Managing Director, National Engineering and Technical Company (NETCO), Mr Johnson Awoyomi, has said cost optimisation remains the driving force behind Nigerian National Petroleum Corporation Limited (NNPC) profitablity. NETCO is a subsidiary of the NNPC.
Awoyomi spoke during an interactive session with young engineers at the Nigerian Association of Petroleum Explorationists (NAPE) 2021 Conference on Tuesday in Lagos.
He said the enactment of the Petroleum Industry Act (PIA) was a game changer for the petroleum industry, with the aim of enhancing commercial, profit and sustainability of the NNPC and its subsidiaries.
“In 2020, when others were facing loses, NNPC was able to break a 44 year jinx by declaring a N287 billion profit. What the management of the NNPC did was to improve cost effectiveness by ensuring that operating cost was reduced while also improving profit accruing to the National Oil Company. These huge profits were made as a result of the NNPC’s top management deployment of Cost Optimisation Initiatives.”
Awoyomi noted that cost optimisation was very key in the face of challenges facing the industry caused by the COVID-19 pandemic and global energy transition.
He said going forward, the NNPC was targeting to reduce the contracting cycle from 18 months to six months and was working to reduce the unit operating cost of crude oil production to $10 per barrel.