Although Nigeria has been a volatile region characterized by unrest in recent years, the country is still one of the largest oil producers in the world.
The Nigerian economy is closely tied to the oil sector, and the country’s oil industry officials have encouraged local content inclusion. In 2009, Nigeria was the 8th largest OPEC oil producer, averaging approximately 1.8 MMb/d during the year.
Much of the oil and gas activity in the country is centered on the Niger River Delta area where security has been a problem for the oil industry in recent years.
General unrest in the country has resulted in its oil output declining almost 35% from peak levels in the 2004/2005 timeframe. Although Nigeria has faced its share of challenges, some 36 Bbl of proven oil reserves in the country are attractive to International Oil Companies (IOCs), and there is a robust local market for contract drilling and oil services. Some key exploration and development players working on projects in Nigeria include Shell, ExxonMobil, Chevron, ConocoPhillips, Total, ENI/Agip, and Addax Petroleum.
Notable early- to mid-stage offshore field developments in Nigeria include the Greater Ebok-Okwok Complex, Akepo, and Egina. High profile producing projects include Agbami, Usan, and Erha.
Nigerian National Petroleum Corp. (NNPC) was created to provide oversight and regulation for the Nigerian oil industry in 1977. The lion’s share of the projects in the region are structured as joint venture arrangements with NNPC taking a majority stake, and IOCs acting as operators with a minority stake.
Drilling contractors with a presence in Nigeria include Transocean, Noble, Seadrill, Stena, Seawolf, and Frontier Drilling. Currently, 10 jackups, three deepwater semisubmersibles, and three drillships are in Nigeria, and all but one jackup are contracted.