Oil Reserves: More $500bn needed, Chevron

http://www.vanguardngr.com/2010/11/oil-reserves-more-50bn-needed-chevron/

By Clara Nwachukwu

Chevron Nigeria Limited, CNL, estimates that about $500billion more would be required for new discoveries and fields’ development in the deep water, in addition to the $30billion already spent over the past decade.

Broken further down, Chevron estimated that the bulk of the sum about $40billion would be deployed to new discoveries to fully recover known reserves, while the balance of $10billion would be used to ultimately develop existing fields.

The Director, Deepwater Assets & PSCs, CNL, Mr. Ken Sample, who spoke on: “Growing Nigeria’s Oil Reserves and Production: What Role for Deepwater? during the 3rd Deep Offshore West Africa Conference, DOWC, in Abuja, said production from the deepwater region is expected to increase due to maturation of existing discoveries.

He noted that hitherto, the Onshore/Shelf exploration and production has dominated the Nigerian oil industry since the 1960’s, but however, added that recent major discoveries have shown that the deepwater is expected to play a significant role in the Federal Government’s aspiration to grow reserves and production.

Government has set new reserves and production targets at 40 billion barrels and 4million barrels per day respectively, but the date of achieving them is still a matter of controversy between the government and the industry operators.

Notwithstanding that major deepwater discoveries in the late _1990’s have changed the oil exploration/production landscape; Sample argued that further breakthroughs in this region are dependent on four pillars technology, cost efficiency, commitment and friendly environment.

He said, “Nigeria’s Deepwater has a major role to play in growing the country’s oil and gas reserves, production and economy. (But) significant investments and new technologies will be required to find new oil and maximize recovery from existing fields.

“A committed workforce that has the skills and experience required to deliver this ambitious programme is essential, (while) a conducive investment climate is needed for the Nigerian deepwater industry to compete for global investment funds to build the next queue of world-class development opportunities.”

Speaking further on each of the issues, Sample said that better technology is needed to not only improve oil recovery from existing fields, but also boost the finding and development of new fields.

According to him, “Exploration risk in the deepwater has increased after the initial major discoveries. Only two exploration wells were drilled in 2009, down from five each in 2007 and 2008.”

Consequently, he noted that “Typical time from discovery to first production is now between eight and 10 years,” and as a result, future production would require “innovative and cost effective field development technology for both new and tie-back infrastructure.”