Elf Petroleum Nigeria hopes for huge revenue from Amenam/Kpono

Oct 07, 2003 02:00 AM

Elf Petroleum Nigeria Limited (EPNL) is hopeful of realising a huge revenue of $ 2 bn from its mega oil field, Amenam/Kpono which straddles Oil Mining Leases (OML) 99 and 70, with recoverable oil put at 588 mm barrels of oil and 350 mm barrels oil equivalent of gas.
The oil field commenced operation in July this year with a daily production of about 40,000 bpd of oil. Currently, EPNL has plans afoot to increase production to 100,000 bpd between end of this year and the beginning of next year.

Disclosing this at the "Third Industry Luncheon Talk" organised by the Centre for Petroleum Information (CPI) in Lagos, the Managing Director of Elf, Georges Buresi, who was represented by Mr Adekunle Alli, Executive Director, Business and Finance, EPNL, said that with the facilities on ground, no gas will be flared from the field under normal operating conditions.
In addition, the company is presently making efforts to commence supply of 8.8 mm cm of gas from the field to Trains 4 & 5 of the Nigeria LNG Company (NLNG). In his paper entitled "Successful Unitisation of Oil Fields -- The Amenam/Kpono Experience", Mr Buresi emphasized the advantages of unitising fields and how it paid off in the two fields -- the Amenam field owned by Elf and the Kpono field owned by Mobil Producing Nigeria Unlimited (MPNU).

The Elf boss explained that because unitisation enables holders of the two straddled OMLs to proceed with the development and operation of the field as a single unit, as it is in Amenam field, there will be an ensured maximum hydrocarbons recovery and there will be no duplication of costs.
This, according to him, is made possible because a comprehensive and coherent development plan for the whole unitised field will be prepared by the designated unit operator and approved by the oil field unit participants. For example, in Amenam, Mobil and the Nigerian National Petroleum Corporation (NNPC) are unit participants.

Unitisation, according to him, is the only sure way to preserve oil conservation in situations where a field straddles the boundaries of two oil blocks. It also prevents the inefficiencies of a piecemeal development conducted independently on each OML, he added.
However, he noted that unitisation can be avoided if the unit participants do not agree. He pointed out that such a situation arises when the reserves split is clearly in favour of one licence. In addition, statutorily, the Petroleum Act does not stipulate such arrangement, therefore, it is an agreement that is entered into out of sheer understanding.

Meanwhile, he stated that during the informal discussions on the main initial issues between the two operating companies to firmly establish the claim of continuity of the Amenam field in OML 99 into OML 70, Mobil showed clear intention to have the Amenam field developed as a united field because the Kpono field was not developable on a stand alone basis and in any case it believed that the optimal development for both fields will be a unitised development.
The Chairman of the Centre for Petroleum Information, Chief Chambers Oyibo, stressed the need for oil firms to sponsor fora organised by the centre as it is a hydrocarbon specific educational, non-profit organisation, which specializes in pooling experts' knowledge and sharing value-added information for the benefit of members and the industry.

Source: Vanguard
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