Offshore West Africa is poised to become an important source of oil and gas supplies for global consumption, with 6.5 bn bbl of oil discovered in the last 2 years alone. Speaking at the Offshore West Africa conference in Abuja, IHS Energy analyst Adebola Adejumo said oil companies were attracted to the province because of large discoveries and rising energy prices.
"Angola, Algeria, Libya, and Nigeria will provide 80 % of the production," Adejumo said.
Chris Ogiemwonyi, Nigeria National Petroleum Corp. group executive director of exploration and production, said Brazil's large oil find, Tupi, was an exciting development because it suggested that similar discoveries could emerge off West Africa, as they share similar basins.
"We need an aggressive exploration program," he added.
With fears intensifying over the volume of the world's produced reserves and a reduction in access to prolific oil and gas zones such as Russia and Iran, oil companies are turning to West Africa as they rework already matured producing areas. The world holds an estimated 4.82 tn bbl of oil resources with only 1.08tn bbl produced.
But the challenges to bring on production -- particularly in deep water -- are immense, speakers noted during the opening session. Operators are finding tightening fiscal regimes in applying for licenses, increasing project costs, and political volatility, which must be surpassed to unlock the region's potential.
Oliver Onyewuenyi, program manager for global deepwater R&D at Shell International Exploration & Production, said the cost of drilling deepwater wells had risen from $ 30 mm to $ 100 mm. Developing new technologies is crucial to tapping deepwater oil and gas fields where there is rugged terrain, shallow gas seepage, and a low seabed temperature environment.
"Subsalt imaging is evolving to help us do more," he added. Other technologies that are enabling deepwater exploration and production include subsea processing and long distance subsea tiebacks.
However, associated gas in Nigeria and Angola is a key problem for operators in developing major projects, Onyewuenyi said.
"How do we monetize it? If you can convert the gas to LNG or liquids, then that can help the economics of projects."
Nigeria's gas flaring has amounted to $32bn/year, according to Adejumo. This is equivalent to 3.5bn billion barrels of oil over the past 26 years. It has repeatedly extended its zero gas flaring deadline, but Adejumo said it was unlikely to meet it unless local consumption could be stimulated and pipelines built to gather gas. Major international projects such as the West African gas pipeline, Trans Sahara gas pipeline and additional liquefaction trains at Nigeria LNG will use associated gas that otherwise would be flared.
