The Federal Government of Nigeria is targeting an increase of approximately 810,000 barrels per day of crude oil from its deepwater oil fields through a new cluster and nodal development initiative. This plan aims to revive the country’s offshore oil production, which has experienced a decline in recent years.
The Nigerian Upstream Petroleum Regulatory Commission is spearheading this initiative, which involves executing already-approved Field Development Plans and adopting new cost-saving frameworks. According to the commission’s data, existing plans could unlock 1.55 billion barrels of oil and condensate, as well as 1.49 trillion cubic feet of associated gas.
The targeted increase is 810,000 barrels per day from deepwater fields, which could raise Nigeria’s total monthly crude production by 2.51 million barrels with condensates. There are over 5.13 billion barrels of oil and 13.53 trillion cubic feet of gas in deepwater acreages, with 3.59 billion barrels in proven and probable reserves. Nigeria’s deepwater production peaked at 800,000 bpd in 2016 but has since dropped below 500,000 bpd.
A new committee has been inaugurated within the commission to work closely with International Oil Companies and indigenous producers. The committee aims to identify and mature opportunities, maximize returns from existing assets, ramp up volumes, and reduce unit technical costs.
The government has offered incentives, including zero hydrocarbon tax on deepwater fields under the Petroleum Industry Act and presidential directives that provide fiscal incentives for gas development and local content compliance.
