The Nigerian National Petroleum Corporation (NNPC) has inked oil financing deals with two of its joint ventures (JV), one with Shell and the other with Chevron to advance two JV projects, estimated to bring in $16bn revenue.
The two sets of alternative financing agreements in this regard were made with NNPC/Chevron Nigeria Limited (CNL) JV and NNPC/Shell Petroleum Development Company (SPDC) JV.
As per the state-run NNPC, the projects will have a series of exploratory activities which in turn are expected to create jobs, improve gas supply to power and revive the industrial capacity utilization in Nigeria.
NNPC’s agreement with Chevron will advance the development of the Sonam Project (Project Falcon) in Oil Mining Licences (OMLs) 90 and 91. The estimated proven and probable oil/liquids reserves in the two OMLs are 211 million barrels while the proven and probable gas reserves of 1.9 trillion cubic feet.
NNPC expects the Sonam Project to be productive in the coming three to six months.
The agreement will cover $780m that is needed to complete the scope of the project which has so far seen an investment of $1.5bn, making up 97% of project completion costs.
Out of the new investment, $400m will be used for the development of seven wells in the Okan 30E Non-Associated Gas (NAG) well (OML 90), the Sonam field (OML 91) and related facilities including completion of Sonam NAG Well Platform.
According to NNPC group managing director Maikanti Baru, the vision of the project is to reach an additional peak production of nearly 39,000 barrels per day of liquids and 283 million standard cubic feet of gas per day (mmscf/d) of gas over the asset life cycle.
The other agreement made by NNPC with Shell will enable the development of Project Santolina which features 156 development activities in 12 OMLs and 30 different fields across the Niger Delta.
Image: Signing of the agreements between NNPC, Shell and Chevron. Photo: courtesy of Nigerian National Petroleum Corporation.