The Peoples Redemption Party (PRP) presidential candidate, Donald Duke, has raised concerns over the high cost of securing crude oil operations in Nigeria, arguing that security expenses and poor infrastructure are driving up production costs.
Duke made the remarks during an appearance on Arise Television on Thursday, where he discussed the country’s oil industry and his proposal to reduce petrol prices.
According to him, extracting a barrel of crude oil in Nigeria costs between $12 and $15, but additional expenses associated with insecurity and deteriorating infrastructure can push the overall cost to between $25 and $45 per barrel.
He argued that the extra expenditure places an unnecessary burden on oil production and questioned why companies operating in an oil-producing country should spend so much on securing their operations.
“The actual production cost of a crude in Nigeria is anywhere between $12 and $15. What takes it up to $25 or $45 is security costs and dilapidated infrastructure,” Duke said.
He added that the Nigerian National Petroleum Company Limited (NNPC) had indicated efforts to reduce the cost to about $20 per barrel.
Duke, however, questioned the scale of security expenses, saying it was difficult to justify spending an additional $10 to $15 to secure a barrel of crude that costs between $12 and $15 to produce.
Duke Links Oil Production Costs To Petrol Prices
The PRP presidential candidate maintained that reducing the expenses associated with crude oil production could help lower petrol prices and ease the cost-of-living pressures facing Nigerians.
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He argued that the primary responsibility of government should be to create conditions that enable citizens to become more productive, stressing that high energy costs remain a major obstacle.
“I think the fundamental objective of government is the productivity of its citizens. So you’ve got to tackle all the things that are inimical to the productivity of your citizens,” he said.
Duke identified energy and access to capital as important factors in improving productivity, insisting that Nigeria’s crude oil resources should provide an advantage in meeting the country’s energy needs.
He questioned why Nigerians continued to face high petrol prices despite the country’s capacity to produce substantial quantities of crude oil.
“Now, energy is a kernel of it. Energy, capital, those things are very important. You’re an oil producing country. Supposedly you produce 1.7, 1.8 million barrels a day,” he said.
