American oil giant, ExxonMobil has indicated its plan, in collaboration with its joint venture partners, to soon declare readiness to proceed with the Final Investment Decisions (FIDs) on some major deep-water projects in Nigeria cumulatively valued at approximately $10 billion.

The investment would start with the infill drilling campaign at the existing producing Usan deep-water asset estimated at over $1 billion, of which Exxon has already made a 30 per cent commitment and aims to declare its investment readiness in a matter of months.

With a couple of investments and projects lined up, the company has also set an ambitious target of growing its total oil production in Nigeria from the current 100,000 barrels per day (bpd) to 250,000 bpd in the next five years.

Chairman and Managing Director of ExxonMobil Affiliate in Nigeria, Mr. Jagir Baxi, disclosed the plans during an interview with THISDAY in Lagos, at the back of the recent celebration of 20 years anniversary of uninterrupted oil production at the Erha oil producing asset by Esso Exploration and Production Nigerian Limited (EEPNL), Exxon's affiliate and operating firm in Nigeria.

As reported, ExxonMobil had in September 2024 during a meeting between its executives and Vice President Kashim Shettima in New York announced its decision to invest $10 billion in deep-water oil projects in Nigeria, expecting to unlock at least 180,000 bpd.

Central to that investment is the Owowo deep-water asset, which holds between 500 million and one billion barrels of oil reserve, and whose development requires a tie-back to the company's nearby Usan Floating Production, Storage and Offloading (FPSO) facility.

ExxonMobil holds 27 per cent interest in the Owowo asset and is the operator, while Joint Venture Partners include Chevron Nigeria Limited (27 per cent), TotalEnergies E&P Nigeria Limited (18 per cent), Nexen Petroleum Deepwater Nigeria Limited (18 per cent), and the Nigerian National Petroleum Company Limited (NNPC) (10 per cent).

Giving the latest information about the planned investments, Baxi said the company was embarking on an infill drilling campaign on the Usan field in order to recover more resource in it as shown by seismic results. Though part of the original Usan reservoir, Baxi explained that the project would require new infrastructure, brand new wells, new subsea connections, and leverage the Usan FPSO capability and capacity that exists today.

He stated, "Back to the comment I made about seismic result, it became clear that there is resource, it's material, it's valuable, it can be produced with relative speed, different from a brand-new greenfield FID. We do plan to declare the investment ready in a short while."

Baxi said the company had been working with all stakeholders, including NNPC Ltd as the concessionaire, their partners in OML 138, the regulators – Nigerian Content Development and Monitoring Board (NCDMB) and Nigerian Upstream Petroleum Regulatory Commission (NUPRC) – to achieve all the relevant requirements needed to take the FID.

He disclosed that the investment for the Usan infill drilling programme was worth about $1 billion and ExxonMobil had already made 30 per cent commitment from that in the early works.

Baxi said, "And we are closing in on the point where all the important execution enablers will be clear and in place, and provide us the basis to declare that investment as ready to go. So, we're excited that it's close to the point you made. It will provide new production from deep-water in the near term.

"Within months of the campaign starting, we'll be able to produce from this investment. The investment runs through almost all next year as a total campaign. It's worth about one billion dollars in total, and we have already committed around 30 per cent of that in the early works, the early long-lead equipment and in the foundational contracts."

For Owowo, a major deep-water asset awaiting FID, Baxi said the total investment required for its development was between $7 billion and $8 billion. "You should think about Owowo at the seven to eight-billion-dollar range plus," he said.

Baxi described Owowo as the tip of the spear and "the one that we are also maturing rapidly behind Usan infill as the lead investment". Explaining the size of the Owowo asset, he said in a full development case, it would be 20 to 40 wells, more than the Erha and Bonga tiebacks, which are in the 10 to 15 wells range, respectively.

According to him, those tiebacks are a single kilometre away while Owowo is 30 plus kilometres away. In terms of well counts, Baxi said Owowo will be at least twice as big as Bonga North, another large deep-water oil asset being operated by Shell Nigeria Petroleum Company Limited (SNEPCo), which is currently under development at an investment size of $5 billion.

The ExxonMobil chair explained, "Resource size, you can characterise Owowo as at least 50 per cent or more, larger than either the Erha North tieback or the Bonga North tieback to Bonga. It's a truly big field, but its geography is spread more than Erha or Bonga today are."

Although he did not specifically say when the FID on the Owowo development or Usan infill drilling programme will take place, Baxi said the maturity of all the thinking that had to occur prior to the declaration was in flight.

He stated, "And what I hope we'll be able to be more open about with stakeholders, like you and others, is when we can point to the formative announcements or formative agreements like long lead procurement, like establishing shore base capability to support that. These will be the visible early signals before FID, just like we did with Usan field.

"That's the journey we're on. So, when we make an FID announcement, we do it with the partners clearly aligned with us, the stakeholders clearly aligned. It's a signal to go. We're not interested in making an announcement that looks like we want to go. That's not the ExxonMobil way. We want certainty, we'll work for certainty, and we'll commit to what we say we will do as operator and move to it."

In five years, Baxi said ExxonMobil, through Esso, would be able to hit total production of 250,000 bpd in Nigeria, up from the current 100,000 bpd output, and also deliver 100 million standard cubic feet per day in gas production.

He explained that both the infill drilling campaigns in Usan and Erha and the development of the bigger Owowo field will unlock a combined 160,000 bpd in oil production and deliver about 100 mmscf/d. He said the brownfield Usan and Erha will unlock additional 40,000 bpd and 20,000 bpd, respectively, while the greenfield Owowo project will deliver 100,000 bpd of oil and 100 mmscf/d of gas outputs.

Baxi said, "So, to your question if we can see a future of 250,000 or 200,000 barrels, yes, it is definitely a possibility as we put these investment pieces together. We are motivated to try and do more than that, actually. I mentioned Owowo project comes with an expectation of a gas pipeline that can unlock gas from Owowo and Usan to shore."

He praised the current government for creating the enabling fiscal regime to incentivise new investments in the Nigerian oil and gas deep-water space. Baxi said ExxonMobil and the partner group had been working and inspired by the administration's enabling announcements through 2024, referring specifically to Presidential Executive Directives 40, 41, 42, which are incentives on national content and contracting.

He added that the journey since the Field Development Plan (FDP) for Owowo was approved had been to take each one of those intents and translate them to project-specific outcomes.

Baxi stated, "You've heard me say this before, I believe the project-specific enablers required to be defined from those directives. So, for example, national content directive translates to an Owowo-specific national content strategy. The contracting and efficient cycle time of contracting translates to an Owowo contracting strategy. And the incentive structure translates to an Owowo incentive analysis. That's been the work since our divestment concluded."