Chief Executive Officer of Cowry Asset Management Limited, Johnson Chukwu, has pinpointed the need for Nigeria to prioritise increasing crude production and tackling insecurity in the Niger Delta to ensure refineries get Feedstock.
During an interview with ARISE NEWS on Tuesday, Chukwu stated that it is critical for the Nigerian government to align the interests of the local residents in the Niger Delta with national economic interests. He stressed, “We should focus on how to increase crude production, fight the insecurity in the Niger Delta, and win the hearts of the residents in that area. The people in that area must feel that the national economic interest is also their interest.”
Speaking against the backdrop of Dangote Refinery’s face-off with Nigerian oil industry regulators, Chukwu expressed concerns about the country’s current crude production levels, noting that in July, average production was just about 1.3 million barrels per day. He explained that at this level, Nigeria’s National Petroleum Company (NNPC) has insufficient crude to meet domestic refinery needs.
“Our NNPC share of crude production, about 1.3 million barrels, is at best 650,000 barrels. With that, the government will not be able to even meet its obligations to the local refineries,” he warned.
He also pointed out that despite the expectation that local refineries like Dangote’s would ease the import burden, the focus should be on improving crude production. “The discussions should be on how we can improve crude production instead of the disputes between the local marketers, Dangote, and NNPC. The reality is that we do not have enough crude,” Chukwu asserted.
Chukwu also highlighted the importance of addressing crude oil pipeline breaches and theft, commending the recent efforts of NNPC in collaborating with military personnel to combat these issues. He suggested that, with significant investments and improved security in the Niger Delta, crude production could return to about 3 million barrels a day within the next one and a half years, though he noted that this timeline is optimistic.
In conclusion, Chukwu underscored the urgency of focusing on increasing crude production and securing the Niger Delta, stating, “We must align the interests of the locals in the Niger Delta area to the national interest.”
NNEOMA UDENSI
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