-Victoria Opeyemi
One of Nigeria’s revered energy associations, Centre for Petroleum Information (CPI) had its Petroleum Policy Roundtable (PPR-XXV) in Lagos with the Theme: Prospering in Nigeria’s Changing Energy Industry Landscape. The event attracted experts in the energy space who converged to deliberate on salient issues bothering the sector.
Buttressing her point on marginal field development at the event, Olajumoke Ajayi, MD/CEO, Ingentia Energies Limited, spoke on the topic: Marginal Field Development: Getting Started from Ground-Zero.
Ajayi spoke on the Egbolom Field operated by Ingentia Energies Limited, the company was incorporated in 2022 and the field awarded same year. It re-entered existing well on dual completion; utilized HWU and achieved technical first oil, six months into the commencement of field operation.
Ingentia identified various crude evacuation strategies, sustained cordial community relationship, achieved approval of field development plan and highly experienced technical management professionals.
The NAPE President-Elect explained that marginal fields are previously discovered but undeveloped fields, they are economically unattractive under initial assessments and often abandoned by major operators.
Nevertheless, marginal fields have economic and strategic importance with untapped resource potential. They boost local content and indigenous operator participation by meeting increasing energy demand, support indigenous development and job creation in the country.
Getting Started from Ground-Zero
Starting a marginal field from ground-zero requires data acquisition and evaluation. Gather legacy data: seismic, well logs, engineering data, reports, test results and production history.
Ajayi pointed out that there is need to engage with previous operators, determine volumes in place and reserves, carryout field evaluation with field development plan and installing production equipment such as pumps, separators and flowlines cannot be undermined.
Ensuring HSE standards and compliance field development plan with sustained cordial relationship with host community and monitoring early production trends for optimization.
Financing and Business Planning
For marginal field to survive through funding, Ajayi made it known that there should be prepared economic models such as CAPEX, OPEX, IRR, NPV etc. Identifying risks and creates mitigation plans and attracting financing through equity partnerships, bank loans, technical and operational planning. There should be prepayment with off-take agreements.
Technical & Operational Planning
▪ Choose development approach: re-entry, sidetracks, new drills
▪ Design modular, scalable surface facilities
▪ Evaluate tie-back options to existing infrastructure
▪ Plan for crude handling, evacuation and storage
▪ Ensure regulatory compliance at all times
Challenges
Marginal field operation comes with some challenges especially from inception. Ajayi posited that usually, there is paucity of data and limitation with high production costs per barrel. There is also issue with host community unrest and disturbance.
High operational cost, lack of finance and funding, forceful marriage by the then Department of Petroleum Resources (DPR), now Nigerian Upstream Petroleum Regulatory Commission (NUPRC) are part of the challenges bedeviling marginal fields.
Mitigating Strategies
In order to mitigate strategies, the MD/CEO of Ingentia Energies Limited, noted that marginal field operation needs much data gathering as possible through previous operators and host community.
Plan to acquire data and re-evaluate asset, form strategic partnerships and alliances, use flexible development and invest in community engagement from the start and obtain trust from community stakeholders are part of ways to mitigate strategies.
Ajayi spoke on identifying skilled personnel who can multitask, leverage on low hanging foot which will provide quick cash, establish a Joint Operating Agreement (JOA), early for smooth operations with determination to work together to put structure in place. All these will enhance and support a marginal field company.
The NAPE President-Elect advised that the use-for-purpose design that minimize cost but deliver operational reliability is significant for marginal field operation. The early production phase into actual reservoir behaviour allowing fine tune operations cannot be undermined
She spoke on financial viability which is crucial.
“Start lean, prove concept and attract more funding in later phases and risk sharing is key. Marginal fields offer untapped value with manageable risks.”
Ajayi said success depends on solid technical foundation with sound financial planning, regulatory navigation and community relations.
However, key to success lies in adaptability, collaboration and early problem identification. Partnerships reduce technical and financial burden.
From ground zero to first oil is possible with the right team and strategy in marginal field operation.
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