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NNPC claims crashing production cost from $78 in 2015 to $23/barrel now

… saves minimum of $3billion per annum

Barely one week after the Minister of State for Petroleum Resources announced that cost of oil production is getting out of hand and Nigeria may dump the industry if it persists, the Nigerian National Petroleum Corporation (NNPC) said it has driven down the cost of crude oil production from $78 dollars per barrel in August 2015 to $23 per barrel this year.

The recovery, according to the corporation represents 70.5 per cen.

This was revealed by the Group General Manager of National Petroleum Investment Management Services (NAPIMS), a unit of NNPC, Dafe Sejebor, in a statement during the inauguration of the Anti-Corruption Committee of the agency in Abuja.

He said the unit had been saving a minimum of $3billion per annum for the nation.

In his analysis, Sejebor said NAPIMS arrived at the figure after looking at the difference between the $78 and $23 which represent the old and new cost of production in relation to the present daily average production in the country.

He said “If you knock down your cost of production from $78 per barrel to $23, take the difference and multiply by the average daily production, you will discover that we are saving a minimum of $3billion in the upstream for both Production Sharing Contracts (PSCs) and Joint Ventures (JVs)”.

Sejebor noted that NAPIMS target is to bring the cost of production to between $17 and $19 for onshore and offshore production respectively and commended the Federal Government for its support to the NNPC management in tackling challenges in the petroleum sector.