Home Business Oil & Gas NNPCL, Chinese firm, others extend oil production contracts for OML 130

NNPCL, Chinese firm, others extend oil production contracts for OML 130

6 min read
access bank

NNPC Limited on Thursday announced the renewal of the Oil Mining Lease (OML) 130 production sharing contract, and the conversion of the acreage to a Petroleum Mining Lease (PML) in accordance with the provisions of the Petroleum Industry Act 2021.

At a ceremony presided over by the Permanent Secretary of the Federal Ministry of Petroleum Resources, Ambassador Gabriel Aduda, inside the NNPCL Towers, five agreements were executed.

These included a production sharing contract between NNPC Limited and its contractors – China National Offshore Oil Corporation (CNOOC) and South Atlantic Petroleum – with Total Upstream Nigeria as the operator, ahead of the agreement amendment between NNPC Limited, Total Upstream Nigeria Limited (TUPNI), South Atlantic Petroleum (SAPETRO), Prime 130 Nigeria Limited, and CNOOC.

Others included a settlement repayment agreement addendum between NNPC and its contractors (CNOOC and SAPETRO), concession contracts for one Petroleum Prospecting Licence (PPL) and three PMLs, and lease and license instruments between NNPC, TUPNI, SAPETRO, Prime 130 and Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

NNPC said the milestone had paved the way to firm up final investment decision on the Preowei, amounting to about $2.1 billion, subsequently to be followed by Egina South projects lined up by TUPNI and the OML 130 partners to introduce additional volumes to the best-in-class Egina Floating, Production, Storage and Offloading vessel.

The oil firm stated that other persons who attended the signing ceremony were the NNPC Limited Group Chief Executive Officer, Malam Mele Kyari; Chief Upstream Investment Officer, Bala Wunti; and Chief Strategy and Sustainability Officer, Oritsemeyiwa Eyesan.

Others included the NUPRC Chief Executive, Engr. Gbenga Komolafe; Managing Directors of TotalEnergies in Nigeria and CNOOC, Mr. Mike Sangstar; and Li Chunsheng; as well as the SAPETRO’s Executive Vice Chairman, Senator Daisy Danjuma; and the Chief Executive Officer of Prime 130, Aldo Perracini.

OML 130 is in the deepwater Niger Delta, 130 kilometres offshore. The block contains the producing Akpo and Egina fields and the Preowei discovery.

The Akpo field was brought onstream in 2009, while the ultra-deepwater Egina field was sanctioned in 2013 and came onstream in 2018.

The acreage was awarded to South Atlantic Petroleum via a discretionary allocation by the Federal Government in 1998 as an Oil Prospecting License 246. SAPETRO thereafter farmed out 24 per cent to Total Upstream Nigeria and 16 per cent to Prime 130 Nigeria Limited.

In 2003, the OPL was converted to OML 130 and the Federal Government, through NNPC, backed into 50 per cent of the Asset in 2005 with SAPETRO as the Contractor with 100 per cent contractor interest.

This arrangement led to OML 130 having two funding and operational mechanisms, the NNPC’s Production Sharing Contract governing half of the block and the international oil companies’ Production Sharing Agreement governing the other half.

Differences in the interpretation of the 2005 PSC led to disputes that required concerted efforts to resolve, including the execution of the Gas Entitlement Agreement in 2021 and a Settlement and Repayment Agreement in 2022.

To date, the Akpo field via the Akpo FPSO has produced over 646 million barrels of condensate, while the Egina field via the Egina FPSO has produced over 233 million barrels of crude oil.

So far, about 1.6 trillion standard cubic feet of gas have been commercialised from both fields with an outstanding record of non-zero gas flare.

OML 130, currently producing about 170,000 barrels per day is the largest producer in TotalEnergies’ Nigeria portfolio and among the most prolific assets in Nigeria.

Load More Related Articles
Load More By Breezynews
Load More In Oil & Gas

Leave a Reply

Your email address will not be published. Required fields are marked *

Check Also

Akwa Ibom governor meets Tinubu, seeks support for Ibom Deep Sea Port, others

Akwa Ibom State Governor, Pastor Umo Eno today conveyed the best wishes of the government …