- Crude oil prices rise on US, China trade deal
Barely three years after the United States energy major, ExxonMobil, made a huge discovery of hydrocarbon in the Wowo field offshore Nigeria, Italian energy giant, Eni, has announced that its affiliate, Nigerian Agip Oil Company (NAOC), has made a significant gas and condensate find onshore Niger Delta.
This is coming as oil prices rose yesterday after United States President Donald Trump predicted a trade deal with China following positive comments by Beijing, calming concerns raised by an earlier round of tit-for-tat tariff hikes.
The Eni-operated NAOC, which is jointly owned by the Nigerian National Petroleum Corporation (NNPC), 60 percent; Oando, 20 percent and Eni, 20 percent, made the discovery in the deeper sequences of the Obiafu-Obrikom fields, in Oil Mining Lease (OML) 61, onshore Niger Delta.
This discovery is expected to boost the federal government’s aspiration to grow the country’s oil reserves to 40 billion barrels and daily production to 4 million barrels per day.
In a statement yesterday from Milan, Italy, the company said the Obiafu-41 Deep well had reached a total depth of 4.374 metres.
According to the company, the well has encountered an important gas and condensate accumulation within what is known in geological parlance as the “deltaic sequence of Oligocene age comprising more than 130metres of high quality hydrocarbon-bearing sands.”
“The find amounts to about 1 trillion cubic feet of gas and 60 million barrels of associated condensate in the deep drilled sequences. The discovery has further potential that will be assessed with the next appraisal campaign,” the company said.
The company added that the well can deliver in excess of 100 million standard cubic feet per day of gas and 3,000 barrels per day of associated condensates, which will be immediately put on-stream to increase NAOC’s gas production.
“The discovery is part of a drilling campaign planned by NAOC JV and aimed at exploring near-field and deep pool opportunities as immediate time to market opportunities.
Eni has been present in Nigeria since 1962, with operated and non-operated production, development and exploration activities on a total of 30,049 square kilometers in the onshore and offshore areas of the Niger Delta.
In 2018, Eni’s equity hydrocarbon production amounted to 100,000 barrels of oil equivalent per day,” the statement added.
Meanwhile, oil prices rose yesterday after Trump predicted a trade deal with China following positive comments by Beijing, which calmed frayed nerves.
Brent crude was up 39 cents, or 0.7 percent, at $59.09 a barrel, after falling one percent in the previous slide that was the third daily decline in a row.
US West Texas Intermediate crude futures were up 57 cents, or 1.1 percent, at $54.21, after a one percent fall on Monday and heading for a fourth daily decline.
Trump said on Monday he believed China was sincere about wanting to reach a deal, while Chinese Vice Premier Liu He said China was willing to resolve the dispute through “calm” negotiations, settling global markets.
Oil prices have fallen by about 20 percent from 2019 highs reached in April, partly because of worries that the US-China trade war is hurting the global economy, which could dent demand for oil.
China’s Commerce Ministry said last week it would impose additional tariffs of five per cent or 10 per cent on 5,078 products originating from the United States, including crude oil, agricultural products and small aircraft.
In retaliation, Trump said he was ordering U.S. companies to look at ways to close operations in China and make products in the US.
The measures are prompting reactions from Chinese companies, with Sinopec seeking a tariff exemption for importing US oil in the coming months, sources told Reuters.