Deepwater volume growth remains strong in West Africa. According to analysts at PFC Energy, West Africa dominates the international deepwater market and will see over 40% of the $48 billion in deepwater exploration spending in 2005-2009. PFC’s numbers indicate that over the coming five years, West Africa will account for approximately 43% of all expenditure. The region makes up 51% of the deepwater market this year.
West Africa is also the largest projected growth area for FPSOs and subsea systems worldwide over the next five years. According to Infield Systems, Angola and Nigeria will see the most subsea activity, with deepwater projects being the major driver of growth during that period.
Deepwater projects accounted for 53% of the subsea market expenditure over 1999-2003, but Infield expects this number to rise to 75% during 2004-2008. Equally significant is the prediction that considerable expenditure will continue beyond the forecast period.
According to Infield, the African region has been the major frontier for developing the subsea market. Infield points to Total’s Dalia field, which is to have over 60 subsea units, as indicative of the area’s significance in terms of subsea development.
Several large projects are moving slowly into production. The Dalia, Greater Plutonio, and Kizomba projects will impact expenditure this year, though Greater Plutonio is not scheduled to go onstream until 2007. While these fields move into production, exploration is beginning in new areas.
The Joint Development Authority (JDA) for blocks in the area shared by Nigeria and São Tomé & Príncipe recently concluded its bidding round. The round elicited 26 bids from 23 companies for five oil blocks. The bids could generate $433 million in signature bonuses alone and will spawn exploration activity in a frontier area of Africa’s offshore.
Another impetus for renewed drilling is Nigeria’s push for increased offshore exploration, officially announced early this year. The country is actively encouraging more offshore drilling to compensate for a drop in onshore production numbers.
Gas-to-liquids (GTL) production is also set to take off offshore Nigeria. In early January, Syntroleum Corp. finalized agreements that position it to begin appraisal of the Aje discovery in Oil Mining Lease 113. Syntroleum has assembled technical assistance for the project through agreements with a number of companies. Together, the group will carry out terms of the Joint Venture Agreement between Syntroleum and Yinka Folawijo Petroleum Co. Ltd.
The group expects that Aje, a previously discovered oil and gas accumulation, will be ideal for applying Syntroleum’s marine based GTL technology. Syntroleum believes the Aje-3 well has the potential to confirm large commercially viable crude oil and condensate volumes as well as natural gas reserves sufficient for Syntroleum’s marine GTL installation.
Syntroleum owns a proprietary GTL process for converting natural gas or synthesis gas into ultra-clean synthetic liquid hydrocarbons. The company plans to use its technology, as well as other third-party gas processing technologies, to develop and participate in gas monetization projects in several global locations. If the project proceeds as anticipated, Nigeria will see the first floating GTL operation in the world.
Angola will see yet another first for the region. The hook-up of the industry’s first liquid petroleum gas (LPG) FPSO is set to take place offshore Angola later this year. ChevronTexaco Corp. will employ theSanhaFPSO on the Sanha Condensate project in block 0. First LPG production from the LPG FPSO should take place in 2Q.
Hungo (Kizomba A - block 15) Angola
In early August 2004, Exxon Mobil Corp. subsidiary Esso Exploration Angola Ltd. started production of the $3.4-billion Kizomba A project, the largest deepwater development offshore West Africa. The company estimates recoverable resources of 1 Bbbl, with an expected production rate of 250,000 b/d.
“Kizomba A employs the world’s largest FPSO, and the start-up of this project is an important milestone in Angola,” Harry J. Longwell, director and executive vice president, ExxonMobil, says.
Kizomba A is the first of three world-class production developments on block 15 that are intended to collectively develop over 2.5 Bbbl of oil at a total investment of around $10 billion. Located 230 mi northwest of Luanda, Kizomba A will develop the Hungo and Chocalho discoveries in water depths of 3,300-4,200 ft. The development includes a surface wellhead platform and subsea wells tied back to an FPSO that has a storage capacity of 2.2 MMbbl.
Kissanje (Kizomba B - block 15) Angola
Last February, ExxonMobil began construction of its second deepwater development in Angola’s block 15. The company expects the $3-billion world-class Kizomba B project to recover nearly 1 Bbbl of oil at a target production rate of 250,000 b/d.
Kizomba B will develop the Kissanje and Dikanza discoveries in water depths of 3,300-3,400 ft. The project combines a surface wellhead platform and subsea wells tied back to an FPSO with 2.2 MMbbl storage capacity. Exxon expects first oil by early 2006.
