SENATE SUPPORTS AGIP $13.5 BILLION ZABAZABA OIL PROJECT

The Senate is in support of the commencement of the Nigeria Agip Oil Exploration(NAOE) Limited’s $13.5 Billion Zabazaba Deep sea Oil Project in the eastern part of the Niger Delta for its expected economic benefits to the Nigeria economy.

Given this indication over the weekend when the managing director of NAOE, Mr. Masssimo Insulla led some members of his management team to explain the fundamentals of the projects to the Senate Committee on Local Content, Senator Solomon Adeola (APC, Lagos West), the chairman of the Senate Committee on Local Content said from the proposals available on the project so far, the Zabazaba project may be the best of such projects in Nigeria in terms of costs and accruing benefits to Nigeria.

The Zabazaba NAOE deep sea oil project is packaged to include the construction of Floating Production Storage Offloading (FPSO) units, sub-seas installations and drilling rigs and patterned along the Total Upstream Nigeria Limited Egina project and Shell’s Bonga South West. The ZabaZaba field in water depth ranging from 1200 to 2400 meters has  a proven reserve of 560 million barrels of oil.

Senator Adeola said if the Nigeria Oil and Gas Content Development Act, 2010 and the recent Executive Orders by President Mohamadu Buhari  on Local Content is faithfully applied in the execution of the project it would generate millions of jobs for our teeming unemployed population adding that the project would further serve as avenue for employment of repentant Niger Delta militants as well as repentant Boko Haram insurgents in their thousands.

“From information you made available to the committee, it is obvious your costing for the project is more competitive that similar previously executed project which means that Nigeria will gain more in terms of financial benefits with cost recovery at the earliest duration. We also notes that with many of the activities slated for in-country production and fabrication, massive employment for our youths will be generated” he stated.

The senator therefore stated that the Senate is in full support of this project and urged the Federal government to give necessary approvals for the Final Investment Decision (FID) to be taken on the project adding that NAOE should submit its full local content plans for the project for oversight to ensure Nigerians are part of this multi-billion dollars project.

Mr. Insulla expressed appreciation for the support and vision of the Senate in seeing the project as a mutually beneficial economic venture adding that the project is expected to start in the fourth quarter of this year and is expected to achieve first oil in 2020.

“We have submitted all relevant documents to the Federal Government through such agencies as NAPIMS, NNPC and NCDMB. We will also avail the Senate Committee of requested documents as soon as we appear again before the committee” the MD stated.

Nigeria Agip Oil Exploration (NAOE) Limited and Shell Exploration and Production Company (SNEPCO) signed a production sharing contract at the ratio of 50:50 for the development of Zabazaba where NAOE is the operator.