“At Eroton, we believe strongly in new ways of doing things, thinking out of the box and being creative”
Dr Theo Okeke, Executive Director and Chief Technical Officer, Eroton Exploration & Production Company speaks to Orient Energy Review
In line with Dr Ibe Kachikwu’s (Minister of State for Petroleum Resources) ambition to up Nigeria’s daily crude oil production by a million barrels, Eroton, through innovative technologies has been able to ramp up its production from 10,000bpd to 65,000bpd without drilling an additional well! A marginal field operator achieving this feat with the use of indigenous engineers obviously puts itself in the league of a very few. The technology deployed here has been DOMESTICATED! And that is the major tenet of local content: in-country value addition.
In this interview with Jerome Onoja on the sideline at NOG in Abuja, Dr Theo Okeke gave some highlights. Excerpts:
What are some of the takeaways for you in the past two days of this conference?
There has been a lot of networking with people in the industry and you get to appreciate what they do and how they can add value to your business. We have been doing a lot of that since yesterday. Networking is key. Also, we get to appreciate the new technology in town and find new ways of doing things. So, it’s been beneficial to my company.
In his speech earlier today, the Minister of state for Petroleum Resources alluded to the ministry’s effort in reducing the cost of production which will affect the FID in projects, I would like to find out about Eroton’s deliberate plan in the reduction of cost with new technology.
We have a lot in the pipeline. As you know, we started production about three years ago and we have been optimizing our operations to get the best out of the old assets. For instance, we were producing less than 10,000 bpd but now we have been able to move up to 65,000 bpd peak production and we keep growing.
We achieved this by optimizing and using new ways of thinking. We added this production not by drilling a single well but by optimizing the existing infrastructure. I personally believe strongly in new ways of doing things, thinking out of the box and being creative. For instance, within our asset, because it’s a brown field, an old asset; we produce oil and water and everything is pumped to the terminal.
We asked ourselves ‘why are we doing this? Because what they charge as tariff on the pipeline is the liquid and the total volume we put in the pipeline- both the crude and the water. So, why are we paying to export water from our field to the terminal? Why don’t we take out the water within our field, and inject it for pressure maintenance? Hopefully before the year runs out, we would be injecting it into some reservoirs that we have identified which will save us cost. It will save us about $3.20/bbl we are paying now as tariff for any barrel of liquid. So, imagine that.
We do a lot of Do –It –Yourself. We do the entire major overhaul of pumps, engines and generators in-house. When we started, there was a lot of corrective maintenance but now we have very minimal breakdown of facility and equipment. The uptime of our critical equipment and facility is well over 95 per cent which is good for an old asset. We have very minimal breakdown of equipment and facility which has helped us with high uptime.
I am quite impressed. How did you achieve this? Was it in partnership?
I can tell you that this was all done in-house by Eroton people, our indigenous staff. We had to start from the scratch. We started with the staff we inherited because the working capital was not there.
Also, as a Nigerian with the amount of resources we have and experiences, we should put them to use. Sometimes, we don’t do things because we are not given the opportunity which is what I told myself. It is good enough that I started my career with one of the IOCs before I went abroad which helped to broaden my experience and my way of doing things. I see my coming down to Nigeria as a way of giving back to the country and that was why I took up the challenge and tasked my technical staff that we have to do this. To be frank, that is the success story of moving from less than 10,000 bpd to almost 65,000bpd.
To be fair, one of the things we did was working with the communities where we operate.
We recognized that the communities have something to offer. I mean we should give them the opportunities to also benefit from what is happening. We told them it will be a win-win situation and because of that, we have not had any shutdown due to community issues because we have a special way of dialoguing with them. We develop their capacities to get to do things for us. So, we told them it is not a matter of we giving you bread every time, we also want to help you so that you can do it yourself. So, they bid for contracts just like any other person, they win and get the job done and we are happy about that which has helped us a lot.
What’s your advice to other Marginal Oil field operators?
Just like in a market place there are different routes; if you have a winning team, why change it? It is working for us. We are more than happy to share our strategy with anybody. So even though we don’t make a lot of noise about our achievements, our track record is there. It is sad that we have companies that are fond of going abroad to get expats while we have competent and well experienced Nigerians that can do that job and which is one of the strategies we adopted. We said this is a 100 percent indigenous company.
Do you have a service arm?
For now, we are an E&P company. Our operations are mostly upstream. We explore and produce hydrocarbon. We have some contractors that we get into collaboration with and where we cannot do it ourselves, we employ the services of indigenous contractors. We have very minimal work with high profile contractors, we believe in local contracts, which is the only way we can build capacity as a country. If you go abroad, you’ll see how good and intelligent Nigerians are, they only need the opportunity to prove them and demonstrate what they can do.
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