Shell, Partners sign FID on 300m barrels Bonga North Deep-water Project

A final investment decision (FID) for the deep-water project Bonga North off the coast of Nigeria has been announced by Shell Nigeria Exploration and Production Company Limited (SNEPCo), a division of Shell Plc.

In a statement released Monday from London, Shell made this announcement without mentioning the project’s cost.

The Bonga Floating Production Storage and Offloading (FPSO) complex, in which Shell has a 55 percent stake, will be connected to Bonga North by a subsea tie-back.

According to the statement, the Bonga North project entails installing new subsea hardware connected to the FPSO, modifying the current Bonga Main FPSO, and drilling, finishing, and starting up 16 wells—eight production and eight water injection wells.

The project will keep the Bonga facility producing gas and oil. With an estimated recoverable resource volume of over 300 million barrels of oil equivalent (boe), Bonga North is expected to attain a peak production of 110,000 barrels per day by the end of the decade. The first oil is expected to be produced.

In the release, Shell’s Integrated Gas and Upstream Director Zoë Yujnovich said, “This is another significant investment, which will help us to maintain stable liquids production from our advantaged Upstream portfolio.”

For the next ten years, Shell’s dominant Integrated Gas and Upstream division will continue to generate income thanks in part to Bonga North.

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On behalf of the Nigerian National Petroleum Company Limited (NNPC), SNEPCo, which holds a 55 percent stake, manages the Bonga field in collaboration with Esso Exploration and Production Nigeria Ltd. (20 percent), Nigerian Agip Exploration Ltd. (12.5%), and TotalEnergies Exploration and Production Nigeria Ltd. (12.5%).

At sea depths of more than 1,000 meters, Bonga is a deep-water development situated in OML 118. The Bonga FPSO, which has a daily production capacity of 225,000 barrels, started production in 2005. In 2023, the project’s one-billionth barrel of crude oil was produced.

Over 300 million barrels of oil equivalent (boe) are expected to be recoverable resource volumes in the Bonga North development. According to the Petroleum Resources Management System of the Society of Petroleum Engineers, these volumes are presently categorized as 2P (proven and probable).

According to the International Oil Company (IOC), the above-mentioned recoverable resources and predicted peak output represent 100% of total gross statistics.

It insisted that the internal rate of return (IRR) from the investment in Bonga North was anticipated to be higher than the hurdle rate for Shell’s upstream operations.

Through near-field prospects like Bonga North, Shell’s Upstream division continues to create new performance standards by utilizing technical know-how, solid relationships, and a model based on simplification and replication.