chad Republic which drilled some 43 exploratory wells before oil was found within about the same time scale. Performance efficiency of the then management of the FES was accordingly seen to be slow and now the expected new management of the body must deploy better skills and indeed approach for speedy realization of the government objective of finding oil. This is vital since drilling rig may have to be hired similar to the previous efforts. Drilling costs is high and with limited national resources, efficiency becomes vital in all respects. The high level cooperation now existing between Nigeria and Chad Republic can be exploited to support the exploratory exercise. Chad Republic must have huge data on exploration within the basin that should minimize risk of dry wells. This, in addition to the seismic data to be acquired directly by NNPC will lead to successful discovery of the much sought oil in this region. This approach will significantly reduce exploratory costs since cost savings is cardinal concern of the government.
While plans are being expectedly drafted carefully by NNPC, it is considered worthwhile to remind the body that errors of those earlier years must not be repeated to achieve speedy success. These lapses were largely seen not from technical perspective but mainly on overall management of the enterprise and indeed related costs that can still make this new endeavor very expensive. The earlier effort was based on 2D seismic survey, which is known to be much less accurate especially because the vital depth prediction - thus 3D - was not available. Also, the earlier data interpretation was said to be based on experience in the Niger Delta, which is different kind of reservoir to the Chad Basin. Happily, it is now understood that the NNPC has been acquiring 3D seismic data preparatory to commencement of drilling.
Major failures that were noted during the earlier search included non-alignment of sequential development of access roads, base camps and the most important drilling platforms. Expensive down times of hired rigs were observed to be common and thus making the entire campaign not only expensive but slow. Exploratory sequence must be fully planned and indeed strictly monitored to ensure efficient management. It is known that the Chadians drilled 43 wells before oil discovery; NNPC can therefore leverage on their experience in the Chad Basin as well as take advantage of the huge volume of data acquired from the recent and previous campaigns to strike oil much faster and more economically. Niger Republic has also successfully explored and realized oil and even built modest refinery thereby not only meeting its domestic demand but getting income on exports. The wells in both countries are within the same geological formation and adjacent to the borders of Nigeria. It is accordingly predictable that getting oil on Nigerian soil is only a matter of commitment.
It was speculated in the course of the previous attempts within the Chad Basin that an exploratory well only 5 KM away from Baga town, called Kadaru-A, could indeed contain oil; the drilling rig, with depth capacity of some 300,000m - was said to be unable to drill to the depth required to strike oil. A re-visit to the area with the right capacity rig could as well lead to probable early success. After-all, gas flared for some 2 hours in one of the exploratory wells signifying likely-hood of oil presence. Chad Republic has now lucrative oil wells mostly within the greater Chad Basin.
It is noted that when FES packed out of Chad Basin, NNPC had thought through the idea of minimizing Federal Government financial exposure in the exploratory effort. As part of the ‘downstream obligation’ for the award of off-shore blocks, the major oil companies were required to drill exploratory wells in the Chad Basin and Benue Trough. Initial plans were set in place by the oil companies and indeed some exploratory efforts took place within the Benue Trough but these did not last long. It is viewed that this arrangement should be revived to support the NNPC in saving costs and indeed hastening the realization of oil presence in the areas.  After-all, the major oil companies are experts in oil exploration even in new frontiers around the world. While NNDC has, with whole honesty, won some blocks in Chad Basin and Benue Trough, may eventually be unable to source huge funds for this highly expensive venture of oil exploration. If they indeed succeed in getting funds, multiple efforts by stakeholders can eventually speed up the process of achieving desired result.
It is suggestive that as preliminary plans for the renewed effort are being packaged by the NNPC, consideration should be given for the development of a suitable refinery in Maiduguri, the Borno State Capital, in the event of discovery of oil. Advantages of the right capacity refinery in this location are certainly many. Currently, the Federal Government expends substantial funds for ‘bridging’ of refined oil to several areas of the country. A refinery in Maiduguri will reduce the heavy costs being incurred and further boost businesses in this area of the country. Several states such as Yobe, Gombe, Adamawa, Bauchi, Taraba, JIgawa, Borno and Kano can cheaply receive fuel supply from the refinery. Huge bridging costs by government will thus be saved. The refinery can, under strategic national planning, provide needed back-up when Kaduna refinery, for example, goes down for maintenance repairs. Cost benefit analysis will clearly show recovery of investment in reasonably short period. Refined oil can also become available for export to some of the neighboring land-locked countries should the quantity of oil be found to be huge.
When efforts are put in place for strategic growth of the nation, the much desired improvement of the living condition of the citizen will be realized. The government, in its desire to pursue the change mantra, will indeed add successful exploration of oil in the Chad Basin and building of a refinery in the area, in the overwhelming list of its achievements.

Engr Ali Goni
[email protected]

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Re: Chad basin oil exploration: Way forward

By: dayan (M) |Time : September 16, 2016, 10:54:42 PM
Quote
The high level cooperation now existing between Nigeria and Chad Republic can be exploited to support the exploratory exercise. Chad Republic must have huge data on exploration within the basin that should minimize risk of dry wells. This, in addition to the seismic data to be acquired directly by NNPC will lead to successful discovery of the much sought oil in this region. This approach will significantly reduce exploratory costs since cost savings is cardinal concern of the government. 

Smart suggestion -this will reduce the incidence of dry wells, and we cannot afford dry wells in this dry economy.
Some every cost cutting measures should be adopted.

Re: Chad basin oil exploration: Way forward

By: alagbe003 (M) |Time : September 17, 2016, 08:09:34 AM
we have been talking of diversification and value addition. If we want to work on oil exploration we should make our refinery functional. we cannot continue to export crude oil only to bring in the refined product. Enough is enough

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