Exactly seven months after the Minister of State for Petroleum, Dr. Ibe Kachikwu, directed the Nigerian National Petroleum Corporation (NNPC) and Shell Nigeria Exploration and Production Company (SNEPCo) to commence the tendering process for the execution of $10 billion Bonga South West/Aparo (BSWA) deepwater project, the corporation and its partners have invited prospective bidders to tender for the project, THISDAY has learnt.
Kachikwu had in June last year directed the NNPC and its partners to commence the tendering process for the multi-billion deepwater project, which is expected to add 225,000 barrels of crude oil to Nigeria’s daily production by 2022.
The minister’s directive followed the April 17, 2018 meeting between President Muhammadu Buhari and a delegation from Royal Dutch Shell Plc., led by the Chief Executive Officer, Bern Van Beurden, in London, where a decision was reached that the oil giant and the NNPC would begin the implementation of projects that had been on the drawing board for several years.
The London meeting, which was facilitated by Kachikwu, also had in attendance the Group Managing Director of the NNPC, Dr. Maikanti Baru.
The meeting was said to have presented an opportunity to open investment talks of up to $15 billion to be invested by Shell in Nigeria.
THISDAY gathered from an official of the partners that SNEPCo and the NNPC have reached agreement on the key commercial terms necessary to move the development forward.
This agreement, it was learnt, covers related production sharing contract (PSC) interpretation disputes.
“It also sets an incentivising and fair framework for developing this world class opportunity while opening further opportunities in the prolific Nigerian deepwater oil and gas industry. We look forward to realizing the significant benefits to the Nigerian state, the Nigerian deepwater oil and gas construction contractors, their workforce and the investing parties as we progress towards investment decision, construction and start-up,” the official explained.
According to the project document obtained yesterday from the partners by THISDAY, “following the Oil Mining Lease (OML) 118 Heads of Terms (HOT) agreement, we are pleased to announce the release of BSWA Invitation to Tender, where Nigerian and international companies on the agreed bid list are requested to bid for the various contract packages that make up engineering, procurement and construction of the BSWA project.
This is an important step that will allow ourselves, government and investing parties to understand the cost of the project and if within expectation, take the project to a Final Investment Decision (FID).” Estimated to cost about $10 billion, the Bonga South West/Aparo project, which has been on the drawing board for several years, is being executed by SNEPCo under a Production Sharing Contract (PSC) arrangement with the NNPC.
First oil from the project, which is expected to add 225,000 barrels per day of crude oil to Nigeria’s daily production, is expected in 2021 or 2022.
The BSWA project includes the construction of a new Floating Production, Storage and Offloading (FPSO) facility with an expected peak production of 225,000 barrels of oil per day.
THISDAY gathered that the BSWA field straddles Oil Mining Leases (OMLs) 118, 132 and 140.
However, the bulk of BSWA resources are located in OML 118 but it also extends into OMLs 132 and 140, operated by Chevron, where it is called Aparo.
SNEPCo is the operator of the BSWA project in line with the agreement between the NNPC, Esso Exploration & Production Nigeria (Deepwater) Ltd., Total E&P Nigeria Ltd., Nigerian Agip Exploration Ltd., Texaco Nigeria Outer Shelf Ltd., Star Ultra Deep Petroleum Ltd., Sasol Exploration and Production Nigeria Ltd. and Oil and Gas Nigeria Ltd.
Other key projects that have also suffered delays in Nigeria’s oil and gas industry include: the 120,000bpd Shell and Eni’s Zabazaba/Etan project in the disputed Oil Prospecting Lease (OPL) 245, ExxonMobil’s 140,000bpd Bosi project, ExxonMobil’s 110,000bpd Uge project and Chevron’s 100,000bpd Nsiko deepwater project.
The delays in the execution of these projects, which are estimated to cost about $23 billion, are largely caused by the lack of clarity of terms as a result of the non-passage of the 12-year-old Petroleum Industry Bill (PIB), and inadequate funding.
SOURCE: allafrica.com