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First Oil from Nigeria's Deepwater Bonga Field

This week, Royal Dutch Shell announced it had shipped its first consignment from Bonga – the first deepwater oil and gas field in Nigeria. The initial shipment was 200 thousand barrels. The development cost to produce the first oil from Bonga is put at more than three and a half billion dollars.

For a look at the significance of the announcement, English to Africa reporter Joe De Capua spoke to Andrew Hayman of IHS Energy, an industry consulting firm.

“It’s the first giant oil field in deep waters off the coast of Nigeria. And the production will ramp up in 2006 to about 200,000 or 225,000 barrels a day, which is an increase of 10% on the national oil production,” he says.

Producing oil offshore also affords oil firms greater security. Mr. Hayman says, “This is a good 100 kilometers offshore, I believe, and is way out of range of civil disturbances, which have affected onshore production.”

The United States imports oil from Nigeria as well as from other African countries such as Angola, where oil production is growing following its long civil war.” Mr. Hayman says, “Both of these countries are principle suppliers to the US. Nigeria, I believe, is number five in the ranking of importers to the (United) States, and Angola, I think, is number seven. There are huge deposits of oil in the deep offshore regions of both of these countries. And over the next five or ten years you’ll see supplies ramping up and coming into the east coast of the (United) States to the refining plants there.”

Currently oil production in Angola is just barely surpassing that of Nigeria, but the analyst says the momentum swings both ways.