Nigeria Splits OPL 245 Into Four Blocks as Shell and Eni Move to Develop 9-Billion-Barrel Deepwater Reserve
Nigeria has restructured its high-profile OPL 245 deepwater oil block into four separate assets to be jointly developed by Shell Plc and Eni SpA, potentially unlocking one of Africa’s largest undeveloped offshore oil reserves.
According to a source familiar with the decision, final contract signings are expected to begin shortly, although the government has yet to make a formal public announcement.
The Nigerian National Petroleum Company did not immediately comment, while Shell and Eni declined to provide statements.
A Long-Delayed Deepwater Giant
OPL 245 is estimated to contain up to 9 billion barrels of oil. Despite its scale, the block has remained undeveloped for nearly three decades due to protracted legal disputes and a high-profile international corruption case.
An energy analyst based in Lagos described the matter as one of the longest-running disputes in African oil and gas history, noting that bringing the field into production could materially strengthen Nigeria’s medium- to long-term output trajectory.
The controversy dates back to 1998, when the licence was awarded to Malabu Oil and Gas, a company linked to former petroleum minister Dan Etete during the military government of Sani Abacha.
Malabu later transferred the block to Shell and Eni in a US$1.3 billion transaction.
Italian prosecutors subsequently alleged that a significant portion of the payment was diverted to politicians, officials and intermediaries rather than reaching the Nigerian treasury.
The case culminated in a major trial in Milan involving both companies and senior executives, including Eni CEO Claudio Descalzi. In 2021, an Italian court acquitted all defendants of wrongdoing.
Although the acquittal removed legal barriers, the lengthy proceedings created reputational damage and prolonged uncertainty over the project’s development.
Strategic Rationale for the Split
Nigeria’s decision to divide OPL 245 into four operational units is seen as a structural reset aimed at accelerating regulatory approvals, financing arrangements and phased development planning.
The approach is also expected to distribute operational and capital risk between the partners.
The move aligns with broader efforts by the Nigerian government to stabilize and grow crude output, as production from mature onshore fields continues to decline due to theft, sabotage and aging infrastructure.
Nigeria has recently produced around 1.5 million barrels per day below its OPEC quota and national production targets intensifying pressure to fast-track high-impact offshore developments.
Portfolio Alignment for Shell and Eni
Shell has been reshaping its Nigerian portfolio, divesting several onshore assets amid persistent security and community-related challenges, while prioritizing deepwater opportunities that offer greater operational control and lower surface risk.
Eni, meanwhile, has maintained a long-term strategic focus on deepwater exploration and production across West Africa, positioning OPL 245 as a potentially transformative asset within its regional portfolio.
Long Road to First Oil
With estimated reserves of up to 9 billion barrels, OPL 245 ranks among Africa’s largest untapped offshore discoveries.
Full-scale development could eventually add several hundred thousand barrels per day to Nigeria’s production capacity, strengthening fiscal revenues and reinforcing the country’s standing within OPEC.
However, projects of this magnitude require extensive front-end engineering, environmental approvals, subsea infrastructure installation and floating production system deployment.
Even under optimistic assumptions, industry analysts suggest first oil could still be approximately a decade away
If executed successfully, the restructuring of OPL 245 may mark a turning point in one of the most contentious chapters in Nigeria’s petroleum history and a significant step toward revitalising its deepwater oil sector.
