In a strategic move to optimize their portfolios, French energy giant TotalEnergies and Nigeria’s Conoil Producing have signed an asset swap agreement.
The deal involves TotalEnergies acquiring Conoil’s 50 per cent stake in a promising deep-water oil block (OPL257) and in exchange, Conoil will acquire a 40 per cent participating interest held by TotalEnergies in block OML136, also located offshore Nigeria.
This transaction allows both companies to play to their strengths: TotalEnergies gains more exposure to high-potential exploration, while Conoil secures a share in a stable, producing asset with immediate cash flow.
In a statement, TotalEnergies said that upon completion of the transaction, its interest in OPL257 will be increased from 40 per cent to 90 per cent, while Conoil will retain a 10 per cent interest in the offshore block. With this, TotalEnergies has moved from being the majority owner and operator to holding near-total control of the asset.
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Gaining a 90 per cent stake gives TotalEnergies overwhelming control over the strategic direction, timeline, and investment decisions for OPL 257. Experts believe the move simplifies governance and accelerates development of the asset and boosts production.
The OPL257, which covers an area of about 370 square kilometers, OPL 257 is located 150 kilometers offshore the coast of Nigeria.
This move signals a strong commitment to Nigeria’s deepwater assets, which are seen as more stable and productive than onshore operations, often plagued by security issues and pipeline vandalism.
The statement by the French energy giant said the OPL257 block is adjacent to PPL 261, where TotalEnergies (24 per cent) and its partners discovered in 2005 the Egina South field, which extends into OPL257.
“An appraisal well of Egina South is planned to be drilled in 2026 on OPL257 side, and the field is expected to be developed as a tie-back to the Egina FPSO, located approximately 30 km away.”
Commenting on the deal, Mike Sangster, Senior Vice-President Africa, Exploration & Production at TotalEnergies, said the asset swap deal with Conoil will enable the company advance its interest in offshore oil and production.
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“This transaction, built on our longstanding partnership with Conoil, will enable TotalEnergies to proceed with the appraisal of the Egina South discovery, an attractive tie-back opportunity for Egina FPSO,” Sangster stated. “This fits perfectly with our strategy to leverage existing production facilities to profitably develop additional resources and to focus on our operated gas and offshore oil assets in Nigeria,” he added.
The statement added that the completion of the transaction is subject to customary conditions, including regulatory approvals.
Pinnacle Daily reports that Dr. Mike Adenuga Jr., Chairman of Conoil Producing, and Patrick Pouyanné, Chairman and CEO of TotalEnergies, recently signed a production deal on behalf of both companies at TotalEnergies’ headquarters in La Défense, Paris.
The OML 136 is a shallow water asset with huge gas deposit. There are indications of plans to develop it to produce and supply NLNG to the local market.
Adenuga established Conoil Producing, which is a leading Nigerian independent exploration business with a portfolio of oil blocks in the Niger Delta.
While still in the exploration and appraisal phase, the OPL 257, located in the Niger Delta basin, is considered a block with high potential for significant oil and gas discoveries. Developing deep-water fields is crucial for Nigeria to boost its oil reserves and production capacity in the long term.
Victor Ezeja is a passionate journalist, scholar and analyst of socioeconomic issues in Nigeria and Africa. He is skilled in energy reporting, business and economy, and holds a master's degree in Mass Communication. He can be reached via @VICTOREZEJA on X
