NNPC, Chevron, Shell sign $16bn JV deals for Sonam, Santolina projects


The Nigerian National Petroleum Corporation (NNPC) has signed financing agreements with its joint venture partners to develop the Sonam and Santolina projects.

The first deal, signed with Sonam JV partner Chevron Nigeria, will see Chevron provide around US$780 million in funding to develop Oil Mining Licenses (OMLs) 90 and 91, which are thought to contain around 211m bbl of oil and 1.9trn ft3 of gas.

The NNPC Group Managing Director, Maikanti Baru, said at the signing ceremony in London that at peak production, the Sonam project will deliver 39,000 bbl/d of oil and 283m ft3/d of gas. It is expected to generate US$7.3billion in earnings.

Around US$400million will fund the development of seven wells in OML 91 and the Okan 30E non-associated gas (NAG) well and associated facilities, including the Sonam NAG well platform, in OML 90.

A further US$380million will be used to reimburse the project’s lenders. Chevron has already spent around US$1.5billion on the Sonam project, which is expected to begin production within 3­–6 months.

Under the terms of the second deal, Santolina JV partner Shell Petroleum Development Corporation (SPDC), Shell’s Nigerian subsidiary, will fund 156 development activities in 12 OMLs and 30 different oil fields in the Niger Delta. The project overall is expected to generate US$9billion in revenue.

Shell Global Upstream Director, Andy Brown, said the funding arrangement was an innovative financing plan that would enable SPDC to commence exploration activities that had stalled due to funding challenges.


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