NNPC, TotalEnergies sign $550 million FID deal for Ubeta oil field

In a significant advancement for Nigeria’s oil and gas sector, the joint venture between NNPC Ltd and TotalEnergies has announced a $550 million Final Investment Decision (FID) for the Ubeta Field Development Project.

This development aligns with President Bola Tinubu’s Presidential Executive Order on Oil & Gas Reforms, aimed at enhancing the investment landscape and positioning Nigeria as a prime destination for oil and gas investments in Africa, a statement by Olufemi Soneye,
NNPCL’s Chief Corporate Communications Officer, said on Thursday.

The Ubeta field, discovered in 1964 and located northwest of Port Harcourt in the eastern Niger Delta, is expected to produce approximately 350 million standard cubic feet per day (MMScf/day) of gas and 10,000 barrels per day (BBLS/day) of associated liquids once operational.

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This project will significantly tap into Nigeria’s extensive gas reserves and secure gas supply for Nigeria Liquefied Natural Gas (NLNG) Limited.

During the signing ceremony held at the NNPC Towers, Mallam Mele Kyari, Group Chief Executive Officer of NNPC Limited, expressed gratitude for the support from stakeholders and emphasised the pivotal role of President Tinubu’s administration in creating a favourable operational environment.

Kyari noted, “We appreciate Mr. President for supporting us with the appropriate fiscal environment. The Presidential Executive Order is instrumental to us getting to this significant milestone, and we are now seeing the impact of the policy.”

Mike Sangster, Senior Vice President Africa, Exploration & Production at TotalEnergies, highlighted the strategic importance of the Ubeta project.

“Ubeta is the latest in a series of projects developed by TotalEnergies in Nigeria, most recently Ikike and Akpo West. I am pleased that we can launch this new gas project, which has been made possible by the government’s recent incentives for non-associated gas developments.

“Ubeta fits perfectly with our strategy of developing low-cost and low-emission projects and will contribute to the Nigerian economy through higher NLNG exports,” Sangster remarked.

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The Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, praised President Tinubu for reigniting investor confidence in the oil and gas industry. He assured that more investments are forthcoming, enhancing the sector’s growth and stability.

Echoing this sentiment, Minister of State for Petroleum Resources (Gas), Rt. Hon. Ekperikpe Ekpo, emphasised that the Ubeta project exemplifies the success of governmental policies in fostering a conducive investment environment in the gas sector.

Located in OML58, the Ubeta gas condensate field will be developed with a new six-well cluster connected to existing Obite facilities via an 11-kilometre buried pipeline.

Production is slated to commence in 2027, with an anticipated peak production of 300 million cubic feet per day, equivalent to about 70,000 barrels of oil per day, including condensates.

Gas from Ubeta will be supplied to NLNG, a liquefaction plant on Bonny Island, which is currently expanding its capacity from 22 to 30 million tonnes per annum (Mtpa), where NNPC Limited holds a 49 per cent interest, according to the statement.

The Ubeta project is designed as a low-emission and low-cost initiative, utilising existing gas processing facilities in OML58.

To further reduce carbon intensity, a 5 MW solar plant is under construction at the Obite site, and the drilling rig will be electrified.

TotalEnergies is collaborating closely with NNPC Limited to maximise local content, with more than 90 per cent of the work hours expected to be completed locally.

This FID on the Ubeta project underscores the significant efforts by NNPC Limited, supported by Executive leadership, to address and overcome challenges that have previously hindered foreign investment in Nigeria’s oil and gas industry.

The project is anticipated to stimulate economic activities, create numerous job opportunities, and deliver substantial value to all stakeholders involved.

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