Business
Firms, ExxonMobil Sign Crude Handling Pact
A group of Nigerian exploration and production companies comprising Frontier Oil Limited, Universal Energy Resources Limited and Network Exploration and Production Nigeria Limited, has signed a Crude Handling Agreement with Mobil Producing Nigeria Unlimited, a subsidiary of ExxonMobil.
The group, which is known as the FUN group operates oil fields, located in Oil Mining Leases 13 and 14 in Akwa Ibom State, onshore south Eastern Nigeria.
Frontier Oil is the operator of the Uquo marginal field; Universal Energy Resources is operator of the Stubb Creek marginal field, while Network Exploration and Production operates the Qua Iboe marginal field.
The Executive Director of Network Exploration and Production Nigeria Limited, Chief Femi Olagbende, said in a recent statement that the agreement had ushered in a new era of co-operation between indigenous operators and the International Oil Companies operating in Nigeria.
Olagbende said the signing of the agreement symbolised a major milestone for the FUN group in their quest to develop their respective marginal fields using ExxonMobil’s Qua Iboe Terminal facility as export route for their treated crude oil and condensate.
According to him, the use of MPNU facilities at QIT provides a significant economic advantage to the FUN group.
“The events leading to the signing of this agreement date back to 2003 when the Federal Government through her oil and gas industry regulatory agency, Department of Petroleum Resources, awarded several marginal fields to indigenous oil field operators. Due to the relatively small sizes of these hydrocarbon resources, the need to seek a cost effective storage and sales outlet for the crude became a key factor in determining the viability of developing these marginal fields,” he said.
He added, “At the beginning of discussions in 2004, the three companies approached MPNU individually to seek permission to use QIT to export their crude.
“MPNU instead suggested that the three companies work together and form a consortium with the understanding that their crude would be sent to QIT through a single oil pipeline instead of through multiple pipelines.