Nigerian authorities have asked Elcrest E&P to commit to gas monetisation as a condition to renewing its equity participation in a lease in the Western Niger Delta.
Elcrest acquired 45% of Oil Mining Lease (OML) 40 from Shell, TOTAL and ENI in 2012, but the subsisting licence with which these majors held the lease expires in 2019. Elcrest has, since 2012, held the lease in a Joint Venture partnership with NPDC, the operating subsidiary of the state hydrocarbon company NNPC.
The company announced that the Minister’s consent was “conditional on Elcrest payment of a Renewal bonus of $6.3Million within 90 days and a commitment from the Oil Mining Lease (OML) 40 JV to gas monetisation and additional sale 25MMSCF/Day with the gas sales agreement to be signed within 5 years”.
But while the company is currently preparing the title deed for OML 40 to conclude the renewal process, the authorities have given the nod.
“Honourable Minister of Petroleum Resources has consented to Elcrest’s renewal of its equity participation in OML 40, for a further 20 years, taking effect on 22 October 2018”, the company says in an update