23 Feb 2021

FG to reactivate moribund oil, gas support facilities nationwide – DPR

The Federal Government, Monday, announced plans to reactivate all moribund and dormant oil and gas support facilities nationwide. This, according to a statement by the DPR in Abuja, was part of efforts to boost Nigeria’s production capacity both in the upstream and downstream petroleum industry and create employment opportunities.

Director, Department of Petroleum Resources, DPR, Mr Sarki Auwalu, who disclosed, also revealed that efforts are currently ongoing to double the contribution of the oil and gas sector to the country’s Gross Domestic Product, GDP, to about 15 per cent from the current eight per cent.

Auwalu, stated this during an assessment visit to Kaztec Engineering Limited Fabrication Yard, Ilase Village, Snake Island in Amuwo-Odofin Local Government Area of Lagos State. He expressed dissatisfaction that the Kaztec facility, which was licensed by the DPR to provide support services to the oil and gas sector, had not been operational since 2015, due to contractual issues, noting that critical equipment in the facility were currently  not being utilised for the benefit of Nigeria and Nigerians.

He said: “The industry depends on facilities like this to actualise their investment because it is like a support system for the oil and gas sector. “Our visit here is that we see an edifice that we licensed and it is dormant, but we are going to make it active because we see it as an opportunity to grow the oil and gas industry.”

He noted that the facility, when functional, can play a significant role in supporting and driving the Federal Government’s gas utilisation, penetration and expansion programme.

“We have issued several licenses for modular refineries that needs fabrications. We cannot allow this kind of facility to remain under-utilized,” the DPR boss added. Auwalu affirmed that because of the shut down of the facility, some of the fabrication jobs that could be done at the facility were being shipped to China, a development which he said was was not good for Nigerian economy.

In his response, Mr Mike Simpson, Engineering Director, Kaztec Engineering Limited, said the facility became dormant in 2015 after its main contractor, Addax Petroleum declared a force majeure on its operations. Simpson said some of the unutilised equipment in the facility included a Dive Support Vessel, Pipe Laying Vessel and an already constructed Jacket which could be used for oil and gas operations.

He said the facility when it was operational had 2,000 direct employees and 7,000 indirect employees which had direct impact on the host community and its environs.