- Project starts up five months early and $400 million under budget
- Daily oil production to increase by 65,000 barrels per day
- Subsea development ties into existing infrastructure for capital efficiency
Public Company Information:
IRVING, Texas--(BUSINESS WIRE)--Exxon Mobil Corporation (NYSE:XOM) announced today that its subsidiary, Esso Exploration and Production Nigeria Limited, has started oil production ahead of schedule at the Erha North Phase 2 project offshore Nigeria.
The Erha North Phase 2 project is a deepwater subsea development located 60 miles offshore Nigeria in 3,300 feet of water and four miles north of the Erha field, which has been producing since 2006. The Erha North Phase 2 project includes seven wells from three drill centers tied back to the existing Erha North floating production, storage and offloading vessel, reducing additional infrastructure requirements.
The project is estimated to develop an additional 165 million barrels from the currently producing Erha North field. Peak production from the expansion is currently estimated at 65,000 barrels of oil per day and will increase total Erha North field production to approximately 90,000 barrels per day.
“Executing successful projects such as Erha North Phase 2 ahead of schedule and under budget results from ExxonMobil’s disciplined project management approach and expertise,” said Neil W. Duffin, president of ExxonMobil Development Company. “We are able to create additional shareholder value by optimizing existing infrastructure, which reduces capital spending requirements and improves capital efficiency.”
Duffin said the ahead-of-schedule startup was supported by strong performance from Nigerian contractors, which accounted for more than $2 billion of project investment for goods and services, including subsea equipment, facilities and offshore installation.
“These contracts are bringing direct and indirect benefits to the Nigerian economy through project spending and employment, consistent with project objectives,” Duffin said.
ExxonMobil expects to increase its global production volumes this year by 2 percent to 4.1 million oil-equivalent barrels per day, driven by 7 percent liquids growth. The volume increase is supported by the ramp up of projects completed in 2014 and the expected startup of major developments in 2015.
The Erha North field was discovered in 2004 and initial production commenced in 2006. Operator Esso Exploration and Production Nigeria Limited holds a 56.25 percent interest in Erha North Phase 2, while Shell Nigeria Exploration and Production Company holds the remaining 43.75 percent share.
CAUTIONARY STATEMENT: Statements of future events or conditions in this release are forward-looking statements. Actual future results, including project plans, schedules, costs, and capacities; production rates; ultimate recoveries; and global volume growth could differ materially due to changes in market conditions affecting the oil and gas industry or long-term oil and gas price levels; political or regulatory developments; reservoir performance; timely completion of development projects; technical or operating factors; the outcome of future commercial negotiations; and other factors. References to oil and gas volumes in this release may include quantities that are not yet classified as “proved reserves” under U.S. SEC definitions but that we expect will ultimately be produced and moved into the proved reserve category. The term "project" as used in this release does not necessarily have the same meaning as under any government payment transparency reporting rules.
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