Seven Energy explains interest in Nigeria’s OMLs 4, 38, 41

nnpc27 November 2013, Lagos – Seven Energy, an indigenous Nigerian Exploration and Production company, has stated that it has indirect interest in oil mining lease, OMLs, 4, 38 and 41, through Strategic Alliance Agreement, SAA, with the Nigerian Petroleum Development Company, NPDC, a subsidiary of the Nigerian National Petroleum Corporation, NNPC.

Making a clarification in its recent annual report, the company stated it paid NPDC 55 per cent of the costs of the development of the fields, in addition to the provision of technical input.

The company said it received cost recovery volume plus a share of incremental production from the three leases, which were being operated by Seplat Petroleum Development Company Limited.
A source close to the company also clarified that contrary to a recent publication, the multimillionaire businessman, Kola Aluko, received no direct financial gain from his minority stake in the company.

Seven Energy further disclosed that during 2012, average gross production from the three leases amounted to 33,400 barrels of oil equivalent per day (bopd) from the four producing fields – Oben, Amukpe, Ovhor and Sapele.

“Daily production rates in excess of 40,000bopd were regularly achieved during the latter part of the year, although overall production was affected by shutdowns to the Trans Forcados Pipeline,” said the company.

“During the first four months of 2013, gross production averaged 51,300bopd. This increase was a result of the successful well work-over and drilling programme that is on-going on the fields. The installation of two additional Ovhor bulk lines has increased the flow rate of the Ovhor wells feeding into the Sapele Flowstations,” the company added.

In a deal that generated controversies in the oil and gas industry, the company had entered into SAA with NPDC in 2010.

The SAA was the result of a three-year discussion with NNPC, NPDC and the Ministry of Petroleum Resources about how to accelerate development of Nigeria’s substantial gas resources for the domestic market in Nigeria.

The three OMLs contain substantial gas reserves and the SAA provides the framework under which Septa Energy will provide funding and technical services to NPDC for the development of both oil and gas reserves.

The terms of the SAA provide that Septa fund capital and operational expenditure of the fields, as well as support the technical resources of NPDC.

– This Day