ExxonMobil Corp has announced a $10 billion investment in offshore oil operations as part of a renewed focus on Nigeria, Africa’s fourth-largest economy.
Key highlights of the investment include:
- A $10 billion commitment to Nigeria’s offshore oil industry, specifically targeting the development of the Owo project.
- An annual injection of $1 billion into maintenance operations.
- A further $1.5 billion allocated to boost oil production by 50,000 barrels per day over the next few years.
The announcement came after Nigeria’s Vice President, Kashim Shettima, met with ExxonMobil executives on the sidelines of the 79th Session of the United Nations General Assembly in New York. Despite recent moves by ExxonMobil to downsize its Nigerian operations, including the $1.3 billion sale of onshore assets to Seplat Energy, this marks a significant renewed commitment to the country’s oil sector.
The Owo project, a major subsea tie-back, is at the center of this strategy, with an estimated total cost of $10 billion. ExxonMobil also plans to allocate $1 billion annually for ongoing maintenance and $1.5 billion to increase production capacity.
Shane Harris, Chairman and Managing Director of ExxonMobil Affiliates in Nigeria, emphasized that the company is working closely with the Nigerian government to secure favorable fiscal terms for this investment. “We are collaborating with the president’s office to create the conditions necessary for such a substantial commitment,” Harris said.
Vice President Shettima echoed this sentiment, stating: “This potential investment by ExxonMobil aligns perfectly with President @officialABAT’s vision for a more investment-friendly Nigeria. We are dedicated to fostering an environment conducive to transformative projects.”
Nigeria’s oil production, which is critical to its economy and government revenue, rose by 10.15% in the second quarter of the year, averaging 1.41 million barrels per day (bpd), compared to 1.22 million bpd in the same period last year. However, despite being Africa’s largest oil producer, Nigeria continues to grapple with significant challenges, including oil theft and sabotage.