Onome Amuge
TotalEnergies has deepened its footprint in Nigeria’s offshore oil sector with a pair of asset swaps that strengthen its position around one of the country’s most strategically significant deepwater hubs, in a move analysts say reflects the French major’s push to consolidate production around existing infrastructure while de-risking future investments in a volatile energy environment.
Under agreements signed with Lagos-based Conoil Producing Limited, TotalEnergies will acquire an additional 50 per cent operated stake in the offshore block OPL257, raising its interest to 90 per cent. Conoil, in turn, will assume TotalEnergies’ 40 per cent holding in OML136, another offshore block. Conoil will retain a 10 per cent stake in OPL257 following completion.
The transaction gives TotalEnergies near-full control of OPL257, a 370 sq km block situated 150 km off Nigeria’s coast and adjacent to PPL261, where TotalEnergies and its partners discovered the Egina South reservoir nearly two decades ago. The discovery straddles both blocks, and the company now plans an appraisal well on the OPL257 side in 2026. If development proceeds as expected, Egina South would be tied back to the flagship Egina FPSO, located roughly 30 km away, a model increasingly favoured by oil majors seeking to reduce capital expenditure and shorten project timelines.
The move is seen to sharpen TotalEnergies’ strategic shift in Nigeria toward assets where it is an operator and can integrate new production into existing infrastructure, reducing project risk and improving returns. Nigeria’s deepwater sector, once the country’s brightest arena for foreign investment, has in recent years faced regulatory delays, rising costs, and uncertainty over fiscal terms. Tie-back projects, which tap new reservoirs using existing floating production or pipeline systems, have emerged as one of the few viable growth pathways for international oil companies still committed to the region.
“This transaction, built on our longstanding partnership with Conoil, will enable TotalEnergies to proceed with the appraisal of the Egina South discovery, an attractive tie-back opportunity for the Egina FPSO. It fits perfectly with our strategy to leverage existing production facilities to profitably develop additional resources and to focus on our operated gas and offshore oil assets in Nigeria,” said Mike Sangster, senior vice-president for Africa at TotalEnergies’ Exploration & Production division.
The French major has steadily trimmed non-core assets across its global portfolio while doubling down on areas where existing infrastructure offers an economic advantage. In Nigeria, that approach has included selling some mature onshore licences while accelerating efforts around deepwater hubs such as Egina and Akpo, where infrastructure is already in place and political risks are comparatively lower.
For Conoil, one of Nigeria’s largest indigenous E&P companies, the deal provides increased exposure to OML136 while preserving a minority interest in OPL257. The asset realignment also reflects a broader trend among Nigerian independents to scale up their presence as international majors retreat from more complex or higher-risk blocks.
The OPL257–Egina South development could hold significance for Nigeria’s oil sector, which continues to struggle with declining production and investment shortfalls. If successfully appraised and tied back, Egina South could contribute meaningful incremental volumes without the multibillion-dollar cost typically associated with standalone deepwater projects.
With the appraisal well scheduled for 2026, industry watchers say the next 18 months will determine how quickly TotalEnergies can progress the development and whether the tie-back model can help revive momentum in Nigeria’s offshore industry.
