Nigerian operator lets contract for gas processing plant

Southfield Petroleum Ltd., Lagos, has let a contract to China Machinery Engineering Corp. (CMEC), Beijing, to provide engineering, procurement, and construction services for a 250-MMcfd natural gas processing plant at Utorogu field in oil mining lease 34 about 42 km southeast of Warri, Nigeria.

CMEC’s scope of work for the project includes EPC services for the grassroots wet gas plant as well as for associated installations at the site, the engineering contractor said in a filing to Chinese exchanges.

As part of the contract, CMEC also will provide training, commissioning, technical, and other unidentified services related to the project, the company said.

Awarded on a turnkey basis, the $198-million contract covers a period of 24 months from the start of project construction.

Neither CMEC nor Southfield Petroleum, however, officially have revealed a definitive timeframe for commissioning of the project.

The EPC contract follows a previous memorandum of understanding signed between Southfield Petroleum and CMEC, which indicates that CMEC’s role as general contractor also will include delivery of EPC services for construction of a 20-Mw captive power plant, a private jetty, a 10,000-tonne LPG storage installation, an amine unit, and other various site installations and infrastructure, according to Southfield Petroleum’s web site.

Once fully commissioned, the Utorogu project will produce 200,000 tonnes/year of LPG and 120,000 tpy of condensate intended to help ease Nigeria’s heavy reliance on LPG imports and increase domestic fuel supplies for delivery to Nigerian power plants, Southfield Petroleum and CMEC said.

Background

Founded in 2007, Southfield Petroleum received the Nigerian federal government’s approval to construct wet gas management systems on a build-own-operate basis in April 2009.

The company subsequently entered an agreement with a joint venture of state-owned Nigerian Petroleum Development Co. Ltd. and independent ND Western Ltd. to process a portion of the JV’s 300-MMcfd gas production from Utorogu field.

Signed in 2014, the 10-year processing agreement is extendable by another 10 years beginning in April 2024, Southfield Petroleum said.

Discovered in 1964, Utorogu field currently produces about 10 million b/d of oil and condensate and 300 MMcfd of gas, ND Western said.

Contact Robert Brelsford at rbrelsford@ogjonline.com.

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