Oil field
UNSPLASH

President Muhammadu Buhari is expected to officially launch the drilling of crude oil in the north on Tuesday, two years after the mineral resource was discovered in the region.

This is a major boost to the efforts of the federal government to ensure that the region produces crude oil in commercial quantities. The president will conduct the ground-breaking ceremony of the Kolmani Oil Prospecting Lease (OPL) 809 and 810 at the Kolmani field site located in Bauchi and Gombe states.

This is a historic moment for Nigeria, as the country now has crude oil reserves in both the northern and southern regions.

The new northern oil wells are estimated to contain one billion barrels of crude oil. Nigeria is expected to gain $73 billion or N32.3 trillion over 10 years if commercial production starts soon. This is based on the 2023 budget proposal which uses a global crude oil price of $73 per barrel.

The president, with the support of the Minister of State for Petroleum, Timipre Sylva, and the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPC), Mallam Mele Kyari, is expected to carry out the historic exercise, according to Daily trust.

The Nigerian Petroleum Development Company (NPDC) issued a request for expressions of interest (EoI) last year on the development of two licenses in Nigeria's northeast. The integrated development of OPLs 809 and 810 in the Gongola Basin, in the Upper Benue trough, extends about 1,000 km from the Bight of Benin to Lake Chad.

Before that, the NPDC said it had discovered "huge commercial quantities" of oil and gas in the Kolmani River, adding that the blocks were more than 700 km from the coast, posing challenges to export options.

It also proposed an onsite midstream refinery and power plant, saying that this would allow it to use these resources for local needs as well as "create an industrial hub" to provide economic benefits and employment.

At some point in the development of the facilities, in the midstream, the plan would involve a 150 MW power plant and a 50,000 barrel- per day condensate refinery.