While Exxon moves forward with this novel approach, the company is also firming up development plans for its Kizomba C field, which is likely to use a look-alike FPSO to Kizomba A and B. Planning for Kizomba D will follow shortly thereafter and is also projected to include a similar FPSO for development.
Morris Foster, president, ExxonMobil Development Co., says the Kizomba developments, because of their size and significance as projects, draw serious attention to Angola and the West African offshore.
“This and other developments being planned for block 15 will provide significant additions to our liquids production in the coming years and highlight the growing importance of Angola to global energy supplies,” Foster says.
Kizomba B is one of the enormous projects in the region that will drive capital expenditure in 2005.
Benguela (block 15) Angola
Last June, ChevronTexaco subsidiary Cabinda Gulf Oil Co. Ltd. (Cabgoc) awarded three major contracts for the first phase of the Benguela, Belize, Lobito, and Tomboco (BBLT) development fields in deepwater block 14.
BBLT is the second major development in block 14. The Kuito field development, which began production in late 1999 - 30 months after discovery - is Angola’s first deepwater producer. The BBLT development is 50 mi offshore in more than 1,250 ft of water.
ChevronTexaco plans to combine the Benguela-Belize integrated drilling and production platform hub facility, supported by a compliant piled tower (CPT), with tieback to the Lobito-Tomboco subsea wells, enabling phased development of the BBLT reserve base. Chevron says it believes this to be the industry’s first application of CPT structural technology outside the Gulf of Mexico. At 1,280 ft, the tower will be among the world’s tallest man-made structures.
The company expects first production from the Benguela and Belize fields by year-end 2005.
The first-phase development includes drilling and completion of more than 30 development wells, some of which will employ extended reach technology. ChevronTexaco expects the second phase of the BBLT development, involving the Lobito and Tomboco fields, to produce via subsea wells tied into the central production hub.
The company expects first production from Lobito and Tomboco in early 2007. Chevron expects combined BBLT annual production to peak at 2,000 b/d by 2009.
Angola
Cabgoc’s Sanha condensate project offshore Cabinda, Angola, will produce condensate for processing on the world’s first liquefied petroleum gas (LPG) FPSO. Cabgoc will produce first LPG, which is a mixture of butane and propane, from theSanhaFPSO in 2Q 2005.
Sanha will also harness gas from nearby producing fields, much of which was previously flared, for fuel and reinjection.
The fields and facilities under development extend across shallow-water areas B, C, and A in block 0. Area A covers the nearshore region out to 75-m water depth. Areas B and C continue out to 200-m depth.
Area A has been under development since 1968. Production began in Area B in 1994. The two Area C fields in production are North N’Dola and South Sanha.
The focal point of the condensate project is a new platform complex in the central Sanha field, comprising a process compression installation (PCP) and remote flare jacket, bridge-linked to a drilling production platform and a living quarters platform. LPG, recovered in a cryogenic LPG plant on the PCP, will be sent to the LPG FPSO 5 km away. Cabgoc will compress and reinject dry residue gas.
Northwest of this complex, a new wellhead platform was installed on the Bomboco field, which began production in January 2005. Bomboco is expected to produce an average of 30,000 b/d within the next year and is an integral component of Cabgoc’s Sanha condensate project. Chevron expects combined Sanha and Bomboco peak production of 100,000 b/d of oil and LPG in 2007.
Dalia (block 17) Angola
Discovered in 1997 near the 700-MMbbl Girassol field, the Dalia field is 135 km offshore in water depths of 1,200-1,500 m.
In May 2003, state-owned Sociedade Nacional de Combustíveis de Angola (Sonangol) authorized Total, operator of block 17, to award the key contracts for developing the Dalia oil field.
The development project includes 34 production wells, 30 water injection wells, and three gas injection wells. Dalia’s FPSO will constitute a second pole of production on block 17. Capable of processing 240,000 b/d of oil, the FPSO will also have a storage capacity of 2 MMbbl of oil. Total says the FPSO, with its storage capacity of 2 MMbbl of oil, will be as big as theGirassolFPSO, which is rated as the biggest in the world.
The launch of Dalia, due onstream in the second half of 2006, is a key step in the development of block 17, where 15 earlier discoveries have been made.
Baobab (CI-40) Côte d’Ivoire
Canadian Natural Resources’ Baobab field is 65 km from Abidjan, Côte d’Ivoire, in water depths of 900-1,300 m.
In September 2003, CNR awarded Technip an engineering, procurement, installation, and commissioning contract for subsea development, covering design, procurement/fabrication, and installation of rigid pipelines as well as flexible risers and free issue steel core umbilicals. The contract also includes installation of manifolds and spoolpieces and precommissioning of all pipelines and risers.
