July 13, 2024

OML 11 : OZA Oilfield kickstarts production, avoids volatile TNP route

Olubunmi Martins

San Leon, the independent oil and gas production, development, and exploration company focused on Nigeria, has announced, concurrently with other corporate stakeholders, the successful resumption of oil production on the Oza field, located within the large tract of Nigeria’s OML 11.

San Leone, which owns 11% of the asset, said in a statement obtained by EnergyDay that initial output from the field stabilized at 1,184bpd and is expected to rise gradually over time.

The OZA field is a 20 square kilometer concession carved out of OML 11 in 2003 as a marginal field and was awarded to Millenium Oil and Gas Company Limited during the country’s maiden bidding round exercise.

However, Canada-based Decklar Resources is developing the field through a Risk Service Agreement (RSA) and has deployed over $50 million to achieve  re-start field operations, with an additional unsecured loan of US$5.5 million extended by San Leone to Decklar Petroleum Nigeria Limited—the subsidiary arm of Decklar Resources, Canada.

Decklar and its joint venture partner, Millenium Oil & Gas Company Limited, also issued a similar statement and said, “We are pleased to announce that the Oza-1 well at the Oza Oil Field has reached an average, stabilized production rate of 1,184 barrels of oil per day .

The joint statement added that the “the well is producing this volume of sweet crude oil over a 46 hour period to be transported into storage tanks and then delivered by truck to the Umugini Pipeline Infrastructure Limited crude handling facilities ”

The asset operating partners further disclosed that “since Millenium’s acquisition of the Oza Field, approximately US$50 million has been spent on infrastructure in support of the restart of production.

This includes an export pipeline to tie the Oza Field production into the Trans Niger Pipeline (TNP), which goes to the Bonny Export Terminal, a lease automatic custody transfer (LACT) unit, fiscal metering system, infield flow-lines, manifolds, and the rental of a 6,000 barrel per day early production facility (EPF).

Decklar Petroleum had previously stated that the Oza Field has significant export and production capacity through processing facilities and infrastructure already in-place and operational, including export pipeline access tied into the Trans Niger Pipeline (TNP), which flows to the Bonny Export Terminal on OML 11, the largest terminal on the African continent and is operated by Shell Petroleum in Nigeria.

“This will allow for the immediate export and sale of crude oil from the Oza-1 well re-entry, the initial Oza horizontal development well and future wells, ” the company said, adding that additional early production and central processing facilities will be added as required to accommodate additional production levels from field development activities.

The Oza development is now anticipated, said Decklar Petroleum, to then continue with one or two more re-entries on existing wells and additional development drilling, with a potential of eight to ten wells being drilled for the full field development.

EnergyDay investigations, however, revealed the fact that the Trans Niger Pipeline (TNP) is presently disabled because of vandalism attacks and oil producing companies within its cluster are constrained to using alternative routes, particularly, the Umugini Pipeline Infrastructure, which is a private sector initiative that was put in place to checkmate the worsening case of vandalism on the TNP .

The Trans Niger Pipeline is directly connected to the Bonny Oil Export Terminal, reputed as the largest in Africa, with a trough-put capacity of about 1.2 million bpd.

Unconfirmed industry sources said that the OZA field is in a good position to produce a total volume of 10 million barrels of liquid and a richer supply of gas before it begins to decline.

The Trans Niger Pipeline has come under the attention of the EU in recent weeks because of  the huge volume of export resources, particularly gas, which can be transported to the European Union markets through the Bonny Terminal , using the TNP , as a single supply source.