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FG To Revive Production At Zabazaba Oil Field

 

The Federal Government plans to revive production at Zabazaba oil field.

This was made known by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

Over the weekend, Nigeria Agip Oil Company Limited (NAOC) executives, led by Managing Director Mr. Fabrizio Bolondi, visited Engr. Gbenga Komolafe, Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

The purpose was to resume discussions on Nigeria’s deepwater oil block OPL 245, specifically the Zabazaba Field, in line with the Federal Government’s initiative to develop the oil-rich field for the benefit of Nigerians.

NUPRC revealed that steps are being taken to address all legal matters related to the Zabazaba oil field.

The aim is to facilitate the resolution of these issues and move forward with the conversion process, converting the oil prospecting license into a mining lease for commercial oil development and production.

The anticipated outcome is the Zabazaba field will contribute 150,000 barrels of oil per day, significantly enhancing Nigeria’s overall oil production.

In 1998, Malabu Oil and Gas secured an Oil Prospecting Lease for Oil Block 245 but only paid $2 million of the expected $20 million. Shell Nigeria Ultra Deep Limited (SNUD) acquired a 40% stake, leading to the 2001 revocation of the lease.

ExxonMobil and SNUD won a fresh bid in 2002. Legal battles ensued, resulting in the validation of Malabu’s rights in 2005. SNUD sought compensation at the International Centre for Settlement of Investment Disputes (ICSID, settling in 2011 with a $1.09 billion payment.

A 2011 Resolution Agreement with FGN, SNUD, and Eni governs Block 245. In 2020, a UK court rejected a $1.1 billion case against Shell and Eni over bribery allegations.

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Ongoing cases hint at the potential involvement of high-profile Nigerian officials. In July 2020, Italian prosecutors sought convictions for ENI executives in the OPL-245 license bribery case.

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