The Nigerian National Petroleum Corporation (NNPC) has signed a contract with its partners on oil mining lease OML 118 to expand the Bonga oilfield and unlock a $10 billion investment in the country’s deepwater resources.
S&P Global Platts, which provides benchmark prices for commodity markets around the world, reported this on Wednesday.
OML 118 contains Bonga, Nigeria’s first deepwater oil field which can produce 225,000 barrels per day of crude oil and 150 million standard cubic feet of gas per day.
Shell had previously said it would develop the Bonga Southwest project across three phases with a total potential yield of 3.2 billion barrels.
The report quoted NNPC as saying that the OML license for the block partners Shell, Total, Exxon Mobil and Eni were renewed for another 20 years and five agreements including settlements on a tax dispute and production sharing contracts were finalised.
“Over $10 billion of investment would be unlocked” in an expansion program on the Bonga field as a result of the settlement of the disputes,” the S&P Global Platts report quoted Mele Kyari, NNPC group managing director as saying in a statement.
The Bonga Field is located in OML 118 which covers approximately 60 km2 in an average water depth of 1,000 metres (3,300 ft). The field was discovered in 1996, with government approval for its development given in 2002. The field began first production in November 2005. The field is worked via an FPSO vessel. The field produces both petroleum and natural gas; the petroleum is offloaded to tankers while the gas is piped back to Nigeria where it is exported via an LNG plant. The field is operated by Shell Nigeria who own 55% of the license. The other partners in the field development are Exxon (20%), Nigerian AGIP (12.5%) and Elf Petroleum Nigeria Limited (12.5%)
The Nigerian National Petroleum Corporation (NNPC) is the state oil corporation which was established on April 1, 1977. Between 1978 and 1989, NNPC constructed refineries in Warri, Kaduna and Port Harcourt and took over the 35,000-barrel Shell Refinery established in Port Harcourt in 1965.
(Source: Premium Times/Shell/Wikipedia)