TotalEnergies’ discovery at Ntokon in Nigeria’s is the country’s “biggest shallow water discovery in a decade” according to Wood Mackenzie.
Director of upstream research Gail Anderson hailed the find. She said the discovery showed there was “still plenty of running room in the shallow water Niger Delta”.
The consultancy estimates the Ntokon field could hold 300-400 million barrels of oil equivalent. It drew analogies with other shallow water discoveries in the Niger Delta’s Tertiary Agbada formation and “above-average recovery from high quality reservoirs”.
Anderson said, based on 320mn boe of reserves, a development could involve up to 30 wells and a multi-phase pipeline to Ofon.
Total, the operator with a 40% stake in OML 102, could reach first oil in 2029, she said. Ofon is 20 km to the northeast, on the same block.
“This would generate a healthy IRR of 24%, based on the current concession terms”, she said. This would involve not converting the licence to fall in line with the new Petroleum Industry Act (PIA) fiscal terms.
Nigerian National Petroleum Corp. (NNPC) owns the remaining 60% stake in the licence.
ILX plans
Using the Ofon facilities would reduce emissions and gas exports would allow the project to avoid flaring.
“This demonstrates the advantages of shorter-cycle tie-backs over more expensive stand-alone developments for both cost savings and lower emissions,” said Anderson.
“However, there are challenges. Nigeria is not known for short lead-times, particularly where JV projects are concerned. Ntokon will provide a test in the face of stiff global competition to see if all interested parties could quickly progress lower-cost, lower-carbon projects and allow Nigeria to kick-start desperately-needed investment and recover its declining production.”
Welligence Energy Analytics said there were other tie-back candidates to Ofon, including the Etisong and Etisong North finds. Total, Welligence said, is “building a pipeline of such opportunities across its offshore portfolio in Nigeria”.