Total to Develop Oil Field Offshore Nigeria

In a bid to more aggressively boost its oil and gas production, French oil major Total (NYSE: TOT  ) announced last week that it will begin developing Nigeria's offshore Egina oil field.

On June 21, the company said that its subsidiary, Total Upstream Nigeria Limited, and partners received the necessary approvals from Nigerian National Petroleum Corporation to begin developing the field, which was discovered a decade ago and is located about 125 miles offshore Port Harcourt and roughly 15 miles southwest of the Akpo field, in water depths of around 5,250 feet.

Total's president of upstream, Yves-Louis Darricarrère, said of the development:

Egina is the second development of the OML 130 license. Following Akpo, which was brought on stream in 2009, it will add significant value to the partnership. With more than 21 million man-hours of local work, the project will make a material contribution to the development of Nigerian economy. After more than 50 years in the country, we are confident that Nigeria will continue to provide a suitable framework to promote investments. 

The project's development plan calls for 44 wells connected to a 330-meter-long floating production, storage, and offloading vessel that can store 2.3 million barrels. According to a statement by the company, first oil from Egina is expected at the end of 2017 and oil production is expected to reach 200,000 barrels per day. The project is expected to cost about $15 billion to develop.

Total is the project's operator and commands a 24% stake. Other stakeholders include Nigerian National Petroleum Corporation, South Atlantic Petroleum of Nigeria, China's CNOOC (NYSE: CEO  ) , and Petroleo Brasilero SA.

Total and others shift Nigeria operations offshore
Total has been operating in Nigeria for more than 50 years, with its production in the country last year coming in at 279,000 barrels of oil equivalent per day. But as its recent move highlights, the French oil major is refocusing its efforts in Nigeria toward deepwater projects, which it views as one of its main sources of growth in the country.

In addition to Egina, Total operates the Akpo field in OML 130 and also maintains interests in OMLs 99, 100, and 102 through a joint venture with the state-owned Nigerian National Petroleum Corporation. Other international energy companies operating in Nigeria have also decided to refocus their efforts toward deepwater prospects, which are less susceptible to the theft and vandalism that have plagued countless projects in the interior of the country.

For instance, Chevron (NYSE: CVX  ) said earlier this month that it would sell some of its oil blocks in Nigeria's shallow waters, while Shell (NYSE: RDS-A  ) announced last week that it is contemplating reducing its production in the sabotage-prone eastern Niger Delta, while at the same time planning to boost investment in offshore gas and pipeline projects.

There are many different ways to play the energy sector, and The Motley Fool's analysts have uncovered an under-the-radar company that's dominating its industry. This company is a leading provider of equipment and components used in drilling and production operations, and poised to profit in a big way from it. To get the name and detailed analysis of this company that will prosper for years to come, check out the special free report: "The Only Energy Stock You'll Ever Need." Don't miss out on this limited-time offer and your opportunity to discover this under-the-radar company before the market does. Click here to access your report -- it's totally free.


Read/Post Comments (0) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2513712, ~/Articles/ArticleHandler.aspx, 10/21/2014 9:43:33 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement