Thread by @Jarushub

#PIBwithJarus

Understanding Frontier Basins

This is one area that has generated curiosity, questions among Nigerians since the passage of PIB.

Frontier, in simple language, means limit, border. So if you are extending frontier, it means you are going into unexplored areas ..

Frontier acreage in oil exploration therefore roughly means unexplored areas. The traditional area of oil production in Nigeria is the Niger Delta, which has links to the Atlantic Ocean. Frontier areas are therefore areas with potential oil outside the trad Niger Delta- new areas

Although frontier is broader, it is sometimes interchanged with inland basins - inland because they dont have anything to do with ocean.

The inland basins of Nigeria include Anambra Basin, Sokoto Basin, Bida Basin, Benue Basin, Chad basin, Benin, Gongola etc.

These are also frontier acreages because they are yet to be commercially explored although there is sufficient data to prove there are hydrocarbon deposits there.

Frontier acreages and inland basins are not new provision in Nigerian laws. The Deep Offshore & Inland Basin

Production Sharing Act (which came into effect in 1999 and amended in 2019 but now repealed by PIB) actually deals with it. They are usually combined with deep offshore in fiscal laws because they share similarities - difficult terrain, high investment requirement, unguaranteed.

Having understood what frontier fields mean, the controversy is about the provision of PIB that 10% of rents etc collected by govt from assignment of prospecting and exploration licences as well as 30% of NNPC Limited's profit oil/gas will be used to fund frontier exploration.

The propriety of this is a matter of opinion but I also think the allocation is on the high side, despite personally being pro-Oil (forget the Green Wokeness, oil is still going to be around for a long time and I don't share this West's shoving of this sustainability thing on

our throat - let everyone transit at their pace. Oil and gas are still big part of energy mix in Africa and even Asia for a fairly long time).

Oil is easy money for government. I fully support further exploration activities.

I agree we need to be more creative in funding the exploration activities. Maybe 5% of receipts PEL $ PPL, in partnership with some private investing.

But to say we shouldn't explore for more oil, I don't share that. And this exploration is not about oil alone, there is gas.

All views are personal.