…Says move signals deepwater revival
By Seun Ibiyemi
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has welcomed ExxonMobil’s $1 billion investment in the Usan Infill Project located in Oil Mining Lease (OML) 138, describing the commitment as a major boost for Nigeria’s upstream petroleum sector and a catalyst for the revival of deepwater drilling activities.
The investment, announced on Wednesday during the 25th Nigeria Oil and Gas Energy Week Conference and Exhibition in Abuja, is expected to increase production from the Usan field by approximately 40,000 barrels of crude oil per day.
Reacting to the announcement by the Managing Director of ExxonMobil affiliates in Nigeria, Jagir Baxi, the Commission Chief Executive of the NUPRC, Oritsemyiwa Eyesan, described the development as a strong vote of confidence in Nigeria’s oil and gas industry and the ongoing reforms under the Petroleum Industry Act (PIA).
In a statement issued by the commission’s Head of Media and Corporate Communications, Eniola Akinkuotu, Eyesan noted that the investment marks ExxonMobil’s return to drilling operations in Nigeria after nearly a decade.
According to the commission, Esso Exploration and Production Nigeria, ExxonMobil’s Nigerian affiliate and operator of OML 138, last conducted drilling activities in 2016.
“The Nigerian Upstream Petroleum Regulatory Commission has commended ExxonMobil and its partners for committing $1bn to the on-block activities for the Usan Infill Project in OML 138.
“With Esso’s last drilling operation dating back to 2016, the resumption of drilling signals renewed potential and value in our deepwater acreage,” the statement said.
Eyesan said the commission remains committed to advancing Nigeria’s portfolio of deepwater projects, noting that renewed investments are essential to increasing crude oil production, growing reserves, sustaining government revenue and restoring investor confidence.
She added that the project would also create employment opportunities, deepen local content participation and strengthen Nigeria’s position as a preferred investment destination in Africa’s upstream petroleum industry.
Earlier, ExxonMobil’s Managing Director, Jagir Baxi, commended the NUPRC and other government agencies for supporting the development of the project.
Esso Exploration and Production Nigeria operates OML 138 under a Production Sharing Contract with NNPC Limited, alongside partners Chevron, TotalEnergies and Nexen, a wholly owned subsidiary of CNOOC.
As a short-cycle investment, the Usan Infill Project is expected to sustain and increase production from the field, with first oil targeted within 18 months following seismic studies that identified the opportunity.
In a related development, the NUPRC presented Petroleum Prospecting Licences (PPLs) to successful bidders from the 2022/2023 Mini Bid Round and the 2024 Licensing Round, as part of efforts to attract fresh investments into Nigeria’s upstream sector.
Among the beneficiaries were Broron Energy Limited, which received PPL 2009; Petroli Energy Marketing and Supply Limited (PPL 269); Sahara Deepwater Resources Limited (PPLs 270 and 271); and Tulcan Energy E&P Company (PPL 2008).
The commission said the licensing exercise covers 12 successful awardees across 19 Petroleum Prospecting Licences, spanning deep offshore, shallow water and continental shelf acreages.
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According to the NUPRC, the awards represent another milestone in Nigeria’s drive to accelerate exploration activities, expand hydrocarbon reserves and create long-term value for the economy.
The latest developments come as Nigeria intensifies efforts to increase crude oil production above two million barrels per day, attract fresh capital into the oil and gas sector and reverse years of declining investments caused by ageing infrastructure, oil theft and delayed projects.
Since the implementation of the Petroleum Industry Act, the Federal Government and industry regulators have introduced fiscal incentives and regulatory reforms aimed at improving competitiveness and restoring investor confidence in the country’s upstream petroleum industry.
The regulator said ExxonMobil’s return to active drilling, alongside the award of new exploration licences, signals renewed momentum for Nigeria’s deepwater segment, which remains central to achieving sustainable crude oil production growth and boosting government revenues.
