Can you give an overview of Neconde Energy and the company’s operations in Nigeria?

Neconde Energy (Neconde) is a leading independent oil and gas company in Nigeria and is the JV owner of the OML 42 asset. This asset was acquired from Shell approximately 12 years ago and significant resources and capital were deployed into a rehabilitation program. We have been working on increasing production to where it sits in the regions today of about 35,000 bpd. In addition to oil, OML-42 has approximately 3.8 Tcf of gas resources that are planned to be developed towards delivering about 500 mmscf/d to domestic and international gas markets. In a joint venture with NEPL, Neconde is also rehabilitating and investing capital in gas infrastructure. The OML-42 asset has been supporting the domestic market since 2018 through the Escravos-Lagos Pipeline System (ELPS) with plans to put in more volumes by the end of 2024.

Today, Neconde has four producing fields and as an indigenous company, our operations offer a viable option through which the currently under-developed reserves of the Niger Delta could be brought into exploration with attendant potential economic and social benefits for the region and country at large. There is also the opportunity to utilize the associated and non-associated gas produced for increased domestic use, resulting in significant socioeconomic benefits. 

As the Trans-Forcados Pipeline (TFP) infrastructure being used to evacuate the oil resources in the region where OML-42 is located is now very old and in poor condition, along with additional issues such as crude theft and vandalization of pipelines in the Niger Delta area, we created an alternative crude evacuation (ACE) system where we move the crude in barges to the Ugo Ocha Export Terminal  FSO. Implementing this evacuation alternative has necessitated introducing oil and water handling in the field to meet export crude quality requirements and environmental standards for water disposal. The alternative evacuation solution for the Egwa, Odidi, and Jones Creek fields has been in use for several years while the Batan field still makes use of the TFP and the FOT terminal. Security still remains an issue in the Niger Delta, and Neconde is continuously implementing different and evolving solutions to secure our crude and ensure that what is extracted from the well is what we get out at the end of the system. In terms of increased crude production plans, we have begun well workover programs which will continue into late 2024 and a planned infill drilling in early 2025. In summary, the plan is to increase both crude and gas production by working together with our JV partners.

What are the challenges and opportunities of operating in Nigeria? 

The main challenges are hinged in the area of the ease of doing business for the private sector. We need to look at the policy issues, forex exchange mismatch, multiplicity of agencies and the plethora of fees that hound the business environment. This is an industry that requires huge dollarized investments and those investments need to be protected. 

Can you elaborate on Neconde’s sustainability approach and CSR commitments? 

Neconde is committed to ensuring minimal environmental impact on communities in our oil and gas field regions, and we aim to promote high standards in quality, health, safety, and environmental performance. We also aim to improve the quality of our products and services while protecting the lives and environment of the communities in which we operate. We seek to promote the socio-economic development of Nigeria through our operations, and we continue to pursue partnerships with local partners as well as the employment of local talent within our operating communities. We are focused on best business practices, respecting human and cultural diversity, contributing to sustainable development, and reducing social inequality. In line with the PIA, we and our JV partner have recently inaugurated four OML-42 communities’ Board of Trustees to manage the Host Communities Development Trust Funds as stipulated in the Act. We are also trying to drive a focus on inclusion and diversity, especially empowering women in the oil and gas sector where we aim to create awareness and opportunities to carry women along in this very male-dominated industry.