London, UK
Shell PLC has announced a new investment in Nigeria’s Bonga North, a deep-water project off the coast of the country.
Bonga is an oil field located 120 kilometres southeast of the Niger Delta in Nigeria.
The company announced the development in a statement published on its website.
“Shell Nigeria Exploration and Production Company Limited (SNEPCo), a subsidiary of Shell plc, has announced a final investment decision (FID) on Bonga North, a deep-water project off the coast of Nigeria,” the statement reads.
“Bonga North will be a subsea tie-back to the Shell-operated Bonga Floating Production Storage and Offloading (FPSO) facility which Shell operates with a 55% interest.
“The Bonga North project involves drilling, completing, and starting up 16 wells (8 production and 8 water injection wells), modifications to the existing Bonga Main FPSO and the installation of new subsea hardware tied back to the FPSO,” the statement indicated.
According to the company, the project will have a significant impact on the sustainability of oil and gas production at the Bonga facility with its current estimation of recoverable resource volume of more than 300 million barrels of oil equivalent (boe) and it is expected to reach peak production of 110,000 barrels of oil a day, with first oil anticipated by the end of the decade.
Zoë Yujnovich, Shell’s director of integrated gas and upstream was quoted saying “This is another significant investment, which will help us to maintain stable liquids production from our advantaged Upstream portfolio,”
Specific information about the project
- SNEPCo (55%) operates the Bonga field in partnership with Esso Exploration and Production Nigeria Ltd. (20%), Nigerian Agip Exploration Ltd. (12.5%), and TotalEnergies Exploration and Production Nigeria Ltd. (12.5%), on behalf of Nigerian National Petroleum Company Limited (NNPC).
- Bonga is a deep-water development located in OML 118, at water depths exceeding 1,000 meters. Production at the Bonga FPSO began in 2005, with a capacity to produce 225,000 barrels of oil per day. The project produced its one-billionth barrel of crude oil in 2023.
- The Bonga North development holds estimated recoverable resource volumes of more than 300 million barrels of oil equivalent (boe). These volumes are currently classified as 2P (proven and probable) under the Society of Petroleum Engineers’ Petroleum Resources Management System.
- The estimated peak production and recoverable resources mentioned above are 100% total gross figures.
- The investment in Bonga North is expected to generate an internal rate of return (IRR) in excess of the hurdle rate for Shell’s Upstream business.
- Shell’s Upstream business continues to set new benchmarks in performance through near-field opportunities like Bonga North, leveraging technical expertise, strong partnerships, and a model built on simplification and replication.
Bonga North will help ensure Shell’s leading integrated gas and upstream business continues to drive cash generation into the next decade.
