Africa Oil Corp., a Canadian oil and gas company, has secured a significant boost to its long-term operations in Nigeria with the renewal of its Petroleum Mining Lease 52 (PML 52) for an additional 20 years.
This renewal, granted by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), ensures the continued production of the Agbami oil field, one of Nigeria’s largest deepwater discoveries.
The Agbami field, located approximately 113 kilometres off the coast of the central Niger Delta, is a prolific producer of high-quality, light crude oil. Its development involves subsea wells tied back to a Floating Production Storage and Offtake (FPSO) vessel.
Roger Tucker, CEO of Africa Oil, expressed his satisfaction with the renewal, stating, “The renewal of PML 52, following last year’s renewals for Prime’s Akpo, Egina, and Preowei fields, solidifies our long-term production outlook from these high-quality assets”.
“With respective 20-year renewals for each of these fields, our long-term production outlook from these high-quality assets is secure. We thank NUPRC for its efficient processing of the application and issuing the renewal,” Tucker said.
PML 52 covers 62.46 percent of the producing Agbami field discovered by the Agbami-1 well in 1998.
The oil is light with a gravity of 45° to 47° API. The field is developed via sub-sea wells tied back to a dedicated Floating Production Storage and Offtake (FPSO) vessel through steel catenary risers.
Production commenced in June 2008 and peak gross field production of 250,000 barrels of oil per day (bopd) was attained in 2009.
At December 31, 2023, 30 producers, 5 gas injectors and 10 water injectors had been drilled. The field average oil production rate in 2023 was about 98,000 bopd. Cumulative oil production to December 31, 2023, was 1,089 million barrels for the field.
The largest interest in the PML 52 production sharing agreement of 60 percent is held by Famfa Oil, followed by Chevron’s 32 percent operating interest and Prime Oil & Gas Coöperatief’s 8 percent. Following the completion of the amalgamation transaction, the Canadian player’s 50 percent interest in Prime, and thus its stake in the PML, is set to increase to 100 percent.
The completion of the amalgamation is subject to several customary closing conditions, including competition clearance from the Federal Competition & Consumer Protection Commission (FCCPC), approval from Nasdaq Stockholm, completion of the previously announced farm-down of Africa Oil’s Namibian interests that are held via Impact Oil & Gas Limited, and a reorganization of the holding structure of BTG Pactual Holding to implement the amalgamation.
Agbami FPSO
The FPSO was built by South Korea’s Daewoo Shipbuilding & Marine Engineering.
Daewoo awarded the contract for engineering design and procurement services for the topsides to KBR and the class contract to ABS in 2005.
The Agbami FPSO cost $1.2bn to construct and features an overall storage capacity of 2.15 million barrels of crude oil.
It originally arrived amid secrecy at the field at the end of 2007 and is one of the largest facilities of this type ever built.
The Agbami development is expected to be of value to less complex refiners, especially those with no vacuum residuum conversion.
It has 13 topside modules containing the main process and utility systems. Weighing approximately 30,000t, the vessel topsides generate 75MW of power and have accommodation for 100 personnel.
The FPSO is moored in about 4,800ft of water and it is expected that at least 40 subsea wells will be necessary to fully exploit the field.
It can handle 250,000bpd, 450 million cubic feet of gas production and 450,000 barrels of injected water a day.
The FPSO was designed to store approximately 2.2 million barrels of oil and is scheduled to be on location for over 20 years.
Agbami is expected to be of value to less-complex refiners, especially those with no vacuum residuum conversion, limited hydrotreating/sulphur recovery and limited cracking capacity.
Dipo Oladehinde is a skilled energy analyst with experience across Nigeria’s energy sector alongside relevant know-how about Nigeria’s macro economy. He provides a blend of market intelligence, financial analysis, industry insight, micro and macro-level analysis of a wide range of local and international issues as well as informed technical rudiments for policy-making and private directions.(BusinessDay)
