The Petroleum Industry Act (PIA) establishes the Frontier Exploration Fund to support exploration and development in Nigeria’s frontier acreages.
The Nigerian Senate has said it will summon the management of the Nigerian National Petroleum Corporation Limited (NNPCL) over the lack of funds to explore and develop new frontier acreages.
The Chairman, Senate Committee on Gas, Jarigbe Jarigbe, disclosed this Friday while addressing reporters after a session held behind a closed-door with the Chief Executive Officer of Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Gbenga Komolafe, and his team.
The Petroleum Industry Act (PIA) establishes the Frontier Exploration Fund to support exploration and development in Nigeria’s frontier acreages.
These areas include regions like Anambra, Dahomey, Bida, Sokoto, Chad, and Benue where hydrocarbon exploration is yet to occur or remains undeveloped.
The PIA further stated that the Fund, constituting 30% of NNPCL’s profit in oil and 30% gas from various contracts, will finance exploration and development activities in these frontier acreages.
According to Daily Trust, Senator Jarigbe said, “We received a briefing from the CEO of NUPRC and his team on the activities of the agency.
“Section 9 subsection 4 and 5 provides that the NUPRC should have a Frontier Acreages an exco account for the exploration and development of frontier acreages and that fund is subject to the approval of the National Assembly.”
He added “Also, section 22 subsection 1 of the Petroleum Industrial Act also provides that the National Assembly oversights the budget and expenditure of the NUPRC.
“So, we had to interact with the commission on those issues and we discovered that there is no fund raised from 30 percent oil profit and 30 percent gas profit as provided for in Section 9 subsection 4 of the PIA.
“So, we also intend to engage with the NNPCL on that. We don’t know the budget because we weren’t given any figure. We will get details on that and get back.”
Earlier, the CEO of NUPRC said gas was very crucial in the revenue generation of the country, just like oil, it is equally very critical.
He, however, said the major challenge militating against gas production was a lack of funds and infrastructure.