Nigerian independent details his country's E&P prospects

In the future, Nigeria's marginal field exploration and production licenses are expected to be awarded only to indigenous oil companies or to joint ventures of foreign oil companies with indigenous firms.

Yinka Adeyemi, general manager of Nigeria's Spectrum West Africa, said many of these indigenous companies are primarily concerned with other industries and are seeking foreign partners to provide not only funding for E&P work but also expertise.

Adeyemi told delegates attending the Offshore West Africa conference in Abidjan, Ivory Coast, on Mar. 23 that 46 indigenous oil companies currently have 55 permits in Nigeria's onshore and offshore areas.

Indigenous firms' activity

Five indigenous companies have deepwater licenses off Nigeria, and of these, four have signed joint-venture agreements with foreign partners. Under legislation introduced in 1996, the foreign partners can take up to 40% in the projects, while there is no requirement for state participation.

These marginal licenses were awarded under 5-year permits, with operators committed to acquiring a minimum of 1,000 line-km of 2D seismic data and drilling at least three wells.

So far, the indigenous companies have notched up 10 discoveries-although almost all with outside help. Adeyemi said further such opportunities for outside firms are anticipated, because the government is committed to privatizing Nigeria's oil industry. Nigeria's Allied Energy was the first of the deepwater license holders to strike oil, with the Oyo-1 well drilled on the OPL 210 license in 1995. BP Amoco plc and Statoil AS are license partners here, but discussions are said to be at an advanced stage

over equity buy-back. The find was made in 315 m of water and has estimated reserves of 50 million bbl of oil.

The other deepwater find by an indigenous company was Ajbani on the OPL 216 license, where Famfa Oil is the operator and Star Deepwater, a subsidiary of Texaco Inc., is the joint venture partner.

The Agbani-1 well was drilled in October 1998 in 1,453 m of water. It cut 424 m of net oil pay, although no figure for estimated reserves is available yet.

Adeyemi said Nigeria is thought to have 200 marginal fields to be found and developed, with an estimated combined reserves of 800 million bbl of oil.