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BW Energy has concluded on an alternative development plan for the Hibiscus/Ruche satellite field in the Dussafu license offshore Gabon, using a converted jack-up rig to reduce investments and time to first oil. The previous plan involved constructing and installing a new wellhead platform. As a result of its decision to use an alternative development plan, BW Energy acquired two jack-up drilling rigs, the 2003-built sister-units Atla and Balder, from Borr Drilling and will pay a total of $14.5 million for the two units.
The new development plan is expected to lower the estimated cash-break even oil price for the Hibiscus/Ruche (phase 1 and 2) development to approximately $25 per barrel Brent. With the planned increased production from Hibiscus/Ruche, the Dussafu license production cost, including the Tortue field, is expected to drop to approximately $11 per barrel. A final decision to restart the Hibiscus/Ruche development is subject to a lifting of COVID-19 restrictions to allow for efficient project execution. The initial Final Investment Decision approved for the Hibiscus/Ruche development was approved in the fourth quarter of 2019 with an estimated gross development cost of about $660 million for both phases and proven resources (2P) of gross 112 million barrels of recoverable oil.
The Nigerian National Petroleum Corporation (NNPC) is set to commence oil exploration in the Lake Chad Basin of Borno State and is being facilitated by the restoration of relative peace in the basin by the Nigerian Army. Minister of State for Petroleum Resources, H.E. Timipre Sylva, who was accompanied by the Group Managing Director Alhaji Mele Kyari and others disclosed the development after meeting with the Chief of Army Staff, Lieutenant-General Tukur Buratai and the Commander of the Multinational Joint Task Force, Major-General Ibrahim Yusuf, at the Maimalari Cantonment in Maiduguri.
Nigeria’s First Exploration and Petroleum (E&P) Development Company, in partnership with the NNPC, has started oil production from the Anyala West field, located in Oil Mining Leases (OMLs) 83 and 85, offshore Nigeria. The Anyala-Madu field development project is expected to produce 142 million barrels of oil and 98 billion standard cubic feet of gas during the first phase. According to First E&P, a total of seven development wells in OML 83, as approved by the Department of Petroleum Resources, have been planned in the first phase.
The wells will be developed along with the nearby Madu field in OML 85 and will be jointly produced in the Abigail-Joseph floating production storage and offloading unit (FPSO). The FPSO has a storage capacity of 700,000 barrels, an oil processing capacity of 60,000 barrels of oil per day (bpd) and can store gas at a capacity of 39 million standard cubic feet per day.
The Dangote Group announced that refined petroleum products from its 650,000-bpd refinery presently being constructed will hit the local market in the fourth quarter of 2021. The refinery has reached 80% overall completion; engineering and design are 100% complete and procurement at 98%, so construction at 60% is all that delays the refinery from coming online. The group hopes to complete the process of assembling the refinery by the middle of 2021, and then begin the commissioning process, which will take three to four months due to the size of the refinery. After this period, the products will come into the market from the refinery, forecasted to be the fourth quarter of 2021.
On November 5, crude oil prices slid as the slow-grinding vote in the U.S. election and too-close-to-call races between President Donald Trump and Joe Biden led to caution in the commodity sector’s most politically sensitive market. The U.S. West Texas Intermediate crude futures were down 31 cents, or 0.8%, at $38.84 per barrel at 1:40 PM ET (17:40 GMT), while Brent crude slid 24 cents, or 0.6%, to $40.99 per barrel. The U.S. Energy Information Administration’s weekly report showed a surprisingly large drawdown in U.S. crude reserves of 7.998 million barrels, against a forecast draw of 890,000 barrels.
Oil prices fell on signs that the world’s largest producers are still cutting official prices and chasing market share. Also, dollar weakness sent many commodity prices higher for a second straight day in the wake of an election that yielded no clear winner. While the market awaits the effect of the U.S. elections on oil prices, Saudi Arabia reported that it had cut its official selling prices for customers in Asia for December shipments of the Arab Light blend. The new price is at a 10c bigger discount to contractual benchmarks. The fight for market share was also evident in reports showing that Iraq’s crude output had risen 6.7% in October to a level well above its agreed quota under the Organization of the Petroleum Exporting Countries and allies (OPEC+) agreement on output restraint.
Such figures tend to play badly with Saudi Arabia and Russia, which have reportedly been trying to persuade other signatories to that pact to push back a production increase scheduled for the start of next year. Analysts said not bringing more supply online is key to saving price levels and avoid market turmoil, especially as some of the demand expected to return will be slashed by the second wave of the pandemic and the related travel restrictions. Also, the uncertainties arising from the U.S. election result will be reflected in uncertainty among the leadership of the OPEC+ bloc, which would have hoped for clearer implications for the direction of U.S. energy