NNPCL, TotalEnergies Sign $550m FID On Ubeta Gas Field

 

The Nigerian National Petroleum Corporation Ltd, and the operator of OML 58 onshore license in Nigeria with a 40 per cent interest, TotalEnergies, have signed a $550m Final Investment Decision (FID) for the development of the Ubeta gas field.

Located about 80 km northwest of Port Harcourt in Rivers state, the OML 58 licence contains two fields currently in production, the Obagi oil field and the Ibewa gas and condensate field. OML 58 gas production is processed in the Obite treatment centre and supplied to both the Nigerian domestic gas market and to Nigeria LNG (NLNG) plant.

NNPC and TotalEnergies signed the agreement on Thursday in Abuja.

Also located in OML58, the Ubeta gas condensate field will be developed with a new 6-well cluster connected to the existing Obite facilities through an 11 km buried pipeline.

Production start-up is expected in 2027, with a plateau of 300 million cubic feet per day (about 70,000 barrels of oil equivalent per day including condensates).

Gas from Ubeta will be supplied to NLNG, a liquefaction plant located in Bonny Island with an ongoing capacity expansion from 22 to 30 Mtpa, in which TotalEnergies holds a 15 per cent interest.

Ubeta is a low-emission and low-cost development, leveraging OML 58’s 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 NNPCL to enhance local content, with more than 90 per cent of man-hours which will be worked locally.

Speaking at the event, Group Chief Executive Officer (GCEO) of NNPC, Mele Kyari, said on stream, the Ubeta project will produce about 350 million standard cubic feet (MMScf) per day of gas and 10,000 barrels per day of associated liquids.

This, Kyari said, is an opportunity to tap into the vast gas reserves and contribute towards securing gas supply to Nigeria’s liquified natural gas (LNG).

“I’m very convinced that many more projects will come alongside this as we progress,” Kyari said.

“And maybe not the right moment to make those announcements, but I know that a number of projects have been enabled by the executive order of Mr. President.

“No doubt, this project will create opportunities, jobs, and everything that you can imagine, including making our energy investment much more productive.

“I know for sure that the engagements with our other partners will ensure delivery of gas sufficient to keep our train 1 to 7 active and at full capacity, and also realise our ambitions for train 7.”

While appreciating the support from stakeholders, Kyari highlighted the continuous support of President Bola Tinubu’s administration in facilitating a conducive operational environment, which he said is a major driver of the deal.

He also said the presidential executive order was instrumental to achieving the milestone and the impact of the policy is being seen.

In his remarks,  senior vice president Africa, exploration and production, TotalEnergies, Mike Sangster, said he is pleased that the firm can launch the gas project which has been made possible by the government’s recent incentives for non-associated gas developments.

“Ubeta is the latest in a series of projects developed by TotalEnergies in Nigeria, most recently Ikike and Akpo West,” Sangster said.

“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.”

“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”, said Sangster.

Also speaking, Minister of State for Petroleum Resources (oil), Heineken Lokpobiri, said the president has significantly rekindled investor confidence in the oil and gas industry.

He assured Nigerians that more investments are on the way.

“One of the biggest challenges we faced on assumption is lack of investment and trust in the Nigerian policies in the last 12 years,” Lokpobiri said.

“I’m very happy to state that in the last nine month we have changed the narrative. I assure Nigerians that the good old days will be restored by creating an environment that is competitive and continues to attract investments.”

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