(Quick News Africa)- The federal government’s plan to grow the nation’s crude oil reserves to 40 billion barrels by the year 2020 has received a major boost, following an agreement signed Thursday with business partners in Abuja to secure over $700 million of development funds.
Under the agreement, Schlumberger would provide the over $700 million development cost for the Anyala and Madu fields.
The agreement was between NNPC/FIRST Exploration and Production Joint Venture and Schlumberger for the development of the Anyalu and Madu fields in the Niger Delta under Oil Mining Licences (OML) 83 and 85, offshore Nigeria.
The two fields are credited with 193 million barrels of crude oil, and an additional 800 billion 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.
Nigeria’s proven reserves of crude oil are currently put at 37.2 billion barrels, while its proven gas reserves currently stand at 197 trillion cubic feet of gas, according to data from the Nigerian National Petroleum Corporation (NNPC).
Maikanti Baru, who is the group managing director of NNPC, 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, as well as monetization of the nation’s enormous gas resources.
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.
The model, he said, 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.
Patrick Schorn, he vice president of Schlumberger, who signed on behalf of the company, 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 and 85 are in shallow waters 40 kilometers offshore in the Niger Delta.
NNPC holds 60 percent interest in the licences, while FIRST E&P, the operator of the JV, holds the remaining 40 percent 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 other JV partners,” said NNPC in a statement signed by Ndu Ughamadu, its group general manager, group public affairs division.