Nigeria among largest deepwater oil producers — Report

In addition to Brazil and the United States, Nigeria, Norway and Angola are the largest deepwater producers, a new report has revealed.

Global deepwater oil production is expected to grow by 700,000 barrels per day this year to hit a record high of more than 10 million bpd, according to a Norwegian research group, Rystad Energy.

Nigeria’s oil and gas production structure is majorly split between joint ventures onshore and in shallow water with foreign and local companies and production sharing contracts in deepwater offshore, to which many international oil companies have shifted their focus in recent years.

Total’s Egina deepwater oilfield recently achieved first oil production, helping to push the country’s oil output beyond 2.09 million bpd in December.

The French oil major said the field, which is located in around 1,600 meters of water depths, 150 kilometres off the coast of Nigeria, would produce 200,000 bpd at plateau.

Shell Nigeria Exploration and Production Company said in December that its Bonga vessel had produced over 800 million barrels of crude oil in 13 years of deepwater exploration.

The Bonga field, which began producing oil and gas in 2005, was Nigeria’s first deepwater development in water depths over 1,000 metres.

With a number of large fields starting up in Brazil and US Gulf of Mexico, deepwater liquid production will reach 10.3 million bpd in 2019, Rystad said on Friday.

It said Brazil, US, Nigeria, Norway and Angola would continue to be the largest deepwater producers.

Deepwater projects have attracted nearly half of global exploration investment over the past decade and have delivered a similar share of new production volumes, according to S&P Global Platts.

As global oil production from maturing shallow water areas such as the North Sea declines, new offshore volumes were expected to become increasingly reliant on flows from deepwater fields.

The International Energy Agency has estimated that the share of deepwater in total offshore production will rise to 30 per cent in 2040, from 23 per cent currently.

Brazil will be by far the largest source of future deepwater growth, the IEA estimated, by nearly doubling its current output by 2040.

Last month, UK energy consultancy Wood Mackenzie predicted that total annual deepwater capital expenditure would rise to nearly $60bn by 2022 from around $50bn currently.
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