In line with President Bola Ahmed Tinubu’s directive to the Nigerian National Petroleum Company Limited (NNPCL) to optimise production from the nation’s oil and gas assets, the company on Wednesday, announced the successful commencement of oil production from the Akpo West Field.
A statement from the Chief Corporate Communications Officer, NNPC Ltd, Mr. Olufemi Soneye, explained that the milestone, which was the result of meticulous planning, strategic collaboration, and unwavering dedication from all stakeholders involved in the project, would add 14,000 barrels per day condensate to the nation’s production.
This, he said would be followed up by the production of about four million cubic meters of gas per day by 2028.
“The development of Akpo West which is on Petroleum Mining Lease (PML) 2 (formerly OML 130) leverages the existing Akpo Floating Production Storage and Offloading (FPSO) facility via a subsea tie-back to keep costs low and minimize greenhouse gas emissions.
“The milestone was enabled by the strategic leadership of the Group Chief Executive Officer (GCEO), Mr. Mele Kyari, and the Upstream Directorate of the NNPC Ltd whose support played no small role in propelling the operators to actualise the short- and mid-term hydrocarbon production goal of the President Tinubu administration,” Soneye added.
Located 135 kilometres offshore, Akpo West is one of the discoveries on PML 2 with proximity to the Akpo main which started up in 2009 and produced 124,000 barrels of oil equivalent per day in 2023.
PML 2 is operated by TotalEnergies with a 24 per cent interest, in partnership with CNOOC (45%), Sapetro (15%), Prime 130 (16%), and the NNPCL as the concessionaire of the Production Sharing Contract (PSC).
In terms of volume, the development represents progress for Nigeria which has been unable to raise production markedly for at least four years.
In a separate statement from the French headquarters, of TotalEnergies, obtained by THISDAY, the multinational further stressed that by mid-2024, Akpo West would add 14,000 barrels of condensate production per day, to be followed by up to 4 million cubic meters of gas per day by 2028.
Condensate falls outside the Organisation of Petroleum Exporting Countries (OPEC) monthly computation for member countries’ oil production.
The Akpo West development, the statement said, leverages the existing Akpo facilities to keep costs low and minimise greenhouse gas emissions.
According to TotalEnergies, the project’s carbon intensity is expected to be below 5 kg CO2e/boe and will contribute to reduce the average carbon intensity of TotalEnergies’ portfolio.
“After Ikike in 2022, TotalEnergies is pleased to start production of another tie-back project in Nigeria, Akpo West, which will contribute to maintaining the production of the existing Akpo facilities by developing additional nearby resources.
“This project fits the company’s strategy of developing low-cost and low-emission projects”, said the Senior Vice President Africa, Exploration and Production at TotalEnergies, Mike Sangster.
“This project leverages TotalEnergies’ solid footprint in Nigeria and will quickly bring value to the country, TotalEnergies and its partners, ” Sangster added.
TotalEnergies said it has been present in Nigeria for more than 60 years and employs today more than 1,800 people across different business segments.
“Nigeria is one of the main contributing countries to TotalEnergies’ hydrocarbon production where the company produced 219,000 boe/d in 2023. TotalEnergies also operates an extensive distribution network which includes about 540 service stations in the country.
“In all its operations, TotalEnergies is particularly attentive to the socio-economic development of the country and is committed to working with local communities,” the oil company stated.
Also, TotalEnergies announced on Wednesday that for the whole of 2023 its adjusted net income fell 36 per cent to $23.2 billion as oil prices fell back from the peaks hit in 2022 at the beginning of Russia’s invasion of Ukraine.
The French oil firm said it expects net investments of $17 billion to $18 billion for 2024, of which $5 billion will be dedicated to its integrated power section.
The report saw the international oil company (IOC) post a bigger-than-expected decline in its adjusted income for the fourth quarter of 2023 and warned weak refining margins would impact its 2024 results.
In the financial statement released on Wednesday, the French group’s net adjusted income dropped by 31 per cent to $5.2 billion from $7.6 billion in the same quarter a year earlier.
Chief Executive Officer of TotalEnergies, Patrick Pouyanne said the group expected a return of about 10 per cent on its integrated power sector for 2024, stressing that a third of investments set aside for 2024 will be dedicated to new petrol and gas projects.
Pouyanne also said the company was, “reactivating” the financing with its partners for a Mozambique project and was hopeful the project would return to production by mid-year.
TotalEnergies said it plans to increase interim dividends by 6.8 per cent to 0.79 euros per share and to buy back $2 billion of shares in the first quarter of 2024. That would be the base level for quarterly buybacks “in the current environment”, the company said.
For 2023, TotalEnergies proposed a dividend of 3.01 euros per share, up 7.1 per cent from 2022.
Besides, the oil and gas group recorded quarterly adjusted core earnings (EBITDA) of $11.7 billion, down 27 per cent year-on-year, and production of 2.483 million barrels per day (bpd), down 12 per cent year-on-year.
On its outlook for this year, it said: “At the start of 2024, Brent prices are navigating around 80 $/b in an uncertain economic environment. Oil markets are facing geopolitical tensions in the Middle East on one hand and non-OPEC production growth balanced by OPEC+ policy on the other hand.
“First quarter 2024 expected hydrocarbon production should be above 2.4 Mboe/d due to the start-up of Mero 2 in Brazil and the disposals of Canadian upstream assets, effective during fourth quarter 2023.
“In 2024, TotalEnergies expects net investments of $17 billion- $18 billion, of which $5 billion (will be) dedicated to integrated power.”
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