16 May 2017

Nigeria: Agip to Contribute Two Discoveries to Marginal Fields Bid Round

Facts have emerged that for the first time ever, undeveloped discoveries in Nigerian Agip Oil Company operated acreages may be awarded as marginal fields.

Vanguard learnt that two accumulations operated by the company are likely to be part of about 40 fields expected to be on offer, when the Nigerian government launches the much awaited marginal fields bid round later in the year.

Sources in Agip, confirmed that preliminary data from two of the company's operated undeveloped discoveries are in the "bid basket" of the Department of Petroleum Resources, DPR, the government agency responsible for conducting the bid round.

Agip was said to have been unable to "participate" in marginal field awards since the exercise formally began in 2002 because, among all the international oil companies, IOCs, it has the least prospective acreages in Nigeria, especially onshore, where the bulk of undeveloped discoveries referred to as marginal fields are located.

Three out of the five major IOCs operating in Nigeria contributed fields in their acreages to the basket, during the landmark 2002/2003 marginal field bid round.

ExxonMobil did not contribute any field in those awards but has, in the past 15 years since then, given up two marginal fields, Okwok and Ebok to the Nigerian government, to help boost indigenous capacity.

Outside the 2002/2003 awards, Shell has contributed two more marginal fields.

Unconfirmed sources told Vanguard that the marginal field round is expected to be declared open latest September 2017.

It was learnt that the companies for the bid round would be expected to demonstrate technical ability with regard to the evaluation and development of the assets, access to funding or evident relationship with a technical partner with adequate financial resources to operate the assigned field.

Marginal fields in Nigeria are undeveloped discoveries, located in acreages held by oil majors operating in the country. 24 such fields were awarded in 2003, to 31 Nigerian independents.

Four more have since been granted, outside the process of a bid round, since then.

Speaking at the just concluded Offshore Technology Conference, OTC, at Houston, Texas, the Minister of Petroleum Resources, Dr. Ibe Kachikwu, assured that the process for the bid round will commence this month.

"My understanding is that by the end of May, we should have all the data that we need. We have identified about 40 - 45 marginal fields. We are not contemplating the major oil mining leases, OMLs right now. OMLs renewals, yes, we have already sent out letters on those for existing OMLs but in terms of issuing new blocks, we are probably not contemplating that for the rest of this year. But marginal fields we will deal with," he added.

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