…As NNPC/FIRST JV Secures over $700 million Schlumberger Funding for New
Fields
The plan by the Nigerian National Petroleum Corporation to grow the
nation’s crude oil reserves to 40 billion barrels by the year 2020
received a major boost on Thursday with the execution of a tripartite
agreement in Abuja.
The agreement was between the NNPC/FIRST Exploration & Production Joint
Venture and Schlumberger for the development of the Anyalu and Madu fields
in the Niger Delta under Oil Mining Licence, OML 83 and OML 85, offshore
Nigeria.
Under the agreement, Schlumberger would provide the over $700 million
development cost of the Anyala and Madu fields which would generate 193
million barrels of crude oil into the current reserves of 37.2billion
barrels and an additional 800 billion cubic feet of gas into the nation’s
proven gas reserves which currently stand at 197 Trillion Cubic feet of
gas .
In terms of daily production, the fields will yield 50, 000 barrels of
crude oil per day and 120 million standard cubic feet of gas per day by
early 2019.
Speaking at the signing ceremony, Group Managing Director of the NNPC, Dr.
Maikanti Baru, said the innovative approach to funding JV operations in
response to the challenging economic environment was novel and aligned
wholly with the government’s aspiration to increase crude oil and gas
production, reserves growth and monetization of the nation’s enormous gas
resources.
He added that apart from serving as a test case for future funding
mechanism, the approach adopted was in sync with the realization of the
corporation’s 12 Business Focus Areas (BUFA) which is to ramp up crude oil
production and reserves growth, amongst others.
He said the projected increase in production of gas would come in handy as
the Corporation strived to sustain the supply of gas to the existing power
plants as well as the planned power projects billed to come on board
within the period.
Managing Director and CEO, FIRST E&P, Ademola Adeyemi-Bero, who signed on
behalf of FIRST E&P, remarked that the partnership between the NNPC/FIRST
E&P JV and Schlumberger would infuse a novel asset development model which
combines FIRST E&P’s local knowledge and market position as an indigenous
operating company, with Schlumberger’s financing and broad technical
capabilities.
He added that the joint project team would strengthen FIRST E&P’s project
delivery abilities and the model would offer the Upstream subsector a
credible alternative funding and technical partnership model for growing
production and adding reserves.
On his part, Patrick Schorn, Vice President, Schlumberger, who signed on
behalf of Schlumberger traced the advent of the multi-national oil fields
service company in Nigeria to the first commercial oil find in Oloibiri
when Schlumberger played a role in Shell’s drilling effort.
He noted that the partnership with NNPC and FIRST E&P would provide
Schlumberger the opportunity to leverage on its reservoir knowledge,
oilfield services and project management expertise to lower development
costs and maximize value for the partners.
The OMLs 83& 85 are located in shallow waters 40 km offshore in the Niger
Delta, NNPC holds 60% interest in the licences while, FIRST E&P, the
operator of the JV, holds the remaining 40% interest. Apart from providing
funding for the development of the fields, Schlumberger would also provide
other Oilfield Services to the JV on a limited exclusive basis. A joint
project team would be established to drive technology transfer whilst
leveraging on the global technical expertise of Schlumberger and the
extensive local knowledge of the JV partners.