IPPToday #224: Total launches US$1.2 billion offshore oil production project in Angola
This article is part of a daily series of IPP articles. If you want to know more about the latest power generation projects globally visit our IPP Today section. You can receive them by email on a daily basis.
Total and its partners have launched the Zinia 2 project, a deep offshore short-cycle development in an area 150km off the coast of Angola, known as Block 17. The launch follows the developers' final investment decision (FID) to proceed with the project, which has a budget of US$1.2 billion.
Having begun operations there in 1997, Total owns a 40% stake in Block 17, alongside affiliates of Equinor (23.33%), Exxon Mobil (20%), and BP (16.67%). Sonangol is the concessionaire. The block has four floating storage, production and offloading (FPSO) units which were gradually brought on stream between 2001 and 2014. In 2017, its production averaged 600,000 barrels per day.
Zinia 2 is one of fifteen reservoirs in the block. It comprises nine wells in water depths ranging from 600 to 1,200 meters, tied back to the Pazflor FPSO. It will have a production capacity of 40,000 barrels per day.
Zinia 2 is the first of several possible short-cycle developments in Block 17 that Total intends to realise through connecting satellite reservoirs to the existing FPSO units. Such satellite developments are facilitated by a favorable fiscal framework recently introduced by the Angolan authorities.
Arnaud Breuillac, President of Total Exploration & Production, commented on the FID,
“Zinia 2 opens a new chapter in the history of Block 17. This project will allow to extend the profitability of this prolific block, with over 2.6 billion barrels already produced ... [it] is also a good example of capex discipline and cost optimization: the work carried out to simplify the design while capturing deflation allowed the partners to cut the development costs by more than a half.”
In addition to this announcement, this week Total has also signed two agreements relating to future operations in Angola. One is a framework agreement for a future joint venture between Total and Sonangol to jointly develop a network of service stations in Angola, including petroleum product logistics and supply; and the other is a risk service agreement for the exploration license of another deepwater block, which Total will operate.
Furthermore, later this year, the first FPSO in another of Total's deep offshore projects in Angola is expected to begin operating, further cementing the company's position as the leading oil operator in the country.