Total S.A., a French multinational integrated oil and gas company said it had started production from the Egina oilfield off Nigeria’s coast. The development is part of a shift by the French energy firm toward deepwater oil and gas projects to drive cashflow.
Egina, which is located in waters about 1,600 meters (5,250 ft) deep, is expected to have an output that will plateau at 200,000 barrels per day of oil. The oil and gas firm noted that the quantity is equivalent to about 10 percent of Nigeria’s current production.
Total’s head of exploration and production, Arnaud Breuillac said “Egina will significantly boost the group’s production and cashflow from 2019 onwards, and benefit from our strong cost reduction efforts in Nigeria where we have reduced our operating costs by 40 percent over the last four years”.
Total, which is the world’s eighth largest oil and gas company by revenue, is betting on profitable deepwater oil and gas fields in Sub-Saharan Africa, Brazil and the U.S. Gulf area. The company is also increasing its deep water projects in Africa, especially in the Republic of Congo and Angola.
In the coming years, the company forecasts that output from deepwater projects will reach 500,000 barrels of oil equivalent per day by 2020 and account for more than 35 percent of cashflow, compared with about 15 percent now.
This year, Total said it will decide on whether to invest in developing the Preowei field, located in the same block as the Egina field. For almost a decade, the company has been extracting oil from a third field in the block, Akpo, where it holds a 24 percent stake in the block’s lease and is the operator. Its partners are state-owned Nigerian National Petroleum Corp, China’s CNOOC, Brazil’s Petrobras and private Nigerian firm Sapetro.
Holding the largest proven reserves in Africa compared to the world’s top oil companies, Total is one of the strongest players on the continent.