Undeveloped oil block owners get March 2015 deadline
Owners of marginal fields or oil blocks that are not yet fully operational risk takeover by the Federal Government, as they have until March 2015 to make them operational or forfeit them.
Some of these affected oil blocks located along the Niger Delta creeks and environs have been lying idle for years since they were awarded as a result of lack of funds to commence operation.
A document obtained exclusively by our correspondent from the Public Affairs Unit of the Department of Petroleum Resources (DPR) showed that operators of the oil blocks have delayed take-off due to their inability to access funds, difficulty in agreeing to operational synergies with International Oil Companies (IOCs), the increasing cost of labour, goods and service, technology limitations and community problems.
The DPR however noted that 'At present, there is no marginal field that is yet to be developed. Apart from the producing fields, all other marginal fields are at various stages of field development aimed at bringing the fields to production. These fields have witnessed one form of field developmental activity or the other since the time of award, so they are still being developed.'
The developing marginal fields and their owners include: Atala, being managed by the Bayelsa Oil & Gas Ltd; Ogedeh, owned by Bicta Energy System; Ke, by Del Sigma Ltd; Dawes Island owned by Euroafric Energy Ltd; Ororo owned by Guarantee Petroleum & Owena and Gas Ltd.
Others are Omerelu, being managed by Niger Delta Pet. Resources; Ofa, owned by Independent Energy Ltd; Eremor, by Excel Expl. & Prod. Ltd; Amoji/Matsogo/Igbolo, by Chorus Energy; Assaramatoru, by Prime Energy; Tom Shot Bank, jointly owned by Associated Oil & Gas and Dansaki Pet. Ltd; Tsekelewu, both owned by Sahara Energy Ltd and African Oil & Gas and Qua Ibo, owned by Network E & P.
Marginal fields still nearing production operation are: Akepo, owned by Sogenal Ltd; Stubb Creek, by Universal Energy Res. Ltd; Oza, by Millennium Oil & Gas and Ekeh, being managed by Movido E & P respectively.
The DPR is however optimistic that the March 2015 deadline is enough time for those companies yet to bring their marginal oil fields into production to do so.
Spokesperson for the DPR, Mrs Selema Osibodun said: 'The deadline for the companies to bring the fields to production is March 2015. There is still enough time within this period for the companies to bring the fields to production.'
As to whether the DPR will grant further extension to the deadline, Osibodu said that could only be decided by the Federal Government.
'Extension of marginal field period is done by the Federal Government of Nigeria and not DPR. Therefore the DPR is not in a position to comment on extension at this time,' she stressed.
Investigation by The Nation revealed that there are 200 marginal oil fields in the Niger Delta Basin with a maximum reserve base of about five billion barrels of oil.
There were 26 companies involved in marginal oil fields, many of which partnered international companies to provide technical expertise and finance. They are Associated Oil & Gas Limited; Bayelsa Oil Company Limited; Bicta Energy Management Services Limited; Brittania U-Nig Chorus Energy Dansaki Petroleum; Unlimited Del Sigma Energie Eurafric Energy Limited; Excel Frontier Oil Limited and Goland Petroleum Development Co. Limited.
Others are Guarantee Petroleum Limited; Independent Energy Limited; Midwestern Oil & Gas; Millenium Oil & Gas Limited; Movido Exploration & Production Limited; Network Exploration & Production Limited; Niger Delta Petroleum Resources Limited; Pillar Oil Limited; Platform Petroleum Limited; Prime Exploration & Production; Sahara Sogenal Limited; Universal Energy Resources Limited and Waltersmith Petroman.
Besides, only a few of the 77 oil blocks awarded to oil firms in 2005 have even started production.
It is estimated that a marginal field in the Niger Delta Basin will cost about $50 to $80 million as development cost for a few years. Foreign technical or financial partners will in most cases contribute 40 per cent of this amount.
Already, the Federal Government has extended the farm-out date of the non-producing marginal fields by four years with effect from 2011 to enable the companies to address their challenges and bring the fields into production. The Nation