before end 2019, Dangote Industries should add crude oil production to its assets

(Ecofin Agency) - In Nigeria, the conglomerate Dangote Industries is expected to add oil production to the list of its activities before the end of the year. The announcement was made by the joint venture of the state-owned petroleum company (NNPC) and WAEP, the Upstream petroleum branch of the conglomerate controlled by tycoon Aliko Dangote.

Indeed, work has been underway since last year to modernize the facilities and relaunch production on the site (Kalaekule field) which formerly belonged to Shell, Total and Eni. They should come to term soon.

Dangote Industries acquired, in March 2015, as part of a joint venture with NNPC, an 45% interest in the 71 and 72 OML licenses, against an 300 million dollar envelope. Shell, Total and Eni then gave up the perimeters to face the difficulties caused by the drop in oil prices.

Kalaekule, which overlaps the two blocks, in the shallow sea, in the central Niger Delta basin, was in production between 1985 and 2002, with a peak of 22 000 barrels per day in 1999. The joint venture NNPC / WAEP now hopes to start an initial production of 2 000 barrels per day.

"We have indeed established that some wells can flow and we have made minor renovations of the platform (...) All indications that production can start before the end of the year"said National Petroleum Investment Management Services (NAPIMS), a branch of the NNPC that oversees the project.

Dangote Industries' involvement in the oil sector is primarily due to the refinery of 650 000 barrels per day expected to come on stream in 2020. Ultimately, WAEP plans to process oil extracted from OML 71 and 72 licenses.

Olivier de Souza

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