Africa

Nigeria

Our share of production, onshore and offshore, in Nigeria was approximately 278 thousand boe/d in 2015, compared with approximately 300 thousand boe/d in 2014. Security issues and crude oil theft in the Niger Delta continued to be significant challenges in 2015.

Onshore

The Shell Petroleum Development Company of Nigeria Limited (SPDC) is the operator of a joint arrangement (Shell interest 30%) that has 17 Niger Delta onshore OMLs, which expire in 2019. Of the Nigeria onshore proved reserves, 196 million boe are expected to be produced before the expiry of the current licences and 402 million boe beyond. To provide funding, modified carry agreements are in place for certain key projects and are being reimbursed.

SPDC supplies gas to Nigeria LNG Ltd (NLNG) mainly through its Gbaran-Ubie and Soku projects. As part of the strategic review of its interests in the eastern Niger Delta, SPDC has divested its 30% interest in OMLs 18, 29, and the NCTL. OML 25 is held for sale, subject to the resolution of pending litigation. Additional divestments may occur as a result of the strategic review.

The level of crude oil theft activities and sabotage in 2015 was significantly lower than in 2014, following the divestment of OMLs 18 and 29, and the NCTL in 2015.

Offshore

Our main offshore deep-water activities are carried out by SNEPCO (Shell interest 100%) which has interests in four deep-water blocks, under PSC terms. SNEPCO operates OMLs 118 (including the Bonga field, Shell interest 55%) and 135 (Bolia and Doro, Shell interest 55%) and has a 43.75% interest in OML 133 (Erha), where we are not the operator, and a 50% interest in oil production lease 245 (Zabazaba, Etan). SNEPCO also has an approximate 43% interest in the Bonga South West/Aparo development via its 55% interest in OML 118. After close consultation with our partners, it is clear that the Bonga South West deep-water project requires further project cost reductions to make it economically viable in the current business environment. An FID is not expected before 2017.

First oil was produced in the third quarter of 2015 from the Bonga Phase 3 development. It is expected to contribute some 50 thousand boe/d at peak production through the existing Bonga FPSO export facility.

First oil was also achieved in the third quarter of 2015 from the Erha North Phase 2 development. The project, in which SNEPCO has a 43.75% interest, is a tie-back to the Erha FPSO. The Phase 2 development is expected to result in around 120 million recoverable barrels of oil from the field.

Five shallow-water licences (OMLs 71, 72, 74, 77 and 79) were renewed in December 2014 and will expire in 2034. In 2015, we sold OMLs 71 and 72, both of which were non-producing.

Egypt

Onshore

We have an interest in BAPETCO, a non-operated joint venture between Shell and the Egyptian General Petroleum Company. Onshore operations are located in the Western Desert and we have an interest in nine oil and gas producing development leases in the Badr El Din & Obaiyed, as well as three exploration concessions (North East Obaiyed, North Matrouh and North East Alam El Shawish).

Offshore

We have interests in two gas-producing areas offshore the Nile Delta – where Rashpetco (Shell interest 40%) is the operator of the Rosetta concession (Shell interest 80%) and Burullus (Shell 25%) is the operator of the West Delta Deep Marine concession (WDDM, Shell interest 50%).

We also have development rights over the Harmattan Deep discovery and (subject to execution of a development lease) the Notus discovery offshore the Nile Delta (Shell interest 60%).