Schlumberger FID in Nigeria Delayed
A Nigerian upstream project that was to count Schlumberger as a co-investor is months behind in taking sanction.
The tripartite agreement between the state producer Nigerian National Petroleum Corporation (NNPC), the Nigerian independent First Exploration & Production (First E&P), and US-French services giant Schlumberger to develop the Anyala and Madu fields on licences OML 83 and OML 85 offshore Nigeria has been delayed. Parties to the agreement are not forthcoming about the reason.
When the partnership was set up in June 2017, the trio agreed to take a final investment decision by December 2017. However, almost a year after their agreement, the investment has not been sanctioned.
First E&P says it holds a 40% interest in the licences and is the operator of the asset, having acquired them from Chevron, while NNPC holds the remaining 60%. Under its agreement with both firms, Schlumberger was to invest up to $700mn to develop the fields, which hold over 800bn ft3 gas as well as oil. The deal was based on a guaranteed project return, including a payment assurance bank facility.
An industry insider, who spoke on the matter anonymously, said since the parties involved in the deal had still not taken a final investment decision at this time, it was impossible to meet the target, previously stated by NNPC last June, of producing 50,000 b/d and 120mn ft3/d by early 2019.
Resources initially in place are estimated at 739bn ft3 gas and 89mn bbls oil on Madu field (OML 85) and 175bn m3 gas and 218mn bbls oil on Anyala (OML 83).