Chevron lays out Nigeria investment, drilling plans amid IOC exodus

Chevron is scaling up investments in Nigerian deepwater and has acquired a stake in juicy oil block OPL 215, Nigerian officials said Jan. 25, amid struggles by the OPEC member to retain IOCs like the US major.

Clay Neff, president of Chevron International Exploration and Production, who unveiled the company's investment plans during a meeting with President Bola Tinubu in Abuja, said the company was entering a new phase of development of deepwater leases in Nigeria.

That includes signing a 20-year renewal of three deepwater leases, commencing seismic data acquisition in several deepwater blocks, expanding the prolific Agbami field project and a $1.4 billion infill drilling program between 2022 to 2026 in the shallow offshore and onshore Escravos area.

In addition, Neff said, Chevron had acquired an interest in deep offshore oil block OPL 215.

"Chevron's entry into OPL 215 block [will] boost deepwater development opportunities," he told Tinubu during the meeting, according to a statement by presidential spokesman Ajuri Ngelale.

Chevron on Jan. 25 confirmed the meeting with President Tinubu.

The company has not disclosed its equity interest in OPL 215, but it joins French supermajor TotalEnergies, which holds 40% stake in the license.

OPL 215 is located in the central part of the offshore Niger Delta and covers an area of around 2,500 sq km in water depths of 200 to 1,600 meters.

Divestments

Chevron, Nigeria's third-largest producer, has sought to reduce its onshore and shallow water presence in the West African country due to rampant oil theft and sabotage attacks.

Various IOCs, including Shell and ExxxonMobil, have been divesting after decades of operations, shifting to deepwater and frontier basins with less risk of disruptions.

Still, the Nigerian president has assured producers of the country's readiness to protect IOCs' investments, as well as address challenges facing the companies, Ngelale said.

Africa's biggest producer has the capacity to pump more than 2.2 million b/d of crude, according to estimates, but pumped 1.53 million b/d in December, according to the Platts OPEC Survey from S&P Global Commodity Insights, having seen output dented by underinvestment, a lack of exploration activity and insecurity.

The OPEC member has consistently missed its production target in recent years, prompting a quota cut at November's meeting.

Nigeria's Minister of State for Petroleum Heineken Lokpobiri said Jan. 15 that he had been holding talks with IOCs operating in Nigeria to strengthen partnerships and seek buy-in for planned crude output increases.