WEST AFRICA

Fred Akanni
Lagos

• Elf's Block 17 and Exxon's Block 15 discoveries [40409 bytes].
• The controversial Block B.[71,088 bytes]

Nigeria: Final push for Canada

Canadian Occidental's (Canoxy) recent acquisition of substantial interest in deepwater and onshore acreages in Nigeria has finally hoisted the Canadian flag firmly on the Nigerian oil patch. The deals seal the seven-year-old, gradual entry of the country, beginning with small Canadian companies and Canoxy's hitherto minor stake in Africa's largest oil industry. Late in July, Canada's flagship oil company was granted 20% each in the Elf-operated deep offshore leases OPL 222 and 223, with partners Exxon and Chevron holding 30% each. Canoxy's 20% was obtained by a 50-50 split of Elf's 40% share. Canoxy also acquired, at the same time, 20% holding in Elf's inland leases 802, 804, and 807, in the less famous Benue Basin.

All of this is coming at a time when Canoxy is partnering with a consortium of companies to begin production of the offshore Ejulebe field in offshore Niger Delta. Ejulebe production is scheduled to begin next October. Canoxy is financing the production and it holds 20% in that small (20 million bbl of oil) field. The irony is that as Canada seems to be asserting a presence in Nigeria through Canoxy, another Canadian company is having troubles staying on. Abacan Resources, the small E&P independent from Calgary used to be the face of Canada in the Nigerian oil industry. But financing woes caused by reservoir problems has forced Abacan to terminate its relationship with Amni International in the production of the Ima field, located in shallow offshore southeast Niger Delta.

Abacan came to Nigeria seven years ago, when the Nigerian government opened up the oil industry to a massive indigenous participation. It offered technical services and funding for the new, inexperienced domestic entrants. Abacan took 40% in OML 302, 309, 237, and 469, the latter two being Amni's. At about the same time, a Canadian seismic processing company Pulsonic opened shop. Canoxy arrived later, as did Jerez, which hoped to exploit the country's large bituminous sands in the west.

Elf drills Ekanga-2 amidst controversy

Elf has successfully appraised the Ekanga-1 oil discovery (OML 102), the controversial well that was drilled on the offshore border between Nigeria and Equatorial Guinea. The French major is willing to develop the find. Ekanga-2, spudded in June and suspended in July, confirmed at least two oil reservoirs that have been previously encountered in Ekanga-1.

Ekanga-1 was controversial because of its location. Equatorial Guinea authorities claimed that the well was sited in Equatorial Guinea, precisely in Block B, where Mobil Equatorial Guinea is producing the Zafiro field. It is no longer a speculation that the Zafiro field straddles Nigeria and Equatorial Guinea and that the purpose of drilling Ekanga is in part to determine how much of the oil in the field belongs to Nigeria. The appraisal well Ekanga-2 is situated 4 km southwest of Ekanga-2, and therefore farther inshore and more firmly in Nigerian territory. Still, sources at the Department of Petroleum Resources say the reservoirs in Ekanga-2 are less well developed than in Ekanga-1. Does it mean that the field is better developed inside Equatorial Guinea than in Nigeria? Such questions are what will determine the terms of unitization (joint production of the field) by Nigeria and Equatorial Guinea. Elf regards the Ekanga wells as political wells and would not disclose the hydrocarbon column in either case.

Angola: Kiame now onstream

While the majors are basking in the successes of their potentially huge deepwater finds, the American independent Ranger has quietly brought the small (8 million bbl of oil) Kiame field onstream. Ranger completed Hakuryu V Kiame 1STX horizontal multilateral development well at the end of May. The Kiame field, in 142 meters water depth, has a daily production of 7,000 b/d of oil. This will provide part of the finances for Ranger to carry out its work program in Cote d'Ivoire, where it looks to be the most important company, operating three offshore leases CI 40, CI 101, and CI 103.

Two new strikes in Angolan waters

Elf and Exxon, riding the crest of a wave of successes in Angola deepwater drilling, were on their way to new oil discoveries in early August.

• Elf was testing Lirio 1, in 1,392 meters water depth in Block 17, after drilling to 10,260 ft.
• Exxon was also testing Dikanza-1, drilled in 1,143 meters water depth in Block 15, after reaching at 8,960 ft TD, a clear 60 ft shallower than proposed.

Both wells targeted the Malembo formation. The locations of the two wells are far apart from the closest wells in their respective leases. The closest well to Lirio on Block 17 is Rosa, which is 15 km away to the southeast. The closest well to Dikanza-1 in Block 15 is the much heralded Hungo-1, which lies 13 km northeast. This is a strong hint that the leases may be almost entirely filled with oil.

The Gambia: new to the game

The West African oil and gas industry has welcomed a new player - The Gambia. The Gambia has awarded Planet Oil and Balmain Resources the first offshore petroleum production license covering 12 exploration areas in Block A and eight areas in Block B. The agreement requires the companies to conduct new geophysical surveys and seismic processing during the initial year of the contract and to drill a well during the second and third year.

Copyright 1998 Oil & Gas Journal. All Rights Reserved.