Natural Gas

Nigeria’s natural gas reserves are estimated by the Nigerian National Petroleum Corporation (NNPC) to be 187 Tcf in 2006, ranking Nigeria to be the seventh largest natural gas reserves holder in the world. To date this resource has been underdeveloped due to the primary focus of the industry on oil resource development for export. However, now the Nigerian government has announced its objective to increase natural gas revenue sales and secure flares down for all operations.

Addax Petroleum has committed considerable resources towards ceasing gas flaring, working throughout 2008 to extinguish its part of the flare in OML124 and OML126, and is working with NNPC’s National Petroleum Investment Management Services (NAPIMS) on a plan for the cessation of gas flaring in OML123.

For OML124, incremental gas compression has been installed to allow for gas re-injection and flares down, which is expected to be achieved in April 2009.

For OML126, a secondary recovery scheme is being implemented whereby all produced gas will be re-injected for enhanced oil recovery. The target for OML126 flares down is early May 2009.

For OML123, a comprehensive field reconfiguration project is being planned, with centralized gas gathering, oil processing and water injection as key features, aiming to optimize future production from this cluster development while extinguishing the flare by gas export for power generation and / or re-injection. The project design is still being finalized and a date for cessation of flares has not been set.