…targets 2000 high net worth jobs, as shareholders applaud strides
The chairman of the Orient Petroleum Resources Ltd, Chief Emeka Anyaoku has confirmed that the company would start crude oil exploration, production and sales next year, all things being equal.
The cheering news was made public at the just concluded 2011 Annual General Meeting (AGM) of the Company which has interest in petroleum products refining, exploration, production, sales and exports.
In his keynote address, the chairman briefly reviewed some of the fundamental developments that have taken place in the nation that directly or indirectly affects the company’s performance up to the end of August, 2011.
Looking at the performance of the company generally, Chief Anyaoku said it has an integrated business model that spans the upstream and downstream of the petroleum industry. After the Federal Government of Nigeria (FGN) granted them the Licence to Establish and the Approval to Construct its 55,000 bpsd refinery in 2002 and 2004, respectively, the company had gone ahead to obtain from the FGN in 2005 the Environmental Impact Assessment (EIA) Certificate for its refinery, the first refinery in Nigeria to obtain such an EIA Certificate.
He disclosed also that to provide additional insurance and security for crude feedstock supply, the FGN had granted to Orient on sole risk basis, two oil blocks, OPL 915 & 916, which are very close to the location of their refinery. They have since receiving the 2 oil blocks, been conducting the necessary Exploration and Production work to ensure timely provision of crude feedstock to the refinery.
The company decided early in 2011 to fast-track a staged development of its two oil blocks, OPL 915 and OPL 916 by initial completion and production testing of one of the already drilled oil wells and 3D seismic data acquisition. This staged oil field development is expected to generate cash flow to support the financing and early completion of the refinery, which is a capital intensive project.
He said that in the foregoing therefore, it is envisaged that completion of the refinery installation would be by end 2012, including overseas procurement and shipment of long lead items and on-site fabrication of storage tanks
The Managing Director, Engr Emeka Nwawka in a chat with journalists used the occasion to dissociate Orient from among the private refineries reported to have lost their operational licences. He asserted that theirs remain valid and intact.
Nwawka told the Guardian at the company’s office in Awka yesterday that they have gone far beyond that level in their operations, as they are already set to commence actual exploration, production and crude oil export within the next one year. That when that phase of their operations takes off fully it would provide no fewer than two thousand high net worth direct jobs and ancillary services.
He commended the supportive efforts and encouragement of the Federal Ministries of Finance and Petroleum, both of which he acknowledged have kept them going. He said the sector generally is desirous to have the FG’s proposed incentives gazetted and implemented as a way to stimulate their activities and programmes.
He said they would start with oil production and thereafter gas production would follow. And that since they would not borrow all the needed funds, the initial sales of the products would assist them fund some of the machineries acquisitions
According to Chief Anyaoku, the government’s economic structural reform continues with efforts to improve the stability of the banking system, curb inflation and improve the reliability of basic infrastructure; improved expenditure on which he believes partly for the declining stock of nation’s external reserves. The price of Nigeria’s Bonny light grade averaged US$62.20, US$ 80.90 per barrel, for 2009, 2010, respectively. The Gross Domestic Product (GDP) grew by 7.72% in the second quarter of 2011, up from 7.4% recorded in 2010.
The nation’s crude oil production, he stated stood at around 1.9 million and 2.47 million barrels per day(bpd) by year-end 2009 and 2010 respectively is expected to increase slightly with the passage of the Petroleum Industry Bill, which is before the National Assembly. He saw the planned removal of fuel subsidy by the Federal Government as one of the expected ways to help correct a lot of distortions in the economy, including the pressure on the currency exchange rate.
The former Commonwealth Secretary General commended the strength of the new Economic Management Team set up by the President Goodluck Jonathan, describing it as a clear demonstration of the priority being placed on the improvement of the country’s economy. He told the shareholders that the ongoing political stability in the country has been an important boost in the continuing investor confidence enjoyed by the country.
He however bemoaned the security question in the nation and admitted it still calls for much concern and hoped that the increasing focus by the Government to addressing these challenges will soon begin to yield positive results.
That they have since completed the detailed engineering, sourced the modules of its refinery and completed key project components, including:
*the acquisition, perimeter and topographical surveys of 240 hectares of land at the refinery site in Anambra State and 21 hectares at Lokoja, Kogi State for standalone petroleum products depot to serve central and northern parts of Nigeria;
*the geotechnical, geological and hydro-geological surveys at the refinery site;
*the site civil engineering works – clearing, leveling earthworks prior to construction of internal roads and reinforced concrete plinths for installation of refinery equipment.
It is envisaged that the completion of the refinery installation would be by the end of 2012 including overseas procurement and shipment of long lead items and on-the-site fabrication of storage tanks.
Taking a look at the future with optimism, the board chairman said they remain committed to maximising shareholders value and will continually adapt their business model in the challenging economic climate, to ensure that positive progress would be made in the coming months to always position the company in the path of profitability.
The company he pointed out is expected to complete construction of the refinery and commence sales at the end of 2012 and thereafter, the Board of Directors will review overall results prior to recommending a dividend.