Technip awarded Subsea 7 a contract for subsea umbilical riser and flowline installation, which includes two rigid flowlines. The work began at the end of last year.
Modec won a contract for the FPSO, which is one of the deepest water FPSOs in the world, capable of processing 70,000 b/d of oil, 75 MMcf/d of natural gas, and 100,000 b/d of water injection. The Jurong Shipyard is building the vessel.
The Baobab discovery will be onstream in mid 2005. The development plan calls for seven oil producer and three water injection wells.
CNR calls its development projects in Côte d’Ivoire a significant growth driver over the next few years, noting there are additional exploration and exploitation opportunities to come.
Chinguetti, Tiof/Tiof West Mauritania
The Chinguetti field was discovered in 2001. The reservoir is 1,300 m to 1,900 m below the seafloor and consists of three main gas discoveries at Chinguetti, Tiof, and Banda. Chinguetti will begin production this year, as will the Tiof/Tiof West early production system.
In July 2004, the Mauritania joint venture partnership agreed on details for the 2004 exploration and appraisal drilling campaign, which included development drilling on Chinguetti in 4Q.
The 4Q drilling marked the beginning of a 20-well exploration, appraisal, and development drilling campaign. Phase one production includes development drilling including up to six oil production wells, four water injection wells, and one gas injection well.
At start-up, Chinguetti will produce from six production wells. A combined development plan points toward using a single FPSO to develop the field complex, which will include Tiof and Tiof West. The plan includes development drilling, subsea facilities installation, and an FPSO in 2005. Woodside will use the converted trading tankerBerge Helene, which will have a storage capacity of 1.6 MMbbl of oil.
The complex will see first oil in 2006.
Bonga Main (OML 118) Nigeria
Shell’s Bonga field lies 120 km offshore Nigeria in water depths of 950-1,150 m. The 60-sq-km field was the first discovery in deepwater offshore Nigeria.
Bonga is also the first deepwater project for Shell Nigeria Exploration and Production Co. Ltd.
Bonga’s production plan centers around theBongaFPSO, which has a capacity of 225,000 b/d of oil and 100,000 b/d of water. As field development progresses, Shell can upgrade the water production.
The field’s subsea system includes 30 seabed well locations and 37 subsurface targets.
Gas from Bonga will move via pipeline to the Nigeria Liquefied Natural Gas (NLNG) plant at Bonny Island. Tankers will export the oil.
Shell operates the license on behalf of Nigerian National Petroleum Corp. (NNPC), in association with Esso, Agip, and Total.
Erha (OPL 209) Nigeria
ExxonMobil affiliate Esso Exploration and Production Nigeria Ltd. (EEPN) confirmed the Erha deepwater oil and gas discovery in OPL 209, 100 mi southeast of Lagos in December 1999.
Target production rate for Erha is 210,000 b/d of liquids. EEPN has scheduled the project to begin production in early 2006.
EEPN began construction of Erha in October 2002. The project features a flexible design that will position it for use as a strategic hub on future OPL 209 deepwater developments.
Plans for field development center around an FPSO with 24 subsea wells - 15 production wells, four gas injection wells, and five water injection wells.
Target initial annual average production is 150,000 b/d of oil. The company will reinject gas to maximize oil recovery and eliminate routine flaring.
The FPSO will have a hull measuring 285 m long, 63 m wide, and 32 m high and will carry 24,000 metric tons of production modules and living quarters. The vessel will have 2.2 MMbbl of storage capacity and an initial production capacity of 165,000 b/d of oil.
Yoho (OML 104) Nigeria
The Yoho field came onstream in 2002, with Mobil Producing Nigeria Unlimited introducing an early production system (EPS) to produce the field nearly two years ahead of scheduled production.
TheFalconFPSO, converted from an existing tanker, has storage capacity of 2.2 MMbbl. It features an external turret mooring system and production facilities capable of producing 100,000 b/d of oil and 100 MMcf/d of gas. The turret can accommodate a maximum throughput of 90,000 b/d of oil.
The development plan includes an FSO vessel that will replace the FPSO. Targeted peak production is 150,000 b/d.
Yoho will serve as a hub for future development of other OML 104 petroleum resources.
Rex W. Tillerson, senior vice president, ExxonMobil, says, “The commencement of Yoho construction activities, including the first deployment of an EPS in West Africa, represents an important milestone for ExxonMobil in Nigeria.”
