In this article, we shall be looking at the functions of the Department of Petroleum Resources in Nigeria, and also their roles in the upstream and downstream sector. You will also get to see the functions of DPR in revenue generation in Nigeria. Read to the end to get more facts about this department and sector of the Nigerian economy.
The Department of Petroleum Resources (DPR) is a department under the Nigerian Federal Ministry of Petroleum Resource (FMPR). It is responsible for matters dealing with exploration and importation of petroleum products. DPR is charge of health, safety, and environmental regulations in the trade of petroleum products in Nigeria.
Also read: Functions of INEC Which Every Nigerian Should Know
The department also controls the upstream and downstream in Nigeria petroleum industry. Through the National Production Monitoring Systems (NIPMS), the DPR is able to monitor payments to the federal government through royalties, rents and penalties from all organizations dealing in petroleum in Nigeria.
Also read: Complete List Of Oil Producing States in Nigeria
Functions of the Department of Petroleum Resources (DPR)
The Department of Petroleum Resources is enabled by the Nigerian constitution to ensure compliance to the petroleum regulations, guidelines and laws in the Oil and gas industry. This includes supervising all operations at drilling sites, oil wells, platforms and flow stations, refineries, pump stations, export terminals, retail outlets and any other location where petroleum is traded or stored. This also includes all pipelines carrying petroleum products, natural gas and crude oil. Other functions of the Department are:
- Overseeing all operations of the petroleum industry carried out under licenses or leases within the country.
- Keeping close watch over all activities of the industry including those related to Flare down and Domestic Gas Supply Obligations to make sure they are in compliance with the nation’s laws and goals.
- Supervising all petroleum industry operations, being carried out under licenses and leases within the country.
- Ensuring that health, safety & environment regulations conform to national and international standards.
- Keeping records operations of the petroleum industry operations, particularly on matters relating to petroleum reserves, production/exports, licenses and leases.
- Consultancy services to the government and other relevant government agencies or organizations on technical matters and public policies that may have an impact on the operations and activities of the petroleum industry.
- Processing industry applications for leases, licenses and permits required for operation related to the oil and gas industry.
- Ensure prompt and accurate payments of rents, royalties and other revenues due to the government.
- Keeping up and administering the National Data Repository (NDR)
Operations of the Department of Petroleum Resources
UPSTREAM
Roles of the Department of Petroleum Resources – Upstream
- Regulation of all activities in the Oil and Gas industry Oil and Gas activities
- Conservation of Nigeria’s Hydrocarbon Resources
- Ensure firm adherence to Health, Safety & Environment (HSE) Standards in petroleum operations
- Maximize government take in Oil and Gas activities
- Keeping up and administering the National Data Repository (NDR)
- Administer areas, portions and concessions used for Oil and Gas operations
- Implement government policies on matters related to Upstream Oil and Gas.
DOWNSTREAM
These are activities which take place between the transfer of crude oil on the field and loading at the export terminal even down to the use of the oil by the consumer.
Downstream includes the ocean transportation of crude oil, supply and trading, refining, distribution and marketing of the oil products.
Roles of the Department of Petroleum Resources – Downstream
- Responsible for the approval of licenses for refineries, petrochemicals, fertilizer plants, jetties, depots, lube blending and retail outlet
- The nomination of vessels for crude, condensate & NGL exportation
- Ensure the soundness of downstream Oil and Gas facilities and pipeline systems
- Ensure honest measurements at custody transfer points
- Issuance of importation permits and clearance for petroleum products
- Issuance of export permits for crude oil and petroleum products
- Determine and endorse the quality of imported petroleum products to ensure they meet established standards.
- Enforcement of government policies on downstream Oil and Gas matters.
Functions of Department of Petroleum Resources in Revenue Generation
Royalty
This has to do with charges made by the department and shares of the profit paid by Royalties on all producing fields
Rent
The department is responsible for collecting rents for the federal government of Nigeria from concessions awarded yearly. The department then pays this into a Federal government account with the Central Bank of Nigeria.
Petroleum Profit Tax (PPT)
The Federal Inland Revenue (FIRS), a part of the department collects the petroleum profit tax for the federal government of Nigeria.
Gas Flare Penalty
This has to do with revenues generated from penalties levied on oil companies for gas flaring. Gas flaring is when natural gas associated with crude oil is burned off in the atmosphere when it is pumped up from the ground. This penalty is meant to deter companies from frequent gas flaring.
Other operations of the Department of Petroleum Resources are Engineering and Standards, Laboratory, Gas, Health, Safety and Environment.
Conclusion Reading this article up to this point, I am sure you must have gotten all the knowledge about the functions of the Department of Petroleum Resources in Nigeria and the important roles they play. You can easily subscribe to this site to get more facts about Nigeria delivered straight into your email.
