Lagos — Several projects in Nigeria’s oil and gas sector have been earmarked to come on stream as President Buhari begins another fresh term in office.
While some of the projects have been in the pipeline even before his first term, others were inked during his administration, and are expected to come up in the next two years.
The Nigerian Content and Development Monitoring Board, NCDMB, has projected that in the next two years there will be an additional $25 billion investments to be invested in Nigeria’s oil and gas sector, the Board’s executive secretary, Simbi Wabote had disclosed this in Lagos at a pre-event press conference of Nigerian Oil and Gas Opportunity Fair, NOGOF in March.
“So, within the past two years, I can comfortably say that we have pushed opportunities to up to about $20 billion into the oil and gas sector, through these opportunities that we share. And I think, also in the next two years, we also, look forward to another $25 billion in the oil and gas sector going by the opportunities we have identified that we want to also share,” Wabote said.
Total’s Ikike PREOWEI, and LNG projects
The 60,000 barrels-per-day (bpd) Ikike project is one of several projects the group has earmarked in Nigeria for a final investment decision FID, including the 70,000 bpd deepwater Preowei project, which would help Total increase its oil production.
“There is a huge potential in Nigeria; it is probably the most prolific country in West Africa in terms of oil and gas, and it is time to launch new projects and we are working on many of them,” Total’s CEO Patrick Pouyanne had told reporters on the sidelines of a meeting of Nigerian and French businesses in Paris.
Total is also working on sanctioning the development of its Preowei project in Nigeria in 2019. The company will make the FID on the Preowei project this year and plans to deliver the project in the next two years.
Preowei oil field is located on OML 130, about 25 km North of Egina field in water depths of 1,150 meters. Preowei, the third producible field on OML 130, the other two are the Akpo and the Egina, was discovered in 2005.
“A great upside potential nearby (Egina) still needs to be developed and we are studying in particular Preowei discovery tie-back to the Egina FPSO,” TOTAL officials say. “An investment decision is scheduled for 2019”, they add,
Preowei is expected to produce around 70,000BOEPD at peak. The field will be developed as a tie back to the Egina FPSO, the largest deepwater floater that TOTAL ever deployed.
The French oil major also wants to expand its Nigerian LNG project this year.
The Nigerian Agip Exploration Limited, NAE says it will begin work on its Zabazaba deepwater project estimated to cost $13.5 billion this year.
The Zabazaba field development is being executed alongside Etan field and the two are expected to grow Nigeria’s oil production by 150,000 when the project comes on stream.
The firm in December began to receive commercial proposals for the various activities lined up for the development of the field.
Zabuza and Etan fields are located in oil prospecting license OPL (245) on the southern edge of the Niger Delta in water depths of 1,700 to 2,000 metres. The oil block holds oil and gas reserves of about 560 million barrels of oil equivalent. “Agip is developing the block in partnership with Shell Nigeria Exploration Company (SNEPCo). The Etan field will follow three years later and tied back to the Zabazaba FPSO from where the produced hydrocarbons will be processed and exported,” Agip said in a statement in December.
The minister of state for petroleum, Dr. Ibe Kachikwu, revealed last November, that the much-awaited Final Investment Decision, FID on the project would be finalised before the end of last year.
“The nation doesn’t plan to issue any new offshore licenses before elections due in February. We are shooting for later this year on a final investment decision at the Zabazaba development, as some contractual details are being fine-tuned”, he told Bloomberg.
The Zabazaba field development is being executed alongside Etan field, and the two are expected to grow Nigeria’s oil production by 150,000 when the project comes on stream. First production from the $13.5 billion integrated development project is expected in 2020.
Bonga South West
In February, Shell Nigeria Exploration and Production Company, SNEPCo announced the release of Invitation to Tender, ITT to contractors for the development of the Bonga South West Aparo, BSWA oil field.
The project’s initial phase includes a new Floating, Production, Storage and Offloading (FPSO) vessel, more than 20 deep-water wells and related subsea infrastructure. The field lies across Oil Mining Leases 118, 132 and 140, about 15km southwest of the existing Bonga Main FPSO.
The ITT is for engineering, procurement, and construction contracts for the 150,000 barrels per day project in the Gulf of Guinea.
“This is a new vista for deep offshore oil and gas exploration in Nigeria based on a revised commercial framework embraced by government and the project investors,” SNEPCo’s Managing Director, Bayo Ojulari said a day after the execution of the Heads of Terms by the Nigeria National Petroleum Corporation, NNPC, SNEPCo, and its Unit partners, revising the terms of the OML 118 Production Sharing Contract.
Assa North-Ohaji South gas project
The ongoing Assa North/Ohaji South gas development project in Imo State, southeast Nigeria will produce 600 million standard cubic feet of gas per day, the energy equivalent of about 2400 Megawatts which is enough to provide uninterrupted electricity to about 2.4 million homes.
