Avuru raises alarm over depleting 'reserves addition'
The Managing Director of Seplate Petroleum Development Company, Austin Avuru, has the raised alarm over the declining rate of the country's yearly crude oil reserve addition, which he said, was getting close to zero flat line.
Avuru, while speaking at the February Technical Meeting of NAPE on Wednesday, stated that the country has the lowest reserve and production ration for crude oil among Organisation of Petroleum Exporting Countries (OPEC).
According to Aruru in a paper titled: 'Policy and Activity in the Nigerian Petroleum Sector', 'our current oil reserve estimates stand at about 35 billion barrels. Average yearly reserves addition in the last 10 years is about 800 million barrels, while average yearly withdrawal rate over the same period is about 840 million barrels. This would seem to suggest that we are already at, or very close to the zero flat line in net reserves addition. The situation, of course gets worse as we strive to attain a target daily production rate of four million barrels'.Comparing the nation's crude oil reserves estimates with those of other OPEC member countries, Avuru disclosed: 'Even at that, Nigeria's current reserve/production ratio for oil, at 38 years, is one of the lowest in OPEC, with UAE having production and reserve ration of 98 years; Iran, 93 years; Kuwait, 98 years; Saudi Arabia, 67 years; Venezuela, 73 years; and Libya, 63 years.
'The overall picture, therefore, suggests that our projections and aspirations for future oil and gas production must, henceforth, be within the context of a long term composite national plan, taking into account what we earn, what we do with what we earn and how long these earnings will continue to roll in. If we have had a 50-year history of a squandered heritage, our future must take a new turn'.
He lamented that about $400 billion, which the country earned from economic rent from the 27 billion barrels of oil produced, was not fully utilised by the government.
Avuru said: 'A rent economy such as ours is usually a very difficult one to manage. In our case, less than two per cent of the adult population is responsible for generating 95 per cent of our export earnings. This translates to a very low per capital productivity, while creating a false sense of national wealth. With a very large proportion of the employable population essentially engaged either in the distribution of this rent or just queuing up to somehow receive a portion of it, the result is a large measure of unemployment, widespread frustration and instability'.
He said that efficient management of a rent economy, requires a consistency of disciplined and visionary leaderships, capable of applying the ample rent so collected to fund a long term program of massive education of the citizenry, provision of quality healthcare and a solid infrastructure backbone as well as guaranteeing security of lives and property.