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NNPC, TotalEnergies sign $550m investment deal on Ubeta project

NNPC, TotalEnergies sign $550m investment deal on Ubeta project NNPC, TotalEnergies sign $550m investment deal on Ubeta project

The Nigerian National Petroleum Company (NNPC) Limited has signed a memorandum of understanding (MoU) with TotalEnergies for the final investment decision (FID) on the Ubeta Field Development Project.

NNPC and TotalEnergies signed the agreement on Thursday in Abuja.

Speaking at the event, Mele Kyari, group chief executive officer (GCEO) of NNPC, said on stream, the Ubeta project will produce about 350 million standard cubic feet (MMScf) per day of gas and 10,000 barrels per day of associated liquids.

This, Kyari said, is an opportunity to tap into the vast gas reserves and contribute towards securing gas supply to Nigeria’s liquified natural gas (LNG).

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“I’m very convinced that many more projects will come alongside this as we progress,” Kyari said.

“And maybe not the right moment to make those announcements, but I know that a number of projects have been enabled by the executive order of Mr. President.

“No doubt, this project will create opportunities, jobs, and everything that you can imagine, including making our energy investment much more productive.

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“I know for sure that the engagements with our other partners will ensure delivery of gas sufficient to keep our train 1 to 7 active and at full capacity, and also realise our ambitions for train 7.”

While appreciating the support from stakeholders, Kyari highlighted the continuous support of President Bola Tinubu’s administration in facilitating a conducive operational environment, which he said is a major driver of the deal.

He also said the presidential executive order was instrumental to achieving the milestone and the impact of the policy is being seen.

In his remarks, Mike Sangster, senior vice president Africa, exploration and production, TotalEnergies, said he is pleased that the firm can launch the gas project which has been made possible by the government’s recent incentives for non-associated gas developments.

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“Ubeta is the latest in a series of projects developed by TotalEnergies in Nigeria, most recently Ikike and Akpo West,” Sangster said. 

“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.”

‘GOOD OLD DAYS WILL SOON BE RESTORED’

Also speaking, Heineken Lokpobiri, minister of state for petroleum resources (oil), said the president has significantly rekindled investor confidence in the oil and gas industry.

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He assured Nigerians that more investments are on the way.

“One of the biggest challenges we faced on assumption is lack of investment and trust in the Nigerian policies in the last 12 years,” Lokpobiri said.

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“I’m very happy to state that in the last nine month we have changed the narrative. I assure Nigerians that the good old days will be restored by creating an environment that is competitive and continues to attract investments.”

On his part, Ekperikpe Ekpo, minister of state for petroleum resources (gas), said the project is a testament to the effectiveness of the government’s policies aimed at creating a conducive environment for investment in the gas sector.

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ABOUT UBETA GAS PROJECT

Located in OML58, the Ubeta gas condensate field will be developed with a new 6-well cluster connected to the existing Obite facilities through an 11km buried pipeline.

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Production start-up is expected in 2027, with a plateau of 300 million cubic feet per day (about 70,000 barrels of oil equivalent per day including condensates). 

Gas from Ubeta will be supplied to NLNG, a liquefaction plant located in Bonny Island with an ongoing capacity expansion from 22 to 30 Mtpa, in which NNPC Limited holds a 49 percent interest.

Ubeta is a low-emission and low-cost development, leveraging OML58, and existing gas processing facilities. 

The carbon intensity of the project will be further reduced through a 5-megawatt (MW) solar plant currently under construction at the Obite site and the electrification of the drilling rig.

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