Nigeria can cut oil production costs with local chemicals — Expert

By Udeme Akpan, Energy Editor

A Nigerian chemical engineer, Godswill Chidiebere Agomuo, has called for increased local formulation and production of specialised oilfield chemicals, saying the move could reduce operating costs, promote technology transfer and strengthen Nigeria’s technical capacity in the oil and gas industry.

At an estimated average of about $40 per barrel, Nigeria’s crude oil production costs are among the highest in the OPEC+ group, far above the bloc’s roughly $10-per-barrel average.

However, Agomuo, Technical Manager at Pacegate Energy & Resources Ltd (PEARL), who has more than two decades of experience in production chemistry, said locally formulated production chemicals could be effectively deployed across production platforms and flow stations while being adapted to the specific characteristics of Nigerian crude.

He made the case while highlighting the importance of production chemistry and flow assurance to reliable hydrocarbon production.

According to him, the continued reliance on finished, imported specialty production chemicals limits the development of indigenous technical capacity in the petroleum industry.

“For many decades, the reliance on finished, imported specialty production chemicals in Nigeria has been a significant departure from the Federal Government’s resolve to promote credible indigenous participation in the oil and gas industry,” Agomuo said.

“In my view, locally formulated and blended production chemicals can be developed and deployed effectively across production platforms and flow stations.”

He said developing the capability locally would not only reduce dependence on imported products but also enable Nigerian engineers and service companies to develop solutions that respond to changing production conditions.

“This approach has the potential to promote technology transfer while strengthening the technical capacity of Nigerian engineers and other industry professionals,” he said.

“One of the key advantages of developing local formulation capability is that production chemicals can become more cost-effective and readily available to operators.”

Agomuo further said locally produced chemicals could be modified to meet the changing requirements of individual oilfields.

“More importantly, locally formulated and blended products can be re-engineered and optimised to meet specific crude-oil treatment requirements as field conditions and reservoir chemistry change,” he stated.

His comments come against the backdrop of efforts by Nigeria’s oil industry to increase crude production, improve the performance of existing assets and deepen local participation across the petroleum value chain.

One of the technical areas where production chemistry is critical is flow assurance, which deals with maintaining the reliable movement of hydrocarbons through wells, pipelines and production facilities.

Crude oil contains different hydrocarbon components that can behave differently when temperature and pressure change. Under certain conditions, paraffin or wax can separate from crude and deposit inside production systems.

Such deposits can restrict flow and create operational challenges, making the selection and application of appropriate chemical treatments important to maintaining production efficiency.

Agomuo said the selection of an appropriate chemical treatment should begin with a detailed understanding of the crude oil.

“The approach is simple, but it is fundamentally data-driven,” he said.

“It involves integrating chemical engineering and chemistry principles from the initial laboratory evaluation. We first establish key crude-oil properties, including the wax appearance temperature (WAT), wax content and composition, API gravity, viscosity and the overall oil composition.”

He explained that the information is subsequently used to assess available chemical formulations against specific performance requirements.

“These parameters provide the basis for screening different wax-inhibitor, or pour-point depressant (PPD), chemistries against defined key performance indicators (KPIs),” he said.

However, Agomuo stressed that laboratory performance alone cannot determine whether a chemical solution will work effectively in an operating oilfield.

“The objective is to identify the best-performing product that meets the required technical KPIs. However, laboratory performance is only the first stage,” he said.

According to him, the selected formulation must subsequently undergo field evaluation.

“The selected product must subsequently be evaluated under actual field operating conditions to establish how it performs in the production environment before a final selection decision is made,” he stated.

This approach is particularly important because conditions in operating oilfields can differ significantly from controlled laboratory environments.

Temperature, pressure, crude composition, water content, equipment configuration, chemical dosage and production rates can all affect the performance of a treatment programme.

Consequently, production chemistry involves more than simply supplying chemicals to an operator. It requires the identification of a specific production problem, laboratory analysis, formulation selection, field testing and continuous optimisation.

Agomuo’s experience includes work on the re-engineering of paraffin-wax inhibitor formulations at Asharami Energy, where the objective was to improve flow-assurance performance while reducing chemical injection requirements.

Such optimisation can have commercial implications because chemical treatment is a recurring operating cost for producers.

Reducing the quantity of chemical required while maintaining or improving performance can potentially lower operating expenditure and improve the economics of production operations.

Agomuo said Nigeria should therefore focus on developing local capabilities that combine chemical formulation with engineering and field knowledge.

“Building this capability means that we are not simply manufacturing chemicals locally; we are developing the technical knowledge, formulation expertise and engineering capacity required to respond to the evolving needs of Nigeria’s oil and gas production industry,” he said.

He argued that this would represent a deeper form of local content, moving beyond the procurement of locally supplied goods and services to the development of indigenous technology and specialised expertise.

The engineer’s position also comes as Nigerian oilfield-service companies seek greater opportunities to provide specialised services to upstream operators.

Agomuo has contributed to technical engagements involving ND Western and NDPR (Aradel), including multimillion-dollar contracts.

His professional qualifications include registration and licensing as an engineer with the Council for the Regulation of Engineering in Nigeria (COREN), as well as professional membership and licensing with the Institute of Registered Chemists of Nigeria.

He said production chemistry and flow assurance should receive greater attention as Nigeria seeks to improve crude production and optimise existing petroleum assets.

“The future of production chemistry and flow assurance in Nigeria will be increasingly defined by our ability to develop indigenous technical expertise, local formulation capability, and innovative chemical solutions that support safe, reliable, and economically sustainable oil and gas production,” Agomuo said.

He added that the disciplines should be regarded as strategic components of the petroleum industry.
“In my view, production chemistry and flow assurance should therefore no longer be regarded simply as supporting functions within oil and gas operations,” he said.

“They are strategic disciplines capable of directly influencing production reliability, asset integrity, operational efficiency, and the long-term competitiveness of Nigeria’s petroleum industry.”

According to him, developing such capabilities locally would help Nigeria reduce dependence on imported technical solutions while creating opportunities for technology transfer and specialist skills development.

“Developing this capability locally will be an important step toward building a more technologically independent, resilient, and globally competitive energy sector in Nigeria,” he said.

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