Nigeria-Sao Tome JDA pitches Gulf of Guinea deepwater acreage

By OGJ editors
HOUSTON, June 18 -- The Nigeria-Sao Tome Joint Development Authority set meetings Thursday in London and Monday in Houston to elaborate on fiscal terms of production sharing contracts that apply to nine deepwater blocks on tender through Oct. 2 in the Gulf of Guinea.

The Nigeria-Sao Tome Joint Development Zone blocks lie in 3,000-10,000 ft of water west and north of Principe Island at roughly 1-3° N. Lat. and 4-8° E. Long. The 35,400 sq km zone is divided into 11 blocks, of which nine that cover a combined 9,500 sq km are up for tender.

The area, an extension of Nigerian deepwater geology, is believed to contain 6 billion boe in place by the JDA's estimate.

The closest discovery to the JDZ, 20 km north, is Total's Akpo in 1,390 m of water on Nigeria OPL 246, estimated to hold 500 million-1 billion bbl of oil. Also in proximity are Shell-Statoil's adjacent Nnwa and Doro finds in 1,280 m of water on OPLs 218 and 219, believed to contain 50 million bbl of oil and 10 tcf of gas (OGJ, Feb. 24, 2003, p. 48).

JDZ fiscal terms call for a $30 million signature bonus on each block. Other fiscal terms include a 50% tax rate, maximum 5% sliding scale royalty, and profit oil share based on an R factor.

Six companies had purchased datasets before the tender announcement, and more than 150 were signed up to attend the London program.

Nigeria and Sao Tome e Principe will share income 60-40 from the JDZ, which is valid for 45 years and subject to review after 30 years.

Western Geco acquired 3,500 km of 2D seismic data over the area in 1998, Veritas acquired 1,000 line km of 2D in the northern JDZ, and PGS acquired 3,000 sq km of 3D data. Data are to be available in July from a surface geochemical and heat flow study by TDI-Brooks International Inc., College Station, Tex.