Saipem, in collaboration with Nigerian firms KOA Oil & Gas and AVEON Offshore, has won a significant $1 billion contract from Shell Nigeria Exploration and Production Company Limited (SNEPCo) for the Bonga North deepwater project. This project, located 130 kilometers offshore Nigeria, involves Engineering, Procurement, Construction, and Installation (EPCI) of risers, flowlines, subsea umbilicals, and associated subsea structures.
As part of the agreement, Saipem will execute design and fabrication activities locally, leveraging Nigerian suppliers and subcontractors. While the total contract value is approximately $1 billion, Saipem’s share stands at around $900 million.
Key Collaborations and Milestones
- TechnipFMC’s Role: TechnipFMC will supply Subsea 2.0 production systems, including subsea tree systems, manifolds, jumpers, and controls, with a contract valued at $250–$500 million.
- Bonga North Details: The project, tied back to the FPSO Bonga in OML 118, includes the drilling and completion of 16 wells (8 production and 8 water injection wells). First oil is expected before the decade’s end, with peak production forecasted at 110,000 barrels per day.
Project Significance
Shell estimates Bonga North will deliver over 300 million barrels of oil equivalent (boe) in recoverable resources, bolstering the Bonga facility’s output. The FPSO Bonga, operational since 2005, achieved a milestone of producing its one-billionth barrel of crude oil in 2023.
Shell’s Integrated Gas and Upstream Director, Zoë Yujnovich, emphasized the importance of the investment:
“This project will help us maintain stable liquids production from our advantaged upstream portfolio, driving cash generation for years to come.”
Strategic Focus
Bonga North underscores Shell’s shift toward deepwater and integrated gas businesses in Nigeria. In January 2024, Shell announced plans to divest its onshore and shallow-water interests through the Shell Petroleum Development Company of Nigeria Limited (SPDC), valued at $2.8 billion, to streamline operations and enhance focus on offshore developments.
The Bonga field is operated by SNEPCo (55%) in partnership with Esso Exploration and Production Nigeria (20%), Nigerian Agip Exploration (12.5%), and TotalEnergies Exploration and Production Nigeria (12.5%) on behalf of the Nigerian National Petroleum Company Limited (NNPC).
This milestone partnership reflects the growing collaboration between global and local entities, leveraging expertise and resources to boost Nigeria’s deepwater oil and gas sector.
