Total and Petrobras have signed a Memorandum of Understanding (MOU) towards a strategic alliance covering upstream and downstream activities in Nigeria and other countries including Brazil.
According to the terms of the agreement both companies both companies will collaborate in some key areas of mutual interest and evaluate opportunities in Brazil, as well as abroad to jointly benefit from their respective experience in all segments of the oil and gas value chain.
This partnership is expected to yield further development of the Akpo fields located in ultra deepwater of Nigeria and discovered in 2000. It is situated on OML 130 approximately 200 kilometres from Port Harcourt.
A gas and condensate field, Akpo is operated by Total, holding a 24% interest in the project. Other participants in the license include CNOOC with 45% interest, Petrobras with 16%, NNPC with 10% and Sapetro with 5%.
Akpo development project includes 44 wells — 22 production wells, 20 water injection wells and two gas injection — of which 22 have already been drilled, tied-back to an FPSO indicating more work to be done.
According to the MOU, the companies will focus on upstream and gas and power. Also the deal will allow both companies to combine their experience in offshore to boost production efficiency. The partnership could also mitigate risks in projects with high investment and complexity.
Analysts say these developments portend a positive indication for Africa and encourage better policies to encourage investments.
“Governments in Sub-Saharan Africa need to revive the upstream oil and gas industry by offering attractive fiscal terms
rather than look to increase state revenues in the current climate,” says Femi Oso, senior research manager for Sub-Saharan Africa at Wood Mackenzie
In the downstream sector, Petrobras and Total will work together to develop joint services in the gas and power generation for Brazil.
The memorandum also stated that the cooperation will be extended to a broader cooperation in Brazil focused on all downstream segments in the second phase.
Currently, Petrobras and Total are associated in 15 consortiums working in exploration and production worldwide.
Nine of these projects are located within Brazil that includes development of the giant Libra area in the Brazilian pre-salt in Santos basin.
Other areas are in the Chinook field in the US Gulf of Mexico, and Bolivia’s San Alberto and San Antonio gasfields. They are also associated with the Bolivia- Brazil gas pipeline development.
This partnership is expected to yield further development of the Akpo fields located in ultra deepwater of Nigeria and discovered in 2000. It is situated on OML 130 approximately 200 kilometres from Port Harcourt.
