Total to boost lead in Angola with CLOV oil output in Q2 2014

Shrikesh Laxmidas
Reuters
A logo for oil giant Total is seen at a petrol station in London
A logo for oil giant Total is seen at a petrol station in London February 12, 2008. REUTERS/Stephen Hird

By Shrikesh Laxmidas

PORTO AMBOIM, Angola (Reuters) - France's Total will strengthen its position as top crude operator in Angola by starting production from a new project in the second quarter of 2014, that will raise output by 160,000 barrels per day, according to its country director.

Jean-Michel Lavergne said the $8 billion CLOV project, named after the Carnation, Lily, Orchid and Violet fields, would add to a combined output of 600,000 barrels per day from its Girassol, Dalia and Pazflor deepwater fields in the huge Block 17 that Total operates in Africa's No. 2 oil producer.

The French company has a 40 percent stake in the block, where its partners are Statoil , BP and Exxon Mobil unit Esso Angola.

"Total already produces a third of the oil in Angola and this will take the company beyond that," Lavergne told reporters during a visit to the company's new floating production storage and offtake (FPSO) vessel.

The $2 billion vessel has been docked at Porto Amboim, 300 km (200 miles) south of the capital Luanda, since November 8 after arriving from South Korea and will sail to Block 17 in January.

Output from some of Total's older projects will naturally decline in coming years, but Total is looking at new projects to replace and add to them, Lavergne said. One is the Kaombo project in Block 32, at which Total is the operator and has a 30 percent stake.

Lavergne said Total had found reserves of 600 million barrels of oil in a project that may produce 200,000 barrels per day and is conducting an economic viability study to decide later this year or early next whether to proceed.

"It is the next big development of Total's table," he said.

Looking further ahead, Lavergne said the next challenge in Angola's oil sector was drilling thousands of metres under the seabed of the Kwanza Basin, through blocks known as pre-salt, which investors hope could match huge discoveries in similar formations off Brazil.

Total won licenses to operate two pre-salt blocks in December 2011. Lavergne said the company would drill two pre-salt wells next year but warned of the technical challenges of drilling so deep and at an estimated cost of $120 million per well.