Why Measurement, Metering are Critical in Nigeria’s Oil, Gas Sector
Oil and gas stakeholders in the country have linked the growing crude oil theft and subsidy misalignment to the inadequacy of metering and measurements in Nigeria.
While the Minister of State for Petroleum Resources, Timipre Sylva had admitted that subsidy level on daily Premium Motor Spirit (PMS) consumption, which is estimated to gulp over N3 trillion this year alone is not known, current crude oil theft put at 91 per cent on some pipelines also remained a guess work as government lacks adequate metering and measurement approach to determine the actual loss.
Recall that most Nigerian cities have been struggling with scarcity of petrol as the country relies mainly on importation despite being a leading producer of crude oil.
The Nigerian Extractive Industry Initiative had noted earlier that Nigeria was losing billions in revenue by relying on international and indigenous oil companies to determine the amount of crude oil they produce.
While some stakeholders are already working hard to lead conversation on the issues of measurement and metering with the Nigeria Hydrocarbon Measurement Conference (NiHMEC 2022), the opinion of some members of the committee planning the conference was that since oil producing companies in Nigeria would not export crude oil without determining the Basic Sediment and Water (BS&W) content of the crude oil, measurement and metering should therefore not be a concern in the industry.
Member, NiHMEC Technical Advisory Committee (TAC), Andy Orji noted that since the country analyzes its crude oil before exporting, the same requirement should ordinarily be applied for the fuel it imports into the country.
He believes that prevailing development leads to the bigger metering problem of even determining the quantity of PMS consumed in the country and the quantity imported (and subsidy paid).
On the crude oil production and export side, Orji noted that Nigeria has been losing revenue due to loss in production, adding that a huge difference exists between the quantity of crude oil reported at production facilities compared with the quantity exported (and revenue derived from).
According to him, the second edition of the Nigeria Hydrocarbon Measurement Conference (NiHMEC 2022) takes on the need to start correcting the loopholes and strengthening the standardization of measurement practices, processes and procedures in Nigeria’s petroleum industry.
He said the second edition, projected to hold in Abuja from 7th to 8th June 2022 and organized by industry professionals who have chosen to take the bull by the horn by bringing together all stakeholders to discuss pressing measurement issues in the Nigerian Oil and Gas Industry with a view at proffering solutions to problems specific to the Nigerian environment would explore the role of innovation in hydrocarbon measurement and data management as key success factors in value realization across the entire hydrocarbon value chain.
The conference will also look at new challenges to accurate and reliable hydrocarbon measurement in Nigeria and proffer technological and innovative processes and systems to mitigate the challenges.
Riding on the success achieved during the maiden NiHMEC that was held virtually in 2021 due to Covid19, NiHMEC 2022 aims to discuss measurement challenges and solutions specific to the Nigerian environment and which are vital to effective and sustainable hydrocarbon resource management.