Total: At the vanguard of local content, partnership in Nigeria’s oil sector

Since the discovery of oil in large commercial quantity in Oloibiri, now in Bayelsa State in 1956, the black gold (as crude is commonly called) and the oil industry has continued to play a vital role, making significant contributions to the Nigerian economy.

An umbrella body uniting the oil companies, major players and other critical stakeholders in the oil sector is the Nigerian Association of Petroleum Explorationists (NAPE). The association has, over the years, is holding its Annual International Conference and Exhibition (AICE), where the operators and other stakeholders in the industry converge to rub minds and share ideas on how to further move the industry forward.

Giving his inaugural speech on assumption of office as NAPE President in 2016, Abiodun Adesanya, said: “the future of the association demands that we seek new knowledge to meet new problems and challenges, especially in this current dispensation of national and global recession.”

He said it has become expedient for NAPE to seek for new cooperation, partnerships and collaborations with other relevant stakeholders, including professional associations, government, industry and the academia.

Leveraging on the challenge posed by Adesanya (now the former president, having been succeeded by Andrew Ejayerise), NAPE adopted ‘A Roadmap for Nigeria’s oil and Gas in a Diversifying Economy’ as its theme for the 35th AICE, held recently at the Eko Hotel and Suites, Victoria Island, Lagos.

The four-day conference was attended by major players and ontical stakeholders.

The AICE 2017 was opened with a pre-conference workshop on November 9, with the theme ‘Transforming Nigeria’s Oil and Gas Industry to Meet Global Demand-Supply Realities. It had in attendance distinguished explorationists, managers and investors within and outside the oil and gas sector who gathered to brainstorm on the current state of the industry and to chart the way forward.

Among the major players in the oil sector is the Total Exploration and Production Nigeria Limited (TEPNG). For 55 years, the company has been actively involved in the whole value chain of the oil and gas, serving the country’s hydrocarbons industry, in partnership with the Nigerian government and in different equity associations with other private companies. It has abroad and diversified portfolio in the country, with activities spanning onshore, conventional offshore, deep water and Liquefied Natural Gas (LNG).

As a major oil and gas company in the country, Total has been one of the sponsors of the NAPE conferences over the years.

Speaking at the pre-conference, the Managing Director/Chief Executive, TEPNG, Nicolas Terraz, stressed the need for the understanding of the role operators of the industry, especially since diversification remains the only option for economic growth and development.

The challenging operating environment notwithstanding, the TEPNG MD/CEO said the company is committed to investing in the country, believing that “when Nigeria prospers, Total also prospers. Today, reference is being made to us as the industry benchmark for the Nigerian content, given our significant investment in local capacity development through our Ofon2 and Egina projects. Egina has the highest deep water local content ever in Nigeria.

The Egina field was discovered by Total Upstream Nigeria Limited (TUPNI) in 2003, within the Oil Mining Licence 130 (OML130), some 200 kilometres south of Port Harcourt. The field is being developed by Total Upstream Nigeria Ltd in partnership with NNPC, CNOOC, SAPETRO and PETROBRAS. It will add 200,000 barrels per day to Nigeria’s oil production (approximately 10 percent of the country’s total oil production).

Egina is the largest investment project currently ongoing in the oil and gas sector in Nigeria. The overall progress of the project stands at 88 percent and a key milestone was achieved on October 31, 2017, as the Floating, Production, Storage and Offloading unit (FPSO) started its journey to Nigeria. The project is expected to be completed in Q4 – 2018, within the initial budget of $16 billion.

Being the first major deepwater development project launched after the enactment of the Nigerian Oil & Gas Industry Content Development (NOGICD) Act of 2010, Egina has the highest level of local content of any such project in Nigeria.

“Among others, the development of SHI-MCI Yard on LADOL Island and significant work on seven Nigerian fabrication yards of various project scopes will continue to generate direct employment and indirect businesses for Nigerians throughout the life of the project. This is evident in the engagement of local contractors, investment in human capacity development and contribution to building and expanding local fabrication yards.

“Over four million man-hours of fabrication works for the FPSO were executed in Nigeria with a safety record of zero fatal accidents. Five Nigerian construction yards: EWT and Ponticelli in Port Harcourt; Nigerdock, Dormanlong and SHI-MCI in Lagos were engaged for fabrication of various FSPO structures, including the six Topside Modules to be integrated on the FSPO at SHI-MCI Yard.

“In addition to the ongoing projects, Total is intensifying a lot of efforts on exploration and appraisal activities with two operated Exploration and appraisal wells planned for this year; one in the conventional offshores and with the drilling of the second one in the deep offshore almost finalised and with the results in line with prognoses. Our plan is to maintain aggressive and appraisal wells drilling in order to play our part in increasing the hydrocarbon resource base of the nation,” Terraz said.

The Total MD/CEO also spoke on the partnership of Total with other critical operators in the industry as he disclosed that, in 2016, the NNPC-Total E&P Nigeria Limited Joint Venture commenced the supply of gas to the Alaoji Power Plant in Abia State. This, he said, became possible after the completion and start-up of the Obite-Ubeta-Rumuji Pipeline and the Northern Option Pipeline projects by the NNPC/TEPNG JV in August 2016.

“The completion of these pipelines is an important milestone in the activities of Total in Nigeria. The NOPL is unique and strategic in meeting the Federal Government’s objectives of gas supply to the domestic market,” he added.

As a corporate citizen of Nigeria, the management of Total is not oblivious of the fact that the status comes with certain responsibilities, not just to the company’s host communities, but also to the entire country as a whole. Towards this end, Total’s Managing Director/Chief Executive re-affirmed that the company shall continue to assist the authorities in providing infrastructure and access to quality healthcare and education to Nigerians and the communities that host our operations.

Many speakers at the third technical session of the NAPE Conference spoke on “Application of New Technologies to Exploration in Africa. They agreed that the industry is lagging behind in terms of the needed technology for exploration and production.

To improve on exploration successes in Nigeria, it was agreed that the operators should join the rest of the world by leveraging on advances in seismic acquisition and digitalisation.

Among the speakers at the third technical session was the General Manager, Exploration, Total, Chris Enuma, who painted a gloomy picture declaring that there were no more giant discoveries as there has been a drastic decline in exploration activities in Nigeria since 2006 due, not only to financial ability but also to lack of the technological wherewithal.

He said the decline in giant exploration discoveries was as a result of dealing with very complex geology that needs to be properly understood before drilling, adding that the conventional technologies, in most cases, have reached their limits, in terms of subsurface imaging.

However, Enuma did not stop at only identifying the problems facing the oil industry, especially in the area of exploration, but also proffered some solutions as well. According to him, the development and application of new technologies have become imperative and inevitable in order to be able to drill material prospects.

He disclosed that Total is collaborating with ExxonMobil, Shell and a university based in Texas, US to mitigate the environmental objections to seismic surveying, even as he called for collaboration between International Oil Companies (IOCs) as key to achieving needed new technologies for contemporary explorations.

“Collaboration between IOCs and contractor companies will go a long way and even foster the attempts and efforts at developing new technologies for the required exploration success. All African national oil companies are encouraged to be part of the new technological innovation,” Enuma added.