Lagos, Nigeria’s commercial capital has pumped its first oil through indigenous firm Yinka Folawiyo Petroleum Company Limited (YFP), operator of the Oil Mining Licence (OML) 113 offshore Lagos.
The company announced on Tuesday that production had commenced at the field.
“The attainment of this milestone is indeed a laudable achievement not just for the YFP, but for the Nigerian oil and gas industry as a whole and indeed Lagos State, which can now be addressed as an oil-producing state,” Tunde Folawiyo, chairman of YFP was quoted to have said.
The company had been granted an Oil Prospecting License (OPL 309) in June 1991 as a Sole Risk Contract with the total area covered by the concession block being 1699 sq km. After acquiring 2D Seismic data in 1994/95, and the drilling of the Aje-1 well in 1996, the Aje field was discovered. A second well, Aje-2, was drilled the following year in 1997. After the successful drilling and testing of both wells, OPL 309 was converted to Oil Mining License (OML) 113 in 1998 with an initial term of 20 years. Aje-3 and 4 were also drilled in 2005 and 2008, respectively.
The Aje discovery lies 25 km from the coast in western Nigeria, on the border with Benin. It is situated 64 km from Lagos and close to the West Africa Gas Pipeline (12 km away).
“We are very proud of and appreciate the efforts, determination and commitment of the entire Aje project team, past and present; the constant support from our regulators, the DPR and Ministry of Petroleum; and our financiers. We believe this crucial support will spur us on to even greater achievements,” Folawiyo said.
The current Aje partnership is made up of Yinka Folawiyo Petroleum (Operator), New AGE (African Global Energy), First Hydrocarbon Nigeria Ltd (FHN), Energy Equity Resources (EER), Panoro, and Jacka Resources. The partnership was formed in August 2013.
Oil produced from the Aje field will be stored on floating Production, Storage and Offloading (FPSO) unit Front Puffin, which has production capacity of 40,000 barrels of oil per day. It can also store 750,000 barrels.
The production of oil in Lagos not only increases Nigeria’s total oil production capability, it also increases revenue for the south west Nigerian state. Oil producing states in Nigeria get 13 percent derivation from oil from the federal government.