The Federal Government is currently taking measures to mitigate the impact of the oil output cut deal by the organization of the Petroleum Exporting Countries and its allies.
One of the ways it aims to achieve this is its resolve to increase the production of condensate and natural gas.
Mele Kyari, the famous Group Managing Director of the Nigerian National Petroleum Corporation, disclosed this on Wednesday at the virtual Gulf Intelligence “Global” UAE Energy Forum 2021.
Kyari put the current production of condensate in the country at between 270,000 and 350,000 barrels per day.
Condensate is an extremely light form of oil that mostly occurs as a byproduct of natural gas production. It is mostly used to make vehicle fuel such as petrol.
The NNPC boss said global oil demand would not return to pre-COVID-19 levels until the end of 2022.
He said, “The road ahead is tough and difficult. What is obvious today is that demand will pick up, not to levels that we expect.
“I do not see demand coming back to pre-COVID level earlier than the end of 2022 because several things are going on today; new habits have come up.
“There are habits that people won’t change any more. I see a clear decline particularly in transportation fuel consumption.”
He reiterated the country’s commitment to abide by the output cut agreement of OPEC+ aimed at stabilising the global oil market.
He said despite the negative effects of the production cut on government revenue, it was the best step towards redeeming the value of hydrocarbon resources at the global market in the interest of all.
Kyari noted that Nigeria’s oil and condensate production rose to 2.49 million bpd in mid-April 2020 but ‘that is now down to close to 1.6 million bpd, substantially decreasing our capacity, obviously translating to a drop in government revenue’.
He said, “Obviously the OPEC+ decision to cut production is the right thing to do because that market balancing is required by all, including the consumers.