Engr Gbenga Komolafe, CEO Nigerian Upstream Regulatory Commission (NUPRC) is a man with many years of leadership experience at various levels of the oil and gas industry. Over the years, he has been involved in strategic policy formulation and implementation in the oil and gas industry. Now as the head of NUPRC, an agency saddled with the responsibility of regulating the technical and commercial activities of the upstream petroleum sector and to get things going the right direction. Komolafe has done just this.
Since coming to office as the first CEO of NUPRC in August 2021, Komolafe has been making the Commission to pursue aggressive identification and promotion of new projects and new field developments, to boost the national oil production, working with all stakeholders in strategic areas, without prejudice, to the mid and long-term strategies. Also he is steering implementation of some immediate (short term) oil gain strategies in the light of current realities and upward trends in international crude oil prices and need to shore up Nigeria crude oil production..
At the time of taking off of the NUPRC last year, one key task ahead of its management was the task of closing out on the 2020 marginal oilfield bid round in a manner that is consistent with the rules guiding approvals and issuance of licenses in the upstream sector of the nation’s oil and gas industry.
He was recently quoted as saying the need to ensure that law and due process are followed in the award of licenses to operators. He assured that under his leadership, no marginal field operator would be allowed to “trade” in papers issued by the organisation as the rule of law would be strictly followed in the issuance of final licences to the winners.
Due process is the only way, according to Komolafe, and having given his word to Nigerians and all oil and gas stakeholders that under his watch, no amount of pressure would make the NUPRC award final documents without due process.
He is also working to deal with the issue of gas flaring. He disclosed that the Commission was currently engaging all lessees on their Natural Gas Flare Elimination and Monetisation Plan to ensure compliance with Section 108 of the PIA and to boost supply to the rapidly growing gas market.
“In recognition of the global energy transition and the need to achieve cleaner sources of energy, gas is being positioned as our immediate transition fuel to lower carbon emission footprint in line with our climate change commitment.”
Under his watch, the NUPRC has been encouraging investors to leverage the generous gas fiscal incentives in the Petroleum Iindustry Act (PIA) such as the zero hydrocarbon tax, reduced royalty rates, tax consolidation provisions amongst others, to take Final Investment Decisions on their proposed upstream projects.
He said “With a proven gas reserve base of 208.62TCF (as at 1st January 2022), we are on track to increase our reserves volumes to 220TCF in less than 10 years and 250TCF thereafter.” Nigeria produces about 8BSCF/D of gas, out of which circa 20percent is delivered to the domestic market, approximately 40 percent is exported to international markets, 30 percent is utilized for producer’s internal consumption.”
Achievements
Dealing with the menace of oil theft is on the radar, staff welfare is robust, on-going also is a campaign targeted at identifying oil and gas wells producing below capacity. Equally important are incentives now being offered to oil/gas industry investors. Then the closing of the marginal field bid round.
Apart from the task of closing out on the 2020 marginal oilfield bid round in a manner that is consistent with the rules guiding approvals and issuance of licenses in the upstream sector of the nation’s oil and gas industry, he is fully concerned with seamless workings of all parts of the oil industry. To rapidly achieve this staff welfare is key. As a team player who sees career enhancement as a productivity booster, he considers his staff welfare as top priority and a winning strategy.
In line with the critical and significant role of the oil and gas sector in the nation’s economy, especially amidst the call for divestments in the sector, “The best and only option opened to us to maximise the benefits from fossil fuels is to improve the welfare of those who are saddled with the responsibilities of managing the sector.”
To him, “human capital is a critical and essential element of factors of production as staff need to be happy before they can work and we had assured them of the determination of the Federal Government to look after their welfare,” He said.
“I have ensured immediate approval for promotion of 195 union staff that have been stagnated in the defunct Department of Petroleum Resources (DPR) to stave off an industrial crisis that could further harm the low daily oil production in Nigeria and worsen the nation’s federation generated oil revenue. So what we have done is by extension to improve the nation’s revenue by increasing crude oil production from the current level of 1.4 mbbls/d to 2.4 mbbls/d”.
Giving account of the nation’s oil reserves as NUPRC boss, shortly after his appointment last year, he disclosed that a total of sixty-one (61) operating companies submitted their 2021 annual report on reserves in line with the provisions of the PIA, 2021.
Analysis of the report indicates that Nigeria’s oil and condensate reserves status as at 1st January 2022 was 37.046 billion barrels, representing a slight increase of 0.37 percent compared to 36.910 billion barrels in January 2021.
Giving account of the nation’s oil reserves as NUPRC boss, shortly after his appointment last year, that a total of sixty-one (61) operating companies submitted their 2021 annual report on reserves in line with the provisions of the PIA, 2021.
Analysis of the report indicates that Nigeria’s oil and condensate reserves status as at 1st January 2022 was 37.046 billion barrels, representing a slight increase of 0.37 percent compared to 36.910 billion barrels in January 2021.
On the other hand, Nigeria’s National Gas reserves status as of January 1, 2022 was 208.62 (trillion cubic feet) TCF, representing an increase of 1.01 percent compared to 206.53 TCF as at January1, 2021.
Meanwhile, as part of the Commission’s plan to consolidate an all-inclusive strategy to increase crude oil and gas reserves (from 37 billion barrels and 208.62 TCF) the commission said it would take further steps evaluate all factors militating against efficient and effective exploration and production operations, to identify other viable opportunities.
