Nigeria and its neighbours to invest in offshore oil discoveries

Aug 06, 2004 02:00 AM

Nigeria and its neighbours in the West African oil province are expected to spend a whopping $ 20 bn (about N 2.7 tn) in the next four years on the development of offshore oil discoveries. The development would brighten the chances of the province, playing a crucial role in global oil supplies.
The Nigerian and Angolan offshore are listed as major areas that would attract the bulk of the expenditure, according to a forecast for between this year and 2008 by the United States-based PennWell Group. The group, which is the organisers of the yearly Offshore West African (OWA) conference and exhibition, in a report reviewing the eighth edition of the event, also identified Nigeria and Angola for a major role in the global crude oil supplies on account of the massive field development, either on-going or planned, in their offshore terrain.

Nigeria's portion of the $ 20 bn planned expenditure could not be immediately ascertained but it was gathered that the figure is part of a larger $ 25 bn earlier projected by Nigerian exploration and producing firms for expenditure in offshore developments in the medium-to-long term, surpassing 2008.
About $ 2.7 bn of this was projected by Shell, the nation's leading oil and gas producer, for expenditure on its giant Bonga discovery between last year and this year, about $ 2.2 bn of which had already been spent on the project planned to start up before the end of the year with 225,000 bpd peak production.

Besides Bonga, other Nigerian projects in the offshore, accounting for the expenditure, include ChevronTexaco's Agbami, expected to come into production in 2007 with 250,000 barrels initial production, Total's Akpo and ExxonMobil's Yoho and Erha fields, billed for start up in 2005 and 2007 respectively.
The Angolan offshore also boasts its own elephant discoveries in Total's Girassol and Zania and ExxonMobil's Kizomba and Xikomba fields. Mainly because of their existing potential and the progress with planned projects, Nigeria and Angola are also identified by the report as strategic to the United States' national interests, especially concerning crude oil supplies.

Specifically, it has been maintained that finances for projects in the two countries could be provided more readily by US companies since they have been identified as strategic to its interests. Besides Nigeria and Angola, the West African oil province comprises such other oil producing nations in the Gulf of Guinea as Gabon, Cameroon, Equatorial Guinea, Congo, Namibia, Sao Tome and Principe, Cote D'Ivoire and Mauritania.
The report by the group believes that deepwater prospectivity and development for the region was extensive and of extreme interest, noting that recent seismic and soon-to-be-drilled prospects could well confirm further elephant discoveries.

It specifically said of Nigeria's leadership role: "Nigeria's leadership in gas utilisation is a catalyst to other West African countries with several potential LNG plans being considered and significant cooperation between countries on major gas trunk lines.
For Angola, it said: "Stability in Angola is a catalyst to increasing production from 900,000 bpd in 2002 to an estimated production of 1.5 mm bpd in 2006. A 4 mm-ton LNG plant is due to come on stream in 2007 and a 200,000 bpd refinery is under construction."

Source: LiquidAfrica
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