Akpo, Nigeria, Commercial Asset Valuation and Forecast to 2028 - a new market research

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24.01.2012 11:22:47 -

( - announces that a new market research report related to the Oil and Gas energy industry is available in its catalogue.

More information regarding this report:Akpo, Nigeria, Commercial Asset Valuation and Forecast to 2028

Akpo, Nigeria,


Commercial Asset Valuation and Forecast to 2028


The Akpo field is located 160 km off Port Harcourt in Nigeria. The water depth of Akpo varies from 1,100m to 1,700m. The area of the field is 100 square kilometers. Akpo was discovered in the year 2000 and project was sanctioned in the year 2005. The production from Akpo contributes to nearly 9% of Nigeria’s total production. Previously, Akpo was operated under Oil Prospecting License (OPL)-246 but now it comes under Oil Mining Lease (OML)-130. Akpo is one of the largest deep underwater offshore projects. It was one of the largest oil production fields in the year 2009.

Total Upstream Nigeria Limited (TUPNI), a subsidiary of Total SA is the operator of Akpo field with 24% equity stake. The other equity partners are Nigerian National Petroleum Corporation (NNPC), South Atlantic Petroleum (Sapetro) of Nigeria, Chinese National Offshore Oil Company (CNOOC) of China and Petrobras of Brazil.

Akpo field produces condensate having 45.17°API and 0.06 % sulfur. The temperature at the reservoir is at a maximum value of 112°C and has a maximum pressure of 700 bars. Due to these conditions the trapped hydrocarbons inside the reservoir are light. The fluid separates into condensate and gas after extraction from the well.

The proved and probable reserves in the field are estimated to be 620 MMbbls of condensate and 1 Tcf (terra cubic feet) of gas. The production from Akpo started in March 2009 and during 2009 it produced 51.01 MMbbls of condensate and 85,159 MMcf of natural gas.

Akpo is expected to produce for about 20 years with complete abandonment by 2028. It is expected to generate $63.02 billion in revenue (undiscounted) during its remaining life (starting January 1, 2010) and is expected to yield an IRR of around 37.1%.


- The report provides detailed information on oil and gas production, infrastructure, reserves, geology, operator and equity partners and the latest fiscal terms applicable to the asset and provides its fair value (Remaining Net Present Value) based on remaining reserves, forecast production, capital and operational costs, fiscal regime and commodity prices.
- The report also provides additional valuation parameters like Internal Rate of Return (IRR), Profitability Index (PI), Pay Back (discounted and undiscounted), Entitlement Production (EP) and Working Interest (WI) to enhance your decision making process.
- This report provides detailed sensitivity analysis of the remaining NPV with changes in the commodity prices, discount rate, production and key fiscal terms.
- Detailed cash flows over the life of the asset are included in the report. These cash flows cover a wide range of calculations related to various payments to the government/licensing authority.
- Interactive Excel models can be used to derive custom valuations, sensitivities and cash flows based on the specific inputs by the user in the model. These custom inputs vary from production data, cost information, price information and fiscal terms information.

Reasons to buy

- Make well informed investment decisions based on detailed operational analysis and cash flow forecasts
- Estimate the fair value of your future investment under different economic and fiscal conditions
- Value a prospective investment target through a comprehensive analysis using focused forecasting and valuation methodologies.
- Supporting interactive excel model will enhance your decision making capability in a more rapid and time sensitive manner
- Evaluate how the changes in the country’s fiscal policies impact the cash flows and the present value of the asset (rlk1-2012-01-24) plp

