Nigeria has divided its valuable OPL 245 deepwater oil block into four new assets that Shell Plc and Eni SpA will jointly develop, paving the way for production at one of Africa’s largest and most disputed untapped oil reserves, according to a source familiar with the decision.
Officials expect to begin signing the final contracts, the source said, requesting anonymity because the government has not yet made a formal announcement.
Eni and Shell declined to comment, while Nigeria’s state oil company, the Nigerian National Petroleum Company, also did not immediately respond to requests for comment.
The agreement represents a major shift for OPL 245, a deepwater block estimated to contain up to 9 billion barrels of oil that has remained undeveloped for nearly three decades due to overlapping legal battles and a high-profile corruption investigation.
An oil sector analyst based in Lagos described the resolution as one of the longest disputes in African energy history and said bringing the field into production could significantly boost Nigeria’s output plans.
The dispute dates back to 1998, when Nigeria awarded the license to Malabu Oil and Gas, a company linked to former petroleum minister Dan Etete during the military government of Sani Abacha. Malabu later transferred the license to Shell and Eni in a deal worth $1.3 billion.
Italian prosecutors later alleged that much of the payment went to politicians, officials, and intermediaries instead of Nigeria’s treasury. The claims led to a major criminal trial in Milan involving both companies and several senior executives, including Eni CEO Claudio Descalzi. All defendants denied wrongdoing, and an Italian court cleared them of all charges in 2021.
Despite the acquittal, the case damaged reputations and prolonged uncertainty around the project’s future.
Nigeria’s government has repeatedly pushed to resolve the dispute and advance production, aiming to strengthen oil revenues as output from older onshore fields declines because of theft and aging infrastructure.
Nigeria has recently produced about 1.5 million barrels per day, below both its OPEC quota and national targets, increasing pressure on authorities to accelerate development of new oil assets.
Officials view the decision to split the block into four operating units as a way to speed up approvals, financing, and development planning while allowing Shell and Eni to share operational risks.
Shell has been reshaping its Nigerian portfolio by selling several onshore assets amid ongoing security and community challenges, and the company considers deepwater projects like OPL 245 more aligned with its current strategy. Eni has continued to focus on long-term deepwater exploration and production in West Africa.
With estimated reserves of 9 billion barrels, OPL 245 stands among Africa’s largest undeveloped oil discoveries. Full development could add hundreds of thousands of barrels per day to Nigeria’s production and strengthen its fiscal outlook and position within OPEC.
Even so, development will take time. Projects of this scale require years of engineering work, environmental approvals, and infrastructure construction, and industry analysts expect first oil could still be about a decade away under optimistic timelines.
source: businessday.ng
African Energy Council