Global Courant
Nigeria has matched Angola as the largest sub-Saharan oil drilling market this year, according to a report by Hawilti and Caverton Offshore Support Group Plc.
According to the recently published offshore platform tracker report, a total of 38 rigs have been deployed in offshore sub-Saharan Africa this year. This represents a notable increase in activity compared to the levels observed in 2022 and early 2023.
The report noted that new drilling contracts have been awarded since January in established and emerging markets, “confirming that 2023 is one of the biggest years for offshore drilling activity on the continent in a decade”.
“Nigeria has overtaken Angola to become the largest drilling market again this year, with a total of eight confirmed drilling campaigns offshore in both countries.‘ the report reads.
Nevertheless, Angola is expected to maintain a higher level of activity as most drilling campaigns in the country have already been confirmed through the second half of 2024 in support of exploratory, infill and development drilling. After Angola and Nigeria, the Republic of Congo and Gabon are the next most active offshore drilling destinations in sub-Saharan Africa.
The report notes that exploration is an important part of ongoing and planned drilling campaigns for 2023. While the results of important campaigns in Gabon and Congo are still being awaited, new contracts have been signed. TotalEnergies extended the Baltic rig contract off the coast of Nigeria to drill the Ntokon Central prospect on OML 102, while Shell selected the Noble Voyager late this year to drill a wildcat on its offshore C-10 license from Mauritania.
It is important to recognize that Nigeria’s achievement to become a major drilling market to date may have been hampered by several socio-economic factors. For example, factors bordering on gross theft and pipeline vandalism have plagued the industry for quite some time. Consequently, Nigeria missed out on the opportunity to produce and sell approx 65,700,000 barrels of oil in the past year. The price of Brent crude oil averaged about $83 per barrel between March 2022 and March 2023, meaning the country could have lost as much as N2.3tr to the threat.
It is encouraging that it is now showing signs of recovery. The country is back in business with most rig schedules extended and new contracts signed since the start of the year. Importantly, the country has two deep water platforms operating this year, including the Valaris DS-10 for SNEPCO (Shell) at its Bonga hub (OML 118) through Q1 2024, and the Gerry de Souza for TotalEnergies at its Aegina and Akpo hubs (OML 130).
The increase in drilling activity in Nigeria not only demonstrates the country’s potential for resource exploration and production, but also presents a crucial opportunity for economic growth and investment. This exploration comes at a crucial time for Nigeria. The country’s economy is currently undergoing an economic reset and this new development is one of many steps to restore investor confidence. The increased drilling activity has the potential to attract international companies, create employment opportunities and promote the overall development of the Nigerian oil and gas industry. This could have far-reaching positive consequences for the country’s economy.
Riding the oil wave: Nigeria is emerging as a leading oil drilling market in Sub-Saharan Africa.
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