Exploration and
production division of Oando Plc, Oando Energy Resources (OER), has announced
completion of the 51km Umugini pipeline located in Niger Delta.
The Umugini pipeline is a common access production flow
facility that is conceived to relieve a group of indigenous players of
accounting disputes with Nigeria Agip Oil Company (NAOC) whose export pipeline
is hitherto used for production evacuation from a number of clustered marginal
oilfields in the area.
The pipeline which has flow capacity for 45,000 barrels of
oil per day (bbls/d) now provides Oando an alternative evacuation route for
crude oil produced from the Ebendo Field through the Trans Forcados export
pipeline, ensuring maximized production flow from and enhanced revenue.
Oando stated that oil production capacity within OML 56 has
grown to 7,140 barrels of oil equivalent per day (boepd) gross for OER and
Energia Limited, following the successful drilling of Ebendo wells 5, 6, and 7
over the last year.
Energia Limited is the operator of the asset.
However, export had been restricted to 3,093 bpd via the Agip operated Kwale-Brass NAOC/JV
infrastructure, in which OER currently has a 20% interest through the recent
$1.5Bn acquisition of ConocoPhillips Nigerian Oil & Gas Business.
Since the production of first oil in 2009, OER, in
conjunction with Energia, has spurred the growth of the Ebendo field by 400%
from 1,600 bpd to 8,050 bpd in 2014 with 4 additional wells.
The completion and commencement of operations on the Umugini
pipeline ensures the Ebendo field can now produce at an increased capacity of
11,250 bpd via the 12” evacuation route
to NPDC/Shell’s Eriemu station to the Focados terminal.
“This complements the existing 2,500 bpd evacuation via the cluster GGF and Agip
Kwale station to the Brass terminal,” the company stated.
Commenting, Pade Durotoye, CEO Oando Energy Resources said:
“We are extremely delighted with the achievement of this key milestone. The
completion of the Umugini pipeline will enable us fully maximise the value of
our investments to date on the asset, and provides the latitude for further
profitable development of prospects and resources identified in Ebendo.”
Ebendo is located onshore, in the central Niger Delta,
approximately 100 km north-west of Port Harcourt and covers an area of 65 km2
(16,062 acres). The License includes two fields, Ebendo and the Obodeti field.
Oando Energy Resources holds a 42.75% working interest in the field.
With Phase 3 development expected to commence in Q1 2015,
the completed Umugini pipeline effectively doubles the throughput from Ebendo
field by 3,727, and as crude oil prices fall, there is an added incentive for
producers to drive production volumes to sustain revenue from sales.
Previously firms like
OER, as well as Mart Resources and its partners on the Umusadege Field had to
rely on the Agip operated Kwale-Brass infrastructure to get their production to
the export pipeline. Over the past couple of years the Agip pipeline has seen
some shut-ins for repairs which constrained production for some of the
operators in the Niger Delta.
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