After spending 25 years exploring for hydrocarbon resources off the coast of Lagos,
Yinka Folawiyo Petroleum, in partnership with Panoro Energy ASA and First
Hydrocarbon Nigeria (FHN) Limited, among others, finally catapulted Lagos State
into the league of oil and gas producing states in the country.
Panoro, an independent oil and gas company based in the United Kingdom,
announced wednesday that oil production had commenced from the Aje oil field
located in Oil Mining Lease (OML) 113, offshore Lagos, on Tuesday, May 3.
Of greater significance also is the disclosure that the oil field holds untapped
reserves of about 650 billion cubic feet (bcf), which if harnessed in two to three
years’ time, according to a company source, could supply Lagos, Nigeria’s
commercial hub, all the gas feedstock it needs for the thermal power stations and
other manufacturing concerns domiciled in the state and its environs.
A statement from Panoro, which has assets in Nigeria and Gabon, said that the
subsea installation activities had been underway at Aje since January and were
completed in early March, ready for the hook up of the Front Puffin Floating
Production Storage Offshore (FPSO), which arrived in Nigeria on March 16.
According to the statement, oil produced from the Aje field will be stored in the
Front Puffin which has a production capacity of 40,000 barrels of oil per day (bpd)
and storage capacity of 750,000 barrels.
“Flow rates will be provided in Panoro’s next operations update, following a period
of inauguration and well stabilisation,” the statement added.
However, a company source informed THISDAY that the first two wells in Aje were
expected to peak at 12,000 barrels of oil per day, and the flow rates would increase
as more wells are drilled on the field.
Panoro’s Chief Executive Officer, Mr. John Hamilton, said his company was
extremely pleased to announce the start of the first oil production at Aje.
“This is a transformational milestone for Panoro and represents a great achievement
by the Aje project teams. It is also a key building block in our strategy to become a
full cycle E&P company focused on West Africa.
“The commencement of production at Aje is also significant for Nigeria as it is the
first commercial production for the country in the emerging Dahomey Basin,”
Hamilton said.
Located in the extreme western part offshore Nigeria, adjacent to the Benin border
in the Dahomey Basin, the field is situated in water depths ranging from 100 to
1,500 metres, about 24 kilometres from the coast.
The field is situated 64 kilometres from Lagos and 12 kilometres close to the West
African gas pipeline operated by Chevron.
In geological parlance, the field contains hydrocarbon resources in sandstone
reservoirs in three main levels – a Turonian gas condensate reservoir, a Cenomanian
oil reservoir and an Albian gas condensate reservoir.
With the field’s multiple oil, gas and gas condensate reservoirs in the Turonian,
Cenomanian and Albian sandstones, geologists said the Aje field, which was
discovered in 1997, has hydrocarbon resources similar to the nearby producing
Jubilee field, offshore Ghana.
The current Aje partnership, which was formed in August 2013, is made up of Yinka
Folawiyo Petroleum (operator), New AGE (African Global Energy), FHN, Energy
Equity Resources (EER), Panoro, and Jacka Resources.
The partners to the Aje field had in January 2014 submitted the Field Development
Plan (FDP) to the Department of Petroleum Resources (DPR) and this was approved
in March 2014, primarily for the development of the Cenomanian oil reservoir.
THISDAY had reported that the partners had missed the December 2015, January
2016 and March 2016 targets for first oil, apparently due to the late arrival of the
FPSO from Singapore, delay in the completion of the anchor handling operations,
and late completion of the installation of the subsea equipment, including the
manifold and flowlines.
After leaving Singapore for Nigeria, the FPSO had stopped briefly in Cape Town,
South Africa.
According to the field development plan, the development of the Aje Cenomanian oil
reservoir would be implemented via two subsea wells, the new Aje-5 well and a
recompleted Aje-4 well, and a leased FPSO.
The initial two wells were scheduled to start oil production early in 2016.
Two further wells – Aje-6 and Aje-7 – are expected to bring total Cenomanian oil
production up to over 50 million barrels.
The field development plan also provides that a third Turonian gas condensate
development phase that was conceptualised by the partners would involve three or
four wells that would produce over 500 billion cubic feet of gas, 22 million barrels
of condensate and 40 million barrels of liquefied petroleum gas (LPG
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