Market Report: BP signs offshore deal in Gambia
Dr. Maikanti Baru, Group Managing Director, Nigerian National Petroleum Corporation (NNPC), disclosed at the 2019 Offshore Technology Conference (OTC) that Nigeria’s deep-water operations have generated over $180 billion following a capital investment of more than $65 billion made by players in the oil and gas industry.
Dr. Baru also disclosed that the country has utilised each deep-water project as an avenue to upscale its unique human capital skills and that the NNPC would continue to support planned deep-water projects while ensuring adequate local participation.
He added that the corporation will strive to acquire seismic data using 2D, 3D, 4D and use new technology to reduce the cost of crude oil production for economic development. GHANA Eni announced it had made a gas and condensate discovery with its first exploration well in the Offshore Cape Three Points (OCTP)-Block 4 offshore Ghana, which if developed would help maintain production rates at the existing Sankofa production hub.
The Akoma-1X well found estimated volumes of between 550 – 650 Bcf (16-18 Bcm) of gas and 18-20 million barrels of condensate. Eni said: “The discovery has a further additional upside for gas and oil that will require further drilling to be confirmed.”
Eni already produces oil and gas from the OCTP license, home to the Sankofa production hub.
Gas is piped from the hub to an onshore receiving terminal and used domestically in Ghana. The Akoma-1X well is about 12km northwest of Sankofa where the John Agyekum Kufuor Floating, Production, Storage and Offloading vessel is located. The well was drilled in a water depth of 350m and reached a total depth of 3,790m.
It proved a single gas and condensate column in a 20m thick sandstone reservoir interval. Eni is the operator of the CTP-Block 4 with a 42.469 percent stake. Its partners are Vitol (33.975 percent), state-owned GNPC (10 percent), Woodfields Upstream (9.556 percent) and Explorco (4 percent). Eni’s gross production in Ghana is currently some 60,000 barrels per day (bpd) equivalent.
BP signed an offshore exploration deal with the Gambian government to explore offshore hydrocarbons potential in the West African nation. The Ministry of Petroleum and Energy of The Gambia announced the official licensing of Offshore Block A1 to BP.
The Gambian President, Adama Barrow, in a statement, said that BP has “the legal rights” to explore for oil and gas potential in block A1 offshore Gambia. Block A1 and A4 were previously under an African Petroleum Corporation license, which was annulled by President Adama Barrow’s government in 2017, after expiry.
The two blocks are said to contain up to 3 billion barrels of oil and rest just south of Senegal’s SNE find. Given Senegal’s successful exploration campaigns from 2014 to date, Gambia hopes to attract international oil and gas players in its six offshore blocks.
According to BP, it could take close to a decade for the Gambia to receive revenues if exploration efforts are successful.
On Thursday May 9, oil prices held steady as reports that OPEC is keeping supply tight outweighed risk-off sentiment stemming from Sino-U.S. trade uncertainty. The U.S West Texas Intermediate crude futures were nearly a dollar up from Wednesday’s lows at $62.13 a barrel by 7:16 AM ET (11:16 GMT), while Brent crude futures edged forward 22 cents to $70.59.
The U.S. Energy Information Administration (EIA) said in its weekly report that crude oil inventories slumped by nearly 4 million barrels in the week ending May 3, as against forecasts for a build of 1.2 million barrels. A survey from S&P Global Platts showed that OPEC’s collective production held relatively steady in April.
After four months of declines, output rose by just 30,000 to 30.26 million bpd. The survey showed that production levels among members varied, with Saudi Arabia producing at a 15-month low, while Iran’s output fell to levels that were even lower than at previous times when it was under U.S. sanctions.
Despite large increases in output from Iraq and Nigeria, compliance with the output restraint agreement was 116 percent for the 11 members with quotas. Reuters also reported that Saudi Arabia and other Gulf producers would satisfy requests for oil from countries that can no longer buy from Iran because of the latest U.S. sanctions, but added that Saudi output will stay below the officially agreed limit through June and that exports would remain below 7 million bpd.