Nigeria 
New oil discovery in deepwater Nigerian block

afrol News, 16 May - The multinational ChevronTexaco Corporation has announced its second oil discovery on a deepwater Nigerian block. The new offshore oil discoveries are set to substantially raise Nigeria's crude production capacity and federal incomes. Offshore oil is federal property, contrary to the diminishing land-based resources.

Chevron Petroleum Nigeria Limited, an affiliate of ChevronTexaco, announced the discovery on the deepwater block OPL 222, which is operated by Elf Petroleum Nigeria Ltd. The exploration oil discovery well is located approximately 100 kilometres offshore in a water depth of 750 meters. "We are delighted by this latest discovery," said George Kirkland of ChevronTexaco. The drilling offshore Nigeria was "an integral part of ChevronTexaco's growth strategy for West Africa," he added. 

Also the Nigerian government had reason to be thrilled by Chevron's latest discovery. In April, the Nigerian Supreme Court had decided that all areas outside the low-water mark of the coastal states are federal property, meaning that the coastal Nigerian states would not have the right to a share of the revenue of oil production there. 

Only in year 2000 it had been decided that the revenues from natural resources produced in one state are shared between that state and federal government. This federal concession came after years of conflict - sometimes even armed conflict - over control of local resources. Especially the local population of the oil-rich and now polluted Niger Delta had demanded some compensation. The recourse conflict also mirrored a long-standing Nigerian conflict between federal and state authorities, generally won by state authorities.

With an emphasised focus on offshore and deepwater oil exploitation - a development furthered by both the federal government and oil companies - federal treasury is set to gain the upper hand again. For now, however, all production is still onshore. 

There is a number of drilling operations going on offshore Nigeria, expected to raise the Nigerian oil reserves and production significantly over the next years. Oil companies are also more eager to produce offshore to safeguard the security of their personnel and avoid conflicts with local communities and environmentalists.

Sources: Based on Chevron and afrol archives

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