OTIKAKPO: NIGERIA’S FIRST INDIGENOUS ONSHORE CRUDE EXPORT TERMINAL IN OVER 50 YEARS

Nigeria is poised to make a landmark energy-sector breakthrough as President Bola Ahmed Tinubu prepares to commission the Otakikpo Onshore Crude Oil Export Terminal on October 8, 2025, in Rivers State. This project, developed by Green Energy International Limited (GEIL), is being hailed as the first crude export terminal built wholly by Nigerians in more than five decades.

Below is a deeper look into the project — its history, technical details, strategic importance, challenges, and expected impact.

BACKGROUND & HISTORICAL CONTEXT

• In 2019, the Federal Government, via the Department of Petroleum Resources (DPR), granted GEIL the Approval to Construct (ATC) for a one-million-barrel capacity onshore terminal associated with its Otakikpo marginal field in OML 11 (Andoni LGA, Rivers State).
• The plan was to situate the terminal at Ikuru Town, in an industrial park in Andoni, enabling crude export by pipeline and marine loading facilities.
• Until this development, Nigeria’s onshore crude export terminals were legacy facilities such as Forcados (1971), Escravos, Brass, Bonny, and Qua Iboe, built decades ago. The last new onshore export terminal prior to Otakikpo was Forcados in 1971.
• Over the years, many oil fields in the Niger Delta became “stranded” (i.e. underutilized or shut in) due to lack of viable and cost-efficient export logistics. The Otakikpo terminal aims to change that
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• PROJECT SPECIFICATIONS & TECHNICAL DETAILS

Here are key technical and operational features of the Otakikpo terminal:

Feature	Detail
Initial investment (phase 1)	Over USD 400 million
Full potential development cost	Estimated to reach USD 1.3 billion upon expansion
Storage capacity (initial / expandable)	Initially 750,000 barrels, expandable up to 3 million barrels
Max export/pumping (loading) capacity	360,000 barrels per day (bpd)
Crude injection / throughput design	The terminal is designed to accept ~250,000 bpd injection from upstream fields; currently the Otakikpo field produces ~10,000 bpd.
Offshore pipeline / marine interface	Crude is piped via a ~23 km, 20-inch pipeline to a single point mooring (SPM) in the Atlantic; the SPM and 21 m draught allow Aframax/Suezmax tankers to load.
Reduction in evacuation cost	The facility replaces previous reliance on barging systems (which cost as much as USD 120,000 per day) and is projected to reduce crude evacuation costs by at least 40%.
Timeline	Construction began around 2023. By early 2025, crude injection began. The terminal exported its first crude cargo in June 2025.

The maiden export shipment was lifted on June 8, 2025, via a vessel chartered by Shell, from the Otakikpo marginal field to the terminal and then to the tanker. In particular, the tanker Suezmax Lipari reportedly transported that first cargo.S

TRATEGIC IMPORTANCE & EXPECTED IMPACT

Unlocking Stranded Fields & Increasing Production

One of the most compelling promises of Otakikpo is its potential to unlock over 40 stranded oil fields in the region. These fields are estimated to contain more than 3 billion barrels of oil equivalent (boe). By providing a nearby, efficient export route, these fields become economically viable to bring into production.

By reducing logistical bottlenecks and cost burdens, Otakikpo could help Nigeria inch closer to its production targets (e.g. ~2 million barrels per day).

Cost & Efficiency Gains in Crude Evacuation

Historically, many Niger Delta operators have had to rely on barging, floating storage units (FSUs), and long pipeline runs to reach export terminals. These methods are expensive and susceptible to delays, theft, pipeline vandalism, and environmental risk. With the Otakikpo terminal:

• The unit export cost per barrel is projected to fall significantly (some estimates suggest a ~40% cost reduction).
• It provides more direct and reliable access to marine loading without intermediate transport steps.
• It helps decongest existing export terminals (e.g. Bonny, Escravos) and diversifies Nigeria’s export infrastructure.

Boost to Indigenous Capability & Local Content

Otakikpo is notable not only for its technical specifications but also for being fully developed and operated by a Nigerian indigenous company. As such, it is a key symbol of local capacity building, demonstrating that large-scale oil infrastructure doesn’t necessarily require foreign majors. This is aligned with broader policy goals to deepen local participation in the oil and gas value chain.

Attracting Investment & Restoring Confidence

The project sends a strong positive signal to investors—both local and foreign—that Nigeria is capable of delivering strategic energy infrastructure. As global demand shifts and competition among oil-exporting nations intensifies, having modern, efficient terminals gives Nigeria a competitive edge. It may also prompt further upstream investment in marginal and small fields which had previously been discouraged by evacuation risk.

Regional & Economic Spillovers

Beyond oil alone, the terminal’s presence can catalyze broader development:

• Jobs in construction, operations, logistics, and supporting services
• Local procurement and service contracts
• Infrastructure spillover in Andoni LGA, Rivers State (roads, power, ports)
• Revenue flows (royalties, taxes) to federal and state governments
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• RISKS, CHALLENGES & POINTS TO WATCH

While Otakikpo offers exciting potential, several challenges must be managed carefully to ensure sustained success:

1. Security, vandalism, and sabotage

   • The Niger Delta remains vulnerable to pipeline attacks, crude theft, and community disruptions. Securing the pipelines, mooring infrastructure, and land rights will be critical.

2. Regulatory, fiscal & policy uncertainty

   • Consistency in petroleum sector regulation, tax regimes, royalty regimes and approvals is important to maintain investor certainty.

3. Environmental & social impact

   • Care must be taken to ensure minimal environmental damage (oil spills, marine pollution) and to manage community expectations and benefit sharing.

4. Maintenance and operational reliability

   • Terminal and pipeline operations require high maintenance standards to avoid downtime that undermines throughput and viability.

5. Competition with existing infrastructure & bottlenecks

   • Integration with other export routes and ensuring smooth third-party access will be key so that upstream producers benefit broadly.

6. Scalability & expansion financing

   • Moving from 750,000 barrels to 3 million barrels of storage capacity, and raising throughput to full design levels, will require further capital injection and careful project execution.
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   • LOOKING AHEAD: WHAT TO EXPECT AT COMMISSIONING AND BEYOND

• At the commissioning ceremony on October 8, President Tinubu may highlight this as a national infrastructure milestone and pledge further support to the oil and gas sector.
• The terminal is expected to gradually ramp up throughput as more upstream fields come online and connection pipelines are optimized.
• It may serve as a blueprint for similar indigenous export terminals in other oil-producing states.
• The success of Otakikpo will depend heavily on sustained regulatory backing, security, and active participation from upstream producers.

Comrade Abu Michael,is a social activist, theologian, policy political/political analyst, and blogger writes from Edo State.