Green Energy International Limited, GEIL, operator of the Otakikpo marginal field in Oil Mining Lease, OML, 11 with operational base at Ikuru town, Rivers State, Wednesdayy, said it has commenced the execution of the second phase of its field development that would grow its crude oil output to 12,000 barrels per day.
In a statement in Abuja, the company stated that the full Otakikpo phase 2 development consists of drilling up to seven additional wells, expanding crude processing infrastructure up to 50,000 barrels of oil per day, BOPD, and the construction of 1.3 million barrels capacity onshore terminal.
The company added that the programme would also include the installation of a 17 kilometer export pipeline connecting the terminal to an offshore loading system.
According to the company, it is expected that the first piece of the development would, in the short-term, increase production to up to 12,000 bopd using ullage on existing infrastructure while the long-term would see Otakikpo production of up to 20,000 bopd and opportunities to aggregate production from other producers.
The company explained that this remarkable milestone was coming on the heels of the Field Development Plan (FDP) and Environmental Impact Assessment (EIA) approval granted to the company by the oil industry regulator, the Department of Petroleum Resources, DPR.
The company disclosed that together with her technical partner, Lekoil Oil and Gas Investments had proactively taken advantage of the Niger Delta dry season window to start the land reclamation exercise for its onshore terminal, flow station, and well sites.
It said, "Critical long-lead items for well construction have also been identified and ordered to meet the project 2020 drilling campaign timelines. The joint venture plans for the onshore terminal and expanded processing infrastructure are in line with its vision of making the Otakikpo field a crude processing and export hub for other stranded fields in the Eastern Niger Delta axis by providing a commercially viable and operationally efficient access to the export market.
"The Otakikpo development plan also reflects the JV Partners' confidence in the subsurface due diligence as reported in the CPR and the interpretation, by in-house analyst, of the 2019 field-wide 3D seismic data that significantly increased the field's booked reserves.
"The Otakikpo phase 2 field development was sanctioned in July 2019 with the signing of a Memorandum of Understanding (MoU), with a consortium of international firms, valued at $350million. The Consortium will also form multidisciplinary project management teams from Lekoil and GEIL."
Commenting on the milestone, Chief Executive Officer of GEIL, Professor Anthony Adegbulugbe commended the company staff and her technical partner, Lekoil, on maintaining world class operational excellence and safety performance in 2019.
He also reiterated the significance of continued collaborative efforts between the Joint Venture, JV, partners that would be instrumental in obtaining the required financing to increase production at Otakikpo.
He said, "This marks a major step forward for us and our partner, Lekoil, to fully develop the Otakikpo field. We are happy to see our asset moving forward into full development stage and generate significant cashflow."
The prolific Otakikpo field is located in a coastal swamp location in oil mining lease (OML) 11, adjacent to the shoreline in the south-eastern part of the Niger Delta.
The phase 1 of the field development commenced in 2014 by the JV between GEIL as operator and Lekoil as technical and financial partner.
The companies successfully re-entered two wells and attain steady production and export of c. 6,000 bpd (gross) from the asset since 2017. This has been done with the support of great host communities and innovative, world-class infrastructure.