NNPCL, Chevron, announce oil discovery in Niger Delta
The Nigerian National Petroleum Company Limited (NNPCL) and its joint venture partner, Chevron Nigeria Limited, have made a significant near-field oil discovery with the successful drilling of the Meji NW-1 well within the shallow offshore Niger Delta.
In a statement released on Friday, both parties revealed that the well, which was spud on September 2, 2024, reached a total depth of 8,983 feet, with operations completed on October 2. The drilling encountered approximately 690 feet of hydrocarbons within Miocene sands, appraising an extension of the already productive Meji field.
“The latest oil discovery marks an important milestone for Nigeria’s energy sector,” the statement noted. The discovery comes at a time when other major oil companies, including Shell, ExxonMobil, and Total Energy, have been reducing their focus on the Niger Delta, opting for less risky opportunities in regions such as Namibia and Guyana.
The NNPC Limited had earlier announced that it signed a deal with Chevron Nigeria Ltd for the conversion of five Joint Venture (JV) assets into Petroleum Industry Act (PIA) terms. The agreement, which was finalized on Monday, is expected to significantly boost crude oil production. The two partners are targeting an output of 165,000 barrels of oil per day (bopd) by the end of 2024.
Olufemi Soneye, Chief Corporate Communications Officer for NNPC Limited, emphasized that the deal aligns with the PIA 2021 provisions, which transition assets from the Petroleum Profit Tax (PPT) regime into PIA terms. “Under the new PIA regime, all existing Oil Prospecting Licenses (OPLs) and Oil Mining Leases (OMLs) will be automatically converted to Petroleum Prospecting Licenses (PPLs) and Petroleum Mining Leases (PMLs) upon expiration,” he explained.
Soneye added, “Nonetheless, an option of voluntary conversion is provided for holders of OPLs and OMLs under the erstwhile PPT regime. The PIA terms are generally perceived as more investor-friendly compared to the previous Petroleum Profit Tax Act (PPTA) terms.”
During the brief signing ceremony at the NNPC Towers, both partners formalized the conversion of five OMLs into four PPLs and twenty-six PMLs. This, they said, marks a significant step towards increasing domestic gas supply and expanding Nigeria’s footprint in the global energy market.
The new oil discovery is expected to strengthen Nigeria’s position in the global energy landscape, particularly as the country works to increase its oil output amidst the ongoing global energy transition. The collaboration between NNPCL and Chevron is viewed as a strategic effort to maximize the country’s oil and gas resources while adapting to emerging market dynamics.
