Lekoil lifts first oil from its Otakikpo field

LEKOIL, a Nigerian oil exploration company has produced its first crude cargo from Otakikpo marginal field in OML 11 located in the Niger Delta.

The cargo was lifted by Shell Western Supply and Trading Limited, subsidiary of Anglo-Dutch oil firm Shell, in respect to an agreement signed in March between the two parties. Under the contract, Lekoil is to receive within the next month, a payment for a volume of 120,000 barrels of crude that it will provide Shell’s subsidiary (at prevailing market price).

“Selling our first oil marks the commencement of cash flow from Otakikpo. Dollar receipts will increase as we further ramp up production to our Phase 1 target of 10,000 bopd and will contribute to funding Phase 2 expansion,” says Lekan Akinyanmi, Lekoil’s CEO.

Akinyanmi further said, “The production and now off take and export sale from the FSO Ailsa Craig is the culmination of our team’s hard work over the last two years to bring Otakikpo into revenue generating production.”

Current production at Otakikpo is approximately 5,000 bpd. With the commencement of regular liftings, the Company says it is focused on ramping up to production of 10,000 bpd, now expected to be by year-end.

Key components to achieve this Phase 1 milestone involve completing the expansion of onsite storage capacity currently being undertaken with minimal capex required and utilising a higher capacity shuttle tanker

The company saw its share soar by 4.1 percent when it made the announcement on May 10 on the Alternative Investment Market (AIM). AIM is a sub-market of the London Stock Exchange

Otakikpo is sited in a coastal swamp location in oil mining lease (OML) 11, adjacent to the shoreline in the south-eastern part of the Niger Delta.

LEKOIL Nigeria exercises the rights and benefits of its 40% participating and economic interest in Otakikpo via the Farm-in Agreement and Joint Operating Agreement signed on 17 May 2014 with Green Energy International Limited, the Operator.

ISAAC ANYAOGU