Shelf Drilling Secures $60m Contract to Expand Oil Exploration in Nigeria

The oil and gas sector in Nigeria is set to get a boost, with Shelf Drilling, a key player in the global industry, getting a new award in the country that will see it drill 10 additional oil wells in the Niger Delta in one and a half years.

Shelf Drilling is headquartered in Dubai with locations in Southeast Asia, India, West Africa, Egypt, Saudi Arabia, and Italy, and a sole focus on shallow water drilling.

The firm announced at the weekend that new awards for two jack-up rigs in West Africa had been secured, in direct continuation of the rig’s current campaign in Nigeria with a contract value of $60 million.

In addition, the company stated that it secured a letter of award for the Shelf Drilling Achiever for a multi-year campaign scheduled to commence in October 2024. It said it expected to execute a contract for this programme in the very near-term.

Recently, Chief Executive Officer of Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Gbenga Komolafe, disclosed that the country’s oil rigs had increased to 30, from 11 in 2011.

Komolafe linked the increase to NUPRC and other government stakeholders’ efforts to attract confidence and certainty into the oil and gas industry.

He said, “The country now has about 30 rigs in its upstream oil and gas sector, against 11 active rigs in 2011.

“That is a huge success for us, and you know that rig count is a measure of vibrant activities in the oil industry. We have been able to attract confidence, certainty, and predictability into the industry.

“If you check, we’ve attracted capex going into billions of dollars into the Nigerian upstream. So, gradually, we are happy that we have success stories to tell just in about less than two and half years.”

The oil rig count refers to the number of active drilling rigs extracting oil from the ground at a given time. It is an important metric in the oil and gas industry, as it provides insight into the level of drilling activity, which can influence oil production levels and market dynamics.

Shelf Drilling, in an online statement, said its Shelf Drilling Achiever rig was currently being mobilised to  the West African country on a dry transport carrier, expected to arrive before the end of September 2024.

Concurrently, Shelf Drilling said it was mobilising the Main Pass IV rig using the same dry transport carrier, and the rig was also expected to commence operations before the end of 2024. It is coming months after the organisation said it was undertaking drilling activities offshore Nigeria over the period of 16 and 8 months, respectively.

The combined, estimated contract value for the two rig deals, it announced in October last year, was approximately $93 million, excluding revenues for mobilisation and demobilisation.

The statement said, “Shelf Drilling, Ltd announced today new awards for two jack-up rigs in West Africa. Shelf Drilling has secured a contract for the Shelf Drilling Mentor covering 10 wells and an estimated duration of 450 days in direct continuation of the rigs’ current campaign in Nigeria with a contract value of $60 million.

“In addition, the company secured a letter of award for the Shelf Drilling Achiever for a multi-year campaign scheduled to commence in October 2024. The company expects to execute a contract for this programme in the very near-term.

“The Shelf Drilling Achiever rig is currently being mobilised to West Africa on a dry transport carrier, expected to arrive before the end of September 2024. Concurrently, Shelf Drilling is mobilising the Main Pass IV rig using the same dry transport carrier, and this rig is also expected to commence operations before the end of 2024.”

Chief Executive Officer of the Dubai firm, Greg O’Brien, stated that the new award will help the company build on its leading position in West Africa and demonstrate the strength of the market.

O’Brien said, “We are very pleased with these two awards, which build on our leading position in West Africa and demonstrate the strength of this market.

“These awards further support our decision to mobilise the two rigs from the Middle East, and we are confident that operations for the Main Pass IV will also commence shortly after the rig’s arrival.”

Meanwhile, the Nigerian National Petroleum Company Limited (NNPCL) and China Engineering and Machinery Corporation (CMEC) had signed a Memorandum of Understanding (MoU) for the co-funding of the Gwagwalada Independent Power Plant (GIPP) Phase-1 Project.

NNPCL’s Executive Vice President, Gas Power and New Energy, Mr. Olalekan Ogunleye, and Chairman of CMEC Nigeria, Mr. Zhang Daguang, signed the agreement on behalf of their respective companies, a post on the NNPCL’s X handle stated.

Also known as the Abuja IPP, the 350MW GIPP Phase 1 Project is one of the key anchor projects of the Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline Project, which NNPCL said is in line with Nigeria’s Gas Master Plan infrastructure blueprint.

Upon completion, the GIPP Phase 1 Project is expected to improve power generation, create job opportunities, reduce gas flaring, and engender industrial development, the national oil company stated.

In August last year, President Bola Tinubu performed the ground-breaking ceremony of the first phase of the Total NNPC 1,350 MW Gwagwalada plant, situated on 547 hectares of land in the Federal Capital Territory (FCT), Abuja.

Emmanuel Addeh

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