Nigeria 2016 | ENERGY | INTERVIEW

TBY talks to Nicolas Terraz, Managing Director of Total E&P Nigeria, on Total's diversified assets in Nigeria and the future of natural gas development in the country.

Nicolas Terraz
Nicolas Terraz was appointed Managing Director of Total Upstream Companies in Nigeria in September 2015. He is also Total Group Representative in Nigeria. Prior to his current position, Nicolas Terraz was Vice-President of New Ventures & Asset Management for Total Exploration and Production. He served as Managing Director of Total E&P France from 2011 to 2013, and as Managing Director of Total E&P Myanmar and Total Group Representative in Myanmar from 2008 to 2011. He has held positions for Total in Qatar and at the Head Office. He joined Total in 2001, after working for seven years in the French Ministry of Industry and in the French Ministry of Public Works and Transportation.

Total has a long history in Nigeria. How have your activities in the country evolved?

Total's history in Nigeria has been one of continuous development. We produced our first oil onshore from OML 58 block in 1966 and then moved into offshore developments, first in shallow waters with the Ofon and Amenam projects and then in the deepwater area with the development of Akpo field in 2009, followed by Usan in 2012 and now Egina. Today, Total has a broad and diversified portfolio in Nigeria, with activities spanning conventional onshore and offshore, deepwater, and LNG. Overall, Total is present in more than 30 production and exploration licenses, either as operator, technical advisor, or partner. Over the years, we have developed a strong partnership with the Nigerian National Petroleum Corporation (NNPC). Today, we operate four concessions in joint venture with the NNPC, both onshore and offshore, and we also operate the OML 130 deepwater concession, which contains the Akpo and Egina fields as well as the Preowei discovery. As partner, Total holds interests in the acreage operated by Shell Petroleum Development of Nigeria (SPDC), in offshore blocks OML118 and OML135 operated by Shell Nigeria Exploration and Production Company (SNEPCO), and in several licenses in partnership with Nigerian companies, including Conoil, Amni and Emo. We also hold a 15% interest in the Nigeria LNG liquefaction plant on Bonny Island. Last but not least, Total has also a significant presence in the downstream sector in Nigeria, through Total Nigeria Plc, a leader in the downstream sector of the Nigerian oil and gas industry with an extensive distribution network of over 500 service stations nationwide and a wide range of top quality energy products and services.

What is the status of the Egina field amid lower oil prices and what does it represent for Total in Nigeria?

Egina is the largest upstream project under development in Nigeria right now, undertaken by Total and its partners Sapetro, Petrobras, CNNOC and CNPC. It is also one of Total's largest operated projects worldwide. Egina involves the development of approximately 550 million barrels of oil in water depths ranging from 1,500 to 1,700 meters. The project is currently about 40% complete and production is scheduled to start in 2018 to reach a plateau at 200,000 barrels per day. Egina is a complex project that requires the integration of many different components. It also involves a very significant Nigerian content, on a much larger scale than previous deepwater projects. For instance, we developed a yard from scratch in Lagos to fabricate and install FPSO modules. When completed, some 21 million hours of work, representing 75% of the total project man-hours, will have been performed locally and 60,000 tons of equipment will have been fabricated in Nigeria.

What trends will define the future of the industry moving forward?

In the future, we can expect that the mainstay of Total's growth in Nigeria will come from deep-offshore and gas. There is a large potential market for gas in Nigeria, mostly for power generation, and there is a willingness of the government to develop the domestic gas market. Total is fully engaged in this process. Together with the NNPC, we are completing two gas pipeline projects, designed to supply the domestic market from our OML 58 production facility. One is the OUR pipeline between Obagi and Rumuekpe and the other is the NOPL pipeline to supply the Alaoji power plant. We are not investors in the power generation sector in Nigeria. Our focus is rather to bring gas to the domestic market, by making the necessary investments in the upstream production facilities and in pipeline facilities.