Erha North Phase 2 has started oil production ahead of schedule

Nigeria’s oil production capacity is expected to rise by additional 200,000 b/d by the fourth quarter 2017 when two major deepwater fields will have come on stream, amid local and international challenges facing the oil industry, state oil firm Nigerian National Petroleum Corp said.

The increased production will come from ExxonMobil’s Erha North field and Total’s Egina oil field, whose investment decisions were taken in 2014, Jonathan Okehs, general manager of National Petroleum Investment Management Services (NAPIMS), the investment arm of the NNPC, said in a message to employees published Friday.

“At the beginning of 2014, amidst global economic uncertainties, we set ambitious and laudable targets for ourselves. Investment decisions for other deep-water projects like Egina and Erha North have been taken with expected production of 200,000 b/d in the fourth quarter of 2017,” Okehs said.

The Erha North field is located in Oil Mining Lease (OML) 133 with reserves estimated at 177 million barrels, while the Egina field is located in OML 130 near the Akpo field.

Okehs said that despite the challenges that were heightened by the slump in global oil prices, new fields were had been put on stream in Nigeria in 2014, including Shell’s Bonga North deepwater field, which added 50,000 b/d to output capacity and Chevron’s Escravos Gas-to-liquid plant in the Niger Delta.
However, Okehs said continued sabotage attacks on pipelines and crude theft combined to limit Nigeria’s crude oil and condensate production to an average of 2.037 million b/d in 2014, compared with the targeted level of 2.38 million b/d, but marginally higher than the 2013 average of 2.029 million b/d.

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Nigeria’s oil reserves have fallen as ageing fields pass peak production and investment in new projects slows after Nigeria continued to dither in implementing promised reforms as contained in the long delayed Petroleum Industry Bill.

Oil industry officials said widespread corruption and risks associated with oil theft and piracy are also making investing less attractive. Besides robbing the country of an estimated $6 billion/year in lost revenue, oil theft causes pipeline shutdowns since thieves often sabotage lines before tapping the crude.

Okehs said Nigeria maintained gas supply of 3.0 Bcf/d to the Bonny LNG plant and around 800 MMcf/d of gas to the domestic market last year.

“We also ensured the supply of gas to independent power plants, thus supporting stable power supply to Nigerians and reducing gas flares,” he added.

Culled from Platts.com