By Gbenga Adedayo
Hope of raising Nigeria’s crude oil production by 225,000 bopd brightened recently as all legal disputes surrounding key commercial terms involving the production sharing contract (PSC) on Bonga South West/Aparo (BSWA) deepwater project have been fully resolved, paving the way for final investment decision (FID). The dispute is between Shell Nigeria Exploration and Production Company (SNEPCO) and the Nigerian National Petroleum Corporation (NNPC).
The field (BSWA), which is located in Oil Mining Lease (OML) 118, straddles Chevron Nigeria Limited’s oil fields of OMLs 132 and 140, making this part to be called Aparo. Besides Shell and NNPC, Total, Eni, and Sasol Petroleum are partners in the project, which is estimated to cost over $10 billion.
With all legal hurdles out of the way, NNPC and Shell have commenced invitation of prospective bidders to tender for the development of the $10-billion Bonga South West/Aparo (BSWA) deepwater project with an initial phase to include a new Floating, Production, Storage and Offloading vessel, together with more than 20 deep-water wells and related subsea infrastructure.
According to Cao Chai, an upstream oil and gas analyst at GlobalData, the move on BSWA is a key step toward FID. She said it will open further deepwater opportunities in Nigeria. “BSWA fits in with Shell’s renewed focus on deepwater projects, with the company sanctioning a significant number of projects in Brazil and the Gulf of Mexico over the past few years. Shell is also well-established in Nigeria with the deepwater Bonga Complex already in production and a large portfolio of onshore assets, most of which were granted license renewals last year,” Chai said.
Also, the Group General Manager, Corporate Planning and Strategy, NNPC, who also doubles as head of the Bonga South-West Project dispute resolution team, Bala Wunti, said the resolution of the legal dispute had paved the way for partners to cast their investment net into Nigeria’s highly prolific deep waters with the potential for maximum returns.
First oil which is expected in 2021 or 2022 at 150,000 bopd, is estimated to peak at a production of 225,000 BOPD.