The project involves Shell Petroleum Development Company, SPDC, and the Nigerian National Petroleum Corporation and Seplat Petroleum Development Co.
Seplat and Nigeria’s state oil company will raise $700 million for the project (full project value not found in public space) while SPDC plans to invest about $15 billion across 24 oil and gas projects in Nigeria in the next five years.
The project, known as Assa North-Ohaji South, is one of seven to boost gas production and infrastructure development in the West African nation, the continent’s biggest producer of crude.
The plant, which will process wet gas from the unitized upstream fields at OML 53 and OML 21, has an initial capacity of 300 million standard cubic feet per day. It’s scheduled to begin production by the last quarter of 2020 and the first supply is targeted in 2021.
The project is set to plateau at 8.5 mcm (300 mcf) per day of natural gas, which will be processed at a Shell Petroleum Development Company (SPDC) JV facility and distributed via the Obiafu-Obrikom-Oben pipeline, the company said in a statement.
“This is good news for the SPDC JV and Nigeria as we look to grow the domestic market and optimise our onshore footprints,” the managing director of SPDC and country chair of Shell companies in Nigeria, Osagie Okunbor said.
“The project is key to driving the federal government of Nigeria’s ambition of marching away from a mono-economy through diverse industrial growth. It is premier amongst the Seven Critical Gas Projects initiative led by the Ministry of Petroleum and the Nigerian National Petroleum Corporation (NNPC). Their integrated focus, support, and drive were instrumental to this investment decision,” he added.
NNPC’s 7 critical gas projects
The Nigerian National Petroleum Corporation, NNPC’s Seven Critical Gas Development Projects, 7CGDP is scheduled to deliver about 3.4billion standard cubic feet of gas per day on an accelerated basis to bridge a projected medium-term supply gap by 2020.
According to Group Managing Director of the corporation, Dr. Maikanti Baru, the 7CGDP would be executed aggressively on a sustained level.
The 7CGDP include: development of the 4.3 Trillion cubic feet (TCF) Assa North/Ohaji South field, development of the 6.4 TCF Unitized Gas fields (Samabri-Biseni, Akri-Oguta, Ubie-Oshi, and Afuo-Ogbainbri) and the development of 7TCF NPDC’s OML 26, 30 &42.
Others include; development of 2.2TCF Shell Petroleum Development Company, (SPDC) JV Gas Supply to Brass Fertilizer Company, cluster development of 5 TCF OML 13 to support the expansion of Seven Energy Uquo Gas Plant and the cluster development of 10 TCF Okpokunou/Tuomo West (OML 35& 62).
When fully implemented, the projects would enable the nation to meet its aspiration of delivering gas to support 15,000MW power generation and position Nigeria as a regional hub for gas-based industries (Petrochemicals, Chemicals, Methanol, Fertilizer, etc.).
ExxonMobil’s Qua Iboe
ExxonMobil and Qua Iboe Power Plant Limited, QIPP will invest a combined $1.6 billion in the development of gas and power projects in Akwa Ibom State.
The Nigerian Bulk Electricity Trading Plc, NBET, and Qua Iboe Power Plant Limited, QIPP had disclosed at the Power Purchase Agreement, PPA signing ceremony in Abuja in 2017, that work on the project which is expected to cost about $1.1 billion, would commence as soon as a financial closure is achieved within the second quarter of 2018.
Giving further details, the Managing Director of NBET, Dr. Marilyn Amobi, had said once the investors achieve financial closure, they would be expected to commence construction and subsequently expedite works to commission the plant within 18 to 24 months.
As at July 2018, Qua Iboe Power Plant Limited, QIPPL, the promoter of the Qua Iboe Power Plant signed a community partnership agreement, CPA with the project impacted communities in the state- Ibeno (where the power plant is located), Eket, Esit-Eket, Mkpat-Enin, Onna and Ikot Abasi local government areas
The initiative would see QIPP invest $1.1 billion in the building of a gas power plant with ExxonMobil investing $500 million in a gas project in the area, and expected to begin operation either this year or 2020.
The agreement covers critical areas such as community employment opportunities, procurement and supply contracts, and socio-economic development projects.
The NNPC, Shell, Total and Eni signed the front-end engineering design contract of the Train 7 of the Nigeria Liquefied Natural Gas Limited, NLNG mid last year.
The NLNG Train 7 project aims to increase the company’s production capacity by the expansion of Trains 1-6 and associated infrastructure at an estimated cost of $4.3bn, according to a statement by the NNPC.
Jointly owned by the NNPC at 49 percent; Shell, 25.6 percent; Total, 15 percent; and Eni, 10.4 percent, the NLNG’s journey started in 1999 with the inauguration of Train 2 ahead of Train 1, which was inaugurated in 2000.
Train 7 would increase the country’s gas production output from 22 million tonnes per annum to 30 metric million tonnes per annum.