He said “We have therefore become more deliberate and swift in implementing strategic actions and initiatives aimed at increasing our crude oil and gas reserves and production.”
Already, the Commission has initiated a massive campaign targeted at identifying oil and gas wells producing below capacity, through, Inventorisation of shut-in wells and analysis of the inventory to map the reasons for shut-in and devise measures for quick reopening; Using well and reservoir surveillance activities in identifying poorly performing wells and workover candidates for quick intervention; Embracing and adopting new technologies and advanced recovery techniques for unlocking some identified stranded oil and gas resources.
These measures have become so critical in the face of the current conflict between Russia and Ukraine and its attendant disruption to the global gas demand-supply chain. According to Komolafe, the crisis around the Black Sea offers the country a unique opportunity to fill the supply gap through the implementation of several natural gas developmental initiatives.
This development, coupled with the Federal Government’s declaration of 2021 – 2030 as the Decade of Gas, creates much more impetus for NUPRC under Mr Komolafe to expand and grow Nigeria’s huge gas resources through enhanced exploration, development and utilisation schemes. And for him, the whole idea is to grow Nigeria’s gas reserves, increase gas production, maturation of domestic and export gas market, as well as minimise gas flare.
Why has Komolafe able to do all these within a year of being in office as the CEO of NUPRC?
It is because of his experience as a through-bred oil industry person, described as an “an expert in institutional process study and designs to curb revenue leakages and attainment of optimum national productivity.” He has lived up to this expectation at the NUPRC since coming into office in September 2021.
Before then he had served in different capacities within the oil and gas industry. His leadership roles at different downstream regulatory agencies such as Pipelines and Petroleum Marketing Company (PPMC), Petroleum Equalisation Fund (PEF), Petroleum Products Pricing Regulatory Agency (PPPRA), Nigeria Pipeline & Storage Company (NPSC among other roles, have yielded reforms that facilitated efficiency and attendant huge monetary value for Nigerian government. Komolafe had served as group general manager, special duties at the NNPC as well as crude oil marketing division.
He also worked as general manager, operations, Petroleum Equalization Fund (PEF); general manager, operations of the Petroleum Products Pricing Regulatory Agency (PPPRA), among other roles. As general manager of this agency, Komolafe organized the seamless supply of petroleum products nationwide with multiplier sectorial effects on the Nigerian economy.
In PEF, Komolafe was reported to have initiated operations policies for effective petroleum products supply and bridging to the inner parts of the country. The policies resulted in the transparent bridging of petroleum products and price equalization management that saved the government hundreds of billions of naira through institutional process expertise.
He was Assistant General Manager (Head, Kaduna Zone), Assistant General Manager, Planning Research & Development and Branch Manager, Nigeria Social Insurance Trust Fund (NSITF), Warri.
As Group General Manager, Crude Oil Marketing Division, he facilitated optimum revenue for the Nigerian federation and performed transparently as acknowledged by the Nigeria Extractive Industries Transparency Initiative (NEITI) in its report within the period he served in office. In the same vein, as Executive Director, (Commercial) between 2012 – Mar 2014, he initiated strategic sales and retail plans and coordinated implementation of achievement of set revenue targets from downstream supply and distribution of refined petroleum products for nationwide consumption.
It is this impressive track record that prompted President Muhammadu Buhari to appoint Engr Gbenga Komolafe in 2021 to head the newly created Nigerian Upstream Petroleum Regulatory Commission (NUPRC), as its first Chief Executive Officer. The agency was established in August 2021 pursuant to the passage of the Petroleum Industry Act, 2021. NUPRC is responsible for the technical and commercial regulation of upstream petroleum operations in Nigeria.
Apart from being an engineer, Komolafe is also a lawyer. And he is well prepared for the new challenges of solving industry problems within the oil/gas sector of the Nigerian economy.
So all along he has been heavily involved in strategic policy formulation and implementation in the oil and gas industry, where he clearly distinguished himself. All these he brought to bear when he was appointed at CEO of the NUPRC, which ensured that he hit the ground running. That is why after a long wait, the federal government through the NUPRC announced its readiness to issue Petroleum Prospecting Licences (PPL) to successful awardees of marginal fields in the 2020 bid round. According to the commission, the move was in fulfilment of the promise made earlier on, pursuant to the provisions of the Petroleum Industry Act (PIA), 2021.
The NUPRC was created by the Petroleum Industry Act (PIA) as the new petroleum upstream regulatory agency in place of the defunct Department of Petroleum Resources (DPR). The staff were inherited from there.
And with its coming into being, the problems are expected to be fully tackled along with the commercialization of the NNPC. This will include increased crude oil production. It will also witness the unveiling of the implementation template for the Host Communities Development Trust Fund for the commencement of the provisions under Section 235 of the PIA, 2021. According to analysts this would positively impact restiveness in the host communities and the process guarantees seamless operations and boost investors’ confidence.
A Fellow of Nigerian Society of Engineers, Council of Registered Engineers of Nigeria, COREN and member of the Nigerian Bar Association, Gbenga’s expertise as a seasoned engineer and lawyer is required at this time to give the PIA the right impetus. Hence the quite achievements being recorded by the NUPRC.
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