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Monday, July 15, 2024

NNPC, TotalEnergies JV announces $550m FID on Ubeta Field Dev’t Project

In a major step towards boosting Nigeria’s oil and gas production, the NNPC-TotalEnergies JV has officially announced a $550 million Final Investment Decision (FID) on the Ubeta Field Development Project.

NNPC TotalEnergies
Minister of State for Petroleum Resources (Oil) Sen. Heineken Lokpobiri (8th from left); Minister of State for Petroleum Resources (Gas), Rt. Hon. Ekperikpe Ekpo (9th from right); Special Adviser on Energy to the President, Olu Verheijen (6th from right); GCEO NNPC Ltd, Mr. Mele Kyari (8th from right); Senior Vice President for Africa, Mike Sangster (7th from left); Managing Director/Chief Executive, TotalEnergies Upstream Companies in Nigeria, Matthieu Bouyer (6th from left) and other senior executives of NNPC Limited and TotalEnergies during the signing ceremony of Final Investment Decision (FID) agreement on the Ubeta Field Development Project at the NNPC Towers in Abuja

The milestone is in line with President Bola Ahmed Tinubu’s Presidential Executive Order on Oil & Gas Reforms aimed largely at improving the investment climate and positioning Nigeria as the preferred investment destination for the oil & gas sector in Africa.

The Ubeta field discovered in 1964, North-West of Port Harcourt in the eastern part of the Niger Delta will, once on stream, produce about 350MMScf/day of gas and 10,000 BBLS/day of associated liquids, tapping into the vast gas reserves and contributing towards securing gas supply to the Nigeria Liquefied Natural Gas (NLNG) Limited.

At the well-attended signing ceremony held at the NNPC Towers, the Group Chief Executive Officer, NNPC Limited, Mallam Mele Kyari, while appreciating the support from stakeholders, highlighted the continuous support of President Bola Tinubu’s administration in facilitating a conducive operational environment as a major enabler in achieving this success.

“We appreciate Mr. President for supporting us with the appropriate fiscal environment. The Presidential Executive Order is instrumental to us getting to this significant milestone and we are now seeing the impact of the policy,” Kyari added.

In his remarks, the Senior Vice President Africa, Exploration & Production, TotalEnergies, Mike Sangster, said: “Ubeta is the latest in a series of projects developed by TotalEnergies in Nigeria, most recently Ikike and Akpo West. I am pleased that we can launch this new gas project which has been made possible by the Government’s recent incentives for non-associated gas developments. Ubeta fits perfectly with our strategy of developing low-cost and low emission projects and will contribute to the Nigerian economy through higher NLNG exports”.

Earlier in his remarks, the Minister of State for Petroleum Resources (Oil), Sen. Heineken Lokpobiri, said President Bola Ahmed Tinubu has significantly rekindled investor confidence in the Oil and Gas Industry, assuring Nigerians that more investments are on the way.

Also speaking, the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, said the project is a testament to the effectiveness of Government’s policies aimed at creating a conducive environment for investment in the gas sector.

Located in OML58, the Ubeta gas condensate field will be developed with a new six-well cluster connected to the existing Obite facilities through an 11km buried pipeline. Production start-up is expected in 2027, with a plateau of 300 million cubic feet per day (about 70,000barrels of oil equivalent per day including condensates). Gas from Ubeta will be supplied to NLNG, a liquefaction plant located in Bonny Island with an on-going capacity expansion from 22 to 30 Mtpa, in which NNPC Limited holds a 49% interest.

Ubeta is a low-emission and low-cost development, leveraging on OML58 existing gas processing facilities. The carbon intensity of the project will be further reduced through a 5 MW solar plant currently under construction at the Obite site and the electrification of the drilling rig. TotalEnergies is working closely with NNPC Limited to enhance local content, with more than 90% of manhours which will be worked locally.

The Ubeta FID justifies the effort invested by NNPC Limited, with unyielding Executive support, into tackling the underlying reasons that have plagued the attractiveness of the Nigerian oil and gas industry to foreign investors in recent years.

The Ubeta project has a robust Nigerian Content plan and is poised to stimulate economic activities, create job opportunities, and create significant value for stakeholders.

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