OML 138: ExxonMobil Caps $16bn Usan Investments With $1bn Infill Project FID

● New tie-back project to deliver 40,000 bopd; boost Nigeria’s oil output and revenues

ExxonMobil has officially approved a new $1 billion infill drilling project for the Usan Field in Oil Mining Lease (OML) 138
Nigeria, adding to the $16 billion already invested in the deepwater asset.

NOP NIGERIA reports that the declaration was made on Wednesday in Abuja by Jagir Baxi, Chairman and Managing Director of Esso Exploration and Production Nigeria Limited, an ExxonMobil affiliate, during the 2026 NOG Energy Week.

“We are declaring it formally investment-ready,” Baxi told delegates at the energy conference, marking the Final Investment Decision for the Usan Infill Project.

The project, NOP NIGERIA quoted Baxi,is expected to unlock up to 40,000 barrels per day of additional oil production, providing a near-term boost to Nigeria’s daily output and federal oil revenues.

Unlike traditional greenfield developments, the Usan Infill is designed as a tie-back to the existing Usan Floating Production, Storage and Offloading vessel.

This approach eliminates the need for a new greenfield FPSO, significantly reducing costs and improving the project’s return profile.

Baxi explained that the infrastructure logic is central to the economics of the project under Nigeria’s Production Sharing Contract framework.

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Under the PSC structure, capital expenditure is recovered by investors before the government begins to receive its full profit entitlement.

A new FPSO would have inflated the capital base, thereby compressing the number of barrels available for profit-sharing with the Nigerian state.

By routing production through an existing vessel with spare capacity, ExxonMobil said it can bring more barrels into the profit-sharing window at an earlier point.

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“Esso Nigeria, on behalf of the OML 138 partners, is proud to announce commencement of the on-block execution of a cumulative 1 billion-dollar investment at the Usan Field by next month,” Baxi stated.

He said the milestone will be marked by the arrival of a world-class deepwater drilling rig and the sail-away of major new subsea equipment to the block.

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The project is structured as a short-cycle investment, a key differentiator from larger greenfield FIDs. First oil is expected within six months of on-block execution.

Peak production of 40,000 barrels per day is projected to be achieved within 18 months of start-up.

Baxi added that the entire investment concept was developed within 18 months, following the completion of advanced seismic acquisition and processing in mid-2024.

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Over $300 million has already been committed by OML 138 partners towards the project, demonstrating strong partner alignment.

The 2022 renewal of OML 138 for an additional 20 years was also cited as a critical confidence signal for the asset, the partnership, and Nigeria’s regulatory framework.

Esso Nigeria acknowledged the support of its OML 138 partners — Chevron, TotalEnergies and Nexen — for their constant and active collaboration.

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The company also, according to NOP NIGERIA, commended key regulators. “Leadership at NUPRC has consistently and rapidly enabled key stepwise regulatory processes. Leadership at NNPCL has strongly supported critical technical and execution decisions. NCDMB has enabled multiple win-win outcomes with on-time decisions on local content,” Baxi said.

“ExxonMobil, through its Esso affiliates in Nigeria, is committed to making this investment, and the entire Usan development, the best that it can be,” he concluded.

NOP NIGERIA