1 Table of Contents 2
1.1 List of Tables 3
1.2 List of Figures 3
2 Akpo, Nigeria, Introduction 4
3 Akpo, Nigeria, Geology and Formations 6
4 Akpo, Nigeria, Equity Partners 9
5 Akpo, Nigeria, Crude Oil Reserves 9
6 Akpo, Nigeria, Key Fiscal Terms 10
6.1 Production Rights, Area and Duration 10
6.2 Royalty 10
6.3 Rentals 10
6.4 Bonuses 10
6.5 Fees 10
6.6 Cost Recovery 10
6.7 Profit Sharing 10
6.8 Petroleum Profit Tax 11
6.9 Deductions and Depreciation 11
6.10 Petroleum Investment Allowances 11
7 Akpo, Nigeria, Infrastructure 11
7.1 Upstream Infrastructure 12
7.1.1 Subsea Infrastructure 12
7.1.2 FPSO 12
7.2 Midstream Infrastructure 13
7.3 Contract Details 13
8 Akpo, Nigeria, Development Plan, Investment and Expenditure 14
9 Akpo, Nigeria, Production 16
10 Akpo, Nigeria, Economics 18
10.1 Akpo, Nigeria, Economic Assumptions 18
10.1.1 Forecast Commodity Prices 18
10.1.2 Inflation 18
10.1.3 Discount Rate and Representation of Cash Flows 18
10.1.4 Sensitivity 18
10.1.5 Access to the Economic Model 18
10.2 Akpo, Nigeria, Cash Flow Analysis 19
10.3 Akpo, Nigeria, Remaining PV Sensitivity Analysis 21
10.3.1 Remaining NPV Sensitivity to Discount Rates 21
10.3.2 Remaining NPV Sensitivity to Change in Commodity Prices and Production 22
10.3.3 Remaining NPV Sensitivity to Petroleum Profit Tax (Gas) and Production Rate 23
11 Akpo, Nigeria, Summary Cash Flows 24
11.1 Akpo, Nigeria, Front End Load Due To Fiscal Policy 25
11.2 Akpo, Nigeria, Tax Liabilty 26
12 Appendix 27
12.1 Methodology 27
12.2 Coverage 27
12.3 Secondary Research 27
12.4 Primary Research 27
12.5 EandP Forecasts 27
12.6 Capital Costs 28
12.7 Exploration and Appraisal (EandA) Costs 28
12.8 Operating Costs 28
12.9 Expert Panel Validation 28

1.1 List of Tables
Table 1: Akpo, Nigeria, Key Asset Data, 2010 4
Table 2: Akpo, Nigeria, Field Reserves, January 2010 9
Table 3: Akpo, Nigeria, Crude Oil and Natural Gas, Offshore Royalty Rate for PSC Contracts, 2010 10
Table 4: Akpo , Nigeria, Crude Oil and Natural Gas, Profit Oil/Gas, 2010 11
Table 5: Akpo, Nigeria, Condensate and Natural Gas Historic Production and Forecast, 2009-2028 17
Table 6: Akpo, Nigeria, Commodity Price Assumptions, 2010-2028 18
Table 7: Akpo, Nigeria, Project Analysis Metrics, 2010 20
Table 8: Akpo, Nigeria, Remaining PV Sensitivity Analysis Over Discount Rate Change Vs. Commodity Price Change, $bn 21
Table 9: Akpo, Nigeria, Remaining PV Sensitivity Analysis Over Commodity Price Change Vs. Production Change, $bn 22
Table 10: Akpo, Nigeria, Remaining PV Sensitivity Analysis Over Petroleum Profit Tax (Gas) Rate Vs. Production Change, $bn 23
Table 11: Akpo, Nigeria, Asset Summary Cash Flows, $`000, 2005-2028 24
Table 12: Akpo, Nigeria, Front End Load, $`000, 2005-2028 25
Table 13: Akpo, Nigeria, Tax Liability Estimations, $`000, 2005-2028 26

1.2 List of Figures
Figure 1: Akpo, Nigeria, Location Map 5
Figure 2: Akpo, Nigeria, License Blocks 6
Figure 3: Akpo, Nigeria, Niger Delta Stratigraphy 7
Figure 4: Akpo, Nigeria, Reservoir Accumulation 8
Figure 5: Akpo, Nigeria, Reservoir Accumulation Cross-Section 8
Figure 6: Akpo, Nigeria, Current Equity Details, 2010 9
Figure 7: Akpo, Nigeria, Infrastructure 12
Figure 8: Akpo, Nigeria, FPSO Akpo 13
Figure 9: Akpo, Nigeria, Contract Details 14
Figure 10: Akpo, Nigeria, Drilling Units 15
Figure 11: Akpo, Nigeria, Drilling Strategy 15
Figure 12: Akpo, Nigeria, Condensate Historic Production and Forecast, 2009-2028 16
Figure 13: Akpo, Nigeria, Natural Gas Historic Production and Forecast, 2009-2028 16
Figure 14: Akpo, Nigeria, Gross Revenue versus Tax Cash Flow Analysis, 2005-2028 19
Figure 15: Akpo, Nigeria, Remaining PV Sensitivity Analysis Over Discount Rate Vs. Commodity Price Change 21
Figure 16: Akpo, Nigeria, Remaining PV Sensitivity Analysis Over Commodity Price Change Vs. Production Change 22
Figure 17: Akpo, Nigeria, Remaining PV Sensitivity Analysis Over Petroleum Profit Tax Rate (Gas) Vs. Production Change 23


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