A Review of the Nigerian Energy Industry

Total, Eni, BP bag Angolan pre-salt blocks

20 December 2011, Sweetcrude, LUANDA – Multinational oil giants, BP, Total and Eni Tuesday signed production sharing contracts in Luanda with the Angolan authorities for blocks in the country’s frontier pre-salt play.

UK supermajor BP, in particular, has more than doubled its existing Angolan portfolio after winning four blocks in the deep-water Kwanza basin and Benguela basins in the West African country’s first pre-salt licensing round, while also gaining a fifth under a separate farm-in deal.

Chief executive Bob Dudley signed PSCs in the Angolan capital with state-owned Sonangol’s president Manuel Vicente for operatorship of blocks 19 and 24, with a 50% interest, and non-operating interests of 20% and 15% in blocks 20 and 25 respectively.

In addition, BP has secured a 40% stake in Block 26 in the Benguela basin through a farm-in deal with the operator, Brazilian state oil company Petrobras.

The latest PSC deals give BP interests in nine blocks off Angola covering 32,650 square kilometres, with the five new blocks spanning 24,000 square kilometres in water depths ranging from 200 to 2500 metres.

Dudley said the latest awards underpin the company’s growth ambitions in deep water as it aims to double global exploration spending.

Italy’s Eni gained operatorship of the 4900 square-kilometre Block 35 in the Kwanza basin, with a 30% interest alongside partners Sonangol P&P (45%) and Spain’s Repsol on (25%).

The commitment under the contract covers drilling of two wells and a 3D seismic survey of 2500 square kilometres in the initial five-year exploration period.

Eni said it will draw on its deep-water expertise gained off Angola from operatorship of Block 15/06, where it has recently secured SBM Offshore’s Xikomba FPSO for the Western Hub development, as well as participation in blocks 14 and 15.

French giant Total signed PSCs with Sonangol for three deep-water blocks in the Kwanza basin, with operatorships in blocks 40 and 25, where it will hold 50% and 35% respectively, and a 15% interest in Block 39.

On Block 40, Total will be partnered by Sonangol P&P (30%) and Statoil (20%) while its partners in Block 25 are Sonangol P&P (30%), Statoil (20%) and BP (15%).

Block 39 is operated by Statoil with 55%, with Sonangol P&P (30%) along with Total as partners.

Total said the blocks, in water depths ranging from 700 to 3400 metres, had geological similarities with the Santos and Campos basins in Brazil, where major discoveries have been made in recent years.

Angola first announced the provisional awards in January this year but it has taken 11 months to finalise PSC terms.

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