Shell concludes $600m Nigerian oil field deal

Royal Dutch Shell says it has completed the sale of its 30 per cent stake in Nigeria’s onshore Oil Mining Lease 24 in the Eastern Niger Delta to Newcross Exploration and Production for $600m.

French partner Total and Italy’s Eni also sold their respective 10 per cent and five per cent stakes in OML 24 to Newcross, Shell said in a statement on Thursday.

The Nigeria-based oil and gas exploration and production company will hold a total of 45 per cent in the field.

Shell last month said it had signed sales agreements for all the Nigerian oil assets it had put up for sale as part of a broad global cost-cutting drive.

OML 24 produced on average of around 13,000 barrels of oil equivalent per day during the first half of 2014, the company explained.

Early this month, Shell Nigeria Exploration and Production Company Limited announced plans to drill eight more wells in the Bonga field to help maximise deep-water production off the coast of Nigeria.

This third phase of the Bonga Main development is expected to add around 40,000 barrels of oil equivalent per day through the existing Bonga floating production, storage and offloading facility.

“This programme – on top of the ongoing Phase 2 drilling and after the start-up of Bonga North-West barely two months ago – further underlines our commitment to Nigeria and leadership in deep-water production,” Shell’s Vice President Nigeria and Gabon, Mr. Markus Droll, said.

Phase 3 is an expansion of the existing Bonga Main development and will involve drilling four oil producing and four water injection wells and the drilling is expected to start in 2015, according to the firm, adding that output from the new wells will be transported through existing pipelines to the FPSO facility.

The facility has the capacity to produce more than 200,000 barrels of oil and 150 million standard cubic feet of gas a day.

The Phase 3 work, according to the oil major, will be executed by several contractors including Nigerian companies that have developed deep-water expertise through the provision of similar services for SNEPCo.