Dangote Group is set to realize its oil production project by actively seeking a 650,000 barrel FPSO vessel. Indeed, this major player intends to begin production on its two Nigerian oil assets, OML 71 and 72, as early as the fourth quarter of 2024. This decision comes after initial difficulties in sourcing crude oil from international oil companies.
According to information from S&P Global Commodity Insights, Dangote is looking to acquire an FPSO to produce and store crude oil in order to strengthen its refining operations. With an 85% stake in West African E&P Venture, which in turn holds a 45% operating interest in the two blocks, Dangote is positioning itself as a key player in the sector. The company is also collaborating with the Nigerian National Petroleum Company, holding the remaining 55% in this partnership.
OML Blocks 71 and 72, located in the shallow waters of the southeastern Niger Delta, host the Kalaekule and Koronama oil fields. Although the first discoveries on these blocks date back to 1966, production did not begin until about two decades later under the aegis of Shell. However, production peaked in 1999 before declining in 2003.
According to Global Commodity Insights forecasts, these fields have recoverable resources of nearly 300 million barrels of oil and 2.3 trillion cubic feet of natural gas. Production is imminent, with production forecast to reach 43,000 barrels of oil equivalent per day by 2036.
This new milestone towards the production of OMLs 71 and 72 suggests that the Dangote refinery could secure a more stable supply of crude, after facing supply difficulties for several months. This initiative marks a significant step forward for the Dangote Group in the oil sector, strengthening its position as a major player in the market.