THE Nigerian National Petroleum Corporation, NNPC, on Tuesday closed a $3.15 billion deal with Sterling Oil Exploration and Energy Production Company Limited, SEEPCO, to develop the country’s oil and gas reserves from Oil Mining Lease, OML 13, it revealed in a Twitter post.

The Group Managing Director, GMD, of the NNPC, Mele Kyari, in his statement described the funding arrangement as “a game-changer to oil and gas project financing in Nigeria”.

“The project is expected to earn over $10.2 billion in royalties and taxes from the project over the next 15 years, while NNPC would earn over $5 billion after payment of the entire financing obligation,” he said.

Kyari, who was represented by the NNPC, Chief Operating Officer, Upstream, Roland Ewubare, praised President Muhammadu Buhari, for approving the transaction, adding that OML 13 held strong potentials both for the petroleum industry and the nation’s economy.

OML 13 is an onshore oil block on the eastern Niger Delta with an acreage of 1,923 square meters. It hosts the Utapate South and Ibibio fields, and several producing marginal fields.

Nigerian Petroleum Development Company, NPDC, an upstream subsidiary of the NNPC which acts as an operator on behalf of the NNPC had been seeking third party financiers to raise funds to develop its crude reserves and increase oil and gas production from Oil Mining Lease 13.

He disclosed that the acreage boasts of over 926 million stock tank barrels, mmstb, and 5.24 trillion cubic feet, tcf, respectively of oil and gas reserves.

He also, added that the financing and technical services agreement was for a period of 15 years while the $3.15 billion ceiling funding would be provided by SEEPCO with a 10-year capital investment period and five years for cost recovery.

The oil block was expected to have kicked -off in January with a 200,000 barrels per day crude oil supply but it has consistently failed to meet its target.